banking industry 2012-iv_eng
Post on 03-Apr-2018
219 Views
Preview:
TRANSCRIPT
-
7/29/2019 Banking Industry 2012-IV_ENG
1/14
-
7/29/2019 Banking Industry 2012-IV_ENG
2/14
Banking industry
4th Quarter, 2012
1 | Page
Table of content
Banking Industry.......................................................................................................................................2
Abstract......................................................................................................................................................2
Banking Sector Growth.......................................................................................................................3
Capital Growth .......................................................................................................................................3
Total Asset and Liability Structure .....................................................................................4
Total Deposit and Loan ....................................................................................................................5
Rural Banking Operation..................................................................................................................8
Continued Slowdown of Non-performing Loan.................................................................... 10
Increased Banking Competition ................................................................................................ 13
TABLE OF DIAGRAMS
Diagram 1. Structure of money supply(M2) 3
Diagram 2. Banks total asset and growth 4
Diagram 3. Structure of asset and liability in banking system 5
Diagram 4. Total deposit, its growth and structure 5
Diagram 5. Total loan outstanding and its growth 6
Diagram 6. Loan outstanding by economic sectors 7
Diagram 7. Deposit and loan dynamics of provinces 8Diagram 8. Quarterly deposit and loan outstanding index of provinces 8
Diagram 9. Dependence of deposits and loan of provinces 9
Diagram 10. Loan (quality) classification and volume in total loan 10
Diagram 11. Standard loan term structure 11
Diagram 12. Non-performing loan by economic sectors 12
Diagram 13. Dynamics of interest 13
-
7/29/2019 Banking Industry 2012-IV_ENG
3/14
Banking industry
4th Quarter, 2012
2 | Page
BANKING INDUSTRY
Abstract
The percentage of currency outside banks in money supplydecreases.
Reluctance in the growth of loan disbursed with the term of 5 ormore years in standard loan.
As of 4th quarter, 2012 the loan disbursed in the fields of(i)Education, (ii) Mining, (iii) Transportation and warehouses
peaks amongst total loan.
Higher fluttering on the provincial deposits and loanoutstanding due to seasonality.
Steady growth in the deposit and loan outstanding of South-Gobiand Dornogobi provinces in recent years.
1 Number of Non-bank financial institution 3th quarter, 20122 As of 2011, financial/insurance sectors GDP
Banking Markets, 4th quarter, 2012,
Number of banks/Non-bank financial institutions1 14/205
Financial/insurance sectors GDP (trillion /% of GDP)2 0.29/2.6
Total assets (trillion) 11.99
Total loan (trillion /% of GDP) 6.9/49.8
Total deposit (trillion /% of GDP) 4.4/31.4
Personal loans (trillion /% of GDP) 3.8/27.4
Mortgages (trillion /% of GDP) 0.9/6.6
SME loans (trillion /% of GDP) 1.2/8.5
The volume of non-performing loan in total loan 4.2
Deposit rate/loan rate 11.7/18.2
Number of branches in remote areas 1015
Number of ATMs 711
Number of card holders/active card holders (million) 2.7/1.1
-
7/29/2019 Banking Industry 2012-IV_ENG
4/14
Banking industry
4th Quarter, 2012
3 | Page
Banking Sector Growth
The money supply (M2) structure indicates that currency outside
banks accounted for 39% of total money supply in 1999; it fell down
to 7.9% in 2012. This is one of the indicators for the banking
sector growth in Mongolia.
Diagram 1. Money Supply (M2) Structure
The diagram demonstrates the increase in deposits and decrease in
current account balance in 2012 year over year. This reveals that
banks have better and more sustainable (source of) capital.
Moreover, the volume of foreign currency current accounts and
deposits in money supply increased in 2012.
Capital Growth
As of 4th quarter, 2012, the total asset of commercial banks
reaches MNT 11.99 trillion, up 28% year over year and 92% compared
to 2010 respectively.
