February 21st, 2019 Speakers: Mr. Aameer Karachiwalla - Chief - - PowerPoint PPT Presentation

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February 21st, 2019 Speakers: Mr. Aameer Karachiwalla - Chief - - PowerPoint PPT Presentation

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Performance Highlights FY 2018 Investor Relations Conference Call February 21st, 2019 Speakers: Mr. Aameer Karachiwalla - Chief Financial Officer Investor Relations Release Mr. Arif Saifie, FCA, CFA - Financial Controller and Head of

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SLIDE 1

UBL Performance Overview – FY 2018

Performance Highlights – FY 2018 Investor Relations Conference Call February 21st, 2019

Speakers:

  • Mr. Aameer Karachiwalla - Chief Financial Officer
  • Mr. Arif Saifie, FCA, CFA - Financial Controller and Head of Investor Relations

Investor Relations Release

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SLIDE 2

UBL Performance Overview – FY 2018

Table of Contents 3 7 29 PAGE

Key Highlights Growth at a Glance Execution and Delivery Quarterly Trend Analysis

25

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SLIDE 3

UBL Performance Overview – FY 2018

3

  • PBT before extraordinary items at Rs. 31.6 bln, down 21% vs. FY’17
  • PBT at Rs. 25.0 bln, down 37% vs. FY’17

Major upsides building core earnings in FY’18:

  • Average domestic current deposits at Rs. 454 bln, up 15% vs. FY’17
  • Average CASA for the period was 86.9% (FY’17: 82.8%)
  • Domestic cost of deposits maintained at 3.02% (FY’17: 2.73%) – despite rate hike of 425bps in 2018
  • Strong build up in Domestic fees - up by 20% YoY to reach Rs. 11.9 bln in FY’18
  • FX income increased by 85% to Rs 3.5 bln in FY’18
  • Overall Bank revenues up by 3%, closing at Rs. 81.3 bln in FY’18
  • Overall expenses growth well contained at 2% - FY’18 vs FY’17 (WWF Reversal of Rs. 2.7 bln in FY’18)
  • CAR has improved from 15.45% in Dec’17 to 17.74% in Dec’18

Major one offs and downsides impacting results in FY’18:

  • Rs. 6.7 bln recorded as pension liability (Q1’18: Rs. 6.4 bln; Q2’18: Rs. 2.0 bln; Q3’18: Rs. 0.3 bln; Q4’18:

Reversal of Rs. 2.1 bln)

  • International Provisions of Rs. 11.2 bln taken in FY’18 (Q1’18 Rs 2.7 bln; Q2’18: Rs 2.4 bln; Q3’18: Rs 1.8 bln;

Q4’18: Rs. 4.3 bln) to build coverage from 58% in Dec’17 to 74% in Dec’18.

Key Performance Highlights

UBL Standalone Results

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SLIDE 4

UBL Performance Overview – FY 2018

  • Net Interest Income of Rs. 56.2 bln in FY’18 (FY’17: Rs. 56.4 bln)
  • 586,000 NTB current accounts mobilized in FY’18 (FY’17: 586,000)
  • Growth led by current deposits – average growth of 15%, incremental vol. of Rs. 60 bln
  • Domestic CASA of 86.8% at Dec’18 end (Dec’17: 84.5%). Current to total deposits ratio at 45.9%

(Dec’17: 43.4%). Average domestic deposits grew by 5% year on year

  • Average performing advances growth of 23% - Domestic up 35%, International down 17%
  • Growth led by Corporate – average loan book expansion of 31%
  • Average Consumer portfolio grew 36% to Rs. 14 bln, SME lending up 25% to Rs. 31 bln
  • PIBs portfolio at Rs 410 bln (Dec’17: Rs 542 bln) - maturities of Rs 97 bln in FY’18
  • Repo book reduced from Rs. 450 bln at Dec’17 to Rs. 131 bln at Dec’18 end

4

Branch Banking builds deposit base in cost efficient manner

  • Avg. Total Assets of Rs. 1.80 tln in FY’18, a growth of 3% over FY’17
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SLIDE 5

UBL Performance Overview – FY 2018

5

Overall NFI closed at Rs. 25.1 bln in FY’18, a 13% growth over FY’17

DOM FX revenue up by Rs 1.9 bln to Rs. 3.6 bln in FY’18 – amidst higher FX volumes Fee income stood at Rs. 13.9 bln, up 10% from FY’17

