Analyst Presentation 2Q2019

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Analyst Presentation

First Half 2019 Results (Unaudited)

Jakarta, 15 August 2019

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Key Highlights

Expectation on domestic growth remains stable, in spite of challenging operating environment due to global trend tension

CIMB Niaga’s 1H19 PBT expanded strongly by 10.6% YoY and 8.4% QoQ

Improved operating income underpinned by increased NIM at 5.41% (1H18: 5.09%)

Total Loans grew 2.6% YoY from Mortgage (+13.5%), Credit Cards (+10%), SME (+4.1%), and Corporate (+2.1%). Auto loan recalibration showed positive QoQ growth

Gross NPL ratio lower by 52 bps to 2.87%, with Gross Impairment ratio improving to 3.17%

from 4.36% in 1H18

Higher ROA and ROE of 1.51% (+15bps YoY) and 9.75% (+38bps YoY) respectively. 2Q19 ROE stood at 10.1% (1Q19: 9.48%)

CAR rising 199 bps to 20.59% (1H18 : 18.60%), CET-1 at 19.38%

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CIMB Niaga: 1H 2019 Results

Financial Results

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(Rp bil) 1Q19 2Q19 QoQ 1H18 1H19 YoY

Interest Income 5,250 5,573 6.2% 9,955 10,823 8.7%

Interest Expense (2,212) (2,295) 3.8% (3,967) (4,507) 13.6%

Net Interest Income 3,038 3,278 7.9% 5,988 6,316 5.5%

Non Interest Income 1,032 950 (7.9%) 1,864 1,982 6.3%

Operating Income 4,070 4,228 3.9% 7,852 8,298 5.7%

Operating Expenses (2,073) (2,026) (2.3%) (3,879) (4,099) 5.7%

Pre Provision Operating Profit 1,997 2,202 10.3% 3,973 4,199 5.7%

Provision Expenses (712) (809) 13.6% (1,552) (1,521) (2.0%)

PBT 1,285 1,393 8.4% 2,421 2,677 10.6%

Net Profit 944 1,032 9.3% 1,768 1,976 11.8%

EPS (Rp, full amount) 37.87 41.40 9.3% 70.92 79.27 11.8%

Income Statement - Consolidated

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Financial Position - Consolidated

(Rp tril) Jun-18 Mar-19 Jun-19 QoQ YoY

Cash & Short Term Funds 23.15 22.09 32.26 46.0% 39.4%

Gov’t Bonds & Marketable Securities 38.94 37.90 32.85 (13.3%) (15.6%)

Loans 185.72 187.99 190.54 1.4% 2.6%

Loan Provision (6.61) (6.40) (5.45) (14.8%) (17.5%)

Fixed & Other Assets 18.88 21.24 21.66 2.0% 14.7%

Total Assets 260.08 262.82 271.86 3.4% 4.5%

Current Account 52.15 48.09 50.72 5.5% (2.7%)

Savings Account 54.64 54.32 55.91 2.9% 2.3%

Time Deposit & Structured Deposit 83.49 88.15 91.22 3.5% 9.3%

Total Customer Deposits 190.28 190.56 197.85 3.8% 4.0%

Other Liabilities 32.17 31.30 32.49 3.8% 1.0%

Total Liabilities 222.45 221.86 230.34 3.8% 3.5%

Equity 37.63 40.96 41.52 1.4% 10.3%

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Key Ratios

(%) 1Q19 2Q19 QoQ 1H18 1H19 YoY

ROA^*) 1.47 1.54 1.36 1.51

ROE (shareholders’ fund) 9.48 10.10 9.37 9.75

NIM 5.28 5.53 5.09 5.41

Fee Income / Total Income 25.36 22.47 23.74 23.89

Cost to Income (CIR) 50.93 47.92 49.40 49.40

CASA Ratio 53.74 53.89 56.12 53.89

Loan to Deposit (LDR) 97.02 94.67 95.93 94.67

Gross NPL 3.04 2.87 3.39 2.87 `

Net NPL 1.42 1.50 1.87 1.50

Cost of Credit 1.60 1.81 1.67 1.70

Gross Impairment Ratio 3.91 3.17 4.36 3.17

Loan Loss Coverage 113.76 101.20 106.83 101.20

Impaired LLC 86.92 90.10 81.65 90.10

*) PAT annualized/ average total assets

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(Rp bil)

