Eurobank S.A. · ATHEX:EUROB
Eurobank — Eurobank EFG — FY2007 Earnings Presentation
37 slides from Eurobank's earnings presentation, Feb 11, 2008
Slide 1: Full Year 2007 Results
SW-EUB022-2007-03-19-CMD-V7 February 11, 2008 Full Year 2007 Results
Slide 2: Positive macro environment supportive of business expansion
Page 2 Positive macro Environment supportive of Business Expansion Greek GDP growth remained robust - 2007e at 4.0%, 2008f at 3.7% Unemployment decreased to 8.3%, supporting household balance sheets - 2008f at 7.5% Budget Deficit at 2.9% of GDP –2008f at 2% Healthy credit expansion at 20.5%
Slide 3: 2007: Year of organisational consolidation and profitable business expansion
Page 3 2007: Year of organisational consolidation and profitable business expansion Completed acquisitions announced in 2006 (Ukraine, Turkey) that provide new platforms for business development Merged banks in Bulgaria Re-engineered Romanian operations Doubled Polish network, capturing 1.3%
Slide 4: Delivering outstanding results in 2007
Page 4 Delivering outstanding results in 2007 Strong credit demand across all categories - loans up 33.7% – Net loan additions of €11.8 bn for the year- record quarterly additions of € 3.5 bn Record deposit gathering - growth at 30.5% y-o-y – 4Q 07 deposit additions 7% higher than loan additions
Slide 5: Group networks at 1,523 branches and client servicing points
Page 5 Group networks at 1,523 branches and client servicing points – NE network at 963 units + 33% from last year FY 07 Networks Branches / Total network units 75/78 248/254 237/255 224/233 101/106 36 400/558 1 5
Slide 6: Loans grow 33.7% y-o-y to € 47 bn
Page 6 Loans grow 33.7% y-o-y to € 47 bn Total Lending Organic additions + 33.7% 46.7 3.8 3.1 34.9 9.3 2.5 3.5 + 142% 2.0 3.8 37.4 1.8 New Europe 1.6 1.3 1.2 + 20.4% 1.55 31.1 Greece Avg Q 06 1Q07 2Q07 3Q07 4Q07 FY 06 FY 07 Deposits Loans Household Lending Business Lending 24.8 21.8 + 36.7% + 30.5%
Slide 7: Deposits surge 30.5% to € 36.2 bn
Page 7 Deposits surge 30.5% to € 36.2 bn Acceleration of deposit gathering Deposit gathering momentum Net additions of € 8.4bn Record 4Q 07 with € 3.8 bn added group- wide + 30.5% 36.2 Robust Total AUM growth at 17.4% y-o-y +€3.8bn to € 52.4bn 32.4 New Europe AUM reach € 7 bn, up 60% 27.7 y-
Slide 8: New circumstances require a new strategy – already in place
Page 8 New circumstances require a new strategy – already in place Strong emphasis on deposit gathering has Loans / Deposits Ratio Evolution (%) significantly reduced the loan / deposits ratio € 4.2 bn of wholesale funding raised in 2007 130 including € 1bn EMTN renewals 127 Over €2 bn conting
Slide 9: New Europe
© Eurobank EFG New Europe
Slide 10: Accelerating NE profit growth
Page 10 Accelerating NE profit growth Operating income, € m Total regional investments at € 1.9bn – 638 +104% hedging of capital exposure where appropriate 313 Investment* Goodwill Bulgaria 417 189 Romania 240 10 FY 06 FY 07 Serbia 357 37 Poland 296 0 Net profits, € m Turkey 471 290 115.2 PAT (excl.