1

  • Domestic fees grew by 20% YoY to reach Rs. 11.9 bln in FY’18:–
  • Branch banking customer fees up by 14% to reach Rs. 1.6 bln (FY’17: Rs. 1.4 bln
  • Debit & Credit Cards fees up by 27% to reach Rs. 1.6 bln (FY’17: Rs. 1.3 bln)
  • Remittances including home remittances revenues grew by 41% to reach Rs. 2.5 bln - Home

remittances market share up to 29% (FY’17: 26.5%)

  • Trade commissions growth of 8% to reach Rs. 523 mln
  • Banca revenues up 37% to reach Rs. 1.6 bln (FY’17: Rs. 1.2 bln)
  • Cash management commissions grew by 17% over FY’17 to reach Rs. 694 mln
  • Investment Banking fees up by 17% to reach Rs. 704 mln

Dividend income of Rs. 2.1 bln (FY’17: 2.4 bln) – yield of 9.3% (FY’17: 10.3%)

2

Capital gains of Rs. 4.6 bln realized (FY’17: Rs. 4.4 bln) – mainly on the PIBs portfolio

3

FX income increased by 85% to Rs. 3.5 bln in FY’18

4

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SLIDE 6

UBL Performance Overview – FY 2018

  • DOM net provision charge of Rs. 1.7 bln in FY’18 (FY’17: net reversal of Rs. 2.3 bln)
  • DOM asset quality stood at 4.9% at the end of Dec’18 (Dec’17: 6.0%)
  • International provisions of USD 91.9 mln taken in FY’18 (FY’17: USD 45.2 mln)
  • Overall NPLs closed at Rs. 68.6 bln at Dec’18 (Dec’17: Rs. 52.2 bln)
  • International NPLs at USD 293 mln at Dec’18 (Dec’17: USD 218 mln)
  • International coverage stood at 74% in Dec’18 (Dec’17: 58%)
  • Overall asset quality maintained at 8.8% (Dec’17: 7.8%)
  • At Bank level specific coverage at 82% (Dec’17: 75%) – DOM coverage at 93% (Dec’17: 91%)

6

Net provision charge of Rs. 12.9 bln in FY’18 vs. Rs. 2.4 bln in FY’17 Administrative expenses stood at Rs. 38.8 bln, excluding DPC up 8% YoY

  • Total staff costs up 10% in FY’18 to reach Rs. 15.4 bln (DOM: Rs. 11.6 bln up 10% YoY)
  • Property expenses up 8% in FY’18 to reach Rs. 7.3 bln (DOM: Rs. 6.3 bln up 7% YoY)
  • Information technology expenses up 16% in FY’18 to reach Rs. 2.8 bln (DOM: Rs. 2.4 bln up

14% YoY)

  • Other operating expenses up 9% in FY’18 to reach Rs. 13.3 bln (DOM: Rs. 10.7 bln up 11%

YoY)

Provisions and Loan Losses

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SLIDE 7

UBL Performance Overview – FY 2018

7

Execution and Delivery

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SLIDE 8

UBL Performance Overview – FY 2018

50% 75% 85% 100% 115% 130% 130% 130% 110% 54.8% 59.2% 58.2% 65.8% 64.2% 61.9% 57.4% 63.2% 69.3% 0% 10% 20% 30% 40% 50% 60% 70% 80% 0% 20% 40% 60% 80% 100% 120% 140% 2010 2011 2012 2013 2014 2015 2016 2017 2018 Cash Dividend Dividend Payout Ratio

8

Consistent earnings performance throughout the years

Equity and Book Values Dividend Payout EPS & Price Earnings Ratio Trends - KSE 100 Index and UBL’s share price

*

* Payout for 2018 is computed on normalized PAT excluding the effect of one-off pension cost

68 79 92 101 126 142 152 159 151 56 65 75 82 103 116 124 130 124 2010 2011 2012 2013 2014 2015 2016 2017 2018

Total Equity - St. BV Per share - St. Rs in bln

  • Cons. Equity Dec’18 - Rs. 168 bln
  • Cons. Book value Dec’18 - Rs. 138 per share

25 30 35 40 45 50 55 100 120 140 160 180 200 220 240 260 280 300

Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 UBL's share price KSE 100 Index Max 2018: Rs. 215.16 31 Dec’18: Rs. 122.64 20 Feb'19: Rs. 157.47

Dec'10 Dec'11 Dec'12 Dec'13 Dec'14 Dec'15 Dec'16 Dec'17 Dec'18 EPS 9.1 12.7 14.7 15.2 17.9 21.0 22.7 20.6 12.4 PE 7.5 4.1 5.7 8.7 9.9 7.4 10.5 9.1 9.9

