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Dubai Islamic Bank

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Dubai Islamic Bank Investor Presentation May 2008 Contents Highly Profitable Banking Sector Booming Islamic Banking Market Islamic banking is one of the fastest ... – PowerPoint PPT presentation

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Title: Dubai Islamic Bank


1
  • Dubai Islamic Bank
  • Investor Presentation
  • May 2008

2
Contents
Background About DIB DIB Financials Peer
Group Stock Information
3
Highly Profitable Banking Sector
  • Sector comprises of 49 banks
  • 22 national/local banks 27 foreign banks
  • Sector of strategic importance to Govt.
  • Direct/indirect govt. ownership in majority of
    national banks
  • Precedents available for Govt. support
  • Sector dominated by the national banks
  • Top 10 banks account for approximately 60-70 of
    total banking sector assets
  • Sector experiencing strong growth

Source UAE Central Bank
4
Booming Islamic Banking Market
  • Islamic banking is one of the fastest growing
    industry segments in the Financial Services
    sector
  • Growth momentum, both in the Arab world and
    globally, estimated at 20 p.a. plus
  • Approximately 400 Islamic institutions globally
    with assets in excess of US 500 billion
  • More than US 20 billion in international Islamic
    bond issuance to date
  • Targeted regions include GCC, South Asia, South
    East Asia and select niche markets
  • Entry by Global Commercial/ Investment banks in
    this sector

Key Players in the Islamic Banking Market in UAE
/ Middle East Region
Existing Players
New Entrants
5
Contents
Background About DIB DIB Financials Peer
Group Stock Information
6
Dubai Islamic Bank
The Worlds First Islamic Bank
Part of the Big Five Islamic Banks in the world
Globally recognized Leader and Innovator in
Islamic Banking
The largest Islamic Bank in UAE Amongst the top
4 Banks in the country
Government ownership 34
Strong Domestic Franchise Nearly 600,000 retail
customers 49 branches / nearly 300 ATMs, CDM
7
Rated A1 by Moodys and A by SP
  • One of the Worlds Top Islamic Banks
    Systemically important to its domestic banking
    market
  • Key Strengths
  • Robust and sustainable financial performance
  • Strong liquidity
  • Likely government support in case of need
  • Solid risk-monitoring architecture, improving
    asset quality
  • Profitability Improved and of good quality,
    reflecting superior business diversification

A
DIBs ratings reflect its strong franchise as a
leading Islamic Financial Institution, its
relationship with the Dubai government and its
satisfactory financial fundamentals
  • DIBs foreign currency issuer ratings are set at
    A1/Prime-1 based on the banks intrinsic safety
    and soundness and on a strong likelihood of
    external support from the UAE authorities and
    DIBs main shareholders in case of need.
  • DIBs relationship with the Dubai government
    enhances its franchise
  • DIBs foreign currency issuer ratings benefit
    from a high degree of external support
  • Increasing earning power and profitability
  • DIB enjoys a good deposit base, with a lower
    deposit concentration than other UAE banks

A1
8
DIBs principal business is focused on its five
core units
  • Largest business unit within DIB
  • Full range of products and services
  • Customer segments Mass affluent, Wealth
    management, SME
  • One of the largest Retail customer base in UAE
  • Market leaders Deposits products and Auto finance

Retail Business Banking
  • Millennium Capital and Millennium Finance
    subsidiaries incorporated in Dubai International
    Financial Centre
  • Investment banking activities such as project
    finance, loan syndication, capital markets, asset
    management and structured finance as well as
    Corporate Advisory Services
  • Global leaders in Sukuk issuance 1 in the
    Bloomberg league table in 2006

Investment Banking
  • Leading provider of Real Estate Finance services
    in the UAE with significant role in supporting
    real estate developments
  • Financing to contractors in the oil, gas, power
    and water sectors
  • Short term equity investments in established
    companies and business start-ups across MENA
    region

Real Estate, Contracting Finance, Direct Equities
  • Large Middle Market
  • Bankers to top corporate houses in GCC
  • Financing for Trade and Manufacturing and
    Infrastructure
  • Cash Management capabilities

Corporate Banking
  • Foreign exchange services
  • Asset-liability management
  • Islamic derivatives

Treasury
9
Dubai Islamic Bank Strategic Agenda
Growth drivers to be Retail, Corporate Banking
Investment Banking
Leveraging on the success in Dubai to capitalize
on opportunities in other Emirates
To be amongst the Top 3 Banks in UAE
Continually innovate using the latest technology
and product expertise leading to ease and
convenience
Focus on Value Growth cross selling, new
Islamic products embed cost awareness
Evolving from a pure banking entity to a more
comprehensive Financial Services Group
Diversifying DIBs revenue streams through
penetration and presence in new markets in the
MENA region
10
Portfolio Diversification, Business Overview
  • Diversified portfolio both with respect to
    economic sectors and customer segments
  • Key economic sectors include government / public
    sector and real estate
  • Among the most significant Arrangers of financing
    for Dubai Government

