ANNUAL REPORT 2019 SUCCESS BEYOND NUMBERS MCB Group Limited Annual Report 2019 1 ONLINE INVESTOR CENTRE SCAN ME Help us to protect the environment while also benefiting from easy access to up-to-date information • Register to receive your shareholder communications electronically • Opt-in for email alerts pertaining to earnings releases and corporate events • Access financial reports and presentations This Annual Report is printed on chlorine-free recycled paper produced from 100% recovered fibre. This report has been prepared to assist relevant stakeholders to assess the strategies of MCB Group Limited and their potential of success. The statements contained herein may include declarations of future expectations and other forward-looking statements that are based on our current views and assumptions. Readers are advised not to place undue reliance on forward-looking statements relating to the Group’s business strategy, plans, objectives and financial positions as these statements rely on assumptions and hypotheses which inherently represent an accuracy risk. Actual results, performance and events may differ from those described in such statements due to unexpected changes in the economic, market, industry, political, interest rate and currency market conditions as well as developments in relation to laws and regulations. The MCB Group Limited does not undertake to update any forward-looking statement that may be made from time to time by the organisation or on its behalf. Dear Shareholder, The Directors of MCB Group Limited are pleased to present its Annual Report for the year ended 30 June 2019. The Annual Report was approved by the Board of Directors on 27 September 2019. M G Didier HAREL Pierre Guy NOEL Chairperson Chief Executive Nou konviksion Moris… mo pei… Nou finn resi Ansam nou’nn lev boner, travay, reve, grandi Sikse ekonomik fer nou fier Me Moris mo pei, lev to lizie ! Pran kont ki tou dimounn pena mem sans dan nou sosiete Kan ena dimounn pe plore, planet deregle, fode pa nou get lot kote E !… Finn ler nou dimann nou-mem ki nou konpran kan nou koz sikse Eski nou kapav dir dimounn ere akoz grander zot lakaz ouswa lor grander lamour zot fami ki viv ladan ? Eski enn loto so valer, li depann lor so groser ? Ouswa li dan sa fasilite ki li donn nou al partou kot nou anvi ? Eski enn biznes so rises, li zis dan profi ki li fer ? Ouswa li dan bien-et ki li aporte dan landrwa kot li ete ? Vremem… Finn ariv ler pou nou reaprann mezir ki ete sikse Sikse, se lasante, ledikasion ek travay pou tou dimounn. Se proteksion nou lanvironnman pou nou bann zanfan Se donn enn lame bann biznes, ki li gran, ki li tipti... Sikse, se ki sakenn gagn mem sans dan lavi. Moris, mwa, mo MCB, enn zanfan isi Dan sa kalite sikse-la ki mo pou investi Sikse pou nou lepep, nou lidantite, nou lavenir. Sikse pou Moris mo pei Success Beyond Numbers Our convictions Mauritius … my country … we did it! We rose at dawn, we worked hard, we dreamt and grew. Our economic success has made us proud. But … Mauritius … my country Let’s not turn a blind eye to things anymore. As the world settles into inequality, As we brace ourselves for ecological catastrophe, As hopes and dreams disappear into reality and despair, We must redefine what success means to us. Is the success of a home the price of the property? Or is it in the love it allows a family to share? Does the value of a car live in its size, the make, the model? Or is it in the freedom to choose our own path? Does the wealth of a business lie in its profit margins? Or is it in the well-being it provides? Now is the time to change the equation, to redefine the way we measure success. Success is access to health, education and jobs for all. Success is protecting our environment for future generations. Success is empowering business, big, small, old and new. Success is equality being everyone’s utmost priority. Success is prospering together We are MCB. We believe in Success. Success for this land. Success for all people. Success for tomorrow. MCB Group at a glance Our identity Our reporting suite The contents of this Annual Report are MCB Group Limited (referred to as ‘MCB Group Ltd’or ‘Group’) is the holding complemented by our Sustainability Report. company of MCB Group, which consists of banking and non-banking subsidiaries and For the first time, we are disseminating a dedicated associates. Our main subsidiary, i.e. The Mauritius Commercial Bank Ltd (denoted as report, which provides a comprehensive overview ‘MCB Ltd’, ‘MCB’or ‘Bank’), is the leading bank in Mauritius. Furthermore, the Group of our Corporate Sustainability Programme, is recognised as a prominent financial services player in the region. ‘Success Beyond Numbers’. While shedding light on our value creation model and our socio-economic impact in Mauritius, it showcases key strategies and moves that are aimed at embedding our role as a responsible corporate citizen. The above reports can be