Komercni Banka, A.s. · PSECZ:KOMB

Komercni Banka, A.s — Q3 2008 Earnings Presentation

35 slides from Komercni Banka, A.s's earnings presentation, Nov 7, 2008

  1. Slide 1: KB Group Financial Results as at 30 September 2008

    KB Group Financial Results as at 30 September 2008 (International Financial Reporting Standards) Prague 7 November 2008 KB 3Q 2008 results – Prague – 7 November 2008

  2. Slide 2: Disclaimer

    Disclaimer This document contains a number of forward-looking statements relating to the targets and strategies of the Komerční banka Group. These statements are based on a series of assumptions, both general and specific. As a result, there is a risk that these projections will not be met. Readers

  3. Slide 3: Agenda

    Agenda ƒ Business Highlights ƒ Consolidated Financial Results ƒ Loan Portfolio Quality and Development ƒ Appendix 3 KB 3Q 2008 results – Prague – 7 November 2008

  4. Slide 4: Highlights of the first three quarters of 2008

    Highlights of the first three quarters of 2008 Year on year comparisons Successful and strong development in spite of markets‘ turmoil ƒ Net banking income of KB Group rose 12.2% to CZK 24.4 billion ƒ Client deposits increased 8.5% to CZK 551.1 billion. Net loans-to-deposits ratio reached 64.4%, mak

  5. Slide 5: Business initiatives in 3rd quarter of 2008

    Business initiatives in 3rd quarter of 2008 Continuing introduction of innovations for all segments ƒ Mojebanka and Express line Plus innovations – on-line conclusion and administration of building savings contracts, business loans, mortgages or insurance and pension scheme policies ƒ KB Guaranteed

  6. Slide 6: Business achievements in 3rd quarter of 2008 – Individuals

    Business achievements in 3rd quarter of 2008 – Individuals Year on year comparisons Continued good commercial momentum ƒ Number of KB‘s individual clients continued increasing, by 4% to 1,334,000. Student accounts up 13% to 171,000 ƒ Volume of newly sold mortgages to individuals increased year-on-ye

  7. Slide 7: Business achievements and initiatives in 3rd quarter of 2008 – Corporations

    Business achievements and initiatives in 3rd quarter of 2008 – Corporations Year on year comparisons Very good resilience of activity ƒ Overall lending to business clients expanded by 20% to exceed 208.3 billion ƒ Strong growth (41%) of lending to small business clients thanks to improvements of pro

  8. Slide 8: Group deposits increased 8.5% year-on-year

    Group deposits CZK billion By Customers 551.1 Group deposits increased 8.5% 506.9 508.0 540.2 539.5 532.5 year-on-year 64.1 63.7 63.8 63.9 59.5 59.9 145.7 146.6 147.3 151.8 143.9 146.1 ƒ QoQ group deposits rose 3.5% 20.8 21.6 22.7 23.3 24.4 25.0 ƒ KB represents 83% of CZK 551.1 billion of total 278.

  9. Slide 9: Total lending expanded by 21.6% year-on-year

    Group lending activities Total lending expanded by 21.6% CZK billion 364.3 350.7 year-on-year 314.5 328.6 37.5 283.3 299.5 35.9 33.0 34.3 29.8 82.3 86.5 27.7 75.0 78.0 Business loans grew by 19.7% YoY: 68.8 64.7 27.2 28.4 24.5 25.6 ƒ Small businesses (KB) +40.7% to CZK 19.2 21.1 22.5 billion 186.3 2

  10. Slide 10: Agenda

    Agenda ƒ Business Highlights ƒ Consolidated Financial Results ƒ Loan Portfolio Quality and Development ƒ Appendix 10 KB 3Q 2008 results – Prague – 7 November 2008

  11. Slide 11: Consolidated financial results: Profit and Loss Statement

    Consolidated financial results Profit and Loss Statement Change 1-3Q 2007 1-3Q 2008 YoY (CZK million, unaudited) Net interest income 13,811 15,586 12.9% Net fees & commissions 5,732 6,048 5.5% Income from financial operations 2,141 2,679 25.1% Other income 102 132 29.4% Net banking income 21,787 24,

  12. Slide 12: Consolidated financial results: Balance Sheet

    Consolidated financial results Balance Sheet 30 Sep 30 Sep Change (CZK million, unaudited) 2007 2008 YoY Assets 646,162 688,330 6.5% Cash and balances with central bank 16,446 8,793 -46.5% Amounts due from banks 213,996 167,530 -21.7% Loans and advances to customers (net) 290,455 355,084 22.3% Secur

