Raiffeisen Bank International Ag · VIE:RBI
Raiffeisen Bank International — Q1 2018 Earnings Presentation
56 slides from Raiffeisen Bank International's earnings presentation, May 15, 2018
Slide 1: Raiffeisen Bank International Investor Presentation
Raiffeisen Bank International Investor Presentation
Slide 2: Disclaimer
Disclaimer Certain statements contained herein may be statements of future expectations and other forward-looking statements about Raiffeisen Bank International AG (“RBI”) and its affiliates, which are based on management's current views and assumptions and involve known and unknown risks and uncert
Slide 3: Table of Contents
Table of Contents Executive Summary . . . . . . . . . . . . . . . . . 3 Financials . . . . . . . . . . . . . . . . . . . . . . . 12 Risk Management . . . . . . . . . . . . . . . . . . 22 Appendix . . . . . . . . . . . . . . . . . . . . . . . 26 Group Investor Relations May / June 2018 3
Slide 4: Executive Summary Q1/2018
Executive Summary Q1/2018 Consolidated profit of EUR 399 mn (up 81% year-on-year) driven by strong positive contribution from risk costs Exceptionally high net releases of loan loss provisions led to positive impairment losses on financial assets (risk costs). Despite the positive result, risk costs
Slide 5: Financial Highlights Q1/2018
Financial Highlights Q1/2018 In EUR mn Q1/2018 Q4/2017 q-o-q Q1/2017 y-o-y Net interest income 829 818 1.3% 797 4.0% Net fee and commission income 410 446 (8.2)% 409 0.1% Net trading income and fair value result (1) 10 – 2 – Operating income 1,291 1,278 1.0% 1,253 3.0% Profitability General administ
Slide 6: Development of Financial Ratios in Q1/2018
Development of Financial Ratios in Q1/2018 RoE (Consolidated)1 Cost/Income Ratio 16.2% 16.6% 62.5% 14.0% 12.2% 59.5% 59.1% 58.4% 9.6% 57.3% 8.9% 55.9% Q1/2017 Q2/2017 Q3/2017 Q4/2017 FY/2017 Q1/2018 Q1/2017 Q2/2017 Q3/2017 Q4/2017 FY/2017 Q1/2018 Net Interest Margin1 Provisioning Ratio1 0.63% 2.55%
Slide 7: Growth across the Group
Growth across the Group Q1/2018 Loans1 Projected Loan Growth2 Projected Loan Growth2 Q1/2018 Loans1 Albania Kosovo EUR 699 mn EUR 565 mn Belarus EUR 894 mn Romania EUR 4,956 mn Bosnia & Herzegovina EUR 1,209 mn Russia EUR 8,146 mn Bulgaria EUR 2,343 mn Serbia Croatia EUR 1,244 mn EUR 2,422 mn Slovak
Slide 8: Update on Poland
Update on Poland Agreement to sell core banking operations of Raiffeisen Bank Polska to Bank BGZ BNP Paribas; expected to close in Q4/2018 Sales price of approximately EUR 775 mn equal to preliminary multiple of around 0.95 times tangible book value Sale of Core Bank Approximately 90 bps positive im
Slide 9: Update on Russia
Update on Russia Key Developments Strategy We will look to grow across all business segments while maintaining Loan growth of 2% in Q1/2018 in EUR terms our prudent risk approach Net interest margin increased to 5.95% in Q1/2018 (from 5.43% in Retail market: expanding the private individual customer
Slide 10: Macro Outlook
Macro Outlook Development of Real GDP (%) General Market Trends Country 2016 2017 2018e 2019f Business cycle dynamics in Central Europe (CE) likely to CE Czech Republic 2.5 4.6 3.5 3.2 remain healthy in 2018, despite a softening in business Hungary 2.2 4.0 3.8 3.2 sentiment from multi-year highs at
Slide 11: Outlook and Targets
