Erste Group Bank Ag · VIE:EBS
Erste Group Bank — H1 2013 Earnings Presentation
90 slides from Erste Group Bank's earnings presentation, Jul 30, 2013
Slide 1: Erste Group investor presentation – H1 2013 results
Erste Group investor presentation – H1 2013 results 30 July 2013 Solid retail & SME business, sound funding and capital Andreas Treichl, CEO, Erste Group Manfred Wimmer, CFO, Erste Group Gernot Mittendorfer, CRO, Erste Group
Slide 2: Disclaimer – Cautionary note regarding forward-looking statements
Disclaimer – Cautionary note regarding forward-looking statements − THE INFORMATION CONTAINED IN THIS DOCUMENT HAS NOT BEEN INDEPENDENTLY VERIFIED AND NO REPRESENTATION OR WARRANTY EXPRESSED OR IMPLIED IS MADE AS TO, AND NO RELIANCE SHOULD BE PLACED ON, THE FAIRNESS, ACCURACY, COMPLETENESS OR CORREC
Slide 3: Executive summary – Solid retail & SME business, sound funding and capital
Executive summary – Solid retail & SME business, sound funding and capital • Net profit of EUR 301.2m supported by significant reduction in risk costs • Decline in net profit due to significant one-off income in H1 12 (hybrid buyback) Income statement – • Operating result impacted by subdued loan de
Slide 4: Presentation topics
Presentation topics − Business performance − BCR update − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure HY 2013 results 30 July 2013 presentation 4
Slide 5: Operating environment: macro trends – Signs of economic recovery visible in CEE
Operating environment: macro trends – Signs of economic recovery visible in CEE − Growth mainly driven by exports, however, domestic Real GDP growth in Erste Group‘s core markets (in %) demand has also started to gradually improve 4.4 2010 2012 − Several countries following through with austerity 3.
Slide 6: Operating environment: macro trends – What has recently happened in CEE?
Operating environment: macro trends – What has recently happened in CEE? − AT: fundamental economic position has remained excellent − Austria continuously outgrows the euro zone − Unemployment rate (4.7% as of May 2013) is the lowest in the entire European Union − Public debt and budget deficit are
Slide 7: Key financial indicators – EPS and ROE reflecting market environment
Key financial indicators – EPS and ROE reflecting market environment YTD cost income ratio YTD net interest margin 52.5% 52.8% 51.7% 51.9% 49.4% 3.06% 2.99% 2.92% 2.83% 2.67% 1-6 09 1-6 10 1-6 11 1-6 12 1-6 13 1-6 09 1-6 10 1-6 11 1-6 12 1-6 13 Cash earnings per share** Cash return on equity** 1.51
Slide 8: Income statement (IFRS): H1 13 vs H1 12
Income statement (IFRS): H1 13 vs H1 12 – Net profit driven by risk costs, NII and banking tax in EUR million 1-6 13 1-6 12 Change Comment Net interest income 2,431.2 2,651.7 (8.3%) Low interest rates, subdued loan demand Risk provisions for loans (831.8) (981.8) (15.3%) Significant reduction in ret
Slide 9: Income statement (IFRS) Q2 13 vs Q1 13
Income statement (IFRS) Q2 13 vs Q1 13 – Lower NII and higher banking tax weighing on net profit in EUR million Q2 13 Q1 13 Change Comment Net interest income 1,190.6 1,240.6 (4.0%) Low interest rates, subdued loan demand Risk provisions for loans (429.6) (402.2) 6.8% Risk costs down in RO, up in la
Slide 10: Balance sheet (IFRS) – Lower customer loans, lower RWAs
Balance sheet (IFRS) – Lower customer loans, lower RWAs in EUR million Jun 13 Dec 12 Change Comment Cash and balances with central banks 9,626 9,740 (1.2%) Loans and advances to credit institutions 10,163 9,074 12.0% Higher interbank activity Loans and advances to customers 129,756 131,928 (1.6%) Re
Slide 11: Balance sheet (IFRS) – Strong deposit base and capital position
Balance sheet (IFRS) – Strong deposit base and capital position in EUR million Jun 13 Dec 12 Change Comment Deposits by banks 21,699 21,822 (0.6%) Customer deposits 122,513 123,053 (0.4%) Exclusion of Czech pension fund: EUR 1.7bn Debt securities in issue 28,826 29,427 (2.0%) Value adjustments from
