Komercni Banka, A.s. · PSECZ:KOMB
Komercni Banka, A.s — 9M 2014 Earnings Presentation
34 slides from Komercni Banka, A.s's earnings presentation, Nov 6, 2014
Slide 1: Komerční banka Group Financial results as of 30 September 2014
Komerční ní banka Group Financial results as of 30 September 2014 According to International Financial Reporting Standards, consolidated, unaudited Prague, 6 November 2014
Slide 2: Disclaimer
Disclaimer This document contains a number of forward-looking looking statements relating to the targets and strategies of the Komerční ní 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 me
Slide 3: Agenda
Agenda Business results 4 Financial results 10 Loan portfolio quality and cost of risk 19 Appendix 22 3
Slide 4: Economy of the Czech Republic
Economy of the Czech Republic Good economic outlook boosted by domestic demand, but financial conditions to remain challenging Czech GDP in 2Q +2.5% YoY, +0.3% QoQ. Real GDP outlook (YoY, %) Gross value added rose in all segments of the economy 2.1 2.0 2.3 2.3 Industrial activity still driven mainly
Slide 5: Komerční banka in the nine months of 2014
Komerční banka in the nine months of 2014 Excellent inflow of clients, despite intense competition. The number of KB’s clients was boosted by the well-liked liked MojeOdměny rewards programme Valuable franchise Deposits expanded by 12%, rising in retail as well as corporate. Investments in mutual Cl
Slide 6: Selected deals of the third quarter of 2014
Selected deals of the third quarter of 2014 PointPark Properties (P3) NET4GAS, s.r.o. Energy 21 Group Acquisition and development Reg S Senior Unsecured Notes Senior Term Loan Facility financing EUR 379,775,000 CZK 7,000,000,000 CZK 1,800,000,000 Mandated Lead Arranger Joint Lead Manager and Mandate
Slide 7: Positive trend of lending
Loans to clients Positive trend of lending CZK billion 475.7 491.5 484.9 491.8 494.7 475.0 Gross loans up 4.0% YoY*, +0.6% QoQ. 43.6 40.8 39.6 46.8 45.2 42.1 Group housing loans +4.4% YoY, o/w mortgages 137.3 141.5 146.2 147.8 151.2 155.4 to individuals rose 9.8% YoY to CZK 155.4 28.5 28.7 29.0 27.5
Slide 8: Dynamic growth of assets under management
Deposits and assets under management Dynamic growth of assets CZK billion By Customers 679.0 under management 606.9 609.3 649.2 658.9 72.5 656.5 72.1 71.8 72.3 71.4 71.3 161.8 162.9 167.8 172.9 Group deposits up 12.0% YoY* to CZK 662.8 bil., 157.4 157.3 35.8 37.2 38.0 38.8 +3.8% QoQ (excluding repos
Slide 9: Agenda
Agenda Business results 4 Financial results 10 Loan portfolio quality and cost of risk 19 Appendix 22 9
Slide 10: Net profit stable
Consolidated income statement Net profit stable Profit and Loss Statement Change 9M 2013 9M 2014 YoY (CZK million, unaudited) Net interest income 15,879 16,009 0.8% Net fees & commissions 5,315 5,049 -5.0% Income from financial operations 1,986 1,722 -13.3% Other income 101 86 -14.9% Net banking inc
Slide 11: Underlying balance sheet growth driven by deposits
Consolidated statement of financial position Underlying balance sheet growth driven by deposits 30 Sep 31 Dec 30 Sep Change Change Balance Sheet 2013 2013 2014 YoY YtD (CZK million, unaudited) Assets 804,125 863,980 914,624 13.7% 5.9% Cash and balances with central bank 50,280 44,405 67,653 34.6% 52
Slide 12: Equity boosted by net profit and revaluation of hedges
