Eurobank S.A. · ATHEX:EUROB
Eurobank — Eurobank EFG — 9M 2009 Earnings Presentation
34 slides from Eurobank's earnings presentation, Nov 24, 2009
Slide 1: Nine Month 2009 Results
SW-EUB022-2007-03-19-CMD-V7 November 24, 2009 Nine Month 2009 Results
Slide 2: Macro environment
Page 2 Macro environment Greece New Europe New government determined to Strong GDP rebound expected in implement necessary structural 2010 across countries: roughly +2% reforms Inflation is on a downward trend GDP growth for 2009 above EU average but public deficit a concern Strong competi
Slide 3: Results highlights
Page 3 Results highlights 3Q 09 net profit reached € 111m up 27%qoq Highest ever pre-provision profit at € 414m NII up 1.5% qoq; down only 2.5% yoy Costs down 6.6% yoy – the best performance in the sector Positive asset quality trends with 90dpd loan formation down by 37%qoq Common equit
Slide 4: Loan growth picking up in line with deposits increase
Loan growth picking up in line with Page 4 deposits increase 3Q 09 gross loans additions 3Q 09 additions per country +2.6bn +0.8bn -0.8bn +0.1bn +0.3bn Deposits Loans Greece 345 280 A-rated Poland 212 231 countries Cyprus 54 57 1,369 Romania 115* -140 1,244 1,152 Bulgaria 49 -63 Serbia 8 14 Turkey 1
Slide 5: Improving trends in impaired loans
Page 5 Improving trends in impaired loans 90dpd formation drops by 37% Loans 90dpd +50bps +100bps +100bps 6.40% 5.90% 787 4.93% -37% Group 90 dpd 3.90% 713 3.43% Greece 3.83% 4.20% 4.91% 5.77% 6.18% New Europe 2.34% 3.04% 5.02% 6.32% 7.08% 3Q 08 4Q 08 1Q 09 2Q 09 3Q 09 508 492 452 464 LLP stabilize
Slide 6: Encouraging trends in New Europe countries
Encouraging trends in New Europe Page 6 countries 10.8% 9.0% 7.6% 6.6% 5.8% 6.9% 3.2% 4.1% 1.8% 2.2% 2.6% 2.6% 90+ over av. 1.2% 1.1% 1.3% loan book 129 105 71 64 54 60 32 32 39 34 16 14 19 19 Gross 90+ 7 formation 3Q08 4Q08 1Q09 2Q09 3Q09 3Q08 4Q08 1Q09 2Q09 3Q09 3Q08 4Q08 1Q09 2Q09 3Q09 Poland Rom
Slide 7: Adequate provision coverage
Page 7 Adequate provision coverage 90dpd provision coverage: 46% 3,642 NPL provision coverage: 60% Consumer 1,038 Lending 2,789 90dpd NPLs Value of Total NPL NPL provisions provisions collaterals coverage recovery coverage coverage rates Mortgages 495 1,038 Consumer 1,663 >75% >75% ~5% >80% 35% Lend
Slide 8: Strong liquidity position
Page 8 Strong liquidity position L/D ratio sustained at low levels Wholesale funding maturities profile Maturities for 2010 imply only modest 3,262 refinancing requirements 2,800 2,816 Readily available liquid funds >€ 6bn ECB funding at less than € 6bn 1,928 1,329 Loans-to-deposits ratio ev
Slide 9: Strong organic capital position improvement
Strong organic capital position Page 9 improvement Common equity movement +880m 4,467 Capital Adequacy (%) FY 08 1Q 09* 1H 09 9M 09 144 Equity Tier I ratio 7.1% 7.4% 8.0% 8.8% (Core Tier 1 less goodwill) €3.6bn €3.8bn €4.2bn 456 Core Tier I ratio 8.0% 8.6% 9.2% 10.0% €4.2bn €4.3bn €4.8bn Total Tier
Slide 10: Financial Review
Page 10 (G) Eurobank EFG Financial Review
Slide 11: Pre-provision profit expands steadily
Page 11 Pre-provision profit expands steadily Quarterly pre-provision profit Operating income at € 777m, up 4%qoq 411 410 414 409 Operating expenses flat qoq, down 7%yoy. 389 363 Pre-provision profit up € 25m 321* +6.4% qoq Pre-provision profit on course to exceed last year’s 1Q 08 2Q 08 3Q
Slide 12: Loan NII again at record highs – deposit margin improves gradually