Quarterly Earnings Trend

3,827 4,027 3,949 4,070 4,228

1,201 1,205 1,225 1,285 1,393

891 824 891 944 1,032

9.43%

8.52% 9.11% 9.48% 10.10%

2Q18 3Q18 4Q18 1Q19 2Q19

Operating Income PBT Net Profit ROE (shareholders' fund)

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Optimizing NIM Strategy

Consumer 40%

Commercial 7%

MSME 15%

Corporate 18%

Treasury 20%

5.09% 5.12% 5.12% 5.28% 5.41%

Jun-18 Sep-18 Dec-18 Mar-19 Jun-19

Net Interest Margin (%, YTD Annualized)

Net Interest Income Breakdown (incl. FTP)

Net Interest Income

1H18: Rp 5,988 billion 1H19: Rp 6,316 billion

Quarterly Annualized NIM

2Q18 3Q18 4Q18 1Q19 2Q19

5.03% 5.17% 5.11% 5.28% 5.53%

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Non Interest Income

(Rp bil) 1H18 1H19 YoY

327 257 (21.4%)

88 173 96.6%

81 66 (18.5%)

390 526 34.9%

978 960 (1.8%)

Bancassurance 391 285 (27.1%)

Funding & Admin Fee 153 184 20.3%

Remittance 49 40 (18.4%)

Card Related 184 253 37.5%

Other Fees & Commissions 201 198 (1.5%)

Total 1,864 1,982 6.3%

NoII – Quarterly

872 1,003 950 1,032 950

2Q18 3Q18 4Q18 1Q19 2Q19

978 960

390 526

81 66

88

173 327

257

1H18 1H19

Recovery

Arranger & Syndication Fees Trans. Banking & Trade Fin

Forex & Fixed Income Derivatives Fees & Commissions

Non Interest Income Breakdown

1,982 1,864

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Operating Expenses & Cost to Income Ratio

49.40% 50.03% 50.21% 50.93% 49.40%

YTD Cost to Income Ratio

YTD CIR (%)

Rp bil 1Q19 2Q19 QoQ 1H18 1H19 YoY

Personnel 1,043 1,002 (3.9%) 1,854 2,045 10.3%

Other Expenses 1,030 1,024 (0.6%) 2,025 2,054 1.4%

Total 2,073 2,026 (2.3%) 3,879 4,099 5.7%

(%) 1Q19 2Q19 QoQ 1H18 1H19 YoY

Cost to Income 50.93 47.92 -301bps 49.40 49.40 0bps

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Loans Growth

Segment (Rp tril) Jun 18 Mar 19 Jun 19 QoQ YoY

Consumer Banking (27%) 47.91 49.89 51.11 2.4% 6.7%

 Mortgages

27.97 31.03 31.75 2.3% 13.5%

 Credit Cards

8.13 8.58 8.94 4.2% 10.0%

 Auto Loans

7.34 6.11 6.17 1.0% (15.9%)

 Personal, Multipurpose & Others⁽¹⁾

4.47 4.17 4.25 1.9% (4.9%)

MSME Banking (19%) 35.82 37.28 36.88 (1.1%) 3.0%

 Small Medium Enterprise

28.11 29.78 29.25 (1.8%) 4.1%



Micro Linkage & Others 7.71 7.50 7.63 1.7% (1.0%)

Commercial Banking (16%) 32.04 31.35 31.15 (0.6%) (2.8%)

Corporate Banking (38%) 69.95 69.47 71.40 2.8% 2.1%

Total (100%) 185.72 187.99 190.54 1.4% 2.6%

(1) Others include Staff Loan & Pension Loan

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Asset Quality Management

106.83% 101.24% 105.86% 113.76%

101.20%

81.65% 78.43% 80.01% 86.92% 90.10%

Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Loan Loss Coverage Impaired LLC

Loans by Collectibility (% of Total Loan)

Coverage Ratio

Current 92.56%

Special Mention

4.40%

NPL 3.04%

Mar-19

Asset Quality

4.36% 4.33%

4.05% 3.91%

3.17%

3.39% 3.41% 3.11% 3.04%

2.87%

1.87% 1.82% 1.55% 1.42% 1.50%

Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Gross Impairment Ratio Gross NPL Net NPL

