Brd Groupe Societe Generale Sa (romania) · BVB:BRD
Brd Groupe Societe Generale Sa (romania) — BRD - Groupe Société Générale — Q1 2018 Earnings Presentation
29 slides from Brd Groupe Societe Generale Sa (romania)'s earnings presentation, May 2018
Slide 1: BRD Group Results 1st Quarter 2018
BRD - GROUP R E S U LT S 1 ST Q U AR T E R 2 0 1 8 MAY 2018
Slide 2: Disclaimer
DISCLAIMER The consolidated and separate financial position and income statement for the period ended March 31, 2018 were examined by the Board of Directors on May 3, 2018. The financial information presented for the period ended March 31, 2018 and comparative periods has been prepared according to
Slide 3: Introduction
INTRODUCTION BRD
Slide 4: Q1 2018: Net Profit of RON 414M
Q1 2018: NET PROFIT OF RON 414M Broad-based revenue growth on solid volume increase and rising interest rates Accelerating net interest income (+14.2% y/y), on growing volumes and favorable NBI interest rates trend RON 724m +11.4% vs Q1-2017 Rise in net loans (+5.0%* y/y) and deposits (+6.0%* y/y) H
Slide 5: Macroeconomic & Banking Environment
2 MACROECONOMIC & BANKING ENVIRONMENT
Slide 6: Favorable Macroeconomic Environment
FAVORABLE MACROECONOMIC ENVIRONMENT GDP GROWTH Supportive macroeconomic context 6.9% 2017 GDP accelerated significantly at +6.9% y/y, driven by household consumption 5.1% 4.8% GDP growth expected to slow down to more sustainable levels in 4.0% 2018, on decelerating private consumption due to the fad
Slide 7: Steady Loan Growth, Strong Deposit Inflows
STEADY LOAN GROWTH, STRONG DEPOSIT INFLOWS ROMANIAN BANKING SYSTEM LOANS (RON bn) Domestic loan market growth driven by retail demand yoy* Continuous double-digit increase in housing loans (+12.2%* y/y), 236 245 247 +3.5% supported by the “Prima Casa” product Modest consumer loan growth (+1.3%* y/y)
Slide 8: Improving Asset Quality Pushing ROE Up, Solid Liquidity and Capital Positions
IMPROVING ASSET QUALITY PUSHING ROE UP, SOLID LIQUIDITY AND CAPITAL POSITIONS ROMANIAN BANKING SYSTEM NPL RATIO NPL ratio further declining… …as a result of write off operations and sale of defaulted loans 20.7% portfolios NPL ratio at 6.2% at Feb 2018 end, compared to 20.7% at 2014 end 13.6% 9.5% 6
Slide 9: 1st Quarter BRD Group Results
3 1ST QUARTER BRD GROUP RESULTS
Slide 10: Expanding Customer Base and Further Focus on Digital Channels
EXPANDING CUSTOMER BASE AND FURTHER FOCUS ON DIGITAL CHANNELS Client growth maintains momentum AVERAGE INDIVIDUAL CUSTOMER 2.32m active clients EQUIPMENT RATE Stock of active clients increased by + 37,000 y/y 4.18 4.16 4.09 Individuals 2.18m clients +33,000 y/y Small business 116k clients +4,000 y/y
Slide 11: Further Loan Growth, Mainly Fueled by Dynamic Household Demand
FURTHER LOAN GROWTH, MAINLY FUELED BY DYNAMIC HOUSEHOLD DEMAND LOANS TO INDIVIDUALS PRODUCTION (RON m) Robust advance of net retail loan portfolio: +7.2%* y/y Q1-18 vs. Consolidated leadership position on individual customers Q1-17 1,763 1,837 segment, with a market share of 16.9% at March 2018 end
Slide 12: Larger Deposit Inflows and Rising Assets Under Management
LARGER DEPOSIT INFLOWS AND RISING ASSETS UNDER MANAGEMENT DEPOSITS (outstanding amounts, RON bn) Strong deposit inflows y/y on both Retail and Non retail yoy* ytd* customers 41.4 44.2 44.3 +6.0% +0.3% Retail savings +7.4% y/y vs March 2017 end 16.4 15.9 +3.6% -2.7% 15.3 Non retail deposits +3.6% y/y
Slide 13: Strong and Broad-Based Revenue Growth
STRONG AND BROAD-BASED REVENUE GROWTH NET BANKING INCOME (RONm) Solid revenue growth YoY 724 +11.4% NBI accelerated by +11.4% in Q1 2018, posting increases on all 650 categories 75 +10.8% Other income 67 184 +5.2% Net fee and 175 commissions Double-digit net interest income growth (+14.2%) Positive
Slide 14: Stable Cost Base
