Slide 1: Earnings Conference Call First Quarter 2019
Earnings Conference Call First Quarter 2019
Slide 2: In the News
In the News External Environment: changes compared to the last Conference Call Tailwinds Headwinds Factors to watch ▪ Ongoing advance of mining ▪ Estimated GDP growth at ▪ Developments in Las investment around 2.5% YoY in 1Q19: Bambas mining unit. ▪ Double-digit growth rates in ▪ Contraction of prim
Slide 3: Economic Environment
Economic Environment Table 1: IMF world economic forecasts (% change) (1) Chart 1: Peru: Total GDP and Non-primary GDP 2019 (% change YoY) (2) Economies 2018 GDP: 1Q19E vs 1Q18 Jan-19 Apr-19 8.0 ▲2.3% World 3.6 3.5 3.3 GDP Non-Primary GDP 7.0 Non-Primary GDP: Advanced 2.3 2.0 1.8 1Q19E vs 1Q18 ▲3.3%
Slide 4: Overview - Credicorp's Lines of Business (LoBs)
Overview - Credicorp’s Lines of Business (LoBs) Universal Banking Microfinance Stand-alone Bolivia 1Q19 Contribution(1) 74.1% 1.1% 1Q19 Contribution(1) 9.0% 0.2% 1Q18 22.9% 11.8% 1Q18 30.6% 4.2% ROAE 4Q18 19.4% 13.5% ROAE 4Q18 21.4% 13.3% 1Q19 22.5% 7.4% 1Q19 21.3% 12.4% BCP Stand-alone: + Loan grow
Slide 5: Quarterly highlights
Quarterly highlights QoQ YoY Net income: S/ 1,101 million ▲ 15.0% ▲ 6.1% Profitability ROAE: 18.5% ▲ 220 bps ▼ -80 bps ROAA: 2.5% ▲ 30 bps ▲ 10 bps Quarter-end balances: S/ 108.4 billion ▼ -2.2% ▲ 7.7% Average daily balances: S/ 107.6 billion ▼ -0.5% ▲ 7.2% Loan portfolio Net provisions for loan los
Slide 6: Interest-earning assets
Interest-earning assets Chart 1: Interest-Earning Assets (S/ billion – quarter-end balances) 0.0% ▲3.0% QoQ YoY Total loans contracted QoQ due to cancelation of short-term loans in Wholesale Banking and seasonality, but YoY loan Total Loans ▼ -2.2% QoQ expansion was driven by higher- 63.5% 68.0% 66
Slide 7: Funding Structure and Funding Cost
Funding Structure and Funding Cost Chart 1: Evolution of Funding Structure Chart 2: Deposits by type (S/ billion- quarter-end balances) (S/ billion- quarter-end balances) ▲ 2.3% ▲ -1.9% 160, 000 , 000 YoY QoQ 104.6 104.6 103.7 103.7 136.3 133.7 98.2 98.2 130.7 Demand 140, 000 , 000 Demand depo depos
Slide 8: Net Interest Income (NII)
Net Interest Income (NII) Net 1Q18 4Q18 1Q19 QoQ YoY Interest Income 2,043 2,244 2,189 -2.5% 7.1% (S/ million) Chart 1: Interest Income in LC Chart 2: Interest Income in FC (S/ Million) (S/ Million) NII generation was favored by loan expansion, mainly in 2.238 3.9% Retail Banking segments 2.136 2.2
Slide 9: Cost of risk
Cost of risk(1)(2) Chart 1: Evolution of Chart 2: Evolution of Cost of Risk 4Q18 vs 1Q19 Cost of Risk 1Q18 vs 1Q19 -6 bps QoQ in the Cost of risk -7 bps YoY in the Cost of risk 1.47% 1.41% 1.48% 1.41% Cost of BCP Mibanco Other Cost of Cost of BCP Mibanco Other Cost of risk risk risk risk 4Q18 1Q19 1
Slide 10: Delinquency and Coverage ratios
Delinquency and Coverage ratios Chart 1: Evolution of Delinquency ratios 4.41% 4.49% 4.42% 4.47% Adjusted NPL ratio (1) 4.26% 4.22% 4.03% NPL ratio 4.15% 4.09% 4.09% 3.97% 3.92% 3.88% 3.40% 3.27% 3.65% 3.30% 3.28% NPL over 90-days ratio 3.17% 3.10% 3.02% IOL (2) ratio 3.00% 2.98% 3.03% 3.04% 2.91% 2
Slide 11: Risk-adjusted NIM
Risk-adjusted NIM Annual evolution Recovery in Risk-Adjusted NIM 2018-2019 0.06 0.05 5.52% 5.64% 5.28% 5.37% 5.16% 0.04 4.48% 4.62% 4.43% 4.22% 4.39% 0.03 0.02 0.01 1.67% 1.48% 1.47% 1.41% 1.22% 0 1Q18 2Q18 3Q18 4Q18 1Q19 NIM Risk-adjusted NIM Cost of Risk 11