Slide 12: Segment highlights – Improvement in RO, solid results in EBOe, CZ and SK
Segment highlights – Improvement in RO, solid results in EBOe, CZ and SK Top segment performers in H1 13: Romania EB Oesterreich Czech Republic Slovakia in EUR million 1-6 13 1-6 12 ∆ 1-6 13 1-6 12 ∆ 1-6 13 1-6 12 ∆ 1-6 13 1-6 12 ∆ Operating income 391 383 2% 478 472 1% 729 792 (8%) 266 268 (1%) Ope
Slide 13: Presentation topics
Presentation topics − Business performance − BCR update − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure HY 2013 results 30 July 2013 presentation 13
Slide 14: BCR turnaround – Romania achieves pre-tax profit in Q2 13
BCR turnaround – Romania achieves pre-tax profit in Q2 13 Key priorities The road to profitability in 2013 Key priority #1: • Absolute NPL volume expected to peak and modestly decline in 2013 • 6th consecutive quarter of improving NPL provisioning coverage, now at 60.4% Improve asset • Risk provisio
Slide 15: Presentation topics
Presentation topics − Business performance − BCR update − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure HY 2013 results 30 July 2013 presentation 15
Slide 16: Loan book review – Limited demand reflected in loan book
Loan book review – Limited demand reflected in loan book − Customer loans decreased by 1.6% ytd; Customer loans by main segments reductions in most business segments − Austria: overall stable, qoq increase in retail and 150 133.9 133.5 131.9 130.3 129.8 SMEs/local corporates but decline in municipal
Slide 17: Asset quality review – NPL ratio increases as loan book declines
Asset quality review – NPL ratio increases as loan book declines − Overall NPL ratio increase by 0.5pp ytd Erste Group: NPL ratio vs NPL coverage − Increase stems mainly from GCIB and declining loan volumes 30% 63.1% 65% 62.6% 62.4% − Increase in BCR partially due to reduced NPL sales 25% 61.2% 61.7
Slide 18: Asset quality review – AT, CZ & SK improve, while RO stabilises
Asset quality review – AT, CZ & SK improve, while RO stabilises − Retail & SME/Austria: asset quality stable NPL ratios in key segments − NPL ratio stable at 5.6% − NPL coverage ratio stable yoy, but slightly decreased 35% qoq to 61.4% 30.8% 30% 27.3% − Hungary: fourth consecutive quarter of NPL 25%
Slide 19: Asset quality review – Risk costs further decreased in retail & SME business
Asset quality review – Risk costs further decreased in retail & SME business − Slovakia: further good quality loan growth − NPL ratio further declined to 5.5% Risk costs in key segments − Loan growth mainly with retail clients 8% − Czech Republic: NPL ratio reduction from 6% already low base 3.64% −
Slide 20: Presentation topics
Presentation topics − Business performance − BCR update − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure HY 2013 results 30 July 2013 presentation 20
Slide 21: Funding update – Continued strong deposit performance
Funding update – Continued strong deposit performance − Stable retail & SME customer deposit base Customer deposit trends by main segments − Overall, retail & SME deposits remain flat − GCIB deposits increased by 10.3% ytd 125 122.3 122.2 123.3 123.1 122.5 − Nominal decline in the Czech Republic mai
Slide 22: Funding update – Excess liquidity position, limited funding requirements
Funding update – Excess liquidity position, limited funding requirements − Short-term funding needs very well covered Evolution of funding mix − Investment in highly liquid assets led to rising collateral 100% 3.2% 3.0% 3.0% 2.7% 2.7% 90% 8.5% 9.0% 8.2% 8.3% 8.3% coverage of short-term funding needs
Slide 23: Presentation topics
Presentation topics − Business performance − BCR update − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure HY 2013 results 30 July 2013 presentation 23
Slide 24: Capital position – Improved core tier 1 ratio on lower RWAs
