Feb 2016 1 Vision We are geared to deliver a bold new world Our - - PowerPoint PPT Presentation

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Feb 2016 1 Vision We are geared to deliver a bold new world Our - - PowerPoint PPT Presentation

Dec 25, 2022 307 likes •549 views

Investor Presentation Feb 2016 1 Vision We are geared to deliver a bold new world Our Vision is to be the innovator of banking solutions to the wider Corporate, SME and Retail segments and to be their Bank of choice, through professional and

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Investor Presentation Feb 2016

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We are geared to deliver a bold new world

Vision

Our Vision is to be the innovator of banking solutions to the wider Corporate, SME and Retail segments and to be their Bank of choice, through professional and empowered people

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Mission

To our customers we provide the means of economic upliftment through customized banking and financial services. To our shareholders we provide a return on their investment above industry norm. To our staff we are a learning and innovative organization providing opportunities for faster career progression within a pleasant work environment. We adhere to the practice of good Corporate Governance in the eyes of the regulatory authorities. We are conscious of the need to be a responsible corporate citizen for the betterment of

  • ur society
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Key Company Milestones

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Established as the 8th indigenous Commercial Bank First bank to launch Internet banking Restructuring of the bank through a Sampath Bank led consortium Landmark investment from Middle East - Royal Family of Saudi Arabia Listed in the CSE, Highest

  • versubscribed IPO

Acquisition of NAMAL and UB Finance CFI award for Best SME Bank TPG through its affiliate Culture Finance Holding strikes landmark deal with Union Bank New Core-Banking system Implementation First bank in Sri Lanka to implement Microsoft cloud technology 64 branches with access to over 2,700 ATM’S

2014-2015 2011-2013 2001-2010 1995-2000

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Increasing footprint and reach

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Channels 2012 2013 2014 2015

Branches 36 51 61 64 ATMS 35 50 61 103

2014 2015

Western 23 26 North Western 7 7 Southern 7 7 Central 5 5 North Central 5 5 Northern 5 5 Sabaragamuwa 5 5 Eastern 2 2 Uva 2 2 Total 61 64

Province

  • Num. of Branches

We are rapidly growing our footprint and reach

26 7 7 5 5 5 5 2 2

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New branch outlook 22 branches were refurbished during the year

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Elite Circle launched

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People Management

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Select Energize Value Develop Select, recruit and promote based on competency. Position UB as an employer of choice externally. Develop capability so that employees are equipped to do their jobs as well as develop within the Bank. Engage and energize employees so that they can perform at their best Value employees and recognize the contributions they make

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Financial Overview - Bank

“ 2015 was a significant year of growth and preparation, in which we laid a strong foundation that would become the launch pad for robust growth in the ensuring years” – CEO

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2015 LKR Mn YoY Growth

Net Interest Income 2,021 15% Total Operating income 2,839 24% Operating Cost 2,335 42% Net Profit for the period 193 238% Loans and Advances 40,095 55% Customer Deposits 37,653 35% Total Assets 71,005 45%

Snapshot 2015 – Strong Performance Profit for Shareholders grew by 238%

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Financial Performance – Income Statement

2015 2015 YoY Growth Net Interest Income 2,021 15% Net Fee and commission income 181 18% Net Trading and other operating income 637 69% Total Operating income 2,839 24% Operating Cost 2,335 42% Impairment 177

  • 67%

Net profit before taxes and VAT on FS 328 191% Taxes including VAT on FS 135 144% Net Profit for the period 193 238%

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Revenue Generation

NII 77% OI 23%

2014 2015

OI 29% NII 71%

Total operating income grew by 24%

Incremental Income 2015 LKR Mn YoY

NII 259 15% Fee Income 27 18% Trading & Others 260 69%

Source: CBSL, Research estimates *OI – Other income

22% 34% 44%

Fee & Commission income Trading Other operating income

982 1,233 1,155 1,734 2,021

0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 4.00% 4.50% 5.00%

  • 1,000

2,000 3,000 4,000 5,000

2011 2012 2013 2014 2015

LKR Mn

NII NIM Industry NIM

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Operating Expenses

2014 2015

The increase in cost was in line with our strategic initiatives.

Incremental cost 2015 LKR Mn YoY

Staff Cost 333 50% Depreciation & Amortization 66 25% Other Operating cost 296 42%

Cost to income ratio % 2014 2015

72.9% 81.8% Expense distribution 2014 2015

Staff Cost 40% 43% Depreciation & Amortization 17% 14% Other Operating cost 43% 43%

Operating Expenses (LKR Mn)

2014 2015

1,640 2,335 Staff Cost D&A Other Operating cost

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LKR Mn YoY

Cash and balances with banks 2,811 17% Reverse REPO 1,513

  • 86%

Placement with banks 284 284% Loans & Receivables 40,095 55% Investment in units 7,985 327% Other interest earning assets 14,709 195% Investment in subsidiaries 892 0% Non interest earning assets 2,716 19% Total Assets 71,005 45% Customer Deposits 37,652 35% Due to banks and repurchased agreements 15,188 374% Non interest earning liabilities 1,243 1% Equity 16,922 1% Total Equity and Liabilities 71,005 45%

Statement of financial position – (Bank)

Total Assets (LKR Mn) Loans (LKR Mn) 2014 2015

71,005 48,990

Deposits (LKR Mn) 2014 2015 2014 2015

25,944 40,095 27,808 37,652

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Segmental dispersion of Loans

52% 42% 6%

Corporate SME Retail

8% 16% 69% 6%

CA SA FD CD

Financial Position - Composition of the Balance Sheet

Product composition of Deposits Assets Funding

Loans - 56% Treasury Assets - 32% Deposits - 53% Borrowings - 22%

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Financial Position - Balance Sheet growth

Loans Deposits Total Assets

55% 35%

Union Bank Growth Industry Growth

20-23% Est.

