Finecobank Spa · MIL:FBK
Finecobank Spa — Mediobanca Italian CEOs Conference 2016
35 slides from Finecobank Spa's conference presentation, June 2016
Slide 1: 1Q16 Results – Company overview, June 2016
1Q16 Results Company overview – June 2016
Slide 2: Disclaimer
Disclaimer This Presentation may contain written and oral “forward-looking statements”, which includes all statements that do not relate solely to historical or current facts and which are therefore inherently uncertain. All forward-looking statements rely on a number of assumptions, expectations,
Slide 3: Agenda
Agenda Highlights 1Q16 Results 3
Slide 4: Introducing Fineco
Introducing Fineco Leading multichannel direct bank in Italy, pioneer in anticipating sector trends since 1999 55.3bn 5.5bn TFA Dec'15 2015 Net Sales One single account with multiple service access (+12% y/y) (+37% y/y) Online traditional banking services Trading platform of choice in Italy 544mln +
Slide 5: Growth and Innovation History
Growth and Innovation History The bank for the future … dating back to 1999 Part of Pioneer in Capitalia online Business Group, Merger of Fineco trading innovation FinecoGroup and Xelion Banca Birth of 1 bank st S.p.A. listed Capitalia Most relevant A leading Banca combining PFA on Borsa merged into
Slide 6: Fineco Highlights
Fineco Highlights Unique business model, leading position in core segments, recurring profitability and attractive growth In the "sweet spot" to capture healthy long term sector dynamics Attractive market Leading position in core markets, difficult to replicate Unique, fully integrated business mode
Slide 7: Integrated Business Model
Integrated Business Model Fully integrated offer of banking, investing and brokerage services via a truly direct multi-channel approach, already at the forefront of banking distribution evolution Online banking 99% of total number of executed orders initiated online1 ASSET ASSET GATHERING GATHERERS
Slide 8: Focus on trading platforms
Focus on trading platforms Key figures Well diversified platform 27.8m Executed orders in 2015 By product1 Multichannel integrated platform with ease of access Funds 7% 7.9m Executed orders in 1Q16 Forex and CFD Market share in equity 19% 20.84% trading in Italy Fully integrated services, with acces
Slide 9: PFA network distribution – as of March 2016
PFA network distribution – as of March 2016 Capillary network, well spread across Italian regions, with lean structure €46.1bn Distribution network PFA network structure Total Financial Assets related to PFAs 2,634 PFAs North-west Centre 33% 27% Area managers South 32 North-east and Islands 15% 26%
Slide 10: Limited TFA concentration per Personal Financial Advisor
Limited TFA concentration per Personal Financial Advisor PFA network with limited TFA concentration, hence minimizing "key man" risk Breakdown of PFAs by per capita TFA1 Average seniority Almost 833PFAs with TFA TFA (€m) # of PFAs % on total PFA % total TFA at Fineco in excess of €20m … 0-5 405 15.4
Slide 11: Latest Awards
Latest Awards World Finance 100 The most recommended bank - The international magazine World Finance 100 positioned Fineco - Fineco is the most among the 100 top corporations of recommended bank in the 2015, from a selection of 17 banks world by word of mouth from at a global level customers, non-cu
Slide 12: Agenda
Agenda Highlights 1Q16 Results 12
Slide 13: Executive Summary
Executive Summary 1Q16 net profit at 51.2mln (+7.2% y/y, +14.9% q/q(1)) one of the best quarters ever, confirming the effectiveness of a unique business model able to generate strong performance in every market condition Growing revenues (+2.5% y/y, +2.4% q/q) despite the challenging environment
Slide 14: Results
Results Improved net profit (+7.2% y/y, +14.9% q/q) despite challenging environment, thanks to Fineco's unique business model Net Profit, mln Revenues, mln excluding non recurring items(1) +2.5% +2.4% +7.2% 136.7 136.8 140.1 +14.9% 51.2 47.8 44.6 1Q15 4Q15 1Q16 Operating Costs, mln +0.7% 1Q15 4Q15 1
Slide 15: Revenues by P&L Items
Revenues by P&L Items Well diversified stream of revenues able to deliver growth in any market condition Net interest, mln Fees and Commissions, mln +10.2% -7.4% Brokerage +0.2% Investing -8.5% Banking 56.5 62.1 62.2 63.6 Other 62.8 58.2 19.2 1Q15 4Q15 1Q16 25.0 1M Eur 0.00% -0.15% -0.26% 20.3 Tradi
Slide 16: Net interest
Net interest Sustainable and high quality volume dynamics more than offset lower margins and declining interest rates Sight Deposits (mln) and net margins (bps) Term Deposits (mln) and net margins (bps) +20.4% +5.4% -53.8% 14,084 14,537 15,328 1,628 11,798 12,729 13,522 1,358 -6.7% 1,014 793 673 628
Slide 17: Net interest: focus on UniCredit bonds portfolio
Net interest: focus on UniCredit bonds portfolio 7.2% sight deposits growth needed by 2023 compared to 14.2% realized (23% in 2015, 5.4% in 1Q16) to offset lower rates and bond portfolio run off Run-off UniCredit bonds portfolio (mln) and spread (bps) 2,224 1,804 1,924 1,724 1,724 1,574 700 350 2016
Slide 18: Costs
Costs High operating leverage constantly delivered on the back of Fineco's business model Staff expenses, mln and FTE, # Stock granting post IPO 990 1019 1021 Staff expenses, related to top managers and key employees Other administrative expenses, related to PFAs +1.8% -0.9% 3.9 0.9 2.7 2.7 18.4 18.
