BPI Investor Update - Bank of the Philippine Islands · PDF fileFounded in 1851, as Banco...

CONFIDENTIAL

BPI Investor UpdateStrength and Quality in Earnings

As of June 30, 2017

Founded in 1851, as Banco Español Filipino de Isabel II, by Catholic charities– Antonio de Ayala inaugural member of board

Named Bank of the Philippine Islands (Banco de las Islas Filipinas) after Treaty of Paris (1898)

Ayala y Compañia (present day Ayala Corp.) assumes strategic stake in 1969

Morgan Guaranty Trust Company (“MGT”)purchases stake in People’s Bank, a predecessor company, in 1974

DBS and GIC, Singapore’s sovereign wealth fund, eventually acquired MGT’s stake– GIC now has an effective 5.6% ownership

Summary History of BPI

Pesos Fuertes, 1883

BPI Iloilo, 1897

2BPI Investor Update: Strength and Quality in Earnings

GIC, 5.6%

RCAM*, 8.3%

Ayala Corp,48.2%

Public Float,37.9%

Shareholders & Equity Profile

Fundamentals Description

PCOMP Index 4.99% weight

Stock Price P101.00 per share

BV per share P44.04

P-B Ratio 2.29x

P-E Ratio 17.06x

Dividends P1.80 per share

Issued Shares 3.939 bn

Market Cap P397.877 bn

Shareholders As of September 15, 2017

* Roman Catholic Archdiocese of Manila


BPI: 165 Years in the Philippines

Branches ATMs/CAMs

Expansive reach in both traditional and electronic channels

8.2 million customers

844 branches*

3,079 ATMs & CAMs

15,621 employees

BPI Investor Update: Strength and Quality in Earnings 4

* Local and International

Electronic ChannelsSignificant leadership in technology-based banking


+14.5%

+22.3%

+19.9%

-

Express Mobile

Express Phone -5.2%

No. of Clients 1H 2015 1H 2016 1H 2017

Express Online 2,078,324 2,422,846 2,774,969

Express Mobile 1,409,019 1,851,783 2,265,280

Express Phone 844,183 801,853 760,006

ExpressLink 24,060 27,306 32,747

* Commission on Filipino Overseas, Stock Estimate of Overseas Filipinos as of Dec 2013

ITSC MeetingBPI Investor Update: Strength and Quality in Earnings

A Leader Among Philippine Banks in OF Remittances

BSP Vol (USD bn) 25.77 26.90 13.81 4%

BPI

Vol (USD bn) 6.97 6.79 3.40 -3%

Share (%) 27% 25% 25%

Total OFWs* BPI Tie-Ups10.5 million 145

OFW Diaspora & Global BPI Tie-Ups

Canada

$ 350 mn 4Europe

$ 60 mn 5 Asia$ 2,540 mn 3

Middle East$ 3,939 mn 2

U.S.A

$ 4,567 mn 1

Remittance 2015 2016 1H ‘17 YoY Total OFWs* BPI Tie-Ups

6

Excellence in Debt Capital Markets


Underwriter Mkt Share (%) Issues

BDO Capital 1 20.1 8

BPI Capital Corp 2

China Banking Corp 3

Standard Chartered 4

5Security Bank

ING Group 6

7PNB

16.0

10.4

9.4

8.8

8.4

6.6

8

5

6

6

3

9

1H 2017 Rank

Sep 2016

Oct 2016

Dec 2016

Feb 2017

June 2017

Best SME Bank Alpha Southeast Asia

Best Domestic BankFinance Asia

Best in Retail ServicesThe Asian Banker

Highest Volume Growth, Top Consumer Prepaid IssuerMore Fun Prepaid & Ayala Malls Amore Cards: Visa

2016 Bond Deal of the Year, AboitizPower’s Tiwi Makban Geothermal Energy ProjectThompson Reuters: Project Finance International Magazine

Best Bank in the Philippines, 4th time in a rowCorporate Treasurer

Best Private BankEuromoney’s Private Banking and Wealth Management Survey

Best Service Provider for Trade Finance, 5 consecutive yearsTriple A Awards


Recent Distinctions

BPI Management Team

Picture

Cezar P. ConsingPresident & CEO

RetailClients

EnterpriseServices

Financial Products &

Services

Corporate Clients

Global Markets

JosephGotuaco

NatividadAlejo

Daniel Montecillo

SimonPaterno

AntonioPaner

Ramon Jocson

Theresa Javier

Edgardo Madrilejo

EVP EVP EVP EVPEVP &

Treasurer EVP SVP & CFO SVP & CRO

Strategy &Dev’t

Risk Mgmt


Microfinance

1H 2017 Performance HighlightsSustained growth in assets

in P Bn 2016 2017 YoY (ppt)

Balance Sheet

Assets 1,584.6 1,716.0 8.3%

Net Loans 904.4 1,056.9 16.9%

Deposits 1,326.8 1,432.5 8.0%

CASA 975.4 1,050.5 7.7%

Capital 160.8 173.5 7.9%

Income Statement

Net Revenues 35.2 35.3 0.4%

Net Int Income 20.7 23.5 13.6%

Non-Int Income 14.5 11.8 -18.4%

Opex 17.3 18.3 5.4%

Provisions 3.1 2.5 -20.7%

Net Income 12.7 11.7 -7.7%

Comp Income 13.9 11.8 -15.6%


1H 2017 Performance HighlightsAdequate capital, and strong asset quality

2016 2017 YoY (ppt)

