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Annual Report 2020 Corporate Financials Additional Information

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Annual Report 2020 Corporate Financials Additional Information Annual Report 2020 Corporate Financials Additional Information 02 Introduction 78 Directors’ Report 286 Notice of Annual General Meeting 03 Five Year Group Financial 88 Statements of Financial Position Highlights 290 Statement Accompanying Notice 90 Statements of Income of Annual General Meeting 05 Simplified Group Statements of 91 Statements of Comprehensive Financial Position 291 Other Information Income 06 Group Quarterly Financial • Form of Proxy 92 Statements of Changes in Equity Performance 97 Statements of Cash Flows 07 Segmental Information 105 Summary of Significant 08 Hong Leong Financial Group Accounting Policies Share Price 140 Notes to the Financial 09 Financial Calendar Statements 10 Corporate Milestones 279 Statement by Directors 12 Awards & Accolades 279 Statutory Declaration 15 Chairman’s Statement 280 Independent Auditors’ Report Scan the QR Code by following these simple steps: 19 Management Discussion & Analysis 28 Sustainability Statement 55 Corporate Information Get it Download the “QR Code Reader” app from 56 Board of Directors’ Profile Google Play (Android Market), BlackBerry AppWorld, App Store (iOS/iPhone) or Windows 59 Key Senior Management Phone Store of the Group 61 Board Audit and Risk Run it Run the QR Code Reader app and point your Management Committee Report camera at the QR Code 64 Corporate Governance Overview, Risk Management & Internal Access it Get access to Hong Leong Financial Group’s Control Statement website CORPORATE FINANCIALS ADDITIONAL INFORMATION To be an integrated financial services group that consistently meets our customers’ needs Annual Report 2020 1 Introduction Hong Leong Financial Group Berhad offers an integrated suite of conventional and Islamic financial products and services which enables us to reach out and connect with customers not only in Malaysia, but throughout the region. Commercial and Islamic Investment Banking Insurance and Takaful Banking • Personal Financial Services • Investment Banking • Life Insurance • Business & Corporate Banking • Stockbroking • Family Takaful • Global Markets • Asset Management • Islamic Banking Core Values Quality Progress Entrepreneurship Social Responsibility Innovation Human Resource Honour Unity 2 HONG LEONG FINANCIAL GROUP BERHAD CORPORATE FINANCIALS ADDITIONAL INFORMATION Five Year Group Financial Highlights Group Total Assets Group Profit Attributable to Owners Group Profit before Tax (RM’Million) of the Parent (RM’Million) (RM’Million) 253,603 1,919 1,907 1,858 237,883 3,579 229,318 3,506 3,300 218,962 210,475 3,090 1,507 1,359 2,565 FY2016 FY2017 FY2018 FY2019 FY2020 FY2016 FY2017 FY2018 FY2019 FY2020 FY2016 FY2017 FY2018 FY2019 FY2020 +6.6% YoY -3.2% YoY -5.9% YoY 4.6% CAGR 2.8% CAGR 1.8% CAGR FY2016 FY2017 FY2018 FY2019 FY2020 The Group RM’Million RM’Million RM’Million RM’Million RM’Million Statements of Financial Position Total assets 210,475 218,962 229,318 237,883 253,603 Net loans 120,445 124,812 128,851 137,058 145,521 Total liabilities 