Current 93.19%

Special Mention

3.94%

NPL 2.87%

Jun-19 Current

90.47%

Special Mention

6.14%

NPL 3.39%

Jun-18

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Asset Quality by Business Segment

Gross NPL (%)

1.1% 1.5% 1.3% 1.0% 1.8%

9.3% 8.6% 7.9% 7.7%

5.0%

2.6% 2.9% 2.5% 2.4% 2.3%

Jun-18 Sep-18 Dec-18 Mar-19 Jun-19

3.2% 2.9% 3.0% 3.6% 3.5%

Corporate

Commercial

MSME

Consumer

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Capital Ratios

Total Equity (Rp tril) CAR (%) – Consolidated

Capital Adequacy Ratio (%) Jun-18 Mar-19 Jun-19

CAR with Credit Risk 21.70 24.00 24.18

Market Risk (0.20) (0.24) (0.20)

Operational Risk (2.90) (3.39) (3.39)

Total CAR 18.60 20.37 20.59

17.41 18.24 18.40 19.16 19.38 1.19 1.17 1.26 1.21 1.21

Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Tier 1 Tier 2

37.63 38.48 39.58 40.96 41.52

18.60 19.41 19.66 20.37 20.59

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CIMB Niaga: 1H 2019 Results

Consumer Banking

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Consumer Loans led by Mortgage

Growth

(Composition) QoQ YoY

Total 2.4% 6.7%

1.9% (4.9%)

1.0% (15.9%)

4.2% 10.0%

2.3% 13.5%

Total Loans

27.97 31.03 31.75

8.13 8.58 8.94

7.34 6.11 6.17

4.47 4.17 4.25

Jun-18 Mar-19 Jun-19

Personal, Pension Loan, Multipurpose & Others (8%) Auto Loans (12%)

Credit Cards (18%)

Mortgage (62%) 51.11

47.91

(Rp tril)

49.89

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Mortgages

Total Loans

Market Share

Mortgage Lender Jun-19

BTN 40.3%

BCA 18.5%

Mandiri 8.7%

BNI 8.6%

CIMB Niaga 6.5%

2.8% 2.7% 2.7%

27.97

31.03 31.75

(Rp tril)

6.4% 6.5% 6.5%

NPL Ratio Market Share

+13.5% YoY +2.3% QoQ

Industry Source: Bank Indonesia - Indonesia Economic and Financial Statistics (SEKI)

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Auto Loans

(Rp tril)

Growth QoQ YoY

Total 1.0% (15.9%)

12.9% 54.1%

(1.8%) (25.1%)

Total Loans

NPL Ratio 6.49

4.95 4.86 0.85

1.16 1.31

1.2% 1.4% 1.0%

Indirect Auto Loans CNAF*

7.34 6.17 6.11

*)

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2,569 2,554 2,539

Jun-18 Mar-19 Jun-19 14.9% 14.9% 14.7%

Market share*)

Unsecured Business

Number of Credit Cards Outstanding Balance

(‘000) (Rp tril)

*) Market share based on card issued (source: APMK - Bank Indonesia)

-0.6% QoQ -1.2% YoY

8.13 8.58 8.94

4.47 4.17 4.25

3.1%

2.1% 2.2%

Personal, Pension Loan, Multipurpose & Others Credit Card

NPL - unsecured business

12.60 12.75 ^{+3.5% QoQ}13.19

+4.7% YoY

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Strengthen our Digitalization

1,569 1,616 1,669 1,713 1,762 CIMB Clicks (in thou)

No of Transaction No of User

4,692 4,665

4,947

4,802 4,964

2Q18 3Q18 4Q18 1Q19 2Q19

1,966 2,077 2,194 2,303 2,402 Go Mobile (in thou)

No of Transaction No of User

4,385 3,873 4,316

7,633

10,537

2Q18 3Q18 4Q18 1Q19 2Q19

+12.3% YoY

+22.2% YoY

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CIMB Niaga: 1H 2019 Results

MSME Banking

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28.11 29.78 29.25

7.71 7.50 7.63

Micro Linkage & others Small Medium

Growth QoQ YoY

Total (1.1%) 3.0%

1.7% (1.0%) (1.8%) 4.1%

MSME Loans

Total Loans

35.82 37.28 36.88

(Rp tril)

