Anadolu Hayat Emeklilik A.s. · BIST:ANHYT
Anadolu Hayat Emeklilik A.s — Investor Presentation (March 2019)
46 slides from Anadolu Hayat Emeklilik A.s's investor presentation, March 2019
Slide 1: Investor Presentation
Investor Presentation Istanbul, Turkey – March 2019
Slide 2: Agenda
Agenda 1. Turkey at a Glance 2. Our Markets • Private Pension System • Life Insurance 3. Corporate Profile 4. Financial Results 2
Slide 3: Turkey at a Glance
Turkey at a Glance r
Slide 4: Turkey at a Glance: A Fast Growing Economy
Turkey at a Glance A Fast Growing Economy CPI*** and Interest Rates**** 6% GDP Average Annual Growth* 25% 5% 20% 4% 15% 3% 10% 2% 5% 1% 0% 0% 1990-1999 2000-2009 2010-2016 Turkey OECD Euro-15 CPI Interest Rates Budget Balance (% of GDP)** 0% -1% -2% -3% -4% -5% -6% Euro Area EM Turkey 4 * OECD Natio
Slide 5: Urgent Need to Increase Domestic Savings
Turkey at a Glance Urgent Need to Increase Domestic Savings 6% Current Account Balance (% of GDP)* 1.250 Weight of Pension Funds in Household Savings (TRY billion)** 7% 4% 6% 2% 1.000 5% 0% 750 4% -2% -4% 3% 500 -6% 2% -8% 250 1% -10% 0 0% 2011 2012 2013 2014 2015 2016 2017 2018Q3 Pension Funds Tota
Slide 6: Demographic Opportunity Window
Turkey at a Glance Demographic Opportunity Window Population By Age 9% 8% 2018 2060 7% Population (millions) : 82.0 107.1 6% Median Age : 32.0 42.3 5% 4% Fertility : 2.10 1.65* 3% Proportion of Elderly Population : 8.8% 22.6% 2% 1% 0% 2018 2060 2019 January Decreasing fertility and increasing longev
Slide 7: Our Markets
Our Markets Private Pension System Life Insurance
Slide 8: Private Pension System: Positioned in Pillar III
Our Markets Private Pension System: Positioned in Pillar III Three-Pillar System Pillar I Pillar II Pillar III State Pension Occupational Private Pension Mandatory Pension Voluntary Securing a minimum Workplace Pensions Opportunity to standard of living with Auto Enrolment increase retirement starti
Slide 9: Pillar III Private Pension System: Important Features
Our Markets Pillar III Private Pension System: Important Features Funds are managed by Started in 2003. asset management 17 companies in 2018. companies. Defined contribution and Minimum retirement age: 56 voluntary participation. Completion of 10 years. Participants can switch funds, Incentives for
Slide 10: Pillar III Private Pension System: Well Designed Structure
Our Markets Pillar III Private Pension System: Well Designed Structure Regulation Administration Monitoring ✓ Capital Markets ✓ Pension ✓ Pension Board (SPK) Accounts Monitoring Center Administered by (EGM) ✓ Undersecretariat Pension of Treasury Companies ✓ ISE Settlement and Custody ✓ Ministry of L
Slide 11: Pillar III Private Pension System: Incentives
Our Markets Pillar III Private Pension System: Incentives For Participants For Employers Contribution Stage Investment Stage Benefit Payments Employer contributions are tax deductible up to 15% of gross salary with a cap of • Contributions with a cap of • Investment income of • Withholding tax appli
Slide 12: Pillar III Private Pension System: Charging Structure
Our Markets Pillar III Private Pension System: Charging Structure Management Fee / Entrance Fee Fund Management Fee First 5 years of the contracts No change in fund management fee levels. A new rebate structure will be implemented by 2021. Maximum limit: 8.5% of the Fund Management Fees monthly lega
Slide 13: Growth Accelerated with Increased Government Support
Our Markets Pillar III Private Pension System: Growth Accelerated with Increased Government Support • 25% State Contribution since 2013 Under Discussion Implemented • Withholding tax limited to capital gains • Pension fund transfers from provident funds* by the end of 2017 • Severance Payments • Fee
Slide 14: Pillar III Private Pension System: Big Growth Potential
Our Markets Pillar III Private Pension System: Big Growth Potential Pension Funds as a Percentage of GDP Pension Participants Social Security Participants 0% 25% 50% 75% 100% 125% 150% 175% 200% 6.8 Million 22.1 Million Netherlands Iceland Switzerland Australia United Kingdom United States Canada Ch
Slide 15: Attractive Market
Our Markets Attractive Market The Number of Companies* Foreign Investment Share 19 19 74% 18 18 18 73% 17 69% 65% 65% 63% 61% 14 13 54% 53% 10 52% 9 45% 37% 39% 6 6 36% 5 4 4 4 2010 2011 2012 2013 2014 2015 2016 2017 2010 2011 2012 2013 2014 2015 2016 Life Private Pension Paid-In Capital GWP The pen
Slide 16: Pillar III Private Pension System: Key Highlights
Our Markets Pillar III Private Pension System: Key Highlights Total Amount of Contributions Distribution of Contributions Key Figures by Contract Type by Marketing Channel Participants : 6.8 Million (2017 total) Individual Participant Funds : TRY 80.1 Billion 75,7% State Contribution Funds : TRY 11.
