Banco Comercial Portugues S.a. · EURONEXT:BCP
Banco Comercial Portugues — 9M 2022 Earnings Presentation
60 slides from Banco Comercial Portugues's earnings presentation, 2022
Slide 1: Earnings Presentation 9M 2022
Millennium bcp EARNINGS PRESENTATION 9M 2022 Banco Comercial Portugués, S.A.
Slide 2: Disclaimer
Disclaimer l The information in this presentation has been prepared under the scope of the International Financial Reporting Standards (‘IFRS’) of BCP Group for the purposes of the preparation of the consolidated financial statements under Regulation (CE) 1606/2002, as amended. l The figures present
Slide 3: Agenda
AGENDA 3
Slide 4: Highlights
01 Highlights 4
Slide 5: Highlights: Robust business model
Highlights: Robust business model ▪ Net profit of 97.2 million which compares to 59.5 million in September 2021, influenced by: ➢ Increase of 24.7% in Group's core income and strict management of recurrent operating costs (+2.6%) ➢ Extraordinary effects related with Bank Millennium, namely, 393.01 m
Slide 6: Highlights: Robust business model
Highlights: Robust business model ▪ Consolidated performing loans up by 1.1 billion from September 2021 (+1.8 billion excluding FX effect); Performing loans in Portugal up by 1.4 billion, +3.7% from September 2021 Business ▪ Total Customer funds up by 3.1 billion from September 2021 (+3.8 billion ex
Slide 7: Growing Customer base, with mobile Customers standing out
Growing Customer base, with mobile Customers standing out ‘000 Customers As % of active Customers Group Active Customers 6,070 6,416 +650 3,318 3,968 62% +20% Mobile Customers Sep. 21 Sep. 22 +522 Digital Customers 4,150 4,672 73% +13% Active Customers 2,499 2,633 +224 1,338 1,114 51% +20% Mobile Cu
Slide 8: Our capabilities in digital are widely recognised and recommended
A. Our capabilities in digital are widely recognised and recommended App Millennium “Best Consumer Digital Bank” in Portugal 2022 leads Digital Channels Satisfaction ratings #1 NPS1 Digital Customers 2018 – 2022 (Sep.), “Best Digital Bank” Unaided reply by 5 largest banks Customers2, (Sep.) 4.8 53.9
Slide 9: Innovation focused on customer needs translates into accelerated growth in Mobile
Innovation focused on customer needs translates into accelerated growth in Mobile usage and sales Strong mobile growth Y/Y (Number of operations, jan-sep 2022 vs jan–sep 2021) +25% +51% Transfers +26% National +13% Payments Transactions P2P Transfers +47% +107% +127% +38% Sales Cards Personal loans
Slide 10: Group Profitability
02 Group Profitability 10
Slide 11: Net income of 97.2 million in the first nine months of 2022
Net income of 97.2 million in the first nine months of 2022 Impact on (Million euros) 9M21 9M22 YoY earnings Net interest income 1,165.0 1,545.8 +32.7% +380.9 Commissions 534.8 573.8 +7.3% +39.0 Core income 1,699.8 2,119.6 +24.7% +419.8 Operating costs recurring1 -761.6 -781.4 +2.6% -19.8 Recurring
Slide 12: Net interest income
Net interest income Net interest income Portugal (Consolidated, million euros) (Million euros) Net interest Net interest margin 1.45% 1.45% margin 1.91% 2.38% +8.3% +32.7% 670.9 1,545.8 619.5 1,165.0 9M21 9M22 International operations (Million euros) Net interest 2.98% 4.66% margin +60.4% 875.0 545.