Outlook and Targets We will pursue loan growth with an average yearly percentage increase in the mid-single digit area Impairment losses on financial assets (risk costs) in 2018 are expected to be around the 2017 level We anticipate that the NPL ratio will further reduce in the medium term We aim to
Slide 12: Table of Contents
Table of Contents Executive Summary . . . . . . . . . . . . . . . . . 3 Financials . . . . . . . . . . . . . . . . . . . . . . . 12 Risk Management . . . . . . . . . . . . . . . . . . 22 Appendix . . . . . . . . . . . . . . . . . . . . . . . 26 Group Investor Relations May / June 2018 12
Slide 13: Overview of Key Financials
Overview of Key Financials Q1/2018 Q4/2017 q-o-q Q1/2018 Q1/2017 y-o-y Development (q-o-q) In EUR mn Net interest income 829 818 1.3% 829 797 4.0% Net interest income up EUR 11 mn mostly due to increases in Czech Republic (up EUR 6 mn) and Net fee & commission income 410 446 (8.2)% 410 409 0.1% Roma
Slide 14: Distribution of Profit before Tax – Q1/2018
Distribution of Profit before Tax – Q1/2018 In EUR mn 4.8% 52.5% 37.0% – 80.1% 70.0% ∆ q-o-q 154 (146) 248 529 142 130 Central Europe Southeastern Eastern Europe Group Corporate Center RBI Group 1 1 Europe Corporates & Markets & Reconciliation Czech Republic Albania Belarus Corporates Vienna Group T
Slide 15: Revenue Composition
Revenue Composition Split of Operating Income Development (q-o-q) In EUR mn 1,296 1,278 1,291 Net interest income up EUR 11 mn mostly due to 1,253 42 1,270 4 45 29 53 increases in Czech Republic (up EUR 6 mn) and 2 26 (1) 10 (1) 429 446 410 Romania (up EUR 4 mn); in Q1 NIM decreased 409 433 6BP to 2
Slide 16: Expense Base Breakdown
Expense Base Breakdown Development of General Administrative Expenses Development (q-o-q) In EUR mn General administrative expenses down EUR 58 758 798 mn driven by lower other administrative 745 710 740 75 75 expenses and lower staff expenses 76 74 70 280 292 315 286 271 Staff expenses down EUR 24
Slide 17: Balance Sheet Overview
Balance Sheet Overview Balance Sheet (31/03/2018) In EUR mn 31/03/2018 31/12/2017 q-o-q 31/03/2018 31/03/2017 y-o-y Total assets 140,033 135,146 3.6% 140,033 138,489 1.1% EUR 140 bn 20% 9% Loans to banks 10,386 10,741 (3.3)% 10,386 7,442 39.5% 12% 15% Loans to customers 80,226 77,745 3.2% 80,226 76,
Slide 18: RBI Group IFRS 9 Impact on Equity
RBI Group IFRS 9 Impact on Equity IAS 39 IFRS 9 RBI applied IFRS 9 for the first time on 1 January 2018 Financial assets Carrying Carrying Reclassifications Remeasurements in EUR mn Amount Amount 31.12.2017 1.1.2018 The total pre-tax impact on the opening balance of RBI At amortized cost 96,307 19 (
Slide 19: Regulatory Capital Overview
Regulatory Capital Overview Regulatory Capital Structure Changes in Regulatory Capital (YTD) In EUR mn 31/03/2018 31/12/2017 Common equity tier 1 capital down by EUR 330 mn to EUR 8,936 mn mainly due to IFRS 9 effects and full application of CRR transitional rules Common equity tier 1 (before deduct
Slide 20: Capital Ratios well above Requirements
Capital Ratios well above Requirements Group Capital Requirements Further Details (RBI Group) 2018 SREP P2R of 2.25%, and P2G of 1.0% (unchanged from Including 2017) Q1 results 17.9% Combined buffer requirement in 2018 of 2.96%: Including Q1 results 1.875% capital conservation buffer Including Regul
Slide 21: Funding Overview
Funding Overview Funding Structure (31/03/2018) NSFR and Loan/Deposit Ratio Non-financial Long-term 113% 113% corporations 111% 112% refinancing 110% 24% 16% 99% 98% 97% 95% 97% Short-term refinancing 25% Households Q1/2017 Q2/2017 Q3/2017 Q4/2017 Q1/2018 36% Total: EUR 126 bn Loan/deposit ratio NSF
