Vietnam commercial banking report q3 2011

13 Table: Asia Commercial Banking Business Environment Ratings .... 24 Table: Asia Commercial Banking Business Environment Ratings .... Business Environment Outlook Commercial Banking Bu

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© 2011 Business Monitor International

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BANKING REPORT Q3 2011

INCLUDING INDUSTRY FORECASTS TO 2015

Part of BMI’s Industry Report & Forecasts Series

Published by: Business Monitor International

Copy deadline: June 2011

Business Monitor International

© 2011 Business Monitor International

All rights reserved

All information contained in this publication is copyrighted in the name of Business Monitor International, and as such no part of this publication may be reproduced, repackaged, redistributed, resold in whole or in any part, or used in any form or by any means graphic, electronic or mechanical, including photocopying, recording, taping, or by information storage or retrieval, or by any other means, without the express written consent of the publisher

DISCLAIMER

All information contained in this publication has been researched and compiled from sources believed to be accurate and reliable at the time of

BANKING REPORT Q3 2011

INCLUDING INDUSTRY FORECASTS TO 2015

Part of BMI’s Industry Report & Forecasts Series

Published by: Business Monitor International

Copy deadline: June 2011

CONTENTS

Executive Summary 5

Table: Levels (VNDbn) 5

Table: Levels (US$bn) 5

Table: Levels At August 2010 5

Table: Annual Growth Rate Projections 2011-2015 (%) 6

Table: Ranking Out Of 59 Countries Reviewed In 2011 6

Table: Projected Levels (VNDbn) 6

Table: Projected Levels (US$bn) 7

SWOT Analysis 8

Vietnam Commercial Banking SWOT 8

Vietnam Political SWOT 9

Vietnam Economic SWOT 10

Vietnam Business Environment SWOT 11

Business Environment Outlook 12

Commercial Banking Business Environment Rating 12

Table: Commercial Banking Business Environment Ratings 12

Commercial Banking Business Environment Rating Methodology 13

Table: Asia Commercial Banking Business Environment Ratings 14

Global Commercial Banking Outlook 15

Asia Banking Sector Outlook 19

Table: Banks’ Bond Portfolios 24

Table: Asia Commercial Banking Business Environment Ratings 25

Table: Comparison Of Loan/Deposit, Loan/Asset And Loan/GDP Ratios 26

Table: Anticipated Developments In 2011 27

Table: Comparison Of Total Assets, Client Loans And Client Deposits , 2009-2010(US$bn) 28

Table: Comparison Of Per Capita Deposits, 2010 (US$) 29

Table: Interbank Rates And Bond Yields 30

Vietnam Banking Sector Outlook 31

Economic Outlook 34

Table: Vietnam Economic Activity, 2008-2015 36

Company Profiles 37

Vietcombank 37

Table: Key Statistics For Vietcombank, 2004-2008 (VNDmn) 38

BIDV 39

Table: Key Statistics For BIDV, 2004-2006 (VNDmn) 40

VietinBank 41

Table: Key Statistics For VietinBank, 2005-2008 (VNDmn) 42

Agribank 43

Table: Balance Sheet (VNDmn, unless stated) 44

Table: Balance Sheet (US$mn, unless stated) 44

Table: Key Statistics For MHB Bank, 2006-2008 (VNDmn) 46

Habubank 47

Table: Key Statistics For Habubank, 2004-2007 (VNDmn) 48

Eximbank 49

Table: Balance Sheet (VNDmn, unless stated) 50

Table: Balance Sheet (US$mn, unless stated) 50

Table: Key Ratios (%) 50

Sacombank 51

Table: Stock Market Indicators 52

Table: Balance Sheet (VNDmn, unless stated) 52

Table: Balance Sheet (US$mn, unless stated) 53

Table: Key Ratios (%) 53

Saigonbank 54

Table: Stock Market Indicators 54

Table: Balance Sheet (VNDmn, unless stated) 55

Table: Balance Sheet (US$mn, unless stated) 55

Table: Key Ratios (%) 55

SeABank 56

Table: Balance Sheet (VNDmn, unless stated) 56

Table: Balance Sheet (US$mn, unless stated) 57

Table: Key Ratios (%) 57

BMI Banking Sector Methodology 58

Commercial Bank Business Environment Rating 59

Table: Commercial Banking Business Environment Indicators And Rationale 60

Table: Weighting Of Indicators 61

Executive Summary

Table: Levels (VNDbn)