Slide 12: Non-Financial Income
Non-Financial Income Chart 1: Non-financial income YoY evolution (S/ million) +5.8% 1Q19 vs 1Q18 Chart 2: Fee income and Net gain on FX Transactions YoY evolution (S/ million) ▲14.4% 961 ▲7.6% 912 836 847 ▲5.4% 162 178 165 166 Share of 82% of total Non-Financial income 750 783 (as of 1Q19) 671 681 1
Slide 13: Operating Efficiency
Operating Efficiency Chart 1: Efficiency ratio YoY evolution by income/expense IFRS16: 1.0% IFRS16: 0.2% IFRS16: -1.4% IFRS 16 effect on net income: S/ 0.0 BCP Stand-alone: -1.5% IFRS 16 effect on PGA: -0.9% efficiency ratio: BCP Stand-alone: 0.7%, Mibanco: 0.4% -20 pbs Chart 2: Efficiency ratio YoY
Slide 14: Mibanco
Mibanco Net interest income YoY evolution by income/expense (S/ million) Downward pressure in interest rates due to Increase in funding cost in competition line with Retail funding strategy Efficiency ratio YoY evolution by income/expense Aggresive Competition Relocation expenses Transformation Stra
Slide 15: Transform plans into reality
Transform plans into reality Savings and credit cards digital onboarding WOW! DIGITAL TRANSFORMATION 726K Yape users 2014 2015 2016 2017 2018 1Q19 15
Slide 16: Customer Consumer segment
Customer Consumer segment 16
Slide 17: Digital transformation initiatives
▪ Yape ▪ Digital labs ▪ Digital Marketing ▪ Customer journeys ▪ Next-gen architecture ▪ Data architecture ▪ IT infrastructure optimisation ▪ Advanced Analytics ▪ Cloud, APIs, and Ecosystems ▪ Big Data labs ▪ Efficiency ▪ Digitization and automation of operating processes ▪ Change Management ▪ Talent
Slide 18: "People Ready" Organization "Tech Ready"
“People Ready” “Tech Ready” Organization Agility Architecture Infrastructure Specialization and Higher frequency Tech enabler Available and technical proficiency and value deliveries reliable systems • Value driven prioritization of resources • Accountability Efficiency “Cost/Value Conscious” 18
Slide 19: Consumer segment branch optimization and digital channels
▪ Boosting sales framework and ▪ Optimizing branch formats and ▪ Promoting digital education customers’ interactions based on footprint data ▪ Developing digital journeys for sales, ▪ Migrating customer interactions to servicing and transactions ▪ Applying advanced analytics as main alternative and
Slide 20: Retail Banking and Wholesale Banking market positioning
Retail Banking Retail Banking Wholesale Banking Consumer segment 47% 78% 80% 75% 74% 73% 72% 67% 70% 44% 70% 39% 39% 38% 58% 38% 67% 67% 58% 34% 64% 48% 49% 47% 31% 35% 45% 60% 44% 38% 28% 35% 35% 45% 27% 57% 31% 25% 34% 23% 23% 2016 2017 2018 Q1 2019 2016 2017 2018 Q1 2019 2016 2017 2018 Consumer B
Slide 21: Guidance FY 2019
Guidance FY 2019 2019 Macroeconomic indicators FY Guidance Real GDP growth % (1) ≈3.7% Domestic demand real growth% (1) ≈3.8% Private investment growth % (1) ≈5.3% BCRP reference rate year-end 2.75% (1) Inflation % 2.3% Exchange rate Year-end ≈3.35% - 3.40 2019 1Q19 Credicorp FY Guidance Results Loa
Slide 22: Safe Harbor for Forward-Looking Statements
Safe Harbor for Forward-Looking Statements This material includes “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934. All statements other than statements of historical information provided herein are forward-looking and may contain information abou