1417346953660 MGEC Investor Presentation-IR

8/9/2019 1417346953660 MGEC Investor Presentation-IR

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October 2014

Mubadala GE Capital

Strictly Private and Confidential


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Unique Investment Opportunity

Unique investment opportunity in an

investment grade commercial financecompany with a global mandate

Sound Business Model,Externally Validated

Highly Rated and CommittedShareholders

Consistent Deal Flow from GECapital

Robust Underwriting andSound Asset Quality

Strong Credit Fundamentalsand Profitability

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3

4

5

1

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31%

14%

14%

13%

8%

7%

4%3% 2%

4%Manufacturing

Commercial Real Estate

Health Services

Other ServicesWholesale Trade

Business Services

Transportation & Com.

Mining

Construction

Others

Mubadala GE Capital (“MGEC”) Overview

• 50/50 commercial finance JV between Mubadala andGE Capital, established in 2009

Cornerstone of major strategic partnership betweenMubadala and GE spanning aviation, energy andindustrial sectors

Headquartered in Abu Dhabi, liaison offices in the UKand US

Change of control covenant triggered at 50% ifshareholders cease to own directly or indirectlyshares of MGEC

• Secondary investor in senior-secured commercial loansand leases to middle-market companies through GECapital

• Diversified, multi-asset class approach with globalmandate

• Strong credit fundamentals, consistent profitability,robust risk management, strong capitalization andliquidity

1H’14

RatingsMoody’s

Baa2Stable

FitchA

Stable

Total Assets $4.1Bn

Net Income $63M

Liquidity1 $1.85Bn

Capital Ratio 21%

Employees 65

Portfolio by Industry as of 1H’14

21) Includes liquidity lines obtained post 1H’14 of which $200M was drawn as of 23 Oct’14


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Highly Rated and Committed Shareholders2

Consistent Access to Deal Flow from GE Capital3

Robust Underwriting and Sound Asset Quality4

Strong Credit Fundamentals and Profitability5

Sound Business Model1

50/50 JV – cornerstone of a 5 year partnership between Mubadala and GE Capital, leveraging expertise and brand

Shareholders have supported MGEC via equity, shareholder loans and liquidity facilities

Access to attractive asset classes from GE Capital’s market leading businesses

Leveraging GE Capital for expertise, systems, relationships, embedding locally

Strong and deep credit risk culture across GE Capital implemented at MGEC

Diversified asset base, minimal write- off’s, high and prudent capitalization levels, capacity for profitable growth

A by Fitch and Baa2 by Moody’s - stable outlook

Strong track record in generating attractive risk-adjusted returns

Executed several financings with 11 top tier international and regional banks and continue to diversify our funding sources

Profitable operations, successful track record of execution

Diversified, multi-asset class approach, global mandate

Key Investment Highlights

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Experienced and Proven Management Team

Board of Directors

Holger LaubenthalCEO18 yrs exp.Past: GE Capital,Daimler AG, Bayer,Roland Berger, PwC

Steve RuthCIO27 yrs exp.Past: GE Capital,Bank of America

Ammar AlozaibiChief HR officer15 yrs exp.Past: Tabreed,ENOC, Mubadala

Tolga OzgenCommercialleader18 yrs exp.Past: GE Capital,McKinsey

James HarperMD - Investments15 yrs exp.Past: GE Capital,CSFB

Mike HortonMD - Ops and IT20 yrs exp.Past: GE Capital,GE, JER

Accomplished management team. Prominent figures from MGEC’s shareholders with broad industry , operational andleadership experience

RaviRamanujamCFO15 yrs exp.Past: GE Capital

ShehzaadSacranieGeneral Counsel15 yrs exp.Past: A&O

James PollardMD - Tax18 yrs exp.Past: Dubai Int’lCapital, PwC

Pierre AbinakleChief ComplianceOfficer10 yrs exp.Past: A&O

MichaelMcKinlay

Head of Treasury15 yrs exp.Past: Mubadala,HBOS, Deloitte

1 Sound Business Model,Externally Validated

Ali NajafbagyCap MarketsLeader at MGECand Mubadala12 yrs exp.Past: GoldmanSachs

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Strong Mutual Commitment from ShareholdersMubadala and GE – A unique strategic partnershipHighly rated and committed shareholders that consider MGEC as an integral part of their strategy

Jeff ImmeltGE Chairman of the

Board and CEO

“This partnership brings together two world -class organizations withcomplementary resources and a shared commitment to excellence.Mubadala has deep experience, a diversified portfolio of businesses,access to regional infrastructure opportunities and an exciting vision forgrowth.”

“This partnership is consistent with our global growth initiatives and buildson our long-term relationships in a high-growth region like the MiddleEast.”

“GE constantly sets global benchmarks and is well positioned for

continued success. When we partner, we seek to create value for both parties in multiple ways. This partnership does exactly that.”

