DEBT INVESTOR PRESENTATION - February 2018
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DEBT INVESTOR PRESENTATION February 2018
Disclaimer
Please note that FAB pro forma consolidated financials at 31 December 2017 serve as the main basis of reference for our
Management Discussion & Analysis Report (MDA) and Investor Relations presentation.
Comparative figures have been reclassified where appropriate to conform to the presentation and accounting policies
adopted in the pro forma condensed consolidated interim financial statements.
FAB’s audited consolidated financial statements as at 31 December 2017 are prepared on the basis that FGB/NBAD merger was
declared effective on 1st April 2017 with FGB being the accounting acquirer as per IFRS 3. Therefore, these financials reflect
consolidation of NBAD since 1st April 2017 only, while prior period comparative financial information relates to FGB.
For further information, please refer to the Business Combination note of the reviewed consolidated interim financial statements.
The information contained herein has been prepared by First Abu Dhabi Bank P.J.S.C (“FAB”). FAB relies on information obtained from
sources believed to be reliable but does not guarantee its accuracy or completeness.
This presentation has been prepared for information purposes only and is not and does not form part of any offer for sale or solicitation
of any offer to subscribe for or purchase or sell any securities nor shall it or any part of it form the basis of or be relied on in connection
with any contract or commitment whatsoever.
Some of the information in this presentation may contain projections or other forward-looking statements regarding future events or the
future financial performance of FAB. These forward-looking statements include all matters that are not historical facts. The inclusion of
such forward-looking information shall not be regarded as a representation by FAB or any other person that the objectives or plans of
FAB will be achieved. FAB undertakes no obligation to publicly update or publicly revise any forward-looking statement, whether as a
result of new information, future events or otherwise.
Note: Rounding differences may appear throughout the presentation
2
Contents
01 Operating Environment
02 Introducing FAB
03 Integration Journey
Q4/FY’17 Financial Review
04 Based on Pro forma financial information as of 31 December 2017
05 Appendix
3
UAE Economic Overview
2nd largest economy in GCC USD 379 Bn
2017f Nominal GDP3
UAE 6th largest oil reserves ~95 Bn boe1
1.3% 3.4% +5.6%
On path to strong recovery 2017f 2018f Increase in 2018
Real GDP Growth3 Federal Budget4
UAE federation established in 1971
Comprising 7 Emirates Diversified and competitive 83% 16th
Estimated population3 (2016): 9.9 Mn economy non-oil sector contribution most competitive
to nominal GDP2 economy
(WEF 2016/2017)
Diversified Economy2 Nominal GDP3 (USD Bn) Economic Structure
2016e 2017f 2018f
Trade, and Performance3
Restaurants &
Manufacturing Hotels Saudi Arabia
15%
679 Real GDP Growth (% change) 3.0 1.3 3.4
10%
Finance
10%
UAE 379 Nominal GDP (USD Bn) 349 379 401
Qatar 166 Inflation (CPI, % change) 1.8 2.1 2.9
Mining and
quarrying Kuwait 118 General govt revenue (% GDP) 28.5 26.8 27.3
17%
Oman 72 General govt expenditure (% GDP) 32.6 30.4 29.5
Others5
31%
Construction and Bahrain 34 Fiscal balance (% GDP) (4.1) (3.7) (2.2)
Real Estate
17%
Gross Debt (% GDP) 20.7 20.7 20.8
1 - OPEC; boe (barrel of oil equivalent) (December 2016) 2 - Federal Competitiveness and Statistics Authority, 2016 Nominal GDP
3 - IMF World Economic Outlook, October 2017 4 - WAM
5 - Others include Agriculture, Utilities, Transportation, Communication, Government and Other activities
4
Other Macro Indicators
2017f Debt/GDP1 (%) UAE PMI in Expansionary Territory2
60
90.6 56.8
54.4 55
44.5
20.7 27.1
17.0
50
Saudi UAE Kuwait Oman Qatar Bahrain
Arabia
45
Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17 Jan-18
AED 155 Bn Net Deposit Surplus as of Dec’173 Libor-Eibor spread has tightened
AED Bn
200 110% 2.0 2.0
155 1.8 1.8
150 105%
1.6 1.6
100% 1.4 1.4
100
95% 1.2 1.2
50 90%
1.0 1.0
90%
0 0.8 FED rate hikes 0.8
85%
0.6 0.6
(50) 80% 0.4 0.4
(100) 75%
0.2 0.2
Dec'04
Dec'05
Dec'06
Dec'07
Dec'08
Dec'09
Dec'10
Dec'11
Dec'12
Dec'13
Dec'14
Dec'15
Dec'16
Dec'17
0.0 0.0
Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17 Jan-18
Net Deposit Surplus/ Deficit L/D ratio, net LIBOR 3M EIBOR 3M E-L Spread (RHS)
1 - Source: IMF World Economic Outlook – October 2017
2 - Source: Markit Economics, UAE Purchasing Manager Index is a composite indicator designed to provide an overall view of activity in the UAE’s non-oil private sector economy.
The indicator is derived from individual diffusion indices which measure changes in output, new orders, employment, suppliers’ delivery and stocks of goods purchased
3 - UAE Banking Indicators have been adjusted retrospectively in order to reflect accounting adjustments related to the National Housing Loan Program
5
Abu Dhabi – The Capital
Umm al Quwain Ras al Khaimah
Major contributor to UAE GDP1 USD 198 Bn
Ajman 2016 Nominal GDP
Sharjah
Dubai Ajman Fujairah
4th Highest GDP per capita USD 68,3371
in the world3 (2016)
ABU DHABI
Highest ratings in MENA Aa2 / AA / AA
Moody’s / S&P / Fitch
87% of UAE land area1
Estimated population1 : 2.9 Mn On clear path to recovery and 72% 0.3% 3.2%
2017f 2018f
economic diversification non-oil sector contribution
Real GDP growth2
to nominal GDP1
On track to meet Plan Abu Dhabi 2030 targets Economic Structure
2014 2015 2016
Nominal GDP breakdown by sector Target real GDP 5
and Performance1
Trade,
Restaurants & Real GDP growth (% change) 4.4 4.9 2.8
Manufacturing Hotels
Oil GDP Non-Oil GDP
7% 7%
Finance Nominal GDP (USD Bn) 261 212 198
10%
Mining and
quarrying Inflation Rate (CPI, % change) 3.2 4.3 2.0
28%
Revenue/ GDP 39.6 34.1 36.2
64%
Others4 51%
41% Expenditures/ GDP 39.4 39.4 39.8
29%
Construction
and Real Estate
19%
Balance/ GDP 0.2 (5.3) (3.6)
2005 2016 2030 Target
1 - Abu Dhabi 2017 Bond Prospectus, Statistical Year Book of Abu Dhabi, (SCAD) July 2017, preliminary estimates
2 - IMF quoted by Reuters, November 2017 3 - IMF, 2016 (assuming Abu Dhabi is a separate country)
4 - Others include Agriculture, Utilities, Transportation, Communication, Government and Other activities
5 - Abu Dhabi Economic Vision 2030, SCAD 6
Sound and highly capitalised banking sector
Key Highlights UAE Banking Sector Key Indicators2
• UAE banking sector comprises 48 banks (22 local, 26 foreign); top 4 Figures in AED Bn Dec’17 Dec’16 YoY
local banks hold around 62% of system loans and deposits
Total Assets, net2 2,586 2,485 4.1%
• UAE CB introduced in May 2015 a glide path on Liquidity Coverage
Loans and Advances, net2 1,472 1,446 1.8%
Ratio (LCR) in the context of gradual migration to Basel III regulatory
Customer Deposits 1,627 1,563 4.1%
framework. The minimum for the current year is 90%
LDR2 90% 93% -300bps
• UAE CB Basel III capital guidelines effective from 1st Feb 2017 with min.
