Samsung Securities Co., Ltd.

Transcription

1 Samsung Securities Co., Ltd. 3Q 2017 Earnings Release November 2017 Investor Relations

2 Contents Income Statement (summary) Net revenues Brokerage Financial product sales Trading & interest income Investment banking Operating expenses Wealth management client base Global network Appendix SAMSUNG SECURITIES

3 Income Statement (summary) (KRW billon) Consolidated Separate 3Q17 2Q17 3Q16 QoQ YoY 3Q17 2Q17 3Q16 QoQ YoY Net revenues % +32% % +34% Brokerage ¹ % +12% % +14% Financial product sales ² % +42% % +42% Trading & Interest Income (25%) (20%) (30%) (27%) Investment banking % +409% % +384% Other ³ % +88% % +97% Commission expenses (6.0) (7.4) (4.6) (19%) +30% (8.3) (9.7) (7.5) (14%) +10% Operating expenses % +11% % +11% Personnel expenses % +20% % +22% Amortization & depreciation (1%) (2%) (1%) (3%) Major Changes (Separate basis) Brokerage commission increased on improved domestic and overseas trading activity (+0.4% QoQ) Financial product sales revenue increased on strong ELS derivative early termination revenue (+39% QoQ) Trading & Interest income decreased due to weak FX rate related income (-30% QoQ) Investment banking revenue on strong structured products revenue (+17% QoQ) Revenue breakdown G&A expenses % +2% % +1% Operating income % +77% % +83% Non-operating income (0.7) % (50%) Pretax income % +75% % +82% Income tax expense % +77% % +85% 4% 10% Others Investment Banking Trading & Interest Income 8% 30% Brokerage Net income % +75% % +80% (Attributable to shareholders) % +76% Return on equity 8.2% 6.4% 5.7% +1.8%p +2.4%p 7.8% 6.1% 5.3% +1.7%p +2.5%p Cost-to-income ratio 57.4% 62.8% 68.2% (5.5%p) (10.8%p) 57.2% 62.7% 68.7% (5.5%p) (11.5%p) 48% Financial Product Sales ¹ Brokerage revenue excluding related costs ² Net revenues from financial product sales includes mutual funds, wrap accounts, OTC derivative products, bancassurance and trust(fixed income sales credit included in trading income) ³ Interest on securities borrowing expenses, card related commissions(separate basis includes dividend from subsidiaries) SAMSUNG SECURITIES 3

4 Separate 별도기준 basis Brokerage: W78.7bn (+0.4% QoQ, +14% YoY) Brokerage commission increased on improved domestic and overseas trading activity Domestic brokerage commission increased on strong institutional and foreign investor turnover (+0.3% QoQ, +12% YoY) Overseas equity sales commission up 2% QoQ as we strengthened sales capability through our global network (SSS) Brokerage Commission (SSS) Equity turnover (KRW trillion) (SSS) Overseas equity assets (KRW trillion) % +2% Overseas equity 5.7% 5.7% 5.9% M/S % % % 12.7 Foreigner Domestic Institution % +13% +11% Other U.S % 74.5 Domestic equity % 50.2 Individual Asia 주 : Domestic equity sales include futures, options, etc. Source : Samsung Securities, KOSPI, KOSDAQ, ETF & KONEX Source : Samsung Securities Source : Samsung Securities SAMSUNG SECURITIES 4

5 Separate 별도기준 basis Financial product sales: W127.3bn (+39% QoQ, +42% YoY) Financial product sales revenue increased on strong ELS derivative early termination revenue OTC Derivatives revenue increased 52% QoQ due to record high ELS early termination revenue (W103.5bn, +64% YoY) ELS early termination revenue: W38.1bn in 3Q16 W47.3bn in 2Q17 W80.5bn in 3Q17 Financial products balance increased to W38tn on gains from mutual funds, wrap accounts etc. (SSS) Financial product sales revenue (SSS) OTC derivatives sales (SSS) Financial products balance (KRW trillion) (KRW trillion) % -0.6% % % % Trust, etc Wrap Account Fund OTC derivatives 11.6% 11.6% 13.3% M/S % % -5% +0.2% +3% OTC derivatives Wrap Account Fund % 16.3 Trust, etc Note : Net of related expenses Note: : Samsung Securities, Note : End balance SAMSUNG SECURITIES Excluding DC-type retirement pension 5