Loan NII again at record highs – deposit Page 12 margin improves gradually NII quarterly evolution NII marginally down yoy 621 608 590 590 599 560 566 544 -2.5% 517 482 600 1,777 564 580 1,733 Total NII 445 497 457 404 417 382 342 352 322 Loan margin 11 13 17 3 4 5 Interest rate 10 7 gapping -13 -7
Slide 13: Strong rebound in loan & deposit NII
Page 13 Strong rebound in loan & deposit NII Banking intermediation NII +31 +26 +6.1% 537 -8 +5.1% 538 -1.4% 529 +25 +15 +5.3% 512 +2.9% 506 Other NII -42 491 -8.1% 487 Loans & deposits NII 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09 3Q 09 € m. 13
Slide 14: Steady spreads in loans, better spreads in deposits & New Europe
Page 14 Steady spreads in loans, better spreads in deposits & New Europe Evolution of Greek spreads (%) New Europe NIM 4Q 08 1Q 09 2Q 09 3Q 09 NIM per country (%) FY 08 1Q 09 1H 09 9M 09 Sight & Savings Accounts 1.68 -0.06 -0.24 -0.46 Romania 4.73 4.53 4.23 4.48 Time & Client EMTNs -0.41 -1.02 -0.90
Slide 15: Commission income picking up
Page 15 Commission income picking up Solid performance in a seasonally weak quarter, up 8%yoy Fees from lending activities gained significantly 20% qoq Fees from capital markets sustain momentum 168 176 155 130 119 120 113 Lending Activities 60 81 64 44 53 Network & Other Activities 42 42 27 2
Slide 16: Costs reduction exceeds target of -5%
Page 16 Costs reduction exceeds target of -5% Cost evolution Sharp cost deceleration (yoy%) -7% 27.5 Group 24.4 0% 22.4 Greece 20.7 15.7 401 401 11.3 389 8.6 7.9 375 27 362 363 364 4.8 29 45 3.1 Depr. 33 33 36 35 -3.4 -6.1 -4.0 159 144 -5.8 -6.7 -6.6 Admin. 140 161 133 132 133 FY 07 1Q 08 1H 08 9M 0
Slide 17: Greece surging upwards
Page 17 Greece surging upwards Efficiency ratio on an improving trend… Greek pre-provision profits grow 10,300 10,200 10,150 10,000 10,300 334 10,220 10,150 312 318 10,000 298 296 279 Employees – period end 232* 43.1 42.6 41.4 41.8 40.0 40.2 41.3 40.2 Cost / Income (%) 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09
Slide 18: New Europe pre-provision profit and bottom line improve
New Europe pre-provision profit and Page 18 bottom line improve New Europe C/I ratio at historic lows New Europe’s pre-provision profit resilient Employees – period end 14,500 14,400 112 82.4 14,200 13,900 97 93 96 13,500 13,600 90 77.4 84 13,100 77 75.8 Cost / Income (%) 11,800 11,600 66.2 65.0 64.
Slide 19: Summary performance overview
Page 19 Summary performance overview Reversal of asset quality trends Record pre-provision profit 414 410 90dpd formation 787 389 713 363 321 508 452 301 3Q 08 4Q 08 1Q 09 2Q 09 3Q 09 3Q 08 4Q 08 1Q 09 2Q 09 3Q 09 € m. € m. Profitability on the rise Strong and improving capital position CAD 10.1% 10
Slide 20: Segmental Performance
Page 20 Segmental Performance 20
Slide 21: 3Q 09 PBT after minorities grow 10%qoq
Page 21 3Q 09 PBT after minorities grow 10%qoq accelerating from previous quarter’s 7% PBT* per Segment Group PBT* Share of profits 10.3% 78.8% 3.9% 25.4% -33.2% +10.4% 113 +6.3% 245 102 96 9M 09 79 32 12 -103 Retail Corporate Wealth Global & Capital New Europe 1Q 09 2Q 09 3Q 09 Management Markets F
Slide 22: Retail Segment
Page 22 Retail Segment Quarterly PBT evolution (€ m) 104 90 84 3Q 09/2Q 09 growth 5% -3% +14% -14% 28 9 12 10 307 322 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09 3Q 09 174 FY 08 9M 09 143 138 153 – Cost to Income 46.2% 45.2% – Return on Equity 29.7% 4.5% – Return on RwA 2.74% 0.42% 12 10 – Share of profits
Slide 23: Corporate Segment
Page 23 Corporate Segment Quarterly PBT evolution (€ m) 83 84 78 63 64 65 66 3Q 09/2Q 09 3% 16% -10% 1% growth 126 129 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09 3Q 09 83 84 FY 08 9M 09 – Cost to Income 28.8% 23.7% – Return on Equity 23.4% 26.7% 28 32 – Return on RwA 1.66% 2.05% 15 13 – Share of profits 32