Slide 11: Profits of NE established operations at € 115m or 14% of total
Page 11 Profits of NE established operations at € 115m* or 14% of total Net profits per country Net profits contribution per quarter NE share of quarterly Group net profits Bulgaria 49.6 NE net profits, € m 28.8 Romania 14.3% Serbia 20.2 9.1% 31.2 21.5 Turkey 6.9% 19.7 -4.9 Cyprus 3.5% 14.7 Total* 1
Slide 12: Financial Review
© Eurobank EFG Financial Review
Slide 13: NII growth accelerates by 25.5% y-o-y
Page 13 NII growth accelerates by 25.5% y-o-y Highest quarter ever at € 560 m NII rises 8.4% q-o-q New Europe NII jumps 29.5% q-o-q – total contribution at 22.1% 560 +8.4% 517 482 445 382 427 150 + 106% y-o-y Total NII 342 352 322 312 116 Loan margin 99 New Europe 65 79 410 + 13% y-o-y 401 383 10 36
Slide 14: NIM at 3.28% despite 27% annual asset growth
Page 14 NIM at 3.28% despite 27% annual Asset growth FY 06 1Q 07 1H 07 9M 07 FY 07 Wide gap of Euribor vs ECB in 4Q Group NIM (%) 3.27 3.24 3.22 3.29 3.28 Gap on Dec. 12 95 bps 1 mnth Spreads in Greece 4Q 06 1Q 07 2Q 07 3Q 07 4Q 07 4.95 Sight & Savings Accounts 2.58 2.63 2.74 2.74 2.65 Time & Client
Slide 15: Fees surge 4.7% q-o-q and 25.7% for the year at € 634m
Page 15 Fees surge 4.7% q-o-q and 25.7% for the year at € 634m Strong lending fees up 88% y-o-y New Europe fees rise 117% y-o-y Network expansion boosts relevant fees by 34% y-o-y Capital markets fees expand 31% y-o-y Setting new quarterly record both in banking fees at € 149m and in total
Slide 16: Record quarterly operating income up 7%
Page 16 Record quarterly operating income up 7% - at € 2.8 bn, up 26.1% for the full year Operating Income Evolution NE doubles, contributing 23% to total 764 +7% 714 689 650 Total Operating 574 Income 8 14 2 2 638 New Europe Other Gains -2 +104% 18 31 34 313 55 9 171 Trading & Securities 165 164 2,
Slide 17: Efficient operations: Cost / Income at 48.1%
Page 17 Efficient Operations : Cost / Income at 48.1% Cost / Income (%) Cost / Income improves to 40% in Greece and 89.6 to 76% in New Europe (from 89.6% in FY 06) 75.8 Group costs expand 16.1% like-for-like 47.5 48.1 40.7 40 In 2007 the Group acquired 137 points of sale and created 266 new on
Slide 18: Improved credit quality
Page 18 Improved credit quality Group NPL Ratio (% of loans) NPLs at 2.40%, from 2.76% in FY 06 – mainly on improved quality of wholesale portfolio 3.02% 3.02% 3.01% 3.05% Greek NPLs at 2.7% in FY 07 vs. 5.1% for the Greek banking system (June 07) 2.76% 2.65% 2.57% 2.57% Steady coverage at 92%
Slide 19: Segmental Performance
Page 19 Segmental Performance 19
Slide 20: Profits before tax up 28% to € 1,053 m
Page 20 Profits before tax* up 28% to € 1,053 m PBT* per Segment Group PBT* 06/07 growth +11% + 24% +13% + 34% +67m FY 07 435 1,053 + 28% Delta 825 236 216 392 FY 06 115 174 176 37 102 67 14 (30) Retail Corporate Wealth Global & Capital & Other Management Capital Markets New Europe 2006 2007 Figures
Slide 21: Retail – highly efficient franchise with growing returns
Page 21 Retail – highly efficient franchise with growing returns FY 06 FY 07 06/07 +11% + 11% +13% +11% – Cost to Income 44.5% 44.3% growth – Return on Equity 40.8% 42.2% 1,336 – Share of profits 47.5% 41.4% 1200 591 533 435 310 Retail: incorporating customer current accounts, savings, deposits, cre
Slide 22: Corporate – improved quality and profitability
Page 22 Corporate – improved quality and profitability FY 06 FY 07 06/7 growth +12% + 9% (40%) + 24% – Cost to Income 32.4% 31.6% – Return on Equity 22.6% 23.9% – Share of profits 21.1% 20.5% 344 216 306 109 Corporate: incorporating direct debit facilities, current 174 accounts, deposits, overdrafts
Slide 23: Wealth Management – substantial contribution
Page 23 Wealth Management –substantial contribution FY 06 FY 07 – Cost to Income 33.6% 34.2% 06/7 growth +15% +17% + 13% – Return on Equity 77.2% 82.2% – Share of profits 12.4% 11.0% 178 155 115 102 61 Wealth Management: incorporating private banking 52 services, including total wealth management to
Slide 24: Global & Capital Markets – outstanding efficiency
Page 24 Global & Capital Markets – outstanding efficiency FY 06 FY07 06/7 +27% + 7% + 34% – Cost to Income 27.1% 22.9% growth – Return on Equity 78.1% 70.7% 307 – Share of profits 21.4% 22.4% 236 242 176 Global & Capital Markets: incorporating investment 70 banking services including corporate finan
Slide 25: New Europe loan additions at € 5.4 bn in FY07
Page 25 New Europe loan additions at € 5.4 bn in FY07 Record 4Q loan additions of €1.8 bn Net loan additions per country (€bn) NE organic loan additions / Greek loan additions (%) Loan balances FY 06 109% Loan Δ in 2007 1,843 44% 1.5 1,280 Universal 1,220 1.0 78 20% DZI Tekfen 240 342 727 669 1.4 1.