CET 1 set at 7.0%; full implementation by 2019 Lending to Stable Resources Ratio3 84.6% 86.2% -160bps
CAR4 18.9% 18.9% -
Tier 1 capital4 17.4% 17.3% +10bps
Movements in Customer Deposits and
FAB has a Dominant Market Position1 Gross Credit by Sector2 (AED Bn)
Customer Deposits
LOANS & ADVANCES (NET) CUSTOMER DEPOSITS Dec’15 +29 +57 +0.1 +27 Dec’16 +25 +23 +20 +3 Dec’17
-7
-22
1,472 1,563 1,627
+6.2% +4.1%
+6 +55 +17 +3 +30 +7
+16
Gross Credit
-6 -13 -0.4
1,466 +6.0% 1,554 +1.7% 1,581
27% 28%
NBFI
NBFI
Government
Non-Residents
Government
Non-Residents
Private Sector
Private Sector
Dec'16
Public Sector/GREs
Dec'17
Dec'15
Public Sector/GREs
1 - Based on Dec’17 Financials of 10 largest UAE listed banks by Total Assets
2 - Source: UAE Central Bank, UAE Banking Indicators have been adjusted retrospectively
in order to reflect accounting adjustments related to the National Housing Loan Program
3 - Total advances (net lending + net financial guarantees & stand-by LC+ Interbank placements
more than 3 months)/ sum of (net free capital funds + total other stable resources)
4 - Basel 2 7
Contents
01 Operating Environment
02 Introducing FAB
03 Integration Journey
Q4/FY’17 Financial Review
04 Based on Pro forma financial information as of 31 December 2017
05 Appendix
8
Introducing FAB
Result of the historic merger between two iconic Abu Dhabi-based franchises
Largest bank in UAE and 2nd largest in MENA by total assets and market
capitalisation
Highest rated bank in MENA with Aa3/AA-/AA-1 (stable outlook)
Strong liquidity profile and robust capital ratios
Superior asset quality, cost efficiency and profitability metrics
Excellent progress made so far in integration journey; Set to realise
substantial synergy potential by 2020
1 - Moody’s/S&P/Fitch
9
FAB at a glance
19 103 603
Overview Countries presence Branches in UAE ATMs/CDMs
(ex UAE)
• FAB is the result of the historic merger between two
iconic Abu Dhabi based franchises (FGB and NBAD)
• Largest UAE bank and 2nd largest in MENA by total
assets (AED 669 Bn) and market capitalisation EUROPE & AMERICAS
(E&A)
(AED 112 Bn)
UK
• Offers extensive range of products and services via France ASIA PACIFIC
(APAC)
market-leading Corporate and Investment Banking Switzerland
(CIB), Personal Banking (PB) franchises and USA
MIDDLE EAST & AFRICA India
(MEA)
subsidiaries Malaysia
Brazil UAE Singapore
• Domestic network: 103 branches and 603 ATMs/CDMs Bahrain
China/ Hong Kong
across all 7 emirates Oman
South Korea
• Global presence: 19 countries (excluding UAE) Qatar
Kuwait
Jordan
Lebanon
Libya
Egypt
Sudan
Credit ratings
RAM R&I
Moody’s S&P Fitch
(Malaysia) Japan
• Affirmation of credit ratings by Moody’s, S&P, and Fitch
post merger completion on 3rd April 2017 is a powerful LT Aa3 AA- AA- AAA A+
testament to the strong rationale for the merger as it
enhances the combined bank’s business position and
credit profile ST P-1 A-1+ F1+ P1
• FAB has the strongest combined credit ratings of any
Outlook Stable Stable Stable Stable Stable
bank in MENA at Aa3/AA-/ AA-1
All figures as on 31 December 2017
1 - Moody’s/S&P/Fitch 10FAB Share Profile
Overview Strong shareholding structure3
Mubadala
• Listed on Abu Dhabi Securities Exchange (ADX) ADIC 3.7%
33.5%
• Symbol: FAB
• Number of shares issued: 10,898 million1
• Market cap2: AED 112 Bn (USD 30.4 Bn)
• Foreign Ownership Limit: 25% Foreign (ex-GCC)
9.3% Other UAE
companies and
individuals
GCC (ex-UAE)
52.1%
1.4%
Index Weightings2
Abu Dhabi Securities Market Index ADSMI 35.2%
Bloomberg GCC 200 financial Index BGCCFIN200 4.0%
Bloomberg EMEA Banks Index BEUBANK 1.9%
1 - Includes 42 Mn Treasury shares
2 - As on 31 December 2017
3 - Ownership structure as of 31 December 2017, based on shares outstanding (net of treasury shares)
11Leading UAE and regional bank
Banking sector assets1 National FY’17 Net Profit1 Total Assets1 Equity1 Market Cap3 Credit Ratings3
(USD Bn) champion2 (USD Bn) (USD Bn) (USD Bn) (USD Bn) (Moody’s/S&P/Fitch)
734 3.0 182 27.8 30.4 Aa3 / AA- / AA-
UAE
615 2.6 118 17.1 29.3 A1 / BBB+ / A-
KSA
375 3.6 221 21.5 31.8 Aa3 / A / A+
Qatar
212 1.1 86 11.8 14.3 Aa3 / A+ / AA-
Kuwait
0.5 34 4.3
189 5.8 NA / BBB / BBB+
(9M’17) (Sep’17) (Sep’17)
Bahrain
82 0.5 29 4.7 2.8 Baa2 / BB / BBB-
Oman
1 - Company and Central Bank information as of latest reported for 31 December 2017, except for Banking Sector Assets for Bahrain and Oman (30 Nov 2017)
2 - Defined as the largest bank in the country by total assets
3 - Based on 31 December 2017; Source Bloomberg
12Prominent Board and robust governance
H.H. Sheikh Tahnoon Bin Zayed Al Nahyan – Chairman
National Security Advisor
Chairman of Royal Group
Board of Directors
Photo Photo Photo Photo Photo Photo Photo
H.E. Nasser H.E. Khaldoon H.E. Mohammed H.E. Mohamed H.E. Jassim H.E. Khalifa H.E. Sheikh H.E. Sheikh
Ahmed Khalifa Al Thani Al- Saif Al Suwaidi Mohammed Al Sultan Al Mohammed Bin Ahmed
Alsowaidi Mubarak Romaithi Siddiqi Suwaidi Saif Bin Mohammed
Mohammed Al Sultan Al
Nahyan Dhaheri
Vice Chairman Board Member Board Member Board Member Board Member Board Member Board Member Board Member
of the Board
CEO and MD of Chairman of the Director General CEO and MD of Executive Chairman of Abu Chairman of Bin
Chairman of Mubadala Federation of of Abu Dhabi Abu Dhabi Director at the Dhabi National Suroor
ETECH Investment UAE Chambers Fund for Financial Group Abu Dhabi Insurance Engineering
Company Company
of Commerce Development (ADFG) Investment (ADNIC)
Chairman of the and Industry Council (ADIC)
Executive Affairs Board Member Chairman of Chairman of Vice Chairman
Authority of the Board Member of of DP world and Shuaa and Board Member Risk of Abu Dhabi
Government of Al Etihad Credit Agthia Eshraq of UNB, ADIC Management National Hotels
Abu Dhabi Bureau Properties and Barakah Committee of Company
One ADNIC
4 Board Committees
Board Management Remuneration & Nomination
Risk Committee Audit Committee
Committee Committee
13Talented and Experienced Senior Leadership
Andre Sayegh
Deputy Group CEO &
Group Head of
Corporate & Investment
Abdulhamid M. Saeed Banking
Group CEO
Zulfiqar Hana Al Karim James PK Shirish Arif Nurendra Fadhel Al Ali
Sulaiman Rostamani Karoui Burdett Medappa Bhide Shaikh Perera
Group
Group Chief Group Group Group Group Group Group Acting Chief
Operating Head of Head of Chief Chief Chief Chief Risk Group Customer
Officer, Group Personal Subsidiaries, Financial People Credit Officer Chief Experience &
Head of Banking Strategy & Officer Officer Officer Audit Digital
International Transformation Officer Officer
Banking and
Group Chief
Integration
Officer
14Strategy built on core strengths
Our Vision:
Creating value for our customers, employees, shareholders and communities
to grow stronger through differentiation, agility and innovation.
