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Halyk Group Financial Results Presentation 1Q 2020

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Halyk Group Financial Results Presentation 1Q 2020 October 2020 Disclaimer Certain information contained in this presentation may include forward-looking statements. Such forward-looking statements are not guarantees of future performance. These statements are based on management’s current expectations or beliefs as of the date of this presentation and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. The Bank disclaims any intention or obligation to publicly update or revise any forward- looking statements. The alternative performance measures (“APMs”) disclosed in this presentation are unaudited supplementary measures of the Halyk Group’s performance and liquidity that are not required by, or presented in accordance with, IFRS. These measures are not defined by IFRS and the Halyk Group’s use and definition of these metrics may not be comparable to similarly titled APMs used by other companies in the financial industry due to differences in accounting policies or differences in the calculation methodology. These APMs have limitations and should not be considered in isolation, or as substitutes for financial information as reported under IFRS. Accordingly, undue reliance should not be placed on the APMs presented in this presentation. The Halyk Group has included these measures because it believes that they enhance an investor’s understanding of the Halyk Group’s financial performance. The Halyk Group also believes that these APMs are commonly used by investors in comparing the performance of businesses. The management of the Halyk Group uses these measures to monitor and analyse Halyk Group’s performance. Basis of calculation: - all figures in this presentation are based on IFRS audited financial statements or financial statements reviewed by auditors, unless stated otherwise; - the figures shown in this presentation for the 7, 8 and 9 months of 2020 and any monthly figures has been extracted from unaudited management accounts and financials statements. The areas in which management accounts might differ from IFRS could be significant 2 Speakers Umut Shayakhmetova Anton Musin Murat Koshenov, CFA Dauren Sartayev CEO, Halyk Bank First Deputy CEO, Digital Banking, Deputy CEO, Corporate Banking Deputy CEO, SME Banking, Transactional Business and IT & International Activities PR and Marketing Zhumabek Mamutov Viktor Skryl Almas Makhanov Mira Kasenova Deputy CEO, Retail Banking Financial Director, Chief Risk Officer and Head of FI and IR Finance & Subsidiaries Compliance Controller 3 Resilient performance amid new macro challenges Key investment highlights Strategic update Digital strategy update Table of contents Retail banking Corporate banking SME banking International & subsidiary business Financial performance overview 4 01 Resilient performance amid new macro challenges 5 Resilient performance amid new macro challenges Macro challenges Halyk responses Two lockdowns Support for communities and stakeholders . 1st lockdown ( March 16 – May 11) All enterprises and organizations suspended their activities and all Businesses People Employees major cities were closed for quarantine with self-isolation regime . 2nd lockdown ( July 5 – August 17) All state programs Up to 3 months debt Remote work for 64% and exemptions payment holidays of employees The measures aim to limit certain social activities and large people gatherings and imply less severe economy closure Concessional Lending > 1.9 mln social to SMEs payments transferred Significant government stimulus > 413k payments Debt payment holidays transferred to socially USD 14.5bn or aprx. 10% of GDPGovernment support in Kazakhstan to SME borrowers vulnerable people Retail SME “Economy of Halyk responses KZT 1trln Employment KZT 1trln Strong performance Roadmap Simple Things” KZT 384bn Support for socially KZT 800bn Concessional . 22.6% ROAE in 1H 2020 vulnerable categories lending to SMEs . 25.8% Cost / Income in 1H 2020 KZT 370bn Social payments KZT 240bn Expansion of state . NPL 90+ days – 6.9%, NPL 90+ days coverage ratio – 148.4% as support programs Debt payment of 1H 2020 3 months holidays for retail 3 months Debt payment holidays for SMEs Double shock from the collapse in oil prices Loan book resilience and COVID-19 . Well diversified loan book with 26.7% represented by Retail . Macroeconomic stabilization supported by the gradual lifting of segment, 15.8% by SME lending and 57.4% by corporate loans lockdowns and oil prices recovery . Most affected sectors comprise 14.5% of the gross loan book(1) 6 (1) as of 30 June 2020, Bank only Epidemiological situation in Kazakhstan Overview Kazakhstan in comparison Confirmed cases per 100,000, as of 1 October 2020 Current situation as of 