Unicredit S.p.a. · MIL:UCG
Unicredit — Debt Investor Presentation (February 2016)
33 slides from Unicredit's debt investor presentation, February 2016
Slide 1: UniCredit Group: 4Q15 & FY15 results
UniCredit Group: 4Q15 & FY15 results Presentation to Fixed Income Investors Milan, February 2016
Slide 2: Disclaimer
Disclaimer This Presentation may contain written and oral “forward-looking statements”, which includes all statements that do not relate solely to historical or current facts and which are therefore inherently uncertain. All forward-looking statements rely on a number of assumptions, expectations, p
Slide 3: UniCredit at a glance
UniCredit at a glance A clear international profile based on a strong European identity UniCredit Highlights Shareholders’ Structure(1) Strong local roots in 17 countries Institutional Investors Over 125,000(2) employees 33% 41% Stable Shareholders About 6,900(2) branches Retail More than 32
Slide 4: Group net profit 1.7bn in 2015
Group net profit 1.7bn in 2015 Dividend of 12 cents for 2015 proposed via optional scrip (pay-out of 42%) Strategic Implementation of Strategic Plan on track with agreement on restructuring of CBK Austria and sale of Plan Ukrsotsbank Delivery of digital sale & service solutions already started,
Slide 5: Execution delivering tangible results in first three months of implementation
Execution delivering tangible results in first three months of implementation Strategic Plan Delivering on Strategic Plan in 4Q15 LEADING PAN-EUROPEAN Strong franchise with 1 million new customers in 2015, reaching 32m clients CORPORATE AND RETAIL Increasing market shares in core geographies I
Slide 6: Agenda
Agenda Group Core Bank Non Core Financials 6 UniCredit Group - INTERNAL USE ONLY -
Slide 7: Group – Results
Group – Results Net profit at 1.7bn in 2015, notwithstanding negative one-offs. Adjusted net profit at 2.2bn Net profit, m Net profit FY15 adjusted for non rec. items (net of tax), m Net profit 9M15 1,694 2.2bn ex. non stated FY15 4Q15 rec. items 2,008 Restructuring +214 1,694 charges 198 Ukrsotsban
Slide 8: Group – Balance sheet
Group – Balance sheet Sound balance sheet and liquidity position thanks to a strong commercial franchise Commercial loans, bn Commercial deposits, bn +0.2% +9.0% -0.2% +2.3% 432.3 433.8 433.1 354.6 378.0 386.6 Dec-14 Sep-15 Dec-15 Dec-14 Sep-15 Dec-15 Total RWA / Total assets, % -3.1pp -0.5pp 48.5 4
Slide 9: Group – Regulatory capital (1/2)
Group – Regulatory capital (1/2) Resilient fully loaded CET 1 ratio at 10.94% at Dec-15 including scrip dividend with a positive capital generation of 92bp y/y Fully loaded Common Equity Tier 1 ratio(1) +92bp +29bp -4bp 10.94% +14bp +8bp -5bp 10.53% +4bp -5bp 10.02% Dec-14 Sep-15 4Q15 earnings 4Q15
Slide 10: Group – Regulatory capital (2/2)
Group – Regulatory capital (2/2) Continued RWA reduction in 4Q15, resulting in a decrease of 19bn in 2015, also thanks to management focus on capital light businesses RWA main drivers(1), bn Operational Credit q/q, bn Market -18.6bn 409.2 -9.9bn 400.5 -2.5 -3.9 +1.4 -4.6 44.2 -0.3 43.2 -2.5 -2.1 390
Slide 11: Leverage Ratio
Leverage Ratio A sound level is confirmed, comparing well with peers Fully Loaded BIS3 Leverage Ratio(1), % Dec. 15 Sep. 15 6.4 6.0 6.1 5.7 5.0 4.6 4.7 4.5 4.4 4.5 4.0 4.0 4.1 3.9 3.5 3.3 Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Peer 8 UCG Peer 9 Peer 10 Peer 11 Peer 12 Peer 13 Peer 14 Peer