DOMINANT PERSONAL BANK IN UAE
• Bank of choice across key segments in Abu Dhabi, and enhanced market share in Dubai
& Northern Emirates
• Multichannel and ‘smart’ distribution model leveraging on digital solutions
• Leader in everyday banking anchored in payment solutions & cards
REGIONAL WEALTH ADVISOR OF CHOICE
• Access new high growth HNWI segments
• Use global network to expand product and service range
• Deepen existing relationships with increased cross-sell COMPLEMENTARY OFFERING
THROUGH SUBSIDIARIES
TRUSTED PARTNER TO CIB CUSTOMERS
• Leverage scale and cross-sell to deepen client relationships and increase share of wallet
in UAE and abroad
• Preferred banking partner for government and GREs
• One-stop shop banking partner for large corporates and medium-sized businesses
INTERNATIONAL BUSINESS BUILT AROUND UAE KNOWLEDGE AND RELATIONSHIPS
• Wholesale-driven international strategy
• Reference bank for UAE multinational businesses
• Selective international presence and sharper focus on high potential growth markets
(APAC)
15Business Segments
CORPORATE &
Segment PERSONAL BANKING SUBSIDIARIES HEAD OFFICE
INVESTMENT BANKING
Covers corporate and Targets retail, affluent, private Complementary offerings Centralised enablement
institutional clients through banking and SME customer provided across real estate and functions: HR, operations,
dedicated client segments segments property management, finance, strategy, investor
brokerage, conventional and relations, risk management,
Islamic consumer finance credit management, corporate
Offers Credit facilities, Global Product offerings range from
communications, legal &
Transaction Services, day-to-day banking products
compliance, internal audit,
Corporate Finance, Islamic such as current accounts,
procurement, treasury
Finance and Global Markets deposits, credit cards and loans
operations, integration
products to both UAE and to more sophisticated
management office and
international clients investment solutions and
administrative support
Coverage and business banking products and
offering services
Wide range of diverse
distribution and sales channels,
including mobile and internet
banking, branches and direct
sales agents
Manages National Housing
Loan program for Abu Dhabi
government
% FY’17 48% 35% 7% 10%
Group
revenue
16Key financials at a glance
Balance sheet & Income Statement - Based on Pro forma Financial Information
TOTAL ASSETS (AED Bn) LOANS & ADVANCES (AED Bn) CUSTOMER DEPOSITS (AED Bn)
660.4 669.0 334.4 345.2 328.3 330.5 379.2 393.9 377.3 378.9 395.8
649.1 624.6 644.1 321.3
Dec'16 Mar'17 Jun'17 Sep'17 Dec'17 Dec'16 Mar'17 Jun'17 Sep'17 Dec'17 Dec'16 Mar'17 Jun'17 Sep'17 Dec'17
TANGIBLE EQUITY (AED Bn) OPERATING INCOME (AED Mn) NET PROFIT (AED Mn)
2,854 2,926 2,822
71.9 70.7 73.3 71.1 5,102 5,188 5,049 2,562 2,605
68.0 4,686 4,611
Dec'16 Mar'17 Jun'17 Sep'17 Dec'17 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17
17Key financials at a glance
Ratios - Based on Pro forma Financial Information
COST TO INCOME RATIO-YTD (%)
NIM – YTD (%) NPL RATIO (%) PROVISION COVERAGE (%) (EX-INTEGRATION COSTS)
2.55 2.46 2.48 2.51 2.49 3.2 3.0 3.1
124.6 121.8 28.3 27.2 27.5 27.6 27.7
2.7 2.6 111.6 109.0 120.1
FY'16 Q1'17 H1'17 9M'17 FY'17 Dec'16 Mar'17 Jun'17 Sep'17 Dec'17 Dec'16 Mar'17 Jun'17 Sep'17 Dec'17 FY'16 Q1'17 H1'17 9M'17 FY'17
NON-INT INC / REVENUES (%) CET1 & CAR (%) ROTE (%) RORWA (%)
CET1 CAR
37.2 18.2 17.2 18.2 18.4 17.8
33.5 33.4 15.7 16.1
30.8 29.6 14.8 14.3 14.8
2.3 2.4 2.3 2.2 2.3
14.8 13.9 14.7 14.9 14.5
Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Dec'16 Mar'17 Jun'17 Sep'17 Dec'17 FY'16 Q1'17 H1'17 9M'17 FY'17 FY'16 Q1'17 H1'17 9M'17 FY'17
18Contents
01 Operating Environment
02 Introducing FAB
03 Integration Journey
Q4/FY’17 Financial Review
04 Based on Pro forma financial information as of 31 December 2017
05 Appendix
19Integration exceeds expectations
All planned milestones successfully delivered in 2017
2017 2018 Q1 2019
Finalisation of organisational structure and operating model o IT system integration on track; to be completed around the
end of 2018 (adequate planning, resourcing and tight risk
Harmonisation of Group policies and risk framework
management)
CIB product and pricing harmonisation completed
o PBG product and pricing harmonisation
Subsidiaries: Integration of real estate and property
o Strategic review/ implementation of international value
management businesses completed, integration of islamic
proposition
finance subsidiaries on track; brokerage business
rebranded (FAB Securities) o Ongoing network optimisation (UAE + international)
Network optimisation o Further process refinements/simplification and automation
UAE network and channel external re-brand completed; in
progress across international locations
“Purchase Price Allocation” exercise is substantially
complete
Culture and change management
20Integration exceeds expectations
Merger benefits evident since 2016
G&A expenses BAU1
In AED Mn
30.2%
29.3%
27.9%
28.6% 28.3% CI ratio1
27.0%
6,030 -5%
5,745
5,552 -8%
5,225 5,274 Cost reduction
= AED 756Mn
FGB
1,947 FGB
4,448 FGB 1,848
FGB 1,856
1,766
FGB
1,446 FAB
NBAD NBAD
NBAD 4,083
NBAD NBAD 3,897
3,696
3,002 3,459
2012 2013 2014 2015 2016 2017
1 Excluding integration/ merger transaction-related costs and amortisation of intangibles (merger-related)
21Integration exceeds expectations
Synergy financials
Increasing run-rate cost synergy target In AED
• Synergies significantly ahead of target in 2017 2017 2018 2019 2020
Initial phasing 25% 65% 85% 100%
• IT system integration around end of 2018 to
Revised phasing 33% 55% 85% 100%
unlock substantial merger benefits in addition to
other initiatives (incl. process simplification, ~1.5Bn
automation, and network optimisation - UAE and
~1Bn
international)
~500Mn
~250Mn