Capital position – Improved core tier 1 ratio on lower RWAs Capital position (June 2013) Recent developments Capital development Core tier 1 ratio − Switch to IFRS in calculation of (total risk) qualifying capital as of Mar 13; 11.8% 11.2% CT1 (Basel 2.5) ratio 11.8% no material impact due to improv
Slide 25: Capital position after capital increase – Fully loaded Basel 3 CET1 ratio of 10%
Capital position after capital increase – Fully loaded Basel 3 CET1 ratio of 10% already achieved − Erste Group expects to comfortably meet its targeted 10% fully loaded Basel 3 common equity tier-1 ratio from the end of 2014 onwards − Planned full repayment of government and private participation c
Slide 26: Presentation topics
Presentation topics − Business performance − BCR update − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure HY 2013 results 30 July 2013 presentation 26
Slide 27: Conclusion – Outlook
Conclusion – Outlook − Erste Group expects a slight improvement in economic performance for Central and Eastern Europe in H2 2013, even though growth will remain moderate − For 2013 Erste Group expects operating result to decline up to 5% compared to 2012 − Lower operating income as a result of mode
Slide 28: Presentation topics
Presentation topics − Business performance − BCR update − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure HY 2013 results 30 July 2013 presentation 28
Slide 29: Segment review – Improved profitability in the retail & SME segment
Segment review – Improved profitability in the retail & SME segment Retail & SME GCIB Group Markets Corporate Center Total Group in EUR million 1-6 13 1-6 12 1-6 13 1-6 12 1-6 13 1-6 12 1-6 13 1-6 12 1-6 13 1-6 12 Net interest income 2,026.1 2,192.1 202.2 257.2 95.8 107.3 107.2 95.1 2,431.2 2,651.7
Slide 30: Region – Austria
Region – Austria EBOe’s and savings banks’ net profit up yoy Savings banks EB Oesterreich Austria in EUR million 1-6 13 1-6 12 1-6 13 1-6 12 1-6 13 1-6 12 Net interest income 439.5 476.7 298.0 312.2 737.5 788.9 Risk provisions for loans and advances (70.2) (110.8) (37.6) (54.3) (107.8) (165.1) Net f
Slide 31: Region – Central and Eastern Europe (1)
Region – Central and Eastern Europe (1) Romania shows most significant yoy improvement Czech Republic Romania Slovakia Hungary in EUR million 1-6 13 1-6 12 1-6 13 1-6 12 1-6 13 1-6 12 1-6 13 1-6 12 Net interest income 499.3 570.6 296.5 284.3 211.7 211.0 136.6 175.9 Risk provisions for loans and adva
Slide 32: Region – Central and Eastern Europe (2)
Region – Central and Eastern Europe (2) Declining risk costs drive CEE performance Croatia Serbia Ukraine CEE in EUR million 1-6 13 1-6 12 1-6 13 1-6 12 1-6 13 1-6 12 1-6 13 1-6 12 Net interest income 118.9 128.9 19.4 18.1 6.2 14.4 1,288.5 1,403.2 Risk provisions for loans and advances (77.4) (71.0)
Slide 33: Segment Retail & SME – Net profit up on lower risk costs
Segment Retail & SME – Net profit up on lower risk costs − Operating result down as reduced operating expenses in EUR million 1-6 13 1-6 12 Change did not fully offset decrease in operating income Net interest income 2,026.1 2,192.1 (7.6%) − Operating income decreased by 3.9% yoy − Growing share of
Slide 34: Segment Retail & SME – Loan book analysis
Segment Retail & SME – Loan book analysis Segment Retail & SME - Segment Retail & SME - Customer loans by Basel II customer segment Customer loans by currency 120 114.2 114.4 113.6 112.2 112.0 100% 2.2% 2.1% 1.7% 1.3% 1.2% 6.4 6.3 6.6 6.4 6.2 12.5% 11.5% 11.0% 10.6% 10.0% 80% 21.4% 21.2% 21.2% 90 21
Slide 35: Segment GCIB excl IB – Net loss on higher risk costs and lower NII
Segment GCIB excl IB – Net loss on higher risk costs and lower NII − Operating result declined on lower NII − NII declined mainly due to reduction of commercial real estate in EUR million 1-6 13 1-6 12 Change loans and decrease in the large corporate business in Austria Net interest income 175.0 215
