Financial Results for 1Q08

Transcription

1 Financial Results for 1Q2008 Kick-Start of Business Rebuilding Warsaw, May 9, 2008 Page 1

2 Executive summary Macroeconomic situation financial results Appendices Loan book overview Business development Page 2

3 Financial Highlights Continued business only IFRS consolidated data in PLNm 1Q07 / 1Q07 Net interest income % Net F&C % Net trading result Total net revenue* % Costs /169** 48%/14%** Other operating result % Impairment charges % Pre-tax profit % Net profit % B/S changes in (in PLNm) 8% deposits to 6,055 (from 5,621) 5% loans to 6,501 (from 6,165) 5% equity to 1,551 (from 1,473) 3% assets to 12,604 (from 13,027) ** Excluding impact of Cost Allocation in 1Q07 Total net revenue=nii+net F&C+Net trading result+net income from investments; Deposits=Amounts owed to customers; Loans=Net loans and advances to customers Page 3

4 Efficiency Ratios (%) ROE pre-tax 0.0 pp ,3 19,3 Loans/ Deposits 3.0 pp ROE net 1.3 pp ,4 12,1 Loans/ Assets 5.0 pp ,5 0 2 ROA net 0.1 pp ,4 1,5 Margin 1.3 pp ,79 3, CIR 6.8 pp ,9 71,8 Net profit/ FTE (PLNths) 2.5% ,0 56,4 ROE net = net profit to av. shareholders equity; ROE pre-tax = pre-tax profit to av. shareholders s equity; ROA = net profit to av. assets; CIR = general administrative expenses/ (total net revenue + other operating result); Margin = NII to av. total assets Page 4

5 Bank BPH Key Statistics as at end-march 2008 Branch Network Density by Voivodship Key data 2007 Outlets Partner outlets 0 20 Own ATMs* Employees (FTEs)** 3,172 3,422 Retails Clients, including ( 000): Private Individuals Small Enterprises Corporate Clients*** Retail banking cards, including ( 000): Credit cards**** Debit cards Charge cards Employment structure (FTEs) Outlets, incl.: - Front office - Back office - Management of outlets Credit Analyzes and Collection Centers Corporate Centers and Corporate Macroregions Head Office Brokerage Office House Savings and Loan Office 18 Zachodniopomorskie 6 Lubuskie 1, 817 1, , Poznan 7 Dolnoslaskie 16 Pomorskie 11 9 Wielkopolskie Gdansk/Gdynia/Sopot 6 Lodzkie Kujawsko- Pomorskie Warminsko- Mazurskie Mazowieckie Podlaskie Lubelskie 5 5 Opolskie Katowice / Swietokrzyskie Silesia Krakow 11 Slaskie 17 Podkarpackie 32 Malopolskie 4 34 Warsaw (1) Regional GDP per capita (in % of Polish average); Source: Company data, Central Statistical Office 7 12 <80%(1) 80%-95%(1) 95%-105%(1) 105%-120%(1) >120%(1) Number of outlets Page 5 *Bank BPH customers have free of charge access to more than 3,200 ATMs (including 1,249 of EuroNet and all Pekao machines); **Without unpaid, maternity and child care leaves; ***Bank started to acquire Corporate Clients from 30 Nov i.e. immediately after spin-off; ****Active cards only

6 Legal Background Behind: Spin-off legally effective November 29, 2007 Financial settlement of spin-off finalized February 29, 2008 GE Money filing with KNF Ahead: KNF approval for GE Money to take control over Bank BPH Acquisition of Bank BPH by GE Money up to few weeks after KNF approval Completion of BPH285 migration to Pekao end of May, 2008 Integration with GE Money Bank by end of 1H2009 Page 6