Slide 22: Table of Contents
Table of Contents Executive Summary . . . . . . . . . . . . . . . . . 3 Financials . . . . . . . . . . . . . . . . . . . . . . . 12 Risk Management . . . . . . . . . . . . . . . . . . 22 Appendix . . . . . . . . . . . . . . . . . . . . . . . 26 Group Investor Relations May / June 2018 22
Slide 23: RWA and Credit Portfolio Development
RWA and Credit Portfolio Development RWA and Credit Portfolio Development Comments (q-o-q) In EUR mn Total Exposure Retail Non Retail Total Exposure RWA Change Credit risk RWA increased by EUR 1,206 mn 31/03/2018 31/03/2018 31/03/2018 Change (YTD) 31/03/2018 RWA (YTD) Non-retail: RWA increased by EU
Slide 24: NPL and Provisioning Ratio Development
NPL and Provisioning Ratio Development NPL as % of Customer Loans and NPL Coverage Ratio Comments Strong improvement in risk costs and NPL ratio due to NPL sales of EUR 135 mn and recoveries (incl. writebacks) of EUR 200 mn 74.0% NPL ratio down by 0.3PP to 5.4%; largest decrease in Southeastern 70.5
Slide 25: NPL Distribution by Country
NPL Distribution by Country NPL Ratio and Coverage Ratio Comments (YTD) In EUR mn NPL NPL NPL NPL NPL NPL down by EUR 130 mn due to NPL sales of EUR 135 Stock Ratio Ratio Coverage Ratio Coverage Ratio 31/03/2018 31/03/2018 31/12/2017 31/03/2018 31/12/2017 mn and recoveries (incl. writebacks) of EUR
Slide 26: Table of Contents
Table of Contents Executive Summary . . . . . . . . . . . . . . . . . 3 Financials . . . . . . . . . . . . . . . . . . . . . . . 12 Risk Management . . . . . . . . . . . . . . . . . . 22 Appendix . . . . . . . . . . . . . . . . . . . . . . . 26 Group Investor Relations May / June 2018 26
Slide 27: Geographic Footprint
Geographic Footprint Czech Republic, #5 Austria, #3 Central Europe (CE) Eastern Europe (EE) Loans: EUR 10.3 bn Loans: EUR 28.0 bn Southeastern Europe (SEE) Branches: 133 Branches: 19 Leading regional player with Hungary, #5 Russia, #9 CEE presence of over 30 years Loans: EUR 3.1 bn Loans: EUR 8.1 bn
Slide 28: Country and Segment Overview
Country and Segment Overview 1-3/2018 Total Assets Share of Total Assets2 Loan/deposit Net Interest Provisioning Ratio NPL Ratio NPL Coverage Ratio (EUR mn) Ratio Margin Czech Republic 16,343 11.7% 86.7% 2.06% 0.19% 2.3% 99.4% Hungary 7,258 5.2% 65.9% 1.96% (1.31)% 8.0% 72.4% Poland 11,191 8.0% 104.
Slide 29: RBI Group
RBI Group In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 829 818 1.3% 814 796 797 3,225 Net fee and commission income 410 446 (8.2)% 429 433 409 1,718 Net trading income and fair value result (1) 10 – (1) 26 2 37 Other net operating income 45 21 118.0% 19 22 38 1
Slide 30: Country Financials (CE) – Czech Republic
Country Financials (CE) – Czech Republic In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 82 76 8.0% 70 66 68 280 Net fee and commission income 33 36 (9.2)% 30 32 33 132 Net trading income and fair value result 0 6 (95.0)% 8 11 6 31 Other net operating income 3 5 (
Slide 31: Country Financials (CE) – Hungary
Country Financials (CE) – Hungary In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 34 33 3.0% 35 34 35 137 Net fee and commission income 31 34 (8.5)% 32 33 31 130 Net trading income and fair value result 5 0 >500.0% 1 0 1 3 Other net operating income (12) (14) (17.
