#1Emirates NBD Investor Presentation November/December 2013 Emirates NBD#2Important Information Emirates NBD Disclaimer The material in this presentation is general background information about Emirates NBD's activities current at the date of the presentation. It is information given in summary form and does not purport to be complete. It is not intended to be relied upon as advice to investors or potential investors and does not take in to account the investment objectives, financial situation or needs of any particular investor. These should be considered, with or without professional advice when deciding if an investment is appropriate. The information contained here in has been prepared by Emirates NBD. Some of the information relied on by Emirates NBD is obtained from sources believed to be reliable but does not guarantee its accuracy or completeness. Forward Looking Statements It is possible that this presentation could or may contain forward-looking statements that are based on current expectations or beliefs, as well as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use words such as anticipate, target, expect, estimate, intend, plan, goal, believe, will, may, should, would, could or other words of similar meaning. Undue reliance should not be placed on any such statements because, by their very nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results, and the Group's plans and objectives, to differ materially from those expressed or implied in the forward-looking statements. There are several factors which could cause actual results to differ materially from those expressed or implied in forward looking statements. Among the factors that could cause actual results to differ materially from those described in the forward-looking statements are changes in the global, political, economic, business, competitive, market and regulatory forces, future exchange and interest rates, changes in tax rates and future business combinations or dispositions. Emirates NBD undertakes no obligation to revise or update any forward looking statement contained within this presentation, regardless of whether those statements are affected as a result of new information, future events or otherwise. 2#3Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy Outlook Appendix Emirates NBD 3#4mn bpd 2.0 1.5 1.0 0.5 0.0 Dec-10 Feb-11 Apr-11 3.0 2.5 Jun-11 Aug-11 Oct-11 Dec-11 Feb-12 Oil production trends UAE Economic Update Highlights • The UAE's real GDP growth reached 4.4% in 2012 according to latest data from the National Bureau of Statistics • The main driver of growth last year was the oil sector, which expanded 6.3%; non-oil GDP grew 3.5%, up from 2.6% in 2011, driven mainly by service sector growth ⚫ The non-oil private sector continued to expand at a steady pace in Q3 2013, with the PMI reading for September coming in at 56.6; employment, staff costs and input prices continue to rise, but a competitive environment has meant output costs have been contained • 4.4% growth is forecasted for 2013, on the back of higher than expected oil production year-to-date; Growth is also expected to be driven by the services sectors as real estate continues to recover, and tourism growth supports trade and associated sectors • Inflation has averaged under 1% in the year to August. The 2013 forecast for average CPI is 1.5% before rising to 3% in 2014 Real GDP Growth Forecasts 2013 2014 2008 2009 2010 2011 2012 F F UAE UK Eurozone India US China 3.2% (2.4%) 1.7% 3.9% 4.4% 4.4% 4.1% (1.1%) (4.9%) 1.7% 1.1% 0.2% 1.0% 1.5% 0.4% (4.1%) 2.0% 1.6% 8.2% 6.4% 4.0% 3.0% 0.7% 0.5% (0.3%) (3.5%) 2.5% 1.8% 2.8% 2.0% 3.0% 9.6% 9.2% 10.4% 9.3% 7.8% 7.5% 7.0% (1.1%) (6.3%) 4.7% (0.6%) 2.0% 2.0% 1.8% (0.9%) 14.9% 5.3% 1.3% 2.6% Hong Kong 2.1% (2.5%) 6.8% 4.9% 1.5% 3.0% Source: Global Insight, Emirates NBD forecasts, Bloomberg (0.7%) (0.5%) 0.5% 1.8% 2.5% 3.6% 3.5% Japan Singapore Apr-12 Jun-12 Aug-12 Oct-12 Dec-12 Feb-13° Apr-13 Jun-13 Aug-13 22088420 USD per barrel UAE Oil Production (Ihs) Source: Bloomberg, Emirates NBD Research OPEC oil price (rhs) Source: HSBC, Markit 40 40 Jan-10 Mar-10 45 bps 60 50 May-10 Jul-10 Sep-10 Nov-10 55 59 Jan-11 Jan-11 Mar-11 May-11 60 UAE PMI - Private Sector Expansion Trends Jul-11 Sep-11 Nov-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 4 Emirates NBD#5Bps (in 10s) 1 2 UAE Economic Update (cont) Emirates NBD Highlights . • Total bank loan growth (net of provisions) reached 6.4% y-o-y in July; while this is still well below regional peers, the data shows a steady improvement, particularly in the retail and personal loan segment Deposit growth in the UAE still outpaces loan growth; bank deposits grew 12.4% y-o-y in July, and the cumulative increase in bank deposits year-to-July was AED85.3bn, compared with an AED45.2bn increase in deposits over the same period last year; consequently, the loans-to- deposit ratio was at 92.6%, near the lowest level in at least five years • 3M EIBOR rate continued to ease as liquidity in the banking system improved. Dubai CDS remained near multi-year lows, reflecting confidence in the economic recovery and prospects for growth going forward EIBOR - LIBOR spreads 510 460 410 360 310 260 Trends in CDS spreads Dubai (Ihs) Abu Dhabi (rhs) 160 150 140 130 120 110 100 