7 Executive summary Macroeconomic situation financial results Appendices Loan book overview Business development Page 7

8 2008 GDP Growth Forecast Still Above 5% 9 0 GDP (%, y/y) 6,9 6,0 4,8 4,0 2,4 4,3 3,2 5,4 6,3 4,4 6,6 6,6 7,3 6,5 6,5 6,3 5,8 E 4Q07 3Q07 2Q07 1Q07 4Q06 3Q06 2Q06 1Q06 4Q05 3Q05 2Q05 1Q05 4Q04 3Q04 2Q04 1Q04 7,75 0,5 Private consumption (%, y/y) 5,15,3 4,4 2,7 2,52,5 1,4 1,6 5,0 4,4 5,2 4,7 6,9 5,0 5,1 3,7 5,6 E 4Q07 3Q07 2Q07 1Q07 4Q06 3Q06 2Q06 1Q06 4Q05 3Q05 2Q05 1Q05 4Q04 3Q04 2Q04 1Q Investments (%, y/y) 8,6 4,84,95,3 10,19,0 6,4 3,9 1,2 15,9 18,0 16,6 26,2 20,8 17,6 18,3 16,4 E 4Q07 3Q07 2Q07 1Q07 4Q06 3Q06 2Q06 1Q06 4Q05 3Q05 2Q05 1Q05 4Q04 3Q04 2Q04 1Q04 perc. points (contribution to GDP growth) Contribution to GDP growth net exports inventories investments public consumption private consumption GDP -3 1Q04 3Q04 1Q05 3Q05 1Q06 3Q06 1Q07 3Q07 Despite global economy slow down, pace of economic growth in Poland will stay above 5% in 2008 (5.8% for ) Domestic demand: consumption and investments still driving economic expansion All figures reported as quarter average (unless stated otherwise) Page 8

9 Ever Increasing Inflation Inflation (%, y/y) and 1M WIBOR ,9% 6,5 3,6 5,6 2,3 1Q05 2Q05 19,6% 4,7 4,6 4,3 4,1 1,6 1,1 19,4% 4,1 NPL in commercial banks (share %)* 13,6% 10,1% 6,8% 4,9% ,1 0,6 0,8 1,4 1,4 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 4,1 2,1 Inflation 1M WIBOR 4,3 4,8 5,2 5,6 2,4 2 3,5 4,1 1Q07 2Q07 3Q07 4Q Corporate and household loans (%y/y, quarterly averages) Corporate Household 38,8 38,3 37,7 37,3 40,2 24,2 29,5 31,6 25,5 16,1 21,5 23,1 23,7 20,3 25,0 20,1 19,2 12,1 4,3 15,3 1,3 4,0 8,6 1,7-0,5-4,5 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 Q307 Q Corporate and household deposits (%y/y, quarterly averages) 29,9 24,2 26,0 22,9 21,0 16,8 23,0 22,3 17,8 15,2 19,9 21,5 11,7 15,7 9,3 4,5 8,5 7,8 9,7 8,3 5,3 8,6 5,0 6,9 8,6 8,3 1Q05 2Q05 Corporate 3Q05 4Q05 1Q06 2Q06 3Q06 Household 4Q06 1Q07 2Q07 3Q07 4Q07 CPI to reach its peak in 3Q08, but monetary policy tightening cycle close to end our expectations: interest rates to be hiked to 6.00% Corporate loans revival to continue in 2008 Household loans growth still exceeding 35% */ according to NBP Page 9

10 Executive summary Macroeconomic situation financial results Appendices Loan book overview Business development Page 10

11 Revenue Side vs. 1Q PLNm Total net revenue 46,8 198,5 1Q07 Net interest income -1,0-10,2 +18% Net F&C Trading result 1,0 Net income from investments 234,6 95% 45% -5% 0,0% 1,5% 44,5% 54,0% 1Q07 0,4% 37,2% 65,6% -3,3% Net income from investments Trading result Net F&C Net interest income 18% growth (or PLN 36m) of net revenue driven by: 44% jump of net interest income mainly on higher loan and deposit base 1% deterioration of net F&C i.a. due to higher costs of domestic payments Net trading result without interest income on trading positions booked in NII; economic trading result equal to PLN 5.5m Net F&C coverage (%) 1Q07 of general costs of remuneration costs All data consolidated and pro-forma 1Q07 (spin-off adjusted) unless stated otherwise Page 11

12 Cost Side vs. 1Q PLNm 0 Costs (incl. depreciation) ,1 130,2 14,5 2,0 4,0 2, % or +13.7% without Cost allocation impact 1Q07 Personnel Building maintenance & rents Other expenses Depreciation 39,1 Allocation of costs* 192,4 Impairment charges 1Q07 1Q ,7-13, Total costs up by 47.8% or 13.7% excl. positive impact of Costs allocation * recognized only until spin-off Personnel expense up by 21% due to i.a. key staff retention, bonuses and base salary upgrade as well as recruitment of new personnel (FTE number up by 250 in Q1) Page 12 *referring to transactions between continued and discontinued operations defined by internal cost allocation system introduced in relation to spin-off