Balance Sheet

LDR 68% 74% 5.6%

CASA Ratio 74% 73% -0.2%

Profitability

CIR 49% 52% 2.7%

ROE 16.4% 13.7% -2.7%

ROA 1.6% 1.4% -0.3%

Asset Quality

Gross 90-Day NPL 1.56% 1.48% -0.1%

NPL Cover 118% 126% 8.3%

Capital

CAR 13.9% 13.7% -0.2%

CET1 13.0% 12.8% -0.2%


12.7 11.7

1H 2016 1H 2017

13.9

11.8

1H 2016 1H 2017

Strong Earnings QualityNet Income -7.7%, Comprehensive Income -15.6% YoY

12

Net IncomeP bn

Comprehensive IncomeP bn

-7.7%

YoY Growth

-15.6%

YoY Growth

BPI Investor Update: Strength and Quality in Earnings

59% 67%

41% 33%

1H 2016 1H 2017

20.7 23.5

14.5 11.8

35.2 35.3

1H 2016 1H 2017

Revenue Growth Remains PositiveCore intermediation business continued to be strong driver of revenues

13

RevenuesP bn

Revenue Mix

Net Interest Income Non-Interest Income


13.6%

-18.4%

YoY Growth

0.4%

Non-Interest Income


Securities & FX trading decrease +P4.35 bn (-67.9) vs last year

Fees & other income up by +P1.6 bn (17.5%) vs last yeardriven by:– Cards & Payments– Service Charges– Investment Banking– Asset Sales

1 Non-Interest Income at gross

8.910.5

6.4 2.1

15.3

12.5

1H 2016 1H 2017

Breakdown of Non-Interest IncomeP bn

-27.84%

12.1%

17.5%

-67.9%

YoY Growth

-18.2%

58% 84%

42% 16%

Fees & Others

Sec & FX

Slowdown in securities trading shrunk non-interest income in 1H 2017

118%

126%

1.56%1.48%

1H 2016 1H 2017

904.4

1,056.9 1,040.7

2016 2017

Loan Book Has Both Growth and Quality

15

Net LoansP bn

Asset Quality

NPL Cover Gross 90-D NPL


1.6%

Growth

16.9%

Year-end 1H

Loan book driven by corporate loans which grew 19.5%

111.6 117.1

53.5 57.0

39.646.7

1H 2016 1H 2017

635.7773.8

77.7

78.4

1H 2016 1H 2017

YoY Growth

Sustained Growth in Loan Segments

Corporate Loan BalancesP bn

Retail Loan BalancesP bn

89% 91%Corp%

11% 9%SME%

55% 53%Housing%

26% 26%Auto%

19% 21%Cards%

19.5%

1%

21.7%

713.4

852.2

204.7220.8

1 Cards inclusive of Personal Loans.

4.9%

6.6%

18.0%

7.9%

YoY Growth

Going beyond marginal bookings


74% 73%

68%

74%

1H 2016 1H 2017

1,326.8 1,432.5

975.4 1,050.5

1H 2016 1H 2017

Deposit and CASA Growth Remains StrongEfficiency continues to improve with LDR ratio

DepositsP bn

CASA Ratio, LDR

8.0%

7.7%

YoY Growth

Total Deposits CASA Deposits CASA Ratio LDR


1,818.9 1,888.1

1H 2016 1H 2017

Growth in AUM


Asset Under Management1

P bn

21.6% -Share

Asset Management FeesP mnYoY Growth

1.5%

-15.8%

YoY Growth

3.8%

Total intermediated funds increased by 5.8%

1 BPI’s asset management business is managed thru three wholly-owned subsidiaries:BPI Asset Management & Trust Corp., BPI Investment Management Inc., BPI International Finance Limited

692.2 702.8

1H 2016 1H 2017

141 157 105 119

1,019 1,142

835 964

Conso 1H 2016 Conso 1H 2017 Parent 1H 2016 Parent 1H 2017

Capital Position


13.013.9 13.7

12.812.611.8

12.411.5

CAR % CET1 %Qualifying Capital Risk Weighted Assets

Growth in RWA, led by credit risks, outpaced the growth in qualifying capital

Credit RatingsMoody’s1 Fitch Ratings2 Capital

Intelligence3

Bank Financial Strength Rating

- - BBB

LT Local Currency Rating

- BBB- -

LT Foreign Currency Rating

Baa2/Prime-2 BBB- BBB

Outlook Stable Stable Stable

LT Foreign -Philippines

- BBB- -

/1 As of Sept 2017; /2 As of January 2017; /3 As of April 2017


CONFIDENTIAL

Thank you.

As of June 30, 2017

BPI Investor UpdateStrength and Quality in Earnings

BPI Investor Update - Bank of the Philippine Islands · PDF fileFounded in 1851, as Banco...

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