Slide 13: Fees and commissions
Fees and commissions Fees and commissions Portugal (Consolidated, million euros) (Million euros) +7.3% +10.9% 573.8 417.7 376.6 534.8 63.1 78.5 58.4 Market-related 81.5 fees and 318.2 354.6 commissions 9M21 9M22 International operations (Million euros) Banking fees 495.3 -1.3% 453.3 and commissions
Slide 14: Other income
Other income Other income Portugal (Consolidated, million euros) (Million euros) 39.5 82.1 Total -2.3 -61.6 54.5 43.9 64.1 98.9 Equity earnings + 54.2 -68.6 -71.3 43.0 dividends 9M21 9M22 Net trading income 71.5 74.9 Mandatory contributions 77.2 88.5 Of which: Banking sector 33.1 36.8 Resolution fun
Slide 15: Operating costs
Operating costs Operating costs Portugal (Consolidated, million euros) (Million euros) Cost to income 50% 38% Cost to income 52% 38% -17.9% 541.1 -7.3% Non-recurring* 444.2 849.3 87.6 6.1 787.4 Non-recurring* 87.6 6.1 Recurring 453.5 -3.4% 438.2 Depreciation 102.8 103.9 9M21 9M22 Other administrativ
Slide 16: Cost of risk and provisions
Cost of risk and provisions Portugal Impairment and provision charges (Million euros) (Consolidated, million euros) Cost of risk 68bp 57bp -10.8% 307.0 273.9 Cost of risk 60bp 55bp 103.3 99.7 +48.5% 1,078.2 203.7 174.1 102.3 Goodwill Bank 9M21 9M22 -23.5% Millennium Loan-loss reserves 1,324 1,012 Cr
Slide 17: Relevant reduction of NPEs under a complex context
Relevant reduction of NPEs under a complex context Credit (Consolidadas, milhõesquality de euros) Portugal (Consolidated, billion euros) (Billion euros) -394 millions -20.4% -408 millions 1.93 -14.4% 1.54 NPE 2.83 2.42 Other 1.45 Sep. 21 Sep. 22 1.54 NPL>90d NPE loans ratio 4.8% 3.7% 1.38 0.88 NPE r
Slide 18: Group Business activity
02 Group Business activity 18
Slide 19: Customer funds maintain growth trend
Customer funds maintain growth trend Total Customers Funds* Total Customers Funds* Portugal (Billion euros) (Consolidated, billion euros) +3.5% +4.2% 64.5 67.2 91.1 88.0 14.6 16.8 1.3 1.5 17.6 15.9 16.1 Off-BS funds 18.9 1.3 30.0 33.7 Other BS funds 1.5 Sep. 21 Sep. 22 25.7 Term deposits 20.7 Total
Slide 20: Relevant increase of the loan portfolio
Relevant increase of the loan portfolio Loans to Customers (gross) Portugal (Consolidated, billion euros) (Billion euros) NPE: -14.4% (-0.4 billion) +1.03 billion Performing: +1.9% (+1.1 billion) +2.6% 41.03 +1.43 +1.1% 40.00 58.0 58.6 -0.39 27.5 27.9 Sep. 21 NPE Performing Sep. 22 Mortgage Internat
Slide 21: Group Capital and liquidity
02 Group Capital and liquidity 21
Slide 22: Capital above regulatory requirements
Capital above regulatory requirements Total capital ratio • Despite the extraordinary impacts recorded by (Fully implemented) Bank Millennium in Q3’22, total capital ratio +2.0pp Fully implemented vs requirement stood at 15.1% and CET1 capital ratio at 15.2% 15.7%** application of article 11.4% (ful
Slide 23: Capital at adequate levels
Capital at adequate levels Leverage ratio (Fully implemented, latest available data) 5.8% 5.5% 4.8% 4.9% Leverage ratio at 5.5% as of September 2022, a 3.5% comfortable and comparatively strong figure in European 3.0% banking FR DE ES IT RWA density (RWAs as a % of assets, latest available data) 47%
Slide 24: Reinforced liquidity position
Reinforced liquidity position Liquidity ratios (CRD/CRR) ECB funding, net (Billion euros) Eligible assets 25.2 24.4 264% -2.4 billion Net funding 3.8 1.3 TLTRO 8.2 8.2 Deposits and other -4.4 -6.8 153% Sep. 21 Sep. 22 Net loans to deposits ratio 83% 77% 100% NSFR (Net stable LCR (Liquidity Sep. 21 S
Slide 25: Portugal
03 Portugal 25
Slide 26: Profitability in Portugal