Slide 24: Wealth Management Segment
Page 24 Wealth Management Segment Quarterly PBT evolution (€ m) 25 14 3Q 09/2Q 09 9 growth 24% 1% 133% 7 3 3 0 22 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09 3Q 09 18 15 15 FY 08 9M 09 – Cost to Income 56.4% 78.1% – Return on Equity 35.9% 11.9% 7 – Share of profits 6.1% 3.9% 3 Revenues Expenses Profits 2Q 0
Slide 25: Global & Capital Markets Segment
Page 25 Global & Capital Markets Segment Quarterly PBT evolution (€ m) 53 56 45 32 3Q 09/2Q 09 26 25 growth 14% 5% 26% 22 50 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09 3Q 09 44 32 FY 08 9M 09 25 – Cost to Income 29.8% 39.0% 17 18 – Return on Equity 42.3% 24.7% – Share of profits 22.7% 25.4% Revenues Expens
Slide 26: New Europe Segment
Page 26 New Europe Segment Quarterly PBT evolution (€ m) 45 37 23 3Q 09/2Q 09 2% 1% -3% N/A growth -18 -32 235 240 -37 -34 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09 3Q 09 157 158 119 115 FY 08 9M 09 – Cost to Income 68.4% 67.5% – Return on RwA 0.75% -0.99% – Share of profits 11.1% -33.2% (5) -37 -34 Reven
Slide 27: Appendices
Page 27 Appendices 27
Slide 28: Financial Ratios
Page 28 Financial Ratios Financial Ratios 9M 09 9M 08 Net Interest Margin 2.78% 3.21% Cost-Income 48.29% 48.66% NPLs (% of loans) 4.90% 2.66% NPLs coverage 60% 78% Provision Charge (% of net loans) 2.05% 1.09% Tier Ι Ratio 11.5% 7.9% Total Capital Adequacy* 12.7% 10.1% ROA after tax 0.46% 1.21% ROE
Slide 29: Summary Figures
Page 29 Summary Figures Summary Figures (€ m) 9M 09 9M 08 Δ% New Europe Net Interest Income 1,732.9 1,777.1 -2.5% 581.2 Net fees & Commissions 305.9 446.9 -31.5% 116.3 Insurance and Non banking fees 57.9 52.8 9.6% 4.5 Total Operating Income 2,253.0 2,395.1 -5.9% 721.4 Operating Expenses 1,088.0 1,16
Slide 30: Key figures of New Europe operations
Page 30 Key figures of New Europe operations Romania Bulgaria Serbia Cyprus Poland Turkey Ukraine NE Δ% Total Assets 5,525 4,095 1,763 1,718 5,044 2,087 759 21,006 -1.4% Balance Sheet Total Loans 3,539 3,095 1,081 569 4,281 1,046 649 14,261 -5.3% Total Deposits 1,979 1,877 722 1,490 2,558 768 251 9,
Slide 31: Key regional macroeconomic data
Page 31 Key regional macroeconomic data GDP growth (%) HICP (%)** Public Debt / GDP Current Account / Unemployment (%) (%) (S95)*** GDP (%) 2009e 2010f 2009e 2010f 2009e 2010f 2009e 2010f 2009e 2010f EU-27 (4.1) 0.7 1.0 1.3 73.0 79.3 (0.8) (0.6) 9.1 10.3 Greece (1.1) (0.3) 1.2 1.4 112.6 124.9 (8.8)
Slide 32: 9M 2009 – Summary per Segment
Page 32 9M 2009 – Summary per Segment Segmental Results 9M 09 Wealth Global & Capital Capital & Elimination Total (€ m) Retail Corporate Management Markets Other Center New Europe Interest income 825.3 307.1 -1.0 40.6 -3.2 0 564.1 1,732.9 Net fee & commission income 36.2 36.8 34.4 83.7 -1.45 0 116.3
Slide 33: 9M 2008 – Summary per Segment
Page 33 9M 2008 – Summary per Segment Segmental Results 9M 08 Wealth Global & Capital Capital & Elimination Total (€ m) Retail Corporate Management Markets Other Center New Europe Interest income 903 227 18 72 24 0 533 1,777 Net fee & commission income 41 32 59 112 -1 0 204 447 Net Insurance income
Slide 34: Contacts
Page 34 Contacts EFG Eurobank Ergasias, 20 Amalias Avenue, 105 57 Athens, Greece Fax: +30 210 3337 160 E-mail: investor_relations@eurobank.gr Internet: www.eurobank.gr Reuters: EFGr.AT Bloomberg: EUROB GA Investor Relations Dimitris Nikolos Tel: +30 210 3337688 E-mail: dnikolos@eurobank.gr Yanni