“… through this strategic relationship, which has become very strong andclear between Abu Dhabi and GE, there will be bigger and betteropportunities for us… this will certainly expand and develop an alreadystrong relationship.” Khaldoon Al Mubarak,

Mubadala DevelopmentCompany CEO

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2 Highly Rated andCommitted Shareholders


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Strategically Aligned Shareholders

(Aa2/AA/AA) (A1/AA+/-)

Shareholders Overview

1) Mubadala Annual 2013 report2) GE Investor Presentations Q2’14

Long term investor in GE

holding 0.8% of GEshares as of 31-Dec 2013

Power generation –

Emirates Aluminum

GE Abu Dhabi

LeadershipDevelopment Center

Ecomagination Center

Long-term Investor

Global Co-investor

Industry Alignment

Strategic RegionalPositioning

Aviation – Engines &MRO Capabilities

• Leading specialty finance lender with 47,0002

employeesoperating in 50+ countries and over 1M commercial customers

• $514Bn 2 in total assets and over $8Bn of net income in 2013

• Principal investment and development agent in diversifying theUAE economy. Active across 12 industries globally

• $61Bn of assets and over $8Bn of revenues in 2013 1

Global CommercialFinance Partnership

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http://www.mubadala.ae/en/category/about-mubadala/senior-executive-management/


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Strong Shareholder Investment

Senior Shareholder Engagement

MGEC Strategic Relevance to Mubadala & GE Capital

Mutually Beneficial Partnership• $850M equity invested to date

• $400M committed working capital facilityprovided equally by shareholders

• Mubadala’s $750M committed liquidity facility

• GE Capital’s $750M bi-lateral term loan

• MGEC brand and identity includesshareholders’ name

• Prominent members of shareholders seniormanagement serve on the Board of MGEC

Mubadala: − Carlos Obeid, Group CFO− Khaled Al Qubaisi, Chief Human Capital Officer− Derek Rozycki, Head of Corp. Fin. & Treasury

GE Capital: − Rich Laxer, President & CEO GE Capital

International − Aris Kekedjian, Head of Business Development − Peter Herbert, President & CEO Strategic

Ventures Group

• Access to attractive commercial finance assets

• Invest alongside a global industry leader

• Steady income stream with low correlation withMubadala’s overall portfolio

• Access to GE Global Leadership Programs forlocal Emirati talent

• Consistent and reliable funding partner

• Improve GE Capital’s offerings to clients • Aligned with GE Capital global businesses

• Enhance wider GE’s profile in the UAE andMiddle East

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C i D l Fl


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MGEC Aligned with GE Capital Businesses

GE Capital Businesses 1

Commercial Lending And Leasing Verticals

Not in Scope• Credit cards• Personal loans• Mortgages

Consumer

GE CapitalAmericas

$103Bn Assets8k employees

GE CapitalInternational$138Bn Assets27k employees

Real Estate$40Bn Assets

5.6k properties

EnergyFinancialServices

$16Bn Assets

CommercialAviationServices(GECAS)

$46Bn Assets

MGEC’s Selection Criteria

• Exclusively focused on GE Capital originated assets

• Selection of GE Capital businesses driven by

− Extensive due diligence

− Ability to find repeatable & consistent deal flow

− Return thresholds being met

MGEC Driving Consistent Deal Flow

• MGEC focused on

− Reliable & timely responses− Good coverage of GE Capital businesses

− Ability to build relationships across all levels of GE Capital

3 Consistent Deal Flowfrom GE Capital

81) GE Investor presentations Nov’13

R b t U d iti g &


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Robust Underwriting and Risk Management

• Quality portfolio through focus on senior secured structures supported by expertise and rigorous underwriting• Exclusive focus on GE Capital originated assets

Underwriting and Investing Philosophy

Controlled Screening and Underwriting Process

• Receives all informationprovided to 3 rd party lenders

• Receives GE Capital creditpapers and models

• Minimum return threshold

• Key credit parameters

• Due diligence call held with GECapital

• MGEC forms independent view

• Robust IC discussions

• Unanimous approval required

Extensive Industry and Risk Experience to Support Investment Decisions

Preference for obligors that can service capital structure through a cycle and forasset coverage to support strong recoveries

Commercial Team InitialScreening Access to GE Capital Materials

Independent MGECUnderwriting

Investment Committee (“IC”)

• Partner businesses withproven track record

• Unique insights due to GE’sindustrial heritage

• Seasoned professionals,experienced in Risk andCapital Markets

• Breadth of industry and productexpertise

• Senior risk professionalstrained at GE Capital

• MGEC CEO• MGEC CIO• Head of Specialty Finance -

Mubadala• Senior Restructuring Officer –

GE Capital International

Experienced Coverage Team GE Capital Expertise Strong MGEC UnderwritingTeam Senior Professionals

4 Robust Underwriting &Sound Asset Quality

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Robust Underwriting &


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Sound Asset Quality and Diversified Loan Book

