Bank BPH 2Q 2016 Earnings. Webcast

Transcription

1 Bank BPH 2Q 2016 Earnings Webcast 1

2 Overview of 2Q 2016 In PLN Sale process Agreed and signed the Demerger Plan collected approvals of KNF, UOKiK, Alior Bank s general meeting Alior Bank tender offer for Bank BPH shares Profitability Net income of 68 MM in 2Q gross income of 84 MM positively boosted by Visa transaction Performance Retail loans and commercial limits granted of 2.5 B, up 6% y/y branch transformation plan in progress with good early results Costs Operating costs (excl. one-offs) down 14% y/y and 12% q/q result of business transformation Quality Impairment charges of 42 MM stable level of core risk costs y/y, lower debt sale and recoveries from written-off loans NPL ratio of 7.3% down 0.2 pp. y/y and q/q Safe & sound TCR at 16.8% and Tier I at 13.4% under Basel 3 rules liquidity and market risk maintained at a safe level 2

3 Key transaction milestones Date Milestone Communication from GE - transaction in an advanced stage transaction price not likely to exceed tangible book value trigger to goodwill write-off decision / SPA and pre-demerger agreements signed purchase price for Bank BPH Core Business set at PLN 1,160 MM (adjusted in Aug 16) Demerger Plan agreed and signed by Bank BPH and Alior Demerged Business will be transferred to Alior Bank and Mortgage Business will remain in Bank BPH share exchange ratio Alior/BPH at 0.51 June & July 2016 August Q-4Q 16 Regulatory consents (KNF, Antitrust Authority) Alior Bank general meeting consent Alior Bank tender offer for Bank BPH shares Bank BPH general meeting Shareholding GE Bank BPH Bank BPH after Demerger 100% 50.1% Mono-product operations only mortgage loans no new sales 4Q 16 Expected Demerger and transaction finalization BPH TFI 3

4 Financial performance PLN MM 2Q 16 Mortgage Business 2Q 16 Business for demerger 2Q 16 Total VPQ VPY Business for demerger portfolio (PLN MM, net, average) 7,546 7,661 8,052 8% 8,313 8,188 8,266 Net interest income Net F&C + trading + other Total net revenue 1 Impairment charges RANR 2 Costs Profit before tax One-offs Net result (4%) (2%) (8%) (26%) (5%) (9%) (10) (32) (42) Increase Increase (21%) (22%) (35) (217) (252) (12%) (14%) 11 (50) (39) Decrease Decrease Increase Increase Increase Increase 3,694 3,889 4,111 4,296 4,395 4,416 3,851 3,773 3,941 4,018 3,793 3,850 1Q'15 3Q'15 4Q'15 1Q'16 Commercial 15,546 15,300 15,082 14,877 Retail* Mortgage Business portfolio (PLN MM, net, average) -5% 14,687 14,481 1,582 1,609 1,656 1,717 1,780 1,830 13,964 13,691 13,427 13,160 12,907 12,651 Depreciation 1 MM Visa 95 MM Depreciation 19 MM VAT refund 8 MM Revaluation 7 MM 1Q'15 3Q'15 4Q'15 1Q'16 FX MTG** PLN MTG Positive impact of VISA transaction business for demerger loan portfolio increase 1/ Total net revenue = NII + Net F&C + Net trading income + Other operating income and expenses; 2/ Risk Adjusted Net Revenue = Total net revenue + Impairment charges */ 4 Including credit cards, cash loans, sales finance and auto loans; **/ Constant FX as of 1Q 15 Core 12 August Business 2016 / Mortgage Business financials have been prepared on the basis of estimates and assumptions, a full disclosure of which can be found in the Interim Condensed Financial Statements.

5 Retail performance highlights 997 Total retail sales* (PLN MM) % q/q 42% y/y 574 1Q'16 Investments gross sales (PLN MM) Mortgage loans sales (PLN MM) Q'16 C/A balance (PLN MM, eop) 47% q/q 30% y/y 491 K C/As serviced at end 2Q, up 8% y/y 19 K new accounts in 2Q balance of PLN 2.6 B Powrót odsetek campaign PLN 498 MM cash loans granted in 2Q gross portfolio of PLN 4.4 B, up 12% y/y Transformation of distribution model 40 own branches transformed into partner outlets in 2Q 41 own branches closed 356 8% q/q 50% y/y 2,184 5% q/q 19% y/y 2,475 2, Q'16 1Q'16 Transformation of distribution model in crucial phase impacted retail sales */ Incl.: cash loans, mortgage loans, cards, overdrafts 5

6 Commercial performance highlights Renewals New SME sales* (PLN MM) % q/q 9% y/y Q'16 Factoring turnover** (PLN MM) 10% q/q 1% y/y Corporate sales* (PLN MM) , Q'16 C/A balance (PLN MM, eop) 124% q/q 64% y/y 1,526 2% q/q 7% y/y PLN 2.7 B balance on commercial C/As, up 7% y/y Corporate +6% and SME +8% Commercial clients gross receivables of PLN 4.1 B, stable y/y The value of loans granted or renewed under cooperation with BGK reached PLN 266 MM in 1H Total factoring liabilities of PLN 577 MM in 2Q 50 K invoices ,498 2,639 2,679 1Q'16 */ Limits granted **/ Data includes reverse factoring 6 1Q'16 Solid, growing business