Even though the total asset of banking sector has continuously
grown in the recent years, the annual growth rate flutters
frequently due to economic circumstance. Due to the world economic
and financial recession, the annual growth of total asset bottomed
out from 4th quarter, 2008 to 1.8% and 1.4% respectively in the 2nd
and 3d quarters of 2009.
Furthermore, from the 2nd quarter, 2010 the annual asset growth
continuously rose and topped at 55.6% in the 3rd quarter, 2011
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100% Current accoun in FC
Time deposits in FC
Corporation time deposit
in DC
Individuals time deposit inDC
Current account in DC
Currency outside banks
Current account in FCCurrent account in FC
-
7/29/2019 Banking Industry 2012-IV_ENG
5/14
Banking industry
4th Quarter, 2012
4 | Page
since the recession. Though, since then the topped growth of the
annual asset growth gradually declined to 28%, as of 2012.
Diagram 2. Banks Total Asset and Growth
Total Asset and Liability Structure
The total asset and liability structure is shown in diagram-3. As
of 4th quarter, 2012, 58% of the total asset of banking system is
comprised of the individuals and corporate debts while 17% as banks
reserves, 6% as Central Bank bills and 6% as foreign assetrespectively.
In contrast, of the total liabilities, deposit and current accounts
in foreign currency comprise 53% while local currency current
accounts as 18%, foreign liabilities as 12%, Government deposit as
8% and financial derivatives as 5% respectively as of 4th
quarter,2012.
9,371.63
11,992.23
0.28
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
-
2,000.00
4,000.00
6,000.00
8,000.00
10,000.00
12,000.00
14,000.00
I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV
2006 2007 2008 2009 2010 2011 2012
Total asset, billion yearly growth of total asset
-
7/29/2019 Banking Industry 2012-IV_ENG
6/14
Banking industry
4th Quarter, 2012
5 | Page
Diagram-3. Asset and Liability Structure of Banking Sector
Total Deposit and Loan
The total deposit tends to grow; however, the annual growth rate
goes down from the 2nd quarter, 2011.
As of 4th quarter, 2012 the commercial banks deposits reach MNT
3.09 trillion, up 17% year over year.
Of the total deposit, demand deposits comprise 29% while the rest
of 71% by time deposits. While the deposit in domestic currency
reached 76% in the 4
th
quarter, 2011, it slightly goes down to 70%as of 4th quarter, 2012.
Diagram 3. Total Deposit, Growth and Structure
13% 6%
6%
58%
17%
Decomposition of assets,
2012Q4
Bank reserves
Central bank bills
Foreign assets
Claims on individuals
and nonfinancial
corporationOther asset
18%
53%
12%
8%
5% 4%
Decompostion of liabilities,
2012Q4
Current account in
DCTotal deposits and
current account in FCForeign liabilities
Government deposits
Financial derivativies
Other liabilities
-0.20
-0.10
-
0.10
0.20
0.30
0.40
0.50
0.60
0.70
0.80
-
1,000.00
2,000.00
3,000.00
4,000.00
5,000.00
I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV I II IIIIV
2005 2006 2007 2008 2009 2010 2011 2012
Time depositsDemand depositsDeposits, billion Growth of deposits, right axis
-
7/29/2019 Banking Industry 2012-IV_ENG
7/14
Banking industry
4th Quarter, 2012
6 | Page
As of 4th quarter, 2012, the total loan comprises 58% of total
asset. The total loan outstanding rises continuously, however its
speed slows down from 4th quarter, 2011.
As of 4th quarter, 2012, the total loan outstanding of commercial
banks of Mongolia increased to MNT 6.9trillion, up by 24% year over
year.
While the average growth rate of total loan outstanding for the
past one year was 38%, the monthly growth rate for April, 2012 was
24%.
Diagram 4. Total Debt Outstanding and Growth
The diagram-6 shows the total loan outstanding classified by
economic sectors. As of 4th quarter, 2012, the volume of loan
outstanding for whole sale and retail trade sector comprise the 16%
or tops than other sectors. In addition, the real estate, mining,
construction and processing industries are the major sectors that
account for over 10% of total loan outstanding.
