2016 Annual Results Presentation...chinafigcsgsgh\ABC\2012...

$: 2016 Annual Results Presentation...chinafigcsgsgh\ABC\2012 NDR\Presentation\2011年业绩推介_v03_WP.pptx Profitability: Stable Growth in Net Profit Net Profit RMB100MM 4 ROAA ROAE$
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chinafigcsgsgh\ABC\2012 NDR\Presentation\2011年业绩推介_v03_WP.pptx

March, 2017

2016 Annual Results Presentation

IFRS

Hong Kong/Beijing

1


Disclaimer

Information contained in this material does not constitute an offer of, or an invitation to purchase

or subscribe for, the securities of the Agricultural Bank of China Limited (the “Company”) in Hong

Kong, the United States or other areas. The securities of the Company has not been registered

under the United States Securities Act of 1933, as amended, and may not be offered and sold in

the United States, unless they are registered under applicable laws or an exemption from the

registration requirements is obtained.

This disclaimer contains statements which are defined as “forward-looking statements” within the

meaning of Section 27A of the U.S. Securities Act of 1933, as amended and Section 21E of the

U.S. Securities Exchange Act of 1934, as amended. Such forward-looking statements are

subject to known and unknown risks, uncertainties and other factors, and are based on the

current expectations, assumptions, predictions and forecasts of the industry in which the

Company currently engages. Unless otherwise required by law, the Company undertakes no

obligation to update any forward-looking statements to reflect any subsequent events or

circumstances, nor does the Company bear any obligation to make any corresponding changes

to its expectations. Although the Company believes that the expectations contained in the

forward-looking statements are reasonable, no assurance can be given by the Company to you

that the Company’s expectations will prove correct in future, and investors should note that

actual results could differ from those expected.

1

2


Financial Performance

Business Development

Future Outlook

2

3


Performance Summary

31 Dec 2016 RMB100MM 31 Dec 2015

3

Change

2016 2015

Net Interest Income 3,981 4,361 8.7%

Net Interest Margin (NIM) 2.25% 2.66% 0.41pps

Net Fees and Commissions 909 825 10.2%

Cost-to-income Ratio 34.6% 33.3% 1.3pps

Net Income 1,841 1,808 1.8%

Basic EPS 0.55 0.55 - -

Change

Total Assets 195,701 177,914 10.0%

Loans and Advances 97,196 89,099 9.1%

Total Liabilities 182,485 165,795 10.1%

Deposits 150,380 135,384 11.1%

CET1 Capital Adequacy Ratio 10.38% 10.24% 0.14pps

NPL Ratio 2.37% 2.39% 0.02pps

Provision Coverage 173% 189% 16pps

4


Profitability: Stable Growth in Net Profit

Net Profit

RMB100MM

4

ROAA

ROAE

1,795 1,808 1,841

2014 2015 2016

1.18% 1.07%

0.99%

2014 2015 2016

19.57% 16.79%

15.14%

2014 2015 2016

5


Net Interest Income: Net Interest Income Declined and

Interest Margin Ahead of Peers

Net Interest Income Declined YoY

RMB100MM

Interest Margin Ahead of Peers

2.92% 2.66%

2.34%

6.06% 5.52%

4.51%

1.85% 1.81% 1.47%

2014 2015 2016

Net Interest Margin (NIM) Average Loan Yield

Average Deposit Cost

Daily Average Balance of Interest-bearing Assets

Continued to Grow

RMB100MM

146,974 163,830

176,903

2014 2015 2016

Excluding VAT Impact

4,299 4,361

3,981

2014 2015 2016

5

6


48

90 90 100

Bancassurance E-banking

2015 2016

Net Fee and Commission Income: Accelerated Growth

Net Fees and Commissions

RMB100MM

6

Solidified Leading Position in Channel Businesses

Emerging Businesses Maintain High Growth

801 825

909

2014 2015 2016

RMB100MM

100

17

113

26

Wealth Management Precious Metals for Trading

2015 2016

RMB100MM

7


Costs and Expenses: Keep Declining

Operating Expenses Declined YoY

RMB100MM

7

Cost-to-income Ratio Maintained Stable

Excluding VAT Impact

2,239 2,258

1,970

2014 2015 2016

34.56%

33.28% 33.50%

2014 2015 2016

8


Asset Quality: Generally Stable with Decreased NPL Ratio

NPL Balance Grew Moderately and NPL Ratio

Decreased Slightly vs. Beginning of This Year

RMB100MM

8

Normal Loan migration ratio Decreased YoY

1,250

2,129 2,308

1.54%

2.39% 2.37%

2014 2015 2016

264 210

256

333 307

730

Recovery Write-off Bulk Transfer

2015 2016

Strict and Prudent Asset Classification Multiple Initiatives to Contain Non-Performing Assets

