Procredit Holding Ag · XETR:PCZ
Procredit — Q1 2024 Earnings Presentation
48 slides from Procredit's earnings presentation, May 13, 2024
Slide 1: Q1 2024 results
Hubert Spechtenhauser, Chairman of the Management Board Christian Dagrosa, CFO and member of the Management Board Q1 2024 results Frankfurt am Main, May 2024
Slide 2: Agenda
A. Highlights and business update B. Group results C. Regional performance D. Outlook ProCredit Group | Q1 2024 results | Frankfurt am Main, 13 May 2024 1
Slide 3: Highlights Q1 2024
Highlights Q1 2024 Strong start into the year after announcement of new medium-term ambitions Good loan and deposit growth in Q1-24 underline potential of new group business strategy 3.0% ► Loans grow strongly by 3.0%, growth momentum across all segments and all banks outside Ukraine loan growth (EU
Slide 4: Q1 2024 results versus guidance
Q1 2024 results versus guidance Guidance Actual FY 2024 Q1 2024 Around 10% 3.0% ► Growth of the loan portfolio (FX adjusted) (2.7% FX adjusted) 10% – 12% 13.4% ► Return on equity (RoE) (based on up to 40bps cost of risk) (with cost of risk of 2bps) Around 63% ► Cost-income ratio (CIR) 61.7% (with ma
Slide 5: Successful Tier 2 placement in Apr-24
Successful Tier 2 placement in Apr-24 supporting the group’s medium-term growth ambitions CASE STUDY ProCredit Holding AG successfully placed EUR 125m Green Tier 2 Bonds Summary of transaction: Main statistics: ► On 25-Apr-24, ProCredit Holding successfully placed green ISIN DE000A383C84 Tier 2 subo
Slide 6: Good portfolio growth driven by all customer segments
Good portfolio growth driven by all customers segments Loan portfolio growth ► Customer loans increase strongly by EUR 187m or 3.0% 5.8% YoY Growth driven by all segments, with particularly strong 3.0% QoQ relative growth in Micro (12.8%) and Private clients (6.7%) 6,108 6,061 6,226 6,414 548 552
Slide 7: Strong deposit development through digital banking channels
Strong deposit development through digital banking channels Deposit growth ► Customer deposits increase by EUR 200m or 2.8% 17.9% YoY Private client deposits grow strongly by more than 5% 2.8% QoQ (~80% of deposit growth in Q1), signaling good progress of the planned acceleration of ProCredit’s di
Slide 8: Strategic group positioning on SEE/EE
Strategic group positioning on SEE/EE, with positive expected GDP development and increased international focus on the region GDP outlook for SEE/EE remains intact, well above Euro area Macroeconomic environment / key current themes SEE/EE Euro area • Recent update of GDP growth estimates by IMF wit
Slide 9: Agenda: B. Group results
A. Highlights and business update B. Group results C. Regional performance D. Outlook ProCredit Group | Q1 2024 results | Frankfurt am Main, 13 May 2024 8
Slide 10: Operating income and expense overview
Operating income and expense overview Operating income ► Strong increase in operating income yoy by EUR 13m or 14%, 21.4% to EUR 107m 14.3% 412.5 107.2 Continued positive trajectory of net interest income with yoy 339.8 93.7 increase of 19% (in EUR m) (in EUR m) Net fee income and income from fx
Slide 11: Net interest income
Net interest income Quarterly development ► Q1-24 NII on good level of EUR 90.1m, slightly reduced with 3.9% 3.8% 3.6% 3.7% respect to Q4-23 3.4% Net interest margin at 3.7%, down 19 bps with respect to Q4, mainly driven by Serbia and Ukraine whilst other banks show broadly stable NIM/NII trajecto
Slide 12: Net fee and commission income