Date

Total assets

Client loans

Bond portfolio Other

Liabilities and capital Capital

Client deposits Other

August

2009 2,065,761.6 1,706,340.0 173,358.3 186,063.3 2,065,761.6 286,547.0 1,594,992.6 184,222.0August

2010 2,624,434.1 2,191,880.0 203,131.1 229,423.0 2,624,434.1 360,566.0 2,038,758.6 225,109.5Change,

Source: BMI, Central banks, Regulators

Table: Levels (US$bn)

Date

Total assets

Client loans

Bond portfolio Other

Liabilities and capital Capital

Client deposits Other

August 2009 115.9 95.7 9.7 10.4 115.9 16.1 89.5 10.3August 2010 134.7 112.5 10.4 11.8 134.7 18.5 104.6 11.5

Source: BMI, Central banks, Regulators

Table: Levels At August 2010

Loan/deposit ratio Loan/asset ratio Loan/GDP ratio

GDP Per Capita,

US$

Deposits per capita, US$

Source: BMI, Central banks, Regulators

Table: Annual Growth Rate Projections 2011-2015 (%)

Source: BMI, Central banks, Regulators

Table: Ranking Out Of 59 Countries Reviewed In 2011

Local currency asset growth Local currency loan growth Local currency deposit growth

Source: BMI, Central banks, Regulators

Table: Projected Levels (VNDbn)

Table: Projected Levels (US$bn)

2007 2008 2009 2010 2011f 2012f 2013f 2014f 2015f

Total assets 88.05 99.94 130.56 148.40 168.15 201.78 248.76 307.70 378.96

Client loans 66.66 76.60 100.07 113.75 128.88 154.66 190.67 235.84 290.45Client deposits 68.70 76.71 82.78 87.04 92.87 105.87 123.99 145.70 171.97

f = forecast Source: BMI, Central banks, Regulators

SWOT Analysis

Vietnam Commercial Banking SWOT

Strengths ƒ Rapid growth

ƒ Untapped potential

ƒ High savings rate of Vietnamese

ƒ Increasingly open to foreign banks since WTO accession in 2007

ƒ Role of state-owned banks steadily decreasing

Weaknesses ƒ Domestic banks lack capital and technology to sustain high credit growth

ƒ The financial accounts of many banks are still opaque

ƒ High exposure to real estate and stock market loans among smaller banks

Opportunities ƒ Population still under-banked

ƒ Income levels likely to rise strongly over the medium term

Threats ƒ Macroeconomic instabilities threaten the credibility of the government and could

potentially turn economic policy away from further liberalisation

Vietnam Political SWOT

Strengths ƒ The Communist Party of Vietnam remains committed to market-oriented reforms

and we do not expect major shifts in policy direction over the next five years The one-party system is generally conducive to short-term political stability

ƒ Relations with the US have witnessed a marked improvement, and Washington sees Hanoi as a potential geopolitical ally in South East Asia

Weaknesses ƒ Corruption among government officials poses a major threat to the legitimacy of

the ruling Communist Party

ƒ There is increasing (albeit still limited) public dissatisfaction with the leadership's tight control over political dissent

Opportunities ƒ The government recognises the threat that corruption poses to its legitimacy, and

has acted to clamp down on graft among party officials

ƒ Vietnam has allowed legislators to become more vocal in criticising government policies This is opening up opportunities for more checks and balances within the one-party system

Threats ƒ Macroeconomic instabilities in 2010 and 2011 are likely to weigh on public

acceptance of the one-party system, and street demonstrations to protest economic conditions could develop into a full-on challenge of undemocractic rule

ƒ Although strong domestic control will ensure little change to Vietnam's political scene in the next few years, over the longer term, the one-party-state will probably

be unsustainable

ƒ Relations with China have deteriorated over recent years due to Beijing's more assertive stance over disputed islands in the South China Sea and domestic criticism of a large Chinese investment into a bauxite mining project in the central highlands, which could potentially cause significant environmental damage

Vietnam Economic SWOT

Strengths ƒ Vietnam has been one of the fastest-growing economies in Asia in recent years,

with GDP growth averaging 7.2% annually between 2000 and 2010

ƒ The economic boom has lifted many Vietnamese out of poverty, with the official poverty rate in the country falling from 58% in 1993 to 20% in 2004

Weaknesses ƒ Vietnam still suffers from substantial trade, current account and fiscal deficits,

leaving the economy vulnerable to global economic uncertainties in 2011 The fiscal deficit is dominated by substantial spending on social subsidies that could be difficult to withdraw