Slide 36: International Business (GCIB) – Net profit due to improvements in other result
International Business (GCIB) – Net profit due to improvements in other result − Reduction of business impacts International Business unit result in EUR million 1-6 13 1-6 12 Change − NII declined as a result of higher asset sales in 2012 Net interest income 27.2 42.1 (35.4%) − Trading result impact
Slide 37: Segment GCIB (incl IB) – Loan book analysis
Segment GCIB (incl IB) – Loan book analysis Segment GCIB - Segment GCIB - Customer loans by currency Customer loans by Basel II customer segment 25 5.3% 5.3% 100% 5.4% 5.4% 5.1% 1.5% 1.5% 1.5% 1.3% 1.5% 20 19.2 18.8 6.0% 7.3% 6.9% 6.6% 6.7% 1.2 17.9 17.7 17.2 80% 8.2% 7.4% 7.0% 7.0% 7.5% 1.2 in EUR
Slide 38: Segment Group Markets – Net profit down on lower trading result and NII
Segment Group Markets – Net profit down on lower trading result and NII − Operating result declined substantially on lower net trading result and also lower NII in EUR million 1-6 13 1-6 12 Change − NII decreased mainly due to money market and government Net interest income 95.8 107.3 (10.8%) bond b
Slide 39: Segment Corporate Center – H1 results impacted by one-offs
Segment Corporate Center – H1 12 results impacted by one-offs − What is in the Corporate Center? − This segment includes the intragroup consolidation between in EUR million 1-6 13 1-6 12 Change segments and sub-segments, the results of those sub-segments Net interest income 107.2 95.1 12.7% that can
Slide 40: Retail & SME: Austria/EB Oesterreich – Stable net profit supported by lower risk costs
Retail & SME: Austria/EB Oesterreich – Stable net profit supported by lower risk costs − Operating result improved year-on-year by 6.0% − NII decreased as a result of the low interest rate environment in EUR million 1-6 13 1-6 12 Change − Fee income increased yoy on improved securities business Net
Slide 41: Retail & SME: Austria/EB Oesterreich – Loan book analysis
Retail & SME: Austria/EB Oesterreich – Loan book analysis Subsegment EB Oesterreich - Subsegment EB Oesterreich - Customer loans by Basel II customer segment Customer loans by currency 30 28.2 28.2 28.1 27.8 27.9 100% 1.9% 1.9% 1.6% 1.5% 1.3% 1.8 1.8 1.8 1.8 1.5 11.8% 11.3% 10.4% 13.6% 12.5% in EUR
Slide 42: Retail & SME: Austria/Savings banks – Increased net profit on lower risk costs
Retail & SME: Austria/Savings banks – Increased net profit on lower risk costs − Operating result decreased year-on-year due to weaker net interest income in EUR million 1-6 13 1-6 12 Change − NII decreased as a result of the low interest rate environment Net interest income 439.5 476.7 (7.8%) − Net
Slide 43: Retail & SME: Austria/Savings banks – Loan book analysis
Retail & SME: Austria/Savings banks – Loan book analysis Subsegment Savings Banks - Subsegment Savings banks - Customer loans by Basel II customer segment Customer loans by currency 40 37.6 37.7 37.7 37.3 37.4 100% 3.6% 3.5% 3.3% 2.3% 2.2% 1.6 1.6 1.7 1.6 1.6 13.1% 17.1% 15.5% 14.5% 13.8% 30 80% in
Slide 44: Retail & SME: Czech Republic – Net profit up, risk costs down
Retail & SME: Czech Republic – Net profit up, risk costs down − Operating result declined yoy − NII down due to low interest rate environment and subdued loan in EUR million 1-6 13 1-6 12 Change demand and on changed presentation for the pension fund (NII Net interest income 499.3 570.6 (12.5%) impa
Slide 45: Retail & SME: Czech Republic – Loan book analysis
Retail & SME: Czech Republic – Loan book analysis Subsegment Czech Republic - Subsegment Czech Republic - Customer loans by Basel II customer segment Customer loans by currency 20 17.8 17.9 0.2% 0.2% 0.2% 0.2% 0.1% 17.3 17.5 17.6 100% 0.6 0.7 3.8% 3.4% 3.5% 3.9% 4.1% 0.6 0.7 0.7 16 5.7 5.7 5.5 5.5 8
Slide 46: Retail & SME: Romania – Restructuring well under way, strong decline in risk costs
