Recommended
More Related Content
Viewers also liked
More from lcchong76
More from lcchong76 (17)
Recently uploaded
Recently uploaded (20)
Bank Industry (KLSE) - Peer Comparison
- 1. BANK INDUSTRY PEER COMPARISON 8 November 2015 L. C. Chong
- 2. DISCLAIMER I am NOT an investment advisor nor a financial advisor, and no information provided here is to be interpreted as a suggestion to buy or sell securities. Stock analysis in this presentation may not neutral because I have incorporated my risk appetite and principles in the analysis. 2
- 3. DECLARATION OF INTEREST • At the time of writing, I owned shares of PBBANK.
- 5. SCOPE • Figures and ratios are based on the figures reported in Annual Report or the latest Q4 Quarterly Report (QR) • Comparisons are made merely based on financial figures • Growth drivers and risks/challenges are not covered here • Valuation is not covered in this analysis.
- 6. CHANGES • 3 Nov 2015 – First write up in PowerPoint format • 8 Nov 2015 – Applied new template
- 7. PROFITABILITY 0.769% 0.930% 0.952% 1.001% 1.059% 1.181% 1.228% 1.315% 1.382% 0.000% 0.500% 1.000% 1.500% CIMB AFFIN RHBCAP BIMB MAYBANK AFG HLBANK PBBANK AMMB Net Income % Tangible Assets 7.6% 8.1% 10.8% 12.7% 13.3% 13.5% 13.6% 16.1% 18.1% 0.0% 5.0% 10.0% 15.0% 20.0% AFFIN CIMB RHBCAP MAYBANK HLBANK AFG AMMB PBBANK BIMB Return on Equity 1.9% 2.0% 2.2% 2.2% 2.3% 2.3% 2.7% 2.8% 3.0% 0.0% 1.0% 2.0% 3.0% 4.0% AFFIN HLBANK AFG PBBANK MAYBANK RHBCAP AMMB CIMB BIMB Net Interest/Income Margin
- 8. PROFITABILITY (CONT.) • In term of “Net Income % Tangible Assets”, from FY10 and FY13, PBBANK was the champion, but in FY14, AMMB took over the crown. AMMB managed to achieve this because they boosted the loan-to-deposit to 97%. This strategy is not sustainable in long term • For “Return on Equity”, from FY10 and FY13, PBBANK was the champion, but in FY14, BIMB took over the crown. in FY14, BIMB reduced substantial amount pay out to “Non-controlling Interests” – from 283,827 (FY13) to 54,575 (FY14) • As for “Net Interest/Income Margin”, PBBANK is at the middle of the table. BIMB, CIMB and AMMB are the top 3, but later we will look into the quality of loans.
- 9. EFFICIENCY 59.0% 58.9% 58.1% 54.7% 53.9% 46.6% 45.0% 44.6% 30.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% CIMB BIMB MAYBANK RHBCAP AFFIN AFG AMMB HLBANK PBBANK Cost to Income Cost-to-income of PBBANK obviously is the lowest in this industry. It means that PBBANK is the most efficient bank
- 10. ASSET RISK 3.1% 2.0% 1.9% 1.8% 1.5% 1.1% 0.8% 0.7% 0.6% 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% CIMB RHBCAP AMMB AFFIN MAYBANK BIMB HLBANK AFG PBBANK Problem loans % of gross loans Quality of loans of PBBANK is obviously the best in the industry. Despite NIM of CIMB, AMMB and RHBCAP are higher than PBBANK, you can see quality of loans of the three banks are not good.
- 11. CAPITAL ADEQUACY 8.6% 11.6% 12.0% 12.3% 12.4% 12.7% 12.8% 13.5% 13.9% 0.0% 5.0% 10.0% 15.0% BIMB AMMB AFG HLBANK CIMB RHBCAP PBBANK MAYBANK AFFIN Tier 1 Ratio 6.1% 6.8% 10.1% 10.7% 11.9% 12.6% 12.7% 13.2% 14.5% 0.0% 5.0% 10.0% 15.0% 20.0% CIMB BIMB AMMB RHBCAP PBBANK AFG HLBANK MAYBANK AFFIN Tangible Common Equity % RWA Regulatory capital of all banks already met Bank Negara’s requirements.
- 12. FUNDING STRUCTURE & LIQUID RESOURCES 72.6% 79.9% 80.0% 81.1% 88.0% 89.5% 91.5% 91.8% 97.2% 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 120.0% BIMB HLBANK AFFIN AFG PBBANK RHBCAP CIMB MAYBANK AMMB Loan-to-deposit 16.4% 15.3% 15.1% 14.5% 10.5% 10.0% 9.0% 6.6% 0.0% 5.0% 10.0% 15.0% 20.0% CIMB RHBCAP AMMB MAYBANK AFFIN PBBANK HLBANK AFG Market funds % Tangible Banking Assets 17.1% 19.5% 20.7% 22.3% 22.7% 23.2% 26.6% 28.4% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% AMMB CIMB MAYBANK RHBCAP PBBANK AFFIN AFG HLBANK Liquid Banking Assets % Tangible Banking Assets
- 13. FUNDING STRUCTURE & LIQUID RESOURCES (CONT.) 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% FY10 FY11 FY12 FY13 FY14 Liquid Banking Assets % Tangible Banking Assets AFFIN AFG AMMB CIMB HLBANK MAYBANK PBBANK RHBCAP
- 14. FUNDING STRUCTURE & LIQUID RESOURCES (CONT.) • Loan-to-Deposit – PBBANK is at the middle of the table. Compare MAYBANK and CIMB, PBBANK still has a small room to increase loans (if they want to) • Market funds % Tangible Banking Assets – Compare to MAYBANK and CIMB, liability-side volatility and liquidity risks of PBBANK is quite low • Liquid Banking Assets % Tangible Banking Assets – Although PBBANK is at the middle of the table, compare to other banks, in the past 5 years, PBBANK has been increasing their liquid banking assets constantly.
- 15. MARKET RISK APPETITE 59.1% 29.6% 26.5% 23.6% 21.5% 14.7% 9.1% 7.9% 5.6% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% CIMB MAYBANK AMMB RHBCAP HLBANK BIMB PBBANK AFFIN AFG MARKET RISK APPETITE PBBANK is a very conservative bank in taking market risk. You can see how high market risk appetite of CIMB is, and what happened to CIMB performance now.