Intercorp Financial Services Inc. · NYSE:IFS
Intercorp Financial Services — Q3 2024 Earnings Presentation
54 slides from Intercorp Financial Services's earnings presentation, Nov 13, 2024
Slide 1: Earnings Presentation 3Q24 results
Earnings Presentation 3Q24 results
Slide 2: Continuous improvement in economic indicators
Continuous improvement in economic indicators Quarterly GDP growth YoY (%) Interest rates (%) Soles reference rate (BCRP) Dollar reference rate (FED) 2024(E) 3.6% 4.0% 3.0% 7.50 6.75 1.4% 2024(8M) 6.00 5.75 Oct24 2.9% 5.25 5.0% 5.50 5.50 5.50 5.50 -0.5% -0.3% 5.00 Oct24 -1.0% (1) 4.75% 2Q23 3Q23 4Q2
Slide 3: Leading indicators remain optimistic
Leading indicators remain optimistic Consumer confidence index & business Formal employement & formal wage YoY (%) confidence(%) Consumer confidence index Business trust Formal employement Formal wage 9.0 8.2 5.6 5.7 55 59 59 59 52 2.2 44 41 39 40 35 2.4 1.0 0.6 1.4 -0.3 Sep23 Dec23 Mar24 Jun24 Sep2
Slide 4: Strategic focus on key businesses and profitability
Strategic focus on key businesses and profitability Growth Digital Focus Leading digital platform with Creating the best Boosting core profitable growth digital experience businesses +2x >15% 81% >15% 22% MS retail MS consumer YoY IFS Digital banking deposits loans net income ROE 3Q24 customers +16%
Slide 5: Sustainable growth
1 2 Digital Sustainable update growth 3 Key businesses 4 Takeaways
Slide 6: Sustainable growth
1 2 Digital Sustainable update growth 3 Key businesses 4 Takeaways
Slide 7: Key messages
Key messages 1 2 3 Improving banking and Lower CoR translates Better funding mix impacts investment results drive into better results for IBK positively cost of funds earnings recovery 390mn S/ -90bps -70bps Net profit QoQ CoR YoY CoF IFS 3Q24 4 5 6 Moderation in loan growth with improvement of cash
Slide 8: 2x YoY earnings drive quarterly ROE above 15%
2x YoY earnings drive quarterly ROE above 15% IFS quarterly net profit (S/ mn) ROE 8.2% 11.2% 15.1% ROE 10.2% 11.1% 14.4% 299 196 221 Banking(1) 390 +35% QoQ +52% YoY 3Q23 2Q24 3Q24 286 ROE 48.1% 58.5% 64.1% 79 67 Insurance 195 35 -14% QoQ +90% YoY 3Q23 2Q24 3Q24 ROE n.m. 2.7% 13.9% 33 management We
Slide 9: 5% YoY increase in revenues at IFS
5% YoY increase in revenues at IFS IFS quarterly revenues (S/ mn) NIM 5.6% 5.2% 5.3% IBK 1,282 1,249 1,294 NIM 5.1% 5.1% IFS 5.5% Banking +4% QoQ +1% YoY 3Q23 2Q24 3Q24 1,824 1,755 1,758 373 397 390 Insurance -3% QoQ +4% YoY 3Q23 2Q24 3Q24 83 management Wealth 47 +75% QoQ 18 +4.6x YoY 3Q23 2Q24 3Q24
Slide 10: CoR and NPLs close to normalized levels
CoR and NPLs close to normalized levels Banking Retail Commercial 8.1% Credit cards & 7.2% personal loans 23% 18% 5.3% Payroll deductible 5.0% 44% 47% loans 13% 4.0% Mortgages 3.1% -180bps 11% YoY 22% 1.0% 21% Commercial 0.1% 0.6% 3Q23 2Q24 3Q24 3Q23 3Q24 Cost of risk (%) Banking – Performing loans
Slide 11: Continuous improvement in payment behavior of customers
Continuous improvement in payment behavior of customers Non-rescheduled Rescheduled (S/ mn) 11,151 10,660 9,559 9,039 (2) Payment of rescheduled loans -15% QoQ 18% 20% 19% 17% -22% YoY Collected Not paid 89.5% 91.6% 10.5% 8.4% Jun24 Sep24 Jun24 Sep24 (2) 82% 80% 81% 83% Payment of non-rescheduled lo
Slide 12: +5% QoQ fee income driven by banking