Retail & SME: Romania – Restructuring well under way, strong decline in risk costs − Operating result improved on lower operating expenses in EUR million 1-6 13 1-6 12 Change − NII increased yoy but declined qoq Net interest income 296.5 284.3 4.3% − Stable underlying fee performance Net fee income
Slide 47: Retail & SME: Romania – Loan book analysis
Retail & SME: Romania – Loan book analysis Subsegment Romania - Subsegment Romania - Customer loans by Basel II customer segment Customer loans by currency 12 11.0 10.8 100% 1.7% 1.4% 1.3% 1.4% 1.3% 10.7 10.5 10.3 1.0 1.0 1.2 1.2 1.2 80% 9 in EUR billion 4.5 61.3% 61.7% 61.2% 60.8% 60.8% 4.4 4.2 4.1
Slide 48: Retail & SME: Slovakia – Solid operating performance continues
Retail & SME: Slovakia – Solid operating performance continues − Operating result declined − NII stable yoy, improvement qoq driven by higher ALM in EUR million 1-6 13 1-6 12 Change contribution and retail business Net interest income 211.7 211.0 0.3% − Fee income decreased yoy due to the cancellati
Slide 49: Retail & SME: Slovakia – Loan book analysis
Retail & SME: Slovakia – Loan book analysis Subsegment Slovakia - Subsegment Slovakia - Customer loans by Basel II customer segment Customer loans by currency 8 6.4 6.6 6.7 6.8 100% 0.2% 0.1% 0.2% 0.1% 0.1% 6.3 0.2 0.2 0.2 0.2 0.2 6 1.3 1.3 1.3 80% in EUR billion 1.3 1.3 0.3 0.3 0.3 0.3 0.3 4 60% 99
Slide 50: Retail & SME: Hungary – Operating performance reflects deleveraging
Retail & SME: Hungary – Operating performance reflects deleveraging − Operating result down due to lower business volumes − NII declined on portfolio reduction, lower margins and subdued in EUR million 1-6 13 1-6 12 Change loan demand Net interest income 136.6 175.9 (22.4%) − Fee income increased in
Slide 51: Retail & SME: Hungary – Loan book analysis
Retail & SME: Hungary – Loan book analysis Subsegment Hungary - Subsegment Hungary - Customer loans by Basel II customer segment Customer loans by currency 10 100% 0.2% 0.1% 0.1% 0.0% 0.1% 8 21.2% 22.0% 21.2% 23.1% 22.5% 6.8 6.5 80% 6.2 in EUR billion 0.4 0.3 5.9 5.5 6 0.3 0.3 2.0 1.9 0.1 60% 1.7 1.
Slide 52: Retail & SME: Croatia – Increase in risk costs impacts net profit
Retail & SME: Croatia – Increase in risk costs impacts net profit − Operating result decreased yoy but up qoq − NII declined yoy mainly due to lower margins and higher NPL in EUR million 1-6 13 1-6 12 Change volumes Net interest income 118.9 128.9 (7.7%) − Fee income down on cancellation of reminder
Slide 53: Retail & SME: Croatia – Loan book analysis
Retail & SME: Croatia – Loan book analysis Subsegment Croatia - Subsegment Croatia - Customer loans by Basel II customer segment Customer loans by currency 6.0 5.9 5.9 5.9 6.0 100% 0.3% 0.2% 0.2% 0.3% 0.2% 6 12.6% 12.2% 11.9% 11.5% 10.8% 0.7 0.6 0.7 0.7 0.8 80% in EUR billion 4 2.5 2.5 2.4 2.4 2.4 6
Slide 54: Retail & SME: Serbia – Sound operating performance, risk costs up
Retail & SME: Serbia – Sound operating performance, risk costs up − Operating result improved on higher NII − NII up by 7.0% yoy on corporate loan growth and improved retail in EUR million 1-6 13 1-6 12 Change margins Net interest income 19.4 18.1 7.0% − Net trading result driven by FX development N
Slide 55: Retail & SME: Serbia – Loan book analysis
Retail & SME: Serbia – Loan book analysis Subsegment Serbia - Subsegment Serbia - Customer loans by Basel II customer segment Customer loans by currency 600 569.2 575.3 562.9 0.9% 0.8% 0.7% 0.7% 0.7% 539.2 3.4 2.8 2.7 100% 3.8% 3.3% 3.2% 3.0% 3.0% 481.0 4.3 3.6 80% in EUR million 400 334.7 360.1 346
Slide 56: Retail & SME: Ukraine – Deconsolidation as of April 2013
Retail & SME: Ukraine – Deconsolidation as of 29 April 2013 − Due to the deconsolidation following the sale of EB in EUR million 1-6 13 1-6 12 Change Ukraine, only the results of the first 3 months are Net interest income 6.2 14.4 (56.8%) included in 2013 Net fee income 1.2 2.6 (54.1%) Net trading r
