Consolidated Results 3 rd Quarter 2017

Transcription

1 Consolidated Results 3 rd Quarter 2017 Unaudited financial information Investor Relations Office Date 27/10/2017

2 Agenda Highlights Results Balance Sheet Asset Quality Liquidity Capital 2

3 Highlights 3

4 Effective implementation of Strategic Plan allowing significant provisioning of restructuring costs 1 Capital Adequate Solvency Ratios, following the Recapitalisation Plan Capital Ratios (Phased-in): CET1: 13.0% Tier 1: 14.1% Total: 14.8% 2 Efficiency and Profitability as well as an effective execution of the Strategic Plan, allows the provision of non recurrent restructuring costs (595 M ) Evolution 9M 2017 vs. 9M 2016: Net Interest Income: +18% Recurrent Operating Costs: -6% Total Operating Income: +45% Net Core Operating Inc. before Impairm.: +80% NPE and NPL Evolution vs. Dec. 2016: 3 Asset Quality with continuous performance in reducing non-performing assets NPE: 10.1% (-2.0 pp); NPL: 13.3% (-2.5 pp) Coverage by Impairments: NPE: 53.4%; NPL: 53.4% Cost of Credit Risk: 0.16% 4 Liquidity and a wide base of available funding. Deposits: 79% of Liabilities Pool of available Collateral: 13.6 B LCR: 204% Loans-To-Deposits: 88% Notes: 1) September 2016 values have been restated, considering Mercantile Bank Holdings, Ltd. as a non-current asset held for sale; 2) September 2017 Solvency and Asset Quality ratios are estimated, subject to change when definitive values are determined. 4

5 Results 5

6 Results Strong improvement in profitability M Net Core Operating Income before Impairments (1) (2) Consolidated Net Income (1) Net Core Operating Income before Impairments = Total Core Operating Income - Operating Costs Total Core Operating Inc. = Net Interest Income + Net Fees and Commissions; (2) Excluding non recurrent costs related to staff reduction programmes and also to international operations restructuring and sale provisions, as applicable to each P&L item, a total gross amount of 20 M and 595 M in September 2016 and September 2017 respectively. The total net amount was 15 M and 520 M in the same periods. 6

7 Results Strategic Plan implementation generates non recurrent costs M Provisions of restructuring costs and sale of international activities Provisions for operational structure reduction program ( ) International Activity (Contribution) Domestic Activity (Contribution) Total International Activity Domestic Activity Tax Effect Consolidated Net Income Net Income from Current Activity Non Recurrent Costs

8 Results Net Interest Income advances M % vs. 3Q % Q 2Q 3Q 4Q 1Q 2Q 3Q Net Interest Income Quarterly Net Interest Income Note: Values refer to disclosure date accounts. 8

9 Results Fees and Commissions grow consistently and Trading Income benefits from CGDs interest rate risk hedging policy M 2.0% Net Fees and Commissions Net Trading Income 9

10 Results Total Operating Income was influenced by Net Interest Income and Trading Income M , % +149M -10M +7M +345M +27M ,150 Net fees and commissions Net trading income Income from equity instruments Net interest income Other Operating Income 10

11 Results Lower recurrent Operating Costs at consolidated level M Non recurrent costs 4% (1) 12% (1) 4% 6% (1) 1, Employee costs Other administrative expenses Depreciation and amortisation Total Operating Costs Consolidated Activity (1) Excluding non-recurrent costs. 11

12 Results and also lower recurrent Operating Costs in Portugal M Non recurrent costs 8% (1) 12% 3% 9% (1) Employee costs Other administrative expenses Depreciation and amortisation Total Operating Costs CGD Portugal (1) Excluding non-recurrent costs. 12

13 Results Strategic Plan execution in line with the objectives 8,868 8,896 8,819 Number of Employees Domestic Activity 8, vs Branch Office Network CGD Portugal (Physical branches) vs

14 Results Cost-to-Income continues its downwards path % 77% 64% -5% 77% -22% 50% Cost-to-Core Income (1) (2) Operating Costs Reduction Cost-to-Income Total Operating Income Increase (2) (3) (1) Operating Costs / (Net Interest Income + Net Fees and Commissions); (2) Excluding non-recurrent costs; (3) Ratio defined by the Bank of Portugal Instruction 23/2012 [Operating Costs / (Total Operating Income + Income From Associated Companies)]. 14

15 Results Contributions to consolidated Net Income M BNU Macao: % France Branch: % Domestic Activity International Activity BCG Angola: 23 BCG Espanha: % 21.9% BCI Mozambique: % Main contributions from International activity ROE 15

16 Balance Sheet 16

17 Balance Sheet Market Shares: CGD leader in Portugal % CGD 27% Deposits from: CGD 21% Credit to: Individuals (Mortgage) 26% Total Individuals 31% Total Individuals (Total) 23% Corporates 12% Corporates 18% Customer Deposits Portugal August 2017 Loans and Adv. to Customers Portugal August

18 Balance Sheet Customer Resources grow in Portugal M 3,1% Total 69,351 Deposits - Corporate 6,645 Deposits - Individual Customers 44, Deposits - General Government and Institut. 2,976 Treasury Bonds 2,520 Investment Funds Bancassurance 4,516 7,382 Bonds 1,193 67,278 69,351 14,094 15,610 Total 67,278 Deposits - Corporate 6,324 Deposits - Individual Customers 45, Deposits - General Government and Institut. 1,374 Treasury Bonds 1,415 Investment Funds Bancassurance 4,164 7,265 Bonds 1,251 53,184 53, Other Customer Resources Customer Deposits Total Customer Resources Domestic Activity 18