Shareholders’ equity Equity boosted by net profit and revaluation of hedges Development year-to-date Total shareholders’ equity +7,612 7,612 Total shareholders’ equity as of 31 December 2013 as of 30 September 2014 31/12/2013 1/1/2014 Increase Decrease 30/09/2014 Share capital 19,005 19,005 19,005 C
Slide 13: Strong balance sheet and solid profitability indicators
Financial ratios Strong balance sheet and solid profitability indicators Key ratios and indicators 30 Sep 30 Sep Change 2013 2014 YoY (year-to-date) Capital adequacy * 16.7% 17.1% n.a. Tier 1 ratio * 16.7% 17.1% n.a. Total risk weighted assets (CZK billion) * 355.4 380.8 n.a. Risk weighted assets fo
Slide 14: NII slightly up thanks to business volumes
Net interest income NII slightly up thanks to business volumes 5,327 5,293 5,328 5,279 5,335 5,395 NII in 9M 2014 up by 0.8% YoY. NII in 3Q 2014 416 434 404 462 419 444 increased by 1.1% QoQ 2,434 2,395 2,448 2,392 2,444 2,479 NII from loans – reflecting volume growth and protection of spreads in th
Slide 15: Pressure on fees from basic products
Net fees and commissions Pressure on fees from basic products, rising income from cross-selling selling and advanced solutions 1,800 1,790 1,761 NFC in 9M 2014 down by 5.0% YoY. In 2Q 2014 1,690 1,711 1,647 176 217 177 down by 3.7% QoQ 250 220 319 200 322 272 229 250 224 Deposit product fees – switc
Slide 16: Better activity in the third quarter
Net profit from financial operations Better activity in the third quarter Net profit from financial operations in 9M 2014 729 661 646 down by 13.3% YoY. NPFO in 3Q rose by 571 27.7% QoQ 503 506 359 332 341 205 285 200 Improved result of treasury mainly on IR in 3Q, after low 2Q 2014 was affected by
Slide 17: Continued rigorous cost control
Operating expenditures Continued rigorous cost control 2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014 3Q 2014 OPEX in 9M 2014 decreased by 1.0% YoY. OPEX in 3Q 2014 up by 1.7% QoQ -1,681 -1,719 -1,694 -1,655 -1,679 -1,733 Ongoing efforts on process optimisation and extracting operating efficiencies, while
Slide 18: Agenda
Agenda Business results 4 Financial results 10 Loan portfolio quality and cost of risk 19 Appendix 22 18
Slide 19: Persisting good loan quality
Loan portfolio quality Persisting good loan quality Gross lending CZK billion 491.5 484.9 491.8 494.7 475.0 475.7 Loan exposure +4% YoY, +0.6% QoQ Share of Standard and Watch loan exposure stable at 94.5% (94.5% in 2Q 2014) 437.0 438.7 454.4 447.6 454.7 458.9 Share of LUSR exposure stable at 5.5% (5
Slide 20: Low and stable cost of risk
Cost of risk Low and stable cost of risk Total Cost of Risk (Year-to-date, in basis points) 2Q 2013 3Q 2013 4Q 2013 1Q 2014 2Q 2014 3Q 2014 3Q 2014 cost of commercial risk remains at low level similar to 2Q 2014 results, mainly due to 49 continuing favourable environment in Corporate 44 43 segment i
Slide 21: Agenda
Agenda Business results 4 Financial results 10 Loan portfolio quality and cost of risk 19 Appendix 22 21
Slide 22: Number of clients and distribution network
Number of clients and distribution network Number of bank clients (ths., CZ) KB Group’s 2.5 million clients, of which KB bank 1,621,000 clients (+3%) MPSS 557,000 clients (-3%) KBPS 558,000 clients (-1%) 1,620 1,621 1,590 1,602 1,602 1,589 ESSOX 277,000 active clients (+1%) Network 399 branches for
Slide 23: Consolidated financial results