Slide 32: Country Financials (CE) – Poland
Country Financials (CE) – Poland In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 64 66 (2.5)% 67 65 61 260 Net fee and commission income 32 35 (8.4)% 35 35 33 138 Net trading income and fair value result 5 2 119.9% 3 0 4 9 Other net operating income 1 8 (84.8)% (0
Slide 33: Country Financials (CE) – Slovakia
Country Financials (CE) – Slovakia In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 68 68 (0.3)% 73 64 69 274 Net fee and commission income 40 40 (0.2)% 40 38 39 157 Net trading income and fair value result 2 4 (38.7)% (3) 5 1 7 Other net operating income 0 (12) –
Slide 34: Country Financials (SEE) – Albania
Country Financials (SEE) – Albania In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 13 14 (3.7)% 14 14 14 56 Net fee and commission income 4 4 (3.8)% 4 4 4 15 Net trading income and fair value result (1) (1) 39.0% 0 (4) 3 (2) Other net operating income (0) 3 – 0 (0
Slide 35: Country Financials (SEE) – Bosnia & Herzegovina
Country Financials (SEE) – Bosnia & Herzegovina In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 16 17 (0.9)% 16 16 17 66 Net fee and commission income 10 10 0.3% 10 11 9 39 Net trading income and fair value result (1) 0 – 0 (0) (0) 0 Other net operating income 1 1
Slide 36: Country Financials (SEE) – Bulgaria
Country Financials (SEE) – Bulgaria In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 25 24 3.0% 25 26 26 101 Net fee and commission income 11 11 (4.2)% 12 11 10 45 Net trading income and fair value result 0 1 (47.4)% 1 0 1 3 Other net operating income 1 1 9.2% 1 1
Slide 37: Country Financials (SEE) – Croatia
Country Financials (SEE) – Croatia In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 30 30 2.1% 31 33 33 126 Net fee and commission income 15 16 (4.8)% 21 18 16 71 Net trading income and fair value result 2 (0) – (0) 2 2 4 Other net operating income 7 6 3.7% 2 3 7 1
Slide 38: Country Financials (SEE) – Kosovo
Country Financials (SEE) – Kosovo In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 10 10 2.0% 10 9 9 38 Net fee and commission income 2 3 (29.3)% 4 3 2 13 Net trading income and fair value result 0 (0) – (0) 0 0 0 Other net operating income 0 0 12.1% 0 0 0 1 Operat
Slide 39: Country Financials (SEE) – Romania
Country Financials (SEE) – Romania In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 75 71 5.4% 65 64 63 263 Net fee and commission income 44 49 (9.8)% 43 44 41 176 Net trading income and fair value result 3 0 >500.0% 3 5 4 12 Other net operating income 2 (4) – (0)
Slide 40: Country Financials (SEE) – Serbia
Country Financials (SEE) – Serbia In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 21 21 0.5% 21 20 20 81 Net fee and commission income 8 11 (25.0)% 11 10 9 41 Net trading income and fair value result 5 (0) – 2 1 1 4 Other net operating income 2 (2) – 1 1 1 2 Opera
Slide 41: Country Financials (EE) – Belarus
Country Financials (EE) – Belarus In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 22 22 2.5% 24 29 31 107 Net fee and commission income 11 13 (10.9)% 13 13 13 52 Net trading income and fair value result 1 1 (17.1)% 1 2 (1) 4 Other net operating income (0) 1 – (0)
Slide 42: Country Financials (EE) – Russia
Country Financials (EE) – Russia In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 176 182 (3.2)% 166 173 168 688 Net fee and commission income 73 82 (11.6)% 77 82 75 317 Net trading income and fair value result 2 12 (82.6)% 1 17 16 46 Other net operating income 8 (
Slide 43: Country Financials (EE) – Ukraine
Country Financials (EE) – Ukraine In EUR mn Q1/2018 Q4/2017 q-o-q Q3/2017 Q2/2017 Q1/2017 FY/2017 Net interest income 49 48 3.1% 48 47 46 188 Net fee and commission income 20 24 (15.1)% 25 23 21 93 Net trading income and fair value result 3 (3) – (1) 3 4 3 Other net operating income 1 1 (40.0)% 1 1
Slide 44: Bank Levies and Resolution Fund
Bank Levies and Resolution Fund Impact in EUR mn FY 2017 Q1 2018 FY 2018e Bank levy based on total assets (excluding derivatives) and Austria including a one-off payment (spread over 4 years) of EUR 163 mn 57 451 ~56 from 2017 on Bank levy of 0.15% (for up to HUF 50 bn of total assets) and 0.21% Hun