0.7 5.6 10.4 15.3 20.1 25.0 2.0 5.6 9.2 12.8 16.4 20.0

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SLIDE 9

UBL Performance Overview – FY 2018

Income Statement - Standalone

9

FY'18 FY'17 Var % Q4'18 Q3'18 Var % Interest Earned 113.2 107.2 5.6% 29.3 29.7

  • 1.4%

Interest Expensed (57.0) (50.8)

  • 12.2%

(15.0) (15.9) 5.8% Net Interest Income 56.2 56.4

  • 0.3%

14.4 13.8 3.8% Non Interest Income 25.1 22.2 13.1% 5.7 5.1 10.1% Total Revenue 81.3 78.6 3.5% 20.0 19.0 5.5%

  • Admin. Expenses

(38.8) (35.3)

  • 9.8%

(10.7) (9.6)

  • 10.7%

Total Expenses (36.8) (36.2)

  • 1.5%

(8.2) (9.8) 16.9% Pre Prov. Operating Profit 44.5 42.4 5.1% 11.9 9.1 29.6% Provision Exp./Other writeoffs (12.9) (2.4)

  • 427.1%

(5.5) (2.9)

  • 87.7%

Profit Before Extra Ordinary / Unususal Item and Tax 31.6 39.9

  • 20.8%

6.4 6.2 2.4% Extra Ordinary / Unususal Item - Pension Cost (6.7)

  • 100.0%

2.1 (0.3) 711.0% Profit Before Tax 25.0 39.9

  • 37.5%

8.5 5.9 43.8% Profit After Tax 15.2 27.6

  • 44.9%

5.5 3.5 58.8% Rs in bln Rs in bln

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SLIDE 10

UBL Performance Overview – FY 2018

Income Statement - Domestic

10

FY'18 FY'17 Var % Q4'18 Q3'18 Var % Interest Earned 98.4 93.2 5.6% 25.4 25.9

  • 1.9%

Interest Expensed (50.7) (45.2)

  • 12.1%

(13.3) (14.3) 6.9% Net Interest Income 47.7 48.0

  • 0.5%

12.1 11.6 4.4% Non Interest Income 23.0 19.0 21.0% 5.6 4.4 28.6% Total Revenue 70.7 67.0 5.6% 17.7 16.0 11.1%

  • Admin. Expenses

(31.0) (28.2)

  • 10.2%

(7.9) (8.1) 2.8% Total Expenses (29.1) (29.1)

  • 0.3%

(5.9) (8.1) 26.9% Pre Prov. Operating Profit 41.6 37.9 9.6% 11.8 7.8 50.2% Provision Exp./Other writeoffs (1.7) 2.6

  • 167.2%

(1.2) (1.1)

  • 8.6%

Profit Before Extra Ordinary / Unususal Item and Tax 39.9 40.5

  • 1.6%

10.6 6.8 56.9% Extra Ordinary / Unususal Item - Pension Cost (6.7)

  • 100.0%

2.1 (0.3) 721.8% Profit Before Tax 33.2 40.5

  • 18.0%

12.7 6.4 97.5% Profit After Tax 20.6 24.9

  • 17.3%

7.9 4.8 64.3% Rs in bln Rs in bln

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SLIDE 11

UBL Performance Overview – FY 2018

Balance Sheet - Standalone

11

Dec'18 Dec'17 Var % Advances 716 627 14.1% Investments 786 1,092

  • 28.0%

Lendings to Financial Institutions 34 11 212.3% Others 353 303 16.6% Total Assets 1,890 2,033

  • 7.1%

Deposits 1,366 1,273 7.3% Borrowings 268 513

  • 47.7%

Subordinated Debts 9

  • 100.0%

Others 95 88 7.9% Total Liabilities 1,738 1,874

  • 7.2%

Net Assets 151 159

  • 5.0%

Share Capital 12 12 0.0% Reserves 54 44 24.2% Unappropriated Profit 68 71

  • 4.1%

Surplus on revaluation of Assets 17 32

  • 48.7%

Total Equity including Surplus 151 159

  • 5.0%

Rs in bln

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SLIDE 12

UBL Performance Overview – FY 2018

12

Income Statement - Consolidated

FY'18 FY'17 Var % Q4'18 Q3'18 Var % Interest Earned 117.4 110.6 6.1% 30.4 30.8

  • 1.5%

Interest Expensed (59.1) (52.5)

