Intercorp Financial Services Inc. · NYSE:IFS
Intercorp Financial Services — Q3 2014 Earnings Presentation
39 slides from Intercorp Financial Services's earnings presentation, November 2014
Slide 1: Third Quarter 2014 Earnings Presentation
Third Quarter 2014 Earnings Presentation
Slide 2: Agenda
Agenda 1 Overview of today’s call 2 3Q14 results under IFRS and local GAAP 3 Appendix 2
Slide 3: Agenda
Agenda 1 Overview of today’s call 2 3Q14 results under IFRS and local GAAP 3 Appendix 3
Slide 4: Overview of today's call
Overview of today’s call We are presenting IFS’ financial results under IFRS, for the first time We have prepared for the first time financial statements in accordance to IFRS as issued by the IASB. IFS had previously prepared consolidated financial statements in accordance with accounting princ
Slide 5: First time adoption of IFRS – Main changes for IFS
First time adoption of IFRS – Main changes for IFS The transition to IFRS for IFS required both the reclassification and re-measurement of certain accounts; below a summary for the main changes: Under SBS GAAP Under IFRS Effects going forward Provisions are calculated according to regulatory P
Slide 6: Overview of IFS and Inteligo transaction
Overview of IFS and Inteligo transaction Transaction description Transaction was reviewed and recommended by an independent 19.5 million shares committee of IFS’ Board and supported by a fairness opinion Float from PwC. It was approved by IFS’ Board of Directors on July 31% 18th, 2014 and closed on
Slide 7: Key financials – Inteligo Group
Key financials – Inteligo Group Inteligo Group key financials S/. million 6M13 6M14 %chg 9M13 9M14 %chg 2013 AuM + Deposits 9,040.6 9,635.3 6.6% 9,021.8 10,830.1 20.0% 9,260.8 Total Assets 2,708.3 2,604.2 -3.8% 2,863.7 2,803.4 -2.1% 2,635.8 (1) Shareholder's equity 406.5 426.3 4.9% 421.2 456.5 8.4%
Slide 8: Agenda
Agenda 1 Overview of today’s call 2 3Q14 results under IFRS and local GAAP 3 Appendix 8
Slide 9: Highlights 3Q14
Highlights 3Q14 IFRS 3Q14 net profit was S/. 275.0 million, a 19.7% increase YoY and a 2.3% decrease QoQ Intercorp The quarterly decrease in net profit was mainly driven by lower other income in 3Q14 when compared to Financial a strong result in 2Q14 in Interseguro and Inteligo, while the YoY in
Slide 10: IFS key indicators 3Q14
IFS key indicators 3Q14 IFRS Intercorp Financial Services' key indicators S/. million 3Q13 2Q14 3Q14 %chg QoQ %chg YoY Net interest and similar income 456.0 492.1 515.7 4.8% 13.1% Results Fee income from financial services, net 150.1 176.6 171.0 -3.2% 13.9% Profit for the period 229.7 281.6 275.0 -2
Slide 11: IFS 3Q14 net profit increased 19.7% YoY
IFS 3Q14 net profit increased 19.7% YoY IFRS Interbank Inteligo Net profit in S/. million Net profit in S/. million ROAE 24.6% 25.4% 25.2% ROAE 13.2% 34.2% 23.2% +18.1% +100.0% 43 177 187 159 28 14 3Q13 2Q14 3Q14 3Q13 2Q14 3Q14 Interseguro IFS Net profit in S/. million Net profit in S/. million ROAE
Slide 12: IFS key indicators 9M14
IFS key indicators 9M14 IFRS Intercorp Financial Services' key indicators S/. million 2012 2013 %chg 9M13 9M14 %chg Net interest and similar income 1,562.0 1,747.7 11.9% 1,282.0 1,483.4 15.7% Fee income from financial services, net 671.5 622.0 -7.4% 471.7 509.5 8.0% Results Profit for the period 765
Slide 13: IFS 9M14 net profit increased 2.5% excluding discount rate effect
IFS 9M14 net profit increased 2.5% (when excluding the effect of changes in the discount rate of technical reserves) IFRS Interbank Inteligo Net profit in S/. million Net profit in S/. million ROAE 25.1% 23.7% 24.4% 24.4% ROAE 28.3% 26.5% 30.7% 33.2% 615 568 522 464 119 109 99 93 2012 2013 9M13 9M14
Slide 14: Interbank
CJ Intercorp Financial Services
Slide 15: Interbank's net income grew 5.9% QoQ and 18.1% YoY
Interbank’s net income grew 5.9% QoQ and 18.1% YoY IFRS Banking Segment's P&L Statement S/. million %chg %chg 3Q13 2Q14 3Q14 QoQ YoY Interest and similar income 552.7 627.1 642.7 2.5% 16.3% Interest and similar expenses -157.7 -186.0 -187.4 0.7% 18.8% Net interest and similar income 394.9 441.0 455.