90 80 70 60 Sep-13 S 210 160 110 60 Jan-12 May-12 Sep-12 Jan-13 May-13 Source: Emirates NBD Research, Bloomberg Bank deposit and loan growth + 3 CO 5 Spread EIBOR -LIBOR -1 -2 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Source: Bloomberg y-o-y Growth % 80620864212 -2 Aug-09 Bank deposits Oct-09 Dec-09 Feb-10 Apr-10 Jun-10 Aug-10 Oct-10 Dec-10 Feb-11 Apr-11 Jun-111 Aug-11 Oct-11 Dec-11 Feb-12 Apr-12 Source UAE Central Bank Jun-12 Bank Loans Aug-12 Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 5#6Dubai Economic Update Highlights Dubai's real GDP growth was 4% in 2012; the main driver of growth was manufacturing, which expanded 13% y-o-y, and contributed 2% to the headline growth figure Dubai's 2013 GDP growth is forecasted at 4%; continued expansion in the manufacturing, trade and hospitality sectors as well as a continued recovery in real estate and business services should support broader business activity; construction sector expected to contribute positively to GDP growth for the first time since 2008, as recently announced projects get underway The estimate for H1 2013 of 4.9% growth is well above our forecast of 4% for the whole of 2013 Non-oil trade with other GCC countries, particularly Saudi Arabia and Qatar, are likely to continue to offset any weakness in trade with Europe and the US Dubai: Real GDP growth Y-o-y growth % Emirates NBD 6.0% 5.0% 4.9% 4.3% 4.0% 4.0% 3.2% 3.2% 2.7% 3.0% 2.0% 1.0% 0.0% -1.0% -2.0% -3.0% 2008 -2.4% 2009 2010 2011 2012 2013f 2014f - Source: Emirates NBD Research, Dubai Statistics Centre Dubai GDP – Composition by Sector, and Sector Growth Dubai GDP by Sector (%) - H1 15.0 2013 Fin Servcs. 12% Hotels 10.0 5% 5.0 Trade 29% Trans. 0.0 & 2012e 2013f comm. 14% Manuf. 16% RE 21% Other 3% -5.0 ■ Other ■Hotels ■Manuf. ■Trade RE Fin Servcs. ■Trans. & comm. Source: Dubai Statistics Centre, Haver Analytics 6#7140 Dubai Economic Update (cont) Highlights Dubai is the 3rd largest centre for re-exports in the world which itself represents almost 50% of GDP Dubai is a strategically located international trading hub with some of the world's best air and sea ports serving over 205 destinations Very large investment in infrastructure has a highly positive effect on the long-run development and productivity of the emirate • Airport passenger arrivals and tourism data show encouraging trends Dubai's Strategic Location Dubai: Air passenger arrivals and tourism trends 120 100 80 60 - 40 - 20 Jul-09 Oct-09 Jan-10 Apr-10 Jul-10 Oct-10° Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13 RevPAR (AED 10s) (lhs) Passenger traffic (mn people) (rhs) Hotel Occupancy (%) (lhs) Source: Emirates NBD Research, Dubai Statistics Centre, Bloomberg 1 0 65432 AED Billion Dubai: External trade growth trends 900 60% 800 50% 40% 700 30% 600 20% 500 10% 400 0% 300 -10% 200 -20% 100 -30% 0 -40% 2006 2007 2008 2009 2010 2011 2012 2013e Imports Source: Emirates NBD Research, Dubai Statistics Centre Exports & Re-Exports 7 y-o-y Growth % Emirates NBD#8y-o-y % change -20% -40% -60% Jan-07 Source: Cluttons, Bloomberg 0% Dubai Economic Update (cont) Highlights Dubai property prices continued its upward trend in 2013 After dropping an average of 31% in 2009 compared to 2008 (-36% for villas and -27% for apartments), property prices have grown at an average of 39% year-to-date upto Sep-13 (+44% for villas and +35% for apartments) ENBD Share Price up 93% in Oct-13 since the beginning of 2013 60% Mid range villa Mid range apartment 40% 20% Price per sq ft (In AED) Dubai Property Prices y-o-y % change Source: Cluttons, Bloomberg ENBD Share Price May-07 Sep-07 Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11 Sep-11 Jan-12 May-12 Sep-12 Jan-13 May-13 Sep-13 ENBD Price (in AED) 6.5 6.0 5.5 5.0 4.5 4.0 3.5 3.0 2.5 2.0 Jan-11 Mar-11 May-11 Source: Bloomberg Jul-11 Sep-11 Nov-11- Jan-12 Mar-12- May-12- Jul-12 1300 1100 900 700 500 Dubai Property Prices (in AED) 1700 Mid range villa Mid range apartment 1500 Jan-06 Jun-06 Nov-06 Apr-07 Sep-07 Feb-08 Sep-12- Nov-12- Jan-13 Mar-13 May-13- Jul-13- Sep-13- Jul-08 Dec-08 May-09 Oct-09 Mar-10 Aug-10 Jan-11 Jun-11 16.0 M 14.0 12.0 10.0 8 2.0 8.0 6.0 4.0 ENBD Volume (Mns) Nov-11 Apr-12 Sep-12 Feb-13 Jul-13 Emirates NBD#9UAE Banking Market Update Emirates NBD Highlights UAE Banking sector is the largest by assets in the GCC; sector is dominated by 23 local banks which account for more than 75% of banking assets; 28 foreign banks account for the remainder UAE Banking Sector Growth (AED billion) Banking Assets Nominal GDP 2,500 Loans & Advances Deposits 45% 40% 2,000 35% 1,500 30% 25% 20% 1,000 15% 10% 500 5% as 0 0% In the past couple of years the Central Bank of the UAE has sought to play a stronger role in the oversight and governance of the Banking Sector in the UAE This has resulted in a new regulatory regime with various regulations being considered covering areas such liquidity risk, large exposures and mortgage caps amongst others. AED Billion 321 2002 33 273 2003 36 387 2004 448 639 506 1,223 643 2006 859 758 954 1,056 2011 1,734 1,281 2012 1.877 1,411 2013 1.415 Composition of UAE Banking Market (AED billion) Loans 254 998 1,252 GCC Banking Market UAE(1) Banking Assets USD billion Deposits 229 1,024 1,253 Assets 352 1,608 KSA Qatar Kuwait 1,960 