There is an increase on the loan growth for those sectors
accounting for the larger volume of the total loan outstanding.Agriculture, the major sector of the economy of Mongolia accounts
for 2.5% of total loan outstanding.
-0.10
-
0.10
0.20
0.30
0.40
0.50
0.60
0.700.80
-
1,000.00
2,000.00
3,000.00
4,000.00
5,000.00
6,000.00
7,000.008,000.00
I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV
2006 2007 2008 2009 2010 2011 2012
Loan outstanding, billion Yearly growth, right axis
-
7/29/2019 Banking Industry 2012-IV_ENG
8/14
Banking industry
4th Quarter, 2012
7 | Page
Diagram-6. Loan Outstanding by Economic Sector
From the diagram above, we can see as well the dropping trend of
2012 for the sectors such as finance, insurance, education, power
industry which account for small percent of total outstanding.
-300.00 700.00 1,700.00
Other
Professional, scientific and
Water supply; sewerage, waste
Electricity, gas, sream and air
Education
Information and communicationHuman health and social work
Financial and insurance activites
ccommodation and food service
Agriculture, forestry and fishing
Transportation and storage
Manufacturing
Mining and quarrying
Construction
Real estate activities
hole sale and retail trade; repair
2010-IV
2011-IV
2012-IV
-
7/29/2019 Banking Industry 2012-IV_ENG
9/14
Banking industry
4th Quarter, 2012
8 | Page
Rural Banking Operation
In general, the deposit and loan outstanding of provinces tend to
grow. As of 4th quarter, 2012, the total deposits of provinces
reach MNT786.3 billion or account for 18% of total deposits and the
total loan outstanding reaches MNT 1,540 billion or account for 22%
of total loan.
Diagram5. Deposit and Loan Dynamics of Provinces
Higher fluttering is felt on the provincial deposits and loan
outstanding due to seasonality. This is largely due to the seasonal
changes depending on which the
revenue and expenditure of
rural people of the country
change.
The trend is observed that
deposit balance of provinces
exceeds by MNT13.3 billion in
the 2nd quarter annually while
the loan outstanding declinesby MNT 12.4 billion.
The April, May and June are the
period of major source of
income for herders from the
cashmere.
0%
5%
10%
15%
20%
25%
-
100.0
200.0
300.0
400.0
500.0
600.0
700.0
800.0
I III I III I III I III I III I III
2007 2008 2009 2010 2011 2012
Local deposits
Rate of local deposits in total
deposits
0%
5%
10%
15%
20%
25%
30%
-
200.0
400.0
600.0
800.0
1,000.0
1,200.0
1,400.0
1,600.0
I III I III I III I III I III I III
2007 2008 2009 2010 2011 2012
Local loan
Rate of local loan in total loan
-15
-10
-5
0
5
10
15
20
25
1 2 3 4MNTBillio
n
Figure 6. Seasonal index of local
deposits and loan
Seasonal index of local deposits
Seasonal index of local loan
-
7/29/2019 Banking Industry 2012-IV_ENG
10/14
Banking industry
4th Quarter, 2012
9 | Page
In contrast, deposit balance of provinces soars by MNT9.9 billion
in the 3d quarter while the loan outstanding increases by MNT22.2
billion.
This is majorly due to the period when rural people tend to afford
for the tuition fee and educational costs of students for the city-
the largest ever expenditure for them.
Moreover, the deposit balance of province goes up in the 4th
quarter while the loan outstanding goes down.
As of 4th quarter, 2012, the provinces including Orhon, Darkhan-Uul
and South-Gobi etc topped with their deposit balance. Orhon,
Darkhan-Uul and Selenge provinces rank with their highest loan
outstanding.
In recent years, the intensive increase is felt in the deposit
balance and loan outstanding of South-Gobi and Dornogobi provinces.
