Alior Bank Sa · GPW:ALR
Alior Bank Sa — Q1 2022 Earnings Presentation
44 slides from Alior Bank Sa's earnings presentation, Apr 27, 2022
Slide 1: Presentation of results for 1Q 2022
Alior Bank S.A. Presentation of results for 1Q 2022 Warsaw, April 27 2022
Slide 2: Agenda
Agenda 1. Operating activities 2. Financial results 3. Credit risk 4. Other issues 2
Slide 3: Operating activities
Operating activities 3
Slide 4: Another quarter of very good financial results – record-breaking revenues
Another quarter of very good financial results – a record-breaking level of revenues Total revenues (PLN m) +202 m +23% In 1Q 22, the revenues of Alior Bank Group was at PLN 1,093 m. This is the record-breaking level in Alior Bank’s history. Compared with 1Q 21 the revenues 1 093 increased by PLN 20
Slide 5: Stable growth of the Bank, consistent improvement in efficiency
Stable growth of the Bank, consistent improvement in efficiency Assets (PLN billion) Gross loan volume (PLN billion) Deposits volume* (PLN billion) +6% +2% +3% 84,6 70,8 63,4 79,9 62,1 68,6 1Q 21 1Q 22 1Q 21 1Q 22 1Q 21 1Q 22 ROE 1Q 22 NIM 1Q 22 TCR 1Q 22 11,9% 4,58% 14,56% +5,2 p.p. r/r +0,91 p.p.
Slide 6: Alior Bank – Digital Leader
Alior Bank – Digital Leader PERSONALISATION AI TOOLS • Screen personalisation like icons in iOS smartphones – Development and implementation of AI tools improving option to freely manage the layout of icons in the payment Clients’ service and increasing users’ experience in digital and services scre
Slide 7: ESG activities focused on social responsibility amid war in Ukraine
In connection with the war in Ukraine, we focused our ESG activities mainly in the area of social responsibility Social responsibility Dialogue and cooperation Dialogue and Cooperation Help for Ukrainians Alior Bank Foundation - Dedicated product offering, banking application - Help to refugees, stu
Slide 8: Growth of the Bank's key products – mortgage loans
RETAIL Growth of the Bank’s key products – mortgage loans* CUSTOMERS Sale of mortgage loans (PLN bn) Number of Customers with a mortgage loan (K) -10% +8% 1,40 75,5 76,0 0,94 1,20 0,90 0,88 74,1 0,75 1,00 0,80 0,67 72,3 0,60 70,5 0,40 0,20 0,00 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22 1Q 21 2Q 21 3Q 21 4Q 21 1
Slide 9: Growth of the Bank's key products – cash loans
RETAIL Growth of the Bank’s key products – cash loans* CUSTOMERS Number of Customers with a loan (K) Sale of loans (PLN bn) +1% -16% 421 417 411 409 1,69 1,61 405 1,43 1,35 1,20 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22 Gross consumer loan portfolio (PLN bn) • In the area of unsecu
Slide 10: Development of key products – Consumer Finance loans
RETAIL Development of the Bank’s key products - Consumer Finance (CF) loans CUSTOMERS Sale of CL loans (PLN billion) Number of CF Customers (K) -7% -6% 1,52 1600,00 1 403 1 353 1 303 1 367 1 324 1400,00 0,98 0,91 0,97 0,91 1200,00 1000,00 800,00 600,00 400,00 200,00 0,00 1Q 21 2Q 21 3Q 21 4Q 21 1Q 2
Slide 11: Effective building of a lasting relationship with Customers
RETAIL Effective building of a lasting relationship with Customers CUSTOMER Number of Individual Customers* (million) Number of accounts “Konto Jakże Osobiste” (thousand) -3% +25% 541 484 508 4,18 4,14 456 4,06 4,09 4,06 432 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22 Number of motor
Slide 12: Growth in digital channels importance
RETAIL Growth in digital channels importance CUSTOMER Users of Alior Bank mobile applications (thousand) Number of transfers ordered in the Alior Mobile application (million) +26% +23% 9,2 9,5 8,2 8,5 791 7,7 704 740 630 671 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22 Struktura korzy
Slide 13: Noticeable effects of improved sales and efficiency of the loan portfolio
BUSINESS Noticeable effects of improved sales and efficiency of the loan portfolio... CUSTOMERS Segment: Small / Medium / Large Micro segment Total overdraft facility granted (PLN billion) Total overdraft facility granted (PLN billion) +21% -7% 2,0 0,41 1,8 1,7 0,39 0,38 1,4 0,38 1,1 0,36 1Q 21 2Q 2