Slide 16: Interbank's net profit IFRS vs. Local GAAP
Interbank’s net profit IFRS vs. Local GAAP Net profit – IFRS Net profit bridge from Local GAAP to IFRS (3Q14) S/. million S/. million +18.1% $250 $200 11 177 187 1 159 16 67 $150 58 3Q13 2Q14 3Q14 Net profit – Local GAAP $100 192 187 S/. million $50 +22.3% 192 $0 157 164 Net profit Net interest Fee
Slide 17: Loan growth remained strong at 1.2% QoQ and 15.1% YoY
Loan growth remained strong at 1.2% QoQ and 15.1% YoY Performing loans Breakdown of loans S/. million S/. million %chg %chg 3Q13 2Q14 3Q14 QoQ YoY Consumer loans: +15.1% Credit cards 2,331.4 2,837.5 3,040.9 7.2% 30.4% Other consumer 3,034.3 3,338.9 3,447.7 3.3% 13.6% Total consumer loans 5,365.7 6,1
Slide 18: Interbank's deposits grew 6.9% YoY
Interbank’s deposits grew 6.9% YoY driven by strong retail deposit growth of 14.9% Funding structure Deposit breakdown S/. million S/. million %chg %chg 3Q13 2Q14 3Q14 QoQ YoY +6.9% Retail 7,334.8 8,217.3 8,427.5 2.6% 14.9% Commercial (1) 11,659.4 12,058.5 11,874.9 -1.5% 1.8% Deposits 18,994.2 20,27
Slide 19: Asset quality remains strong, with PDL below the system
Asset quality remains strong, with PDL & provision expenses below the system SBS figures PDL vs. System Loan provision expense Interbank Sytem Interbank Sytem Coverage 228.1% 210.3% 201.4% Ratio 2.5% 2.4% 2.4% 2.1% 2.1% 1.9% 2.3% 1.9% 2.0% 2.0% 1.8% 1.6% 3Q13 2Q14 3Q14 3Q13 2Q14 3Q14 Interbank PDL r
Slide 20: Fee income increased 6.7% YoY and efficiency ratio improved
Fee income increased 6.7% YoY and efficiency ratio improved Fee income Operating expenses S/. million S/. million 350 30.00% 49.8% 300 23.7% 23.8% 25.00% 500 .0 45.9% 46.6% 50.00% 22.2% 450 .0 250 400 .0 40.00% 20.00% 350 .0 200 300 .0 15.00% 30.00% 150 250 .0 200 .0 10.00% 20.00% 323.2 100 150 .0 3
Slide 21: Strong quarter at Interbank with sustained high ROE levels
Strong quarter at Interbank with sustained high ROE levels IFRS Net profit ROE S/. million Annualized +18.1% 24.6% 25.4% 25.2% 177 187 159 3Q13 2Q14 3Q14 3Q13 2Q14 3Q14 21
Slide 22: Interbank's BIS ratio remained well above regulatory requirements
Interbank’s BIS ratio remained well above regulatory requirements (1) System 13.7% 13.7% 14.5% 14.3% 13.9% 20.00% 15.8% 15.8% 15.0% 15.00% 13.7% 13.4% 4.4% 5.8% 5.8% 3.5% +1.8% Additional Regulatory Capital +1.5% 3.7% Requirement +1.1% 10.00% 10.0% Total Regulatory Minimum 5.00% 10.2% 9.7% 10.6% 10.