Bahrain(2) 49 Oman 57 ■ Emirates NBD Other Banks Source: UAE Central Bank Statistics as at Jul 2013, ENBD data as of Q3 2013. Loans and Assets presented gross of impairment allowances 180 243 Assets % GDP(3) y-o-y Growth % 509 132% 484 64% 120% 101% 154% 69% 1) Includes Foreign Banks; 2) Excludes Foreign Banks; 3) GDP data is for FY 2013 forecasted. Oman, Bahrain, KSA as at Aug 2013, Kuwait, Qatar as at Sep 2013 and UAE as at Jul 2013 Source: UAE Central Bank; National Central Banks and Emirates NBD forecasts 6#10Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy Outlook Appendix Emirates NBD 10 10#11Summary • One of the largest financial institutions (by asset size) in the GCC • Flagship bank for Dubai Government • 56% owned by Dubai Government Emirates NBD Consistently profitable; despite significant headwinds during the global financial crisis Fully fledged, diversified financial services offering • Ever increasing presence in the UAE, the GCC and globally • Well positioned to grow and deliver outstanding value to its shareholders, customers, and employees 11#12Emirates NBD at a glance A leading bank in UAE Market share in UAE (at 30 Sep 2013): Assets c.18%; Loans c.20.3% - Deposits c.18.2% Retail market shares (estimated at 30 Jun 2013): Personal loans c.14% Home loans c.4% - Auto loans c.17% Credit cards c.15% Debit cards c.23% Fully fledged financial services offerings across retail banking, private banking, wholesale banking, global markets & trading, investment banking, brokerage, asset management, merchant acquiring and cards processing Credit Ratings Long Term Short Term Outlook M Baa1* P-2 Negative Moody's Fitch Ratings CCAPITAL A+ F1 Stable** intelligence A A1 Stable*** Emirates NBD Largest Branch Network in the UAE Ras al-Khaimah (3) Dubai 100 Abu Dhabi 26 Umm al-Quwain (2) Sharjah Other 14 -Fujairah (3) 10 Ajman (2) Total 150 Dubai (100) Sharjah (14) Abu Dhabi (26) International Presence *LT debt ratings, standalone credit assessment and Bank Financial Strength Rating (BFSR) downgraded by one notch to Baa1/ba2/D+ from A3/ba1/D on 12 Dec 2012; **Viability Rating downgraded to 'bb+' from 'bbb'; removed from RWN on 26 Apr 2012;***reduced Financial Strength Rating (FSR) to 'BBB+' from 'A-' on 27 Nov 2012 Branch Rep office BNPP Egypt (69 branches) Conventional Islamic Total 100 50 150 12#13Emirates NBD is the Largest Bank in the UAE and one of the largest in the GCC by Assets as at 30 Sep 2013 Emirates NBD ADCB UAE Ranking by Profits (AED million) 41 NBAD 33 FGB 30 Emirates NBD 24 3,656 3,402 2,583 2,572 UNB 1,430 Mashreq 1,301 RAK 1,137 ADIB 1,106 CBD 752 DIB* 700 UAE Ranking by Assets (AED billion) UAE Ranking by Shareholder's Equity (AED billion) NBAD 345 Emirates NBD Emirates NBD FGB 332 190 NBAD FGB ADCB 175 DIB* 111 ADIB 96 UNB 86 ADCB DIB* UNB Mashreq 24 Mashreq 83 CBD 42 RAK 29 15 ADIB 13 CBD 7 RAK 6 655 16 GCC Ranking by Assets (AED billion) QNB 441 NCB 359 NBAD 345 Emirates NBD 332 Al Rajhi* 268 NBK 246 KFH* 205 SAMBA* 201 FGB 190 Riyad Bank* 188 GCC Ranking by Shareholder's Equity (AED billion) QNB NCB Emirates NBD GCC Ranking by Profits (AED million) 33 31 30 ☺ ☺ ☺ ☺ co w w 52 41 41 37 QNB 7,168 NCB 5,932 Al Rajhi 5,770 NBAD 3,656 SAMBA 3,432 35 FGB 3,402 33 Riyad Bank 2,857 SABB 2,741 Emirates NBD 2,583 ADCB 2,572 13 Al Rajhi* KFH* 35 NBK NBAD SAMBA* Riyad Bank* FGB *Data as at Q2 2013; Source: Bank Financial Statements and Press Releases, Bloomberg#14Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy Outlook Appendix Emirates NBD 14 14#15Profit and Balance Sheet Growth in Recent Years Revenues and Costs (AED billion) Revenues Costs Profits (AED billion) Pre-Provision Operating Profits Emirates NBD Net Profits 3.3 10.8 9.7 9.9 10.2 3.6 3.7 3.5 7.1 2.5 8.7 3.1 6.6 6.3 6.5 0.1 2.5 2.2 2.5 2.5 0.9 1.0 2.9 1.5 5.7 2.3 [+13% 1.0 1.5 0.8 +7% 1.4 1.6 0.2 2.6 2.6 +16% 0.4 0.7 +37% 8.3 7.5 7.4 7.7] 3.2 2.7 2.3 2.5 2.7 5.6 5.1 4.9 4.9 1.9 2.3 1.9 2009 2010 2011 2012Q3 13 2009 2010 2011 2012 Q3 13 YTD YTD 2009 2010 2011 2012 Q3 13 YTD 2009 2010 2011 2012Q3 13 YTD Assets and Loans (AED billion) Assets Loans Deposits and Equity (AED billion) Deposits Equity +4% +2% +6% 332 +8% 282 286 285 308 215 234 196 203 218 181 200 193 214 229 35 26 28 29 31 55 2009 2010 2011 2012Q3 13 YTD 2009 2010 2011 2012 Q3 13 YTD 2009 2010 2011 2012 Q3 13 YTD 2009 2010 2011 2012 Q3 13 YTD 15 Equity is Tangible Shareholder's Equity excluding Goodwill and Intangibles.; All P&L numbers are YTD, all Balance Sheet numbers are at end of period Source: Financial Statements#16Q3 2013 YTD Financial Results Highlights Emirates NBD Highlights YTD Net interest income rose 15% helped by increased volumes in higher yielding retail products, declining EIBOR, cheaper bank borrowings, more efficient capital structure and contribution from business in Egypt • YTD Non-interest income improved 9% due to seasonal effects • YTD Costs rose by 8% (3.2% excluding the newly acquired Egypt business), YTD cost to income ratio improved by 1.6% to 33.6% Pre-impairment operating profit improved 8% q-o-q and 16% y-o-y Conservative provisioning in line with guidance for the year with net impairment allowances at AED 3.4 billion, increasing the coverage ratio YTD by over 7% to 54.8% Gain of AED 191 million on disposal of stake in Union