Net fee and commission income Quarterly development ► Q1-24 net fee and commission income on steady level of EUR 14.1m ► Fee and commission income up EUR 1.7m or 8% yoy Mainly due to increased income from card and payment services 14.0 14.9 14.4 14.3 14.1 (in EUR m) ► However, fee and commission e
Slide 13: Personnel and administrative expenses
Personnel and administrative expenses Quarterly development ► Personnel and administrative expenses of EUR 66.1m, down by EUR 4m or 6% compared to Q4-23 62.9% 59.7% 59.7% 61.7% 57.1% Mainly related to seasonal effects in Q4 (non-profit taxes; 70.1 66.1 62.4 provisions for untaken vacation etc.) 55
Slide 14: Loss allowance
Loss allowance Quarterly development ► Q1-24 loss allowance of EUR 0.3m at low level, corresponding to cost of risk of 2 bps as result of good loan portfolio quality 12 bps -9 bps 55 bps 42 bps 2 bps No parameter updates conducted in Q1-24 EUR 2.2m additional management overlays booked for Ukrai
Slide 15: Loan portfolio quality
Loan portfolio quality Loan portfolio by geography Net-write offs (annualised) Ecuador Germany Moldova 8% 1% Bulgaria 0.2% 0.1% 0.4% 0.5% 0.0% 3% 18% Georgia 7% Ukraine Greece¹ 7% 6% Stage 2 Albania 4% 8.8% 9.2% Bosnia & 8.6% Serbia 7.0% 7.5% Herzegovina 14% 5% Romania 6% North Macedonia Kosovo 8% 1
Slide 16: Regulatory capital, risk-weighted assets, capital ratios
Regulatory capital, risk-weighted assets, capital ratios Capitalisation overview ► CET1 ratio at 14.3% including recognition of Q1-24 result in EUR m Dec-23 Mar-24 CET1 capital 885 923 Capital ratios well above regulatory capital requirements of Additional Tier 1 capital 0 0 9.3% CET1, 11.5% Tier
Slide 17: Agenda: C. Regional performance
A. Highlights and business update B. Group results C. Regional performance D. Outlook ProCredit Group | Q1 2024 results | Frankfurt am Main, 13 May 2024 16
Slide 18: Contribution of regional segments to group net income
Contribution of regional segments to group net income Group functions, e.g. risk management, reporting, capital management, IT, liquidity management, training and development Includes ProCredit Holding, Quipu, ProCredit Academy Fürth, PCB Germany (EUR 41m loan portfolio; EUR 294m deposits) (Q1-24, i
Slide 19: Segment South Eastern Europe
Segment South Eastern Europe Segment key financials SEE Individual bank development (Q1-24) Operating income (€m) Cost-income ratio Country Profit after tax (€m) Cost-income Return on ratio equity +22% +0.1pp 71.0 Bulgaria 10.4 44.8% 20.6% 58.3 55.0% 55.1% Kosovo 6.7 49.8% 23.5% Serbia 5.2 53.5% 12.
Slide 20: Segment Eastern Europe
Segment Eastern Europe Segment key financials EE Individual bank development (Q1-24) Operating income (€m) Cost-income ratio Country Profit after tax (€m) Cost-income Return on ratio equity +11% +3.1pp Ukraine 6.9 32.7% 37.6% 45.6% 29.3 42.6% 26.4 Georgia 3.8 54.5% 14.8% Moldova 0.9 71.0% 7.4% Q1-23
Slide 21: Agenda: D. Outlook
A. Highlights and business update B. Group results C. Regional performance D. Outlook ProCredit Group | Q1 2024 results | Frankfurt am Main, 13 May 2024 20
Slide 22: FY 2024 and medium-term outlook
FY 2024 and medium-term outlook FY 2024 outlook ► Growth of the loan portfolio Around 10% (FX adjusted) ► Return on equity (RoE) 10% – 12% (based on up to 40bps cost of risk) ► Cost-income ratio (CIR) Around 63% (with margin of +/- 1 ppt) > 13.0% CET1 ratio, c. 9% leverage ratio, ► CET1 ratio, lever
Slide 23: Q&A
Q&A Photovoltaic project financed by ProCredit Bulgaria
Slide 24: Appendix
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | Q1 2024 results | Frankfurt am Main, 13 May 2024 23
Slide 25: Strong impact track record over the decades