13 Assets Structure vs. end-2007 PLNm Assets 0 13,027 12, % net loans* trading assets dues from banks investments financial assets other Loans 100% 1% 1% 0% 1% 73% 70% 50% 26% 28% 0% Organiz. Related Party Corporate Private Individuals SME *Net loans and advances to customers 3% drop of assets as a result of: (i) closing short term liquidity buffer and consequent shrinkage of investment financial assets (-45%) and (ii) decrease of other assets (-35%) not fully offset by higher loans (+5%) and dues from banks (+38%) Retail loans dominating total loan portfolio Share of PLN denominated loans up to 64% Page 13

14 Liabilities Structure vs. end-2007 PLNm Liabilities Deposits 100% 0% 3% deposits* dues to banks evidenced by certificates shareholders' equity other 50% 0% 73% 74% 27% 23% Corporate Private Individuals SME * Amounts owed to customers 62% reduction of dues to banks following i.a. closing of short term liquidity buffer Almost 8% (or PLN 434m) upturn in deposits Page 14

15 Executive summary Macroeconomic situation financial results Appendices Loan book overview Business development Page 15

16 Loan Book Break-down by Segment And Currency end-march 2008 vs. end-2007 PI excl. Mtg 12% (vs. 14%) 100% 35% 33% Residential mortgages 58% (vs. 59%) SME 28% (vs. 26%) 3% 3% 62% 64% Organiz. Related Party 1% (vs. 1%) Corporate 1% (vs. 0%) 0% PLN EUR CHF Page 16 Loan portfolio for Bank BPH stand-alone = utilized loans + guarantees; PI Private Individuals; SME Enterprises with up to PLN 10m annual turnover (within Retail Division)

17 Impaired Loan Portfolio Impaired loans (% of total loans) Provisions (% of impaired loans) 12% 11,2% 9,9% 70% 68% 69% 69% 67% 67% 6% 5,2% 5,0% 65% 65% 3,1% 3,1% 0% Total PI SME 60% Total PI SME Loan portoflio for Bank BPH stand-alone Page 17

18 Loan Portfolio by Products end-march 2008 vs. end-2007 PI (excl. Mtg): PLN 0.8bn (vs. PLN 0.8bn) Cash Loan 59% (vs. 58%) Residential Mortgages: PLN 3.8bn (vs. PLN 3.6bn) Other 15% (vs. 15%) Real Estate Loan 54% (vs. 54%) Card 16% (vs. 17%) Personal Overdraft 22% (vs. 22%) Other 3% (vs. 3%) Constr. Loan 32% (vs. 31%) SME: PLN 1.8bn (vs. PLN 1.6bn) Investment Loan 31% (vs. 34%) Mortgage 14% (vs. 14%) Other 5% (vs. 6%) Corporate*: PLN 0.15bn (vs. PLN 0.06bn) Mortgages; Guarantees; 0,1% 1% Revolving loans; 63% WCL* 26% (vs. 26%) Overdraft 24% (vs. 20%) Multipurpose line; 36% Loan portoflio for Bank BPH stand-alone Page 18 *Including Organizational Related Party

19 Retail Business Development Total Sales PLN bn PLN bn Retail loan volumes Retail deposit volumes** Margins (%): Margins (%): ,4 6,1 5,6 +15% ,8 6,0 5,1 +34% 3 3 1Q07* 4Q07 Market shares (%): Market shares (%): 1Q07* 4Q Growth in cash loan sales of Pożyczka od Ręki (+23% y/y to PLN 0.44 bn), while total cash loan portfolio up by 13% y/y to PLN 0.50 bn Focus on structured investment products (SCD) Financial Results for 1Qs 2008 Page 19 *1Q07 post spin-off pro-forma **including SCD (in Bank BPH b/s)

20 Number of Retail Customers per Products as at end-march 2008 in ths PI in ths SME Total loans Consumer loans Mortgages Credit cards* Personal accounts Deposits Total loans WCL* and debits Investment loans Other loans Harmonium packages Deposits *Active cards only *Working capital loans Financial Results for 1Qs 2008 Page 20