Slide 23: Interseguro
Interseguro CJ Intercorp Financial Services
Slide 24: Interseguro's net income was S/. 69.4 million in 3Q14
Interseguro’s net income was S/. 69.4 million in 3Q14 IFRS Profit and Loss Statement Summary S/. Million %chg %chg 3Q13 2Q14 3Q14 Qoq YoY Interest and similar income 45.3 53.2 48.8 -8.3% 7.6% Interest and similar expenses -0.4 -2.1 -2.1 1.7% 481.3% Gross financial margin 45.0 51.1 46.7 -8.7% 3.8% Pr
Slide 25: Interseguro's net profit IFRS vs. Local GAAP
Interseguro’s net profit IFRS vs. Local GAAP Net profit – IFRS Net profit bridge from Local GAAP to IFRS (3Q14) S/. million S/. million -4.7% 2 81 73 69 32 66 40 57 97 49 33 12 3Q13 2Q14 3Q14 6 Adjustment of technical reserves resulting from changes in discount rate 14 Net profit – Local GAAP 118 S/
Slide 26: Premiums decreased 5.1% QoQ but grew 20.4% YoY
Premiums decreased 5.1% QoQ but grew 20.4% YoY mainly supported by higher sales in annuities and retail insurance Net premiums Adjustment of technical reserves S/. million S/. million Annuities Discount rate 24.7% 24.9% 23.7% 40 32 57 market share impact 177 168 129 140 4 43 41 37 7 9 67 74 8 63 4 1
Slide 27: Interseguro's investment portfolio grew 20.1% YoY
Interseguro’s investment portfolio grew 20.1% YoY Investment portfolio Results from investments S/. million S/. million +20.1% ROI 9.2% 10.6% 6.5% 4,252 4,044 3,541 607 692 534 684 458 408 130 2,894 3,112 88 2,449 78 3Q13 2Q14 3Q14 3Q13 2Q14 3Q14 Fixed income Equity & Mutual funds Real estate Result
Slide 28: Inteligo
Inteligo CJ Intercorp Financial Services
Slide 29: Inteligo doubled its net profit YoY in 3Q14
Inteligo doubled its net profit YoY in 3Q14 Wealth Management Segment's P&L Statement S/. million %chg %chg 3Q13 2Q14 3Q14 QoQ YoY Interest and similar income 26.6 28.1 24.5 -12.7% -7.6% Interest and similar expenses -11.4 -12.4 -11.1 -10.7% -2.4% Net interest and similar income 15.2 15.7 13.5 -14.3
Slide 30: Inteligo's key indicators
Inteligo’s key indicators AUMs + Deposits Loans S/. million S/. million +20.0% +20.2% 1,258 1,310 10,830 1,090 9,021 9,635 2,194 1,944 1,992 7,078 7,643 8,636 3Q13 2Q14 3Q14 3Q13 2Q14 3Q14 Deposits AUM Revenues Net profit S/. million S/. million (1) Fee AUMs 1.0% 1.4% 1.1% ROAE 70.00 13.2% 34.2% 23.
Slide 31: Summary
CJ Intercorp Financial Services
Slide 32: Sound 3Q operating performance in all segments
Sound 3Q operating performance in all 3 segments with strong asset quality and high profitability Interbank 15.1% YoY growth in performing loans and 20.9% growth in consumer loans 14.9% YoY growth in retail deposits 2.0% PDL ratio vs System average of 2.4% Interseguro 20.4% YoY growth in
Slide 33: Agenda
Agenda 1 Overview of today’s call 2 3Q14 results under IFRS and local GAAP 3 Appendix 33
Slide 34: IFS 3Q14 P&L
IFS 3Q14 P&L IFS Intercorp Financial Services' P&L statement S/. million %chg %chg 3Q13 2Q14 3Q14 QoQ YoY Interest and similar income 625.3 692.5 716.2 3.4% 14.5% Interest and similar expense -169.3 -200.4 -200.4 0.0% 18.4% Net interest and similar income 456.0 492.1 515.7 4.8% 13.1% Provision for l
Slide 35: Highlights 9M14
Highlights 9M14 IFRS IFS net profit was S/. 691.3 million in 9M14, a 17.3% decrease YoY Intercorp The YoY decrease was explained by a S/. 273.5 million increase in the adjustment of technical reserves Financial due to changes in the discount rate which negatively impacted Interseguro’s net profi
Slide 36: IFS 9M14 P&L
IFS 9M14 P&L IFS Intercorp Financial Services' P&L Statement S/. million 9M13 9M14 %chg S/. chg Net interest and similar income 1,764.6 2,069.5 17.3% 304.9 Fee income from financial services, net -482.6 -586.1 21.4% -103.5 Total premiums earned less claims 1,282.0 1,483.4 15.7% 201.4 Premiums -270.9
Slide 37: Interbank's 9M14 net profit bridge to IFRS
Interbank’s 9M14 net profit bridge to IFRS SBS GAAP vs. IFRS $600 S/. million 13 $500 6 33 213 $400 203 Release of Higher provision Cross currency swap loss change from generic expenses(1) provisions, lower unrealized earnings (SBS GAAP) to loss depreciation and $300 (IFRS) lower taxes 517 522 $200
Slide 38: Interseguro's 9M14 net profit bridge to IFRS
Interseguro’s 9M14 net profit bridge to IFRS SBS GAAP vs. IFRS S/. million 32 4 Under SBS GAAP gains on sale of securities held to maturity are amortized over the life of the Real estate gains on 130 instrument whereas under Use of different valuation are recognized IFRS gains are recognized discoun
Slide 39: Fl _—_._ Financial Services
Fl _—_._ Financial Services
Intercorp Financial Services — Q3 2014 Earnings Presentation on 6ix