Segmental Revenue of Total Revenue (2007)
Sectorial Exposure of Financial Assets (2007)
11
An Integral, Recognized player in the Islamic
Finance sector
  • Mega Deals
  • US 3.52 Bn Sukuk issue for Nakheel (Dubai World)
  • US 3.5 Bn Sukuk issue for PCFC (Govt of Dubai)
  • US 2 Billion Sukuk for Dubai Civil Aviation for
    expansion project of Dubai International Airport
  • US 600m Government of Malaysia Sukuk
  • US 600m Pakistan Sovereign Sukuk
  • US 550m Sukuk for Emirates Airlines
  • US 530m Lead Arranger for Qatar Gas II
  • Awards Accolades (2005-07)
  • Best Bank in UAE, 2006 The Banker
  • Best Islamic Bank in ME, 2006 Euromoney
  • Best Debt house UAE, 2005 Euromoney
  • Best Sukuk House, 2005 Euromoney
  • Award for Finance (2005) Shaikh Mohammed Bin
    Rashid Business Award
  • Quality Recognition Award, 2005 JP Morgan Chase
  • Banking Achievement Award for the Middle East, by
    Emerging Markets Publication during the IMF
    Conference in New York, Oct07

12
Contents
Background About DIB DIB Financials Peer
Group Stock Information
13
Key Financials Trend
Net Profit USD Million
  • Maintaining robust profitability
  • About 12-fold growth in net profits over the last
    5 years
  • Improved profitability attributed to both growth
    in core business and growth in Islamic market

Total Assets USD Billion
  • Strong and consistent growth in total assets.
    Increase of 4 times over last 5 years
  • Focus on quality and portfolio mix of assets
    along with aggressive growth

13
14
Key Financials Trend
Total Deposits USD Billion
  • Strong and consistent growth in total deposits
  • DIB is the 3 bank in customer deposits in UAE

Total Financing USD Billion
  • More than 4 fold growth in gross financing in 5
    years
  • Well diversified and balanced portfolio, with
    lending to all key industry sectors

14
15
Key Financials Trend
ROE
  • Consistent growth in ROE, in line with the top 5
    banks
  • Marginal drop in 2006 attributed to increase in
    capital of US906 million

ROA
  • Steady growth in ROA in last 5 years
  • Return on assets of 3.4, in the top end among
    major UAE Banks

15
Source Bloomberg
16
Strong deposit base to support growth plans
16
17
Key Financials Trend
Cost-Income
  • Cost to Income at 40
  • Increased due to investment in new branding, new
    branches, improved systems and channels

Advances to Deposits
  • Healthy liquidity maintained compared to peer
    banks in UAE

17
18
Contents
About Dubai, UAE About DIB DIB Financials Peer
Group Stock Information
19
Domestic peer group comparison
Net Profit Growth USD Million
  • DIB net profits CAGR is the highest among
    comparable peer banks
  • Net profits among the top 3 banks in UAE

Total Assets USD Billion
  • Total assets among the top 5 banks in UAE

20
Domestic peer group comparison
  • Total deposits among top 3 banks in UAE

Total Deposits USD Billion
Total Financing USD Billion
  • Total financing among the top 5 banks

21
Domestic peer group comparison
ROE 2007
  • ROE top amongst peer banks
  • Compares favorably with major banks globally

ROA 2007
  • ROA among top 3 banks

21
Source Bloomberg
22
Domestic peer group comparison
Cost Income Ratio 2007
  • Increased due to infrastructure spend,
    technology, new branches, and staff packages in
    line with the market

Financing to Deposit 2007
  • Most liquid amongst banks in UAE

22
Source Bloomberg
23
Contents
About Dubai, UAE About DIB DIB Financials Peer
Group Stock Information
24
Key Metrics Bloomberg ID DIB UH Equity
Key Indicators USD
US 3.40
Current US 2.50
US 2.40
Face value for 2003, 2004 equated to 0.27/
share Source DFM, DIB Published accounts
24
25
Dividend payments
  • Steady growth in dividend payments to
    shareholders
  • 2006 and 2007 dividend includes payment of bonus
    through shares of 7 and 15 respectively

Dividend Payment History
25
26
DIB Shares
Share Trading on DFM
YTD Mar 2008
DFM trading volume (bn) 26.34
DIB trading volume (bn) 0.81
DIB of DFM Volume 3.07
   
DFM trading value (USD Bio) 34.14
DIB trading value (USD Bio) 2.49
DIB of DFM Value 7.29
   
DFM Market Cap Value (USD Bio) 126.81
DIB Market Cap Value 8.77
DIB of DFM Market Cap 6.91
  • Highly Liquid
  • DIB capitalization as a of total DFM 6.9
  • 5th largest market capitalization
  • Percentage of DIB shares allowed to be owned by
    foreigners 15

Source DFM
The information provided in this presentation
should not be used as a substitute for any form
of advice. Decisions based on this information
are for your own account and risk. Although DIB
attempts to provide accurate, complete and
up-to-date information, which has been obtained
from sources that are considered reliable, DIB
makes no warranties or representations, express
or implied, as to whether information provided is
accurate, complete or up-to-date.
26
27
  • THANK YOU
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