Properties Net profit of AED 2,584 million YTD improved 34% compared to Q3 12 YTD • Net loans increased 7% YTD AED million operating profit Key Performance Indicators Q3 13 YTD Q3 12 Better/ Q3 13 Q2 13 YTD (Worse) Better/ (Worse) Net interest income 5,915 5,146 15% 2,254 1,913 18% our Non-interest income 2,780 2,560 9% 891 1,007 (12%) Total income 8,695 7,706 13% 3,145 2,920 8% Operating expenses (2,920) (2,710) (8%) (1,038) (973) (7%) Amortisation of (47) (60) 21% (16) (16) 0% intangibles Pre-impairment 5,728 4,936 16% 2,091 1,931 8% Impairment allowances (3,400) (3,064) (11%) (1,515) (996) (52%) Operating profit 2,328 1,872 24% 576 935 (38%) Share of profits and impairment of associates Gain on disposal of subsidiaries 101 73 38% 34 41 (16%) 191 0 n/a 191 n/a Taxation charge (36) (16) (126%) (26) (3) (654%) Net profit 2,584 1,929 34% 775 973 (20%) Cost: income ratio (%) 33.6% 35.2% Net interest margin (%) 2.57% 1.6% 2.42% 0.14% 2.83% 33.0% 33.3% 0.3% 2.48% 0.35% AED billion 30-Sep-13 30-Jun-13 Better/ (Worse) Better/ 31-Dec-12 (Worse) Total assets 332.3 334.8 • Deposits increased 7% YTD (1%) 308.3 8% Loans 234.4 231.8 1% 218.2 7% • Headline LTD ratio of 102.5% remains comfortably within 95-105% target range Deposits 228.6 230.3 (1%) 213.9 7% 16#17Net Interest Income Emirates NBD Highlights NIM improved by 35bps to 2.83% in Q3 2013 from 2.48% in Q2 2013 due to a 17bps increase in loan spreads and an 18bps increase in Treasury spreads Loan spreads improved as retail volumes increased for this higher yielding business, coupled with increased margins from the Egyptian business and a positive impact from the drop in EIBOR rates Treasury spreads improved due to cheaper bank borrowings and from increased hedging income as the Bank took advantage of the recent rise in swap rates to hedge some positions Net Interest Margin (%) 2.96 2.85 2.69 2.63 2.63 2.28 Qtrly NIM YTD NIM 2.83 2.56 2.47 2.48 2.45 2.42 2.39 2.43 2.42 2.39 2.35 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Net Interest Margin Drivers (%) Q1 2013 to Q3 2013 2.83 0.00 0.18 0.01 0.02 0.00 2.48 0.17 2.39 0.13 0.03" Q1 2013 Loan Deposit Treasury Spreads Spreads Spreads Other Q2 2013 Loan Deposit Treasury Other Spreads Spreads Spreads Q3 2013 17#18Non Interest Income Emirates NBD Highlights Q3 2013 YTD Non interest income increased by 9% from same period last year Composition of Non Interest Income AED million Q3 13 YTD Q3 12 YTD % Q3 13 Q2 13 % - Higher core fee income by 8% - Higher property income of AED 272 million relative to AED 52 million Core gross fee income 2,485 2,243 +11% 817 876 -7% - Offset by lower investment securities income by 31% Q3 2013 YTD Core gross fee income improved by 11% due to - - improvement in trade finance income (+14%) improvement in fee income (+24%) increase in brokerage and asset management fees (+80%) offset by decrease in forex, rates and other income(-12%) Fees & commission expense Core fee income Property income / 2,164 272 (321) (230) +40% (136) 2,013 +8% 681 52 +423% 110 124 (115) +18% 761 -11% -11% (loss) Investment 343 496 -31% 101 122 -17% securities Total Non Interest Income 2,780 2,560 +9% 891 1,007 -12% Core Gross Fee Income Trends (AED million) Core Gross Fee Income Trends (AED million) 215 59 99 2,485 +20% 876 67 2,243 792 817 735 +7% 682 266 186 256 148 274 47 50 17 37 33 380 395 360 263 335 157 165 163 183 186 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q3 12 YTD Trade finance Fee Income Brokerage & AM fees Forex, Rates & Other Q3 13 YTD Forex, Rates & Other Brokerage & AM fees Fee Income Trade finance 18#19Operating costs and Efficiency Highlights Costs increased by AED 209 million or +8% y-o-y to AED 2,920 million in Q3 2013 YTD resulting from: Increase of AED 217 million in staff costs Cost to Income Ratio Trends 41.1 Emirates NBD CI Ratio (YTD) CI Ratio - AED 120 million in BNPPE acquisition and operating cost 37.5 35.6 35.2 35.2 - AED 32 million increase in occupancy costs, and AED 49 million increase in other costs 34.6 33.6 33.9 33.4 35.3 35.2 35.4 35.8 34.7 - Offset by AED 214 million decrease in Dubai Bank costs • Excluding BNPPE costs increased 3.3% y-o-y • The Cost to Income ratio for Q3 2013 YTD was at 33.6% which is within the longer term target range of 34-35% Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 33.3 33.0 32.6 Operating Cost Trends (AED million) Operating Cost Components (AED million) 32 +19% 217 49 90 2,920 958 909 874 [79] 2,710 8 973 =42= 1,038 81+7% 69- 534 580 614 614 502 65 58 71 62 77 81 -66 70 -72 -70 172 216 189 169 191 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q3 12 YTD Staff Occupancy Other DB/BNPPE Q3 13 Cost cost Cost YTD DB/BNPPE Occupancy cost Other Cost Staff Cost Depreciation 19#20Credit Quality Highlights Emirates NBD Impaired Loan & Coverage Ratios (%) The impaired loans ratio increased by 0.2% q-o-q to 14.1% Net impaired loans increased by AED 1.2 billion mainly due to a AED 1.1.billion increase in impaired loans in the Islamic corporate portfolio 72.3 69.8 73.0 74.1 76.5 47.8 49.4 51.4 52.7 54.8 Net provisions increased by AED 1.5 billion • Coverage ratio increased by over 2% to 54.8% 14.4 14.3 14.2 13.9 14.1 Total portfolio impairment allowances amount to AED 3.9 billion or 2.5% of credit RWAS 6.2 6.1 6.0 5.7 5.6 8.2 8.2 8.2 8.1 8.5 2013 Management targets for coverage ratios: Underlying NPL Portfolio Overall impaired Loans 80-85% 55-60% Q3 12 Going forward the Bank aims to keep improving the coverage ratios through continued conservative provisioning Q4 12 Impact of DW/DH* % NPL ratio, excl. DW/DH* Q1 13 Q2 13 Q3 13 Coverage ratio, excl. DW/DH* % Coverage ratio, incl. DW/DH* % Impaired Loans and Impairment Allowances (AED billion) Impaired Loans Impairment Allowances 32.9 14.2 33.6 33.8 34.7 35.9 19.7 15.7 16.6 17.4 18.3 3.2 14.4 9.6 3.9 10.1 3.8 14.3 14.3 14.3 2.2 3.2 3.1 3.2 10.6 3.8 11.3 11.4 3.6 7.3 7.3 7.9 8.4 9.4 0.4 0.4 0.4 4.8. 