  13. Slide 13: Key ratios and indicators

    Consolidated financial ratios 30 Sep 30 Sep Change Key ratios and indicators 2007 2008 YoY Capital Adequacy (Basel II) n.a. 12.50% n.a. Capital Adequacy (Basel I) 10.80% 10.00% T Tier 1 Ratio (Basel II) n.a. 11.13% n.a. Tier 1 Ratio (Basel I) 9.50% 8.93% T Risk weighted assets for credit risk (CZK b

  14. Slide 14: Net interest income

    Net interest income Higher income benefiting from rising volumes 5,236 5,276 ƒ YoY increase in NII of 12.9%. QoQ NII rose 0.8% 4,979 5,074 4,666 4,788 610 478 435 457 ƒ MPSS NII (before adjustments) up 38%. ESSOX NII 456 392 1,667 1,748 1,832 up 23% YoY. Standalone KB NII rose 10% YoY 1,586 1,647 1,

  15. Slide 15: Net fees and commissions

    Net fees and commissions Solid fee income overall, cross-selling of mutual funds hit by turmoil 2,025 2,105 ƒ YoY growth of 5.5%, QoQ decline due to largest part of 1,939 1,920 1,954 1,989 153 158 inter-bank settlement of interchange fees on card 152 160 156 160 transactions booked in 2Q. (1-3Q CZK

  16. Slide 16: Net profit from financial operations

    Net profit from financial operations Trading income growth driven by client business 956 958 841 ƒ Net profit from financial operations increased by 790 766 632 25.1% YoY. QoQ slight decrease of 0.2% 636 538 521 583 583 441 ƒ Income from FX payments and conversions YoY 136 539 slightly up (1.3%) wit

  17. Slide 17: Operating costs

    Operating costs Increase in operating expenses slowed down in the second quarter 2Q 2007 3Q 2007 4Q 2007 1Q 2008 2Q 2008 3Q 2008 ƒ YoY growth of 6.6%, QoQ operating expenses dropped by 5.0% -1,500 -1,494 -1,480 -1,495 -1,558 -1,602 ƒ Personnel costs rising with increase in average headcount (+3.4%)

  18. Slide 18: Shareholders' equity

    Shareholders‘ equity Total shareholders‘ equity Total shareholders‘ equity +6,941 as at 31 December 2007 as at 30 September 2008 Shareholders' equity 31/12/2007 1/1/2008 Increase Decrease 30/09/2008 Share capital 19,005 19,005 19,005 Capital and reserve funds 20,802 31,990 -6,796 25,194 - Retained e

  19. Slide 19: Agenda

    Agenda ƒ Business Highlights ƒ Consolidated Financial Results ƒ Loan Portfolio Quality and Development ƒ Appendix 19 KB 3Q 2008 results – Prague – 7 November 2008

  20. Slide 20: Loan quality

    Loan quality Loan quality assessed as stable in a more challenging market environment CZK billion 350.7 364.3 Gross exposure 314.5 328.6 299.5 283.3 ƒ 3.9% (+CZK 13.6 billion) QoQ growth of loan portfolio, ie at slower pace than previous quarters (6.7% for Q2 2008 and 5.7% for Q3 2007) 324.2 335.5 2

  21. Slide 21: Cost of risk

    Cost of risk Rising cost of risk driven by corporate loan exposures 2Q 2007 3Q 2007 4Q 2007 1Q 2008 2Q 2008 3Q 2008 39 39 ƒ QoQ provisions for loan losses up from CZK 445 millions 37 37 37 35 to CZK 643 million 200 75 15 12 ƒ YtD provisions for loan losses higher by 37% compared -372 -359 to the sam

  22. Slide 22: Agenda

    Agenda ƒ Business Highlights ƒ Consolidated Financial Results ƒ Loan Portfolio Quality and Development ƒ Appendix 22 KB 3Q 2008 results – Prague – 7 November 2008

  23. Slide 23: Number of clients and distribution network

    Number of clients and distribution network Dynamic growth of KB's portfolio and networks Clients of KB (bank) ƒ Clients ƒ KB bank 1,619,000 clients (+4%) ƒ MPSS 748,000 clients (-3.5%) ƒ PFKB 486,000 clients (+7%) 1,577 1,619 1,467 1,515 1,331 1,407 ƒ ESSOX 196,000 active clients (+18%) ƒ Network ƒ

  24. Slide 24: Business performance of subsidiaries 1/2

    Business performance of subsidiaries 1/2 1-3Q 2007 1-3Q 2008 Change YoY MPSS Volume of new loans (CZK million) 9,700 8,159 -16% Volume of total loans (gross, CZK million) 29,808 37,500 26% Target volume of new contracts (CZK million) 23,502 26,638 13% Volume of deposits (CZK million) 59,886 64,094 7

