BancoSabadell. Small Caps Seminar. London, 18th March Juan M. Grumé Finance & Investor Relations Director

Transcription

1 BancoSabadell Small Caps Seminar London, 18th March 2003 Juan M. Grumé Finance & Investor Relations Director

2 AGENDA 1. BANCO SABADELL HIGHLIGHTS 2. PROFIT & LOSS ACCOUNT, AN ANALYSIS 3. COMMERCIAL STRATEGY 4. BUSINESS EVOLUTION 5. CORPORATE GOVERNANCE BUDGET 2

3 HIGHLIGHTS All amounts in m % growth Dec-01 Dec-02 Dec-02/Dec-01 Total Assets , ,2 2,5 Loans to customers , ,6 12,7 On-balance sheet customer deposits , ,2 1,5 Funds under management , ,0 2,9 Shareholders' equity 2.355, ,3-13,0 Bad and doubtful debts as % of total lending Total provisions as % of bad and doubtful debts 0,46% 0,47% 334,9% 351,1% Employees Domestic Branches ATM's On-balance sheet customer deposits + Mutual funds + Pension Funds + Technical reserves 3

4 SNAPSHOT OF MAIN COMPETITORS (I) 31/12/2002 All amounts in m Market capitalisation 2 Total Assets Loans to customers SAN BBVA POP SAB BKT SAN BBVA POP SAB BKT SAN BBVA POP SAB BKT Customer deposits Mutual funds Bancassurance BBVA SAN POP SAB BKT SAN BBVA POP BKT SAB BBVA SAN SAB POP BKT 1 As of 30/09/02 2 As of 10/3/03 4

5 SNAPSHOT OF MAIN COMPETITORS (II) 31/12/2002 NPL RATIO 1 COVERAGE RATIO ROA 1,71% 0,92% 1,00% 0,89% 0,47% 0,31% 140% 223% 193% 351% 441% 0,81% 0,85% 0,86% 0,53% 3 2 SAN BBVA POP SAB BKT 3 2 SAN BBVA POP SAB BKT SAN BBVA POP SAB BKT BIS RATIO P / BV 02 4 P / E ,64% 11,01% 11,00% 11,85% 11,66% 17,16x 2,8x 2,5x 11,16x 14,40x 12,32x 12,73x 1,2x 1,5x 1,4x 4,46% 4,09% 7,01% 7,12% 5,93% SAN BBVA POP SAB BKT Core Capital Pref. Shares and others Subordinated debt Provisions and others 1 On and off balance sheet. 2 Spain and Portugal. 3 Spain 4 As of 10/3/03 SAN BBVA POP SAB BKT SAN BBVA POP SAB BKT 5

6 AGENDA 1. BANCO SABADELL HIGHLIGHTS 2. PROFIT & LOSS ACCOUNT, AN ANALYSIS 3. COMMERCIAL STRATEGY 4. BUSINESS EVOLUTION 5. CORPORATE GOVERNANCE BUDGET 6

7 P/L ACCOUNT RECURRENT VS PUBLISHED (I) % Growth 01/02 Published Recurrent Published Recurrent Published Recurrent Net interest income 703,1 683,3 714,4 689,0 Net commissions 280,5 280,5 285,1 285,1 Results on financial transactions 56,4 27,1 8,6 25,1 Gross operating income 1.040,0 990, ,1 999,2-3% 1% Personnel expenses -361,5-352,0-380,9-358,1 Other administrative expenses -192,7-169,4-286,2-186,0 Deprec & Amort of assets -49,8-49,8-57,3-53,7 Other operating income -2,7-2,7 8,4 8,4 Net operating income 433,3 417,0 292,1 409,8-33% -2% Equity-accounted holdings 34,9 54,7 45,5 70,9 Goodwill amortisation -35,1-35,1-127,1-10,0 B&DD's provisions -73,3-73,3-101,1-101,1 Write-downs of financial fixed assets 0,0 0,0 125,6 0,0 Other income 2,0 2,0 25,3 3,8 Income before taxes 361,7 365,2 260,3 373,4-28% 2% Taxes -135,8-137,1-29,1-113,5 Minorities -9,4-9,4-10,8-10,8 Group net profit 216,5 218,7 220,4 249,2 2% 14% 7

8 P/L ACCOUNT RECURRENT VS PUBLISHED (II) 2002 Adjustments 2002 Published Amount Details Recurrent Net interest income 714,4-25,4 Dividends + others 689,0 Net commissions 285,1 285,1 Results on financial transactions 8,6 16,5 Market downturn 25,1 Gross operating income 1.008,1 999,2 Personnel expenses -380,9 22,8 Severance costs and others -358,1 Other administrative expenses -286,2 100,2 Software amortisation and others -186,0 Deprec & Amort of assets -57,3 3,6 ActivoBank setting-up costs -53,7 Other operating income 8,4 8,4 Net operating income 292,1 409,8 Equity-accounted holdings 45,5 25,4 Dividends + others 70,9 Goodwill amortisation -127,1 117,1 BCP extraordinary charge -10,0 B&DD's provisions -101,1-101,1 Write-downs of financial fixed assets 125,6-125,6 General risk reserve 0,0 Other income 25,3-21,5 Real estate disposals 3,8 Income before taxes 260,3 373,4 Taxes -29,1-84,4 Internal pension fund externalisation -113,5 Minorities -10,8-10,8 Group net profit 220,4 249,2 ROA 0,86% 0,97% ROE 10,02% 11,32% Adjusted ROE 1 13,56% 15,28% Cost/income ratio 66,17% 54,45% % Growth EPS 1,08 1,22 13,0% P/E 11,57x Price: 12,50 10,23x 1 Adjusted by goodwill arosen in BCP and Banco Herrero transactions 8