+5% QoQ fee income driven by banking IFS fee Income (S/ mn) Banking fee income (S/ mn) 290 295 210 280 199 195 3Q23 2Q24 3Q24 3Q23 2Q24 3Q24 +5% QoQ | +2% YoY +8% QoQ | +6% YoY 12
Slide 13: Efficiency remains a top priority
Efficiency remains a top priority IFS expenses (S/ mn) Banking expenses (S/ mn) C/I 36.6% 38.6% 38.1% C/I 36.5% 39.7% 39.0% 744 526 719 491 515 688 3Q23 2Q24 3Q24 3Q23 2Q24 3Q24 +3% QoQ | +8% YoY +2% QoQ | +7% YoY 13
Slide 14: Digital
1 2 Digital Sustainable update growth 3 Key businesses 4 Takeaways
Slide 15: IFS digital platform
IFS digital platform IzipayYa Izipay Digital bank Investments Insurance Cuenta Sueldo Marketplace Loyalty & promotions Digital My financing Piggy Payments finances bank 100% digital account
Slide 16: Improving customer experience
Improving customer experience 81% 67% 62% 75% Sep23 Sep24 Sep23 Sep24 Digital customers - Retail Digital sales - Retail (% of digital customers – Retail banking) (% of products sold digitally) 78% 76% 66 63 Sep23 Sep24 Sep23 Sep24 Digital self-service NPS Retail (Points – Retail Banking) (% of digit
Slide 17: We are creating value and primary banking relationships with Plin
We are creating value and primary banking relationships with Plin +2.2x Primary vs non primary banking relationships KPIs YoY (Data as of Sep24) 129.8 105.1 1.6x Cross 3x NPS 59.0 1.4x Deposit balance -98% Churn 3Q23 2Q24 3Q24 IBK Transactions (mn) (1) (1) Sent transactions Plin
Slide 18: Continuous increase in float from Izipay
Continuous increase in float from Izipay 5.9 1.6 4.5 5.3 +31% 1.1 +2.8x YoY YoY 0.6 3Q23 2Q24 3Q24 3Q23 2Q24 3Q24 Cash flow coming to IBK accounts (S/ bn) Volumes from micro merchants (S/ bn) +43% +53% YoY Increased float in YoY More float from merchants’ IBK accounts micro merchants 18
Slide 19: Increasing digital adoption in insurance and WM
Increasing digital adoption in insurance and WM 65% 82% 14% 79% 13% 57% Insurance 3Q23 3Q24 3Q23 3Q24 3Q23 3Q24 Digital self-service SOAT digital sales Digital premiums – Vida cash (% of digital self-service) (% of products sold digitally) (% of total life premiums) 53% 25% 45% 19% WM 3Q23 3Q24 Sep2
Slide 20: Key businesses
1 2 Digital Sustainable update growth 3 Key businesses 4 Takeaways
Slide 21: Gaining market relevance in key businesses
Banking Gaining market relevance in key businesses +10bps QoQ +10bps QoQ +40bps QoQ 22.7 21.8 21.9 19.4 18.8 18.9 14.5 14.0 14.1 Sep-23 Jun-24 Sep-24 Sep-23 Jun-24 Sep-24 Sep-23 Jun-24 Sep-24 MS Consumer loans (%) MS Retail loans (%) MS Payroll inflow (%) +40bps QoQ +40bps QoQ +90bps QoQ 15.2 15.0 1
Slide 22: Moderation in loan growth with slight recovery of cash loan disbursement
Moderation in loan growth with slight Banking recovery of cash loan disbursement Consumer loans Payroll deductible loans Quarterly disbursements (S/ mn) Mortgage Commercial 555 44,442 45,530 45,927 +3.3% 526 1,466 500 186 354 YoY 43% 46% 47% 1Q24 2Q24 3Q24 3Q23 2Q24 3Q24 Impulso MyPeru SME 21% 22% 2
Slide 23: 60 bps increase in QoQ risk-adjusted NIM
Banking 60 bps increase in QoQ risk-adjusted NIM % of unsecured 23% 19% 18% NIM Risk-adjusted NIM loans retail(1) Retail loans Comercial loans Yield on loans Return on interest-earning assets Financial Investments Cash and due from banks 70,273 72,959 68,872 11.6% 11.3% 14% 13% 18% 10.8% 10.6% 10.5%
