Cembra Money Bank Ag · SIX:CMBN
Cembra Money Bank — ZKB Swiss Equities conference 2023
34 slides from Cembra Money Bank's conference presentation, Nov 2, 2023
Slide 1: Cembra - a leading player in financing solutions and services in Switzerland
Cembra - a leading player in financing solutions and services in Switzerland Holger Laubenthal, CEO ZKB Swiss Equities conference, 2 November 2023
Slide 2: Agenda
Agenda 1. Cembra at a glance 2. Business performance 3. Outlook Appendix 2 November 2023 Investor presentation C e m bra
Slide 3: Cembra at a glance
Cembra at a glance Cembra at a glance A leading provider of financing solutions and services in Switzerland Over 1 million customers Decades of experience in Leading positions Excellent track record in Switzerland Swiss consumer finance in selected markets on execution Outstanding performance 15% 4%
Slide 4: Market positions
Cembra at a glance Market positions Serving more than 1 million customers in Switzerland Personal loans: 39% market share Auto business: 21% market share Credit cards: 12% market share BNPL: 30-40% market share 30 June 2023, personal loans market 30 June 2023, leasing receivables April 2023, credit
Slide 5: Strategy 2022 – 2026: Reimagining Cembra
Cembra at a glance Strategy 2022 – 2026 Reimagining Cembra Key messages Strategic ambition We will leverage technology to deliver the most intuitive customer solutions in consumer finance Cembra’s We will draw on the strengths of our world-class credit factory and our leadership Core DNA in selected
Slide 6: Embedded finance
Cembra at a glance Embedded finance Ongoing gradual shift to financing at purchase and post-purchase Traditional Embedded finance money lending Embedded finance presence Instrument Pre-purchase at purchase post-purchase Personal loans Unsecured loans Auto leasing and loans Leasing/loan product t
Slide 7: Long-term risk performance
Cembra at a glance Long-term risk performance High quality of assets – loss performance resilient through economic cycles Loss rate NPL and delinquencies1 Reported Adjusted for one-off 3% 30+ days past due 2% 1.1 1.0 1.0 1% Non-performing loans (NPL) 0.8 0.9 0.9 0.7 0.7 0.5 0.5 0% Jun’08 Jun’09 Jun’
Slide 8: Sustainability
Cembra at a glance Sustainability Strong ESG performance and ratings, and commitment to further improve Selected sustainability performance targets External recognition Reduce Scope 1+2 carbon emissions Low ESG risk E by 75% by 2025 (basis: 2019) Top 8% (score 16.1) among >200 consumer finance peers
Slide 9: Dividends
Cembra at a glance Dividends More than CHF 1 billion dividends paid out since the IPO in 2013 Dividends CHF per share Extraordinary dividend from excess capital 4.45 3.85 3.95 3.55 3.75 3.75 3.75 • Total CHF 1.05 billion dividends 3.35 3.10 paid out since the IPO in 2013 2.85 • 68% average payout ra
Slide 10: Agenda
Agenda 1. Cembra at a glance 2. Business performance 3. Outlook Appendix 10 November 2023 Investor presentation C e m bra
Slide 11: H1 2023 performance
Business performance H1 2023 performance Solid first half year Highlights Net income Net financing receivables Net revenues in CHF m in CHF m in CHF m • Net income of CHF 75.1 million, Net interest income 17% lower due to normalisation of +2% Commission and fees -17% loss performance and investment
Slide 12: H1 2023 operational highlights
Business performance H1 2023 operational highlights Progress in strategy implementation Overall resilient performance • Focused on selective growth; higher fees compensated lower net interest income • Repricing measures successfully being implemented • Continued disciplined risk, funding and expense
Slide 13: H1 2023 products and markets
Business performance H1 2023 products and markets Focus on profitable growth Personal loans Auto loans and leases Credit cards Buy now pay later (BNPL) Consumer loans market, in CHF bn Leasing market, in CHF bn Transaction volumes, in CHF bn eCommerce market, in CHF bn (full year) (first four months
Slide 14: H1 2023: Net revenues
Business performance H1 2023: Net revenues Funding cost increase fully offset by repricing and increase in fee income Net revenues Comments In CHF m 265 • Net revenues: increased interest expenses were fully offset by additional income sources in H1 2023 (as guided in February) 260 255 12 253 • Incr
Slide 15: H1 2023: Funding
Business performance H1 2023: Funding Balanced and diversified funding profile Funding mix Funding instruments In CHF m1 6,133 6,340 AT1 subordinated One issuance, remaining term to first call of 1.5 years 5,700 150 250 150 at a rate of 2.50%4 Non-deposits – 49% 150 250 250 1,970 2,165 Convertible b
Slide 16: Agenda
Agenda 1. Cembra at a glance 2. Business performance 3. Outlook Appendix 16 November 2023 Investor presentation C e m bra
Slide 17: Execution on strategy 2022–2026
Outlook Execution on strategy 2022–2026 Progress in H1 Our strategic ambition Review of key initiatives H1 2023 Ongoing key initiatives 2023 • Executing on core banking system for leasing wip1 • Establish core banking system readiness Operational implementation • Roll out New Workplace 365 (phase
Slide 18: Outlook
Outlook Outlook Continued resilient business performance expected in 2023 Outlook 20231 Financial targets until 20262 Deliver on strategic milestones Tier 1 capital ratio ROE Dividend per share • Continue repricing measures and transition to Certo! 2023: 13–14% 2023: >17% for 2023: ≥ CHF 3.95 • Deli