1) Gross loan portfolio as of 1H’14 ($3.5Bn) 2) Gross loan portfolio which is neither past due nor impaired. As of H1 2014, 0.3% doubtful loans

Portfolio by Industry 1 Portfolio by Country 1

Breakdown of MGEC’s Loan Portfolio 1

84%

6%

3%

2%

2%

1%

2%

USA UAE UK

Canada Ireland Turkey

Other

Internal Risk Classification 2

Write-off ($M) and Default Rate

• Regular account reviews

• Accounts assigned a riskclassification

• Closer monitoring of accountsclassified Special Mention toDoubtful

• Regular review of portfolio trendsagainst risk limits

4% 6% 7%10% 10% 8%

86% 84% 85%

2012 2013 1H'14Doubtful Sub Standard

Special Mention Pass

• Defaulted loans at 1H’14amounted to $74M (2.1% of grossloan portfolio)

• Loans are senior secured with ahigh expected recovery rate

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5

0.6%

2.8% 2.1%

2012 2013 1H 2014

Write-offs ($M)Default rate (% of total loans)

60%29%

6% 5%Cash Flow Loans

Real Estate Loans

META Loans

Other Loans

31%

14%

14%

13%

8%

7%

4% 3%2%

4%

Manufacturing Commercial Real Estate

Health Services Other Services

Wholesale Trade Business Services

Tra ns po rt at io n & Com. M in ing

Construction Others

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4 Robust Underwriting &Sound Asset Quality

S C di d l d fi bili

5 Strong Credit Fundamentals


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Strong Credit Fundamentals and Profitability

Total Assets ($Bn) 1

• Steady asset growth• New volume and AUM

transfers

Capital Structure ($Bn) 2

• Introducing externalleverage in orderly

manner and maintainingrobust capital

Net Income ($M) andExpense Ratio (%) 3

• Improved cost structurethrough scale

5

70

63

2.2%

1.1%1.0%

2012 2013 1H 2014Net income

Expense ratio

5 Strong Credit Fundamentals& Profitability

1) Loan portfolio includes loans and advances and investment in finance leases2) Risk weighted ratio of 21% as of 1H’14

0.1 0.2 0.3

2.9

3.7 3.5

0.1

0.3

3.1

4.0 4.1

2012 2013 1H 2014Others

Loan portfolio

Cash and cash equivalents

0.7 0.8 0.9

2.42.4

1.7

0.7

0.7 0.5

0.1

0.3

3.1

4.0 4.1

2012 2013 1H 2014OthersSecured borrowingsUnsecured borrowingsShareholders' loansNet Equity

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C i F di d Li idi P fil

5 Strong Credit Fundamentals


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1.20.3

1.3

0.1

12 Month 1 and 5 years 5+ years

External Borrowings Shareholders Loans

Conservative Funding and Liquidity Profile

Source of Liquidity ($Bn)Debt Maturity Profile : 1H’14 ($Bn)

Mubadalaliquidity facility

0.75

Cash andequivalents

0.3

Liquidity $1.85bnSecured 0.5Unsecured 2.4Total 2.9

2.5

5 Strong Credit Fundamentals& Profitability

Funding Profile • Assets partly funded through secured and unsecured borrowings• Shareholder equity and loans are an important part of business

Debt Maturity Profile

• Debt maturity profile broadly matched to behavioral asset life

• Majority of debt portfolio matures between 1 to 5 years• Secured debt facilities managed to self-liquidate by contractual maturity

Liquidity Profile • $1.85Bn of committed sources of liquidity covering $0.75Bn of unsecured external debt maturities$2.4Bn of unsecured debt maturities (including shareholder loans)

As of 1H’14

Externalworking capital

facility1

0.4 0.4

Shareholderworking capital

facility Post 1H’14

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Conclusion

U i I t t O t it


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Unique Investment Opportunity

Unique investment opportunity in an

investment grade commercial financecompany with a global mandate

Sound Business Model,Externally Validated

Highly Rated and CommittedShareholders

Consistent Deal Flow from GECapital

Robust Underwriting andSound Asset Quality

Strong Credit Fundamentalsand Profitability

2

3

4

5

1

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Appendix

MGEC Summary Corporate Structure


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MGEC Summary Corporate Structure

Mubadala GECapital PJSC

(UAE)

MGEC GlobalAssets 3 Ltd(Bermuda)

MGEC GlobalAssets 2 S.a.r.l(Luxembourg)

MGEC GlobalAssets 1 Ltd

(Ireland)

GE Capital(US)

A1 / AA+

Mubadala(UAE)

Aa2 / AA50%

Mubadala GECapital Limited

(Bermuda) 1Issuer Entity

Baa2 / A

50%

100%

Un s e c u r e d De b t I s s u e r

Secured financingsbooking entities

Upstream guarantees Abu Dhabi basedMGEC asset

managerRated group

1) Held indirectly through MGEC Holdings LLC (US)

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1417346953660 MGEC Investor Presentation-IR

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