6 Separate 별도기준 basis Trading & interest income: W22.0bn (-21% QoQ, -17% YoY) Trading & interest income decreased due to weak FX rate related income Client cash deposit and margin loan up 5%,17% QoQ, respectively (SSS) Trading & interest income (SSS) Trading income related assets (SSS) Deposit & margin loan balance -21% (KRW trillion) (KRW trillion) Client cash deposit % DLS ELS Margin loan % RP Source: Samsung Securities Note : End balance of client asset balance Note : Average balance SAMSUNG SECURITIES 6

7 Separate 별도기준 basis Investment banking: W26.2bn (+17% QoQ, +384% YoY) IB revenue increased on strong structured products revenue ECM, DCM and M&A revenue decreased due to base effect from big deals in 2Q17 * ING life IPO, SK shipping TRS In 3Q17, IB-WM jointly mandated 26 IPO deals, which is a sharp increase from 3 deals in 2016 Corporate loan balance up as we actively participated in SP deals utilizing capital (SSS) Investment banking revenue (SSS) Corporate loan balance (SSS) Number of IPO Mandates (# of deals) +17% % -9% DCM ECM M&A 26 WM related % 1, % 14.2 Structured Products '16 '17.9 Note : Structured financing includes structured products related revenue, Note : Average balance Note : # of accumulated deals SAMSUNG foreign SECURITIES currency securities etc. 7

8 Separate 별도기준 basis Operating expenses W146.7bn (+4% QoQ, +11% YoY) Operating expenses increased as variable compensation increased on the back of improved earnings Cost-to-income ratio improved to 57% due to strong earnings and effective cost management (SSS) Operating expenses (SSS) Cost-to-Income ratio (SSS) Branches & employees % % Fixed exp. / 66% 66% 62% operating exp. Variable personnel exp. 2,208 2,172 2,256 # of branches % 53.4 Fixed personnel exp % % 59.2 Service charge SG&A 69% 63% 57% # of employees Note : Fixed expense includes personnel expenses, IT expenses, Note : Including employees in overseas offices depreciation cost, rent and maintenance costs SAMSUNG SECURITIES 8

9 Separate 별도기준 basis Wealth management client base: W183tn (+1% QoQ, +5% YoY) Client assets increased on continued strong net inflow despite valuation loss HNWI clients total assets surpassed W100tn in 3Q17 ( +1% QoQ, +12% YoY) # of HNWI clients: 99,365 clients (+2,537 people QoQ): Strengthened on-line mass affluent client base using new marketing and alliance channels (SSS) Client assets (KRW trillion) (SSS) Number of HNWI clients ( 000 person) (SSS) Non Face-to-Face client base ( 000 accounts) Net inflow Asset per Person (W100 mn) 8.0% 8.9% 8.9% Mobile M/S Institutions (HNWI) Individuals 1Q 17 2Q 17 3Q 17 Note : W266tn including institutions Note : W10.1mn including institutions Note : Samsung Securities SAMSUNG SECURITIES 9

10 Global Network Expanded partnerships with leading global firms and seek for new WM and IB opportunities 2017: Vietnam (Dragon Capital Group-Ho Chi Minh City Securities), Japan (SMBC NIKKO), U.S. (BBAM: Aircraft Financing) Europe U.S. China Japan Taiwan Vietnam SAMSUNG SECURITIES 10

11 Appendix Company overview Net revenue breakdown Financial statements Balance sheet Income statement Client assets under management SAMSUNG SECURITIES