187,297 193,930 202,638 209,282 222,550 Deposits from customers 149,491 154,458 156,883 161,888 171,237 Shareholders' funds 15,341 16,609 17,804 19,097 20,898 Commitments and contingencies 159,473 171,332 177,098 174,186 154,879 Statements of Income Revenue 4,543 5,035 5,351 5,278 5,258 Profit before tax 2,565 3,090 3,579 3,506 3,300 Net profit 2,064 2,317 2,895 2,914 2,779 Profit attributable to owners of the parent 1,359 1,507 1,907 1,919 1,858 Annual Report 2020 3 Five Year Group Financial Highlights Group Basic Earnings per Share Group Return on Equity Group Book Value per Share (sen) (%) (RM) 18.43 163.6 166.8 167.8 16.78 15.55 11.1 10.4 14.52 13.42 131.8 9.6 9.3 123.2 9.4 FY2016 FY2017 FY2018 FY2019 FY2020 FY2016 FY2017 FY2018 FY2019 FY2020 FY2016 FY2017 FY2018 FY2019 FY2020 -2.5% YoY -1.1% YoY +9.8% YoY 8.1% CAGR The Group FY2016 FY2017 FY2018 FY2019 FY2020 Key Performance Indicators Share price (RM) 14.68 16.80 18.00 18.54 13.10 Book value per share (RM) 13.42 14.52 15.55 16.78 18.43 Basic earnings per share (sen) 123.2 131.8 166.8 167.8 163.6 Net dividend per share (sen) 38.0 38.0 40.0 42.0 38.0 Financial Ratios (%) Profitability Ratios Return on equity 9.6% 9.4% 11.1% 10.4% 9.3% Return on average assets 0.7% 0.7% 0.9% 0.8% 0.8% Cost/income ratio 50.3% 44.1% 42.9% 45.1% 44.9% Asset Quality/Loan Ratios Gross loans to deposits ratio 81.3% 81.6% 82.8% 85.4% 85.7% Gross impaired loans ratio 0.8% 1.0% 0.9% 0.8% 0.6% 4 HONG LEONG FINANCIAL GROUP BERHAD CORPORATE FINANCIALS ADDITIONAL INFORMATION Simplified Group Statements of Financial Position 57.4% Loans, advances and financing 57.6% 4.4% Cash and short-term funds 3.6% 28.9% Portfolio of securities 27.4% Assets Assets 2020 2019 3.6% Deposits and placements with banks 4.2% and other FI 0.2% Statutory deposits with Central Banks 2.0% 5.5% Other assets (including goodwill) 5.2% 67. 5% Deposits from customers 68.1% 3.4% Deposits and placements of banks 4.1% and other FI 1.2% Obligations on securities sold under 1.0% repurchase agreements 1.2% Borrowings and subordinated 1.5% obligations Liabilities & Equity 0.3% Additional Tier 1 and Innovative 0.5% Liabilities & Equity 2020 Tier 1 capital securities 2019 6.5% Insurance funds 6.3% 7.7% Other liabilities 6.4% 0.9% Share capital 1.0% 7. 3% Reserves (net of treasury shares for ESOS) 7.1% 4.0% Non-controlling interests 4.0% Annual Report 2020 5 Group Quarterly Financial Performance 2020 RM’Million Q1 Q2 Q3 Q4 Year Statements of Income Revenue 1,326 1,360 1,142 1,429 5,258 Profit before tax 914 924 603 858 3,300 Net Profit 743 757 513 765 2,779 Profit attributable to owners of the parent 490 503 339 525 1,858 Key Performance Indicators Share price (RM) 16.3 16.9 13.7 13.1 13.1 Book Value per Share (RM) 17.1 17.4 17.8 18.4 18.4 Basic earnings per share (sen) 43.1 44.3 29.9 46.3 163.6 Dividend per share (sen) - 13.0 - 25.0 38.0 2019 RM’Million Q1 Q2 Q3 Q4 Year Statements of Income Revenue 1,383 1,245 1,308 1,342 5,278 Profit before tax 929 878 859 840 3,506 Net Profit 769 732 702 711 2,914 Profit attributable to owners of the parent 505 482 463 469 1,919 Key Performance Indicators Share price (RM) 19.3 18.6 19.2 18.5 18.5 Book Value per Share (RM) 15.9 16.2 16.7 16.8 16.8 Basic