131%

119%

2015 2016

Overdue Loans / Non-Performing Loans

Decreased 12

Percentage

Points

3.60%

4.96%

3.00%

2014 2015 2016

9


Provision Coverage: Strong Risk Buffer

Sufficient Loan Provisions

RMB100MM

9

Provision Level Ahead of Peers

287%

189%

173%

4.42% 4.53%

4.12%

2014 2015 2016

Provision Coverage Allowance to Loans

3,581

4,032 4,003

2014 2015 2016

10


Capital Adequacy Ratio: Continues to Meet Regulatory

Requirements

Capital Adequacy Ratio

10

9.09%

10.24% 10.38%

9.46%

10.96% 11.06%

12.82%

13.40% 13.04%

2014 2015 2016

CET 1 Capital Adequacy Ratio Tier 1 Capital Adequacy Ratio Capital Adequacy Ratio

11




Future Outlook

11

12


Corporate Banking Business: Stable Development with

Continued Structural Transformation

Corporate Deposits Increased Rapidly

RMB100MM

12

Exposure to High Risk Industries Continued to Drop

44,373 48,218

55,997

2014 2015 2016

RMB100MM

New Loans to Key Projects Increased Significantly

RMB100MM

2,386

3,598

New Loans in 2015 New Loans in 2016

11,600

9,474

2015 2016

Note: Include wholesale, coal, steel and low-end manufacturing industries

SME Loans Grew Faster than Total Loans

RMB100MM

9,749 10,882

12,036

2014 2015 2016

Increased

RMB121.2

Bn YoY

Dropped by

RMB 212.6 Bn

vs. Beginning of

the Year

Note: Key projects are key construction

projects at the national and provincial levels

13


Retail Banking Business: Further Solidified Leading

Position

Growth in Personal Deposits Ahead of Peers

RMB100MM

13

Rapidly Growing Personal Loans

Accelerated Growth of Private Banking Business

74,223 80,656

88,151

47.8% 48.3% 51.5%

2014 2015 2016Personal Deposits Demand Deposit as % of Total Personal Deposits

RMB100MM

10K Users, RMB100MM

23,966 27,279

33,409

2014 2015 2016

4.6

6,374

7

8,184

Contracted Customers Financial Assets of Customers2015 2016

Rapidly Growing Credit Card Business

10K Cards, RMB100MM

5,838

11,540

6,863

13,384

Cards Issued Annual Spending on Credit Card

2015 2016Note: Customers with average daily financial asset balance of >RMB5MM

14


County Business: Overall Contribution Continues to Rise

Growth in County Deposits and Loans

RMB100MM

14

Significant Overall Contribution

RMB100MM

Remarkable Achievements in Key Areas Financial Services with Optimized Business Structure

RMB100MM

0 369

2,323 3,366

7,034

2,567 1,676

528

2,746

4,000

9,438

2,176

Farmer Settle-downLoans (New Scope)

Agricultural OperatingEntity Loans

County WaterConservancy

Construction Loans

County AreaUrbanization Loans

Farmer HouseholdLoans (PBOC Data)