12 Company Overview Appendix CEO Mr. Yong-Am Yoon Number of employees 2,256 Market Cap. (Sep 30, 2017) W3.1tn Key Financials (consolidated) 3Q Total assets 37,222 33,230 30,994 Shareholders equity 4,341 3,827 3,524 (Majority interest) 4,341 3,827 3,524 Net income (Majority interest) (Accumulated) ROE(annualized, %) Shareholder composition Samsung Life insurance(29.4%), other affiliates(0.2%), (Financial Advisors) % 4.7% 7.9% National Pension Service(8.4%), foreign investors(23.3%), other institutional and individual investors(38.7%) Oversea branches Seoul Hong Kong New York London Beijing Tokyo Founded Shareholders equity Separate basis Number of branches 68 4, Company History 1982 Founded as Hanil Investment Finance 1988 Listed in Korea Exchange 1992 Joined Samsung Group and renamed Samsung Securities 2000 Merged with Samsung Investment Trust and Securities 2003 Adopted wealth management business model 2006 Ranked #1 in all categories of Asiamoney s Brokers Poll Signed cooperation agreement with Rothschild UK Named Best Research in Korea by Institutional Investor for three consecutive years 2010 Named Best Broker in Korea by Institutional Investor 2011 Signed MOU with China Asset Management (China AMC) Named Best Broker, Research, Equity in Korea by Asiamoney 2012 Named Best Private Bank and Broker by FinanceAsia for five consecutive years 2013 Named Best Fund Distributor in Korea by AsianInvestors 2014 Signed cooperation agreement with Pioneer Investments and Neuberger Berman 2015 Signed cooperation agreement with Woori Bank and CITIC Securities 2016 Signed cooperation agreement with KGI Securities 2017 Signed cooperation agreement with HSC Securities Signed cooperation agreement with SMBC Nikko Securities Included in Dow Jones Sustainability World Index for eight consecutive years SAMSUNG SECURITIES 12

13 Net revenue breakdown Appendix Net revenue breakdown Net revenue classification Brokerage commission Net brokerage commission after deducting trading commissions 4% 6% 4% 3% 4% 10% 16% 8% 26% Others Underwriting/ M&A Trading & interest income Sales commission from financial products Net wrap account fee after deducting commission for external advisory firms Fund sales commission and management fee Includes early termination revenue and day 1 profit from OTC derivatives Trading gains/losses related to securities 29% 40% 48% Financial product sales Trading & interest income Sales commissions of fixed income Gains/losses from proprietary trading Interest income related to trading(interest on fixed income, repo, swap, etc.) Gains/losses on valuation of clients deposits Distribution income 38% 35% 30% Brokerage Investment banking Underwriting commissions on securities, foreign securities and debentures M&A commission Q 17 Others Trust fees, stock lending commission, etc. Dividend income from subsidiaries Separate basis SAMSUNG SECURITIES 13