Slide 57: Presentation topics
Presentation topics − Business performance − BCR update − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure HY 2013 results 30 July 2013 presentation 57
Slide 58: Asset quality analysis – Key definitions
Asset quality analysis – Key definitions − Key asset quality indicators are based Risk category Agency ratings on on-balance sheet customer loans Low risk AAA to BB / Aaa to Ba − Reported NPL and NPL coverage ratios Management attention B exclude collateral Substandard CCC to C / − Broad NPL definit
Slide 59: Asset quality analysis – Loan book overview
Asset quality analysis – Loan book overview Customer loans by Basel II customer segments Customer loans by industries 150 133.9 133.5 131.9 130.3 129.8 7.6 7.5 7.8 7.5 7.3 6.0% 120 3.0%3.7% 2.8% 4.7% 39.8% in EUR billion 62.3 61.8 60.4 59.7 59.4 5.3% 90 60 12.9 12.8 12.6 12.4 12.3 4.6% 30 6.8% 51.2
Slide 60: Asset quality analysis – Loan book by segments
Asset quality analysis – Loan book by segments Management Low risk attention Substandard Non-performing Total loan book Risk provisions NPL coverage NPL ratio Jun 13 Dec 12 Jun 13 Dec 12 Jun 13 Dec 12 Jun 13 Dec 12 Jun 13 Dec 12 Jun 13 Dec 12 Jun 13 Dec 12 Jun 13 Dec 12 Retail & SME 82,679 83,171 15
Slide 61: Asset quality analysis – Loan book by region (country of origination)
Asset quality analysis – Loan book by region (country of origination) Low risk Management Substandard Non-performing Total loan book attention in EUR million Jun 13 Dec 12 Jun 13 Dec 12 Jun 13 Dec 12 Jun 13 Dec 12 Jun 13 Dec 12 Share of total Share of total Core market 89,144 90,219 16,975 18,191 3,
Slide 62: Asset quality analysis – Total exposure by region (country of origination)
Asset quality analysis – Total exposure by region (country of origination) Low risk Management Substandard Non-performing Total Exposure attention in EUR million Jun 13 Dec 12 Jun 13 Dec 12 Jun 13 Dec 12 Jun 13 Dec 12 Jun 13 Dec 12 Share of total Share of total Core market 144,565 145,789 19,388 20,
Slide 63: Asset quality analysis – Financial assets
Asset quality analysis – Financial assets Financial assets by country of origination Financial assets by currency (30 June 2013: EUR 39.7 bn) (30 June 2013: EUR 39.7 bn) 3.7% 5.3% 2.4% 14.7% 1.3% 3.0% 1.0% 31.4% 8.3% 3.5% 4.7% 2.9% 18.2% 19.0% 14.0% 66.5% AT CZ SK US DE HU RO IT GB Other EUR CZK USD
Slide 64: Balance sheet (IFRS) drill-down – Trading assets as of June 2013
Balance sheet (IFRS) drill-down – Trading assets as of 30 June 2013 − Increase of EUR 2.6 bn ytd due to increased investments into sovereign bonds in EUR m Sovereign Banks Other Total Trading CZ 1,814 26.4% 0 0.0% 0 0.0% 1,814 23.4% SK 366 5.3% 0 0.0% 0 0.0% 366 4.7% RO 1,111 16.2% 3 0.9% 0 0.0% 1,1
Slide 65: Balance sheet (IFRS) drill-down – Financial assets at fair value
Balance sheet (IFRS) drill-down – Financial assets at fair value as of 30 June 2013 − Decline of EUR 74m ytd driven by reduction of sovereign bonds in EUR m Sovereign Banks Other Total FV CZ 130 76.9% 23 11.9% 62 22.0% 214 33.4% SK 26 15.5% 0 0.0% 11 4.0% 37 5.8% RO 5 2.8% 0 0.0% 4 1.3% 8 1.3% HU 0
Slide 66: Balance sheet (IFRS) drill-down – Financial assets available for sale
Balance sheet (IFRS) drill-down – Financial assets available for sale as of 30 June 2013 − Ytd decline of AfS portfolio of EUR 1.7 bn mainly due to changed presentation of Czech pension fund in EUR m Sovereign Banks Other Total AFS CZ 1,287 10.5% 103 2.5% 8 0.2% 1,398 6.8% SK 1,933 15.8% 30 0.7% 26
Slide 67: Balance sheet (IFRS) drill-down – Financial assets held-to-maturity
Balance sheet (IFRS) drill-down – Financial assets held-to-maturity as of 30 June 2013 − Financial assets HTM declined by EUR 403m ytd in EUR m Sovereign Banks Other Total HTM CZ 5,444 33.2% 193 13.1% 25 3.7% 5,662 30.5% SK 3,588 21.8% 0 0.0% 24 3.5% 3,612 19.4% RO 2,351 14.3% 3 0.2% 0 0.0% 2,354 12