County High-RiskIndustry Loans (CountyWholesale, Real Estate,

Steel Industries)2015 2016

28,602 31,783

2015 2016Loans

58,002 64,211

2015 2016Deposits

2016

54%

New County Personal Loans as % of

New Loans of Entire Bank

3.33%

2.91%

County Entire BankInterest Spread of Deposits and Loans

42BPs

Higher

15


31.6%

40.3%

0.6%

0.0%

38.6% 30.1%

12.7% 17.0%

4.2% 3.6%

12.3% 9.0%

2015 2016

Government PBOC

Policy Banks Other Financial Institutions

Public Entities Corporates

Increased by

8.7 Percentage

Points

Financial Markets Business: Stable Increase in Total

Investments with Leading Yields

Continuous Growth of Non-restructuring Debt

Securities with Leading Yields

RMB100MM

15

Higher Proportion of Government Debt Securities

28,592

38,851

47,897

4.15% 4.14%

3.74%

2014 2015 2016

Non-restructuring Debt Securities BalanceYield

16


71,451

23,792

3,183

90,039

28,350

3,721

Assets under Custody Insurance Assetsunder Custody

Pensions

2015 2016

Asset Management Business: Rapid Growth in Both Size

and Revenue

Continuous Expansion in Daily Average Balance of

Wealth Management Business

RMB100MM

16

Rapid Growth in Assets under Custody

11,881 13,491

16,740

2014 2015 2016

RMB100MM

Stable Growth in Wealth Management Revenue

RMB100MM

77

100 113

2014 2015 2016

17


Internet Finance: Stable Progression with Continued

Improvement in Channel Services

17

Rapid Growth in Internet Finance 互联网金融创新试点进展良好 Financial Services Platform

RMB Tn

58.6

6.0

77.1 63.1

14.7

73.2

Mobile Banking andpersonal Online Banking

Transaction Volume

Of which: Mobile BankingTransaction Volume

Corporate Online BankingTransaction Volume (New

Scope)2015 2016

Social Network Platform

140MM Users

4.77MM Users

260MM Users

170MM Users

9.66MM Users

290MM Users

Mobile Banking Users WeChat BankingUsers

Messaging ServiceUsers

2015 2016

E-Commerce Platform

10K Users, RMB100MM2

209.4

314.7

93%

96%

2015 2016E-banking Financial Transactions

% of Electronic Financial Transactions

5.9

7.1

2015 2016

Internet Finance Customers

100MM Users, RMB Tn

14.3 348

15.3

70.3

1470

32.9

e-Agriculture / e-Commerce Platform

Merchants

e-Agriculture / e-Commerce Transaction

Volume

e-Commerce Revenue

2015 2016

18


International Business and Comprehensive Operations:

Improved Cross-border Financial Service Capabilities

Key Subsidiaries Progress Steadily

RMB100MM

Enhanced Cross-border Service Capabilities

1,097 1,093

532

906

2015 2016 2015 2016

1,258 1,481

7.8 11.6

2015 2016 2015 2016

Note: Includes ABC-CA Fund Management, ABC International, ABC Leasing, and ABC Life

Total Assets Net Income

Network Coverage in Asia, Europe, North America, Pacific, and Africa

Taipei

London

Frankfurt

Tokyo

New York

Seoul

Singapore

Sydney

Hong Kong

ABC International

ABC Finance

Vancouver

Hanoi

Dubai

Luxemburg

Europe

Asia-Pacific

Americas

China-Congo Bank Africa

Moscow

Operational Entity

In planning and

application

In Planning and

Application

Joint Venture

Representative Office

18

Free Trade Zone Loans (RMB100MM)

Total Assets of Overseas Institutions (US$100MM)

19



19


Future Outlook

20


6-dimensional Strategy

Future Outlook – Strategic Goal and Implementation Plan

Strategic goal: strive to become a first-class international commercial bank group

with unique operations, efficient services, comprehensive and synergetic functions,

and exceptional value creation capabilities

1 Core 2 Mainstay

3 Positioning

4 Anchor

5 Strength

6 Switch

1 Core:

Build stronger

management

team at different

levels under the

leadership of the

Party

2 Mainstay:

Development of

the business

Development of

the Party

3 Positioning:

Serve Sannong

and enhance

county business

Focus on and

improve urban

business

Leverage group

strength and

achieve higher

returns

4 Anchor :

Risk management

Human resources

Technology

system

Corporate

governance

5 Strength :

Serve real

economy

Case prevention

and risk control

Value creation

Market

competitiveness

Sound and

sustainable

business

6 Switch:

Management

philosophy

Organizational

structure

Profit model

Operational

procedures

Motivation

mechanisms

Business model

20

21


Future Outlook – Business Initiatives for 2017

Focus on supply side reform and improve credit extension

Serve “Sannong” and enhance county business to further improve financial

services quality for “Sannong” business

Strengthen liability business with balanced growth between volume and

price

Solidify existing advantages and expand new businesses for revenue

diversification

Continue to decrease costs by strictly controlling funding costs and

operational costs

Prioritize risk management and focus on asset quality

Enhance compliance measures and build strong business foundation to

ensure sound and efficient operations

21

22


Thank you!

Q&A

22

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