14 Consolidated balance sheet Appendix 3Q 17 (QoQ) (YoY) 2Q 17 1Q 17 4Q 16 3Q 16 2Q 16 1Q 16 4Q 15 3Q (YoY) Total Asset 37,201 +5% +12% 35,413 33,690 33,230 33,265 34,104 32,816 30,994 31,091 33,230 30,994 +7% I. Cash and cash equivalents 1, % +28% 1,148 1,262 1, , % II. Financial assets at Fair Value 20,020 +2% +0.1% 19,580 18,697 19,389 19,994 20,704 20,307 20,370 20,685 19,389 20,370-5% III. Financial assets available for sale 6,609 +8% +42% 6,132 6,023 5,755 4,664 4,282 3,651 3,302 2,463 5,755 3, % IV. Loans and receivables 9, % +24% 8,380 7,516 6,822 7,496 8,085 8,095 6,529 7,189 6,822 6,529 +4% V. Financial assets held to maturity VI. Investments in associates 12 +1% +0.3% % VII. Fixed assets 49-5% -16% % VII Investments in real estate IX. Intangible assets 93-3% -6% % X. Prepaid tax % -98% % XI. Deferred income tax assets % +453% % XII. Other Assets 11 +2% +4% % Total liabilities 32,860 +5% +10% 31,160 29,521 29,403 29,768 30,631 29,412 27,471 27,462 29,403 27,471 +7% I. Financial liabilities at Fair Value 9,816-7% +0.3% 10,592 10,328 10,313 9,788 10,167 10,366 9,219 9,628 10,313 9, % II. Deposits 5,378 +3% +18% 5,212 4,806 4,557 4,551 4,732 4,820 4,522 4,468 4,557 4,522 +1% III. Borrowings 14, % +11% 13,068 12,018 12,955 12,940 12,790 11,664 11,569 10,986 12,955 11, % IV. Debenture issued % +77% % V. Defined benefit liabilities % +72% % VI. Reserve for contingent liabilities % +25% % VII. Accrued income taxes 36-17% +1,561% % VIII. Deferred income tax liabilities % -43% % IX. Other liabilities 2, % +20% 1,689 1, ,883 2,326 1,962 1,572 1, ,572-37% Total equity 4,341 +2% +24% 4,254 4,168 3,827 3,497 3,473 3,404 3,524 3,629 3,827 3,524 +9% I. Share capital % II. Capital surplus 1, % 1,743 1,743 1,471 1,508 1,508 1,508 1,508 1,508 1,471 1,508-2% III. Capital adjustment (59) - -86% (59) (59) (59) (408) (408) (408) (330) (233) (59) (330) -82% IV. Accumulated OCI % +6% % VI. Retained earnings 2,050 +4% +10% 1,963 1,896 1,889 1,864 1,814 1,762 1,785 1,763 1,889 1,785 +6% VII. Minority interest (0.8) SAMSUNG SECURITIES 14

15 Separate balance sheet Appendix 3Q 17 (QoQ) (YoY) 2Q 17 1Q 17 4Q 16 3Q 16 2Q 16 1Q 16 4Q 15 3Q (YoY) Total Asset 35,369 +5% +11% 33,846 32,341 31,941 31,992 32,909 31,700 29,923 29,952 31,941 29,923 +7% I. Cash and cash equivalents 1, % +36% 1,138 1,250 1, , % II. Financial assets at Fair Value 20,130 +2% +0.3% 19,729 18,823 19,478 20,077 20,832 20,364 20,278 20,528 19,478 20,278-4% III. Financial assets available for sale 6,542 +7% +42% 6,104 5,996 5,714 4,623 4,190 3,566 3,227 2,389 5,714 3, % IV. Loans and receivables 7, % +19% 6,470 5,847 5,264 6,003 6,641 6,812 5,269 5,945 5,264 5, % V. Financial assets held to maturity VI. Investments in associates % -2% % VII. Fixed assets 47-5% -19% % VII Investments in real estate IX. Intangible assets 90-3% -7% % X. Prepaid tax % XI. Deferred income tax assets XII. Other Assets 10-1% -1% % Total liabilities 31,064 +5% +9% 29,623 28,199 28,148 28,516 29,460 28,316 26,419 26,337 28,148 26,419 +7% I. Financial liabilities at Fair Value 9,816-7% +0.3% 10,590 10,328 10,311 9,788 10,167 10,365 9,207 9,608 10,311 9, % II. Deposits 3,921 +1% +18% 3,867 3,498 3,302 3,309 3,576 3,716 3,470 3,472 3,302 3,470-5% III. Borrowings 14,115 +9% +9% 12,901 12,040 12,979 12,962 12,813 11,708 11,614 11,032 12,979 11, % IV. Debenture issued % +77% % V. Defined benefit liabilities % +86% % VI. Reserve for contingent liabilities % +25% % VII. Accrued income taxes 34-19% VIII. Deferred income tax liabilities % -43% % IX. Other liabilities 2, % +20% 1,668 1, ,856 2,292 1,931 1,543 1, ,543-37% Total equity 4,305 +2% +24% 4,223 4,143 3,793 3,476 3,449 3,385 3,504 3,615 3,793 3,504 +8% I. Share capital % II. Capital surplus 1, % 1,743 1,743 1,471 1,508 1,508 1,508 1,508 1,508 1,471 1,508-2% III. Capital adjustment (36) - -91% (36) (36) (36) (386) (386) (386) (307) (210) (36) (307) -88% IV. Accumulated OCI 142-1% +3% % VI. Retained earnings 1,998 +4% +10% 1,914 1,851 1,845 1,822 1,776 1,728 1,752 1,737 1,845 1,752 +5% SAMSUNG SECURITIES 15

