Banco Del Bajio Sa · BMV:BBAJIO/O

Banco Del Bajio Sa — Q3 2018 Earnings Presentation

23 slides from Banco Del Bajio Sa's earnings presentation, November 2018

  1. Slide 1: Eventos Relevantes

    Eventos Relevantes FECHA: 12/11/2018 BOLSA MEXICANA DE VALORES, S.A.B. DE C.V., INFORMA: CLAVE DE COTIZACIÓN BBAJIO RAZÓN SOCIAL BANCO DEL BAJÍO, S.A., INSTITUCIÓN DE BANCA MÚLTIPLE LUGAR León, Guanajuato 12 de octubre de 2018 ASUNTO Presentación corporativa BanBajío, cifras III trimestre 2018. EVEN

  2. Slide 2: A Leading Specialized Bank set for Long-Term Profitable Growth

    A Leading Specialized Bank set for Long-Term Profitable Growth Corporate Presentation November | 2018

  3. Slide 3: Disclaimer

    Disclaimer The material that follows presents general background information about Banco del Bajío, S.A., Institución de Banca Múltiple (the “Company” or “BanBajio”) as of the date of the presentation. This information consists of publicly-available information concerning the Company. It is informa

  4. Slide 4: Guidance

     Guidance 2018 Original 2018 Revised ▪ Loan Growth 12 % - 14 % 14 % - 16 % ▪ Deposits Growth 12 % - 17 % 15 % - 19 % ▪ NIM 5.5 % - 5.6 % 5.6 % ▪ Revenues, Net of Reserves 20 % - 21 % 23 % - 25 % ▪ Expenses Growth 15 % - 16 % 16 % - 17 % ▪ Efficiency Below 45% Below 44% ▪ Cost of Risk Below 1.0 % Be

  5. Slide 5: Evolution from an emerging local bank to a specialized leader with national presence

    Evolution from an emerging local bank to a specialized leader with national presence ◥ BanBajio Today ◥ BanBajio’s History in Four Phases Evolution of Branch Network (#) ✓ 3rd largest locally-controlled bank in Mexico(1), with ~US$11.8 Bn(2) in total assets. 1 Founding 2 Diversification 3 Growth 4

  6. Slide 6: Our well-invested platform allows us to offer a full multi-channel solution to our customers

    Our well-invested platform allows us to offer a full multi-channel solution to our customers ◥ Branch Distribution by Region 12 North Center 28 North 18 Northwest 303 Branches 28 States 9 Aguascalientes 79 Cities 12 San Luis Potosi 15 Pacific 15 Queretaro 48 Southwest 33 Metropolitan North Corporat

  7. Slide 7: Specialized Bank on SME and Corporate Loans

    Specialized Bank on SME and Corporate Loans ◥ BanBajio is Highly Specialized on SME and Corporate Loans ◥ BanBajio’s Unique Access and Capabilities to Better Serve Companies Company Loans as % of Total Loans │ 2Q18 1 Banregio 85% Deep and technical knowledge of our Bajio 82% customers and their bus

  8. Slide 8: Loan Portfolio, BanBajio's main asset

    Loan Portfolio, BanBajio’s main asset ◥ Loan Portfolio Breakdown | By Type 3Q17 | % 3Q18 | % Mortgage Consumer Mortgage Consumer Government 5% 1% Government 4% 1% Financial Institutions 7% Companies Financial Institutions 6% Companies 7% 80% 7% 82% Corporates Corporates SMEs SMEs 53% 52% 27% 30% ◥

  9. Slide 9: Loan Portfolio, BanBajio's main asset

    Loan Portfolio, BanBajio’s main asset ◥ Commercial portfolio Use 3Q18 | % • No consolidated 6.2 0.3 0.1 FIXED ASSETS 21.5 8.7 WORKING CAPITAL LIABILITIES PAYMENT 5.3 GOVERNMENT INFRASTRUCTURE 8.6 FINANCIAL INSTITUTIONS/FUNDING COMMERCIAL REAL ESTATE 49.3 HOUSING REAL ESTATE PUBLIC WORKS ◥ Commercia

  10. Slide 10: We have consistently maintained industry-leading asset quality

    We have consistently maintained industry-leading asset quality ◥ Best-in-Class Asset Quality 2Q18 │ % ◥ NPLs ◥ NPLs Adjusted for Write-Offs (1) Santander 2.46% HSBC 5.63% HSBC 2.26% Santander 5.58% Scotiabank 2.06% BBVA 5.16% Banamex 1.98% Citibanamex 5.15% Banorte 1.96% Banorte 4.04% BBVA 1.90% Sc

  11. Slide 11: Asset Quality

     Asset Quality ▪ High asset quality and outstanding risk profile ◥ NPL Ratio | % ◥ NPL Ratio adjusted | % 2.60 6.20 2.40 5.70 5.07 2.20 2.37 5.20 4.79 4.70 4.68 2.00 2.18 2.09 4.20 1.80 3.70 1.60 3.20 1.40 1.31 2.70 1.20 1.05 2.20 1.92 0.88 1.58 1.00 1.70 1.32 0.80 1.20 3Q16 3Q17 3Q18 3Q16 3Q17 3Q1