Slide 14: Improved x-sell and increase in Customer transactionality
BUSINESS ... supplemented by improved x-sell and increase in Customer transactionality CUSTOMERS Number of actively used cards (thousand) Number of cashless transactions with payment cards (million) +20% +4% 3,0 2,9 2,8 97,6 98,3 98,1 99,6 101,1 2,7 2,4 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22 1Q 21 2Q 21 3Q 2
Slide 15: Development of remote channels and automation of credit processes
BUSINESS Development of remote channels and automation of credit processes CLIENTS Remote support (Segment: Micro / Small / Medium / Large) Automated decisions (Segment: Small / Medium / Large) Sale of cards and auxiliary accounts in Online Banking New sales in automated decisions (PLN m) +135% +202
Slide 16: Financial results
Financial results 16
Slide 17: Profit and loss account
Profit and loss account PLN m 1Q 21 4Q 21 1Q 22 % y/y y/y % q/q q/q Total Income 891,4 934,8 1 093,2 23% 201,8 17% 158,4 Net interest income 670,2 757,9 862,4 29% 192,2 14% 104,5 Net fee and commission income 177,7 216,1 190,7 7% 13,0 -12% -25,4 Other income 43,5 -39,1 40,1 -8% -3,3 - 79,3 Total cos
Slide 18: Rising market interest rates have a positive effect on net interest income
The increase in market interest rates has a positive effect on the net interest income Interest income and expenses (PLN million) Interest margin and financing cost* +40% 4,58% +27% 1 046 4,01% 3,67% 3,77% 3,58% 126 824 745 718 750 84 Interest Cost 94 81 80 Other Interest Income 919 651 670 740 637
Slide 19: Customer transactions sustain a very high level of fee income
Thanks to the growth in Customer transactions, the Bank maintains a very high level of fee income Result on fees and commissions (PLN m) +7% -12% 216 190 191 Bank accounts, transfers, cash 183 operations (net) 178 49 45 +4% y/y 46 48 Bancassurance (net) 43 22 22 -2% y/y 25 25 22 Leasing, loans and a
Slide 20: Improving efficiency despite growing operating costs
Despite the growing pressure of increasing operating costs, the Bank is improving its efficiency Operating costs by quarter (PLN m) Normalised C/I ratio*** +18% +26% 493 44,2% 418 394 391 97 +54% y/y Employee expenses 379 43,8% 63 14 14 43,2% 15 57 +3% y/y General and administrative 57 61 59 56 42,8
Slide 21: Pursuit of the updated 'More than a Bank' strategy 2021–2022
Pursuit of the updated “More than a Bank” strategy 2021 – 2022 2020 2021 1Q 2022 Goal 2022 Assets PLN 78.6 billion PLN 83.0 billion PLN 84.6 billion PLN 89 billion Business Number of Individual 4.2 million 4.1 million 4,1 million 4.5 million volumes Customers Number of Business 239K 258K 259K 278K C
Slide 22: Credit risk
Credit risk 22
Slide 23: Decreasing risk costs and improved loan portfolio quality
Decreasing level of the Bank’s risk costs and a noticeable improvement in the quality of the loan portfolio Impaired loans (PLN billion) NPL reserve coverage ratio* Cost of Risk - CoR** 5,00% 13,81% 9 4,00% 1,71% 12,96% 12,75% 9 1,59% 1,58% 3,00% 1,54% 11,77% 8 2,00% 11,31% 8 56,25% 1,33% 1,00% 55,8
Slide 24: Change in lending policy has reduced the cost of risk
The change in lending policy has enabled a reduction in the cost of risk Alior Bank Group – Cost of Risk As a result of actions taken in 2020 and 2021 to manage the risk of the 5,94% loan portfolio and due to the current customer behaviour, the level of Cost of Risk (CoR) in 1Q 22 was well below the
Slide 25: Capital and liquidity surplus significantly above regulatory minimum
Stable and secure position of the Bank: capital and liquidity surplus significantly above the regulatory minimum The levels of TIER I and TCR capital adequacy ratios as at the end of 1Q 22 significantly exceed the regulatory minimum by: 309 bps (PLN 1.5 billion) and 259 bps (PLN 1.3 billion), respec
Slide 26: Why Alior Bank?