• Raising 2020 full annual run-rate by 50% to
AED ~1.5Bn
2017 guidance 2017 actual 2020 initial target 2020 revised
target
Integration costs on track In AED
2017 2018 2019
• Higher integration costs vs 2017 guidance reflect
acceleration of integration plan; estimated Initial phasing 35% 35% 30%
phasing revised accordingly
Revised phasing 42% 30% 28%
• On track with one-time integration cost target of 463Mn
AED 1.1Bn, to be fully absorbed by 2019 385Mn
330Mn 307Mn
2017 guidance 2017 actual 2018 est 2019 est
1.1Bn
22Laying the right foundation for long term
sustainable growth
How we will measure our success by 2020
1 Growth-oriented culture Increased market share and share of wallet
Successful execution of
2 integration plan Full realisation of run rate synergies
One Bank, One brand, Infrastructure integration
3 One team People integration
Sustainable cost
4 leadership
~25% Cost-to-Income ratio
Strong internal capital 16-17% RoTE1
5 generation capacity >13.5% min. CET1
1 - RoTE: Attributable profit (to equity shareholders net of interest on Tier1 capital notes) on average shareholders’ tangible equity (excl minority interests, excl goodwill
and amortisation charge on it thereof)
23Contents
01 Introducing FAB
02 Integration Journey
03 Operating Environment
Q4/FY’17 Financial Review
04 Based on Pro forma financial information as of 31 December 2017
05 Appendix
24Q4/FY’17 Key Performance Highlights
• Resilient performance in transitional year
• Reported Net Profit at AED 10.9Bn, down 4% yoy; EPS at AED 0.96
• Adjusted Group Net Profit at AED 11.5Bn, broadly in line with 2016
• Delivering top returns for our shareholders in year 1
• Proposing cash dividends of AED 7.6Bn
• DPS of AED 0.70, 11% higher than 2016 pro forma
• Integration journey exceeds expectations
• Synergies significantly ahead of target in 2017
• Raising cost synergy 2020 annual run-rate target by 50%; Integration costs firmly on track
• Robust balance sheet and healthy fundamentals
• Capital position comfortably in excess of regulatory requirements
• Strong liquidity position, healthy asset quality and solid profitability
• Looking ahead with confidence
• Macro and business tailwinds to support 2018 performance
• FAB positioned well to achieve successful integration and capture future growth opportunities
25Resilient performance in transitional year
Financial Highlights
FY’17 vs. FY’16
In AED Mn FY’17 FY’16 YoY % • Revenue 4% lower due to softer market conditions and
portfolio optimisation
Revenues 19,533 20,302 -4
Operating expenses (5,875) (5,922) -1 • BAU1 Operating costs down 8% when excluding one-off
BAU1 costs (5,274) (5,745) -8 integration/merger transaction-related costs and
Integ/ merger transaction-related costs (463) (178)
amortisation of intangibles identified as a result of PPA
exercise
Amort. Intangibles (merger-related) (138) -
Impairment charges (2,384) (2,664) -10 • Impairment charges 10% lower on the back of lower
Reported Net profit 10,915 11,322 -4 collective provisions and higher write-backs
Adjusted Net profit 11,517 11,500 - • Reported Net Profit down 4%, yet broadly in line with
EPS (AED) 0.96 1.0 -4 2016 on Adjusted basis
DPS (AED) 0.70 0.63 +11 • DPS up 11%
Key ratios
% FY’17 FY’16 YoY (bps) • Industry-leading C/I ratio
C/I ratio (ex-integ costs) 27.7 28.3 -59 • Healthy asset quality and improved coverage qoq due to
CoR (bps) 69 76 -7 PPA
NPL ratio 3.1 2.7 41 • Strong liquidity position remains competitive strength
Provision coverage 120.1 124.6 -451
• Solid returns, above full year guidance
L/D ratio 83.5 88.2 -472
• Capital position as D-SIB comfortably in excess of
RoTE 14.8 15.7 -83
regulatory requirements under Basel III
CET1 ratio2 14.5 14.8 -32
1 BAU – Business as usual
2 CET1 ratio as per UAE CB’s Basel III framework (without considering the transitional arrangements for 2017); 2016 ratio as per UAE CB’s Basel II framework 26Resilient performance in transitional year
We have met or exceeded most elements of financial guidance
FY’17 GUIDANCE FY’17 ACTUAL
Strong business momentum in second
LOAN GROWTH Low single digit negative -1% half, offset by asset optimisation and PPA
adjustments
Revenues impacted by margin
CORE REVENUE1 Flat -4% compression, subdued loan market and
lower trade activity
C/I RATIO Disciplined cost control and substantial
~28% 27.7%
(EX-INTEGRATION COSTS) synergy realisation, above expectations
Cautious risk management and healthy
COST OF RISK 70-75 bps 69bps
asset quality
14.8%
ROTE2 ~ 14%
(15.5% ex-integ.costs)
Solid returns in transitional year
1 - Excluding property-related one-offs and AFS investment gains
2 - Return on Average Tangible Equity, annualised; based on attributable profit to equity shareholders' excl Tier 1 notes coupon (AED 465Mn) and amortisation of intangibles
27PPA accounting
Substantially complete as of 31 Dec 2017
• As per IFRS 3 and Business Combination guidelines, the Bank is
required to complete a “Purchase Price Allocation” exercise in order
Concept
to determine the goodwill arising from the merger Post-PPA Accounting treatment
of PPA
• All acquired assets and assumed liabilities of NBAD should be
recorded at fair value • To be amortised over 12 yrs
• Year 1 impact of AED 138Mn
• Fair value adjustments impact net asset value and goodwill
recorded in Q4’17 (nine-
calculation
Impact month impact)
• Intangible assets identified as a result of PPA to be amortised Intangible assets
through P&L = AED 2.6Bn • Estimated impact on P&L for
2018 ~AED 185Mn
NBAD Net Asset Value as of March 31 2017
AED Bn Pre PPA PPA impact Post PPA
Loans and advances 210.7 (2.9) 207.8
Other Assets 225.3 (1.9) 223.4
Total assets 436.0 (4.8) 431.2
Total liabilities 397.2 0.3 397.5
• No amortisation
Goodwill • To be annually tested for
NBAD net asset value (pre-intangibles) 38.8 (5.1) 33.7 impairment