4.9 4.7. 5.1 3.7.0.3 6.2 0.3 3.8 3.8 3.8 3.8 3.8 0.3 2.1 0.2.2.1 0.2 2.3 0.2 2.7 3.0 0.3 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 DW/DH* Core Corporate Retail Islamic Investment Securities *DW/DH = includes D1 (exposure AED 9.36 billion; provision AED 482 million) and D2B (exposure AED 4.62 billion; provision AED 2.51 billion) 20 20#21Credit Quality Composition of Gross Loan Portfolio Emirates NBD Corporate and Retail Lending Portfolio By Type (AED 256 bn) By Econ Sector (AED 256 bn) Trans Retail 9% & Cont. 3% Others 4% Corporate & Sovereign Loans (AED 195 bn) com. Manuf. Trade 5% Manuf. Trade Trans. & com Cont. 4% 3% 5% 3% Per. - Others 4% Sover Sov. 34% Corp. 3% eign Per. - Corp. Sov. 44% 34% Serv. 4% 9% Corpo Serv. 11% rate Islami RE Per. - Ret. 42% 10% 15% Fin Inst 13% C 15% Fin Inst 12% RE 10% Islamic Lending Portfolio By Type (AED 37 bn) Deposits by Type By Econ Sector (AED 37 bn) By Type (AED 229 bn) Sov. Istissn Other 1% a'a S Wakal 4% a 5% 7% Credit card receiv ables Retail 42% RE 23% Fin Inst 13% 2% Murab Ijara aha Serv. 31% 51% 5% Per. - Trade Cont. Others Corp. 4% Trans. & 2% Manuf. 3% 4% com. 1% 2% Others 1% Time 47% CASA 52% Retail Loans (AED 24 bn) Overdr afts 6% Others 10% Car Person al Loans Loans 13% 38% Credit Cards 16% Time Loans 3% Mortga ges 14% Islami C 19% By Type (AED 229 bn) Conve ntional 81% 21#22Capital Adequacy Highlights CAR and T1 improved by 0.5% and 0.4% q-o-q to 19.0% and 14.9% respectively resulting from: - increase in Tier 1 capital through profit generation - Ongoing issuance of Tier 2 private placements 1% reduction in RWAs, primarily market risk • Tier 1 Capital has now improved by 1.7% y-o-y from 13.2% to 14.9%. • To date we have repaid AED 7.8 billion of the AED 12.6 billion Ministry of Finance Tier 2 deposits. Capital Movements (AED billion) Capitalisation Emirates NBD 44.5 19.9 20.6 19.7 18.5 19.0 13.8 13.5' 14.5 14.9 13.2 45.0 43.2 42.8 43.6 14.9 14.9 13.8 9.2 9.4 29.6 30.1 29.4 33.6 34.2 Q3 12 Q4 12 Q1 13 T2 T1 T1 % Q2 13 CAR % Q3 13 Risk Weighted Assets - Basel II (AED billion) 31 Dec 2012 to 30 Sep 2013 Tier 1 Tier 2 Capital as at 31 Dec 2012 30.1 14.9 Total 45.0 +2% Net profits generated 2.4 2.4 FY 2012 dividend paid (1.4) (1.4) 224.2 14.0 2.6 218.1 13.8-2.3 219.7 13.8 3.6 231.1 13.8 3.4 13.8 2.31 229.8 ... -1% Tier 1 issuance 3.7 3.7 Repayment of Tier 2 (6.2) (6.2) 207.6 202.0 202.3 213.9 213.6 Amortization of MOF T2/ (1.1) (1.1) subordinated debt Interest on T1 securities (0.1) (0.1) Tier 2 issuance 3.1 3.1 Q3 12 Repayment of subordinated debt (1.3) (1.3) Q4 12 Operational Risk Q1 13 Market Risk Q2 13 Q3 13 Credit Risk Other (0.5) (0.5) Capital as at 30 Sep 2013 34.2 9.4 43.6 22 22#23Funding and Liquidity Highlights Headline LTD ratio of 102.5% at Q3 2013 Loan to Deposit (LTD) Ratio (%) The LTD ratio is being managed within a target range of 95%-105% 107.0 105.1 Liquid assets* of AED 33.7 billion as at 30 September 2013 (11.6% of total liabilities) Debt maturity profile comfortably within existing funding capabilities Issued AED 3.67 billion of Tier 1 capital notes in 2013 Issued AED 3.12 billion of Tier 2 notes in 2013 Issued AED 3.08 billion of senior debt in 2013 102.0 99.9 99.2 97.9 Emirates NBD 102.5 100.6 98.9 Target range 95-105% LTD Ratio (%) Repaid AED 7.8 billion to Ministry of Finance in H1 2013 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Liabilities and Debt Issued Liabilities - AED 291 bn Debt/Sukuk Others Debt Issued - AED 21.45 bn Sukuk Composition of Liabilities/Debt Issued and Maturity Profile of Debt Issued (AED million) Maturity Profile of Debt/Sukuk Issued 100% = AED 21.45 billion 5,821 Banks 7% 9% 17% 5% 3,708 Loan securitisations 3,061 3,100 14% 1,253 1,174 1,560 1,504 69% 43 226 0 78% EMTNS 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Customer deposits *including cash and deposits with Central Banks but excluding interbank balances and liquid investment securities 23#24Loan and Deposit Trends Emirates NBD Highlights Signs of modest pickup in new underwriting across all business segments with 8% growth in gross loans from the start of 2013 and 2% growth over the quarter Consumer lending showing strong growth, up 5% q-o-q and 27% y-o-y with growth spread across all areas including Personal Loans, Mortgages, Credit Cards and Car Loans • Islamic financing showed good growth, up 2% q-o-q and 16% y-o-y More costly time deposits continue to decline. • 30% CASA growth since start of year CASA deposits as a percentage of total deposits have increased to 52% at end of Q3 2013 from 43% at the end of 2012 Trend in Gross Loans by Type (AED billion) +2% 250 254 235 238 +8% 216 205 179 