Profitability in Portugal Net income Net operating revenue (Million euros) (Million euros) +66.8% Net income on a 179.8 299.9 comparable basis* +156.7% +13.0% 295.7 1,170.6 1,035.6 115.2 9M21 9M22 9M21 9M22 Operating costs (Million euros) • Net income of 295.7 million in the first nine months -17.9%
Slide 27: Net interest income
Net interest income (Million euros) +8.3% +36.3 670.9 +27.7 +2.9 619.5 -7.2 -2.5 -0.9 -4.8 -0.1 NIM 1.45% 1.45% 9M21 Performing Credit rate Impact of Deposit's rate Excess liquidity Impact of Effect of Other 9M22 credit volume effect NPE reduction effect (ECB, TBills) securities wholesale cost effec
Slide 28: Commissions and other income
Commissions and other income Commissions (Milhões deOther euros) income (Million euros) (Million euros) 9M21 9M22 YoY Banking fees and commissions 318.2 354.6 +11.4% Total 39.5 82.1 Cards and transfers 80.3 104.6 +30.3% Loans and guarantees 78.7 74.5 -5.3% 54.5 Bancassurance 63.9 64.1 +0.3% Equity e
Slide 29: Operating costs
Operating costs Operating costs Employees (Million euros) -3.4% -254 Recurring 453.5 438.2 541.1 6,511 6,257 Non-recurring* 87.6 444.2 6.1 Depreciation 60.2 59.1 Sep. 21 Sep. 22 Other administrative 128.4 costs 133.5 Branches -39 Staff costs 264.9 245.5 447 408 9M21 9M22 Sep. 21 Sep. 22 *9M21: Inclu
Slide 30: Continued decrease of NPEs
Continued decrease of NPEs Non-performing exposures (NPE) NPE build-up (Million euros) Sep. 22 Sep. 22 (Million euros) -394 millions vs. Sep. 21 vs. Dec. 21 Opening balance 1,931 1,878 -20.4% Net outflows/inflows 264 191 1,931 1,537 Write-offs -435 -357 Other NPE 1,047 Sales -223 -175 NPL>90d 1,091
Slide 31: NPE coverage
NPE coverage NPE total coverage* NPL>90d total coverage* 226% 131% 43% 174% 123% 2% 100% 46% Real estate collateral 52% Real estate collateral 55% 100% 1% Cash, other fin.collat. 2% 180% 65% 2% Cash, other fin.collat. 49% 77% 1% 127% LLRs 1% 66% LLRs 33% 50% Individuals Companies Total Individuals C
Slide 32: Foreclosed assets and corporate restructuring funds
Foreclosed assets and corporate restructuring funds Foreclosed assets Corporate restructuring funds (Million euros) (Million euros) 641 +0.6% 789 793 Impairment 135 82 335 89 Industry -241 million 69 Net value 506 700 711 RE/tourism -47.6% 265 Sep. 21 Sep. 22 Sep. 21 Sep. 22 Sales of foreclosed asse
Slide 33: Growing customer funds and loans to customers
Growing customer funds and loans to customers Total Customers Funds* Loans to Customers (gross) (Billion euros) (Billion euros) +4.2% NPE: -20.4% (-0.4 billion) 67.2 Performing: +3.7% (+1.4 billion) 64.5 +2.6% 14.6 41.0 Off-BS funds 16.8 40.0 1.3 Other BS funds 1.5 17.6 18.9 Term deposits 16.1 Mortg
Slide 34: Performing credit grows in Portugal
Performing credit grows in Portugal Performing credit portfolio (Billion euros) • Performing credit portfolio in Portugal up by 1.4 billion (+3.7%) from +3.7% September 2021, supported in growth in mortgage loans and loans to companies 38.1 39.5 • Mortgage loans up by 0.8 billion from September 2021
Slide 35: International operations
04 International operations 35
Slide 36: Contribution from operations to consolidated net income
Contribution from operations to consolidated net income (Million euros*) 9M21 9M22 Contribution from international operations (Million euros) Poland -176.2 -270.5 Mozambique1 66.1 69.9 Other -17.2 -8.8 9M21 9M22 Net income international operations -127.3 -209.4 Net income without -96.2 goodwill impa
Slide 37: Net earnings influenced by extraordinary effects
Net earnings influenced by extraordinary effects Net income Net operating revenue (Million euros1) (Million euros1) +127.4% 392.3 +48.1% 835.2 172.5 Adjusted net income2 564.1 Net income -176.2 -270.5 9M21 9M22 9M21 9M22 3m WIBOR (average) 0.21% 5.63% • Adjusted net income2 up by 127.4% • Net losses