Slide 68: Drill-down on selected asset classes – Peripheral Europe exposure at manageable level
Drill-down on selected asset classes – Peripheral Europe exposure at manageable level Total net exposure of Erste Group (incl. savings banks) to selected European countries: in EUR million Sovereign Bank Other Total net exposure Dec 11 Dec 12 Jun 13 Dec 11 Dec 12 Jun 13 Dec 11 Dec12 Jun 13 Dec 11 De
Slide 69: Off-balance sheet items – Exclusively related to customer business
Off-balance sheet items – Exclusively related to customer business in EUR million 2011 2012 June 2013 Guarantees and warranties 6,920 6,363 6,303 of which: in relation to corporate business 6,170 5,584 5,562 Undrawn lines, loan commitments, promissory notes 18,579 14,415 14,655 of which: in relation
Slide 70: Presentation topics
Presentation topics − Business performance − BCR update − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure HY 2013 results 30 July 2013 presentation 70
Slide 71: Key local entity data – Ceska sporitelna
Key local entity data (IFRS, consolidated) – Ceska sporitelna Key figures and ratios 1-6 13 1-6 12 Change Rate and margin environment Cost/income ratio 42.0% 41.8% Return on equity 17.1% 19.8% 80% 69.7% 70.1% 69.4% 70.6% 71.7% 8% Jun 13 Dec 12 Erste Group stake 99.0% 60% 6% Solvency ratio 17.4% 16.0
Slide 72: Key local entity data – Banca Comerciala Romana (BCR)
Key local entity data (IFRS, consolidated) – Banca Comerciala Romana (BCR) Key figures and ratios 1-6 13 1-6 12 Change Rate and margin environment Cost/income ratio 37.6% 40.1% Return on equity 16.1% na 150% 140.0% 140.8% 140.6% 138.2% 139.0% 15% Jun 13 Dec 12 Erste Group stake 93.3% 12% Solvency ra
Slide 73: Key local entity data – Slovenska sporitelna
Key local entity data (IFRS, consolidated) – Slovenska sporitelna Key figures and ratios 1-6 13 1-6 12 Change Rate and margin environment Cost/income ratio 42.2% 40.4% Return on equity 15.3% 18.8% 100% 8% 82.0% 84.3% 81.1% 84.6% Jun 13 Dec 12 79.5% Erste Group stake 100% 80% 6% Solvency ratio 22.0%
Slide 74: Key local entity data – Erste Bank Hungary
Key local entity data (IFRS, consolidated) – Erste Bank Hungary Key figures and ratios 1-6 13 1-6 12 Change Rate and margin environment Cost/income ratio 41.2% 36.1% Return on equity na na 180% 165.7% 12% Jun 13 Dec 12 146.1% 138.2% Erste Group stake 100% 127.7% 127.6% 10% Solvency ratio 9.9% 11.7%
Slide 75: Key local entity data – Erste Bank Croatia
Key local entity data (IFRS, consolidated) – Erste Bank Croatia Key figures and ratios 1-6 13 1-6 13 Change Rate and margin environment Cost/income ratio 37.7% 39.4% Return on equity 4.7% 9.0% 180% 154.9% 6% Jun 13 Dec 12 147.0% 150.2% 150.0% 147.5% Erste Group stake 69.3% 150% Solvency ratio 16.4%
Slide 76: Key local entity data – Erste Bank Serbia
Key local entity data (IFRS, consolidated) – Erste Bank Serbia Key figures and ratios 1-6 13 1-6 12 Change Rate and margin environment Cost/income ratio 63.7% 67.7% 109.6% 114.5% Return on equity 7.4% 8.0% 120% 104.0% 20% Jun 13 Dec 12 98.4% 96.2% Erste Group stake 80.5% 100% 12.7% 15% Solvency rati
Slide 77: Presentation topics
Presentation topics − Business performance − BCR update − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure HY 2013 results 30 July 2013 presentation 77
Slide 78: Strategy – A real customer need is the reason for all business
Strategy – A real customer need is the reason for all business Customer banking in Central and Eastern Europe Eastern part of EU Focus on CEE, limited exposure to other Europe Retail Corporate Capital Public Interbank banking banking markets sector business Focus on local Large, local corporate Focu
Slide 79: Strategy – Customer banking in the eastern part of the EU
Strategy – Customer banking in the eastern part of the EU Austria Czech Republic Slovakia − Leading retail and corporate bank Clients: 3.3m Clients: 5.3m Clients: 2.4m with 16.6m customers in 7 Retail loans: 19.0% Retail loans: 23.7% Retail loans: 26.4% geographically connected Retail dep.: 18.3% Re