Slide 12: Group – Medium-long term funding plan
Group – Medium-long term funding plan 2016 Group Funding Plan for 28bn Funding mix, managerial data % of M/L term run offs by region(2) 27.6bn 32.7bn 8.2bn TLTRO Geographical distribution 29.5bn not included(1) 28.2bn 19.5bn Germany 11% 29.6% 58% 17% Italy 52% 69% 8% 22% Italy 44.7% Germany 28% 23%
Slide 13: Group Direct Funding and Retail Bonds Dynamics
Group Direct Funding and Retail Bonds Dynamics 4Q15 Direct Funding(1) 4Q15 Retail Bonds €/bn €/bn 584.3 449.8 134.5 30.8 37.7 Incl. 37.7bn of unsecured retail bonds 6.9 Direct Funding Deposits Securities Retail sub. Retail senior Total unsecured bonds bonds retail bonds 77.0% 23.0% 1.2% 5.3% 6.5% %
Slide 14: UniCredit has a diversified and continuous access to the wholesale market
UniCredit has a diversified and continuous access to the wholesale market Feb 15 Mar 15 Apr 15 May 15 Jun 15 Jul 15 Aug 15 Sep 15 Oct 15 Nov 15 Dic 15 Jan 16 18/02/2015 7Y MS + 3 bps 01/09/2015 MS + 5 bps Pfand 10Y 31/03/2015 23/04/2015 17/07/2015 (500) 08122015 Pfand MS -14 bps MS + 45 bps MS – 13
Slide 15: Very strong liquidity position confirmed
Very strong liquidity position confirmed 1-year Group liquidity buffer exceeds 12m wholesale funding Liquidity buffer (12 months) as of Dec-15 (€bn) 184 Additional eligible assets 29 available within 12 months(1) Cash and Deposits 31 with Central Banks Unencumbered assets 156 124 (immediately availa
Slide 16: TLAC Calibration and UniCredit Plan
TLAC Calibration and UniCredit Plan TLAC Requirements Earliest by 2019 TLAC planned issuance under MYP (2016-2018) 22.3% TLAC ratio 22.53% G-SIFI 1% Capital 2019 old Senior outstanding 7.7bn 1.81% conservation 2.5% Pillar 2 2.75% Senior bond 20 bn 4.70% Funding plan (2016-2018) 16%(1) Capital ratio
Slide 17: Ratings Overview
Ratings Overview Issuer Ratings(1) Recent actions and key individual rating drivers Italy BBB-/Stable/A3 On the 18th December 2014, UC SpA's rating was aligned with the sovereign Italy (affirmed on the 13th of November), as S&P's criteria caps the rating at the same level UC SpA BBB-/Stable/A3 O
Slide 18: Group – Asset quality
Group – Asset quality Sound improvement of AQ in 2015 as a result of mgmt focus on de-risking, with gross impaired further down, bad loans stabilizing and improving net inflows Gross impaired loans(1), bn Gross bad loans (sofferenze)(1), bn -5.5% -2.0% -1.2% +0.9% 84.4 80.7 79.8 52.1 50.6 51.1 Net N
Slide 19: Asset quality in Italy
Asset quality in Italy Confirmed better asset quality trend vs. banking system Improving net inflows and coverage ratio on bad loans well above peers Other gross impaired loans Gross bad loans (sofferenze) Base 100 at Dec-12 Base 100 at Dec-12 UCI Spa(1) 137 138 141 138 UCI Spa(1) 164 165 137 160 AB
Slide 20: Agenda
Agenda Group Core Bank Non Core Financials 20 UniCredit Group - INTERNAL USE ONLY -
Slide 21: Core Bank – P&L
Core Bank – P&L Bottom line over 3.2bn, 3.7bn adjusted for negative one-offs leading to a return on allocated capital above 10% -2.7pp +0.4pp Ch. % Ch. % 61.1 58.4 58.2 58.7 data in m 3Q15 4Q15 Q/Q FY14 FY15 Y/Y Cost / Income, % Revenues 5,308 5,622 +5.9% 22,177 22,304 +0.6% Net interest 2,925 3,061
Slide 22: Core Bank – Net interest income
Core Bank – Net interest income Net interest higher in 4Q15 with improvement in cost of funding and loans volumes more than offsetting lower customer rates on loans Net interest bridge q/q , m +5.1% 3,061 Euribor 3M +65 -0.09% +44 2,925 2,912 -10 -14 +44 -38 +46 in 4Q15 Commercial dynamics: +85m (-6