STABLE COST BASE OPERATING EXPENSES (RON m) YoY Quasi-stable operating expenses… 384 385 +0.2% Contributions to 35 -50.5% 71 Staff expenses up, due to adjustment of compensation packages FGDB & FR in a tight labor market context 186 +11.3% Staff expenses 167 Rising other expenses on higher IT and co
Slide 15: Improved Asset Quality
IMPROVED ASSET QUALITY GROSS LOANS – March 31, 2018 breakdown by segment and currency (RON bn) Loan portfolio market mix 65.6% on individuals market segment 34.4% on legal entities market segment 20.7 19.4 Consolidation of RON lending Share of RON denominated loans at 61.6% (vs 57.8% as of 03/2017)
Slide 16: Negative Cost of Risk
NEGATIVE COST OF RISK COST OF RISK EVOLUTION (RON m) Net cost of risk at -191 bps as a joint result of: • Strong recovery performance (~80 MRON), mostly on Legal Entities • Extraordinary insurance indemnity related to previous losses (~65 MRON) Note: Cost of risk in bps for Q1-2017 and Q1-2018 is an
Slide 17: Strong Profitability on Robust Revenue Generation and Positive Cost of Risk
STRONG PROFITABILITY ON ROBUST REVENUE GENERATION AND POSITIVE COST OF RISK NET PROFIT (RON m) 414 +25.6% incl. non recurring items Net profit up +26% y/y in Q1 2018 55 Supported by healthy revenue generation all across the 330 board, stable costs and improved asset quality Non-recurring Net profit
Slide 18: Solid Capital Position
SOLID CAPITAL POSITION SOLVENCY RATIO -24bp +89bp -58bp -78bp +7bp Solid Tier 1 capital base CAR at 19.3% at March 2018, comfortably above regulatory requirement. 19.91% 19.27% Retained IFRS 9 Mar-17 OCI RWA Other Mar-18 profit* impact * Retained profit is net of 2017 dividends, approved in April 20
Slide 19: Conclusions
CONCLUSIONS BRD
Slide 20: Conclusions
CONCLUSIONS Strong and broad-based revenue growth, on rising loans, deposits and number of transactions Steady loan growth sustained by retail and large corporate segments Continued deposit inflows and further increase of assets under management Ongoing focus on business model development an
Slide 21: Q&A Session
Q&A SESSION BRD
Slide 22: Appendix
APPENDIX BRD
Slide 23: BRD Group | Key Figures
BRD GROUP | KEY FIGURES RON m Q1-2018 Q1-2017 Change Net banking income 724 650 +11.4% Operating expenses (385) (384) +0.2% Gross operating income 339 266 +27.5% Reported financial results Net cost of risk 153 124 +23.4% Net profit 414 330 +25.6% Cost/Income 53.2% 59.1% -5.9 pt ROE 22.0% 19.3% +2.7
Slide 24: BRD Group | Key Figures
BRD GROUP | KEY FIGURES Loans and deposits RON bn Mar-17 Mar-18 Change (1) 28.7 30.4 +5.0% Net loans including leasing (RON bn) Retail 19.4 21.0 +7.2% Non retail 9.3 9.4 +0.5% (1) 41.4 44.3 +6.0% Total deposits (RON bn) Retail 26.2 28.4 +7.4% Non retail 15.3 15.9 +3.6% Loan to deposit ratio 69.2% 68
Slide 25: BRD | Key Figures for Bank Only
BRD | KEY FIGURES FOR BANK ONLY RON m Q1-2018 Q1-2017 Change Net banking income 680 601 +13.2% Financial results Operating expenses (364) (365) -0.5% Gross operating income 317 236 +34.5% Net cost of risk 150 130 +15.7% Net profit 392 307 +27.8% Cost/Income 53.4% 60.8% -7.4 pt ROE 21.9% 18.9% +3.0 p
Slide 26: BRD | Stock Price Performance
BRD | STOCK PRICE PERFORMANCE Market capitalisation 4,000 EUR 2.3 bn 16.0 3,500 3,000 14.0 2,500 12.0 2,000 10.0 1,500 1,000 8.0 500 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 27: Financial Calendar for 2018
FINANCIAL CALENDAR FOR 2018 8th February: Preliminary 2017 financial results and annual press conference 19th April: General Shareholders Meeting 19th April: General Assembly of Shareholders and publication of the 2017 BoD Report 4th May: Q1-2018 results publication 2nd August: H1-2018 res
Slide 28: 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 transfe
Slide 29: BRD Groupe Societe Generale - Investor Relations
BRD GROUPE SOCIETE GENERALE - INVESTOR RELATIONS +4 021 380 47 62 investor@brd.ro www.brd.ro
BRD - Groupe Société Générale — Q1 2018 Earnings Presentation on 6ix