Eurobank S.A. · ATHEX:EUROB
Eurobank — EFG Eurobank Ergasias — H1 2002 Earnings Presentation
31 slides from Eurobank's earnings presentation, 2002
Slide 1: First Half 2002 Results
EFG Bs) Eurobank Ergasias FIRST HALF 2002 RESULTS
Slide 2: Hosts and Contents
Hosts and Contents First Half 2002 Nicholas Nanopoulos, CEO • Business Review Nikolaos Karamouzis, Deputy CEO • Financial Highlights • Financial Review Paula Hadjisotiriou, CFO 2
Slide 3: 1H 2002 Business Review
1H 2002 BUSINESS REVIEW
Slide 4: Business Environment Recent developments
Business Environment Recent developments LENDING • Credit expansion to domestic enterprises & households slowing down at an annualised 11.7% (April 2002) DEPOSITS • Down 2.8% since December 2001 EQUITY MARKET • ASE turnover down 39% to € 108 m in 1H 02 (1H 01: € 177 m) • Only 9 IPOs raising € 53.3 m
Slide 5: Enhancing our position in retail banking
Enhancing our position in retail banking….. • Consumer lending - expanding leadership position, achieving significant market market share gains: from 24% in Dec. ’01 to 25.6% (Apr ’02) • Mortgage lending – maintaining our market share at 11.3% (Apr. ’02) • Small Business Loans - growing strongly at
Slide 6: ...and in capital markets
…and in capital markets • Equity market: Significant market share gains in equity brokerage: from 10% in 1H 01 to 12.4% in 1H 02 • Bond Market : In 1H 2002 EFG Eurobank Ergasias became the No 1 Primary Dealer of government bonds • Advisory and Investment Banking: the Bank is the leading advisor to s
Slide 7: Other initiatives
Other initiatives • Altamira platform roll - out in progress • Targeted cross selling, with full client segmentation and identification of needs • Launching new bancassurance products • Alternative channels development 7
Slide 8: 1H 2002 Financial Highlights
1H 2002 FINANCIAL HIGHLIGHTS
Slide 9: 1H 2002 - Financial Highlights (IAS)
1H 2002 - Financial Highlights (IAS) Healthy business volume growth: – loans increased 26.5% to € 11.9bn (+21% excluding Telesis) – deposits up 7% to €16.4 billion Strong Net Interest Income growth of 20% to € 349m with NIM >3% Solid Fee Income growth of 9% to € 118m Strong Core income growth of 17%
Slide 10: 1H 2002 Financial Review
1H 2002 FINANCIAL REVIEW
Slide 11: Loan growth continues
Loan growth continues Loans up 26.5%* Net New Loans in 1Q & 2Q (+21% adjusting for Telesis) €m 600 In € m 500 560 11,919 12.000 21% 400 406 9,852 % 300 6.5 2 200 10.000 100 426 0 1Q 2002 2Q 2002 8.000 11.919 9.426 6.000 4.000 1H 2001 1H 2002 EFG Telesis *Settlement Balances not included 11
Slide 12: Retail Loans on the rise
Retail Loans on the rise Loan mix (% of total) 1H 2001 2001 1H 2002 100% 90% Wholesale: 57 % Wholesale: 61 % 80% 57% 70% 61% 59% 60% 50% % y.o.y. growth 40% 8% 7% 7% +47% Retail: 43 % Retail: 39 % 30% 17% 15% 15% +35% 20% 10% 18% 19% 19% +39% 0% Wholesale SBLs Mortgages Consumer 12
Slide 13: Healthy asset quality maintained despite strong rise in loans
Healthy asset quality maintained despite strong rise in loans – NPLs at 3.7% of total loans (organic NPLs below 3%) – Prudent policy upheld, with provisions increasing consistently with the rise in consumer lending (NPL coverage remains above 80%) 5.0% 4.5% 4.0% 3.5% 1.4% 1.0% 0.9% 3.0% Organic NPL’
Slide 14: Deposits-repos increased 7%
Deposits-repos increased 7% Deposits Breakdown* • Savings and other deposits up 20% 16,392 15,322 • Repos down 13.7% 15,000 (14)% 5,166 12,000 5,984 9,000 23 % 6,764 5,516 6,000 3,000 17 % 3,822 4,462 0 1H 2001 1H 2002 Savings Other Deposits Repos *excluding settlement balances 14
Slide 15: Customer Funds up 12% despite ASE drop
Customer Funds up 12% despite ASE drop Customer Funds In € m 25,000 23,435 20,970 3,604 20,000 3,555 11.2% 2,000 1,798 15,000 10,000 17,831 15,617 5,000 14.2% 0 1H 2001 1H 2002 Liquid Funds Mutual Funds Other investm ent products 15
Slide 16: Net Interest Income up 20%
Net Interest Income up 20% Steady improvement in NII Quarterly NII In € m owth 200 gr In € m % NIM q . o. q. 23 % 175 181 400 3.10% 171 168 3.13% 3.2 150 152 125 147 350 349 100 2.9 2Q 2001 3Q 2001 4Q 2001 1Q 2002 2Q 2002 300 9.5% 292 1 2.6 250 2.3 200 150 2 1H 2001 1H 2002 Net Interest Income NIM 1
Slide 17: Fee income up 9%