181 189 191 163 166 22 22 23 21 20 28 33 23 26 26 34 27 34 35 0 Q4 10 Q4 11 Corporate Q4 12 Consumer Q1 13 Islamic Q2 13 Treasury Q3 13 Trend in Deposits by Type (AED billion) -1% 230 229 214 223 200 2 3 193 1 2 +14% 1 120 112 107 138 113 122 116 118 91 102 79 61 Q4 10 Q4 11 Q4 12 Q1 13 Q2 13 Q3 13 Other Time CASA 24 24#25Acquisition of BNP Paribas Egypt Emirates NBD Highlights On 9 June 2013, Emirates NBD acquired a 95.2% stake in BNP Paribas Egypt Acquisition of the remaining 4.8% shares were completed in September 2013 • The total consideration was USD 500 million which is 1.4 times the fair value of net assets acquired The difference between the fair value of assets acquired and purchase consideration is the goodwill • The fair value of the assets and liabilities was determined by an external expert The purchase price allocation exercise resulted in following allocations; i) Banking license AED 357m ii) Core deposits AED 99m iii) Goodwill AED 136 m • Acquisition related costs of AED 24.4 million were incurred and are included in General & Administrative expenses Financial Impact Upon Acquisition (AED million) AED million 1,128 118 Book value of assets Fair value adjustments Fair value of net assets acquired Goodwill and intangibles Purchase consideration paid Represented by: Purchase consideration paid in cash Acquisition related cost 1,246 592 1,838 1,836 2 25 25#26Acquisition of BNP Paribas Egypt Business Overview Emirates NBD Business Overview Full service commercial banking platform: - - - Corporate Banking: focused on large corporate and MNCs; serves c.3,000 clients Retail Banking: High growth segment; serves c.195,000 clients Treasury: AUMs of c. USD 800m; serves c.670 clients • Wide presence in Egypt through an extensive network of 69 branches and 161 ATMs; rolled out 59 branches in the last 6 years Financially sound with robust profitability and a healthy balance sheet Financial Highlights AED million Dec 2011 Dec 2012 Net interest income Non-interest income 290 322 191 143 Total income 481 465 Operating expenses (301) (261) Pre-impairment operating profit 180 204 Impairment allowances (18) (23) Operating profit 162 181 Tax (29) (26) Net Profit 133 155 Cost to Income ratio 62.5% 56.1% Net interest margin 3.5% 3.9% AED billion Dec 2011 Dec 2012 Segment Breakdown Loans 4.0 3.5 Deposits 7.7 7.6 Gross Loans Deposits 100% = AED 3.5 billion 100% AED 7.6 billion NPL Ratio 4.6% 3.8% NPL Coverage ratio 116% 128% 64% Corporate Retail 36% Corporate 51% 49% Retail 26 26#27Associates and Joint Ventures Highlights De-risking of investment in Union Properties (UP) since 2009: - During Q3 2013 YTD, ENBD disposed of 32.6% of UP shares in the market A gain of AED 191 million was recorded - ENBD holds 15% of UP Emirates NBD Composition of Associates and Joint Ventures Income Statement Q3 13 Q3 12 AED million % Q3 13 Q2 13 % YTD YTD National General Insurance 32 10 +220% 12 -33% Network International 68 59 +15% 26 29 -10% Bank Islami Pakistan 1 4 -75% 0 0 n/a Total 101 73 +38% 34 41 -17% Balance Sheet - Since percentage of holding is less than 20%, ENBD does not have significant influence in UP UP holding has therefore been accounted as AFS investment from 21 August 2013 Network International accounted for as a jointly controlled entity from the start of 2011 with a carrying value of AED 1.4 billion ⚫ 24.8% stake in Bank Islami Pakistan acquired as part of Dubai Bank AED million 30-Sep-13 31-Dec-12 % 30-Jun-13 % National General Insurance 153 132 +16% 146 +5% Network International 1,413 1,394 +1% 1,435 -2% Bank Islami Pakistan 23 23 -1% 23 -2% Total 1,588 2,080 -24% 1,905 -17% 27 27#28Divisional Performance Wealth Management Consumer Banking & Wholesale Banking . Emirates NBD . . Continued focus on re-alignment to ensure enhanced future customer service quality and share of wallet, increased cross-sell of Treasury and Investment Banking products and increased Cash Management and Trade Finance penetration Revenue increased 7% y-o-y (from Q3 2012 YTD to Q3 2013 YTD) Loans rose by 6% from end of 2012 as new underwriting more than offset normal loan repayments Deposits grew by 2% from end of Q4 2012 Balance Sheet Trends AED billion +6% Revenue Trends AED million -7% 186.8 176.0 4,637 161.1 162.0 4,400 4,317 1,132 1,126 1,194 3,388 931 94.2 80.0 81.9 69.8 +2% 3,274 3,505 3,123 2,457 2010 2011 2012 Q3 13 Loans YTD Deposits 2010 2011 2012 Q3 13 YTD NFI NII CWM continued to improve its position during the quarter Revenue improved 13% y-o-y (from Q3 2012 YTD to Q3 2013 YTD) Deposits increased 7% from end 2012 Loans grew 20% from end 2012 driven by growth in mortgages, personal loans, credit cards and auto loans The bank has added 8 ATM machines since end 2012. Branch count has been maintained as we promote our channel optimization strategy Balance Sheet Trends AED billion +20% 93.6 87.9 75.4 66.1 24.3 19.1 18.8 20.2 Revenue Trends AED million +12% 4,385 3,918 +6% 3,716 3,322 1,246 1,006 1,120 940 2,912 3,139 2,382 2,596 2010 2011 2012 Q3 13 2010 2011 2012 Q3 13 YTD YTD Loans Deposits NFI NII 28#29Islamic Banking Global Markets & Treasury Divisional Performance (cont) Emirates NBD Total income at AED 332 million in Q3 2013 YTD declined from AED 548 million in the same period last year • Net interest income improved in Q3 2013 compared to Q2 2013 due to increased hedging income as Bank took advantage of recent swap rates rise to hedge some positions • This is offset by lower non-funded income mainly from trading desk which faced challenges during Q3 2013 due to market volatility caused by US Fed's decision to defer quantitative easing. Sales desk continued to show healthy revenue growth on demand for foreign exchange and interest rate hedging products. Revenue Trends AED million -22% Net Revenue Trends AED million -22% 528 701 701 678 678 332 528 959 623 682 332 489 78 -3 -157 -431 2010 2011 2012 Q3 13 YTD 2010 2011 2012 Q3 13 YTD NFI NII Income . 