Deutsche Pfandbriefbank Ag · XETR:PBB
Deutsche Pfandbriefbank — Debt Investor Presentation (March 2022)
31 slides from Deutsche Pfandbriefbank's debt investor presentation, Mar 9, 2022
Slide 1: Debt Investor Update based on full year 2021 results
pbb Deutsche Pfandbriefbank Debt Investor Update based on full year 2021 results Please think about the environment before printing!
Slide 2: Disclaimer
Disclaimer This presentation is not an offer or invitation to subscribe for or purchase any securities in any jurisdiction, including any jurisdiction of the United States. Securities may not be offered or sold in the United States absent registration or pursuant to an available exemption from reg
Slide 3: Business Model & Strategy
Business Model & Strategy pbb is a leading commercial real estate lender with a complementary public investment finance business USPs Key figures (IFRS, 31/12/2021) Specialised on-balance sheet lender with extensive placement capabilities Strong franchise with long-standing client relationships
Slide 4: Operating and financial overview
Operating and financial overview New business Q4 Net interest and commission income 1 Q4 General and admin. expenses Q4 € bn (commitments, incl. extensions >1 yr) Q3 € mn (IFRS) Q3 € mn (IFRS) Q3 Q2 Q2 43% 42% Q2 40% Q1 Q1 CIR Q1 9.3 9.1 482 502 219 464 202 204 2.1 7.4 127 3.3 119 126 59 68 61 2.6 3
Slide 5: Ukraine/Russia crisis – impact on pbb
Ukraine/Russia crisis – impact on pbb No direct exposure in/to Ukraine and Russia – but uncertainties on overall economic impacts pbb – Status quo & Challenges Market impacts No direct exposure in/to Ukraine and Markets Russia (country of risk) Indirect risks from resp. countries only Length and s
Slide 6: REF new business
New business Strong REF new business volume of € 9.0 bn above full-year guidance of € 7-8 bn in further challenging environment REF New business REF new business € bn (commitments, incl. extensions >1 yr) FY20 9M/21 FY21 27.1 27.0 27.6 Financing Total volume (€ bn) 7.3 5.7 9.0 volume thereof: 9.0 9.
Slide 7: Portfolio
Portfolio Business approach reflected in stable risk parameters and low average LTV of 52%, which provides solid risk buffer – NPLs remain on low level REF Portfolio: Avg. weighted LTVs Non-performing loans % (commitments)1 € mn (EaD, Basel III) Workout2 Restructuring3 64% 0.9% 1.0% 1.0% 0.9% NPL 0.
Slide 8: Risk Provision
Risk Provision Risk provisioning significantly down y-o-y – solid buffer to cope with potential further market risks Net income from risk provisioning Key drivers Q4/12M 2021 € mn Net income from risk provisioning of € -81 mn (FY 2020: Q4/20 Q4/21 12M/20 12M/21 € -126 mn) – previous year strongly
Slide 9: Funding
Funding Strong funding activities focused on non-Euro Pfandbriefe and “Green” Senior Preferred – funding optimised with TLTRO III New long-term funding1 € bn Funding Q4/12M 2021 Solid Pfandbrief funding with focus on foreign currencies 2020: € 3.6 bn4 2021: € 5.1 bn4 USD 750 mn Pfandbrief GBP
Slide 10: Funding: Own Funds and Eligible Liabilities exceed 8% TLOF
Funding Own Funds and Eligible Liabilities significantly exceed 8 % TLOF (in € bn as of 31/12/2021)1) Composition of MREL2 Liabilities Rundown (31/12/2021) (31/12/2021) Substantial buffer for Senior Preferred (SP) investors due to high volume of ~ 15.5 capital instruments and Senior Non- Preferred
Slide 11: Capital
Capital Capitalisation remains strong – RWA reduction mainly reflecting RWA relief according to CRR II (reduction of add-ons) in Q4/21 Basel III: RWA RWA development Q4/12M 2021 € bn (IFRS) RWA down y-o-y due to 18.1 Reduction of add-ons acc. to Art. 501 CRR II4 17.7 Maturity effects and techn
Slide 12: Initiatives
Initiatives Taking advantage of pbb’s strengths in building out business, based on core competencies, market reach and risk profile Initiatives Key measures Impact Product expansion Widened product portfolio allows broader, diversified (Loan-on-loan, non-senior lending) risk-return combinations ~32*
Slide 13: Contact details
Contact details Funding / Debt Investor Relations Götz Michl +49 (0)6196 9990 2931 Goetz.Michl@pfandbriefbank.com Silvio Bardeschi + 49 (0)6196 9990 2934 Silvio.Bardeschi@pfandbriefbank.com Funding Desk Funding@pfandbriefbank.com Webpage: www.pfandbriefbank.com/investors/debt-investors.html
Slide 14: Appendix
Appendix pbb Deutsche Pfandbriefbank AG, March 2022 (IFRS, pbb Group, audited, approval from the Supervisory Board pending) 14
Slide 15: Impact of initiatives
Impact of initiatives Conservative risk positioning provides room to maneuver for new strategic growth initiatives Outlook 2024/25 stable REF pbb maintains a stable risk profile, beneficial diversification Non-senior portfolio characteristics help to reduce overall risk 53% 52% 52% Green financing
Slide 16: Guidance 2022 and mid-term ambition
Guidance 2022 and mid-term ambition Sustainable PBT level in 2022 despite income headwinds and investments to achieve growth ambition 2024/25 – uncertainties from geopolitical situation Financials (€ mn) 2020 2021 Guidance 2022 Ambition 2024/2025 PBT of € 200-220 mn in line with past 1 Organic growt