9 GENERAL ADMINISTRATIVE COSTS FORECAST m 667,1-49,6 589,5 599,6 617,5 286,2 204,3 204,0 210,6 380,9 385,2 395,6 406, e 2004e 2005e Personnel costs Other costs e 5,0% 7,5% 10,0% Gross operating income 1.008, , , ,6 Cost/income ratio 66,2% 52,9% 49,3% 46,0% 9

10 AGENDA 1. BANCO SABADELL HIGHLIGHTS 2. PROFIT & LOSS ACCOUNT, AN ANALYSIS 3. COMMERCIAL STRATEGY 4. BUSINESS EVOLUTION 5. CORPORATE GOVERNANCE BUDGET 10

11 MULTIBRAND APPROACH Parent company Individuals Companies North western Spain Individuals Companies Foreigners residents in Spain Private Banking 11

12 AGENDA BRANDS: GEOGRAPHICAL DISTRIBUTION ASTURIAS CANTABRIA GALICIA BASQUE COUNTRY NAVARRE LA RIOJA CASTILE- LEON ARAGON CATALONIA MADRID CASTILE-LA MANCHA VALENCIA BS BS- SBK BH BS-BH EXTREMADURA ANDALUCIA MURCIA BALEARIC ISLANDS CANARY ISLANDS 12

13 COMMERCIAL STRATEGY (I) All amounts in m Commercial Banking - Individuals: Medium/high net worth - Companies: turnover < 6m SME Banking - Companies: turnover > 6m Highlights (31/12/02) Branches 543 Employees Volumes* Loans 14,697 On-balance sheet deposits 9,745 * Average volumes Commercial Banking - Individuals: High concentration in medium / low net worth (Asturias) - Companies: turnover < 3m SME Banking - Companies: turnover > 3m Highlights (31/12/02) Branches 299 Employees 1,146 Volumes* Loans 3,588 On-balance sheet deposits 3,133 13

14 COMMERCIAL STRATEGY (II) All amounts in m La Coruña Zaragoza Barcelona Madrid Valencia Palma de Mallorca Foreigners resident in Spain (medium/high-medium/ high net worth) Shops/ companies in areas with residential tourism and turnover < 6m Access through: agents, building developers, brokers. Highlights (31/12/02) Branches 60 Employees 316 Volumes* Loans 408 On-balance sheet deposits 628 * Average volumes High net worth individuals > 0.5m Legal entities used to net worth management and familiar companies Institutions Highlights (31/12/02) Branches 6 Employees 43 Volumes* Loans 38 AuM 1,754 14

15 GEOGRAPHIC FOCUS Catalonia Contribution to BS Group % Loans 49,7% % Deposits 45,9% % Branches 35,2% % Customers 41,5% Madrid Contribution to BS Group % Loans 14,3% % Deposits 15,2% % Branches 13,3% % Customers 8,0% Region data (over Spain) Population 15,5% SMEs 19,0% GDP 18,7% Customer loans 19,1% Customer deposits 17,9% GDP per capita (Spain=100%) 120,4% BS Group market share Loans 7,0% Deposits 5,6% Branches 4,5% Region data (over Spain) Population 13,3% SMEs 14,2% GDP 17,8% Customer loans 24,3% Customer deposits 24,7% GDP per capita (Spain=100%) 133,8% BS Group market share Loans 1,8% Deposits 1,2% Branches 2,6% Valencia & Balearic Island Contribution to BS Group % Loans 10,8% % Deposits 8,8% % Branches 11,2% % Customers 9,2% Asturias Contribution to BS Group % Loans 7,7% % Deposits 16,8% % Branches 20,6% % Customers 23,8% Region data (over Spain) Population 12,3% SMEs 13,3% GDP 12,2% Customer loans 12,1% Customer deposits 10,2% GDP per capita (Spain=100%) 100,3% BS Group market share Loans 2,4% Deposits 1,4% Branches 2,0% Region data (over Spain) Population 2,6% SMEs 2,3% GDP 2,3% Customer loans 1,8% Customer deposits 2,2% GDP per capita (Spain=100%) 87,2% BS Group market share Loans 16,5% Deposits 14,5% Branches 21,8% 15

16 COMMERCIAL ORGANISATION New structure Customer Bus. Transverse Bus. Complementary B. Joint Ventures Finance Business COMMERCIAL ORGANIZATION BSSME Banking Bancassurance Real Estate Dexia Local Trading & ALM BS Commercial Pensions Capital Risk BS Andorra Equity Holdings Solbank Asset Management Managerland BH SME Banking Investment Banking E-xtendnow BH Commercial International SBP Privada Ibersecurities Activobank 16