Intangibles identified - 2.6 2.6 = AED 17.3Bn
NBAD net asset value 36.3
Goodwill calculation (AED Bn)
Purchase Price Consideration (a) 53.6
NBAD Net Asset Value (b) 36.3
Goodwill (a)-(b) 17.3
Intangibles 2.6
Goodwill & Intangibles 19.9
Note: As of 31 Dec 2017, PPA exercise as per IFRS3 is substantially complete and no significant changes to NBADs net asset values are expected by 31 March 2018 28Robust capital position
Even after PPA / FY’17 proposed dividends
CET11 ratio progression
• CET1 comfortably in excess of minimum
requirement of 9% for 2017 even after
PPA impact and FY’17 proposed
2.27% 0.13% dividends
14.8% 0.99% 0.05%
1.42% 14.5% 1.57%
12.9% • Limited RWA impact: Credit RWA
optimisation offset by increased Market
Min 9% Min 9% RWA linked to higher client-related
derivative volumes
• Strong internal capital generation capacity
combined with continued RWA discipline
CET1 FY'16 Capital RWA impact PPA impact Other CET1 FY'17 CET1 to support future capital build-up; CET1
Dec'16 Dividends generation movements Dec'17 Proposed Dec'17 >13% by end of 2018
Dividends (Post-
dividends) • IFRS9 impact on CET1 estimated at
57-68bps
Basel III regulatory capital glide path2
2017 2018 2019
Min. CET 1 7.0% 7.0% 7.0%
Capital Conservation Buffer 1.25% 1.875% 2.50%
D-SIB Buffer 0.75% 1.125% 1.50%
Total Min. CET 1 9.00% 10.0% 11.0%
Additional Tier1 (AT1) 1.50% 1.50% 1.50%
Tier2 2.00% 2.00% 2.00%
1CET1 ratio as per UAE CB’s Basel III framework (without considering the transitional arrangements for 2017); 2016 ratio as per UAE CB’s Basel II framework
2AT1 (additional Tier 1) + Tier 2 capital requirement – Min 3.5%; any shortfall in same to be met by CET1; Countercyclical buffer requirement (0 – 2.5%) as advised by UAECB, is nil in 2017
29Robust capital position
3
Key Highlights Strong capital ratios (Basel III)
• Robust capital position with Basel III CET13 ratio at 14.5%,
comfortably in excess of regulatory requirements CET1 CAR CAR
• Tier 1 capital ratio at 16.7% and total CAR at 17.8% (vs 17.0% and 18.2% 17.8%
18.2% in Dec’16) 1.2% 1.1%
• Credit RWA optimisation offset by increased Market RWA linked to 2.2% 2.2%
14.8% 14.7% 14.9% 14.5%
higher client-related derivative volumes 13.9%
• FAB officially designated as Domestic Systemically Important Bank
(D-SIB); required to hold additional capital buffer of 1.5% by 2019 14.8% 14.5%
• Solid returns with Annualised RoTE at 14.8%, in line with full year
guidance; RoTE ex-integration costs at 15.5% for 2017
Dec'16 Mar'17 Jun'17 Sep'17 Dec'17 Dec'16 Dec'17
• 2018 RoTE guidance ~15%
CET1 AT1 Tier II
RWAs & Return on RWAs1 Annualised RoTE2 (YTD)
RWAs RoRWA ROAA
2.3% 2.4% 2.3% 2.2% 2.3%
1.8% 1.8% 1.7% 16.1%
1.6% 1.6%
15.7%
14.8% 14.8%
481.2 484.3 472.0 483.1 485.3
14.3%
Dec'16 Mar'17 Jun'17 Sep'17 Dec'17 FY'16 Q1'17 H1'17 9M'17 FY'17
1 - Year-to-date annualised
2 - Return on Average Tangible Equity, annualised; based on attributable profit to equity shareholders' excl Tier 1 notes coupon and amortisation of intangibles
3 – As per UAE CB’s Basel III framework (without considering the transitional arrangements for 2017); ratios prior to 2017 as per UAE CB’s Basel II framework 30Strong corporate loan origination in Q4; deposits
higher on Govt inflows
Key Highlights Loans and Advances* (AED Bn)
Loans and advances*
345.2
• Loan book increased 1% qoq as strong loan origination in Q4’17 334.4
was partially offset by continued balance sheet optimisation and fair 328.3 330.5
321.3
value adjustments linked to PPA
• Loans were down 1% yoy as new origination was offset by balance
sheet optimisation and corporate repayments in a overall subdued
Dec'16 Mar'17 Jun'17 Sep'17 Dec'17
loan market
Customer Deposits* (AED Bn)
Customer Deposits and other accounts*
• Customer deposits up 4% qoq and yoy, on higher government 393.9 395.8
deposit inflows
379.2 377.3 378.9
• CASA grew 7% yoy highlighting FAB’s strong deposit franchise and
leading cash management solution
• Liquidity position remains highly comfortable with loan-to-deposit Dec'16 Mar'17 Jun'17 Sep'17 Dec'17
ratio of 83.5%
• Dec-end 2017 LCR of 112% stands above the Basel III glide path Loan-to-deposit ratio* (%)
88.2 87.6
86.6
85.2
83.5
Dec'16 Mar'17 Jun'17 Sep'17 Dec'17
*Restated net of National Housing Program loans and deposits
31Strong business momentum in Q4 drives revenues
higher
Key Highlights Operating Income (AED Mn)
• Q4’17 revenues up 10% qoq led by higher fees & commissions FY'17 FY'16 YoY % Q4'17 Q3'17 QoQ %
(F&C) on strong pipeline execution, and property gains
• FY’17 revenues managed at AED 19.5Bn (-4% yoy) reflecting Net interest Income 1 13,106 13,550 -3 3,363 3,244 4
softer operating conditions, portfolio optimisation initiatives as well
as lower property compared to 2016
Fees & commissions, net 3,362 3,886 -13 932 788 18
• FY’17 NII down 3% yoy due to margin compression on asset
optimisation and lower IIS, while higher volumes drove 4%
FX and investment income, net1 2,586 2,023 28 464 491 -5
sequential increase in Q4’17
• F&C up 18% qoq on higher loan-related fees in CIB and higher
Other non-interest income 2 479 844 -43 289 89 226
credit card and insurance-related fees in PB. F&C 13% lower yoy
reflecting lower market loan and trade activity compared to 2016
Total Operating Income 19,533 20,302 -4 5,049 4,611 10
• FX and investment income up 28% yoy on opportunistic AFS
1 Negative interest income booked on some placements has been reclassified to net FX income
investment gains, mostly in Q1’17
2 Includes gains on sale of investment properties
Operating Income (AED Mn) Non-interest Income (AED Mn)
Net interest income Non-interest income
Other income -5%
-1% -4% Net FX & Investment income
+10% Net fees and commission income 6,753 6,427
5,102 5,188 5,049 20,302 19,533 15% 7%
4,686 4,611 1,933
33% 1,710 1,686 30% 40%