Slide 17: Key figures pbb Group
Key figures pbb Group Income statement (€ mn) 2019 Q1/20 Q2/20 Q3/20 Q4/20 2020 Q1/21 Q2/21 Q3/21 Q4/21 2021 Net interest income 9 9 9 9 458 111 116 125 124 476 123 123 123 125 494 Net fee and commission income 6 2 1 1 2 6 2 3 1 2 8 Net income from fair value measurement -7 -17 1 4 4 -8 2 0 1 7 10 N
Slide 18: ESG – Set-up & Strategy (1/3)
ESG – Set-up & Strategy pbb’s ESG set-up and strategy provide for holistic approach (1/3) Overall governance framework with high standards applied Law-abiding conduct, responsible corporate governance and adherence to ethical principles considered essential prerequisites General governance fra
Slide 19: ESG – Set-up & Strategy (2/3)
ESG – Set-up & Strategy pbb’s ESG set-up and strategy provide for holistic approach (2/3) Sustainability defined as self-conception, that own actions Self- provide an essential contribution to securing long-term future and conception to consider the consequences for all stakeholders and the enviro
Slide 20: ESG – Set-up & Strategy (3/3)
ESG – Set-up & Strategy pbb’s ESG set-up and strategy provide for holistic approach (3/3) Given pbb’s business model, inter alia strong focus on Sustainable Finance and contribution to a more climate- efficient real estate sector – pbb aims to be a transformation partner for its clients Systemat
Slide 21: ESG – Sustainable Finance
ESG – Sustainable Finance pbb Green Loan Framework aligned with current regulatory and market developments – specific metrics defined for each criteria pbb Scoring Model EU Taxonomy MAX SCORE: 100 Points III. Additional I. Energy Efficiency II. Building Certification Sustainability Factors • Energy
Slide 22: ECB stress test 2021
ECB stress test 2021 Stress test results demonstrate pbb’s resilience to crisis and capital strength Stress test result 2021 Max. CET 1 ratio depletion in adverse scenario (pp.) / Min. CET 1 ratio (%) ECB stress test result 2021 demonstrates pbb‘s resilience to crisis and capital strength In the
Slide 23: CRE Markets
CRE Markets Investment volumes are on pre-Covid-19 level again in Europe – at all-time high in the US European and US Investment volume1 (€ bn) European and US CRE investment volumes showing strong 800 € performance in Q4/21 700 € Quarterly US figures were far above the pre-pandemic trend Euro
Slide 24: Markets Sub-segments
Markets Sub-segments Property Regions Evaluation of current situation Challenges Risk positioning type Shopping centres: increased pressure, Short Term: threads to income Selective approach with foresighted fashion dominated shopping centres stability in some countries could reduction of retai
Slide 25: Markets Sub-segments
Markets Sub-segments Property Regions Evaluation of current situation Challenges Risk positioning type Slight rise in vacancies but still on Financial difficulties of tenants / Focus on good locations comparatively low levels insolvencies expected to increase Conservative risk positioning: S
Slide 26: Portfolio
Portfolio Stable and well diversified portfolio with continued focus on European markets, particularly on Germany 31/12/2021 (EaD, Basel III) Real Estate Finance Public Investment Finance Value Portfolio Finland 1% Other Europe 3% Finland <1% Other Other Rest Austria 1% Other Europe UK 3% Other Rest
Slide 27: REF Portfolio: Shift in composition
REF Portfolio Shift in composition 31/12/2013 / Total: € 22.2 bn1 31/12/20152 / Total: € 25.8 bn1 31/12/2021 / Total: € 29.7 bn1 Regions Czech Republic 1% Other 6% Other 5% Other Europe Nordics Nordics Austria 2% 6% 7% Sweden 3% 10% France CEE 9% Poland 4% 8% Germany 47% Germany 47% Germany CEE 9% 5
Slide 28: Cover Pools: ISCR and Mortgage Lending Value
Cover Pools ISCR and the effect of the Mortgage Lending Value – very simplified example! Interest Service Cover Ratio Loan - to - Value Ratio Loan Valuation Refinancing MV € 100 mn Borrower’s Difference Equity e.g. 35% € 45 mn € 4.0 mn rent p.a. at 4% property yield results in a market value of € 10
Slide 29: Mortgage Pfandbrief Cover Pool
Cover Pools Mortgage Pfandbrief Cover Pool Mortgage cover pool (nominal) 30/09/2021 31/12/2021 Pfandbriefe outstanding € 16.3 bn € 16.4 bn Cover funds € 19.7 bn € 19.3 bn Over-collateralisation (Nominal/NPV) 20.8% / 21.2% 17.1% / 17.5% No. of loans 1,733 1,661 No. of properties 3,180 3,038 Payments
Slide 30: Public Sector Pfandbrief Cover Pool
Cover Pools Public Sector Pfandbrief Cover Pool Public Sector cover pool (nominal) 30/09/2021 31/12/2021 Pfandbriefe outstanding € 10.5 bn € 10.2 bn Cover funds € 11.7 bn € 11.4 bn Over-collateralisation (Nominal/NPV) 10.7 % / 11.6 % 12.2 % / 13.5 % No. of loans 533 523 Payments ≥ 90 days overdue -
Slide 31: Mandated Ratings
Mandated Ratings Bank ratings S&P Long-term BBB+ Outlook/Trend Stable Short-term A-2 Stand-alone rating1 bbb- Long Term Debt Ratings “Preferred” senior unsecured Debt2 BBB+ “Non-preferred” senior unsecured Debt3 BBB- Subordinated Debt BB+ Pfandbrief ratings Moody’s Public Sector Pfandbrief Aa1 Mortg
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