Slide 24: -70bps YoY cost of funds on better funding mix and fast repricing
-70bps YoY cost of funds on better funding Banking mix and fast repricing LDR(1) 103% 99% 94% Ref. rate YoY - 225bps (S/) System’s -50bps (US$) LDR(1) 104% 98% 94% +7% 4.2% 4.2% 61,511 63,746 YoY 59,684 4.0% 7% 7% 8% 12% 16% 14% 3.6% 3.8% 3.8% 3.5% 38% 39% -70bps 36% YoY 76% 81% 3.4% 3.2% 40% 41% 42
Slide 25: Sustained growth on private annuities and diversified revenue generation
Sustained growth on private annuities and Insurance diversified revenue generation Annuities %chg %chg market 28.8% 30.5% 29.0% 31.5% QoQ YoY share(1) +7% +13% 355 333 314 -4% +129% 81 35 84 212 90 87 0% -3% 87 44 70 85 +7% +23% 71 80 34 119 102 +25% -15% 61 82 (2) 2019 3Q23 2Q24 3Q24 Quarterly gros
Slide 26: +19% YoY growth in AUM leads recovery of fee income in WM
Wealth +19% YoY growth in AUM leads recovery of management fee income in WM AUM (US$ mn) +19% YoY Diversified revenue generation (S/ mn) +5% QoQ Inteligo Bank Interfondos 6,817 7,129 42 43 +22% YoY 5,990 +2% QoQ 5,520 2,022 35 1,788 1,324 1,524 4,936 5,020 4,494 3,952 2019 3Q23 2Q24 3Q24 3Q23 2Q24 3
Slide 27: Sustainability update
1 2 Digital Sustainable update growth 3 Key businesses 4 Takeaways
Slide 28: Sustainability update
Sustainability update Environmental CSA results 2024 • First Climate Report disclosure • Sustainable loans for up to U$330 million • Climate-related risk analysis Social 69 CSA Score 2024 • Diversity and Inclusion programs (GoWomen Inspira, YoY Sin Fronteras). Corporate Sustainability • Human rights
Slide 29: Operating trends 9M24
Operating trends 9M24 Capital Profitability Loan growth 2024 9M24 2024 3Q24 9M24 Guidance Guidance Mid single digit growth IBK TCR > 14% 15.9% IFS ROE > 12% 15.1% 10.6% in total loans IBK CET1 ∼ 11% 12.2% 3Q24: 3.3%(1) To remain at sound levels Still below midterm range Real 3Q24: 2.1%(2) Revenues C
Slide 30: Takeaways
Takeaways 1 2 3 Improving banking and Lower CoR translates Better funding mix impacts investment results drive into better results for IBK positively cost of funds earnings recovery 4 5 6 Moderation in loan growth Sustained growth Strong increase in AuM with improvement of cash in insurance premiums
Slide 31: Appendix
Appendix
Slide 32: Loan book boosted by Impulso MyPeru
Banking Loan book boosted by Impulso MyPeru SME Mid-sized +1,400 +S/ 15,200 mn 50%-98% 31 auctions guarantee 65% levels +500 500 66% 35% 61% < 14% 6 months 34% 39% Average Grace period 1Q24 2Q24 3Q24 auction rate Impulso MyPeru disbursements (S/ mn) 32 Source: COFIDE from January 2024 to September 3
Slide 33: Solid results in the insurance investment portfolio
Solid results in the insurance investment Insurance portfolio Insurance - ROIP (%) Insurance - Portfolio breakdown 6.0% 5.4% 10% 9% 5% 5% 85% 86% 3Q23 3Q24 3Q23 3Q24 Fixed Income Equity and Mutual Funds Real Estate 33
Slide 34: IFS' 9M24 earnings
IFS’ 9M24 earnings 10.8% IFS net profit (S/ mn) ROE 12.8% 721 660 11.2% 10.6% Banking(1) ROE -8% YoY 793 817 9M23 9M24 ROE 65.6% 36.0% 155 126 Insurance -18% YoY 9M23 9M24 ROE 1.7% 9.3% management Wealth 66 9M23 9M24 12 +5.5x YoY +3% YoY 9M23 9M24 34 1) Includes participation in payments
Slide 35: 9M24 revenues at IFS