Slide 80: Erste Group's intangible asset split
Erste Group’s intangible asset split – BCR goodwill and software are biggest items Intangibles composition 5 4 in EUR billion 3.2 3.2 2.9 2.9 2.8 3 0.6 0.6 0.3 0.6 0.6 0.6 0.3 0.2 0.2 0.3 0.3 0.2 2 0.5 0.2 0.2 0.2 0.5 0.5 0.5 0.5 0.4 0.4 1 0.3 0.3 0.4 0.3 0.3 0.3 0.3 0.3 0.9 0.8 0.6 0.6 0.6 0 Q2 12
Slide 81: Erste Group historic financials – Quarterly income statement (IFRS)
Erste Group historic financials – Quarterly income statement (IFRS) in EUR million Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Net interest income 1,401.9 1,430.2 1,434.9 1,336.9 1,314.8 1,317.2 1,266.4 1,240.6 1,190.6 Net fee and commission income 450.9 445.9 435.2 430.3 435.2 418.8 436.5
Slide 82: Erste Group historic financials – Quarterly balance sheet (IFRS)
Erste Group historic financials – Quarterly balance sheet (IFRS) in EUR million Jun 11 Sep 11 Dec 11 Mar 12 Jun 12 Sep 12 Dec 12 Mar 13 Jun 13 Cash and balances with central banks 6,605 5,743 9,413 5,480 5,737 8,675 9,740 7,446 9,626 Loans and advances to credit institutions 13,373 13,559 7,578 13,4
Slide 83: Quarterly segment reporting – Overview of main segments
Quarterly segment reporting – Overview of main segments in EUR million Retail & SME GCIB Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Net interest income 1,087.0 1,057.7 1,068.7 1,021.6 1,004.5 129.0 123.8 114.9 104.1 98.0 Risk provisions for loans and advances (329.3) (400.0) (394.7)
Slide 84: Quarterly segment reporting – Austria sub-segments
Quarterly segment reporting – Austria sub-segments in EUR million EB Oesterreich Savings banks Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Net interest income 150.5 155.3 150.3 151.4 146.6 235.8 225.0 238.3 220.0 219.5 Risk provisions for loans and advances (22.9) (27.2) (14.7) 2.5 (
Slide 85: Quarterly segment reporting – CEE sub-segments (1)
Quarterly segment reporting – Central and Eastern Europe sub-segments (1) CEE - Details in EUR million Czech Republic Romania Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Net interest income 288.0 272.0 271.2 252.8 246.5 131.3 139.4 148.7 149.9 146.6 Risk provisions for loans and adva
Slide 86: Quarterly segment reporting – CEE sub-segments (2)
Quarterly segment reporting – Central and Eastern Europe sub-segments (2) CEE - Details in EUR million Croatia Serbia Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Net interest income 64.8 62.9 61.9 57.8 61.2 9.4 8.5 10.5 9.8 9.6 Risk provisions for loans and advances (38.8) (36.6) (29
Slide 87: Group statistical data – Development of key financial ratios
Group statistical data – Development of key financial ratios in EUR million 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Jun 13 Tier 1 Capital pursuant to Austrian Banking Act 1.753 2.125 2.337 3.800 3.912 4.377 5.112 6.185 6.674 7.448 11.450 12.219 11.909 12.223 12.302 Tota
Slide 88: Presentation topics
Presentation topics − Business performance − BCR update − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure HY 2013 results 30 July 2013 presentation 88
Slide 89: Shareholder structure – Total number of shares: 429,800,000
Shareholder structure – Total number of shares: 429,800,000 By investor By region CaixaBank Other Austria ERSTE Stiftung Versicherungsv. 9.1% 2.7% direct Privatstiftung 15.1% Continental 4.1% Europe ERSTE Stiftung indirect* 27.1% 8.5% Austria Employees 42.4% 2.3% Retail investors 6.7% Institutional
Slide 90: Investor Relations contacts
Investor Relations contacts − Erste Group Bank AG, Graben 21, 1010 Vienna Fax : +43 (0)5 0100-13112 E-mail: investor.relations@erstegroup.com Internet: http://www.erstegroup.com/investorrelations http://twitter.com/ErsteGroupIR http://www.slideshare.net/Erste_Group Erste Group IR App for iPad, iPhon