Credito Emiliano S.p.a. · MIL:CE
Credito Emiliano — FY2005 Earnings Presentation
26 slides from Credito Emiliano's earnings presentation, March 2006
Slide 1: Credem FY2005
CREDEM CREDEM FY2005 1 March ‘06
Slide 2: Group Profile, Results, History & Planning
CREDEM • Group Profile • Results • History & Planning 2 March ‘06
Slide 3: Credem at a glance
CREDEM Credem at a glance • Based in Emilia Romagna, one of Italian richest regions • Italy's 14th largest banking group • Italy's 12th largest asset manager • Listed on Milan Stock Exchange since 1997 and market cap around 3 billions • 455 branches in Italy • 700,000 customers and Eur 69.2 bln in c
Slide 4: S&P: outlook upgraded
CREDEM S&P: outlook upgraded Ratings Standard & Poor’s Ratings Fitch-IBCA Short Term A2 Short Term F1 Long Term A- Long Term A Outlook Positive Outlook Stable Last review: 16 January ‘06 Individual B “.. The ratings on Credem reflect its strong financial profile, based on very strong asset quality,
Slide 5: Key financials data
CREDEM Key financials data FY04 IAS compliant FY05 FY04 Assets under management (AUM) 18.0 bln 15.9 bln Assets under custody (AUC) 25.0 bln 23.0 bln (AUM+AUC) / Total Business 62. 1% 61.2% AUM/AUC 72.0 % 69.1 % Direct Deposits 8.6 bln 7.8 bln Loans to customers 12.6 bln 11.6 bln NPL ratio 0.18% 0.28
Slide 6: Shareholding structure
CREDEM Shareholding structure Pact among 226 More than 2,900 other shareholders shareholders Main Shareholders Maramotti family 35.5% Pictet Cie 4.9% Eredi Savioli 2.9% Fincorrad 2.1% Allianz Subalpina 1.7% 72.6% 27.4% CREDEMHOLDING Free Float on Milano Stock Exchange 72.2% 27.8% CREDEM 6 March ‘06
Slide 7: Credem stock
CREDEM Credem stock 1997 1998 1999 2000 2001 2002 2003 2004 2005 No. shares (/000) 225,839 253,408 265,464 270,679 272,537 273,309 274,350 275,417 278,605 Net equity per share 2.07 2.34 2.27 2.55 2.86 3.08 3.23 3.64 4.00 Earnings per share 0.22 0.26 0.17 0.51 0.39 0.40 0.35 0.52 0.90 ROE 11.6% 13.5%
Slide 8: Business areas
CREDEM Business areas Commercial Banking Wealth Management Investment Banking Other CREDEM 100% 98.5% 50% 100% 100% * Life insurance 100% 100% 50% 59.5% 100% * FIDUCIARIA Spa Insurance 100% * na 100% 100% * 100% 100% 100% 100% * Not consolidated 8 March ‘06
Slide 9: Network, market shares and staff
CREDEM Network, market shares and staff No. of CREDEM Group branches as at 31 December 2005 1 64 15 17 Network FY05 FY04 6 128 Credem and others 433 441 B.ca Euromobiliare 22 22 10 4 Branches 455 463 3 Business centres 40 39 3 18 Credem Points 24 24 1 1 50 42 Banca Euro financial stores 22 21 2 Staf
Slide 10: Group Profile, Results, History & Planning
CREDEM • Group Profile • Results • History & Planning 10 March ‘06
Slide 11: FY05 Results
CREDEM FY05 Results FY04 IAS compliant Total income Cont’d Operating costs 1,200 800 1,050 945.4 700 +15.9% 586.4 +8.6% 900 815.6 600 539.9 750 500 216.1 EURm EURm 569.7 209.6 +3.1% 600 +14.2% 400 498.7 450 300 300 200 370.3 375.7 330.3 +12.1% 150 316.9 +18.6% 100 0 0 FY04 FY05 FY04 FY05 Net interes
Slide 12: FY05 Results (cont'd)
CREDEM FY05 Results FY04 IAS compliant Total direct loans (net of repos) Cont’d Deposits & funding (net of repos) 16 14 80 12 70 +8.6% 55.3 +9.8% 60 50.4 Euro bln 10 50 EURbn 8 Mkt +8.1% 40 25.0 +8.7% 6 11,6 12,6 23.0 4 30 18.0 +13.2% 2 20 15.9 0 10 +7.2% 11.5 12.4 FY04 FY05 0 FY04 FY05 Cash Direct
Slide 13: Revenues growing
CREDEM Revenues growing FY04 IAS compliant EURm FY04* FY05 % yoy Net Interest Income 316.9 375.7 18.6% Commercial spread 3.02% 3.18% +16 bps Net fee and commission income 376.4 414.7 10.2% Net interest income has improved by 18.6%. The spread - of which: management and brokerage 266.2 302.5 13.6%
Slide 14: P&L
CREDEM P&L FY04 IAS compliant EURm FY04 FY05 % yoy Net interest income 316.9 375.7 18.5 Personnel expenses increase also because of incentive plans Non interest income 498.7 569.7 14.2 provisions, as 2005 group’s performance has been extremely good. Total Income 815.6 945.4 15.9 Payroll -330.3 -370.