  • 12.6%

(15.6) (16.5) 5.4% Net Interest Income 58.2 58.1 0.3% 14.8 14.4 3.0% Non Interest Income 27.3 24.8 10.5% 6.1 5.8 6.4% Total Revenue 85.6 82.8 3.3% 20.9 20.1 4.0%

  • Admin. Expenses

(42.5) (38.5)

  • 10.5%

(11.8) (10.5)

  • 12.3%

Total Expenses (40.4) (39.3)

  • 2.8%

(9.2) (10.6) 13.2% Pre Prov. Operating Profit 45.1 43.5 3.7% 11.7 9.5 23.3% Provision Exp./Other writeoffs (13.1) (2.6)

  • 398.4%

(5.1) (3.2)

  • 57.7%

Profit Before Extra Ordinary / Unususal Item and Tax 32.0 40.9

  • 21.6%

6.6 6.2 5.5% Extra Ordinary / Unususal Item - Pension Cost (6.7)

  • 100.0%

2.1 (0.3) 711.0% Profit Before Tax 25.4 40.9

  • 37.9%

8.7 5.9 47.0% Profit After Tax 15.0 26.0

  • 42.0%

5.6 3.4 64.3% Rs in bln Rs in bln

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SLIDE 13

UBL Performance Overview – FY 2018

Balance Sheet - Consolidated

13

Dec'18 Dec'17 Var % Advances 755 665 13.4% Investments 831 1,125

  • 26.1%

Lendings to Financial Institutions 35 13 169.9% Others 381 328 16.4% Total Assets 2,002 2,131

  • 6.0%

Deposits 1,448 1,350 7.3% Borrowings 280 517

  • 45.9%

Subordinated Loans 9

  • 100.0%

Others 97 90 7.8% Total Liabilities 1,834 1,956

  • 6.3%

Net Assets 169 174

  • 3.4%

Share Capital 12 12 0.0% Reserves 60 47 27.3% Unappropriated Profit 74 76

  • 3.5%

Surplus on revaluation of Assets 17 33

  • 48.7%

Total Equity attributable to euity holders of Bank 163 169

  • 3.5%

Non-controlling Interest (NCI) 6 5 1.2% Total Equity + NCI 169 174

  • 3.4%

Rs in bln

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SLIDE 14

UBL Performance Overview – FY 2018

14

Deposits - Bank

Deposits performance - Focus remains on growing low cost deposits

Cost of Deposits

Dec'18 Dec'17 FY'18 FY'17 FY'18 FY'17 Domestic deposits - Rs in bln 1,106 1,016 1,017 969 3.0% 2.7% International deposits - Rs in bln 260 256 254 235 2.2% 2.2% Total Bank - Rs in bln 1,366 1,273 1,271 1,204 2.9% 2.6% International - USD in mln 1,869 2,322 2,086 2,227 2.2% 2.2% Domestic CASA 86.8% 84.5% 86.9% 82.8% Domestic Current to Total Deposits 45.9% 43.4% 44.6% 40.6% Cost of Deposits Average Period End

3.8% 2.2% 3.5% 0.0% 1.0% 2.0% 3.0% 4.0% 5.0%

Q1'13Q2'13Q3'13Q4'13Q1'14Q2'14Q3'14Q4'14Q1'15Q2'15Q3'15Q4'15Q1'16Q2'16Q3'16Q4'16Q1'17Q2'17Q3'17Q4'17Q1'18Q2'18Q3'18Q4'18

Domestic International Bank

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SLIDE 15

UBL Performance Overview – FY 2018

15

Advances portfolio up 14% over Dec’17 Net Advances Dec'18 Dec'17 Var % Corporate Bank 374 303 23% Commodity 68 47 45% Commercial 43 35 20% Consumer 16 12 34% Others 44 43 2% Total Domestic 545 441 24% International 171 187

  • 8%

Bank 716 627 14% International USD mln 1,232 1,691

  • 27%

Rs in bln

374 303 68 47 43 35 16 12 171 187 44 43 Dec'18 Dec'17 Corporate Bank Commodity Commercial Bank Consumer Bank International Others

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SLIDE 16

UBL Performance Overview – FY 2018

International Advances - Corporate advances remains the largest component

16

Dubai, 65% Abu Dhabi, 29% Sharjah, 6%

By Business - UAE By Geography

UAE, 75% Bahrain, 14% Qatar, 11% Yemen, 0%NewYork, 0% EPZ, 0%

Corporate, 66% Consumer, 4% Others, 30%

Baitna, 98% Personal loan, 1% Others, 1%

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SLIDE 17

UBL Performance Overview – FY 2018

Concentration of Advances as at December 31, 2018 - Standalone

17

2% 2% 10% 1% 1% 2% 9% 2% 29% 4% 38% Chemical & Pharma Agribusiness Textile Cement Sugar Autos & Transport Financial Electronics Power & Energy Individuals Others