Slide 38: Net interest income increase significantly
Net interest income increase significantly Net interest income Operating costs (Million euros*) (Million euros*) +34.5% NIM 2.60% 4.36% 347.8 Resol. Fund + DGF +75.3% 258.6 +293.9% 84.9 + IPS** 730.3 21.6 105.8 +11.2% 117.7 Other 416.6 131.3 +10.6% 145.2 Staff costs 9M21 9M22 9M21 9M22 Commissions a
Slide 39: Credit quality
Credit quality NPL>90d Loan-loss reserves (Million euros*) (Million euros*) Credit ratio Credit ratio NPL>90d 2.5% 2.2% NPL>90d 128% 144% 518.5 524.8 406.0 363.8 Sep. 21 Sep. 22 Sep. 21 Sep. 22 Loan impairment (net of recoveries) (Million euros*) • NPL>90d accounted for 2.2% of total credit as of Co
Slide 40: Customers funds and loans to Customers
Customers funds and loans to Customers Customers funds Loans to Customers (gross) (Million euros*) (Million euros*) +4.4% +2.2% 21,526 20,628 1,322 16,488 16,843 Off-BS funds 1,969 Other BS funds 8 Term deposits 3,476 6,763 Mortgage local currency 6,644 7,287 Mortgage foreign exchange 2,248 1,722 De
Slide 41: CHF mortgages
CHF mortgages CHF mortgage portfolio (gross w/o legal risk provisions) Cumulative provisions for legal risks** (Billion euros*) (Million euros*) As a % of total As a % of CHF 6.9% 14.9% 19.5% 25.7% 30.9% 36.3% 41.3% mortgage portfolio 54.6% 12.6% 11.4% 10.5% 9.6% 9.4% loan portfolio (gross after leg
Slide 42: Net income reflects resilience in challenging environment
Net income reflects resilience in challenging environment Net income** Net operating revenue (Million euros*) (Million euros*) +6.9% 188.0 +5.7% 175.9 66.1 69.9 9M21 9M22 9M21 9M22 MIMO rate (average) 12.95% 14.60% Operating costs (Million euros*) • Net income of 69.9 million in the first nine month
Slide 43: Increased net interest income and commissions
Increased net interest income and commissions Net Interest income Operating costs (Million euros*) (Million euros*) NIM 7.7% 7.9% Cost to income 44.0% 43.8% +7.8% +6.5% 143.7 77.4 82.4 133.3 44.6 +7.4% 47.9 Other Staff Costs 32.7 +5.2% 34.5 9M21 9M22 9M21 9M22 Commissions and other income Employees*
Slide 44: Credit quality
Credit quality NPL>90d Loan-loss reserves (Million euros*) (Million euros*) Credit ratio Coverage ratio NPL>90d 11.1% 9.7% NPL>90d 76% 103% 74.7 82.3 62.5 72.5 Sep. 21 Sep. 22 Sep. 21 Sep. 22 Loan impairment (net of recoveries) (Million euros*) Cost of risk 141bp 181bp • NPL>90d ratio of 9.7% as of
Slide 45: Business volumes
Business volumes Customers funds Loans to Customers (gross) (Million euros*) (Million euros*) +3.9% +1.4% 2,266 2,181 739 750 Mortgage 12 12 Personal and other 148 168 Term deposits 1,023 1,242 Companies 579 570 Demand 1,158 deposits 1,024 Sep. 21 Sep. 22 Sep. 21 Sep. 22 *FX effect excluded. €/Metic
Slide 46: Key figures
05 Key figures 46
Slide 47: Strategic Plan: Excelling 24
Strategic Plan: Excelling 24 9M22 2024 C/I ratio 38% ≈40% Cost of risk 55 bp ≈50 bp RoE 2.5% ≈10% CET1 ratio 11.4% >12.5% (11.8% pro forma*) NPE ratio 4.1% ≈4% Share of mobile Customers 62% >65% Growth of high engagement +9% +12% Customers** (vs 2020) Average ESG rating*** 70% >80% *Pro forma (subje
Slide 48: Commitment to People and Society
COMMITMENT TO PEOPLE AND SOCIETY Millennium bcp Foundation Society Sustainability Q3 Q3 Q3 Millennium bcp volunteers on the Millennium turns off the signs of its branches Lisbon Architecture Triennale: Lisbon Millennium bcp Triennial Awards 2022 portuguese beaches with the Brigada do in Portugal and
Slide 49: Awards in 2022