Strong impact track record over the decades Consistently low net-write offs 5% Network of 4% Opening of the EV CHARGING Establishment of Published OUR RESPONSE 3% ProCredit academies STATIONS installed ProCredit as a ON FORCED LABOUR BANKING GROUP ALLEGATIONS related to 2% and consolidation of GREEN
Slide 26: Impact in ProCredit today
Impact in ProCredit today KPI: Jobs 200k jobs supported by our SMEs Jobs and investment KPI: Investment 64% of our lending goes to Social capital formation impact KPI: Gender Equity Diversity and 20% of our clients are inclusion women owned SMEs Sustainability at ProCredit Green energy KPI: Green Le
Slide 27: 2023 sustainability highlights and developments
2023 sustainability highlights and developments INTERNAL GREEN LENDING CLIENTS JOBS SUPPORTED EMPLOYEES ENVIRONMENTAL THROUGH OUR INDICATORS BUSINESS CLIENTS 61% 9,439 total number of business loan clients total number of employees 193,344 electric and hybrid total number of green loans 32,244 plug-
Slide 28: Appendix
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | Q1 2024 results | Frankfurt am Main, 13 May 2024 27
Slide 29: Q1 2024 results at a glance
Q1 2024 results at a glance In EUR m Q1-23 Q1-24 Y-o-Y Net interest income 75.4 90.1 14.6 Net fee and commission income 14.0 14.1 0.1 Other operating income (net) 4.3 3.0 -1.3 Operating income 93.7 107.2 13.4 Income Personnel expenses 27.6 32.2 4.6 statement Administrative expenses 28.3 33.9 5.6 Los
Slide 30: Overview of quarterly financial development
Overview of quarterly financial development In EUR m Q1-23 Q2-23 Q3-23 Q4-23 Q1-24 Net interest income 75.4 80.2 89.0 92.6 90.1 Net fee and commission income 14.0 14.9 14.4 14.3 14.1 Other operating income (net) 4.3 2.9 6.0 4.5 3.0 Operating income 93.7 98.0 109.4 111.4 107.2 Income Personnel expens
Slide 31: Balance sheet
Balance sheet in EUR m Dec-23 Mar-24 Assets Cash and central bank balances 2,348 2,179 Loans and advances to banks 372 494 Investment securities 751 814 Loans and advances to customers 6,226 6,414 Loss allowance for loans to customers -197 -197 Derivative financial assets 8 9 Property, plant and equ
Slide 32: Balance sheet development
Balance sheet development YTD asset development YTD liabilities and equity development (in EUR m) (in EUR m) ► Simple balance sheet structure with 63% of assets net loans to ► Liabilities and equity structure with 73% liabilities to customers, customers, 23% cash and cash equivalents and 14% other a
Slide 33: Appendix
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | Q1 2024 results | Frankfurt am Main, 13 May 2024 32
Slide 34: Structure of the loan portfolio by segment and currency
Structure of the loan portfolio by segment and currency Loan portfolio by segment Loan portfolio by currency 10% 3% 37% 29% 51% 58% 12% Medium Small Micro Private clients EUR USD Other Currencies ProCredit Group | Q1 2024 results | Frankfurt am Main, 13 May 2024 33
Slide 35: Development of green loan portfolio
Development of green loan portfolio Green loan portfolio growth ► Green loan portfolio amounting to EUR 1.3bn, representing 20.0% of total loan portfolio 15.4% 20.0% CAGR 2018-2023: 13% ► Includes financing of investments in: • Energy efficiency • Renewable energies 1,281 • Other environmentally-fri
Slide 36: Structure of collateral
Structure of collateral Collateral by type (FY 2023) ► Majority of collateral consists of mortgages ► Significant share of financial guarantees mainly as a result of InnovFin and other guarantee programmes provided by the European Investment Fund 1% 16% ► Clear, strict requirements for types of acce
Slide 37: Appendix