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SLIDE 18

UBL Performance Overview – FY 2018

Diversified investment portfolio with strong market risk management

Investments’ yields Non Funded revenue streams continue to grow Portfolio declines in line with reduced leveraging 18

243 414 396 548 17 18 41 40 57 48 34 24

Dec'18 Dec'17

T Bills PIBs Listed shares GoP Sukuks / Eurobonds Foreign bonds Others

Rs in bln Total 1,092 Total 786 10.4% 11.1% 10.4% 8.9% 7.8% 7.6% 2013 2014 2015 2016 2017 2018 2,361 2,087 1,878 3,465 4,401 4,622 2017 2018 Capital gains FX income Dividend

Rs in mln

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SLIDE 19

UBL Performance Overview – FY 2018

Our international outreach - serving in 4 continents under the single “UBL” brand

19

OVERSEAS BRANCHES 17 PAKISTAN BRANCHES 1,362 SUBSIDIARIES 4 ASSOCIATED COMPANIES 3

Globally around 23% of our asset base is located overseas

Asset mix by region 2018 2017 Domestic Operations 77.3% 79.9% International Operations 22.7% 20.1% Middle East 16.4% 14.9% USA 0.1% 0.3% Europe 5.7% 4.6% Africa 0.3% 0.2% EPZ 0.2% 0.1%

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SLIDE 20

UBL Performance Overview – FY 2018

UBL Innovation and Awards

UBL “Firsts” – Initiatives to stay ahead of the market Market recognition and awards

 First Commercial Bank in Pakistan to launch Branchless

Banking (UBL OMNI)

 First Bank in the world to issue VISA Debit Cards for

G2P assistance to affectees

 First Bank to provide Instantaneous ATM/Debit cards to

branchless banking customers at the time of account

  • pening (UBL Omni)

 First Pakistani Bank to be granted status of Authorized

Derivative Dealer (ADD) in Pakistan and First institution from Pakistan and third in South Asia to be accredited with Primary Membership of International Swaps and Derivatives Association

 First Bank in Pakistan to offer Prepaid VISA Debit Card  First Bank in Pakistan to offer Verified by Visa Service  First Bank in Pakistan where customer’s inward

remittances are deposited automatically on an ATM and VISA enabled debit card (UBL Tezraftaar Pardes Card)

Declared ‘Bank of the Year 2018 – Pakistan’ by The Banker, an affiliate of the Financial Times UK.

“Best Bank” in the first ever Pakistan Banking Awards 2016

“Best Bank for Corporate Finance and Capital Market Development” in the Pakistan Banking Awards 2017

JCR-VIS reaffirmed UBL’s entity ratings at AAA/A-1+ (Triple A / A- One Plus)

“Innovation Award” at the Mastercard Innovation Forum for ‘Launch of UBL MasterPass QR’

“National Medal of Innovation Award” 2016 for Pioneering G2P Payments – Pakistan Innovation Foundation

Top 25 Companies Award by the Karachi Stock Exchange for 2010- 2012, 2015 and 2016

“Best Bank for SMEs” by the Asia Money Pakistan Banking Awards in 2017

2012 & 2013 Bank of the Year in Pakistan Award by The Banker Magazine, an affiliate of the Financial Times, UK

ASIAMONEY Best Domestic Bank Award for 2011 and 2012

Recognized globally in 2013 as one of the 14 “Sprinters” by the GSMA’s Mobile Money for the Unbanked (MMU) program, being the only bank in the category

GSMA Global Mobile Award 2012 for “Best Use of Mobile in Emergency or Humanitarian Situations” and Financial Insights Innovation Award for “Innovation in Cash Disbursements (G2P)”

Recognized by CFA Pakistan Society for the “Best Investor Relations” function in 2013 and 2014

20

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SLIDE 21

UBL Performance Overview – FY 2018

21

Review of Non Interest Income & Administrative Expenses

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SLIDE 22

UBL Performance Overview – FY 2018

22

Non Fund Income Standalone Results

FY'18 FY'17 Var % Fee, commission and brokerage income 11,926 9,957 20% Dividend income 2,079 2,354