Slide 45: Equity Overview
Equity Overview Subscribed Capital Retained Non-controlling Total In EUR mn capital reserves earnings Consolidated equity interests AT1 capital Equity Equity as at 31/12/2017 1,002 4,992 3,943 9,937 660 645 11,241 Impact of adopting IFRS 9 0 0 (122) (122) (7) 0 (130) Equity as at 01/01/2018 1,002 4,
Slide 46: NPL and NPE Distribution by Country
NPL and NPE Distribution by Country NPE NPE NPE Coverage NPE Coverage NPL NPL NPL Coverage NPL Coverage Ratio Ratio Ratio Ratio Ratio Ratio Ratio Ratio 31/03/2018 31/12/2017 31/03/2018 31/12/2017 31/03/2018 31/12/2017 31/03/2018 31/12/2017 Czech Republic 1.7% 2.0% 67.3% 60.6% 2.3% 2.6% 99.4% 86.6% H
Slide 47: FINREP: Changes to the Income Statement
FINREP: Changes to the Income Statement Summary of changes 1 Net interest income reconciliation in EUR million 2017 Notes Income statement (in EUR mn) 2017 new Notes Net interest income (old) 3,208 Net interest income 3,225 See table 1 New line in operating Dividends (35) Dividend income 35 income N
Slide 48: FINREP: Changes to the Balance Sheet
FINREP: Changes to the Balance Sheet in EUR million 2017 new EUR million 2017 old Change Loans to banks 10,741 Loans and advances to banks (less impairment losses) 14,347 (3,606) Loans to customers 77,745 Loans and advances to customers (less impairment losses) 78,141 (396) Securities 21,967 Financi
Slide 49: FINREP: Changes to Financial Ratios
FINREP: Changes to Financial Ratios Summary of Changes Ratios Net interest margin: Net interest income in relation to average interest bearing assets FY2017 new FY2017 old Change: Included: NII from trading book assets/liabilities (including derivatives) NIM 2.48% 2.48% Excluded: equity investments
Slide 50: Raiffeisen Banking Group Structure
Raiffeisen Banking Group Structure Raiffeisen Banking Group (RBG) – largest banking group in Austria Raiffeisen Banking Group (RBG) with total assets of EUR 286.0 bn as of 31/12/2017 Solid funding profile of RBG based on a domestic market share of ~1.7 mn1 members (mainly private individuals) around
Slide 51: The Institutional Protection Scheme (IPS)
The Institutional Protection Scheme (IPS) Legal Background IPS in Raiffeisen Austria IPS regulations are defined in the CRR Art. 113 (7); the IPS is subject to There are regional IPS in place. Members are the Raiffeisen banks and the regulatory supervision incl. regular reporting requirements region
Slide 52: Maturity Profile
Maturity Profile Maturity Profile at 31/03/2018 (in EUR mn) 1,656 564 1,140 1,149 273 920 276 500 152 753 746 639 589 550 174 520 433 546 816 867 650 486 425 515 193 500 475 335 55 196 36 153 54 40 11 24 10 20 99 89 68 7 96 40 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 203
Slide 53: AT1 and Subordinated Instruments
AT1 and Subordinated Instruments Regulatory Capital Initial Reset Nominal Issuance First Call Issuer Treatment1 Recognition2 ISIN Coupon Coupon outstanding date Date Call period Maturity 5Y EUR Raiffeisen Bank Additional Tier 1 99.4% XS1756703275 4.500% MidSwap + EUR 500 mn 17 Jan 2018 25 Jun 2025 S
Slide 54: Available Distributable Items (ADI) to Cover Discretionary Distributions
Available Distributable Items (ADI) to Cover Discretionary Distributions Distributable Items Available Distributable Items (EUR mn) Discretionary coupon payments on AT1 capital are subject to sufficient distributable items1 1,602 1,530 1,400 Distributable items based on RBI AG's unconsolidated accou
Slide 55: Shareholder Information Overview
Shareholder Information Overview General Information Shareholder Structure1 Listed since 25-04-05 on the Vienna Stock Exchange Prime Market Indices: ATX, ATX Prime, ATX five, MSCI Standard Index Europe, EURO STOXX Banks RBI free float 328,939,621 ordinary shares issued ~41.2% ISIN: AT0000606306 Trad
Slide 56: Contact and Financial Calendar
Contact and Financial Calendar Contact Details Financial Calendar Susanne E. Langer 11 June 2018 Record Date Annual General Meeting Head of Group Investor Relations 21 June 2018 Annual General Meeting Spokesperson 28 June 2018 Ex-Dividend Date Raiffeisen Bank International AG 29 June 2018 Record Dat
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