1H 2024 Financial Results Briefing

Good morning everyone. Thank you for joining us at Seattle eyes first half 2024 financial results briefing I'm Grace Chan head of investor relations a very warm welcome to our analysts members of the media Our finances here at Capital Tower as well as those joining us via webcast now if you had time to look at our announcement this morning You will know that our team in China and our team in the USA have been working really really hard They've been racing just like the atlix ideal Olympics team USA team China Bring us good news this morning. So without further ado our invites our group COO To share opening remarks and to share what the teams have been up to Andrew, please

Thanks Grace good morning everyone. Thanks for joining us again Banking partners capital partners stakeholder's value partners all around first half 2024 briefing When we started the year if you remember for those of you who were with us at the start of the year We outlined three priorities and they're all concerned capital first of the priorities was capital formation The second priority was capital recycling and the third priority was capital rebalancing So I'll use a few minutes this morning before I turn it over to Paul to take you through the performance numbers to just run through Where we think we are on these three priorities at the halfway point for 2024 So first off capital formation

It's been a tough year capital raising all around I was looking in at the PRE numbers for first half globally. It's the lowest since 2012 so over 10 years of capital raising tracking data. This is the lowest in 12 years globally is about 60 billion Dollars and all that Asia is about five billion allocated for Asia If you compare it to where we were Where we are this year today. We're about 10% of that five billion allocated So Not bad. Okay. We are punching. I would say add or slightly above our weight. I just wanted to give you some context on Capital raising is a whole If you think about Where that money is going

90% of the capital raise globally is going into two sectors living and industrial And off the different strategies the majority of the capital is going to value add and this understandable right So I think back again to what we've been doing this first six months of the year Four of the five funds that we accepted and raised are in these strategies so Setting the context We are listening to investors And I think and we are confident that we are doing everything we can to punch at or above our weight In terms of capital formation Not understanding the fact that this is very difficult challenging environment. We're still in 12 years If I look across the

other fee earning verticals that we have and Paul will take you through this in a few minutes I think we're doing okay Platforms are doing well Loging management stronger on your growth high single digit commercial management stronger on your growth sink high single digit Public funds flat Cause by event driven which I think again understandable given where rates are and the challenge for core product in particular To formulate capital and go on raise capital and deploy But I think things are turning the corner. I think we all agree widely consensus view is that rates have peaked And if they start to now moderate back down to a higher for longer but a more moderate normalized rate That should open the window for core product to begin to

Go out and formulate capital again and deploy So overall capital formation. I think our fee income business 4% Padme growth year and year Was that right? I think about 4% I think that's a credible number In the context of what I've shared Let's turn to number two which is capital recycling. Okay. This one. We were very clear. I think at the start of the year We came out to say We want to prioritize capital recycling over potentially Making sure we sell at the absolute highest point of the asset value because we appreciate the importance of capital recycling in this context Why is capital recycling important? We want dry powder for what we think is coming?

We want to see new product. We want to pay down expensive debt and we want to potentially buy back shares So for these four reasons capital recycling takes priority Maximizing portfolio gain and again if you look at our first-time results as Paul will share with you We are roughly two X of where we were same time last year So I think we're just over 1.5 billion in total value gross value recycle So we passed the half way mark of our annual three billion target and I think we are confident We'll get there by the end of the year. So this is a marked improvement from where we were last year when Literally the marketplace was dead Right, so that's again another promising sign that we are starting to get back to our run rate

Where we switch we have set for ourselves Lastly, let's look at capital rebalancing Our story to our stakeholders has always been we want to be a diversified capital manager We see value in being diversified and Asia is a heterogeneous Marketplace and that's where I think our strengths really come to the fore When we set ourselves out we have three core markets India China Singapore The way capital land has evolved over time. We have two of those three markets are large China and Singapore We find ourselves currently in this de globalized multi polar system that I think is going to stick around for a while

It just drives from the fact that diversifying our business is even more important these days You can't rely on any one market To give you Supernormal or the types of returns that you may have been used to in the past because things evolve so quickly The world is is incredibly uncertain and if you put all your eggs or too many eggs in one basket you run a This proportionate risk that you may get yourself into trouble So it only serves to drive home our priority. We want to increase the diversification of our portfolio and our business And again if I go back to the point of Looking about two core markets where we have a higher than I would say in normal exposure. They're Singapore and China

If I ask for a show of hands which one concerns you guys more. I don't think We need to do that right? So with China, I think we're clear we Want to better we achieve a better balance in our exposure to China Now you can do this in two ways you can directly reduce the China exposure Or you can raise everything else outside of China. So Asia ex-China. Let's call it Of these two strategies we much prefer the latter Okay, that's and we have a specific strategy for China which I will touch on slightly and I think most of you know it already And that is China for China But for China for Asia ex-China It is I would say priority number one for us now

We've acknowledged that we are underway in key Asian markets like Japan, South Korea, Australia And so going forward And Chikun would touch on this in a bit in a minute It is incredibly important that we execute on on this in order to achieve better capital rebalancing otherwise We will fail in our commitment to assure all this Again, it is illustrative that four of the five new funds that we accepted first half are all in these markets Right Korea Southeast Asia Japan Hopefully there will be more to come in other markets around Asia such as Australia So the priority on capital rebalancing is absolutely to grow Asia ex-China