9M24 revenues at IFS IFS revenues (S/ mn) NIM 5.5% 5.3% NIM 5.3% 5.1% 3,762 3,751 0% YoY Banking 5,158 5,311 9M23 9M24 1,127 1,171 Insurance +4% YoY 9M23 9M24 197 management 122 Wealth +61% YoY 9M23 9M24 9M23 9M24 +3% YoY 35
Slide 36: Customer base growth continues across businesses
Customer base growth continues across businesses +12% YoY +16% YoY +16% YoY 5.5 3.0 4.9 83 2.6 71 Sep23 Sep24 Sep23 Sep24 Sep23 Sep24 Banking – customers (mn) (1) Wealth management – customers (th) Insurance – customers (mn) 36 (1) New methodology
Slide 37: IFS key indicators 3Q24
IFS key indicators 3Q24 11.2% 15.1% 5.6% 5.2% 5.3% 8.2% ROE NIM 3Q23 2Q24 3Q24 3Q23 2Q24 3Q24 5.0% 4.0% 1.2% 1.6% 3.1% Banking 0.9% ROA CoR 3Q23 2Q24 3Q24 3Q23 2Q24 3Q24 IFS 5.5% 5.1% 5.1% 36.5% 39.7% 39.0% NIM C/I ratio 3Q23 2Q24 3Q24 3Q23 2Q24 3Q24 5.6 6.8 7.1 36.6% 38.6% 38.1% C/I ratio AUM manag
Slide 38: IFS key indicators 9M24
IFS key indicators 9M24 11.1% 10.6% 5.5% 5.3% ROE NIM 9M23 9M24 9M23 9M24 4.0% 4.0% 1.2% 1.2% Banking ROA CoR 9M23 9M24 9M23 9M24 IFS 5.3% 5.1% 37.0% 39.1% NIM C/I ratio 9M23 9M24 9M23 9M24 5.6 7.1 34.6% 38.0% C/I ratio AUM management (US$ bn) 9M23 9M24 9M23 9M24 Wealth Insurance 109.6 124.0 ROIP 6.
Slide 39: Contained banking NPLs despite growth in provisions, S2 reflects rescheduling
Contained banking NPLs despite growth in provisions, S2 reflects rescheduling (S2+S3) ratio & S3 NPL ratio (%) Impairment loss on loans, net (S/ mn) & Cost of risk (%) 13.3% 6.0% 1,291 12.8% 581 11.7% 5.0% 549 5.2% 474 4.0% 5.0% 4.7% 377 3.0% 4.0% 3.1% 3.1% 3.2% 2.9%2.0% 1.0% 0.0% 3Q23 2Q24 3Q24 3Q2
Slide 40: Sound capitalization levels
Sound capitalization levels Banking System 16.3% 15.9% 16.8%(1) 127.1% 127.2% 126.9% TCR Insurance 100.0% Reg. min. 3Q23 2Q24 3Q24 15.0% 15.0% 15.9% 12.2% 11.2% 11.2% Solvency ratio Banking 11.7% Reg. 6.8% 17.8% management min. Reg. min. 16.0% 16.6% Wealth 12.0% Reg. min. 3Q23 2Q24 3Q24 3Q23 2Q24 3Q
Slide 41: Focusing on low-risk loans & retail deposits
Focusing on low-risk loans & retail deposits Breakdown of loans (S/ mn) Funding structure (S/ mn) %chg %chg %chg %chg 3Q23 2Q23 3Q24 QoQ YoY 3Q23 2Q23 3Q24 QoQ YoY Consumer loans Credit cards & other loans 10,599.6 8,864.1 8,462.1 -4.5% -20.2% Deposits 45,652.6 48,472.9 51,354.6 5.9% 12.5% Payroll d
Slide 42: Reactiva loan balances down 64% YoY, representing 1% of Interbank's portfolio
Reactiva loan balances down 64% YoY, representing 1% of Interbank’s portfolio Reactiva Peru loan balances by segment (S/ bn) 3Q24 Segment YoY Corporate -23% 1.0 Corporate: n.m. Mid-sized -63% Mid-sized: S/ 0.2 bn SME: S/ 0.1 bn 0.5 SME -67% 0.3 Total -64% 3Q23 2Q24 3Q24 42 SME Mid-sized Corporate
Slide 43: Manageable dollarization levels at Interbank
Manageable dollarization levels at Interbank Total loans Retail loans Commercial loans % PEN 69% 73% 90% 93% 57% 59% System 6% 4% 26% 25% 51% 48% 93% 96% 74% 75% 49% 52% 3Q19 3Q24 3Q19 3Q24 3Q19 3Q24 Retail loans breakdown Commercial loans breakdown Consumer Mortgages Corporate Medium Small & Micro
Slide 44: IFS' 3Q24 statement of financial position
IFS’ 3Q24 statement of financial position Intercorp Financial Services' Statement of financial position S/ million %chg %chg 09.30.23 06.30.24 09.30.24 09.30.24 09.30.24 06.30.24 09.30.23 Assets Cash and due from banks and inter-bank 11,106.4 10,413.4 14,663.7 40.8% 32.0% funds Financial investments