earnings per share (sen) 44.2 42.1 40.5 41.0 167.8 Dividend per share (sen) - 13.0 - 29.0 42.0 6 HONG LEONG FINANCIAL GROUP BERHAD CORPORATE FINANCIALS ADDITIONAL INFORMATION Segmental Information Operating Revenue a By Business Segment a 90.9% 89.5% A b b c 8.0% c 5.6% 4.4% d 3.8% d -0.9% -1.3% FY2020 FY2019 Profit Before Tax a a By Business Segment 90.6% 90.9% b b 9.4% 7.8% c c 2.9% d 2.2% d -1.3% -2.5% FY2020 FY2019 a Commercial Banking b Insurance c Investment Banking d Other Operations/Consolidation Adj Annual Report 2020 7 Hong Leong Financial Group Share Price Dividend per Share Share Price Market Capitalisation FY2020 38.0 sen -9.5% YoY FY2020 RM13.10 -29.3% YoY FY2020 RM15.0 bil -29.6% YoY FY2019 42.0 sen FY2019 RM18.54 FY2019 RM21.3 bil Earning per Share Total Shareholder Return FY2020 163.6 sen -2.5% YoY FY2020 9.3% -1.1% YoY FY2019 167.8 sen FY2019 10.4% % Hong Leong Financial Group Share Price Vs Benchmark FBMKLCI 40 20 0 -20 -40 Jun ‘15 Dec ‘15 Jun ‘16 Dec ‘16 Jun ‘17 Dec ‘17 Jun ‘18 Dec ‘18 Jun ‘19 Dec ‘19 Jun ‘20 HLFG FBMKLCI Share Price (RM) Hong Leong Financial Group Share Price & Volume Volume 20 4.0M 3.5M 15 3.0M 2.5M 10 2.0M 1.5M 5 1.0M 0.5M 0 0M Jun ‘15 Dec ‘15 Jun ‘16 Dec ‘16 Jun ‘17 Dec ‘17 Jun ‘18 Dec ‘18 Jun ‘19 Dec ‘19 Jun ‘20 Share Price Volume 8 HONG LEONG FINANCIAL GROUP BERHAD CORPORATE FINANCIALS ADDITIONAL INFORMATION Financial Calendar Annual General 30 October 2020 (Friday) Meeting 51st Annual General Meeting DIVIDENDS Interim Single-Tier Dividend of 13 sen per share Announcement Entitlement Payment 27 November 2019 12 December 2019 27 December 2019 Final Single-Tier Dividend of 25 sen per share Announcement Entitlement Payment 28 August 2020 6 November 2020 25 November 2020 ANNOUNCEMENT OF CONSOLIDATED RESULTS 27 November 2019 29 May 2020 Wednesday Friday unaudited results for unaudited results for 1st quarter ended 3rd quarter ended 30 September 2019 31 March 2020 26 February 2020 28 August 2020 Wednesday Friday unaudited results for unaudited results for 2nd quarter ended 4th quarter and financial year ended 31 December 2019 30 June 2020 Annual Report 2020 9 Corporate Milestones JULY OCTOBER APRIL JULY 2006 2007 2008 2008 Changed name to HLIB proposed to acquire HLA proposed to acquire PJ HLB acquired 20% equity ‘Hong Leong Financial the identified assets and City premises interest in the Bank of Group Bhd’ liabilities of Southern Chengdu (BOCD) Investment Bank Bhd OCTOBER FEBRUARY JANUARY OCTOBER 2009 2009 2009 2008 HLCB 1:1 Rights Issue Insurance holding • HLIB obtained investment HLIB acquired SBB completed company, HLAH, was bank status Securities Sdn Bhd incorporated • HLB granted Vietnam banking license FEBRUARY OCTOBER MAY SEPTEMBER 2010 2010 2011 2012 Sichuan Jincheng consumer MSIG Strategic Partnership HLB acquired EON Capital Merger of HLIB & MIMB finance JV incorporated completed Bhd’s assets and liabilities Investment Bank completed 10 HONG LEONG FINANCIAL GROUP BERHAD CORPORATE FINANCIALS ADDITIONAL INFORMATION Corporate Milestones JANUARY JULY NOVEMBER 2018 2018 2019 BOCD was listed on the Shanghai HLMT converted its composite HLISAM (formerly known as Hong Stock Exchange.
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