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CIMB Niaga: 1H 2019 Results

Commercial Banking

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10.63 (33%)

10.57 (34%)

10.08 (32%) 21.41

(67%)

20.78 (66%)

21.07 (68%)

Working Capital Investment

Commercial Loans

Total Loans (Composition)

32.04 31.35 31.15

(Rp tril)

Growth QoQ YoY

Total (0.6%) (2.8%)

1.4% (1.6%) (4.6%) (5.2%)

Comba Jun- 18

Mar- 19

Jun-

19 CA 7.73 10.17 9.30

SA 0.48 0.53 0.63

TD 9.60 7.49 7.04

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CIMB Niaga: 1H 2019 Results

Corporate Banking

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Corporate Portfolio

Growth QoQ YoY

Total 2.8% 2.1%

(7.5%) (18.0%) 11.9% 24.3%

Total Loans (Composition)

(Rp tril)

69.95 69.47 71.40

33.15 (47%)

36.83 (53%)

41.21 (58%) 36.80

(53%)

32.64 (47%)

30.19 (42%)

Jun-18 Mar-19 Jun-19

Working Capital Investment

COBA Jun-18 Mar-19 Jun-19 CA 20.97 14.91 17.86

SA 0.03 0.04 0.05

TD 9.30 9.57 9.88

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CIMB Niaga: 1H 2019 Results

Syariah Banking

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21.25

28.04 27.96

0.98% 1.15% 1.21%

-3.00%

-2.50%

-2.00%

-1.50%

-1.00%

-0.50%

0.0 0%

0.5 0%

1.0 0%

1.5 0%

Financing NPF

Total Financing

(Rp tril)

+31.6% YoY -0.3% QoQ

19.74

26.52 27.17

Total Deposits

(Rp tril)

+37.6% YoY +2.5% QoQ

Syariah Banking

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CIMB Niaga: 1H 2019 Results

Final Remarks

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Final Remarks

Encouraging 1H19 revenue and growth momentum expected to carry into 2H19, particularly for Consumer and SME

Regulator actions expected to stimulate favourable growth environment with room for interest rate cuts and liquidity measures

CIMB Niaga Transformation gaining traction

Business focus on CASA, Transaction Banking, Data Analytics, Customer Experience and Asset Quality

Enabler focus on Operation efficiency, Automation and developing 3D human capital

Expecting smooth implementation of IFRS9 in 2020

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THANK YOU

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CIMB Niaga: 1H 2019 Results

Appendices

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Share Price and Ratings

Rating Agencies Rating / Outlook

Moody’s 4 June 2019

Outlook Bank Deposits

Adj. Baseline Credit Assessment Issuer Rating

Stable Baa2/P-2 baa2 Baa2

Fitch

23 Apr 2019

Foreign Currency

Long Term Foreign Currency IDR Short Term Foreign Currency IDR Support Rating

Viability Rating

BBB- / Stable F3

2 bb

Fitch 6 Mar 2019

National Ratings National Long Term National Short Term Subordinated Bonds II

AA+(idn) / Stable F1+(idn)

AA-(idn)

Pefindo 6 Sep 2018

Corporate Rating

Shelf Registration Bond Rating Subordinated Bonds III

Sukuk Mudharabah

idAAA/ Stable idAAA

IdAA idAAA(SY)

Share Price & Trading Volume

BNGA Jun-18 Sep-18 Dec-18 Mar-19 Jun-19

Price (Rp) 950 930 915 1,065 1,115

PBV (x) 0.63 0.61 0.60 0.65 0.68

PER 7.22 7.05 6.72 7.67 7.59

0 5000 10000 15000 20000 25000 30000 35000 40000 45000 50000

0 200 400 600 800 1000 1200 1400

Thou sand s

Share Price Trading Volume (RHS)

In IDR Thousands

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Corporate Structure – 30 June 2019

^ Includes PT Commerce Kapital 1.02%

EPF PNB KWAP

Khazanah Nasional

Public

26.99% 13.22% 12.30% 5.92%

7.5% 92.5%^

99.9%

CIMB Group Holdings Berhad

Others 41.57%

99.0%

*)