Consolidated financial results Profit and Loss Statement Change Change 3Q 2013 2Q 2014 3Q 2014 YoY QoQ (CZK million, unaudited) Net interest income 5,293 5,335 5,395 1.9% 1.1% Net fees & commissions 1,790 1,711 1,647 -8.0% -3.7% Income from financial operations 661 506 646 -2.3% 27.7% Other income 3
Slide 24: KB consolidated group
KB consolidated group KB Penzijní Pension Management company for Transformed Fund (pension fund with 558,000 clients) and for společnost insurance new pension funds in 2nd and 3rd pillars of the Czech pension system (100%) Modrá pyramida Building #2 largest building savings bank according to loan vo
Slide 25: Business performance of subsidiaries 1/2
Business performance of subsidiaries 1/2 Change 9M 2013 9M 2014 YoY MPSS Volume of new loans (CZK million) 2,422 2,385 -1% Volume of total loans (gross, CZK million) 45,180 39,553 -12% Volume of deposits (CZK million) 72,092 71,758 0% Number of clients 574,682 557,159 -3% Average number of FTEs 341
Slide 26: Business performance of subsidiaries 2/2
Business performance of subsidiaries 2/2 Change 9M 2013 9M 2014 YoY Factoring Factoring turnover (CZK million) 18,749 24,774 32% KB Volume of total financing (gross, CZK million) 3,984 5,993 50% Average number of FTEs 43 42 -2% KP Volume of technical reserves (CZK million) 33,019 41,726 26% Premium
Slide 27: 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 100% 9,582 -10.4%* 90,609 10.7% 825,474 15.5% - o/w KB branch in Slovakia IFRS 100% 117 303.4% n.a. n.a. 23,420 17.1% ESSOX, s.r.o. IFRS 50.93%
Slide 28: Securities portfolio in the banking book
Securities portfolio in the banking book CZK billion Available-for-sale portfolio Held-to-maturity portfolio CZK 78.6 billion CZK 75.3 billion 42.4 66.5 8.9 2.6 21.1 8.8 3.5 Czech sovereign Foreign sovereign Czech financial institutions Foreign financial institutions Czech sovereign Foreign sovereig
Slide 29: Foreign sovereign exposure
Foreign sovereign exposure 8.9 CZK billion 8.8 France, 0.2 EIB, 1.4 Poland, 1.4 Poland, 3.8 Slovakia, 6.1 Slovakia, 4.8 2.6 EIB, 0.1 Poland, 0.1 Slovakia, 2.4 Trading book 1) Available-for-sale 1) Available Held-to-maturity 2) Measurement at [1] fair value; [2] amortized cost 29
Slide 30: Macroeconomic environment – Czech Republic
Macroeconomic environment – Czech Republic Macroeconomic Indicators 2010 2011 2012 2013 2014* 2015* Real GDP (%, average) 2.1 2.0 -0.7 -0.7 2.3 2.3 Inflation (%, average) 1.5 1.9 3.3 1.4 0.4 0.7 Household consumption (%, average) 0.9 0.3 -1.8 0.4 1.5 2.4 Unemployment (%, av., MLSA meth.) 7.0 6.6 6.8
Slide 31: Interest rates evolution
Interest rates evolution (for the period 1 January 2005 – 27 October 2014) 5.0% 4.5% 4.0% 3.5% 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Pribor 3M Pribor 6M ČNB REPO Rate IRS 5Y IRS 10Y 31
Slide 32: Development of KB's share price and PX Index
Development of KB’s share price and PX Index (for the period 1 October 2001 – 27 October 2014) 500% 400% 300% 200% 100% 0% 2001 2003 2005 2007 2008 2010 2012 2014 KB PX index 32
Slide 33: KB shareholders
KB shareholders As of 30 September 2014 The number of shareholders comprised 41,910 corporate entities and private individuals. Of the Bank’s total share capital of CZK 19,004,926,000 divided into 38,009,852 shares with a nominal value of CZK 500 each, Société Générale S.A. holds 60.35% Others 39.6%
Slide 34: Investor Relations
Investor Relations Jakub Černý, erný, Georgina Olegrová, Olegrová Robert Janeček Tel.: +420 955 532 156, 955 532 734, 734 955 532 155 E-mail: mail: investor_relations@kb.cz - Internet: www.kb.cz 34