ƒ The heavily-managed and weak dong currency reduces incentives to improve quality of exports, and also serves to keep import costs high, thus contributing to inflationary pressures

Opportunities ƒ WTO membership has given Vietnam access to both foreign markets and capital,

while making Vietnamese enterprises stronger through increased competition

ƒ The government will in spite of the current macroeconomic woes, continue to move forward with market reforms, including privatisation of state-owned enterprises, and liberalising the banking sector

ƒ Urbanisation will continue to be a long-term growth driver The UN forecasts the urban population to rise from 29% of the population to more than 50% by the early 2040s

Threats ƒ Inflation and deficit concerns have caused some investors to re-assess their

hitherto upbeat view of Vietnam If the government focuses too much on stimulating growth and fails to root out inflationary pressure, it risks prolonging macroeconomic instability, which could lead to a potential crisis

ƒ Prolonged macroeconomic instability could prompt the authorities to put reforms

on hold, as they struggle to stabilise the economy

Vietnam Business Environment SWOT

Strengths ƒ Vietnam has a large, skilled and low-cost workforce that has made the country

attractive to foreign investors

ƒ Vietnam's location - its proximity to China and South East Asia, and its good sea links - makes it a good base for foreign companies to export to the rest of Asia, and beyond

Weaknesses ƒ Vietnam's infrastructure is still weak Roads, railways and ports are inadequate to

cope with the country's economic growth and links with the outside world

ƒ Vietnam remains one of the world's most corrupt countries Its score in Transparency International's 2010 Corruption Perceptions Index was 2.7, placing it

in 22nd place in the Asia-Pacific region

Opportunities ƒ Vietnam is increasingly attracting investment from key Asian economies, such as

Japan, South Korea and Taiwan This offers the possibility of the transfer of tech skills and knowhow

high-ƒ Vietnam is pressing ahead with the privatisation of state-owned enterprises and the liberalisation of the banking sector This should offer foreign investors new entry points

Threats ƒ Ongoing trade disputes with the US, and the general threat of American

protectionism, which will remain a concern

ƒ Labour unrest remains a lingering threat A failure by the authorities to boost skills levels could leave Vietnam a second-rate economy for an indefinite period

Business Environment Outlook

Commercial Banking Business Environment Rating

Table: Commercial Banking Business Environment Ratings

Limits of potential returns Data Score; out of 10 Ratings score; out of 100

Total assets; end 2010 US$148.4mn 6 Market Structure 67

Growth in total assets; 2011-2015 7

Growth in client loans; 2011-2015 7

Per-capita GDP; 2011 US$1,265.3 2 Country Structure 53

Risks to realisation of returns

Regulatory framework and

Regulatory framework and

Moody's rating for local currency

Long-term financial risk 4.8 5 Country Risk 46

Source: BMI

Commercial Banking Business Environment Rating Methodology

Since Q108, we have described numerically the banking business environment for each of the countries

surveyed by BMI We do this through our Commercial Banking Business Environment Rating (CBBER),

a measure that ensures we capture the latest quantitative information available It also ensures consistency across all countries and between the inputs to the CBBER and the Insurance Business Environment Rating, which is likewise now a feature of our insurance reports Like the Business Environment Ratings

calculated by BMI for all the other industries on which it reports, the CBBER takes into account the

limits of potential returns and the risks to the realisation of those returns It is weighted 70% to the former and 30% to the latter

The evaluation of the 'Limits of potential returns' includes market elements that are specific to the

banking industry of the country in question and elements that relate to that country in general Within the 70% of the CBBER that takes into account the 'Limits of potential returns', the market elements have a 60% weighting and the country elements have a 40% weighting The evaluation of the 'Risks to

realisation of returns' also includes banking elements and country elements (specifically, BMI's

assessment of long-term country risk) However, within the 30% of the CBBER that takes into account the risks, these elements are weighted 40% and 60% respectively