  12. Slide 12: Increasingly diversified and low-cost funding base

    Increasingly diversified and low-cost funding base ◥ Funding Breakdown | Ps$ Bn (1) (3) CAGR '15 -‘3Q18: 12.4% System 10.1% Low cost 183.0 funding 158.3 163.7 161.2 Notes 134.4 1% 1% 20% 7.2% Interbank Loans 1% 25% 23% 20% 7% (Primarily Development 25% 7% 7% Bank Loans) 10% 4% 40% 5.7% Repos 31% 36

  13. Slide 13: Continuous upward trend in Revenues

     Continuous upward trend in Revenues • Million Pesos ◥ Revenues ▪ Strong performance in Revenues 3,600 3,461 increasing 17.0% in 3Q18. 3,400 3,200 ▪ Financial Margin grew as a result 3,000 2,958 of an increase in volume and 2,800 interest rates. 2,600 2,400 2,200 2,132 2,000 3Q16 3Q17 3Q18 3Q18 YoY

  14. Slide 14: Historical Net Income Performance

     Historical Net Income Performance ▪ Net Income was Ps. 1,328 million in 3Q18, 27.8% higher than 3Q17. 9M18 was Ps. 3,708, 33.1% higher than 9M17. • Million Pesos 1,400 1,328 1,200 1,039 1,000 800 606 600 400 200 3Q16 3Q17 3Q18 13

  15. Slide 15: Strong Results boosted Returns and EPS

     Strong Results boosted Returns and EPS ◥ ROAE • Annualized quarter ▪ Strong Results drove the increase 20.1% in ROAE and ROAA. 20.0% 18.4% 18.0% ▪ Continuous growth in Earnings, resulted in a 60% increase in EPS 16.0% 14.7% since the IPO. 14.0% 12.0% 10.0% 3Q16 3Q17 3Q18 ◥ ROAA ◥ EPS • Annualized

  16. Slide 16: Net Interest Margin

     Net Interest Margin ▪ NIM expanded as a result of an increase in volume as well as the 25 bps adjustment in the reference rate. 6.00% 5.78% 5.50% 5.44% 5.00% 4.50% 3.97% 4.00% 3.50% 3.00% 3Q16 3Q17 3Q18 15

  17. Slide 17: Efficiency Ratio

     Efficiency Ratio ▪ A higher growth in revenues compared to expenses allowed us to maintain an adequate level of Efficiency Ratio in 3Q18. ◥ Efficiency Ratio Evolution vs. Peers ◥ Total Revenues and Expenses (1) Operating Expenses/Total Revenues (1) | % Ps$ MM | Quarterly $4,000 $3,500 3,461 $3,000

  18. Slide 18: Capital Adequacy Ratio

     Capital Adequacy Ratio ▪ Solid capitalization ratio with 98.4% TIER 1 18% 17% 16.75% * 16% 15.25% 15% 14% 13% 12.45% 12% 11% 10% 9% 8% 3Q16 3Q17 3Q18 * ICAP September 2018 preliminary 17

  19. Slide 19: Solid corporate governance standards

    Solid corporate governance standards ◥ Board of Directors Composition Non-Independent 46% Independent 54%  Total: 13 Members ◥ High Corporate Governance Standards ✓ Independent board members selected for their ample experience in banking, risks, economy and technology. ✓ Unique IT Board committee,

  20. Slide 20: Supplemental Financial Information

    Supplemental Financial Information

  21. Slide 21: Income Statement

     Income Statement Var. Ps$ MM 3Q17 2Q18 3Q18 YoY QoQ ▪ Interest Income $4,179 $4,776 $5,177 23.9 % 8.4 % ▪ Interest Expense (1,749) (1,994) (2,187) -225.0 % 9.7 % Financial Margin $2,430 $2,782 $2,990 23.0 % 7.5 % ▪ Net Fees & Commissions 380 440 422 11.1 % -4.1 % ▪ Trading Income 90 87 17 -81.1 %

  22. Slide 22: Income Statement

     Income Statement Var. Ps$ MM 9M 17 9M 18 YoY ▪ Interest Income $11,584 $14,439 24.6 % ▪ Interest Expense (4,863) (6,058) 24.6 % Financial Margin $6,721 $8,381 24.7 % ▪ Net Fees & Commissions 1,096 1,236 12.8 % ▪ Trading Income 214 171 -20.1 % ▪ Other Operating Income / (Expense) 150 129 -14.0 % No

  23. Slide 23: Balance Sheet

     Balance Sheet Var. Ps$ MM 3Q17 2Q18 3Q18 YoY QoQ ▪ Cash & Cash Equivalents $17,405 $18,243 $16,914 -2.8 % -7.3 % ▪ Investment in Securities 16,681 19,191 18,384 10.2 % -4.2 % ▪ Cash & Investments $34,086 $37,434 $35,298 3.6 % 5.7 % ▪ Performing Loan Portfolio 140,274 156,912 160,823 14.6 % 2.5 % ▪

Banco del Bajío — Q3 2018 Earnings Presentation on 6ix