Credito Emiliano S.p.a. · MIL:CE
Credito Emiliano — Credem — Q1 2007 Earnings Presentation
26 slides from Credito Emiliano's earnings presentation, May 2007
Slide 1: CREDEM 1Q07 Results
CREDEM 1Q07 Results 1 Investor Relations may 2007
Slide 2: CREDEM at a Glance
• CREDEM at a Glance • Key Data • 1Q07 Results • Long Term Strategy 2 Investor Relations may 2007
Slide 3: Shareholding Structure
Shareholding Structure Pact among 230 shareholders More than 2,900 Maramotti family 35.5% other shareholders Pictet Cie 4.9% Eredi Savioli 2.9% Fincorrad 2.1% Allianz Subalpina 1.7% 72.9% 27.1% CREDEMHOLDING* Free Float 72.0% 28.0% CREDEM • Listed on Milano Stock Exchange since 1997 •Market cap arou
Slide 4: Business Areas
Business Areas Commercial Banking Wealth Management Investment Banking Other CREDEM 100% 98.5% 50% * 100% 100% Life Insurance 100% 100% 50% * 69.7% 100% FIDUCIARIA Spa General Insurance 100% * na 100% * 100% 100% 100% 100% 100% • 516 branches and corporate centres in Italy • 790,000 customers and ov
Slide 5: Network and Human Resources
Network and Human Resources Group branches as at 31 March, 2007 12/31/06 3/31/07 Credem Branches & others 447 454 B.ca Euromobiliare Branches 21 21 4 Total Branches 468 475 69 17 18 Corporate Centres 41 41 7 129 Credem Points 25 23 14 6 Banca Euro Financial Stores 37 36 3 3 18 1 1 51 43 12/31/06 3/3
Slide 6: Focus on Emilia-Romagna
Focus on Emilia-Romagna Main Industrial Districts REGGIO EMILIA • Region of Emilia-Romagna rating: Aa2 stable /A+ MIRANDOLA agricoltular stable, Moody’s/S&P biomedical BOLOGNA machinery, motorbikes, fashion CARPI • About 4.1 million people (7% of the Italian packaging machinery PIACENZA knitwear pop
Slide 7: Key Data
• CREDEM at a Glance • Key Data • 1Q07 Results • Long Term Strategy 7 Investor Relations may 2007
Slide 8: Comparison with the Industry
Comparison with the Industry* CREDEM Sample** Average Non Interest Income/ Total Income 60.7% 47.9% Spread 3.32% 3.82% Cost to Income (including D&A) 60.5% 56.1% EBIT 39.5% 43.8% Operating Profit/RWAs 2.82% 2.36% NPL ratio 0.22% 1.24% ROE*** 16.7% 11.0% *FYO6 figures **Sample includes BPM, BPU, BPVN
Slide 9: Trends
Trends Key Indicators Revenues growth 1,061 945 1,100 1,000 816 69 FY04 FY05 FY06 54 131 900 101 800 43 79 EBIT/Total Income 30.1% 35.2% 39.2% 700 421 EURm 600 415 Revenues per Employee (EUR,000) 164.0 190.0 211.4 500 376 Oper. Costs per Employee (EUR,000) 108.6 123.9 123.3 400 300 Non Interest Inco
Slide 10: Value Creation
Value Creation ROE EPS EUR .1% Avg 15 23.2% 21.3% 0.90 0.82 19.3% 13.5% 14.6% 0.51 0.51 11.6% 11.1% 0.39 0.40 0.35 8.5% 0.26 14.8% 0.22 0.17 13.5% cagr 15.7% 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Dividend and Payout Ratio Capital Adequacy
Slide 11: 1Q07 Results
• CREDEM at a Glance • Key Data • 1Q07 Results • Long Term Strategy 11 Investor Relations may 2007
Slide 12: Tableau de Bord: Total Income and Operating Costs
Tableau de Bord Total Income Cont’d Operating Costs 400 200 160.3 +7.2% 274.6 +6.4% 149.6 300 150 258.2 59.4 +2.2% 58.1 EURm EURm 149.7 -2.4% 100 200 153.4 100 50 91.5 100.9 +10.3% 104.8 124.9 +19.2% 0 0 1Q06 1Q07 1Q06 1Q07 Net interest income Non-interest income Payroll costs Admin. expenses Consol
Slide 13: Tableau de Bord: Efficiency and Profitability
Tableau de Bord Efficiency Profitability 150 39.5% 39.2% 40.0% 120% 97.5% 107.0% 100 EURm 80% 59.4% 54.4% 20.0% 50 102.0 107.6 40% 0% 0 0.0% 1Q06 1Q07 1Q06 1Q07 EBIT EBIT/Total Income Non Interest Income /Total Income Operating Costs/Non Interest Income ROE Capital adequacy 1,300 7.6% 7.6% 7% 80 5.8
Slide 14: Income Statement
Income Statement Total Income breakdown EURm 1Q06 FY06 1Q07 % yoy EURm 1Q06 FY06 1Q07 % yoy Total Income 258.2 1,060.9 274.6 6.4 Net Interest Income 104.8 440.3 124.9 19.2 Operating Costs -149.6 -618.8 -160.3 7.2 Commercial Spread 3.29 3.39 3.69 43bps EBITDA 108.6 442.1 114.3 5.2 Avg loan rate 4.34
Slide 15: Importance of Core Business
Importance of Core Business Core business companies are defined as those involved in activities relying on the distribution network of the group Total Income Net Profit EURm 1Q06 FY06 1Q07 %y/y EURm 1Q06 FY06 1Q07 %y/y Core business 221.0 932.4 237.3 7.3 Core business 49.7 195.5 49.7 0.0 Credem 187.
