Brd Groupe Societe Generale Sa (romania) · BVB:BRD
Brd Groupe Societe Generale Sa (romania) — BRD Groupe Société Générale — Q3 2016 Earnings Presentation
30 slides from Brd Groupe Societe Generale Sa (romania)'s earnings presentation, Nov 4, 2016
Slide 1: BRD Group Results 3rd Quarter and First 9 Months 2016
BRD GROUP RESULTS 3RD QUARTER AND FIRST 9 MONTHS 2016 4 NOVEMBER 2016
Slide 2: Disclaimer
DISCLAIMER The consolidated and separate financial position and income statement for the period ended September 30, 2016 were examined by the Board of Directors on November 2, 2016. The financial information presented for the period ended September 30, 2016 and comparative periods has been prepared
Slide 3: Content
CONTENT CHAPTER 01_INTRODUCTION CHAPTER 02_MACROECONOMIC AND BANKING ENVIRONMENT CHAPTER 03_3RD QUARTER AND FIRST 9 MONTHS 2016 GROUP RESULTS CHAPTER 04_CONCLUSIONS 4 NOVEMBER 2016 | P.3
Slide 4: Q3-2016 and 9M 2016: Strong Increase in Profitability
Q3-2016 AND 9M 2016: STRONG INCREASE IN PROFITABILITY Higher net banking income by 3.2% vs Q3 2015 and by 9.6% vs 9M 2015 (+4.2% excluding non-recurring items) thanks to confirmed growth trend in net interest income and commissions Significantly higher Operating expenses up +1.7% vs Q3 2015 but lowe
Slide 5: BRD Group Key Figures
BRD GROUP | KEY FIGURES Q3-2015 Q3-2016 Variation 9M-2015 9M-2016 Variation Net banking income (RON m) 656 677 +3.2% 1,925 2,111 +9.6% Operating expenses (RON m) (321) (326) 1.7% (1,042) (1,032) -0.9% Gross operating income (RON m) 335 350 +4.6% 884 1,079 +22.1% Financial results Cost of risk (RON m
Slide 6: Macroeconomic and Banking Environment
CHAPTER 02 MACROECONOMIC AND BANKING ENVIRONMENT 4 NOVEMBER 2016 | P.6
Slide 7: Solid Economic Growth, Mostly Driven by Domestic Demand
SOLID ECONOMIC GROWTH, MOSTLY DRIVEN BY DOMESTIC DEMAND GDP EVOLUTION Strong GDP growth in Q2 2016, up 5.9%* year on year and 1.5%* quarter on quarter, driven by significant advance of private consumption and 4.5% to a smaller extent by higher investment activity. 3.5% 3.8% 3.0% CPI reached -0.6% y/
Slide 8: Banking Sector: Higher Propensity to Save, Subdued Corporate Credit Demand
BANKING SECTOR: HIGHER PROPENSITY TO SAVE, STILL SUBDUED CORPORATE CREDIT DEMAND 10.5% deposit growth at September 2016 BANKING SYSTEM DEPOSITS (RON bn) yoy* end versus September 2016 end: 274 270 +10.5% 247 8.8% higher household savings +12.7% 122 119 105 12.7% growth in company deposits +8.8% 142
Slide 9: Banking Sector: Further Decline of NPL Ratio
BANKING SECTOR: FURTHER DECLINE OF NPL RATIO FOLLOWING PORTFOLIO CLEAN-UP OPERATIONS BANKING SECTOR NPL RATIO* Loss 2 NPL ratio EBA NPL ratio 21.9% 20.7% 18.2% 14.3% 13.9% 13.6% 10.6% Dec-11 Dec-12 Dec-13 Dec-14 Dec-14 Dec-15 Aug-16 3 4 NPL ratio for the banking system continued to decline, driven b
Slide 10: 3rd Quarter and First 9 Months 2016 Group Results
CHAPTER 03 3RD QUARTER AND FIRST 9 MONTHS 2016 GROUP RESULTS 4 NOVEMBER 2016 | P.10
Slide 11: Continuously Expanding Customer Base Over the Last 2 Years
CONTINUOUSLY EXPANDING CUSTOMER BASE OVER THE LAST 2 YEARS EVOLUTION OF ACTIVE INDIVIDUAL CUSTOMERS* Increasing growth pace in the number of active (x 1000) individual customers +54K +54K y/y at September 2016 end +29K +29K y/y at September 2015 end Higher equipment rate (number of products per acti
Slide 12: Confirmed Positive Momentum in Loans to Individuals Production
CONFIRMED POSITIVE MOMENTUM IN LOANS TO INDIVIDUALS PRODUCTION Production of loans to individuals up +14.1% versus INDIVIDUALS’ LOAN PRODUCTION (RON m) Q3 2015 and +17.3% vs 9M 2015: Q3-16 vs. 9M-16 vs. Q3-15 9M-15 1,763 solid advance on unsecured consumer loans +14.1% +17.3% (+28.6% in Q3 2016 and
Slide 13: Strong Savings Collection on Diversified Supports
STRONG SAVINGS COLLECTION ON DIVERSIFIED SUPPORTS DEPOSITS (outstanding amounts, RON bn) Deposits up 5.7%* compared to September 2015 yoy* ytd* end with savings from retail clients the main growth driver 41.1 40.6 +5.7% -0.6% 38.3 Year to date evolution influenced by the peak 17.4 16.0 +2.9% -7.9% 1
Slide 14: Broad-Based Net Banking Income Increase
BROAD - BASED NET BANKING INCOME INCREASE NET BANKING INCOME (RON m) Net banking income up both in the 3rd quarter and in the first 9 months of 2016 yoy Despite the low interest rate environment, higher net interest income on volume growth 656 677 +3.2% and favorable structure shifts Net interest +2
Slide 15: Net Banking Income Excluding Non-Recurring Items