Why Alior Bank? ▪ Innovation, digitisation, high quality of services for Customers ▪ Improvement of performance by increasing revenue and reducing costs ▪ Improvement in the loan portfolio quality ▪ Growing share of housing loans in the portfolio ▪ Negligible share of CHF housing loans in the portfo
Slide 27: Other issues
Other issues 27
Slide 28: A strong start to the year in the shadow of the war in Ukraine
A strong start to the year in the shadow of the war in Ukraine End of 2021 supported by inventories NBP continues monetary tightening… GDP growth (viable, %, y/y) and its structure (p.p.) Interest rates (%) 10,0 Poland, Hungary, Czech Republic 14,0 5,0 12,0 10,0 0,0 8,0 - 5,0 6,0 4,0 - 10,0 2,0 1Q'1
Slide 29: Domestic growth at the forefront of Europe – risk of accelerating inflation
Domestic economic growth at the forefront of Europe – risk of accelerating inflation Poland has returned to pre-crisis trends Post-crisis recovery intensifies inflationary pressures.. 110 GDP level (4Q 19 = 100) 12 CPI Inflation 10 (%, y/y) 105 8 100 6 95 4 90 2 0 85 -2 80 mar Mar2020 wrz20 Sep 20 m
Slide 30: Inflation and higher interest rates will slow down the economy
Inflation and higher interest rates will slow down the economy Consumption is the engine of economic rebound Inflation will slow down in 2024 GDP y/y growth along with its main components CPI y/y and the NBP base rate 10,0 12,0 10,5 8,0 10,0 8,6 5,7 6,0 8,0 6,50 3,9 3,4 4,0 2,7 6,0 5,1 2,0 4,0 3,4 2
Slide 31: Successfully addressing climate-related challenges
We have been successfully addressing climate-related challenges We cooperate with: PLN 726.8 18.7 k. PLN 1.2 bn new Customers balance m as at the end as at the end of volume of new eco- 1Q 22 1Q 22 sales at the end of 1Q 22 ECO OFFER in 1Q 22 #EKO category Eco-benefits to a credit Eco Loan Clean Air
Slide 32: Key awards and promoted products in 1Q 2022
Key awards and promoted Bank’s products in 1Q 2022 Alior Bank again won the competition called “Institution of the Year”. During the seventh edition, the jury awarded the bank in as many as six categories: Alior Bank is the winner of Celent Model • “Best service in remote channels”, Bank Awards 2022
Slide 33: Alior Bank's investment services
Alior Bank’s investment services Alior Bank’s Brokerage House Alior TFI In 1Q 22, among other alia as a result of the war in In 4Q 21 and 1Q 22, as a consequence of rising interest rates, Ukraine, we observed increased turnover on the WSE the market saw significant outflows from debt funds. This was
Slide 34: Activities pursued by Alior Leasing
Activities pursued by Alior Leasing Sale of lease and loans (PLN billion) Number of customers (in thousand) Lease portfolio and loans (PLN billion) +9% +32% -1% 3,0 3,0 68,3 74,3 73,9 6,0 6,0 2,7 5,4 55,4 5,0 2,3 3,9 35,1 0,5 2018 2019 2020 2021 I1Q 22 kw.22 2018 2019 2020 2021 I1Q 22 kw.22 2018 201
Slide 35: Gross structure of the loan portfolio
Gross structure of the loan portfolio – noticable increase in the share of housing loans Loan portfolio in total (PLN million) Retail Customer Segment (PLN million) Business Customer Segment* (PLN million) +2% +5% -2% 0% 0% -1% 63 357 38 593 38 571 62 055 63 579 36 702 25 353 24 986 24 786 3 903 4 3