19 Balance Sheet Credit in Portugal follows market trend M Total 48,714 Corporates 15,957 Institutionals and Others 1,218 General Government 4,501 Individual customers - Mortgage loans 26,158 Individual customers - Other loans Total 51,453 Corporates 17,700 General Government 4,750 Institutionals and Others 1,002 Individual customers - Mortgage loans 27,064 Individual customers - Other loans Loans and Advances to Customers (Gross) - CGD Portugal 19

20 Asset Quality 20

21 Asset Quality Reduced Cost of Credit Risk M % % % Credit impairment net of reversals Cost of Credit Risk 21

22 Asset Quality with NPE and NPL decreasing % % 10.1% 15.8% 13.3% 10.5% 9.6% Impairments and Collateral 87.8% 90.7% 91.8% 95.5% 79.0% 76.7% Impairments 52.9% 53.4% 52.8% 53.4% (1) (1) NPE NPL Credit at Risk Gross Ratios (1) (1) (2) NPE NPL Credit at Risk Coverage by Impairments and Collateral (1) NPE Non Performing Exposure EBA definition NPL Non Performing Loans EBA definition; (2) Ratio as defined by Bank of Portugal Instruction 23/2012, coverage by impairment only. 22

23 Asset Quality Strong action on NPL reduction B NPL (1) (1) Sales Write-offs Other NPL NPL evolution (1) NPL Non Performing Loans EBA definition. 23

24 Asset Quality Foreclosed Assets (Real Estate) M % 1,112 1,061 45% 48% Foreclosed Assets (Real Estate) Coverage by Impairments 24

25 Liquidity 25

26 Liquidity ECB funding stabilized and ECB Eligible Assets Pool strengthened M 3,110 2,766 3,527 3,397 12,348 12,212 12,262 4,447 13,627 4,387 2,642 3,692 3,186 3, ,073 2, ECB Funding Eligible Assets in ECB Pool 26

27 Liquidity with Wholesale Debt maturities fully covered M 1,041 1, ,089 Total 13,627 Eligible Assets Pool Annual maturities of Wholesale Debt 27

28 Liquidity Solid funding structure based on retail funding % M 90% 88% Central Banks and Credit Instit. 6% 64,202 71,322 59,575 67,786 Other 9% 86,335 M Debt Securities and Subordinated Liabilities 6% Funding Structure Customer Resources 79% Loans-to-Deposits Ratio Loans and Adv. to Customers (net) Customer Deposits 28

29 Liquidity with comfortable Liquidity Coverage Ratio (LCR) % % 204% 146% Regulatory requirement: 80% in January % in January 2018 LCR EU average (June 2017) Liquidity Ratio 29

30 Capital 30

31 Capital Recapitalisation strengthens solvency % 13.0% 12.8% 14.1% 13.8% 11.75% 14.8% 14.0% 9.75% 1.25% CCB P2R 8.25% 1.25% 2.50% AT1 1.25% 2.50% Tier % 2.00% 1.50% 1.50% Min. CET1 4.5% 4.5% 4.5% SREP Requirement Phased-in Fully Implemented SREP Requirement Phased-in Fully Implemented SREP Requirement Phased-in CET 1 Tier 1 Total Fully Implemented SREP 2017 Requirements and CGD Capital Ratios in 3 rd Quarter

32 Capital with gradual improvement of capital position throughout 2017 % % 12.8% 13.0% 14.2% 14.6% 14.8% CET 1 Total Capital Ratios evolution (Phased-in) 32

33 Capital High Risk Weighted Assets (RWA) density, Texas Ratio improves % 100% 91% 80% 74% 60% 58% 56% RWA Density Texas Ratio (1) (1) Texas Ratio = Non Performing Exposure EBA / (Impairments + Tangible Equity). 33

34 Capital Available Distributable Items (ADI) and Maximum Distributable Amount (MDA) B % 33 x Annual Cost AT1 (1) 31 x Annual Cost AT1 (1) % 8.25% MDA Buffer: 4.8% 2.5 B (2) 13.0% 10.01% MDA Buffer: 3.0% 1.6 B CET Requirement 2017 CET Requirement Gaps Tier 1 and Tier 2 ADI (Available Distributable Items) MDA (Maximum Distributable Amounts) (1) 10.75% coupon for current 500 M AT1 issuance; (2) Considering Buffers of 1.5% in T1 and 2% in T2 fullfilled. 34

35 Executive Summary 1. Adequate Capital Ratios Following the Recapitalisation Plan, in September 2017 CGDs phased-in capital ratios were 13.0% (CET1), 14.1% (Tier 1) and 14.8% (Total). 2. Efficiency and Profitability The referred to capital levels allowed an effective start of the implementation of the Strategic Plan, with visible results on the interest margin, costs and recurrent income, allowing the significant provisioning of restructuring costs. 3. Asset Quality - Positive evolution in 3 rd quarter 2017 of NPE and NPL ratios and its coverage by impairments and collateral, in line with the Strategic Plan. 4. Liquidity - CGD maintained a highly comfortable liquidity position with total financing from the ECB remaining stable (fully under TLTRO II). ADI and MDA levels remained high. 35

36 Disclaimer This document is intended to disclose general information, and does not constitute investment recommendation or professional guidance, nor can be interpreted as such. The values refer to 30 September 2017, except otherwise stated. CAIXA GERAL DE DEPÓSITOS Head Office : Av. Joao XXI, LISBOA PORTUGAL (+351) Share Capital 3,844,143,735 CRCL and Tax no INVESTOR RELATIONS OFFICE investor.relations@cgd.pt 36

37 Thank You