Slide 23: Core Bank – Fees and commissions
Core Bank – Fees and commissions Fees up by c.5% in FY15 thanks to investment fees: flight to quality supported higher TFA, while switch from AuC underpinned new inflows to AuM Net fees and commissions, m Investment services fees, m recurring fees (c.60% during 2015)(1) +12.1% +4.7% +3.3% 7,730 3,26
Slide 24: Core Bank – Total costs
Core Bank – Total costs Costs dynamics in 4Q15 mainly driven by CEE and due to higher depreciation and seasonality of administrative expenses Costs, m Staff expenses, m +2.0% -0.1% 8,053 8,215 +1.3% 2,047 2,034 2,032 12,916 13,082 4Q14 3Q15 4Q15 FY14 FY15 Other administrative expenses(1), m +1.3% -0
Slide 25: Core Bank – Loan loss provisions
Core Bank – Loan loss provisions LLP at 2.5bn in 2015, resulting in a contained cost of risk at 56bp thanks to sound portfolio quality in CIB, CBK Germany & Austria and Poland Loan loss provisions, m Divisional breakdown – 4Q15 cost of risk, bp q/q y/y 2015 embedding increase of coverage on performi
Slide 26: Agenda
Agenda Group Core Bank Non Core Financials 26 UniCredit Group - INTERNAL USE ONLY -
Slide 27: Non Core – Main trends
Non Core – Main trends Focus on continued de-risking delivered gross loans reduction, with lower and more stable LLP and net loss reduction y/y Gross customer loans, bn Main drivers of run-down, y/y -14.5bn c.4bn successfully sold in 2015 confirming a Disposals sound market appetite 78.2 -2.0bn 65
Slide 28: Non Core – Asset quality
Non Core – Asset quality Impaired loans down with lower other impaired and higher outflows from impaired. Bad loans stabilizing with disposals balancing internal migrations Gross impaired loans(1), bn Gross bad loans (sofferenze)(1), bn -8.2% -0.6% 56.9 52.7 52.2 37.6 36.6 37.4 Net Net 26.8 25.5 25.
Slide 29: Concluding remarks
Concluding remarks Strong capital generation with 10.94% fully loaded CET 1 ratio, above SREP threshold and fully loaded G-SIB buffer Strategic Plan execution on track, delivering tangible results Strong franchise and diversified geographical footprint delivering resilient revenues in a diffic
Slide 30: Agenda
Agenda Group Core Bank Non Core Financials 30 UniCredit Group - INTERNAL USE ONLY -
Slide 31: Group – P&L and volumes
Group – P&L and volumes Net profit at 1.7bn in FY15 with resilient operating performance mitigating market volatility and charges related to ongoing restructuring Euro (m) 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 ∆ % vs. ∆ % vs. FY14 FY15 ∆ % vs. 3Q15 4Q14 FY14 Total Revenues 5,588 5,798 5,561 5,604
Slide 32: Core Bank – P&L and volumes
Core Bank – P&L and volumes Resilient revenues in FY15 thanks to fees mitigating the impact of low rates on net interest Euro (m) 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 ∆ % vs. ∆ % vs. FY14 FY15 ∆ % vs. 3Q15 4Q14 FY14 Total Revenues 5,481 5,687 5,477 5,532 5,685 5,690 5,308 5,622 +5.9% ▲ +1.6% ▲ 22
Slide 33: Non Core – P&L and volumes
Non Core – P&L and volumes Net loss at 1.5bn in FY15, down by over 10% thanks to lower loan loss provisions offsetting lower revenues Euro (m) 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 ∆ % vs. ∆ % vs. FY14 FY15 ∆ % vs. 3Q15 4Q14 FY14 Total Revenues 107 112 85 72 64 45 24 -33 n.m. ▼ n.m. ▼ 375 101 -73.
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