Slide 19: Appendix
Agenda Appendix 19 November 2023 Investor presentation C e m bra
Slide 20: Macroeconomic outlook
Appendix Macroeconomic outlook Swiss economy remains resilient GDP in Switzerland Swiss vs. Eurozone CPI Inflation CHF interest rates Swiss unemployment rate Change vs. previous period as % End-of-period 3-year swap rates as % As %, average per period 10 8.4 6 8 4.2 Switzerland 4 1.91 5 6 5.4 2 1.69
Slide 21: H1 2023: Profitability by source
Appendix H1 2023: Profitability by source Decline of net interest margin offset by growing share of fee business Return on financing receivables 2.5% +0.3pp 2.8% -0.6pp 2.2% Comments H1 2023 + Net revenues • Net interest income affected by higher interest 5.5% 5.1% expenses, partly compensated by pr
Slide 22: H1 2023: P&L
Appendix H1 2023: P&L In CHF m H1 2023 H1 2022 as % Comments Interest income 200.9 188.9 6 1 Higher interest income driven by price 3 Increase driven by the acquisition of Interest expense -30.3 -12.3 >100 increases in Auto and Personal loans as Byjuno and organic growth at Swissbilling Net interest
Slide 23: H1 2023: Operating expenses
Appendix H1 2023: Operating expenses In CHF m H1 2023 H1 2022 as % Comments Compensation and benefits 1 69.7 67.1 4 1 Increase in line with higher number of 6 Driven by branch closures in 2022 Professional services 2 11.0 8.7 26 FTEs mainly related to the Byjuno acquisition, with 30 FTE in Riga, Lat
Slide 24: Credit cards
Appendix Credit cards About 60% of transition portfolio migrated, in line with expectations FY 2023 credit cards guidance H1 2023 cards vs 2019 pre-Covid Co-branding and proprietary card offerings Transaction volume • Cembra expects cards assets and revenues -2% to at least be in line with pre-Covid
Slide 25: H1 2023: Net financing receivables
Appendix H1 2023: Net financing receivables In CHF m Net financing receivables Personal loans Auto leases and loans Credit cards Net financing receivables Net financing receivables Net financing receivables +2% +3% +1% 2,920 2,975 3,068 -3% 2,338 2,387 2,411 1,110 1,045 1,014 30.06.22 31.12.22 30.06
Slide 26: H1 2023: Balance sheet
Appendix H1 2023: Balance sheet In CHF m Assets 30.06.23 31.12.22 as % Comments Cash and equivalents 600 633 -5 1 Day-1 increase of 64m due to adoption of 3 Funding increased largely in line with Financing receivables 6,780 6,612 3 CECL in US GAAP (see appendix p25) growth in financing receivables A
Slide 27: H1 2023: Capital position
Appendix H1 2023: Capital position Strong Tier 1 capital ratio of 17.6% and attractive dividend policy Tier 1 capital walk1 Risk-weighted assets In CHF m In CHF m 17.8% 17.6% +2% 56 15 1,068 1,055 6,080 -58 5,938 31 Dec 2022 Statutory Dividend 2 Goodwill & other 30 Jun 2023 31 Dec 2022 30 Jun 23 net
Slide 28: Current expected credit losses (CECL)
Appendix Current expected credit losses (CECL) US GAAP implementation as of 1 January 2023 Change from incurred to expected credit loss standard Financial impact Implementation of CECL as of 1 Jan 2023, based on US GAAP ASC 326, required by Main differences FASB and as of 31. Dec 2022 under FINMA Ac
Slide 29: History
Appendix History Foundation –“Banque Launched credit Launched saving First public IPO at SIX Launched eny Finance Launched Updated Acquisition commerciale et agricole cards through products for retail Auto ABS Swiss FNAC cards transaction IKEA cards strategy of Byjuno E. Uldry & Cie” in Fribourg Mig
Slide 30: Glossary of key figures
Appendix Glossary of key figures including alternative performance measures To measure its performance, Cembra uses some key figures that are not defined under US GAAP. This glossary provides definitions of alternative performance measures (APM) and other key figures Key figures (including APM) Defi
Slide 31: Key figures over 10 years
Appendix Key figures over 10 years US GAAP 2014 2015 2016 2017 2018 2019 2020 2021 2022 H1 2023 Net revenues (CHF m) 379 389 394 396 439 480 497 487 509 253 Net income (CHF m) 140 145 144 145 154 159 153 161 169 75 Cost/income ratio (%) 42.5 41.5 42.5 42.4 44.0 48.3 49.8 50.6% 50.6% 53.2% Net fin re
Slide 32: The Cembra share
Appendix The Cembra share Shareholder structure Institutional owners by domicile1 Based on nominal share capital of CHF 30m, as % Others Own shares UK 7% 2% 8% ~18,000 registered 23% private shareholders EU 10% 55% Switzerland 20% 75% US incl. CND ~1,100 institutional investors Main investors and in
Slide 33: Cautionary statement regarding forward-looking statements
Appendix Cautionary statement regarding forward-looking statements This presentation by Cembra Money Bank AG (“the Group”) includes forward-looking statements that reflect the Group’s intentions, beliefs or current expectations and projections about the Group’s future results of operations, financia
Slide 34: Calendar and further information
Calendar and further information Visit us at www.cembra.ch/investors Corporate events Investor conferences, roadshows and calls 22 February 2024 FY 2023 results 2 November 2023 ZKB Swiss Equities conference, Zurich 14 March 2024 Publication 2023 Annual Report 11 January 2024 Baader Swiss Equities co
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