Group financial report 30 September BayernLB posts profit before taxes of EUR 574 million in the first nine months of November 2015

Transcription

1 Group financial report 30 September 2015 BayernLB posts profit before taxes of EUR 574 million in the first nine months of November 2015

2 Agenda» First nine months of 2015 at a glance» Financial performance» Appendix Page 2

3 First nine months of 2015 at a glance First nine months of 2015 at a glance Outstanding profit before taxes of EUR 574m (9m 2014: EUR 561m); core business earnings sharply higher by 44% to EUR 724m. Strong earnings contribution from all operating segments Risk provisions low due to good portfolio quality Hard capital (CET 1) ratio climbed to a very solid 13.8% (fully loaded 11.1%) Cost/income ratio in the target range at 52.7% (9M %) Key step in resolving the last legacy issue: settlement reached on HETA Outlook unchanged: Profit before taxes in the mid triple-digit million range and earnings in core business on par with the good level in 2014 Page 3

4 First nine months of 2015 at a glance Key figures After-tax profit well in the black at EUR 426m; MKB weighed heavily on the year-before figure of EUR -561m Total assets already significantly below the EU target of around EUR 240bn for the end of 2015 RWA down a futher 7.2% to approximately EUR 71bn Leverage Ratio 4.2% (phase in) Profit before taxes Consolidated profit CIR RoE +2.3% >100.0% -2.8 Pp +1.5 Pp Jan 30 Sep Jan 30 Sep Jan 30 Sep Jan 30 Sep Jan 30 Sep Jan 30 Sep Jan 30 Sep Jan 30 Sep 2015 Total assets EUR bn RWA EUR bn CET 1 capital & ratio (phase-in) EUR bn / % CET 1 capital & ratio (fully loaded) EUR bn / % -4.9% -7.2% 12.8% 13.8% 10.2% 11.1% Dec Sep Dec Sep Dec Sep Dec Sep 2015 Page 4

5 First nine months of 2015 at a glance Solid core business continues to perform well Total income Profit before taxes Core business Non-core business Core business Non-core business Total income in core business climbed 20% 1,488 1, % % 1, , Profit before taxes in core business 44% higher 1 Jan 30 Sep Jan 30 Sep Jan 30 Sep Jan 30 Sep 2015 Core business RWA EUR bn Non-core business Administrative expenses Core business Non-core business RWA down to approximately EUR 71bn Dec % Sep % Administrative expenses up slightly due to first-time consolidation of DKB Service GmbH Page 5

6 Agenda» First nine months of 2015 at a glance» Financial performance» Appendix Page 6

7 Financial performance Net interest and net commission income in core business higher despite decrease in business volume Net interest income Net commission income Core business Non-core business Core business Non-core business 1,251 1,223 1,093 1, % % Jan 30 Sep Jan 30 Sep Jan 30 Sep Jan 30 Sep 2015 Net interest income in core business 6.5% higher Net commission income in core business up by 10.5% Page 7

8 Financial performance Risk provisions very low due to good portfolio quality Group: low risk provisions of EUR -32m (9M 2014: EUR -84m) BayernLB: additions of around EUR 146m offset by releases and recoveries on previously written-down receivables of some EUR 229m DKB: out of the EUR -115m in risk provisions, EUR -37m is for flat-rate SLLPs and EUR -55m for non-core business Non-performing loan ratio just 2.4% (excluding HETA: 1.4%) Risk provisions Breakdown by Group unit Core business Non-core business 1 Jan 30 Sep Jan 30 Sep % -32 BayernLB DKB LBLux Page 8

9 Financial performance Other earnings components Gains or losses on fair value measurement Gains or losses on financial investments Bank levy & deposit guarantee scheme Bank levy Deposit guarantee scheme 1 Jan 30 Sep Jan 30 Sep Jan 30 Sep Jan 30 Sep Jan 30 Sep Jan 30 Sep 2015 End of exchange rate floor for the Swiss Frank in Jan 2015 resulted in a charge of around EUR 100m (HETA risk provision) While there was an expense of EUR 30m for fair value adjustments, measurement of the own credit spread led to a gain of EUR 42m in the fair value option Proceeds from the sale of securities and the sale of shareholdings contributed to the positive earnings The negative figure in the yearbefore period stemmed mainly from the mark-to-market valuation of the Umbrella guarantee agreement with the Free State of Bavaria, which ended in 2014 EUR 99m first-time contribution to the restructuring fund under EU rules (bank levy) EUR 47m contribution to the deposit guarantee scheme of the Sparkassen-Finanzgruppe (Savings Banks Finance Group) Both figures are currently estimates for full-year 2015 Page 9