25.3 Islamic Banking revenue improved +38% y-o-y (from Q3 2012 YTD to Q3 2013 YTD; net of customers' share of profit) Financing receivables were largely unchanged at AED 23.2 billion from end 2012 Balance Sheet Trends AED billion Revenue Trends AED million +99% 0% 29.2 28.3 26.9 1,187 1,100 • Customer accounts rose by 5% to AED 28.3 billion from end 2012 22.8 23.3 23.2 +5% 261 244 767 15.9 61 595 At end Q3 2013, branches totaled 50 while the ATM & SDM network totaled 179 927 856 706 667 -72 2010 2011 2012 Q3 13 2010 2011 2012 Q3 13 YTD Financing Receivables YTD Customer Accounts NFI NII 29#30Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy Outlook Appendix Emirates NBD 30 30#31Emirates NBD has a focused longer-term strategy built on 5 core building blocks 1 Deliver an excellent customer experience 3 4 Drive core business Run an efficient organization 2 Build a high performing organization 5 Emirates NBD Drive geographic expansion 31#321 2013 Strategic Priorities Deliver an excellent customer experience Emirates NBD Continuous Group wide Current Service Excellence Program, e.g. end to end process optimization to improve turn-around times, etc. • Further improvement of convenience and ease of access, e.g. through enhancement of mobile banking offering • Active management of social media to drive customer service 2 3 Build a high performing organization Drive core business • Continue to drive Nationalization efforts • Run Group wide Employee Engagement Program . Roll-out of Wholesale Banking strategy, e.g. enhanced key account planning process involving Corporate, Retail Banking, Treasury and Wealth Management • Further build-up of CASA book through strong Retail franchise • Continuous focus to grow underpenetrated areas like SME business and Wealth Management Leverage new partnerships, e.g. collaboration with Porsche Financial Services to grow auto loan business in the region 4 Run an efficient organization • Ongoing organizational review and streamlining of organizational set-up • Completion of IT lean transformation • Continuous performance transformation of back office functions in Tanfeeth 5 Drive geographic expansion • Ongoing organic growth in KSA, UK and Singapore with additional focus of opening Rep Offices in selected markets • Integration of BNP Paribas operations in Egypt 32#33Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy Outlook Appendix Emirates NBD#34Outlook Emirates NBD Economic Outlook . • . • • We have revised up the 2013 GDP forecast for the UAE to 4.4%, on the back of higher than expected oil output year-to-date, as well as strong expansion in the non-oil private sector. We expect GDP to grow by a further 4.1% in 2014 We retain our 2013 growth forecast of 3.9% for Dubai. Continued expansion in the trade and hospitality sectors as well as a continued recovery in real estate and business services should support broader business activity. Official inflation is likely to remain low in 2013, averaging around 1.5% before rising to 3% somewhat into 2014. Emirates NBD is well placed to take advantage of the strong continued growth in Dubai Capitalisation and liquidity continue to be extremely strong, offering resilience and flexibility for the future Conservative provisioning, de-risked and strengthened balance sheet offers strong platform for capturing future growth opportunities • The Bank has a clear strategy in place and is focused on relentless execution 34 34#35Summary Emirates NBD Profitability Provisions · Pre-impairment operating profit improved 8% q-o-q and 16% year-to date compared to Q3 2012 YTD • Net profit of AED 2,584m YTD improved 34% compared to Q3 2012 YTD • Continued conservative provisioning with net impairment allowances up 11% year-to date to AED 3,400 million • Total income improved q-o-q and YTD by 8% and 13% respectively Income Net Interest Margin • YTD NIM rose 0.14% to 2.56% helped by increased volumes in higher yielding retail products, a fall in EIBOR rates, cheaper bank borrowings and a more efficient capital structure • Cost to Income ratio has improved to 33.0% for Q3 and to 33.6% YTD CI Ratio • NPL ratio improved by 0.2% since start of year to 14.1% Credit Quality Capitalisation and Liquidity Outlook • Coverage ratio improved by over 5% since start of year to 54.8% Capitalisation and liquidity extremely strong offering resilience for the future • Tier 1 ratio improved by 1.1% since start of year to 14.9% • Emirates NBD is well placed and has a clear strategy in place to take advantage of the improving growth outlook 35#36Contents Operating Environment Emirates NBD Profile Financial and Operating Performance