Slide 26: NE: Delivering 28% of PBT Δ
Page 26 NE: Delivering 28% of PBT Δ FY 06 FY 07 – Cost to Income 83.9% 71.0% 06/7 of NE established operations growth +104% + 71% + 90% +67m – Cost to Income 97.7% 81.9% 638 522 *segmental reporting entails the internal allocation of all revenues and all costs between business units, thereby present
Slide 27: Superior Shareholder Returns
Page 27 Superior Shareholder Returns 27
Slide 28: Net profit rises 32% to € 851m excluding one-offs
Page 28 Excluding new tax on capital gains & one-off wildfire donations, Net profit rises 32% to € 851m +32.1% Wildfire donations (20) New Europe 851 Capital Gains Tax (16.6) 72.6 815 779 644 601 FY 06 excl. Greece New Europe FY 07 FY 07 after FY 06 after Reserves Tax tax tax Net profits excluding n
Slide 29: Improved returns for shareholders
Page 29 Improved returns for shareholders* Quarterly profitability (€ m) RoE (%) 28.1 219 23.0 23.5 213 216 204 156 4Q 06 1Q 07 2Q 07 3Q 07 4Q 07 FY06 FY07 FY07 like-for-like incl. Share Capital Increase RoA (%) Capital Adequacy under Basle II (FY 07) Regulatory Capital € 5.7 bn 1.42 1.50 1.47 1.47
Slide 30: Exceeded 2007 targets – reiterating 2010 targets
Page 30 Exceeded 2007 targets – reiterating 2010 targets Group Net Profits (€ m) New Europe Net Profits (€ m) >550 >1,550 >170 72.6 >60 FY 07 target FY07a FY08 target FY 10 target >1,030 851 >820 Group Cost / Income by 2010 < 45% FY 07 target FY 07a* FY 08 target FY 10 target Group RoE by 2010 >25%
Slide 31: Appendices
© Eurobank EFG Appendices
Slide 32: Financial Ratios
Page 32 Financial Ratios Financial Ratios FY 07 FY 06 Net Interest Margin 3.28% 3.27% Cost-Income 48.1% 47.5% NPLs (% of loans) 2.40% 2.76% NPLs coverage 92.1% 89.3% Provision Charge (% of net loans) 1.01% 1.14% Tier Ι Ratio 9.22% 8.46% Total Capital Adequacy ** 12.23% 10.41% ROA after tax** 1.42% 1
Slide 33: Summary Figures
Page 33 Summary Figures Summary Figures (€ m) FY 07 FY 06 Δ% New Europe Net Interest Income 2,003.6 1,596.6 25.5% 443.3 Net fees & Commissions 557.8 446.7 24.9% 177.1 Insurance and Non banking fees 76.2 57.6 32.4% 1.8 Total Operating Income 2,816.4 2,233.5 26.1% 638.3 Operating Expenses 1,354.2 1,06
Slide 34: Key figures of New Europe operations
Page 34 Key figures of New Europe operations Bulgaria Romania Serbia Poland Turkey Ukraine Cyprus NE Δ% Total Assets € 3.3bn € 4.8bn € 1.3bn € 2.2bn € 1.8bn € 435m € 535m €14.3bn 125% Balance Sheet Total Loans € 2.4bn € 3.1bn € 848m € 1.7bn € 715bn € 334m €106m € 9.3bn 142% Total Deposits € 1.7bn €
Slide 35: FY 2007 – Summary per Segment
Page 35 FY 2007 – Summary per Segment Segmental Results FY 07 Wealth Global & Capital Capital & Elimination NE excl. Total (€ m) Retail Corporate Management Markets Other Center New Europe Pl & Ukr Interest income 1,147 252 42 112 7 0 443 384 2,004 Net fee & commission income 54 41 114 173 -2 0 177
Slide 36: FY 2006 – Summary per Segment
Page 36 FY 2006 – Summary per Segment Wealth Global & Capital Capital & Elimination Total Segmental Results FY 06 (€ m) Retail Corporate Management Markets Other Center New Europe Interest income 1,068 205 30 78 0 0 215 1,597 Net fee & commission income 56 38 120 150 0 0 82 447 Net Insurance income
Slide 37: Contacts
Page 37 Contacts EFG Eurobank Ergasias, 20 Amalias Avenue, 105 57 Athens, Greece Fax: +30 210 3337 160 E-mail: investor_relations@eurobank.gr Internet: www.eurobank.gr Reuters: EFGr.AT Bloomberg: EUROB GA Investor Relations Dimitris Nikolos Tel: +30 210 3337688 E-mail: dnikolos@eurobank.gr Marle