10 Financial performance Pleasing increasing in core business earnings Strong earnings of EUR 724m in core business, negative numbers in the non-core business DKB's earnings more than doubled to EUR 238m due mostly to a big increase in net interest income resulting from lower funding costs Earnings in Financial Markets up by over EUR 130m; big boost from price gains on securities Core units Corporates & Mittelstand Real Estate & Savings Banks/ Association DKB Financial Markets Central Areas & Other 1) Non-Core Unit Profit before taxes 1 Jan 30 Sep Jan 30 Sep ) Including consolidation Page 10

11 Financial performance Corporates & Mittelstand illion 1 Jan - 30 Sep Jan - 30 Sep 2014 Net interest income Risk provisions in the credit business Net commission income Gains or losses on fair value measurement Other earnings components 2 2 Administrative expenses Profit before taxes Risk-weighted assets (RWA) 21,591 20,662 Comments Sharp increase in profit before taxes despite difficult market conditions due to gains on the release of risk provisions Risk provisions reflect not only good portfolio quality but also large gains from releases and recoveries on previously written-down receivables Lower net interest and net commission income due mainly to low demand for loans 48.2 CIR +8% RoE +34% 13.8 Lower net interest and net commission income partly offset by customer-induced gains or losses on fair value measurement item Administrative expenses in line with yearbefore period Page 11

12 Financial performance Real Estate & Savings Banks/Association illion 1 Jan - 30 Sep Jan - 30 Sep 2014 Net interest income Risk provisions in the credit business Net commission income Gains or losses on fair value measurement Other earnings components -3 2 Administrative expenses Profit before taxes Risk-weighted assets (RWA) 7,384 8,724 Real estate New business continued to perform well Income was solid although it was down on 9M 2014 as a result of market conditions which squeezed profit margins Profit before taxes: EUR 119 m (9M 2014: EUR 127m) Savings Banks & Association Earnings fell from the year-before period due to subdued demand for capital market products as a result of low interest rates Profit before taxes: EUR 6m (9M 2014: EUR 24m) 45.3 CIR +15% RoE -13% 26.8 Operating performance was stable Decrease in earnings from the year before period mainly due to lower net interest income as a result of low interest rates Profit before taxes: EUR 35m (9M 2014: EUR 42m) Page 12

13 Financial performance DKB illion 1 Jan - 30 Sep Jan - 30 Sep 2014 Comments Net interest income Risk provisions in the credit business Net commission income Gains or losses on fair value measurement Other earnings components Administrative expenses Profit before taxes Risk-weighted assets (RWA) 24,806 26,079 Good performance continued: profit before taxes more than doubled over the yearbefore period Sharp increase in net interest income resulted from an improved funding structure, adjustment of variable interest rates to the low interest rate environment Administrative expenses rose as a result of first-time consolidation of DKB Service GmbH and continuing customer growth 54.3 CIR -14% RoE >100% 11.0 Receivables from customers increased by EUR 400m in the first nine months despite large repayments Position as "Your Bank on the web", now boasting 3.1 m retail customers, cemented further Page 13

14 Financial performance Financial Markets illion 1 Jan - 30 Sep Jan - 30 Sep 2014 Kommentare Net interest income Risk provisions in the credit business 0 18 Profit before taxes climbed to over EUR 120m Net commission income Gains or losses on fair value measurement Other earnings components Administrative expenses Profit before taxes Risk-weighted assets (RWA) 8,720 12,151 Earnings lifted sharply by price gains on securities, measurement gains (including lower charges for fair value adjustments) and lower administrative expenses Large decrease in tied-up capital (RWA) >100.0 CIR -57% RoE >100% 16.3 Earnings from Financial Markets products sold in the customer-serving segments were in line with year-before period despite subdued demand for capital market products due to market conditions; these earnings continue to be reported under the respective segments Page 14