  • 12%

Income from dealing in foreign currencies 3,633 1,768 105% Gain / (loss) on sale of securities 4,518 4,174 8% Other income 869 783 11% Domestic Total 23,026 19,036 21% International Total 2,046 3,126

  • 35%

Bank Total 25,072 22,162 13% International Total - USD in '000 16,787 29,650

  • 43%

Rs in mln

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SLIDE 23

UBL Performance Overview – FY 2018

23

Fees and Commissions performance Standalone Results

FY'18 FY'18 Var % Branch banking customer fees 1,556 1,362 14% Consumer finance related fees 812 693 17% Card related fees (debit and credit cards) 1,590 1,253 27% Investment banking fees 704 600 17% Financial Institution rebate / commission 275 131 111% Corporate service charges / facility fee 205 203 1% Commission on trade 523 483 8% Commission on guarantees 391 426

  • 8%

Commission on cash management 694 593 17% Commission on remittances including home remittances - net 2,529 1,798 41% Commission on bancassurance 1,592 1,162 37% Commission on Benazir Income Support Program 569 751

  • 24%

Others 486 502

  • 3%

Domestic Total 11,926 9,957 20% International Total 2,005 2,661

  • 25%

Bank Total 13,931 12,618 10% International Total - USD in '000 16,787 29,650

  • 43%

Rs in mln

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SLIDE 24

UBL Performance Overview – FY 2018

24

Administrative Expenses Standalone Results

FY'18 FY'18 Var % Total compensation expenses 11,609 10,531

  • 10%

Rent and taxes 2,452 2,070

  • 18%

Utilities cost 1,562 1,469

  • 6%

Security 1,081 1,190 9% Depreciation 643 537

  • 20%

Others 572 605 6% Property expenses 6,311 5,872

  • 7%

Hardware & Software Maintenance 856 900 5% Depreciation & Amortisation 964 771

  • 25%

Network charges 580 440

  • 32%

Information technology expenses 2,400 2,111

  • 14%

Legal and professional charges 389 270

  • 44%

Outsourced service costs including sales commission 3,272 3,090

  • 6%

Banking service charges 1,162 897

  • 29%

Cash transportation and sorting charges 1,019 875

  • 16%

Depreciation 1,199 1,081

  • 11%

Stationery and printing 669 597

  • 12%

Marketing, advertisement and publicity 652 1,015 36% Insurance (including deposit protection) 682 100

  • 581%

Donations 203 110

  • 85%

Others 1,481 1,645 10% Other operating expenses 10,729 9,682

  • 11%

Domestic Total 31,048 28,195

  • 10%

International Total 7,779 7,155

  • 9%

Bank Total 38,827 35,350

  • 10%

International Total - USD in '000 63,867 67,856 6% Rs in mln

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SLIDE 25

UBL Performance Overview – FY 2018

25

Growth at a Glance

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SLIDE 26

UBL Performance Overview – FY 2018

26

Balance Sheet

  • Rs. in mlns

2018 2017 2016 2015 2014 2013 2012 Assets Cash and balances with treasury and other banks 206,813 177,099 146,428 128,870 87,573 114,388 109,396 Lending to financial institutions 33,942 10,868 25,711 24,095 21,872 28,835 21,953 Investments- gross 792,857 1,095,555 808,959 721,651 499,060 425,253 351,002 Advances - gross 776,272 670,056 559,093 497,032 479,998 436,749 409,090 Operating fixed assets 47,556 46,205 35,582 31,630 30,303 24,608 24,431 Other assets 98,977 79,617 67,812 41,124 40,067 27,317 26,800 Total assets - gross 1,956,417 2,079,400 1,643,585 1,444,402 1,158,874 1,057,150 942,673 Provisions against non-performing advances (60,336) (42,697) (40,525) (41,618) (45,734) (45,936) (44,727) Provisions against diminution in value of investment (6,482) (3,769) (2,428) (2,133) (1,726) (1,476) (1,412) Total assets - net of provision 1,889,599 2,032,934 1,600,632 1,400,651 1,111,414 1,009,739 896,535 Liabilities & Equity Deposits & other Accounts 1,366,060 1,272,788 1,167,124 1,051,235 895,083 827,848 698,430 Borrowing from financial institutions 268,124 512,650 201,550 163,132 53,065 40,574 68,720 Sub-ordinated loans 9,000