NET BANKING INCOME EXCLUDING NON-RECURRING ITEMS Net banking income up yoy excluding non- NET BANKING INCOME recurring items, in the 3rd quarter (+2.3%) as excl. non-recurring items (RON m) well as in the first 9 months of 2016 (+4.2%) yoy Non-recurring elements booked in other 656 671 +2.3% income
Slide 16: Costs Maintained Under Strict Control
COSTS MAINTAINED UNDER STRICT CONTROL Operating expenses further reduced by 0.9% in the first 9 OPERATING EXPENSES (RON m) months of 2016: yoy non staff expenses down 6.0% due to savings on 321 326 +1.7% real estate and sundry costs and lower contributions to the Bank Deposits Guarantee Fund Staff 1
Slide 17: Solid Operational Performance
SOLID OPERATIONAL PERFORMANCE GROSS OPERATING INCOME (RON m) Sustained growth in gross operating +22.1% 1,079 income stemming from improved net banking income and costs containment 884 127 Non-recurring 21 items +4.6% Gross operating income up 22.1% 350 +10.3% 335 (+10.3% excluding non- recurring it
Slide 18: Asset Quality
ASSET QUALITY Loan portfolio market mix GROSS LOANS - September 30, 2016 BREAKDOWN BY SEGMENT & 60% on individuals segment CURRENCY (in RON bn) 40% on companies segment 12.2 13.7 Consolidation of RON lending Individuals RON Share of RON denominated loans at around Companies FX 17.1 55% (versus 49% a
Slide 19: Cost of Risk and Coverage Ratio
COST OF RISK AND COVERAGE RATIO COST OF RISK EVOLUTION (in RON m)* 2016 highlights 2 500 600 Overall resilient risk profile for individuals 2 083 1 883 500 2 000 Confirmed limited impact from payment-in- kind legislation 1 500 1 193 400 1 193 300 Some further upgrade of the Bank’s 1 000 800 198 212
Slide 20: Significant Rise in Net Profit
SIGNIFICANT RISE IN NET PROFIT NET PROFIT (RON m) Strong advance in net profit benefiting from positive 606 contribution across all segments +67.9% 107 Net non- up +75.7% y/y in Q3 2016 recurring items 361 +75.7% 225 up +67.9% y/y in the first 9 months of 2016 5 18 128 +45.4% 499 Net profit 0 +72.0%
Slide 21: Self-Funded on a Standalone Basis
SELF-FUNDED ON A STANDALONE BASIS Consolidation of net loan to deposit ratio: 69.9% at NET LOANS AND DEPOSITS (RON bn) September 2016 end versus 72.2% at September 2015 end, on lower FX loan to deposit ratio (from 107.8% 101.8% 82.7% to 77.1%) and wider deposit base (from RON 40.0 100.0% 38.3bn to R
Slide 22: Robust Capital Position Supportive for Future Growth
ROBUST CAPITAL POSITION SUPPORTIVE FOR FUTURE GROWTH Bank only Sep-15 Dec-15 Sep-16 Solid capital base composed of high quality Tier 1 eligible instruments: share capital, retained Capital adequacy ratio 17.2% 18.1% 19.1% earnings, reserves Own funds (RONm) 4,572 4,857 5,167 Capital adequacy ratio w
Slide 23: Conclusions
CHAPTER 04 CONCLUSIONS 4 NOVEMBER 2016 | P.23
Slide 24: Conclusions
CONCLUSIONS BRD group delivered a strong operational and financial performance in the first 9 months of 2016. Net banking income continued to increase markedly in spite of the low interest rates, costs were contained, and the downward evolution of the net cost of risk was confirmed. Moreover, with i
Slide 25: Q&A Session
Q&A Session 4 NOVEMBER 2016 | P.25
Slide 26: Appendix
APPENDIX 4 NOVEMBER 2016 | P.26
Slide 27: BRD Key Figures for Bank Only
BRD | KEY FIGURES FOR BANK ONLY Q3-2015 Q3-2016 Variation 9M-2015 9M-2016 Variation Net banking income (RON m) 619 634 +2.4% 1,834 2,015 +9.9% Operating expenses (RON m) (303) (308) 1.6% (987) (975) -1.2% Gross operating income (RON m) 316 326 +3.1% 847 1,040 +22.8% Financial results Cost of risk (R
Slide 28: BRD Stock Price Performance
BRD STOCK PRICE PERFORMANCE 13.0 Market capitalisation 4,000 EUR 1.7bn 12.0 3,500 3,000 11.0 2,500 10.0 2,000 9.0 1,500 8.0 1,000 7.0 500 6.0 0 Volume ('000 shares, rhs) Price (RON, lhs) BRD is part of the main market indices on the Bucharest Stock Exchange BRD is in Top 5 largest domestic companies
Slide 29: Glossary – Client Segmentation
GLOSSARY – CLIENT SEGMENTATION The Retail category is comprised of the following customer segments: Individuals – BRD provides individual customers with a range of banking products such as: savings and deposits taking, consumer and housing loans, overdrafts, credit card facilities, funds transfer an
Slide 30: Thank You
THANK YOU Investor Relations Tel. : +4 021 380 47 62 Email : investor@brd.ro Homepage: www.brd.ro 4 NOVEMBER 2016 | P.30
BRD Groupe Société Générale — Q3 2016 Earnings Presentation on 6ix