15 Financial performance Non-Core Unit (NCU) illion 1 Jan - 30 Sep Jan - 30 Sep 2014 Kommentare Net interest income Risk provisions in the credit business Net commission income 9 25 Gains or losses on fair value measurement Other earnings components Administrative expenses Profit before taxes Risk-weighted assets (RWA) 6,646 14,702 The loss was mainly due to the writedown of a risk provision made in the year-before for the loans to HETA, compounded by the ending of the exchange-rate floor for Swiss francs In addition, there were further legal expenses for the claims against HETA and related legal disputes Continued wind down of RWA; approximately 55 percent lower than yearbefore period, due to sale of the ABS portfolio among other things 55.9 CIR >100% > RoE >100% In addition to the charges related to HETA, a EUR -67m (9M 2014: EUR -22m) increase in risk provisions on DKB's non-core business also weighed on the loss before taxes; this is largely offset by Restructuring Unit's profit before taxes of EUR 63m (9M 2014: EUR -52m) Page 15

16 Agenda» First nine months of 2015 at a glance» Financial performance» Appendix Page 16

17 Appendix Year-on-year earnings comparison illion 1 Jan - 30 Sep Jan - 30 Sep 2014 Change Net interest income 1,223 1, Risk provisions in the credit business Net interest income after risk provisions 1,191 1, Net commission income Gains or losses on fair value measurement Gains or losses on hedge accounting Gains or losses on financial investments Administrative expenses Expenses for the bank levy and deposit guarantee scheme >100.0 Other income and expenses Gains or losses on restructuring Profit before taxes Income taxes >100.0 Gains or losses on continuing operations Gains or losses on discontinued operations 0-1,071 - Profit/loss after taxes Profit/loss attributable to non-controlling interests Consolidated profit/loss Return on equity (RoE) (%) pp Cost/income ratio (CIR) (%) pp Page 17

18 Appendix Quarterly earnings comparison illion Q Q Q Net interest income Risk provisions in the credit business Net interest income after risk provisions Net commission income Gains or losses on fair value measurement Gains or losses on hedge accounting Gains or losses on financial investments Administrative expenses Expenses for the bank levy and deposit guarantee scheme Other income and expenses Gains or losses on restructuring Profit before taxes Page 18

19 Corporates & Mittelstand Real Estate & Savings Banks/Association DKB Financial Markets Central Areas & Others (including Consolidation) Non-Core Unit Group Appendix Segment Overview 1 Jan - 30 Sep 2015 Net interest income ,223 Risk provisions in the credit business Net commission income Gains or losses on fair value measurement Gains or losses on hedge accounting Gains or losses on financial investments Administrative expenses Expenses for the bank levy and deposit guarantee scheme Other income and expenses Gains or losses on restructuring Profit/loss before taxes Return on equity (RoE) (%) Cost/income ratio (CIR) (%) > Page 19

20 Corporates & Mittelstand Real Estate & Savings Banks/Association DKB Financial Markets Central Areas & Others (including Consolidation) Non-Core Unit Group Appendix Segment overview 9M Jan - 30 Sep 2014 Net interest income ,251 Risk provisions in the credit business Net commission income Gains or losses on fair value measurement Gains or losses on hedge accounting Gains or losses on financial investments Administrative expenses Expenses for the bank levy and deposit guarantee scheme Other income and expenses Gains or losses on restructuring Profit/loss before taxes Return on equity (RoE) (%) Cost/income ratio (CIR) (%) > Page 20

21 Appendix Balance sheet overview EUR bn 30 Sep Dec 2014 Change Loans and advances to banks Loans and advances to customers Assets held for trading Financial investments including interests in companies measured at equity Total assets Liabilities to banks Liabilities to customers Securitised liabilities Liabilities held for trading Subordinated capital Equity Page 21

22 Disclaimer The information in this presentation constitutes neither an offer nor an invitation to subscribe to or purchase securities or a recommendation to buy. It is solely intended for informational purposes and does not serve as a basis for any kind of obligation, contractual or otherwise. Rounding differences may occur in the presentation. Page 22

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