34% 37% 33% 33%
31% 30% 5% 3% 1,442 1,367 17%
3% 6%
38% 57% 28%
63% 67% 67% 37% 36%
66% 69% 70% 67%
58% 52%
57% 40% 60% 58% 55%
Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 FY'16 FY'17 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 FY'16 FY'17
32NIM trend reflects margin compression and impact
from placement of excess liquidity
Key Highlights Net Interest Margin (%)
• Group NIM: -13bps qoq and -6bps yoy reflecting margin
compression and the dilutive impact of deployment of short-term Group NIM (Qtr) Group NIM (YTD)
excess liquidity
• Performing loan yields: +9bps yoy on the back of corporate loan 2.57
2.55
repricing following benchmark rate hike; -15bps qoq primarily due
2.51
to the increase in low-yielding loan volumes and tighter risk appetite
in PB 2.46 2.49
2.51 2.51
• Cost of customer deposits: marginally up qoq and yoy, indicating 2.48 2.44
2.46
realisation of funding cost synergies despite 3 rate hikes
Q4'16 Q1'17 Q2'17 Q3'17 Q4'17
Performing Loan Yields (%) Cost of Customer Deposits (%)
Performing Loans Yield (Qtr) Cost of Customer Deposits (Qtr)
Performing Loans Yield (YTD) Cost of Customer Deposits (YTD)
4.57
0.81
4.44 4.44 0.78
4.35 4.35 0.73 0.74 0.74
4.45
4.40 4.42 0.76 0.77
4.35 0.74 0.74
0.71
4.31
Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17
Note: All percentage figures are annualised
33Strong synergy realisation drives better operating
efficiency
Key Highlights Cost-Income Ratio (%)
• Operating expenses BAU reduced 8% yoy, reflecting disciplined C/I ratio (ex-integration)
cost management and realisation of substantial synergies at an
increased pace C/I ratio (ex-integration and merger-related amortisation of intangibles)
• Headline operating expenses were lower 1% yoy and higher
20% qoq on higher Integration costs reflecting the increased
pace of synergy realisation and merger-related amortisation of 27.5 27.6 27.7
intangibles 28.3 27.2
• C/I ratio (ex-integration costs1) stands at industry-leading level of
27.7%, improving from 28.3% in FY’16; ex-amortisation of 27.0
intangibles (merger-related) C/I ratio stands at 27.0%
FY'16 Q1'17 H1'17 9M'17 FY'17
Operating expenses trend (AED Mn)
Amortisation of intangibles (merger-related)
Integration / merger transaction-related costs
Operating expenses (ex-integration) 5,922 -1% 5,875
1,553 1,616 138
1,516 178
1,399 1,344 463
118 104 138
91 70 198
BAU
5,745 -8% 5,274
1,434 1,412 1,308 1,274 1,280
Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 FY'16 FY'17
1 Excluding integration/ merger transaction-related costs
34Asset & Loan Mix
Asset Mix Gross loans by counterparty (AED Bn)
Others Cash & CB
9% Balances
347.7 345.1
21%
Banking Sector
Investments
16% 7% 6%
DFB and Personal/Retail Sector
Reverse 22% 21%
AED 669.0 Bn Repos Corporate/Private
Dec’17 5% Sector
53% 56% Public Sector
Loans and 17% 16% Government Sector
Advances 1% 1%
49%
Dec'16 Dec'17
Gross loans by economic sector Net loans by geography¹ Gross loans by product
Manufacturing
Energy 6% Construction Europe MENA America
2% 2% Overdrafts 4%
Agriculture 7% 3% 9%
0.1% Asia Vehicle financing
5% loans & others 0.4%
Personal - Real Estate
Loans & Credit 26% GCC Credit Cards 2%
Cards 2%
AED 345.1 Bn AED 330.5 Bn Personal Loans AED 345.1 Bn
21%
9% Dec’17 Term Loans
Dec’17 Dec’17
63%
Mortgage Loans
Government 1% Trading 5%
7%
Services 7% Transport and UAE Real Estate
Other financial Banks communication 80% 10% Trade related loans
institutions 8% 6% 8%
7%
1 - Based on booking centre
35CoR continues to benefit from RWA optimisation
Key Highlights Impairment Charges, net (AED Mn) & CoR
• Impairment charges (net) down 10% yoy driven by lower Impairment Charges, net Cost of Risk(bps)*
collective provision charges resulting from balance sheet
optimisation and higher write backs 76
• NPLs up 14% yoy primarily due to retail-led NPL formation 73 69
72
66 67 66
• Portfolio is adequately provisioned with coverage at 120%;
Collective provisions at 1.9% of Credit RWAs
• Cost of risk improved to 69bps for FY’17, better than full year 2,664 2,384
590 641 620 562
guidance of 70-75bps; 2018 guidance: 65-75 bps 562
Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 FY'16 FY'17
* annualised
NPLs and Provisions (AED Mn) Provision Coverage & NPL ratio
Dec'17 Sep'17 QoQ% Dec'16 YoY%
Provision Coverage (%) NPL Ratio (%)
NPLs 10,597 10,233 4% 9,280 14%
3.2 3.0 3.1
2.7 2.6
Provisions 12,728 11,153 14% 11,565 10%
Specific 4,581 4,105 12% 4,325 6% 125 122 112 109 120
General 8,147 7,049 16% 7,240 13% Dec'16 Mar'17 Jun'17 Sep'17 Dec'17
36Liability mix and Wholesale Funding
Liabilities mix
Wholesale Funding (AED Bn) Dec’17
Syndicated loan 7.3
Customer Term
Deposits Borrowings & Medium Term Notes/Bonds 34.8
70% AED 566.7 Bn Sub Debt
Dec’17 8%
Others Subordinated debt 0.4
6%
Total 42.6
Due to Banks
Commercial & Repos
Paper 12%
4%
Wholesale funding maturity profile (AED Mn)
Syndicated Loan MTN/MTB
7,707
10,320
5,903 7,331 7,358
250 3,278
2018 2019 2020 2021 2022 2023 & Beyond
37Customer deposits
Customer deposits (AED Bn) Customer deposits by account type (AED Bn)
Notice and time deposits Current Accounts
CASA (%) Total Customer Deposits
Saving Accounts Certificates of deposits
Margin Accounts
393.9 377.3 378.9 395.8
379.2 379.2 395.8
1% 1%
7% 9%
4% 3%
25% 26%
63% 61%
29% 29% 30% 30% 29%
Dec'16 Mar'17 Jun'17 Sep'17 Dec'17 Dec'16 Dec'17
Customer deposits by Counterparty (AED Bn) Customer deposits by geography1
Government sector
Public Sector
Corporate / private sector
Personal/retail sector
Certificates of deposits
GCC 2%
379.2 395.8 Asia 1%
7% 9%
20% UAE
18%
73% AED 395.8 Bn Europe
Dec’17 19%
38% 34%
20% 19%
MENA
15% 20% 3%
America
Dec'16 Dec'17
3%
1 - Based on booking centre
38Investment breakdown
Investments by type Investments by ratings
A
HFT - Debt 28%
17% HFT - Equity & BBB
Funds 12%
1%