Slide 19: Capital Ratios
Capital Ratios Best in class capital position and low risk balance sheet RWA, mln CET1 Ratio transitional, % Credit Market Operational +1.9p.p. -0.1p.p. +1.2% 19.38% 20.79% 20.43% 21.39% 21.31% +1.7% 1,836 1,826 1,828 1,859 1,804 Mar.15 Jun.15 Sept.15 Dec.15 Mar.16 1,039 1,061 1,044 1,066 1,071 CET1
Slide 20: TFA
TFA 18.5 bn net sales since 2011 with higher penetration of guided products and services. Start of 2016 impacted by huge market volatility TFA evolution (Dec.10-Mar.16), bn Cumulated performance, bn 55.3 1.4 -1.8 55.0 Net Sales +18.5 bn 0.5 Market Effect +1.3 bn 5.5 49.3 1.7 43.6 4.0 1.3 39.8 2.5 2.
Slide 21: TFA and Net sales - breakdown
TFA and Net sales - breakdown Sustainable and high quality services as key features in our growth. Continuous acceleration in penetration rate of Guided products and services Breakdown of total net sales, bn Breakdown of total TFA, bn AuM AuC Deposits Guided products as % of AuM 5.5 55.3 55.0 55.8 5
Slide 22: Personal Financial Advisors (PFA) network – Total Net sales
Personal Financial Advisors (PFA) network – Total Net sales Organic expansion through a network of 2,634 PFAs. Strong focus on Guided products and services PFA Network – total net sales, bn Net sales, bn - Organic/New Recruit of the year AuM AuC Deposits Net Sales (Organic) Net Sales (New Recruit) 4
Slide 23: Revenues by Product Area
Revenues by Product Area One-stop shop able to deliver solid results in any market environment Banking, mln 45% +8.3% -2.9% 56.1 62.6 60.8 1Q15 4Q15 1Q16 Brokerage, mln 27% Investing, mln 28% Core revenues (NI excluded) +3.3% -15.3% -8.0% +10.6% 40.9 43.1 36.5 37.7 35.1 36.6 1Q15 4Q15 1Q16 1Q15 4Q15
Slide 24: Banking
Banking Resilient performance q/q despite declining interest rates thanks to strong volume growth. Fees affected by new regulation on interchange fees(1) Revenues, mln Direct deposits eop (mln) Net interest +8.3% Sight Deposits Term Deposits Net fees -2.9% +15.0% Net trading Other 62.6 +5.7% 60.8 56
Slide 25: Brokerage
Brokerage One of the best quarters ever with almost 37mln revenues and 7.9mln executed orders Revenues, mln Volatility Index - Ftse Mib Net interest Net fees Net trading 30 25 Core revenues (NI excluded) 20 15 VltyCC 10 -15.3% 5 +4.44% +10.6% 0 43.1 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Oct-11 O
Slide 26: Investing
Investing Higher net commissions y/y due to acceleration in guided products. Market performance impacted AuM. March and April show positive trend Revenues (Net Commissions), mln AuM eop (bn) Upfront fees Management fees Others -2.1% -2.7% +3.3% 26.1 26.2 24.8 26.3 25.6 26.2 -8.0% 40.9 36.5 2.9 37.7
Slide 27: Annex
Annex 27
Slide 28: P&L
P&L mln 1Q15 2Q15 3Q15 4Q15 FY15 1Q16 Net interest income 56.5 59.3 62.9 62.1 240.8 62.2 Net commissions 62.8 64.2 62.0 63.6 252.6 58.2 Trading profit 17.1 11.0 13.2 12.6 53.9 19.6 Other expenses/income 0.4 -3.4 1.6 -1.5 -3.0 0.1 Total revenues 136.7 131.0 139.7 136.8 544.3 140.1 Staff expenses -18.