  • 665

9,319 Bills payable 27,249 29,848 24,520 13,392 9,554 16,591 7,601 Other liabilities 67,896 58,341 55,651 30,757 28,196 23,147 20,226 Total Liabilities 1,738,329 1,873,627 1,448,845 1,258,516 985,898 908,825 804,296 Net Assets / Liabilities 151,270 159,307 151,787 142,135 125,516 100,914 92,238 Share capital 12,242 12,242 12,242 12,242 12,242 12,242 12,242 Reserves 54,439 43,847 40,455 38,402 34,130 33,681 29,044 Un - appropriated profit / (loss) 68,002 70,912 64,246 55,223 48,217 42,635 37,416 Equity - Tier I 134,683 127,001 116,943 105,867 94,589 88,558 78,702 Surplus on revaluation of assets 16,587 32,306 34,844 36,268 30,927 12,356 13,537 Equity 151,270 159,307 151,787 142,135 125,516 100,914 92,238 Total liabilities & equity 1,889,599 2,032,934 1,600,632 1,400,651 1,111,414 1,009,739 896,535

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SLIDE 27

UBL Performance Overview – FY 2018

27

Profit & Loss

  • Rs. in mlns

2018 2017 2016 2015 2014 2013 2012

Markup / return / interest earned 113,198 107,206 98,219 94,353 82,735 72,846 73,507 Markup / return / interest expensed (56,964) (50,781) (41,177) (38,511) (37,769) (34,910) (34,948) Net Markup / Interest income 56,234 56,425 57,042 55,842 44,967 37,936 38,560 Fee, commission, brokerage and exchange income 17,396 14,496 14,020 14,474 14,418 12,205 10,025 Capital gain & dividend income 6,709 6,762 8,629 6,442 3,806 4,845 3,131 Other income 967 904 960 1,070 1,071 1,064 3,975 Non interest income 25,072 22,162 23,609 21,986 19,296 18,114 17,131 Gross income 81,306 78,587 80,651 77,828 64,263 56,050 55,691 Administrative expenses and other charges (43,222) (36,109) (32,809) (31,776) (29,597) (26,718) (24,306) Profit before provisions 38,084 42,478 47,842 46,052 34,666 29,332 31,385 Donations (203) (110) (87) (167) (112) (77) (35) Provisions (12,914) (2,450) (1,740) (3,710) (1,156) (1,448) (4,499) Profit before taxation 24,967 39,918 46,015 42,175 33,398 27,807 26,851 Taxation (9,741) (14,739) (18,285) (16,448) (11,469) (9,193) (8,960) Profit after taxation 15,226 25,179 27,730 25,727 21,930 18,614 17,891

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SLIDE 28

UBL Performance Overview – FY 2018

28

Key Financial Ratios & Share Information

2018 2017 2016 2015 2014 2013 2012 Key Financial Ratios

Return on equity (RoE) 11.6% 20.6% 24.9% 25.7% 23.9% 22.3% 23.8% Return on assets (RoA) 0.8% 1.4% 1.8% 2.0% 2.1% 2.0% 2.1% Profit before tax ratio 30.7% 50.8% 57.1% 54.2% 52.0% 49.6% 48.2% Return on capital employed (RoCE) 11.3% 20.6% 24.9% 25.7% 23.9% 21.0% 20.9% Advances to deposits ratio (ADR) - gross 53.2% 49.8% 45.6% 45.2% 51.3% 50.7% 56.2% Cost to revenue ratio 47.8% 45.0% 39.6% 39.7% 45.2% 46.5% 42.6% Growth in gross income 3.5%

  • 2.6%

3.6% 21.1% 14.7% 0.6% 6.8% Total assets to shareholders’ funds 12.5 12.8 10.5 9.9 8.9 10.0 9.7 Intermediation cost ratio 3.3% 3.0% 3.0% 3.3% 3.4% 3.5% 3.7% NPL ratio 8.8% 7.8% 8.0% 9.4% 11.2% 12.1% 14.0% Net infection ratio 1.1% 1.5% 0.8% 1.1% 1.9% 1.7% 3.5% Capital adequacy ratio (CAR) 17.7% 15.4% 15.1% 14.6% 13.9% 13.3% 15.0%

Share Information - Rs

Cash dividend per share 11.00 13.00 13.00 13.00 11.50 10.00 8.50 Dividend yield (based on cash dividend) 5.9% 5.4% 8.4% 7.4% 8.7% 12.0% 16.2% Dividend payout ratio (total payout) 88.4% 63.2% 57.4% 61.9% 64.2% 65.8% 58.2% Earning per share (EPS) 12.44 20.57 22.65 21.02 17.91 15.21 14.61 Price earnings ratio (PE) 9.86 9.14 10.55 7.37 9.86 8.72 5.72 Market value per share - at the end of the year 122.64 187.97 238.90 154.95 176.71 132.55 83.67 Market value per share - highest during the year 219.70 283.00 243.72 186.75 198.39 154.21 91.99