Slide 16: Lending
Lending Lending volumes Loans by clients segment 6.0 14.7 +14.7% 15 12.8 14.4 5.0 5.0 2.1 2.2 +14.7% 4.0 3.9 3.6 12 1.9 4.0 3.4 3.5 EURbn 3.1 3.2 3.0 3.0 4.4 EURbn 2.8 4.3 +23.1% +16.7% 3.0 2.5 2.5 9 3.6 1.8 1.7 1.8 1.8 +5.4% 2.0 1.6 1.4 6 1.0 3 5.6 6.2 6.3 12.1% 0.0 0 FY03 FY04 FY05 FY06 1Q06 FY06
Slide 17: Credit Quality
Credit Quality • Credit quality consistently high, with an NPL ratio of 0.23% • The management and collection of loans securitized in late 2000 (0.22% at December ‘06) compared to an industry average of continued with success. As at 31 December, 2006: 1.25% (Sources: Bank of Italy) - EURm 198 collec
Slide 18: Funding
Funding EURm 1Q06 FY06 1Q07 % yoy Mutual Funds breakdown Deposits 8,736 10,020 10,106 15.7 100% 359.3 Flex 751.3 702.0 Bonds 4,131 4,431 5,880 42.3 90% 80% 2,182.0 27.8% Portfolio Management 5,317 5,931 6,169 16.0 1,899.7 24.0% Cash 70% 1,885.0 29.6% Mutual Funds and SICAVs 10,365 8,969 8,734 -15.7
Slide 19: Long Term Strategy
• CREDEM at a Glance • Key Data • 1Q07 Results • Long Term Strategy 19 Investor Relations may 2007
Slide 20: 1990 – 2006: Long Term Strategy
1990 – 2006 : Long Term Strategy 1990 – 1999 2000 – 2003 2004 – 2006 ACQUISITIONS ORGANIC GROWTH PROFITABILITY • Acquisition of more than 30 • Divisionalisation • Value creation from acquired small banks potential • 113 new branches opened • Acquisition in 1994 of • Central role of CREDEM’s core Eur
Slide 21: Organic Growth: a choice confirmed
Organic Growth: a choice confirmed 106 NEW branches and 40 corporate centres opened Loans & Fundings market shares - Italy s : n 6 year 26.0 si 24.0 v o lume a n k! 1.66% 22.0 ne w a ll b 1.50% 1.60% of m 1.53% 1.51% gas 20.0 1.50% 18.0 bil lions i rin 1.45% 16.0 24 acqu 1.25% 14.0 like 12.0 1.00% 1
Slide 22: 2006-2008 Business Plan Guidelines
2006-2008 Business Plan Guidelines STRATEGY 2008 GOALS CENTRAL ROLE OF CORE BUSINESS EXCELLENCE IN VALUE CREATION OVER TIME • Commercial Banking and Wealth Management activities generating well above 80% of Group’s • ROE consistently above 17% EBIT • Net Profit growing 11% cagr to 243 €million • Tar
Slide 23: Actions
Actions • 82 new branches, 2 new Corporate Centers, 9 closings. A larger, more up-to-date network. Areas to focus Selective increase for the growth: Nord East, North West, Tuscany and Marche. of the distribution network • New retail distribution model to aim at an higher effectiveness. Addition of m
Slide 24: 2008 Targets
2008 Targets CAGR Total Income Cont’d Operating Costs CAGR 1,200 1,158 7.0% 800 945 674 4.7% 700 900 586 649 4.5% 600 250 5.0% EURm 500 216 EURm 570 600 400 300 10.6% 300 509 200 423 370 4.6% 376 100 0 0 2005 2008P 2005 2008P Net interest income Non-interest income Payroll costs Admin. expenses Prof
Slide 25: 2008 Targets (cont'd)
2008 Targets Customer Cash Loans CAGR Cont’d Funding from Customers CAGR 15 80 6.8% 11.2% 67.5 60 55.3 17.3 27.7 3.5% EURbn EURbn 12 40 25.0 12.6 22.7 8.1% 20 18.0 3.7 8.0 29.0% 9 8.6 9.0 1.5% 0 2005 2008P 2005 2008P Customers deposits Bonds AUM AUC TIER I Distribution Channels 1,200 8% 600 62 7.7%
Slide 26: 2008 P&L
2008 P&L EURm 2005 2008P CAGR Total Income CAGR will reach 7% with a strong contribution from 05-08 the interest income. Net Interest Income 376 509 10.6% Operating Costs, including D&A are expected to increase by 5% Net Commissions 415 474 4.6% reflecting increasing commercial investments estimated