21 Retail Business Development Investment Products 9,0 PLN bn BPH TFI assets 8,0 7,0 6,0 5,0 4,0 3,0 2,0 1,0 6,9-28.7% 6,5 5,0 0,0 1Q07 4Q07 BPH TFI assets down by -PLN 2bn vs. March 07 due to global slump on equity markets BPH TFI market share of 4.5% Five issues of structured deposits (PLN 0.34bn sales) Top Dywidenda (April May 07), Top Dywidenda 2 (July 07), Lokata Indeks Plus (Aug.- Sept. 07), Lokata Stabilne Akcje (Oct.-Nov. 07), Lokata na Bank (Feb-Mar 08) Financial Results for 1Qs 2008 Page 21

22 Retail Business Development RORs and Term Deposits (new customers acquisition) ROR accounts for PI % 300 1Q07* 4Q07 c.a. 2.5% market share Growth of ROR packages: ths y/y 55.4% share of color** packages (+4.1 pp. y/y) Growth of PI deposit volume (+42% y/y) Financial Results for 1Qs 2008 Page 22 *1Q07 post spin-off pro-forma **Silver, Gold, Max, Private Banking

23 Retail Business Development Credit Cards & Alternative Distribution Channels Credit cards* 80 31% PLNm Credit cards transaction volume % Q07 4Q07 0 1Q07* SME and PI (in 000) 1Q07* 4Q07 Internet banking % Call center** % Financial Results for 1Qs 2008 Page 23 *Active cards only **incl. transactional services

24 Retail Business Development Harmonium & Quick Loans for SME 000 Harmonium packages % 0 Financial Results for 1Qs 2008 Page 24 1Q07* 4Q07 More than 86% of SME customers using Harmonium packages New e-harmonium package launched cheapest on the market Deposit base enhanced (+7% y/y) Growth of loans for SME: 25% y/y (to PLN 1.84bn) *1Q07 post spin-off pro-forma

25 Retail Business Development Mortgage Lending PLN bn Residential Mortgages PLN share +12% 3,65 3,77 100% As at Total PLN FX Av. maturity* 19.1 years 16.5 years 21.1 years 3,35 41,1% 42,7% 27,4% 3 1Q' Market shares (%): % 0% Av. amount** (in PLN 000) Av. LTV*** 50% 58% 45% NPL 2.2% 2.5% 1.9% Portfolio growth dynamics (March 08/ March 07) 12% 75% -11% *contractual maturity; **loans granted in 1Q2008 with only small portion of FX loans; ***current LTV adjusted to mortgage collaterals revaluation Sale of mortgage loans higher by 5% in vs. 4Q07 Page 25 *1Q07 post spin-off pro-forma

26 Corporate Banking Ambitious Strategy Re-establishing of Corporate Centers network throughout the country: 8 Centers already operational for all 10 Centers planned to be opened by end-2008 Human capital and resources being restored Pre spin-off product and service quality retained - most of products already in active sales Customer portfolio to be gradually rebuilt new corporate customers served at the end of 1Q (revised plan to have over 1,200 customers at end-2008) Volumes (in PLNm) Loans Deposits March 31, Q average Page 26

27 Corporate Banking - Transactional Banking Cash Management TransKasa: recent cooperation agreement with Kolporter: B2C services enabling collection of utility payments (by over 80 country-wide billers) at press-rooms and shops; TransKasa installed in ca. 1,000 Points of Sale (POS) all over the country Corporate Customers Service: BusinessLine servicing ca. 300 clients Electronic Banking BusinessNet sales increase: currently customers in place 0 BusinessNet monthly growth I II III Page 27

28 INM Business Development Sales margin from treasury products for Corporate and Retail segments* 100% 1Q'07 +36% 136% 1Q'08 * results from sales of treasury products and custody services generated by INM Division are presented entirely in the results of Retail and Corporate segments 43% y/y growth of sales of structured investment products for Retail Clients in 36% y/y increase of net income from sales of treasury products (incl. fixed income) for Retail/ SME, Corporate and Financial Institutions Clients in 1 st place of Research Team in macro-economic ranking of Parkiet Daily in Focus on rebuilding INM/ Treasury Sales and implementation of new products for Corporate and SME segments Introduction of business model for sales of financial market products and services in Retail/ SME, Corporate and Financial Institutions segments 1 st Place in macroeconomic ranking Jan-Mar 2008 PLN 86m of Structured Investment Products Originated Jan-Mar 2008 Financial Results for 1Q2008 Page 28