accessed at www. mcbgroup.com. They are available in a digital format, which implies that they are fully adapted to Our purpose-driven approach smartphones, tablets and desktop computers. This allows for a more enjoyable reading experience, Over time, the Group has built an organisation which is worthy of the trust of while making it easier to share key information its customers, shareholders and the community at large. We have continuously from the report. The latter can, thus, be strengthened our balance sheet and improved our revenue base, while effectively conveniently broadcast on social media platforms managing the risks and challenges that we have faced within the operating landscape. such as Twitter and LinkedIn as well as on instant messaging services like WhatsApp. Today, we are actively and thoughtfully diversifying our markets in the region and beyond. We are successfully leveraging technology and innovation to make banking For a more comprehensive understanding of simpler, faster and more convenient to our customers, alongside offering them MCB’s strategy, business, performance as well as connected and seamless experiences. In tune with our brand promise and as a approach to corporate governance, our websites responsible entity, we are committed to executing an ambitious sustainability agenda provide a full suite of publications, which cater for in order to embed long-term value for our stakeholders. the diverse needs of our stakeholders. 6 MCB Group Limited Annual Report 2019 Financial highlights Net profit Total assets Rs 9,482 m Rs 471 bn +31.3% +21.9% Financial Jun 19 9,482 471 Jun 18 7,221 386 performance Jun 17 6,702 345 Rs m Rs bn Earnings per share Dividend per share Rs 39.70 Rs 13.00 +31.2% +30.0% Shareholder Jun 19 39.70 13.00 Jun 18 30.26 10.00 value Jun 17 28.10 9.25 Rs Rs Customer loans Customer deposits Rs 235 bn Rs 328 bn +13.9% +11.2% Market Jun 19 235 328 Jun 18 206 295 positioning Jun 17 177 272 Rs bn Rs bn Capital adequacy ratio Return on equity 17.4% 17.6% +27 bps +2.8 pp Capital & Jun 19 17.4 17.6 profitability Jun 18 17.1 14.8 metrics Jun 17 18.8 15.5 % % Cost to income ratio Gross NPL ratio 37.1% Rs 4.1% -3.0 pp -42 bps Efficiency & Jun 19 37.1 4.1 Jun 18 40.1 4.5 asset quality Jun 17 41.2 6.2 % % MCB Group Limited Annual Report 2019 7 Board of Directors Independent Non-Executive Directors Didier HAREL (Chairperson) Sunil BANYMANDHUB Karuna BHOOJEDHUR-OBEEGADOO Jean-Jacques DUPONT DE RIVALZ DE ST ANTOINE Georges Michael David LISING (as from November 2018) Jean-Louis MATTEI Alain REY San T. SINGARAVELLOO (as from November 2018) Non-Executive Directors Navin HOOLOOMANN, C.S.K. (until November 2018) Jean-Pierre MONTOCCHIO (until November 2018) Jean Michel NG TSEUNG Margaret WONG PING LUN Executive Directors Pierre Guy NOEL Gilbert GNANY Secretary to the Board MCB Group Corporate Services Ltd (represented by Marivonne OXENHAM) 8 MCB Group Limited Annual Report 2019 Committees of the Board Risk Monitoring Committee Strategy Committee Jean-Louis MATTEI (Chairperson) Didier HAREL (Chairperson) Jean-Jacques DUPONT DE RIVALZ DE ST ANTOINE Sunil BANYMANDHUB (until January 2019) Jean-Jacques DUPONT DE RIVALZ DE ST ANTOINE Gilbert GNANY Gilbert GNANY (also acts as Secretary) Didier HAREL Jean-Louis MATTEI Georges Michael David LISING (as from January 2019) Pierre Guy NOEL Jean Michel NG TSEUNG (also acts as Secretary) (as from January 2019) Pierre Guy NOEL Remuneration, Corporate Governance Audit Committee and Ethics Committee Alain REY (Chairperson as from March 2019) Didier HAREL (Chairperson) Sunil BANYMANDHUB (Chairperson until March 2019) Karuna BHOOJEDHUR-OBEEGADOO San T. SINGARAVELLOO (as from December 2018) Jean-Jacques DUPONT DE RIVALZ DE ST ANTOINE Margaret WONG PING LUN (until December 2018) (as from November 2018) Secretary: MCB Group Corporate Services Ltd Navin HOOLOOMANN, C.S.K. (until November 2018) (represented by Marivonne OXENHAM) Jean-Pierre MONTOCCHIO (until November 2018) Pierre Guy NOEL Secretary: MCB Group Corporate Services Ltd Supervisory and Monitoring Committee (represented by Marivonne OXENHAM) Didier HAREL (Chairperson) Jean Michel NG TSEUNG (also acts as Secretary) Pierre Guy NOEL MCB Group Limited Annual Report 2019 9 We will seek to uphold the trust that our stakeholders have in our ability to create long-term value for them, alongside building more inclusive and resilient communities … 10 MCB Group Limited Annual Report 2019 Reflections from the Chairman How do you look back on FY has actively and thoughtfully anchored its ur accomplishments indicate that our expansion drive on the basis of its three- Ostrategy is working in an environment 2018/19? pronged strategic orientations, which are to which requires us to be permanently smart, strengthen our domestic position, expand our innovative and disciplined in our approach t has been a particularly eventful and non-bank activities and grow our international and functioning.