1 October 2020: Number of tests, ths per 100,000 USA 107,979 / 32,979 573.7 Confirmed COVID / Pneumonia1 Confirmed COVID cases cases per 100,000 Russia Kazakhstan UK Germany 102,937 / 27,242 1,725 / 355 Uzbekistan COVID-19 / Pneumonia1 COVID-19 / Pneumonia1 Georgia recoveries deaths Time since 100 confirmed cases (day) Daily cases per 100,000, as of 1 October 2020 2,964,281 15,740 Number of tests conducted Number of tests per 100,000 USA Georgia Kazakhstan position in the world: UK Russia #36 by the number of confirmed cases Uzbekistan Germany #66 by the number of confirmed cases per 100,000 Kazakhstan #29 by the overall number of tests conducted Time since 100 confirmed cases (day) Deaths & recoveries per 100,000, as of 1 October 2020 ➢ The first case of COVID-19 in Kazakhstan was registered on 13th of 1,429 n.a. 665 309 547 161 93 March 2020 ➢ Started from 1 August 2020 reported statistics include both COVID-19 confirmed cases and cases of pneumonia with COVID-19 like symptoms but with negative PCR test Deaths per 100 000 Recoveries per 100 000 (1) Cases of pneumonia with COVID-19 like symptoms but with negative PCR test 7 Source: Worldometer Timeline of COVID-19 effect on economy 1Q 2Q 3Q State of Emergency The 2nd lockdown Air traffic (domestic/external) NR NR FR FR PR NR NR NR Transportation (cargo) NR NR NR NR NR NR NR NR Public transport NR NR PR PR NR NR NR NR Transport Intercity transport NR NR FR NR PR NR PR PR Industrial sector/oil & gas NR NR FR NR NR NR NR NR production Industry Construction Grocery stores/pharmacies NR NR NR NR NR NR NR NR Non-Food stores up to 500 m NR NR FR FR NR NR NR NR Malls/bazaars NR NR FR FR FR NR PR PR Retail Retail trade Entertainment NR NR FR FR FR NR FR FR establishments/fitness centers Restaurants NR NR PR PR PR PR PR PR & leisure Cinema NR NR FR FR FR FR FR FR Entertainment Entertainment Financial and insurance NR NR FR PR NR NR NR NR sector/repair companies Hotels NR NR FR FR FR PR PR PR Service Beauty salons, SPA NR NR FR FR NR NR FR FR 8 Source: akorda.kz, minfin.gov.kz, hls.kz Worldometer, mass media; Note: – fully restricted, – partially restricted, – not restricted. Extensive fiscal support to smoothen the downturn Low government debt level and substantial fiscal buffers… Kazakhstan external public debt External public debt, 2019, as % of GDP 44.4% 44.3% 40.2% 18.9% 18.2% 13.3% .. provide a room for significant government stimulus Amounts of governments’ support Overview 30 71 13.5 1.1 37 19 50 Total amount of support measures KZT 6.1 tn % of GDP aprx. 10% Financed from budget funds KZT 3.4 tn Financed from non – budget funds(1) KZT 2.7 tn For general anti-epidemiological measurements KZT 125 bn (1) from NBK, National companies, and State Social Insurance Fund. 9 Source: NBK, Central Banks, credit ratings report, mass media. Key macro and sector performance indicators have stabilized Short term economic indicator Industrial production (manufacturing) Crude oil export (cumulative) Electric power (cumulative) 4.4% 4.9% 4.3% 1.2% -0.5% -1.0% -2.7% -2.9% 4.1% 5.8% 5.8% 5.9% 4.8% 3.1% 1.3% 0.4% 5.3% 4.4% 3.4% 7.5% 4.0% 4.3% 4.1% 5.9% 6.2% 13.9% 11.7% 0.5% 8.2% 6.9% 7.8% 2.7% -3.2% -4.0% 2.4% 2.5% 2.0% -6.3% -5.6% -5.6% -2.8% 1.4% -7.2% -9.6% -13.3% 1.0% -11.7% Jan Feb Mar Apr May Jun Jul Aug Jan Feb Mar Apr May Jun Jul Aug Jan Feb Mar Apr May Jun Jul Jan Feb Mar Apr May Jun Jul Aug Indices of the physical volume of commissioned Retail trade Agriculture (gross output) Construction (scope of work performed) residential buildings 4.4% 3.8% 0.8% -11.8% -16.2% -12.6% -11.7% -9.5% 2.6% 2.2% 2.5% 2.2% 2.2% 2.4% 2.5% 4.9% 12.5% 11.9% 11.7% 5.5% 5.9% 11.2% 6.3% 6.5% -31.4% -3.9% -3.6% -10.1% 11.6% 7.3% 7.5% 6.4% 22.5% 4.4% 3.4% 1.6% 2.6% 87.3% -5.5% -7,5% 11.0% 12.5% 11.6% 11.5% 6.9% 8.1% 39.3% 9.1% -30.8% -3.0% 0.0% 2.6% 3.0% 2.3% 3.0% 2.7% -5.3% -10.8% -16.1% -44.7% 1.7% 1.4% -31.4% -35.0% Jan Feb Mar Apr May Jun Jul Aug Jan Feb Mar Apr May Jun Jul Aug Jan Feb Mar Apr May Jun Jul Aug Jan Feb Mar Apr May Jun Jul Aug Railway freight turnover Passenger railway transportation Passenger air transportation Communication -4.2% -0.8% 1.9% 3.4% 3.4% 4.2% 4.4% 4.4% 8.6% 7.1% 1.9% -27.1% -41.8% -44.8% -47.7% 28.1% 26.7% 5.2% -22.7% -34.3% -35.8% -43.1% 9.8% 10.7% 10.5% 9.6% 9.2% 1.6% 1.6% 8.3% 8.6% 5.5% 28.1% 25.1% 7.9% 8.0% 11.6% 7.0% 5.5% 10.2% 2.9% 3.5% 4.5% -32.8% 9.8% -32.8% -41.1% 8.2% -55.5% 7.0% 7.5% 6.9% -4.2% -65.8% 5.9% -74.2% -69.9% -88.4% -97.7% -99.1% Jan Feb Mar Apr May Jun Jul Aug Jan Feb Mar Apr May Jun Jul Jan Feb Mar Apr May Jun Jul Jan Feb Mar Apr May Jun Jul Aug Source: stat.gov.kz, taldau.stat.gov.kz 10 Note: Data are given in % change to the corresponding month of the last year, whereas cumulative data are given YTD; - cumulative data are given YTD Kazakhstan is now much better prepared
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