Banca Generali S.p.a. · MIL:BGN
Banca Generali — H1 2014 Earnings Presentation
29 slides from Banca Generali's earnings presentation, Jul 29, 2014
Slide 1: 1H 2014 Results and Business Update
1H 2014 Results and Business Update Milan, 29 July 2014
Slide 2: An intense, busy half-year
An intense, busy half-year Strong interim net Excellent net inflows: Seized external profit: €88.4m (+24%) €2.3bn (+64%) growth opportunity • Strong results driven by • Ongoing positive • Signed agreement to recurring fees reflecting environment for raising acquire Credit Suisse’s higher assets and
Slide 3: Today's Agenda
Today’s Agenda 1H 2014 Results Net inflows, AUM and Recruiting External growth opportunities Closing Remarks Banca Generali 1H 2014 Results and Business Update 3
Slide 4: Best interim and best quarter results ever
Best interim and best quarter results ever Interim Net Profit Interim net profit at €88.4m 88.4 • Sustained net profit growth (+24%), 71.6 supported by a strong business momentum coupled with the +24% effective exploitation of financial market volatility (€ m) • Strong growth in management fees at €
Slide 5: Group 1H 2014 results
Group 1H 2014 results (€ m) * 6M13 6M14 % Chg * Results are reported excluding Net Interest Income 63.6 55.3 -13.1% Gross fees 200.7 222.8 11.0% Generali’s institutional business Fee expenses -81.8 -94.5 15.6% (GIL). No combined figure will be Net Fees 118.9 128.3 7.9% released anymore Net income (l
Slide 6: Very strong revenue growth
Very strong revenue growth Total banking income 229.3 202.1 188.7 176.3 +15.0% +21.5% 63.6 55.3 45.8 24.4 20.7 6.2 -81.8 -94.5 net interest recurring fees perf. fees fee expenses trading & Total margin dividend Revenues (€ m) 1H13 (lhs) – 1H14 (rhs) • Double-digit growth in recurring fees supported
Slide 7: Fee-income driven by strong management fees
Fee-income driven by strong management fees Breakdown of total gross fees 222.8 Fee margin +11% 200.7 20.7 1H 2012 1H 2013 1H 2014 24.4 17.3 Recurring fee margin 1.22% 1.32% 1.34% 15.7 o/w front 0.10% 0.12% 0.11% o/w management 1.01% 1.06% 1.12% o/w banking 0.11% 0.14% 0.11% +19% 168.0 141.6 Non rec
Slide 8: Strong progress for management fee
Strong progress for management fee (€ m) Mgmt fees run-rate 86.2 • Quarterly run-rate for management fees increased by +€4.4m (+57%) in 2Q 2014 vs. 81.8 +€2.8m avg. quarterly increase in 2012-13 78.9 • Run-rate increase linked to higher assets (+18%) and better product mix (managed assets at (€ m) 7
Slide 9: Divergent trend in NII components
Divergent trend in NII components Quarterly Net Interest Income Decoupling drivers • In the last 12 months, the Bank has successfully offset the sharp decrease in interest rates with a steady expansion 24.2 21.1 in volumes and lending activity 19.6 19.6 20.2 18.0 • Revenues from secured lending are
Slide 10: Costs well under control, net of one-offs
Costs well under control, net of one-offs Operating expenses Staff costs net of stamp duty1 37.4 34.4 78.4 +8.7% 74.5 (€ m) 1H13 1H14 • Increase in staff costs driven primarily by higher +5.3% provisions for variable compensation G&A costs ex-stamp duty 37.6 39.0 (€ m) +3.5% (€ m) 1H13 1H14 1H13 1H1
Slide 11: Profitability ratios at best practice levels
Profitability ratios at best practice levels AUM profitability Cost/Income ratio 1.91% 1.97% 79.7% 1.85% 0.18% 67.5% 0.26% 0.14% 60.9% 0.47% 0.37% 0.43% 51.9% 56.8% 55.4% 46.9% 45.6% 50.2% 1.34% 39.5% 38.2% 1.32% 33.3% 1.22% 1H12 1H13 1H14 1H09 1H10 1H11 1H12 1H13 1H14 Cost/Income ratio Performance
Slide 12: Capital ratios reaffirmed at solid levels
Capital ratios reaffirmed at solid levels Excess Capital Tier 1 Capital Ratio Total Capital Ratio 146.8 14.8% 144.3 14.2% 14.0% 13.5% 13.0% 11.8% 105.8 2012 2013 1H14 2012 2013 1H14 2012 2013 1H14 (€ m) The slight decrease in the capital ratios (T1 and TC) is due to the impact of Basel 3 (applied he
Slide 13: Today's Agenda
Today’s Agenda 1H 2014 Results Net Inflows, AUM and Recruiting External growth opportunities Closing Remarks Banca Generali 1H 2014 Results and Business Update 13
Slide 14: Over €1.1 million net inflows per advisor in just six months
Over €1.1 million net inflows per advisor in just six months Total organic net inflows €1.1m per FA in six months 1,667 • On a stand-alone basis, 1H 2014 1,412 net inflows posted a new record 1,044 high at €1.7bn (+18%) 646 579 +18% • Implied net inflows/FA equal to €1.1m, ca. +50% compared to the e
Slide 15: Jumbo recruitment from Simgenia drives target higher