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SLIDE 29

UBL Performance Overview – FY 2018

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Quarterly Trend Analysis Bank Level - Standalone

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UBL Performance Overview – FY 2018

Profit before tax Rs in bln

30

5.9 6.4 7.1 8.4 7.8 8.0 8.3 9.3 10.9 11.2 10.2 9.9 11.3 13.5 10.8 10.4 11.2 11.8 8.4 8.8 4.1 6.5 5.9 8.5

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18

+4%

  • 54%

+61%

  • 10%

+44%

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UBL Performance Overview – FY 2018

Profit after tax Rs in bln

31

4.0 4.3 4.7 5.7 5.2 5.3 5.3 6.1 7.1 5.6 6.5 6.5 7.3 7.0 7.0 6.4 7.3 6.0 5.9 6.3 2.6 3.6 3.5 5.5

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18

  • 5%
  • 58%

+37% +8% +59%

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UBL Performance Overview – FY 2018

32

Deposits Rs in bln

703 752 773 828 847 858 866 895 945 992 994 1,051 1,070 1,142 1,147 1,1671,183 1,256 1,254 1,2731,301 1,3151,3351,366

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18

+1% +2% +2% +1% +2%

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UBL Performance Overview – FY 2018

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Net Advances Rs in bln

352 363 369 391 377 408 417 434 420 430 459 455 447 496 509 519 498 565 567 627 624 675 673 716

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18

  • 0%

+11% +8% +6%

  • 0%
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UBL Performance Overview – FY 2018

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Revenue Rs in bln

12.6 13.8 14.1 15.4 14.9 16.3 15.5 17.6 19.3 20.3 18.6 19.5 21.9 21.3 18.1 19.2 20.0 20.4 17.9 20.3 21.2 21.2 19.0 20.0

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18

  • 10%

+13% +4% +0% +5%

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UBL Performance Overview – FY 2018

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Net Interest Income Rs in bln

8.8 9.0 9.5 10.6 9.8 11.3 11.0 12.8 13.1 14.2 13.9 14.7 13.6 15.7 13.7 14.0 13.7 14.3 14.2 14.2 13.9 14.2 13.8 14.4

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18

+1%

  • 3%

+2%

  • 3%

+4%

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UBL Performance Overview – FY 2018

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Non Funded Income Rs in bln

3.9 4.8 4.6 4.9 5.1 5.0 4.5 4.8 6.2 6.2 4.84.8 8.4 5.6 4.5 5.2 6.3 6.1 3.8 6.0 7.3 7.0 5.1 5.7

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18

+60% +21%

  • 5%
  • 26%

+10%

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UBL Performance Overview – FY 2018

37

Provisions Rs in bln

0.5 0.8 0.3

  • 0.1

0.2 0.9

  • 0.1

0.2 0.8 1.3 0.7 0.9 2.0

  • 0.3
  • 0.3

0.3 0.1

  • 0.5

0.6 2.1 1.9 2.6 2.9 5.5

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18

+11% +260%

  • 8%

+37% +88%

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SLIDE 38

UBL Performance Overview – FY 2018

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Administrative Expenses Rs in bln

6.2 6.5 6.5 6.9 6.9 7.2 7.1 8.0 7.3 7.6 7.4 8.6 8.4 7.8 7.4 8.2 8.5 8.8 8.8 9.2 8.7 9.9 9.6 10.7

Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18

  • 2%

+5%

  • 6%

+14% +11%

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UBL Performance Overview – FY 2018

39

The information contained herein reflects our latest business statement as at December 31, 2018. Except the historical information contained herein, statements in this Release which contain words or phrases such as ‘will’, ‘would’, ‘indicating’ expected to’ etc., and similar expressions or variations of such expressions may constitute ‘forward- looking statements’. These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to our ability to successfully implement

  • ur strategy, future levels of non-performing loans, our growth and expansion in

business, the impact of any acquisitions, the adequacy of our allowance for credit losses, technological, implementation and changes, the actual growth in demand for banking products and services, investment income, cash flow projections, our exposure to market risks as well as other risks detailed in the reports filed by us with various regulatory authorities as per applicable laws and regulations. UBL undertakes no obligations to update forward-looking statements to reflect event or circumstances after the date thereof. Important Information

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UBL Performance Overview – FY 2018

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Thank You