Slide 15: Importance of core business
CREDEM Importance of core business FY04 IAS compliant Contribution to EBIT 2005 EURm Core business companies Other companies Total income 87% 13% Operating costs 89% 11% EBIT 84% 16% The diversification of the Group’s activities and the focus on “core” businesses have helped generate significant pro
Slide 16: Inflows and AUM doing well
CREDEM Inflows and AUM doing well FY04 IAS compliant Customers funding EURm FY04 FY05 % yoy Net inflows for the year 2005 were about € 2.2 billion. All Deposits 7,787 8,622 10.7% commercial channels and types of product contributed to the Bonds 3,743 3,738 -0.1% acquisition of new resources. Total
Slide 17: Home mortgage loans heading up
CREDEM Home mortgage loans heading up FY04 IAS compliant Customers loans EURm FY04 FY05 % yoy The increase has been sustained by all “core” segments (Private, Short Term Loans 6,043 6,441 6.6% Small and Middle Corporate). Long Term Loans 3,837 4,441 15.7% Leasing 1,690 1,719 1.7% Repos 92 117 27.2%
Slide 18: Reducing large corporate exposure
CREDEM Reducing large corporate exposure FY04 IAS compliant Loans breakdown by customer segments EURm % change Breakdown by business unit FY03 FY04 FY05 FY05 – FY03 Top 20 borrowers FY03 FY04 FY05 Corporate 5,876 5,219 5,221 -11.1% (Corporate – EUR/m) - % of total 52 45 41 - large corporate 2,568 1,
Slide 19: Excellent loan quality
CREDEM Excellent loan quality FY04 IAS compliant • Credit quality consistently high, with an NPL ratio of 0.18% (0.28% at December '04) 5,0 4,5 Breakdown of loans by rating FY03 FY04 FY05 4,0 (%) 3,5 Normal risk 94.5 94.8 94.2 3,0 Under observation 4.7 4.4 5.1 2,5 Problem loans 0.8 0.8 0.7 2,0 1,5 1
Slide 20: Risks under control
CREDEM Risks under control Market risk (EUR/m) FY04 FY05 Credem - average 5.2 1.6 • Market risk management mostly pertains to Credem, Abaxbank and Euromobiliare SIM - maximum 11.0 2.4 Abaxbank • Overall risks are modest and fairly stable over time.. - average 3.3 1.1 - maximum 6.1 2.5 Other companie
Slide 21: Group Profile, Results, History & Planning
CREDEM • Group Profile • Results • History & Planning 21 March ‘06
Slide 22: History
CREDEM History • 1910 The bank was established as Banca Agricola Commerciale di Reggio Emilia (Emilia Romagna) • 1983 The bank acquired the current denomination of Credito Emiliano S.p.A. (Credem) and acquired Banca Belinzaghi di Milano, the first significant step taken towards the expansion at a na
Slide 23: 2004-2006 business plan: Strategy
CREDEM 2004-2006 business plan Strategy Central role of the core business • Commercial banking with strong wealth management • Focus on RETAIL customers of medium-high standing, small business and SMEs • To extract VALUE from acquired potential • After few years of sustained growth, the Group intend
Slide 24: 2004-2006 business plan: Drivers and Actions
CREDEM 2004-2006 business plan Drivers Actions • Rationalisation of the branches network with stronger focus on efficiency Target development with focus on profit • Improvement of customers potential and retention through CRM and cross selling • Strengthening of wealth management as flagship busines
Slide 25: 2006 targets
CREDEM 2006 targets Total income Cont’d Operating costs 1,200 CAGR 800 CAGR 1,005 7.1% 700 606 5.1% 900 819 600 522 500 237 EURm EURm 633 600 7.4% 208 4.3% 511 400 300 300 200 369 372 314 308 6.5% 100 5.6% 0 0 FY03 FY06E FY03 FY06E Net interest income Non-interest income Payroll costs Admin. expense
Slide 26: 2006 targets (cont'd)
CREDEM 2006 targets Distribution channels Cont’d Deposits & collections CAGR Market 600 80 8.6% 57 +3 68 54 500 38 43 +5 60 53 400 28.2 5.8% EURbn 300 40 23.8 462 473 +11 22.2 200 14.8 14.4% 9.8% 20 100 17.6 14.5 6.7% 4.5% 0 0 FY03 FY06E FY03 FY06E Branches Corporate centres Points & shops Direct AU
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