Slide 17: Private Pension System: Pension Funds
Our Markets Private Pension System: Pension Funds* Repo and International Money Securities Market 2,2% Instruments Nominal & Real Investment Return of Pension Funds 14,2% 23,9% 23,3% 19,6% 18,4% 17,9% 15,8% 14,5% 15,4% 13,3% 12,5% 11,0%11,1% 9,6% 11,0% 10,9% 9,2% 9,5% 5,9% 3,0% 3,0% 2,2% 3,1% 3,5% E
Slide 18: Private Pension System: New Frontiers
Our Markets Private Pension System: New Frontiers Simplification of Auto Enrolment Fund Choices Severance Payments 18
Slide 19: Auto Enrolment: Basic Features
Our Markets Auto Enrolment: Basic Features* Automatic Minimum State contribution: enrolment of contribution • 25% on contributions current and new amount • 1,000 TRY initial bonus • 5% of assets at employees under set as annuity phase age 45 %3 of monthly wage Structural changes Gradual Simplified a
Slide 20: Auto Enrolment System: Incentives
Our Markets Auto Enrolment System: Incentives For Participants Contribution Stage Investment Stage Retirement Stage • Additional state contribution equal to 5% of • Contributions with a cap of annual legal • Investment income of auto enrolment funds savings at retirement date is provided in minimum
Slide 21: Auto Enrolment System: Charging Structure
Our Markets Auto Enrolment System: Charging Structure Management Fee / Entrance Fee Fund Management Fee No management or entrance fee. Fund management fee level is capped. According to the Law enacted in Fund Management Fee is capped at August 2016, no management or a maximum of 0.85%. entrance fee
Slide 22: Auto Enrolment - New Target Market
Our Markets Auto Enrolment - New Target Market SOCIAL SECURITY PARTICIPANTS (4A&4C) 1.6 Million 3.0 Million WORKFORCE* (4a public sector) (4c public sector) Eligible Employees Social Security Participants 12.6 Million (age less than 45)** (4a&4c) (4a private sector) 13 Million 17.3 Million Social Se
Slide 23: Auto Enrolment – Market Preview
Our Markets Auto Enrolment – Market Preview Date Target Staging Process 2017 January Private companies with 1,000+ employees Sixth phase of Auto Enrolment has been started as at January 1st 2019. Private companies with 250-999 employees 2017 April The employees of private companies over 5 Public adm
Slide 24: Life Insurance: Underpenetrated Market
Our Markets Life Insurance: Underpenetrated Market Life insurance market has great potentials in Turkey. Turkey’s life insurance market is extremely Insurance Premium per Capita (USD) underpenetrated as life premiums’ weight in GDP is only Global Comparison (2016) 1/20 of OECD average. Low penetrati
Slide 25: Life Insurance
Our Markets Life Insurance Life Insurance Total GWP Life Insurance GWP (TRY million) (by Product Category) 6.900,00 6.766 6.835 50% 36% 40% 5.900,00 30% 4.963 4.900,00 20% 34% 1% 3.701 10% YoY (TOTAL) : 8% Term Life : 1% 3.900,00 3.229 0% Endowment / Saving : 74% 15% 2.900,00 Annuity : 193% -10% -20
Slide 26: Corporate Profile
Anadolu Hayat Emeklilik Corporate Profile 26
Slide 27: At a Glance
Anadolu Hayat Emeklilik At a Glance SECTOR’S SECTOR’S LEADER LEADER Life and Private Private Pension Pension Funds Contracts ❖ Established in 1990 as a subsidiary of İşbank TRY 19.2 Billion 1.3 Million ❖ First life insurance company in Turkey ❖ The first publicly traded Life & Pension Company since