Slide 36: Bank adjusts its deposit portfolio to market situation
Bank adjusts its deposit portfolio to the current market situation (PLN million) Structure of net liabilities to Customers (PLN billion) Net liabilities structure - Retail Segment Net liabilities structure - Business Segment +3% +5% -1% -2% +1% 72 006 -7% 68 622 70 780 1 059 2 419 2 004 22 985 5 416
Slide 37: Factors affecting changes in Net Interest Income 1Q 22 vs 4Q 21
Factors affecting changes in the Net Interest Income in 1Q 22 vs. 4Q 21 (PLN million) 37
Slide 38: Factors affecting changes in net profit 1Q 22 vs 1Q 21
Factors affecting changes in net profit in 1Q 22 vs 1Q 21 (PLN million) *Dividend revenue, income on instruments measured at fair value through profit or loss and net gain/(loss) and foreign exchange income, income on de-recognition of financial instruments not measured at fair value through the 38
Slide 39: New sale of loans
New sale of loans (PLN million) Sales in the Business Customer Segment* +14% -5% 2 729 2 432 865 2 196 2 082 1 823 691 1 818 628 1 619 754 1 363 603 1 455 666 541 436 562 1 864 1 741 1 568 1 152 1 220 1 328 927 1 078 893 1Q 20 2Q 20 3Q 20 4Q 20 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22 Non-renewable Renewable S
Slide 40: Consolidated statement of financial standing
Consolidated statement of the financial standing of the Alior Bank Group (PLN million) 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22 % q/q q/q % y/y y/y Total assets 79 880,6 79 035,1 78 201,9 83 048,4 84 649,7 1,9% 1 601,4 6,0% 4 769,1 Cash and cash equivalents 2 163,6 1 566,4 1 645,3 3 763,4 4 989,9 32,6% 1 226,5
Slide 41: Additional information
Additional information Employment (FTEs) Alior Bank’s branches -317 -4% -84 -4 -12% 0% -7 7 754 710 7 541 694 -1% 7 432 7 441 7 437 665 633 479 626 481 483 479 200 195 235 476 194 222 193 192 211 210 210 51 51 51 34 41 7 040 6 838 6 745 6 749 6 749 459 448 420 406 393 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22 1
Slide 42: Quotations, shareholding structure, ratings
Alior Bank S.A. - quotations, shareholding structure, ratings Alior Bank’s share price compared to WSE indices (comparable data for 12 months) Alior Bank share price : 45.85 PLN (data as at March 31, 2022) Capitalisation : 6.0 mld PLN 60 Value of shares in free trade : 3.1 mld PLN P/BV**: 1.1x 50 P/
Slide 43: Contact
Contact Contact data Investor Relations Department Address details e-mail: ir@alior.pl Alior Bank S.A. Investor Relations Department ul. Łopuszańska 38D 02-232 Warsaw Poland More information Website Following events: Facebook fanpage • 1H 2022 results – August 3, 2022 • 3Q 2022 results – November 4,
Slide 44: Disclaimer
Zastrzeżenie This data has been prepared by Alior Bank S.A. (“Bank”, “Company”) solely for the Presentation purposes. Any and all data that may constitute a projection for the Company’s future economic and financial results, contained in this presentation, has been prepared based on the Report of th