Strategy Outlook Appendix Emirates NBD#372013 Awards Emirates NBD Emirates NBD named UAE's "Best Foreign Exchange Provider 2013" by Global Finance • Emirates NBD Asset Management named 'UAE Asset Manager of the Year' at MENA Fund Manager Awards 2013 • Emirates NBD Securities has been declared as "Winner of NASDAQ Dubai's Retail Broker of the Month Award for February 2013" • Emirates NBD named 'Best Retail Bank in the UAE' by the Asian Banker • Emirates NBD wins 'eBanking 2013 Excellence Award' for best mobile banking application at the 18th Middle East e-Government and e-Services Excellence Awards • Emirates NBD named "Best Bank in UAE" by Euromoney • Emirates NBD awarded for 'Best Customer Service Research Programme' in the UAE • Emirates NBD won Best SME Internet Banking Service' award by Banker Middle East 37#382013 Awards (cont) Emirates NBD • Emirates NBD won bronze award for best sponsorship of Omega Dubai Desert Classic • Emirates NBD wins 'Best Corporate Card Award' for two consecutive years at the 'Smart Card Awards Middle East - 2013' • Emirates NBD wins Visa LEADER Award as 'The Best Issuing Institution in MENA' at the Visa APCEMEA 2013 Security Summit • Emirates NBD Asset Management named Best Regional Fund Manager at Banker Middle East Industry Awards Emirates NBD wins "Best Sales Program" at INSIGHTS Middle East Call Centre Awards • Emirates NBD ranked No. 1 Bank for Investment Advice across MENA in the September issue of FTSE Global Markets • Emirates NBD Asset Management named 'Best Asset Management Company' at the annual Arab Achievement Awards 2013 • Emirates NBD wins "Best Borrower in the ME" by Euroweek 38#39Large Deals Concluded in 2013 March 2013 March 2013 June 2013 Emirates NBD Apr 2013 AKLease USD 90,000,000 and EUR 30,000,000 CLUB LOAN FACILITY Mandated Lead Arranger Emirates NBD A Alfa Bank USD 350,000,000 CLUB LOAN FACILITY Mandated Lead Arranger and Bookrunner Emirates NBD BANK ASYA USD 230,500,000 and EUR 115,300,000 SYNDICATED DUAL CURRENCY MURABAHA FINANCING FACILITY Initial Mandated Lead Arranger and Bookrunner Emirates NBD THE INTERNATIONAL BANK OF AZERBAIJAN USD 37,500,000 and EUR 69,000,000 DUAL CURRENCY TERM LOAN FACILITY Initial Mandated Lead Arranger and Bookrunner Emirates NBD December2012 شركة سعودي اوجيه المحدودة SAUDI OGER LTD. USD 1,030,000,000 SYNDICATED TERM LOAN FACILITY Initial Mandated Lead Arranger and Bookrunner Emirates NBD June 2013 INVESTMENT CORPORATION OF DUBAI USD 875,000,000 and AED 6,152,275,000 CONVENTIONAL AND ISLAMIC FINANCING FACILITIES Initial Mandated Lead Arranger and Bookrunner Emirates NBD June 2013 June 2013 SBERBANK Şekerbank S By your side USD 300,000,000 TERM LOAN FACILITY Mandated Lead Arranger and Bookrunner Emirates NBD USD 70,000,000 AND EUR 52,000,000 DUAL CURRENCY TERM LOAN FACILITY Mandated Lead Arranger and Bookrunner Emirates NBD#40Large Deals Concluded in 2013 (cont) Emirates NBD June 2013 Turkey's Finance Türkiye Finans USD 426,000,000 AND EUR 57,000,000 SYNDICATED DUAL CURRENCY DUAL TRANCHIE MURABAH FINANCING FACILITY initial Mandated Lead Arranger and Bookrunner Emirates NBD June 2013 TÜRK TELE KOM USD 300,000,000 TERM LOAN FACILITY initial Mandated Lead Arranger and Bookrunner Emirates NBD April 2013 Zain USD 700,000,000 REVOLVING CREDIT FACILITY initial Mandated Lead Arranger and Bookrunner Emirates NBD Sep 2013 alBaraka USD 196,000,000 AND EUR 175,500,000DUAL CURRENCY MULTI TRANCHE SYNDICATED MURABAHA FINANCING FACILITY Co-ordinator, Initial Mandated Lead Arranger and Bookrunner Emirates NBD ATLANTIS THE PALM ASYA KATILIM BANKASI A.Ş. EMAAR PROPERTIES PJSC BANK OF CEYLON ATLANTIS THE PALM, DUBAI BANK ASYA BOC ලංකා බැංකුව Forth salis EMAAR USD 880,000,000 SYNDICATED TERM LOAN FACILITY AUGUST 2013 USD 65,000,000 MURABAHA FINANCING FACILITY SEPTEMBER 2013 USD 200,000,000 SYNDICATED TERM LOAN FACILITY JULY 2013 USD 500,000,000 MURABAHA FINANCING FACILITY SEPTEMBER 2013 Initial Mandated Lead Arranger and Co-ordinator Sole Arranger and Bookrunner Emirates NBD Emirates NBD Sole Initial Mandated Lead Arranger and Bookrunner Emirates NBD Mandated Lead Arranger Emirates NBD#41Large Deals Concluded in 2013 (cont) MAJID AL FUTTAIM HOLDING LLC MICROSOL INTERNATIONAL THE INTERNATIONAL BANK OF AZERBAIJAN THE INTERNATIONAL BANK OF AZERBAIJAN ماجد الفطيم MAJID AL FUTTAIM microsol™ USD 120,500,000 SYNDICATED MURABAHA FINANCING FACILITY JULY 2013 USD 1,159,000,000 AND AED 1,609,000,000 REVOLVING CREDIT FACILITY SEPTEMBER 2013 AED 117,000,000 CONVENTIONAL AND ISLAMIC FINANCING FACILITIES JULY 2013 STANFORD MARINE GROUP SMG STANFORD MARINE GROUP Emirates NBD USD 255.000.000 AND AED 165,307.500 CONVENTIONAL AND ISLAMIC FINANCING FACILITIES AUGUST 2013 Co-ordinator, Initial Mandated Lead Arranger and Bookrunner Emirates NBD Mandated Lead Arranger, Bookrunner & Documentation Agent Emirates NBD Initial Mandated Lead Arranger Emirates NBD Initial Mandated Lead Arranger, Book runner and Underwriter Emirates NBD YES BANK YES BANK USD 180,000,000 AND EUR 58,000,000 DUAL CURRENCY MULTI TRANCHE SYNDICATED TERM LOAN FACILITY SEPTEMBER 2013 Mandated Lead Arranger, Book runner and Coordinator Emirates NBD#42Investor Relations PO Box 777 Emirates NBD Head Office, 4th Floor Dubai, UAE Tel: +971 4 201 2606 Email: [email protected] Emirates NBD 42