Jumbo recruitment from Simgenia drives target higher 1H 2014 net inflows New 2014 target 3,000 648 2,315 2,000 1,667 (€ m) 1H 2014 Simgenia SIM 1H 2014 - (figures at 30 restated Previous target New target (€ m) June 2014) 1H 2014 net inflows at €2.3bn (incl. the jumbo recruitment from Simgenia SIM)
Slide 16: Focus on BG Stile Libero bears fruits
Focus on BG Stile Libero bears fruits Net inflows in managed products BG Stile Libero: 2,800 delivery above targets • In 1H 2014, full commercial focus 2,061 was put on ‘BG Stile Libero’, an +241% insurance wrapper of funds, SICAVs, 1,587 ETF and segregated insurance 676 accounts • BG Stile Libero w
Slide 17: Recruiting on track with 2013 record levels
Recruiting on track with 2013 record levels No. of recruits per year Recruiting trend • 1H 2014 recruiting stronger than in 1H 2013 +53% 81 (51 vs. 37 people) • Recruiting policy remains focused on top professionals (avg. portfolio over €17m) 51 46 52 53 51 • Total FA’s number at the end of June was
Slide 18: Strong increase in assets
Strong increase in assets Total assets Managed vs. Banking products 32.3 +18% 27.4 23.8 9.2 19.7 (74%) 7.7 (72%) 3.5 3.1 0.7 (€ bn) 7.7 8.5 (28%) (26%) 10.4 1H13 1H14 8.9 banking products managed products 2.2 2.6 (€ bn) 5.5 5.9 Managed asset at 74% of total 1H13 1H14 (incl. Ex-Simgenia • Total asset
Slide 19: Double digit increase for SICAVs
Double digit increase for SICAVs Lux-based SICAVs Lux-based Assets 7.5 Asset split +25% 6.8 1% 1% +21% 6.0 13% 17% 2% 5.6 15% 6.0 6.4 53% 5.25.2 (€ m) Equity EM Flexible EM ( €bn ) 0.4 0.8 Flexible funds Equity Global & Thematic 0.8 1.1 Equity DM Real assets 1Q13 1Q14 1H13 1H14 (Assets at 30 June, 2
Slide 20: Today's Agenda
Today’s Agenda 1H 2014 Results Net Inflows, AUM and Recruiting External growth opportunities Closing Remarks Banca Generali 1H 2014 Results and Business Update 20
Slide 21: A double leap of growth
A double leap of growth A double action to reinforce both Banca Generali’s networks at a time Signed agency contract with selected financial advisors of the former Simgenia SIM (Assicurazioni Generali group) Signed agreement to acquire Credit Suisse’s Italian affluent and upper affluent private
Slide 22: Cherry-picking of top quality FAs from Simgenia SIM
Cherry-picking of top quality FAs from Simgenia SIM Simgenia Sim: No. of FA… Simgenia SIM 1 FAs recruited by • Banca Generali recruited 69 financial 69 Banca Generali advisors from Simgenia with a portfolio of €648 m (excl. insurance assets) already fully transferred into 1,110 Banca Generali at 1H
Slide 23: Acquired Credit Suisse operations at a glance
Acquired Credit Suisse operations at a glance CS operations acquired • Banca Generali has signed an TOTAL ASSETS 1 ca.€2.0 bn agreement to acquire the Italian affluent and upper affluent private banking operations of Credit Suisse No. of PRIVATE • The operations acquired are made BANKERS 2 59 up by
Slide 24: Strategic rationale: a perfect fit to existing business
Strategic rationale: a perfect fit to existing business • Strengthen market share in the private banking sector Market positioning • Reinforcing BG’s presence in the North and Centre of Italy • Same FA culture and approach to customers service Distribution • Increased productivity of the operations
Slide 25: Financial rationale: Exploiting financial leverage
Financial rationale: Exploiting financial leverage Terms of the deal Total consideration of ca. €47-50m, in any case based on the amount of assets at the closing date Deal financed with cash and bond (mix to be defined) Planned issue of a subordinated bond Tier 2, up to the maximum size of the
Slide 26: Agenda
1H 2014 Results Net Inflows, AUM and Recruiting External growth opportunities Closing Remarks Banca Generali 1H 2014 Results and Business Update 26
Slide 27: Closing remarks
Closing remarks Top-rated network Return to Customised shareholders advisory Long-term Sustainability customer of results relationship We aim to be the first choice for: Clients, Financial Advisors and Investors Banca Generali 1H 2014 Results and Business Update 27
Slide 28: 2014 Upcoming Corporate Events
2014 Upcoming Corporate Events NOVEMBER Approval of 9M 2014 Su Mo Tu We Th Fr Sa results Investor Relations Contacts 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Giuliana Pagliari 16 17 18 19 20 21 22 Investor Relations Officer Phone +39 02 6076 5548 23 24 25 26 27 28 29 Mobile +39 331 65 30 620 E-mail: giul
Slide 29: Disclaimer
Disclaimer The manager responsible for preparing the company’s financial reports (Stefano Grassi) declares, pursuant to paragraph 2 of Article 154- bis of the Consolidated Law of Finance, that the accounting information contained in this press release corresponds to the document results, books and a