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Board of Commissioners

Tengku Dato’ Sri Zafrul Tengku Abdul Aziz

President Commissioner

Glenn M.S. Yusuf

Vice President Commissioner

Zulkifli M. Ali

Independent Commissioner

Pri Notowidigdo

Independent Commissioner Jeffrey Kairupan

David Richard Thomas

Commissioner

Sri Widowati

Didi Syafruddin Yahya

Commissioner

*) Effective after OJK approval

*) *)

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Rahardja Alimhamzah

Business Banking Director

Tigor M. Siahaan

President Director

Rita Mas’Oen

Operations & IT Director

Megawati Sutanto

Credit Director

Vera Handajani

Risk Management Director

John Simon

Treasury & Capital Market Director

Hedy Maria Helena Lapian

Human Resources Director

Fransiska Oei

Compliance, Corporate Affairs and

Legal Director

Pandji Pratama Djajanegara

Syariah Banking Director

Lani Darmawan

Consumer Banking Director

Lee Kai Kwong

Finance & SPAPM Director

Directors

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Vision & Mission

To be The Leading ASEAN Company

Vision Mission

To provide universal banking services in Indonesia as a

high-performing, institutionalised and

integrated company located in ASEAN and key markets beyond, and to champion the

acceleration of ASEAN

integration and the region’s

links to the rest of the world

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Network & Distribution Channel

Jun-18 Mar-19 Jun-19 QoQ YoY

Branch & Network

Branches* 455 418 408 (10) (47)

Payment & Cash Point 24 20 19 (1) (5)

Digital Lounge 26 27 28 1 2

Mobile Cash 22 27 27 - 5

Total Network 527 492 482 (10) (45)

Electronic Channels

ATM 4,568 4,497 4,505 8 (63)

CDM & CRM 761 951 941 (10) 180

MFD** 172 160 159 (1) (13)

EDC 61,969 92,143 103,189 11,046 41,220

Employees

Bank only 12,670 12,375 12,382 7 (288)

CNAF 950 1,007 874 (133) (76)

CNS n.a 15 19 4 n.a

Total Employees 13,620 13,397 13,275 (122) (345)

* Branches exclude Payment & Cash Point

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Notable Awards in 2Q 2019

 Corporate Banking and Investment of the Year – Indonesia

 Syndicated Loan of the Year – Indonesia

 Anugerah Produk Keuangan Terbaik 2019:

Pilihan Milenial, Top Kredit KPR 2019, Kategori Perbankan

 The Credit Risk Technology Implementation of the Year - 2019

 Indonesia’s Top 100 Most Valuable Brands 2019

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Annual General Shareholder Meeting (AGM). This meeting held on 15 Apr 19, with attendees include MC, Commissioner, DPS, Shareholders, Senior Leaders and Journalist. AGM was held to get approval on Company’s Consolidation Financial Statement from the year ended on 31 Dec 2018 and announce company performance to shareholders and other stakeholders. The meeting was using electronic voting (e-voting) during the voting from the shareholders.

“Avengers” see movie together with Merchants. This event was held in CGV studios across 5 cities (Jakarta, Medan, Yogyakarta, Surabaya, Bandung) on 25 Apr 2019. This event purpose was to improve and maintain relationship with merchant; as well as to improve transactions, sales volume and CASA from existing merchant. We encourage the use of Go Mobile in registration on process of ticket purchase to promote CIMB Niaga non-cash payment bank.

Syndication Signing between CIMB Niaga and Genesis Alternative Ventures. On 27 May 19 CIMB Niaga and Genesis Alternative Ventures signed agreement of collaboration. This collaboration purpose is to expand Indonesia start-up corporations with technology basis and financing ecosystem for Indonesia start-up co-operations. The cooperation with Genesis Alternative Ventures will strengthen CIMB Niaga’s position in financial technology expansion.

Corporate Activities in 2Q 2019

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THANK YOU

PT Bank CIMB Niaga Tbk

Investor Relations Graha CIMB Niaga

Jl. Jend. Sudirman No. Kav 58 Jakarta 12190

Tel. : (62-21) 270 0555 Fax. : (62-21) 250 5205

Email : [email protected]