Slide 28: At a Glance
Anadolu Hayat Emeklilik At a Glance Headquartered in Istanbul Customer Service Center in İstanbul I Organization 11 District Sales Offices Branch Office in TRNC HQ and Regions : 567 Human II Resources Direct Sales Team : 509 Total : 1,076 Total Assets : TRY 20,861 million Financial Shareholders’ Equ
Slide 29: Financial Highlights
Anadolu Hayat Emeklilik Financial Highlights (Million TRY) 2017 2018 Change 2018Q1 2019Q1 Change Total GWP and Net Contributions 2,203.7 2,019.0 -9% 619.9 496.16 -20% Life Mathematical Provisions 1,725.7 1,740.3 1% 1,709.7 1,715.2 0% Pension AUM 14,712.8 16,937.6 15% 15,314.5 17,533.7 14% Total Asse
Slide 30: Lines of Business
Anadolu Hayat Emeklilik Lines of Business Lines of Business Pension Funds Conservative Balanced Dynamic Aggressive Non- Employer Income Private Individual Sponsored Sponsored Drawdown Pension Plans Group Group Plans • Money Market • Bond • First Debt • Equity Fund Plans Plans • Conservative • Balanc
Slide 31: Distribution Network
Anadolu Hayat Emeklilik Distribution Network Private Pensions New Business Channel Mix (Contributions) – 2019Q1 26 District Sales Offices 1,333 Branches 2.400 Licensed Intermediaries 62 Licensed Tele-Sales Agents 229 Agencies 377 Licensed Intermediaries Tele Sales İşbank 3,5% (Branch+DS+TS) 85,8% Ag
Slide 32: Deep Bench with Lots of Talent
Anadolu Hayat Emeklilik Total Number Deep Bench with Lots of Talent of Employees: 1,076 Young & Energetic Educated Diverse 18-24 6% Primary Level 0,4% 25-29 26% Female 62% High School 2,3% 30-34 33% University 90% Male 38% 35-39 21% 40-44 9% Graduate 7,4% 45-49 4% 50+ 2% 32
Slide 33: Corporate Strategy
Anadolu Hayat Emeklilik Corporate Strategy Become the market leader among private pension and life insurance companies Finance Become both the private Optimize operational Optimize ROE and risk pension and life insurance profitability and efficiency portfolio market leader Optimize customer and prod
Slide 34: Strong Infrastructure
Anadolu Hayat Emeklilik Strong Infrastructure Core System Transformation Project Digital Corporate Identity The first phase of the (AHEŞUBE, AHEMOBİL, AHEPAD) Financial Systems transformation project to serve Transformation (GL / FAH) private pension operations established in February 2017 including
Slide 35: Perfect Customer Experience
Anadolu Hayat Emeklilik Perfect Customer Experience Customer Experience Projects & Operational Excellence Among the vision of ‘Perfection in Customer Experience’, there are 7 ongoing projects. Operational Excellence anadoluhayat.com.tr Mobile App Internet Branch Brand Language Chat Bot Robo Advisor
Slide 36: Focus on Customer Retention
Anadolu Hayat Emeklilik Focus on Customer Retention Continuity Index (%) 100 99 98 97 Jul-04 Jul-13 Jul-05 Jul-06 Jul-07 Jul-08 Jul-09 Jul-10 Jul-11 Jul-12 Jul-14 Jul-15 Jul-16 Jul-17 Jul-18 Jan-09 Jan-18 Jan-04 Jan-05 Oct-05 Jan-06 Jan-07 Jan-08 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-
Slide 37: A Strong Brand Name
Anadolu Hayat Emeklilik A Strong Brand Name Anadolu Hayat Emeklilik has «Best corporate been recognized by Celent as transformation» award a winner of a Model Insurer by International Data 2018 award for «Legacy and Corporation (IDC) Turkey Ecosystem Transformation».* Turkey’s first company to recei