Awards in 2022 3T 3T Millennium bcp: Best Digital Bank 2022 in Portugal Bank Millennium: Millenet internet banking on the top of the BANK monthly ranking Millennium bcp Consumer Choice 2022, Millennium bcp: Best Foreign Exchange Provider in Bank Millennium: Distinguish with the CSR Golden “Large Ban
Slide 50: Appendix
Appendix 50
Slide 51: Sovereign debt portfolio
Sovereign debt portfolio Sovereign debt portfolio Sovereign debt maturity (Consolidated, million euros) >5y, ≤8y: 37% Sep 21 Dec 21 Mar 22 Jun 22 Sep 22 YoY QoQ Portugal 8,069 8,013 8,561 7,765 6,882 -15% -11% T-bills and other 497 426 849 1,222 461 -7% -62% >8y, ≤10y: 14% Bonds 7,572 7,587 7,712 6,
Slide 52: Sovereign debt portfolio
Sovereign debt portfolio (Million euros) Portugal Poland Mozambique Other Total Trading book 484 31 0 0 515 ≤ 1 year 460 1 0 0 461 > 1 year and ≤ 2 years 4 14 0 0 18 > 2 years and ≤ 5 years 11 7 0 0 18 > 5 years and ≤ 8 years 6 7 0 0 13 > 8 years and ≤ 10 years 3 2 0 0 4 > 10 years 1 0 0 0 1 Banking
Slide 53: Diversified and collateralised portfolio
Diversified and collateralised portfolio Loan portfolio (Consolidated) LTV of the mortgage portfolio Breakdown Loans per collateral in Portugal Other 75-80 Mortgage guarantees 9% 48% 60-75 80-90 29% 27% 12% Companies >90 42% Real 5% guarantees 57% 50-60 Unsecured 0-40 14% 15% 21% 40-50 12% Personal/
Slide 54: Consolidated net income
Consolidated net income Impact on (Million euros) 9M21 9M22 YoY earnings Net interest income 1,165.0 1,545.8 +32.7% +380.9 Net fees and commissions 534.8 573.8 +7.3% +39.0 Other income* -2.3 -61.6 +2582.6% -59.3 Net operating revenue 1,697.5 2,058.0 +21.2% +360.5 Staff costs -516.1 -431.8 -16.3% +84
Slide 55: Consolidated balance sheet
Consolidated balance sheet (Million euros) 30 September 30 September 30 September 30 September 2022 2021 2022 2021 LIABILITIES ASSETS Financial liabilities at amortised cost Cash and deposits at Central Banks 3,122.9 5,557.4 Resources from credit institutions 8,967.3 9,072.0 Loans and advances to cr
Slide 56: Consolidated income statement per quarter
Consolidated income statement per quarter (Million euros) Quarterly 3Q 21 4Q 21 1Q 22 2Q 22 3Q 22 Net interest income 399.2 423.6 465.1 520.1 560.7 Dividends from equity instruments 0.2 0.1 0.9 12.0 -3.6 Net fees and commission income 181.9 192.9 192.8 194.7 186.2 Other operating income -4.5 -9.5 -1
Slide 57: Income statement
Income statement (Million euros) For the 9-month periods ended September 30th, 2021 and 2022 Int e rna t io na l o pe ra t io ns G ro up P o rt uga l T o tal B a nk M ille nnium ( P o la nd) M ille nnium bim ( M o z.) O t he r int . o pe ra t io ns Sep 2 1 Sep 2 2 Δ % Sep 2 1 Sep 2 2 Δ % Sep 2 1 Sep
Slide 58: Glossary (1/2)
Glossary (1/2) Assets placed with customers – amounts held by customers in the context of the placement of third-party products that contribute to the recognition of commissions. Balance sheet customer funds – deposits and other resources from customers and debt securities placed with customers. Bus
Slide 59: Glossary (2/2)
Glossary (2/2) Net trading income – results from financial operations at fair value through profit or loss, results from foreign exchange, results from hedge accounting operations, results from derecognition of financial assets and financial liabilities measured at amortized cost and results from de
Slide 60: Investor Relations Division
INVESTOR RELATIONS DIVISION Bernardo Collaço, Head EQUITY DEBT AND RATINGS Alexandre Moita Luís Morais +351 211 131 321 +351 211 131 337 investors@millenniumbcp.pt BANCO COMERCIAL PORTUGUÊS, S.A., a public company (Sociedade Aberta), having its registered office at Praça D. João I, 28, Oporto, regis
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