Fee income up 9% Fee Income Composition • Higher fees from In € m lending, new 9% services, debt 108 118 markets, treasury 120 sales, secondary offerings, advisory 100 • Lower fees from 55 brokerage, equity 54 fund management, 80 IPOs 60 17 15 40 16 No 1 ASE broker 14 with 12% market share in 1H02 2
Slide 18: Robust increase in core income
Robust increase in core income- income quality further improved Core Income Growth (17%) NII and Fees In € m contribute 96% 467 of total 500 17% operating 400 income 400 118 108 300 349 200 292 100 0 1H 2001 1H 2002 Net Interest Income Commissions & Fees 18
Slide 19: Recurrent Income
Recurrent Income Quarterly Evolution of Core Income (NII + Fees) In € m 250 246 238 229 200 215 194 150 100 2Q 2001 3Q 2001 4Q 2001 1Q 2002 2Q 2002 19
Slide 20: Other operating income: limited contribution in 1H 02
Other operating income: limited contribution in 1H 02 Composition of other operating income In € m 85 1H 2001 1H 2002 68 • Results on Trading and 65 Available for Sale portfolios 22m real estate affected by market conditions gain 45 • Lower dividends 4 18 • One-off real estate gains 25 30 of € 22 m
Slide 21: Lower profit on Trading and A.F.S. portfolios
Lower profit on Trading and A.F.S. portfolios In € m 1H 2001 1H 2002 34 40 3.2 • Lower Bond gains 11.6 30 1.9 • Lower FX gains 20 36.7 • Higher losses on equity positions 26.1 10 0 -5.9 -16.4 -10 -20 Bonds and Derivatives Equities FX 21
Slide 22: Total income growth penalised by drop in other operating income
Total income growth penalised by drop in other operating income Total operating income increased 3.4% y.o.y, up 8.6% excluding 1H 01 one-off real estate gains In € m 469 485 500 18 68 400 22m real estate 118 17% 108 96 % of total income 85 % of total income 300 200 349 292 100 0 1Η 2001 1Η 2002 Net
Slide 23: Underlying cost growth of 9%
Underlying cost growth of 9% Breakdown of operating expenses including Telesis in 1H 01 figures In € m 287 9.3% 300 262 32 250 29 12.9% 94 200 85 9.7% 150 100 148 161 8.4% 50 0 1Η 2001 1Η 2002 Personnel Administrative Depreciation 23
Slide 24: Cost expansion driven by investments in IT, alternative channels, new business
Cost expansion driven by investments in IT, alternative channels, new business Operating expenses as reported (IAS) • Depreciation charges up In € m 287 20% 300 13.6% 252 32 • Altamira rollout 250 20 % 27 • Introduction of the euro 200 94 82 • Telesis not included in 150 1H costs under IAS 100 143 1
Slide 25: Cost expansion decelerates to 13.6%
Cost expansion decelerates to 13.6% 1H 2002 vs. 1Q 2002 % change y.o.y per cost category % change y.o.y • Deceleration in y.o.y. 20 expansion rates of staff & 20 16.6 administrative expenses vs. 1Q 02 15 14.3 13.1 12.3 12 12.2 11.4 • Slowdown to continue in 10 the coming quarters 5 0 Personnel Admin
Slide 26: 2Q up 30% vs. 2Q, 1H down 6% vs. 1H
2Q 02 up 30% vs. 2Q 01 1H 02 down 6% vs. 1H 01 1Q & 2Q contribution to 1H Profit (6 ) % In € m 123 116 120 37 30 % 49 80 22* (22 )% 40 67 64 0 1H 2001 1H 2002 Q1 Q2 * € 22 m One-off real estate gains 26
Slide 27: Net profit up 15% excluding 1H 2001 one-off real estate gains
Net profit up 15% excluding 1H 2001 one-off real estate gains Group Net Profit Evolution 1H 2001 - 1H2002 In € m 130 120 22* 110 15% 116 100 90 80 101 70 60 50 40 30 20 10 0 1H 2001 1H 2002 * € 22 m One-off real estate gains 27
Slide 28: 1H 2002 - Financial Highlights (IAS)
1H 2002 - Financial Highlights (IAS) • Net Interest Income up 20% to €349m • Net Fee Income up 9% to € 118m • Group Net Profit at €116 m, down 6% • Return on Assets at 1.0% • Return on Equity at 12% • Tier 1 Capital Adequacy at 12.5% 28
Slide 29: Outperforming Peers
Outperforming Peers [Greek Banking sector & DJ Euro Stoxx Banks] Relative Performance (Jan – July 2002) 115 110 105 100 95 90 85 80 75 70 65 Jan-02 Feb-02 Mar-02 Apr-02 May-02 Jun-02 Jul-02 ATBA DJ 50 EFG 29
Slide 30: Share data
Share data 28.6.2002 28.12.2001 Market Capitalisation (€ m) 4,449 4,585 1H 2002 1H 2001 Average Trading Volume (‘000) 128 237 Number of Shares 313,310,348 293,007,590 Number of Shareholders 357,781 367,006 30
Slide 31: Investor Relations Contacts
Investor Relations Contacts EFG Eurobank Ergasias 8, Othonos Str, GR 105 57 Athens Tel.: +30-10-333-7688 Fax:+30-10-333-7150 investor_relations@eurobank.gr Internet: www.eurobank.gr Reuters: EFGr.AT Bloomberg: EUROB GA Datastream: G:EFG 31
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