Held to Maturity
(Debt) BB & below
AED 107.8 Bn AED 107.8 Bn
7% 7%
Dec’17 Dec’17
Unrated – Debt
AFS - Debt AFS - Equity & 2%
73% Funds Equity & Funds
2% AA 3%
35% AAA
13%
Investments by geography Investments by counterparty
Corporate/ Pvt Supranatl
Europe Sector 4%
17% 7%
UAE
36%
GCC Banks
15% 20%
AED 107.8 Bn
AED 107.8 Bn
Dec’17 Sovereign
Dec’17
43%
MENA (ex-
GCC&UAE)
Covered Bonds
4%
4%
USA
Asia
11%
16% Others incl A&NZ GREs
1% 22%
39Outlook
• Sustained global economic growth
• 2-3 Fed rate hikes expected in 2018
• Expansionary budgets across the GCC supported by firming oil prices > USD 50/barrel
Economy/
• UAE GDP growth to accelerate to 3.4% (vs. 1.3% in 2017) , led by Abu Dhabi recovery
Banking Sector
and pick up in government spending
• Faster economic growth to support credit growth ~mid-single digit
• Transition under way towards Basel III and IFRS9 implementation
• 2018 will be a year of consolidation: core businesses positioned well to achieve growth
and deliver further operating efficiencies
• Continued progress in integration journey with IT systems integration as next key
FAB milestone and end point of merger (around end of 2018)
• Strategic review/ implementation of international value proposition
• Process to obtain CMA and SAMA licenses in KSA well underway
40Financial guidance
2018 FINANCIAL GUIDANCE 2020 AMBITIONS
Loan Mid-single digit
GROWTH
Revenue Low single-digit
C/I Ratio
EFFICIENCY (ex-integration costs)
~26%-27% ~25%
ASSET QUALITY Cost of Risk1 65-75bps
Net profit growth Mid single-digit
PROFITABILITY
RoTE2 ~15% 16-17%
>13.5%
CAPITAL Basel III CET1 >13%
(vs. 14-15% previously)
1 - Year-to-date annualised
2 - Return on Average Tangible Equity, annualised; based on attributable profit to equity shareholders' excl Tier 1 notes coupon and amortisation of intangibles
41Contents
01 Introducing FAB
02 Integration Journey
03 Operating Environment
Q4/FY’17 Financial Review
04 Based on Pro forma financial information as of 31 December 2017
05 Appendix
42Q4/FY’17 Summary Financials
Full Year Quarterly
Income Statement - Summary (AED Mn) Note FY'17 FY'16 YoY % Q4'17 Q3'17 QoQ % Q4'16 YoY %
Net interest Income a 13,106 13,550 -3 3,363 3,244 4 3,392 -1
Fees & commissions, net 3,362 3,886 -13 932 788 18 968 -4
FX and investment income, net a 2,586 2,023 28 464 491 -5 652 -29
Other non-interest income 479 844 -43 289 89 226 90 220
Total Operating Income 19,533 20,302 -4 5,049 4,611 10 5,102 -1
Operating expenses (5,875) (5,922) -1 (1,616) (1,344) 20 (1,553) 4
Incl: Integration costs b (463) (178) 161 (198) (70) 183 (118) 68
Amortisation of intangibles (merger-related) (138) - - (138) - - - -
Impairment charges, net (2,384) (2,664) -10 (562) (562) 0 (590) -5
Non Controlling Interests and Taxes (358) (394) -9 (48) (100) -52 (105) -55
Net Profit 10,915 11,322 -4 2,822 2,605 8 2,854 -1
Adjusted Net Profit c 11,517 11,500 0 3,159 2,675 18 2,972 6
Basic Earning per Share (AED) d 0.96 1.00 -4 1.00 0.92 9 1.01 -1
a) Negative interest income booked on some placements has been reclassified to net FX income; NIM has been restated accordingly
b) Integration costs prior to 2017 are merger transaction-related costs
c) Adjusted Group Net Profit is stated before amortisation of intangibles (merger-related) identified as a result of the “purchase price allocation”, and excluding one-off
integration costs
d) Basic EPS based on attributable profits to equity shareholders' excluding Tier-1 notes coupon and outstanding shares
43Q4/FY’17 Summary Financials
Balance Sheet - Summary (AED Bn) Note Dec'17 Dec'16 YoY % Sep'17 QoQ %
Loans and advances e 330.5 334.4 -1 328.3 1
Customer deposits e 395.8 379.2 4 378.9 4
CASA (deposits) 116.0 108.5 7 112.4 3
Total Assets e 669.0 649.1 3 644.1 4
Equity (incl Tier-1 capital notes) 101.7 97.0 5 99.1 3
Tangible Equity f 71.1 71.9 -1 73.3 -3
e) Restated net of National Housing Program loans and deposits
f) Tangible equity is shareholders' equity net of Tier-1 capital notes, goodwill & intangibles
YoY
Key Ratios (%) Note FY'17 FY'16
(bps)
Net Interest Margin a 2.49 2.55 -6
Cost-Income ratio (ex-integration costs) 27.7 28.3 -59
Cost of Risk (bps) i 69 76 -7
Non-performing loans ratio j 3.1 2.7 41
Provision coverage j 120.1 124.6 -451
Loans-to-deposits ratio e 83.5 88.2 -472
Return on Tangible Equity (RoTE) g 14.8 15.7 -83
Return on Risk-weighted Assets (RoRWA) 2.3 2.3 0
CET1 ratio h 14.5 14.8 -32
Capital Adequacy ratio h 17.8 18.2 -34
g) Return on Average Tangible Equity, annualised; based on attributable profit to equity shareholders' excl coupon on Tier-1 capital notes (AED 465Mn - FY'17) and
amortisation of intangibles (AED 159 Million - FY'17)
h) As per UAE Central Bank's Basel III framework; figures prior to Dec 2017 are based on UAE CB's Basel II framework; CET1 ratio is based on Tier-1 capital
net of perpetual notes as a percentage of risk weighted assets
i) Loan-related impairment charges (net) as a percentge of average gross loans and advances (net of interest in suspense)
j) Gross loans and advances net of interest in suspense
Rounding differences may appear in above table
44Business Performance
Corporate & Investment Banking (CIB) 48% of Group
Revenue
2016 2017 AED Bn
+7% • Strong business momentum in Q4’17 led to 6% sequential growth in
revenue, while FY’17 revenues were down 5% on subdued loan market
-5%
+0.3% and lower trade activity
• Strong revenue growth was recorded in our Cash Management business
through a significant increase in mandates and strong Investment book
9.8 280.5 298.9 returns in Global Markets
9.4 232.8 233.5
-11% • Despite a subdued loan market, we were able to successfully execute
landmark transactions across Corporate Finance, specifically in Advisory
2.3 2.0 and Syndicated Loan markets
Revenue Expenses Loans Deposits • Our UAE business overall delivered a strong year on year result with risk