  25. Slide 25: Business performance of subsidiaries 2/2

    Business performance of subsidiaries 2/2 1-3Q 2007 1-3Q 2008 Change YoY Factoring Factoring turnover (CZK million) 13,056 12,225 -6% KB New contracts (number) 165 139 -16% Number of FTEs 44 42 -6% KBB Total client loans (gross, CZK milion) 3,775 5,283 40% Total client deposits (CZK milion) 3,527 2,1

  26. Slide 26: Standalone results of KB group companies and associated undertakings

    Standalone results of KB group companies and associated undertakings Account. Share of Net YoY Equity YoY Assets YoY standards KB Profit CZK million KB IFRS n.a. 8,741 19.5% 54,313 16.4% 602,181 5.9% ESSOX, s.r.o. IFRS 51% 131 263.9% 2,292 88.0% 8,510 39.6% Factoring KB, a.s. CAS 100% 44 131.6% 1,48

  27. Slide 27: KB consolidated group

    KB consolidated group Pension Penzijní fond KB Fourth largest pension fund in the Czech Republic offering pension insurance to insurance (100%) almost 486 thousand clients. Modrá pyramida Building Third largest building society with 748,000 clients offering state-subsidised stavební society building

  28. Slide 28: Quarterly financial results: Profit and Loss Statement

    Quarterly financial results Profit and Loss Statement Change 3Q 2007 3Q 2008 YoY (CZK million, unaudited) Net interest income 4,788 5,276 10.2% Net fees & commissions 1,920 1,989 3.6% Income from financial operations 636 956 50.3% Other income 33 46 39.4% Net banking income 7,378 8,267 12.0% Personn

  29. Slide 29: Revaluation of MPSS balance sheet

    Revaluation of MPSS balance sheet Background ► Remaining 60% in Modrá pyramida acquired in October 2006. Full consolidation of MPSS since 4Q 2006 ► Preliminary goodwill on acquisition of Modrá pyramida at CZK 2,741 mil. ► In accordance with IFRS 3 A&L valuation to be completed within 12 months after

  30. Slide 30: Recurring profit: Pro-forma Profit and Loss without one-offs

    Recurring profit Pro-forma Profit and Loss without one-offs 1-3Q 1-3Q Change 2007 2008 YoY +21.9% Net banking income 21,463 24,047 12.0% Net interest income 13,516 15,365 13.7% Non-interest income 7,947 8,682 9.2% Operating costs -10,084 -10,687 6.0% 9,553 Personnel expenses -4,434 -4,655 5.0% 7,835

  31. Slide 31: Macroeconomic environment: Czech Republic

    Macroeconomic environment Czech Republic Macroeconomic Indicators 2005 2006 2007 2008* 2009* Real GDP (%) 6.3 6.8 6.6 4.3 3.8 Inflation (%) 1.9 2.5 2.8 6.6 3.5 Household income (%) 4.2 6.7 7.9 5.9 6.5 M2 (%) 8.0 9.9 13.2 14.0 13.5 3M PRIBOR (%, average) 2.0 2.3 3.1 4.0 4.0 Potential of the market 20

  32. Slide 32: Interest rates evolution

    Interest rates evolution (for the period 28 December 2001 – 31 October 2008) 5.0% 4.5% 4.0% 3.5% 3.0% 2.5% 2.0% 1.5% 28/12/2001 28/12/2002 28/12/2003 28/12/2004 28/12/2005 28/12/2006 28/12/2007 Pribor 3M Pribor 6M KB Reference Rate ČNB REPO Rate 32 KB 3Q 2008 results – Prague – 7 November 2008

  33. Slide 33: Development of KB's share price and PX Index

    Development of KB‘s share price and PX Index (for the period 1 October 2001 – 31 October 2008) 4,800 2,100 4,300 1,900 1,700 3,800 1,500 3,300 1,300 2,800 1,100 2,300 900 1,800 700 1,300 500 800 300 01/10/2001 01/10/2002 01/10/2003 01/10/2004 01/10/2005 01/10/2006 01/10/2007 01/10/2008 KB (left scal

  34. Slide 34: KB shareholders

    KB shareholders As at 30 September 2008 According to excerpt from the Securities centre Others 39.6% Société Générale 60.4% 34 KB 3Q 2008 results – Prague – 7 November 2008

  35. Slide 35: Investor Relations

    Investor Relations Jakub Černý, Olga Nevyhoštěná, Renáta Buchtová Tel.: +420 955 532 155, 955 532 734, 955 532 156 E-mail: investor_relations@kb.cz - Internet: www.kb.cz 35 KB 3Q 2008 results – Prague – 7 November 2008

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