Diagram-9. Dependence of Provincial Deposit and Loan
Gobi sumber
Umnugobi
Dornogobi
Selenge
Darhan-Uul
Orhon
-
30,000.0
60,000.0
90,000.0
120,000.0
- 20,000.0 40,000.0 60,000.0 80,000.0 100,000.0 120,000.0 140,000.0 160,000.0
Deposi
ts,
billion
Loan outstanding, billion
Correlation of local deposit and loan
Linear (Correlation of local deposit and loan)
-
7/29/2019 Banking Industry 2012-IV_ENG
11/14
Banking industry
4th Quarter, 2012
10 | Page
Continued Slowdown of Non-performing Loan
Diagram-10 demonstrates the dynamics of the loan (quality)
classification in banking sector since 2000.
Diagram-7. Loan Classification and Volume in Total Loan
In early quarter of 2000, the non-performing loan topped or
accounted for 30% of total loan. Since then due to the constant
decline, it leveled off from the 4th quarter, 2001 until the 3rd
quarter, 2008.
However, due to the financial recession started in 2008, the non-
performing loan portfolio of the banking system soared from the 4th
quarter, 2008 and peaked in 4th quarter, 2009 or reached 17% of
total loan.
The volume of non-performing loan in total loan declined to 6% in
2011, since then it tends to stabilize.
As of 4th quarter, 2012, the non-performing loan portfolio comprises
4% of total loan while 70% of total non-performing loan are
referred as bad loans.
-
7/29/2019 Banking Industry 2012-IV_ENG
12/14
Banking industry
4th Quarter, 2012
11 | Page
Diagram 8. Standard Loan Term Structure
The dynamics of standard loan term structure is shown on diagram -
11.
Until 2004, 90 percent of total standard loan was comprised of
short term loan /for the term up to 1 year/. However, starting from
2004, the volume of total standard loan with the term of up to 1-5
years increased constantly reaching 58% in the 4th quarter, 2012.
Since 2007, the standard loan with the term of over 5 years went up
accounting 22% of total standard loan in the 3d quarter, 2010.
However, since then no increase ever observed in the volume ofstandard loan with the term of over 5 years.
Only in the past year, the volume of standard loan with the term of
up to 1 year tends to go up.
-
7/29/2019 Banking Industry 2012-IV_ENG
13/14
Banking industry
4th Quarter, 2012
12 | Page
The diagram 12 indicates the volume of non-performing loan with its
respective percentage in the target sectors as of 4th quarters of
the past 3 years.
Diagram 9. Non-performing Loan by Economic Sectors
From the diagram, the sectors including (i) Education, (ii) Mining,
(iii) Transportation and warehouse top with their volume in total
loan as of 4th quarter, 2012.
- 0.10 0.20 0.30
Other
Human health and social
Adminisrative and
Real estate
accommodation and food
Informationa
Manufacturing
Professional, scientific
Wholesale and retail
Agriculture, forestry and
Construction
Financial and insurance
Electricity, gas, steam and
Water supply, sewerage,
Transportation and storage
Mining and quarrying
Education
2010-IV
2011-IV
2012-IV
-
7/29/2019 Banking Industry 2012-IV_ENG
14/14
Banking industry
4th Quarter, 2012
13 | Page
Increased Banking Competition
The diagram-13 illustrates the dynamics of weighted average rate
and spread of deposit and loan. In 2nd quarter, 2012 the spread
decreased from 7.6 unit increase to 6.5 unit increase in December,
2012.
The decline in spread reveals the increased competition of
commercial banks and improved market circumstance.
Diagram 10. Interest Dynamics
MONGOLIAN BANKERS ASSOCIATION
0
2
4
6
8
10
12
14
16
18
20
8
13
18
23
28
IIII
VVII
IX XI I
III
VVII
IXXI I
III
VVII
IX XI I
III
VVII
IXXI
2009 2010 2011 2012
,
Weighted average rate of loan
Weighted average rate of deposit
Spread
top related