Slide 29: Details on Net Interest Income
Details on Net Interest Income Volumes & Volumes & Volumes & Volumes & Volumes & Volumes & mln 1Q15 2Q15 3Q15 4Q15 FY15 1Q16 Margins Margins Margins Margins Margins Margins Sight Deposits 51.6 12,729 52.2 13,522 54.5 14,084 54.4 14,537 212.7 13,718 55.4 15,328 Net Margin 1.65% 1.55% 1.53% 1.49% 1.55
Slide 30: UniCredit bonds underwritten
UniCredit bonds underwritten ISIN Currency Amount (€ m) Maturity Indexation Spread 1 IT0004307861 Amortizing Euro 150.0 30-Sep-16 Euribor 1m 0.51% IT0004307861 Amortizing Euro 150.0 2-Oct-17 Euribor 1m 0.51% IT0004307861 Amortizing Euro 150.0 2-Jan-18 Euribor 1m 0.51% 2 IT0005010233 Euro 382.5 30-Ja
Slide 31: Details on Net Commissions
Details on Net Commissions mln 1Q15 2Q15 3Q15 4Q15 FY15 1Q16 Brokerage 25.0 20.8 20.3 19.2 85.3 20.3 o/w Equity 19.9 17.3 16.4 15.1 68.7 16.5 Bond 2.5 1.2 1.1 1.3 6.0 1.1 Derivatives 2.5 2.3 2.6 2.4 9.8 3.2 (1) Other commissions 0.1 0.0 0.2 0.4 0.7 -0.5 Investing 36.5 40.6 38.5 40.9 156.5 37.7 o/w P
Slide 32: Revenue breakdown by Product Area
Revenue breakdown by Product Area mln 1Q15 2Q15 3Q15 4Q15 FY15 1Q16 Net interest income 52.8 54.8 58.0 58.1 223.7 59.8 Net commissions 1.5 2.8 3.2 3.3 10.9 0.1 Trading profit 1.9 1.3 1.1 1.2 5.4 0.9 Other -0.1 -0.1 -0.1 -0.1 -0.3 0.0 Total Banking 56.1 58.8 62.2 62.6 239.7 60.8 Net interest income 0
Slide 33: Breakdown TFA
Breakdown TFA mln March 15 June 15 Sept. 15 Dec. 15 March 16 AUM 26,121 26,169 24,825 26,277 25,565 o/w Funds and Sicav 23,313 23,221 21,949 23,100 22,332 o/w Insurance 2,793 2,933 2,862 3,163 3,219 o/w GPM 15 15 14 14 14 AUC 13,219 12,613 12,868 13,419 12,889 o/w Equity 6,826 6,513 6,619 7,085 6,71
Slide 34: Balance Sheet
Balance Sheet mln March 15 June 15 Sept. 15 Dec. 15 March 16 Due from Banks 14,070 14,583 13,966 14,649 15,404 Customer Loans 797 836 885 923 827 Financial Assets 2,270 2,244 2,241 2,250 2,629 Tangible and Intangible Assets 109 109 109 110 111 Derivatives 25 40 7 11 7 Other Assets 229 240 244 385 28
Slide 35: Main Financial Ratios
Main Financial Ratios March 15 June 15 Sept. 15 Dec. 15 March 16 PFA TFA/ PFA (mln) 17.6 17.6 17.0 17.9 17.8 Guided Products / TFA 19% 20% 20% 21% 22% Revenues per TFA (bps) 106.1 103.8 106.7 104.0 101.6 Cost / income Ratio 43.8% 44.6% 42.6% 42.7% 43.0% CET 1 Ratio 19.4% 20.8% 20.4% 21.4% 21.3% Adju