7 Mortgage Business - PLN portfolio key metrics PLN MM Receivables (AVG, gross) 1,839 2,069 NII stable Fees & FX income stable 13% Revenue stable Losses improvement RANR growing Development of good quality PLN mortgage portfolio 7

8 Mortgage Business - FX portfolio key metrics PLN MM Receivables (AVG, gross) 14,129 13,251 NII down 11% Fees & FX income stable 6% Revenue down 10% Losses increase RANR down 33% Stable portfolio in run off 8

9 Non-MTG retail key metrics (for demerger) PLN MM Receivables & deposits (AVG, gross) 4,448 7,273 7,566 4,948 NII Fees & FX income up 3% down 14% 11% 4% Receivables Deposits Revenue Losses RANR stable increase down 28% Strong annual receivables growth 9

10 SME key metrics (for demerger) PLN MM Receivables & deposits (AVG, gross) 2,206 2,320 1,901 1,719 Receivables 1,901 1,834 1,756 1,713 1,719 3Q'15 4Q'15 1Q'16 NII Fees & FX income down 11% down 2% 10% 5% Receivables Deposits Revenue Losses RANR down 8% stable down 6% Focus on high quality portfolio 10

11 Corporate key metrics (for demerger) PLN MM Receivables & deposits (AVG, gross) 2,273 2,449 2,139 2,280 NII down 9% Fees & FX income down 36% 8% 7% Receivables Deposits Revenue down 25% Losses RANR improvement down 11% Receivables increase due to strong sale 11

12 Business cost performance Costs (PLN MM) C/I ratio* (%) down 17% y/y down 32 pp. y/y % 90% excl. Visa impact 66% Strong costs decrease as a result of business transformation */ Excl. Other operating income and expenses 12

13 Asset quality Losses NPL ratio (50) (49) (5) Total losses (PLN MM) Cost of risk ratio 1 0.1% 0.7% Core pure cost (excl. DS) ratio 1 0.8% 0.8% Stable level of pure costs YoY. Positive impact of Debt Sale in 2Q last year. Reco from W/O loans IBNR Debt sale Core pure cost excl. DS 9.4% 7.5% 7.5% 7.3% H' H'16 Performing loans (PLN B) Impaired loans (PLN B) NPL Growth of performing loans with stable NPL level positively impacted NPL ratio. Retail 30+ delinquency(%) 2 Corporate and Mid SME average PD (%) 4.1% 4.1% 3.9% 3.3% 3.2% 2.6% 2.3% 2.6% 1.4% 1.7% 1.5% 1.7% 1.3% 0.9% 0.8% 0.7% H' H'16 PID MTG PLN MTG CHF SME MICRO Year on year retail delinquencies better or at stable level. 2.4% 2.1% 2.0% 1.9% 1.2% 1.3% 1.6% 1.3% H' H'16 Mid SME Corporate Commercial segment stayed with satisfactory portfolio quality. 1/ Costs measured in the relation to total credit portfolio 2/ With delinquency cut-off at 180 dpd 3/ Based on gross volumes, end of period 13

14 Capital and liquidity positions Capital ratios (%, eop) TCR Recommended TCR Q'15 3Q'15 4Q'15 1Q'16 TCR at 16.8% and Tier I ratio at 13.4% well above the regulatory minimums Strong liquidity position with liquidity buffer of PLN 2.6 B in 2Q 16 TCR TCR minimum Tier I Market risk exposures on a safe level Recommended Tier I Q'15 3Q'15 4Q'15 1Q'16 Tier1 Tier 1 minimum Strong and stable capital and liquidity positions 14

15 Summary 1. Demerger process moving forward as planned key regulatory approvals in place targeting 4Q completion 2. Strong growth in commercial sales, good early results from retail branch transformation 3. Significant cost reduction year to year with continued momentum 4. Positive impact of Visa transaction on results 5. Maintaining strong portfolio quality, capital and liquidity 15

16 Disclaimer This presentation does not constitute or form any part of an offer, invitation or inducement to sell or subscribe, or any solicitation of an offer to purchase or subscribe for any securities. This presentation does not purport to contain all information that a prospective investor might require, and neither this presentation nor any part of it nor the fact of its distribution shall form the basis of, or be relied on in connection with, any contract for the purchase or subscription of any securities. The forecasts and forward-looking statements contained in this presentation are necessarily based upon a number of assumptions and estimates that, while considered reasonable by us, are inherently subject to significant business, operational, economic and competitive uncertainties and contingencies, many of which are beyond our control, and upon assumptions with respect to future business decisions that are subject to change. Actual results may differ materially from those projected. Certain items of numerical information and other amounts and percentages set forth in this presentation may not add up to the correct total due to rounding. 16