16 Consolidated income statement Appendix 3Q 17 (QoQ) (YoY) 2Q 17 1Q 17 4Q 16 3Q 16 2Q 16 1Q 16 4Q 15 3Q (YoY) Net revenues % +32% % Brokerage commissions % +12% % Financial product sales % +42% % (Wrap account) % -25% % (Fund) % -1% % (OTC derivatives) % +64% % (Others) % % Trading and interest income % -20% % Investment banking % +409% % Other income % +88% % Commission expenses (6.0) -19% +30% (7.4) (5.3) (4.8) (4.6) (5.1) (5.5) (4.6) (5.9) (19.9) (20.7) -4% Operating expenses % +11% % Personnel expenses % +20% % Depreciation & Amortization 9.8-1% -2% % G&A expenses % +2% % (IT expenses) % +4% % (Rent) % +9% % (Advertisement) % -6% % (Others) % +0.1% % Operating income % +77% % Non-operating revenues (1.1) (1.7) (1.3) (1.3) (0.3) 18.2 (11.8) - Pretax income % +75% % Tax % +77% % Net income from discontinued operations Net income % +75% % (Majority share) % +76% % SAMSUNG SECURITIES 16

17 Separate income statement Appendix 구분 3Q 17 (QoQ) (YoY) 2Q 17 1Q 17 4Q 16 3Q 16 2Q 16 1Q 16 4Q 15 3Q (YoY) Net revenues % +34% % Brokerage commissions % +14% % Financial product sales % +42% % (Wrap account) % -25% % (Fund) % -1% % (OTC derivatives) % +64% % (Others) 5.3-1% -18% % Trading and interest income % -27% % Investment banking % +384% % Other income % +97% % Commission expenses (8.3) -14% +10% (9.7) (7.8) (7.1) (7.5) (8.0) (6.5) (7.4) (9.9) (29.2) (32.4) -10% Operating expenses % +11% % Personnel expenses % +22% % Depreciation & Amortization 9.5-1% -3% % G&A expenses % +1% % (IT expenses) % +4% % (Rent) % +7% % (Advertisement) % -6% % (Others) % -3% % Operating income % +83% % Non-operating revenues % -50% 0.2 (2.0) (2.3) (6.7) (14.0) 17.3 (27.4) - Pretax income % +82% % Tax % +85% % Net income % +80% % SAMSUNG SECURITIES 17

18 Client assets under management Appendix Client asset breakdown (KRW trillion) 3Q 17 2Q 17 1Q 17 4Q 16 3Q 16 Client assets Equity Investment products Fund Fixed Income Other Pension OTC derivatives Repo Trust Trust OTC derivatives Pension Other (CP, cash, etc.) Client cash deposits RP Fixed income 3Q 17 2Q 17 1Q 17 4Q 16 3Q 16 Client assets Individuals Mutual funds (HNWIs) # of HNWI clients 99,365 96,828 92,019 90,003 93,822 3Q 16 4Q 16 1Q 17 2Q 17 3Q 17 SAMSUNG SECURITIES 18

19 Disclaimer This presentation includes forward-looking statements about Samsung Securities Co., Ltd. All statements that address expectations or projections about the future are forward-looking statements. Although they reflect our current expectations, these statements are not guarantees of future performance, but involve a number of risks, uncertainties, and assumptions. Samsung Securities assumes no obligation to provide revisions to any forward-looking statements should circumstances change.