adjusted returns higher
• Disciplined cost management and realisation of synergies resulted in
lower costs by 11% yoy
Personal Banking Group (PBG) 35% of Group
Revenue
2016 2017 AED Bn
• PBG delivered a resilient performance in 2017 amidst a slowdown in
-8% retail spending and continued asset mix optimisation along with tighter
-3% risk appetite leading to margin compression
-3%
• Higher credit card and insurance-related fees in 4Q’17 supported a 2%
sequential growth in operating income
7.5 6.9 -13% 96.9 94.3 91.4 88.4 • Operating expenses reduced by 13% yoy indicating tight cost control
and realisation of substantial synergies post-merger
3.0 2.6 • Loans were 3% lower yoy reflecting disciplined lending and tighter risk
appetite
Revenue Expenses Loans Deposits • First FAB branded credit card “FAB Visa Infinite Credit Card” launched
post-merger
45Business Performance (continued…)
Subsidiaries of Group
7% Revenue
2016 2017
AED Mn AED Bn • FAB enjoys a highly diversified business model supported by
-21% -9% complementary offerings provided across real estate management,
+25% Islamic banking, brokerage, and credit cards through its subsidiaries
• FY’17 Revenues were down yoy, primarily due to lower property-related
1,662 income
1,309 +21% 9.1 8.3
6.9 • Integration of the real estate and property management businesses was
5.5 completed along with re-branding of the brokerage business into FAB
452 545 Securities; integration of the Islamic Finance subsidiaries is underway
Revenue Expenses Loans Deposits
International (Middle East & Africa, Asia Pacific and Europe & Americas)
2016 2017
-5% AED Mn AED Bn • FAB’s international business remains a key competitive advantage and
differentiator for the Bank as a significant contributor to liquidity and risk
+15% diversification
• FY’17 revenues were AED 2.43 Billion, down 5% yoy, primarily reflecting
2,569 2,432 +3% FX devaluation
-3%
94.0 107.9 • International revenues contributed 12% to Group’s total revenues
65.5 67.6 • While loans increased by 3%, FAB’s solid core deposit franchise led to a
879 853
15% growth in international deposits in 2017
Revenue Expenses Loans Deposits • As of December-end 2017, international loans and deposits represent
20% and 27% respectively of total Group loans and deposits
46Prestigious awards highlight FAB’s strength and
industry expertise in UAE and MENA
• Best Investment Bank in the
• Best FX provider in UAE
• Best Overall Cash Management Bank in the Middle East United Arab Emirates
• Best Bank for Liquidity Management in the Middle East • Best Bank for Financing in the
• Safest Bank in the UAE Middle East
• Safest Bank in the Middle East
• 4th Safest Bank in Emerging Markets
• 17th Safest Commercial Bank
• 31st Safest Bank in the World • Most Innovative Investment
Bank in MENA
• Best Bank in the UAE
• Best Brokerage Company (NBAD Securities)
• Best Fixed Income of the Year
• Best Consumer Finance Company in MENA
• UAE Asset Manager of the Year
(Dubai First)
47Prestigious awards highlight FAB’s strength and
industry expertise in UAE and MENA
- Best Trade & Supply Chain - Most Outstanding Islamic
Finance Solution Banking Window
- UAE Asset Manager of the
- Best Seamless Government
Year
- Digital Leader Award - Experience
Government
- Best Trade Finance Bank in - Sukuk House of the Year - UAE
MENA - Best Islamic Deal of the Year
- Best Islamic Structured Trade
Finance Deal of the Year
48Executed Landmark Transactions in 2017
DCM LCM CA/ECM
Abu Dhabi Crude Oil Government of Abu Dhabi APICORP Emaar Development Dubai Metro – Saudi Electricity ADNOC
Pipeline USD 10.0 bn USD 1.5 billion Department of Finance USD 1.75 billion USD 6 billion
USD 3.037 bn Senior Unsecured USD 500 mn Murabaha Facility USD 1.1 billion Term Loan Facility Term Loan Facility
Senior Secured 2.500% due 2022 Senior Sukuk Term Loan Facility Joint Coordinator,
3.650% due 2029 3.125% due 2027 3.141% due 2022 Sole Coordinator, Sole Mandated Lead Arranger
4.600% due 2047 4.125% due 2047 Bookrunner & Security Mandated Lead Arranger Mandated Lead Arranger & Bookrunner
Joint Global Coordinator Agent & Facility Agent & Bookrunner November 2017
& Joint Bookrunner Joint Bookrunner Joint Bookrunner September 2017 August 2017 August 2017
October 2017 October 2017 October 2017
Vedanta Resources National Bank of Kuwait Government of Indonesia Kuwait Food African Export-Import Reliance Industries ADNOC Distribution
USD 1.0 bn USD 3.0 bn USD 1.425 billion Bank USD 1.75 billion USD 2.25 billion
Senior Unsecured Notes USD 750 mn Senior Unsecured Term Loan Facilities USD 1.65 billion Term Loan Facility Term Loan Facility
6.125% due 2024 (7NC4) Senior Unsecured Notes Dual Tranche Sukuk Term Loan Facility Sole Coordinator, MLA,
2.750% due 2022 3.400% due 2022 Bookrunner and Facility
4.150% due 2027 Sole Bookrunner, & Mandated Lead Arranger Mandated Lead Arranger Agent
Joint Global Coordinator Facility Agent & Bookrunner & Bookrunner November 2017
and Joint Bookrunner Joint Bookrunner Joint Bookrunner June 2017 June 2017 March 2017
July 2017 May 2017 March 2017
Majid Al Futtaim Government of Oman
Hong Kong Vedanta Plc EMAAR Development
Telecommunications
USD 500 mn USD 1.0 bn USD 600 million USD 575m AED 4.8bn
Reset Subordinated Notes Senior Sukuk Term Loan Facility Initial Public Of f ering
Term Loan
5.500% Perpetual 3.132% due 2027 Joint Global
NC5.5 year Mandated Lead Mandated Lead Arranger Coordinator, Joint
Arranger & Bookrunner & Bookrunner Bookrunner & Lead
Joint Bookrunner Joint Bookrunner May 2017
February 2017
Receiving Bank
February 2017
2017 Nov ember 2017
49THANK YOU!
For more information, please visit
www.bankfortheuae.com
or
contact FAB Investor Relations team
ir@bankfab.com
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