Slide 38: Strong Market Positioning in Private Pensions
Anadolu Hayat Emeklilik Strong Market Positioning in Private Pensions Participants Assets Under Management (TRY million) 17% 17% 17% 17% 16% 16% 16% 20% 19% 19% 19% 19% 19% 18% Market Share Market Share 20.000,00 1.400.000,00 17.534 18.000,00 16.379 1.120.505 1.148.956 1.113.878 1.146.723 1.102.002
Slide 39: Strong Market Positioning in Life Insurance
Anadolu Hayat Emeklilik Strong Market Positioning in Life Insurance Life Insurance GWP (TRY million) Term Life GWP (TRY million) 11% 11% 10% 8% 9% 8% 6%* 2019 Q1 7% 8% 9% 7% 7% 6% 5%* Market Share Market Share 700,00 639,2 Saving/ 574,7 Endowment Term 459,4 25% 449,9 500,00 600,00 500,6 Life 72% 450
Slide 40: Statutory Financials
Anadolu Hayat Emeklilik Statutory Financials Gross Profit for the Period (TRY Million) Shareholders’ Equity and Capital Adequacy Ratio (TRY Million) 553% 430% 408% 381% 361% Capital Adequacy Ratio 350,00 322,2 1400 300,00 279,8 1200 949 968 229,8 877 250,00 1000 200,00 175,9 800 789 710 150,00 134,8
Slide 41: Statutory Financials: Dividends
Anadolu Hayat Emeklilik Statutory Financials Net Distributable Profit / Dividend to Shareholders (TRY Million) Dividend Payout Ratio (%) 0.16 0.24 0.33 0.40 0.30 Dividend per Share Gross (TRY) 300 77 75 255 250 70 67 221 200 186 170 51 150 142 140 130 100 100 90 60 50 0 2014 2015 2016 2017 2018 2014
Slide 42: Statutory Financials: Operating Expenses
Anadolu Hayat Emeklilik Statutory Financials Technical Profit / Operating Expenses (TRY Million) Operating Expenses – 2019 Q1 500,00 440,1 450,00 Commission 400,00 Expenses 352,5 350,00 318,9 40% 300,00 270,4 241,7 237,6 250,00 199,2 200,00 Administration 133,0 Expenses 150,00 108,3 117,7 99,8 20% 1
Slide 43: Summary of Income Statement
Anadolu Hayat Emeklilik Statutory Financials Summary of Income Statement (mio TRY) 2014 2015 2016 2017 2018 CAGR 2018Q1 2019Q1 YOY Non-Life Technical Profit / Loss -0.03 -0.24 -0.57 -0.54 -1.08 - -0.25 -0.09 -60% Life Technical Profit / Loss 63.80 86.48 112.49 132.61 151.10 24% 40.79 42.56 4% Pensio
Slide 44: Pension Technical Profit
Anadolu Hayat Emeklilik Statutory Financials Pension Technical Profit (mio TRY) 2014 2015 2016 2017 2018 CAGR 2018Q1 2019Q1 YOY Pension Technical Income 166.57 209.06 236.76 300.55 369.19 22% 87.34 100.88 16% 1- Fund Management Income 113.57 144.26 173.82 216.74 256.42 23% 61.60 68.61 11% 2- Managem
Slide 45: Life Technical Profit
Anadolu Hayat Emeklilik Statutory Financials Life Technical Profit (mio TRY) 2014 2015 2016 2017 2018 CAGR 2018Q1 2019Q1 YOY Life Technical Income 550.43 602.51 700.85 741.97 1.004.27 16% 218.17 274.98 26% 1- Earned Premiums (Net of Reinsurer Share) 353.32 391.78 475.43 544.07 625.55 15% 152.47 172.
Slide 46: www.anadoluhayat.com.tr
www.anadoluhayat.com.tr investorrelations@anadoluhayat.com.tr DISCLAIMER The information in this document has been obtained by Anadolu Hayat Emeklilik A.Ş. from sources believed to be reliable, however, Anadolu Hayat Emeklilik A.Ş. cannot guarantee the accuracy, completeness or correctness of such i
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