17 CRM INTERNAL TOOLS: COMMERCIAL DIARY 17

18 AGENDA 1. BANCO SABADELL HIGHLIGHTS 2. PROFIT & LOSS ACCOUNT, AN ANALYSIS 3. COMMERCIAL STRATEGY 4. BUSINESS EVOLUTION 5. CORPORATE GOVERNANCE BUDGET 18

19 GROSS LOANS TO CUSTOMERS (I) All amounts in m Secured Lending +20.9% YoY % YoY ,8 519 Unsecured Lending , proforma Other securitised loans Securitised mortgages 19

20 GROSS LOANS TO CUSTOMERS (II) with a diversified business structure 62% SME exposure by products: 40% 20% 32% 6% 1% 26% 14% Bill discounting Mortgages Leasing Others SME exposure by company turnover Individuals SMEs Others Public Adm 23% 23% Individuals includes shops and self-employed people Turnover (million ) E1 < 0,9 E2 < 3,0 E3 <30,0 E4 >30,0 35% E1 E2 E3 E4 19% 20

21 GROSS LOANS TO CUSTOMERS (III) with a diversified business structure 32% 62% Individual s exposure by product: 20% 6% 1% Individuals SMEs Others Public Adm Mortgages Customer lending 80% Individuals includes shops and self-employed people 21

22 MORTGAGE LOANS % mortgages loans / total gross customer loans: 41,3% Mortgage Breakdown 19% 15% 15% Developers First housing Second housing Companies Others 5% 46% Average loan: Mortgage service cost / net family income: 27,11% LTV: 63,89% NPL (mortgages to individuals): 0,23% 22

23 MORTGAGES: HIGH LOYALTY LEVEL 5,23 4,74 4,86 4,92 5,21 5,36 5,18 2,71 Without Mortgage <1 year 1 year 2 years 3 years 4 years 5 years >5 years With Mortgage Products per client 23

24 CREDIT QUALITY: MARGINAL EXPOSURE TO EMERGING MARKETS 31/12/02 OECD 4,5% 0,9% Others Spain 94,6% OECD Country exposure: 99,1% 24

25 NPL RATIO AND COVERAGE NPL ratio maintained 334,9% 1 351,07% % % 1Q 0.63% 0.59% 0.56% 0.56% 0.55% 0.51% 0.46% 0.52% 0.58% 0.53% 0.47% 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Including off-balance sheet risks and their provisions 1 As of 31/12 25

26 CREDIT QUALITY 31/12/02 NPL /Total Loans % 9 6 1,20 0,89 1,21 1 1,00 3 0,46 0,47 0,37 0, Total system Banco Sabadell Banco Popular Bankinter On balance sheet figures as of 4Q02 Source:Bank of Spain (Boletín Estadístico) and companies annual and quarterly reports 1 As of 30/11/02 26

27 FUNDS UNDER MANAGEMENT On balance-sheet Debt securities Customer deposits +16.7% YoY +7.8% YoY proforma Off balance-sheet Bancassurance +1.8% YoY +5.8% YoY Mutual funds All amounts in million 2000 proforma

28 AGENDA 1. BANCO SABADELL HIGHLIGHTS 2. PROFIT & LOSS ACCOUNT, AN ANALYSIS 3. COMMERCIAL STRATEGY 4. BUSINESS EVOLUTION 5. CORPORATE GOVERNANCE BUDGET 28

29 TRANSPARENT CORPORATE GOVERNANCE General Shareholders Meeting Board of Directors Executive Committee Supervisory Committees Business Units Corporate Units Risk Committee Appointment and Remuneration Committee Audit Committee Budget Control Committee 29

30 EXECUTIVE COMMITTEE Mr. José Oliu Chairman & CEO BUSINESS Mr. Juan Mª Nin Gral Mng. and Board Member Commercial Banking Corporate Banking International and BS Capital Bancassurance Treasury and Capital Markets Asset Management CORPORATE CENTRE Mr. José Permanyer Gral Mng. and Board Member Organization & Resources IT Systems Operations Credit Risk and Recoveries COMPTROLLER GENERAL Mr. José L. Negro 30

31 CONTROL STRUCTURE Chairman & CEO José Oliu Control Tomás Varela Finance & Investor Relations Juan M. Grumé Comptroller General José L. Negro Communications Josep M. Suàrez General Manager (Business) Juan M. Nin General Manager (Corporate Centre) José Permanyer 31

32 AGENDA 1. BANCO SABADELL HIGHLIGHTS 2. PROFIT & LOSS ACCOUNT, AN ANALYSIS 3. COMMERCIAL STRATEGY 4. BUSINESS EVOLUTION 5. CORPORATE GOVERNANCE BUDGET 32

33 2003 BUDGET: GROWTH FORECAST Loans +11,7% Customer deposits +8,9% Off-balance sheet deposits +12,5% 33