Further details on how we calculate the CBBER are provided at the end of this report In general, though, three aspects need to be borne in mind in interpreting the CBBERs The first is that the market elements

of the 'Limits of potential returns' are by far the most heavily weighted of the four elements They account for 60% of 70% (or 42%) of the overall CBBER Second, if the market elements are significantly higher than the country elements of the 'Limits of potential returns', it usually implies that the banking sector is (very) large and/or developed relative to the general wealth, stability and financial infrastructure in the country Conversely, if the market elements are significantly lower than the country elements, it usually means that the banking sector is small and/or underdeveloped relative to the general wealth, stability and financial infrastructure in the country Third, within the 'Risks to the realisation of returns' category, the market elements (ie: how regulations affect the development of the sector, how regulations affect

competition within it, and Moody's Investor Services' ratings for local currency deposits) can be

markedly different from BMI's long-term risk rating

Table: Asia Commercial Banking Business Environment Ratings

Limits of Potential Returns

Risks to Potential

Market Structure Structure Country Market Risks Country Risks Rating Ranking

Global Commercial Banking Outlook

Outlook Continues To Improve With Risks

In line with generally improving world macroeconomic conditions, the outlook for the global banking sector continues to solidify Although we are mindful of risks from rising oil prices and inflation, unrest

in the Middle East and North Africa (MENA) and reverberations from the global supply chain emanating from Japan’s earthquake and tsunami, our global outlook remains generally upbeat This backdrop should provide a sufficient foundation for continued loan and asset growth This is particularly the case for

emerging markets and developed states that did not experience banking sector crises in 2007-2009 Major

potential headwinds include global monetary tightening, which will be concentrated in emerging markets

Lending Growth Depends On Macro

US – Real GDP Growth And Bank Lending

Source: BMI, Federal Reserve

US and eurozone: The US macro outlook suggests mixed prospects for its commercial banks Bank

lending tends to expand alongside economic growth and in this respect, with decent but not particularly strong economic expansion forecast for the foreseeable future, banking sector loan growth will be slow for some time Importantly, we continue to believe that in the current climate of household deleveraging, there will be subdued demand for credit 2011 and 2012 are set to be slow growth years for the

eurozone’s banking sector as the effects of fiscal austerity are felt across the currency bloc and banks

remain hesitant to significantly ramp up lending towards the levels experienced prior to the global

financial crisis, particularly amid tighter capital constraints That said, despite monetary tightening,

confidence in the eurozone banking sector has continued to hold up well This supports our view that the

risks from monetary tightening to consumer demand and banking sector stability in the eurozone have been overplayed

Emerging Asia: The Emerging Asia banking outlook is generally positive, though we have some

concerns about some of the highest flying sectors In particular, we are concerned that loan loss

provisions in the Chinese banking system are hugely underestimated and that the stability of the industry rests on non-performing loans remaining well behaved, which has historically not been the case following policy-driven lending sprees Despite the potential for economic damage following the March 2011 earthquake and tsunami to have a negative impact on Japanese banks’ assets in the short term, we are bullish about Japanese banking sector equities However, we note that this is due to our expectation of multiple expansion rather than improvements to banks’ balance sheets, which we expect to be negatively affected by rising bond yields

End To Deflation In Sight

Japan – Client Loans, % change y-o-y

Source: Bank of Japan, BMI

Emerging Europe: While Western Europe is struggling to contain a regional sovereign debt crisis and

revive economic growth, the same pressures are less severe in emerging Europe With the exception of idiosyncratic cases, banking sectors across emerging Europe are broadly on the road to recovery and due

to expand at a faster rate in 2011 than in 2010 Efforts to raise capital ratios, as well as less severe

sovereign debt stresses than in the eurozone and the UK, will buoy sentiment and growth over the

medium term

On The Mend

Emerging Europe – Bank Sector Assets, % change y-o-y

Source: BMI, central banks

Latin America: We expect massive expansion of the financial services sector in Latin America over the

next few years, driven by an expanding middle class, financial market integration and the ongoing search for yield among developed market investors This is not a new theme for the region, but it is one we believe will continue to offer opportunities for high-end financial services expansion over the next few years As the Latin American population becomes richer, demand for companies that are able to manage this wealth will continue to increase and big financial names are set to keep expanding their footprints in the region

Sub-Saharan Africa: The region’s major banking sectors (South Africa, Nigeria and Kenya) are all

continuing their recoveries, albeit with varying degrees of strength Forecast strong economic growth will boost incomes, which will in turn enable an increase in deposits and greater take-up of banking services Rebounding economic activity and improved liquidity are bolstering banking sector growth

Liquidity Improving

MENA – Banking Sector Deposit Growth, % change y-o-y

Source: BMI, central banks

Middle East and North Africa: The outlook for banks across the MENA region is by no means uniform