2015 2014

Union Bank Growth Industry Growth

17-20% Est.

Union Bank Growth

45%

Industry Growth

18-20% Est.

Source : Based on research estimates * The industry data is based on the top eight listed banks

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Loans and Receivables Capital Adequacy

Financial Position - Loan Growth & Capital Adequacy

52% 42% 6%

Corporate SME Retail

We maintained a healthy capital adequacy ratio despite

  • ur robust loan growth in 2015

2015 2014

  • 5,000

10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000

2011 2012 2013 2014 2015

LKR Mn 40% 60%

Corporate SME

0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

2011 2012 2013 2014 2015 Tier 1 Tier 2

Tier 2 Tier 1

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Customer Deposits CASA

Financial Position - Deposit Growth & CASA

CASA grew by 31% in 2015 8% 16% 69% 6%

CA SA FD CD

0% 5% 10% 15% 20% 25% 30%

  • 2,000

4,000 6,000 8,000 10,000

2011 2012 2013 2014 2015

LKR Mn

CASA CASA Ratio

  • 5,000

10,000 15,000 20,000 25,000 30,000 35,000 40,000

2011 2012 2013 2014 2015

LKR Mn

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Gross NPL – Last 18 months

Significant progress over the last 18 months has been made with regard to NPL’s despite our aggressive loan growth. Net NPL for 2015 was 2.7%

Note: Based on CBSL classification

2.00% 4.00% 6.00% 8.00% 10.00% 12.00% 14.00% 16.00%

Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 2015 2014

Asset quality overview

25% 23% 18% 12% 23% Traders Manufacturing Financial and Business Services Agriculture & Fishing Other

Sector wise Exposure

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Key Indicators - Bank

Performance Indicators

2014 2015

Return on Equity 0.7% 1.1% Return on Assets 0.1% 0.3% Net Interest Margin 4.2% 3.4% Gross - Non Performing Loans 8.3% 3.6% Net – Non Performing Loans 7.4% 2.7% Total Capital Adequacy 41.5% 23.6%

Net Asset value per share (Rs)

2014 2015

15.50 15.35

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Financial Performance – Group

2015 2015 YoY Growth Net Interest Income 2,440 24% Net Fee and commission income 343 17% Net Trading and other operating income 652 36% Total Operating income 3,436 25% Operating Cost 2,747 38% Impairment 260

  • 51%

Net profit before taxes and VAT on FS 428 84% Taxes including VAT on FS 174 12% Net Profit for the period 255 226%

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LKR Mn YoY

Cash and balances with banks 3,015 12% Reverse REPO 1,619

  • 85%

Placement with banks 294 58% Loans & Receivables 45,450 56% Investment in units 7,985 327% Other interest earning assets 14,135 227% Investment in real estate 213

  • 18%

Non interest earning assets 3,831 14% Total Assets 76,542 46% Customer Deposits 41,624 37% Due to banks and repurchased agreements 15,150 367% Non interest earning liabilities 3,053 22% Equity 16,715 1% Total Equity and Liabilities 76,542 46%

Statement of financial position – (Bank)

Total Assets (LKR Mn) Loans (LKR Mn) 2014 2015

76,542 52,558

Deposits (LKR Mn) 2014 2015 2014 2015

29,217 45,450 30,324 41,623

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Board of Directors

Name Title

  • P. Jayendra Nayak

Chairman Alexis Lovell Deputy Chairman Asoka de Silva Senior Director Indrajit Wickramasinghe Executive Director/ CEO Sow Lin Chiew Non Independent, Non Executive Director Priyantha Fernando Independent, Non Executive Director Sabry Ghouse Independent, Non Executive Director Hussain Imtiaz Muhseen Independent, Non Executive Director Ranvir Dewan Non Independent, Non Executive Director Gaurav Trehan Non Independent, Non Executive Director Puneet Bhatia Non Independent, Non Executive Director Michael J. O’Hanlon Non Independent, Non Executive Director Ayomi Aluwihare Independent, Non Executive Director Sumedh Jog Alternate Director Yoke Sun Woon Alternate Director

Legal Form

A Public Limited Liability Company incorporated in Sri Lanka under the Companies Act No. 17 of 1982. Re-registered under the Companies Act No. 7 of 2007. Listed as a public quoted Company at the Colombo Stock Exchange in 2011. A Licensed Commercial Bank under the Banking Act

  • No. 30 of 1988.

Date of Incorporation

February 2nd, 1995

Auditors

Ernst & Young Chartered Accountants,

  • No. 201, De Saram Place

Colombo 10

Leadership Team

Name Title Indrajit Wickramasinghe Director/ Chief Executive Officer Hiranthi de Silva Vice President Wholesale Banking Malinda Samaratunga Chief Financial Officer Ravi Divulwewa Vice President Credit Rajeev Munasinghe Vice President Information Technology Ravi Jayasekera Vice President Human Resources

  • S. Sri Ganendran

Vice President Operations Chaya Jayawardena Vice President Retail Banking Suhen Vanigasooriya Chief Risk Officer

Corporate Information