Slide 45: IFS' 3Q24 P&L
IFS’ 3Q24 P&L Intercorp Financial Services' P&L statement S/ million %chg %chg 3Q23 2Q24 3Q24 QoQ YoY Interest and similar income 1,849.0 1,737.1 1,765.6 1.6% -4.5% Interest and similar expenses -681.2 -623.3 -614.5 -1.4% -9.8% Net interest and similar income 1,167.8 1,113.8 1,151.1 3.3% -1.4% Impai
Slide 46: Banking segment's 3Q24 statement of financial position
Banking segment’s 3Q24 statement of financial position Banking Segment' Statement of financial position S/ million %chg %chg 09.30.23 06.30.24 09.30.24 09.30.24 09.30.24 06.30.24 09.30.23 Assets Cash and due from banks and inter-bank 9,579.5 9,374.2 13,345.5 42.4% 39.3% funds Financial investments 1
Slide 47: Banking segment's 3Q24 P&L
Banking segment’s 3Q24 P&L Banking Segment's P&L statement S/ million %chg %chg 3Q23 2Q24 3Q24 QoQ YoY Interest and similar income 1,590.9 1,484.4 1,505.8 1.4% -5.3% Interest and similar expenses -627.3 -559.4 -549.7 -1.7% -12.4% Net interest and similar income 963.5 925.0 956.1 3.4% -0.8% Impairmen
Slide 48: Insurance segment's 3Q24 statement of financial position
Insurance segment’s 3Q24 statement of financial position Insurance Segment' Statement of financial position S/ million %chg %chg 09.30.23 06.30.24 09.30.24 09.30.24 09.30.24 06.30.24 09.30.23 Assets Cash and due from banks and inter-bank 378.7 403.5 437.6 8.4% 15.5% funds Financial investments 12,01
Slide 49: Insurance segment's 3Q24 P&L
Insurance segment’s 3Q24 P&L Insurance Segment's P&L statement S/ million %chg %chg 3Q23 2Q24 3Q24 QoQ YoY Interest and similar income 212.5 205.9 213.7 3.8% 0.6% Interest and similar expenses -28.7 -36.4 -38.2 4.8% 32.9% Net interest and similar income 183.8 169.5 175.5 3.6% -4.5% Recovery (loss) d
Slide 50: Wealth management segment's 3Q24 statement of financial position
Wealth management segment’s 3Q24 statement of financial position Wealth Management Segment' Statement of financial position S/ million %chg %chg 09.30.23 06.30.24 09.30.24 09.30.24 09.30.24 06.30.24 09.30.23 Assets Cash and due from banks and inter-bank 1,061.6 551.8 682.8 23.7% -35.7% funds Financi
Slide 51: Wealth management segment's 3Q24 P&L
Wealth management segment’s 3Q24 P&L Wealth Management Segment's P&L statement S/ million %chg %chg 3Q23 2Q24 3Q24 QoQ YoY Interest and similar income 43.6 44.3 43.6 -1.5% 0.1% Interest and similar expenses -24.8 -27.2 -27.1 -0.4% 9.2% Net interest and similar income 18.7 17.1 16.5 -3.3% -11.9% Impa
Slide 52: Definitions
Definitions Concept Definition Net interest and similar income + Net fee income from financial services + Other income Total revenues + Income from insurance results (Salaries and employee benefits + Administrative expenses + Depreciation and amortization) / (Net Efficiency ratio interest and simila
Slide 53: Safe Harbor for Forward-Looking Statements
Safe Harbor for Forward-Looking Statements This corporate presentation contains “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1955. Other than statements of historical or current facts, all statements included in this presentation regarding IFS’ b
Slide 54: Intercorp Financial Services
; EJ Intercorp Fina
Intercorp Financial Services Inc. Common Shares — Q3 2024 Earnings Presentation on 6ix