We expect banks in Qatar and the UAE to outperform through the rest of 2011 as higher oil prices and improved sentiment enable Doha and Dubai to solidify their reputations as stable hubs for the regional financial services industry In contrast, the outlooks for Bahrain and Egypt’s banking sectors remain particularly weak and a marked decrease in asset quality should be expected as a result of widespread social unrest and disruptions to local economic activity

Asia Banking Sector Outlook

Islamic Finance In Asia: Permeating Across Borders

Islamic banking and shari’a-compliant financing activities will expand significantly over the medium

term, with countries such as Malaysia and Indonesia becoming increasingly competitive While there will still be resistance to Islamic finance, especially in South Korea, due to local religious sensitivities, we generally expect the industry to penetrate deeper into the region, including in non-Muslim majority

countries, due to rising profitable opportunities within the Islamic world

We believe the Islamic banking industry in Asia will continue to achieve impressive growth over the

medium term, with predominately Muslim countries such as Malaysia and Indonesia spearheading this expansion We also expect non-Muslim majority economies, including Singapore, Hong Kong, and even Australia, to experience a rise in Islamic financing activities following encouragement by their respective authorities The key exception, however, will be the South Korea, due to potential political opposition from some Christian quarters in the country

Malaysia: Leader Of The Pack

In terms of value of total global sukuk (Islamic bonds) and number of issuances, Malaysia stands out as a

global leader, outpacing even its Middle Eastern counterparts The country has been responsible

for US$94bn worth of total sukuk issuances, comprising 66% of total outstanding global sukuk Key

Malaysian underwriters such as CIMB and Malayan Banking (Maybank) regularly dominate

Bloomberg’s Islamic finance league tables, outpacing other firms such as Dubai Islamic Bank (DIB)

CIMB currently clinches the top spot (as of April 19 2011), having underwritten US$1.1bn worth of new Islamic issuances, while Maybank issued US$518.3mn DIB, on the other hand, underwrote

US$277.9mn Other key Malaysian underwriters include RHB and AmInvestment Bank, which are

among the top 10 Islamic underwriters

Malaysian Underwriters Dominate

Global – Top 10 Islamic Underwriters Jan-April 2011 By Total Deals, US$mn

Source: Bloomberg

In early 2011, the Malaysian government unveiled the Shari’a Governance Framework, which is designed

to reduce legal uncertainty in shari’a-compliant financing activities The 2009 Central Banking Act also says the Shari’a Advisory Council - the highest Islamic finance authority in Malaysia - will have the final say in the event of any disputes, helping to provide a sound legal framework in Malaysia The high court has appointed a judge who specialises in Islamic finance-related litigation, providing Malaysia with an attractive legal environment for Islamic banks

Roaring Ahead

Malaysia – Islamic Financing, MYRmn and % of total loans

Source: Bank Negara Malaysia, BMI

Malaysia’s progress in Islamic finance puts it in pole position to be a global leader in influencing industry development of shari’a-compliant banking in other aspiring countries We believe the Islamic Financial Services Board, an international advisory group based in Kuala Lumpur, will have an increasingly

important role going forward While this should ultimately result in greater competition between

countries, Malaysia’s first-mover advantage and supportive infrastructure should help it evolve into an important regional, or even global, Islamic financial hub

Budding Opportunities In Indonesia

While they are not as well developed as Malaysia in terms of scale and international reach, we believe the Islamic banking industries in Indonesia, Pakistan and Bangladesh will still experience firm domestic expansion over the coming years, catering for rising demand from Muslim populations This should provide interesting expansion opportunities for local banks and foreign players that are interested in setting up in these countries

Follow The Leader

Asia – Islamic Financial Assets, US$bn and % of banking sector

* = estimate Source: Central banks, BMI

In Indonesia, shari’a-compliant banks and banking units recorded total assets worth US$11.0bn,

accounting for 3.2% of the country’s total banking assets In view of the country’s strong economic growth potential and large Muslim population (the largest in the world), we expect Islamic finance to increase in importance within the region In particular, Malaysia’s close proximity to Indonesia should put Malaysian banks in the best position to take advantage of this favourable trend

Bursa Malaysia-listed Affin Holdings is in the process of acquiring Indonesia’s Bank Ina Perdana

Interestingly, the bank is not a shari’a-compliant bank and all of its 25 branches will need to undergo a

conversion process that may take about two years Bank Internasional Indonesia and Bank Maybank Syariah Indonesia (a Maybank subsidiary) are in merger talks at the time of writing, indicating that the