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | Q1 2024 results | Frankfurt am Main, 13 May 2024 36
Slide 38: Income statement by segment
Income statement by segment South Eastern 01.01.- 31.03.2024 (in EUR m) Germany Eastern Europe South America Consolidation Group Europe Interest and similar income 15.8 44.3 82.8 13.1 -10.9 145.1 of which inter-segment 6.4 2.4 2.1 0.0 0.0 0.0 Interest and similar expenses 15.0 18.8 23.5 8.7 -10.9 55
Slide 39: Segment South Eastern Europe
Segment South Eastern Europe Regional loan portfolio breakdown Key financial data Bosnia & Albania 6% Herzeg. 7% (in EUR m) Q1-23 Q1-24 Bulgaria 24% Net interest income 47.3 59.4 Romania 8% Net fee and commission income 8.7 9.0 North Other operating income (net) 2.2 2.7 Macedonia Greece via 11% Bulg
Slide 40: Segment Eastern Europe
Segment Eastern Europe Regional loan portfolio breakdown Key financial data Moldova 17% (in EUR m) Q1-23 Q1-24 Net interest income 22.3 25.5 Net fee and commission income 1.7 1.5 Ukraine 43% Other operating income (net) 2.3 2.2 Operating income 26.4 29.3 Personnel expenses 4.4 4.7 Georgia 40% Admini
Slide 41: Segment South America
Segment South America Regional loan portfolio breakdown Key financial data (in EUR m) Q1-23 Q1-24 Net interest income 5.4 4.4 Net fee and commission income 0.1 0.1 Other operating income (net) 0.0 0.4 Ecuador 100% Operating income 5.4 4.9 Personnel expenses 2.0 2.1 Admininistrative expenses 2.9 3.9
Slide 42: Key figures per ProCredit bank (as per Q1 2024)
Key figures per ProCredit bank (as per Q1 2024) North Bosnia & Country Bulgaria Serbia Kosovo Romania Macedonia Herzegovina Customer loan portfolio (EUR m) 1,583 916 806 522 392 314 Change in customer loan portfolio (%) 4.4% 0.9% 7.7% 2.8% 2.3% 5.3% Credit impaired loans (Stage 3) 1.1% 3.6% 1.1% 2.0
Slide 43: Key figures for ProCredit Bank Ukraine
Key figures for ProCredit Bank Ukraine Development since 2021, before Russian invasion in 2022 Quarterly KPI update (in EUR m) FY-21 FY-22 FY-23 Q4-23 Q1-24 Selected financial indicators Staff information Loan portfolio 757 582 497 Number of staff 334 346 % of group 12.8% 9.5% 8.0% Change qoq % 0.6%
Slide 44: Appendix
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | Q1 2024 results | Frankfurt am Main, 13 May 2024 43
Slide 45: Funding, rating and liquidity
Funding, rating and liquidity Funding sources Deposit-to-loan ratio development Rating 2% 2% 1% 12% Customer deposits 117% 116% BBB (stable) ProCredit Holding rating Liabilities to banks by Fitch, last affirmed on Debt securities 23 June 2023 Subordinated debt 83% Other liabilities Dec-23 Mar-24 Tot
Slide 46: Explanatory note on performance indicators and ratios
Explanatory note on performance indicators and ratios The ProCredit group uses an integrated system of indicators to monitor and The credit-impaired coverage ratio(8) gives insights into loss allowances for manage the implementation and further development of the group’s business credit-impaired l
Slide 47: Contact Investor Relations
Contact Investor Relations Financial calendar (continuously updated on IR Website) Date Location Event information 14.05.2024 – 15.05.2024 Frankfurt/ Main Spring Conference 2024 04.06.2024 Frankfurt/ Main Annual General Meeting 14.08.2024 Interim Report as of 30 June 2024 14.11.2024 Quarterly Financ
Slide 48: Disclaimer
Disclaimer The material in this presentation and further supporting documents have been This presentation and further supporting documents may contain forward- prepared by ProCredit Holding AG, Frankfurt am Main, Federal Republic of looking statements including statements regarding our intent, belie