Islamic banking sector in the country is gaining favour

Bangladesh And Pakistan: Key Frontiers

Bangladesh and Pakistan’s Islamic financial companies are considerably smaller than their South East Asian counterparts in terms of total assets and market capitalisation That said, we emphasise that they still play a considerably important role in their domestic banking sectors We estimate that shari’a-

compliant banking assets make up about 4% of the Pakistan’s financial assets In Bangladesh, a Daily Star report suggested that Islamic deposits account for more than 16% of the total in the banking sector

The development of Islamic microfinance is a potential growth area in these lower-income economies

over the coming decade The majority of microlending remains conventional, as the prohibition of usury

(riba), or late payment fees, has made the structuring of such high-risk loans difficult in Islamic finance

In view of these challenges, further financial innovation in Islamic instruments, such as murabaha

(cost-plus pricing that is suitable for small traders), may be required in order for Islamic microfinance to flourish

Rising Interest Elsewhere

Outside the Islamic world, there is increasing interest in Islamic finance from non-Muslim majority countries such as Thailand, Singapore, Hong Kong and even Australia In the aftermath of the global financial crisis, many investors regard shari’a-based lending and investment, which prohibits excessive

risk (gharir), as a safer, more reliable way of fund management (although this may be more of a

perception than an established fact) A well developed Islamic financial infrastructure will place these countries in good stead to receive and manage fund inflows from the Middle East, benefiting from the rise

in oil prices A key exception to this trend, however, is South Korea, where there has been vehement

opposition from the Christian lobby in the country A proposed law to allow the issuance of sukuk failed

to pass in 2011, indicating that the appeal of shari’a-based financing is not universal

Table: Banks’ Bond Portfolios

Bond Portfolio, US$bn Bond as % total assets Year-on-year growth %

Table: Asia Commercial Banking Business Environment Ratings

Limits of Potential Returns

Risks to Potential

Market Structure Structure Country Market Risks Country Risks Rating Ranking

Table: Comparison Of Loan/Deposit, Loan/Asset And Loan/GDP Ratios

Loan/

Deposit ratio % Rank Trend

Loan/

Asset ratio % Rank Trend

Loan/

GDP ratio % Rank Trend

Bangladesh 79.9 45 Rising 64.7 16 Falling 45.8 45 RisingChina 69.5 53 Rising 52.6 40 Rising 117.7 12 Rising

Hong Kong 54.1 57 Falling 31.4 55 Rising 197.5 4 RisingIndia 71.6 51 Falling 64.0 19 Rising 42.7 46 Rising

Indonesia 75.5 46 Rising 61.1 26 Rising 27.5 53 RisingJapan 72.1 52 Falling 51.3 41 Falling 87.2 21 Rising

Malaysia 79.3 43 Rising 59.0 27 Rising 114.3 9 RisingPakistan 80.6 31 Falling 59.9 24 Falling 26.7 52 Falling

Philippines 67.2 54 Falling 49.1 44 Falling 33.7 48 Falling

Singapore 74.4 48 Falling 41.3 50 Rising 106.3 16 RisingSri Lanka 74.4 50 Falling 56.7 33 Falling 25.9 55 FallingSouth Korea 122.1 14 Falling 69.5 7 Rising 110.3 15 Falling

Taiwan 77.7 49 Falling 61.0 29 Falling 146.1 7 Falling

Thailand 95.8 29 Falling 64.7 17 Falling 69.1 30 Falling

US 78.3 26 Falling 55.4 8 Falling 50.3 2 Falling

Source: Central banks, regulators, BMI

Table: Anticipated Developments In 2011

Loan/Deposit

Loan Growth, US$bn

Deposit Growth, US$bn

Residual, US$bn

Table: Comparison Of Total Assets, Client Loans And Client Deposits , 2009-2010(US$bn)

Total Assets Loans Client Deposits Client Assets Total Loans Client Deposits Client

China 13,472.9 7,085.8 10,189.3 11,853.4 6,234.0 8,964.5Hong Kong 1,412.6 444.2 820.9 1,374.5 424.0 822.7

India 1,130.2 723.3 1,009.7 885.2 568.3 785.3Indonesia 321.5 196.3 260.0 259.8 153.0 209.9

Table: Comparison Of Per Capita Deposits, 2010 (US$)

GDP Per Capita

Client Deposits, per capita

Rich 20% Client Deposits, per capita

Poor 80% Client Deposits, per capita