Mapfre Sa · BME:MAP
Mapfre Sa — Merrill Lynch Banking & Insurance CEO Conference 2007
31 slides from Mapfre Sa's conference presentation, Oct 4, 2007
Slide 1: Putting risk into perspective
Putting risk into perspective Esteban Tejera General Manager Luigi Lubelli Finance Director Merrill Lynch Banking & Insurance CEO Conference "Delivering Growth in a Riskier World" London, 4th October 2007 Nº 2007 - 29
Slide 2: Disclaimer
Disclaimer This document is purely informative. Its content does not constitute, nor can it be interpreted as, an offer or an invitation to sell, exchange or buy, and it is not binding on the issuer in any way. The information about the plans of the Company, its evolution, its results and its divide
Slide 3: A snapshot of MAPFRE
A snapshot of MAPFRE Risk related to the present environment Our opportunities Summing up 3 Nº 2007 - 29
Slide 4: MAPFRE at a glance
MAPFRE at a glance MAPFRE is an independent Spanish group which carries out activities in the fields of insurance, reinsurance, financial services, property development and services primarily in Spain, Europe and Latin America. Ithas direct presence in 40 countries across various business lines, whi
Slide 5: Breakdown of premiums and profits by business line – 1H07
Breakdown of premiums and profits by business line – 1H07 Premiums(1) Profits(2) Life (Abroad) Life (Abroad) Other 4.9% Life (Spain) 1.2% 1.1% Reinsurance 9.7% 11.7% Reinsurance 12.7% Non-Life (Spain) Life (Spain) 48.0% 14.7% Non-Life (Abroad) 13.0% Non-Life (Abroad) 20.8% Non-Life (Spain) 62.4% €6,
Slide 6: Risk related to the present environment
A snapshot of MAPFRE Risk related to the present environment Our opportunities Summing up 6 Nº 2007 - 29
Slide 7: Economic growth is expected to remain sound and above-average
Economic growth is expected to remain sound and above-average in the areas where MAPFRE is present Real GDP growth - developed markets Real GDP growth - emerging markets 5.0% 8.9% 6.9% 6.0% 6.0% 4.0% 3.8% 5.0% 3.6% 4.4% 3.4% 3.7% 5.0% 3.0% 2.8% 2.7% 2.6% 0.3% 0% 2.4% 1.8% 1.7% Budget crisis 1.2% & 1
Slide 8: Selected macroeconomic developments in Spain: supply
Selected macroeconomic developments in Spain: supply Construction is experiencing a slowdown, which is being compensated for by growth in manufacturing. Real GDP growth (y-o-y) Services 5.8% 5.6% 4.0% 3.9% 1.7% 1.5% 0.4% Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 Q1 96 97 9
Slide 9: Selected macroeconomic developments in Spain: demand
Selected macroeconomic developments in Spain: demand Capital investments are thriving on the back of the manufacturing recovery, which is driving economic growth against the backdrop of a moderation in consumer spending. Real GDP growth (y-o-y) Gross capital formation - construction 15.5% 5.8% 4.6%
Slide 10: All in all, a supportive economic outlook
All in all, a supportive economic outlook Barring pronounced downward swings in the largest economies or prolonged financial crises, the main countries and geographical areas in which MAPFRE operates should record continued GDP growth, positive net job creation and relatively low inflation(1), in li
Slide 11: Only 2.6% of MAPFRE's new business in Spain is related to real estate
Only 2.6% of MAPFRE’s new business in Spain is directly related to the real estate sector New business directly related with the real estate sector in Spain as at 30.06.2007 8.0% 5.7% 2.6% 1.4% 1.3% 0.9% 0.3% (3) COMMERCIAL GENERAL LIFE ASSURANCE TOTAL (1) (2) INSURANCE INSURANCE As a % of the Opera
Slide 12: Real estate development represents a very small proportion of total assets
Real estate development(1) represents a very small proportion of the Group’s total assets 1.5% 0.3% Completed developments and work-in- Development land progress 1) Real estate development is run by MAPFRE INMUEBLES. Figures as at June 2007 Risk related to the present environment 12 Nº 2007 - 29
Slide 13: Our investment portfolio is high-quality, with no subprime exposure
Our investment portfolio is of high-quality, with no exposure to subprime risk Portfolio breakdown(1) Breakdown of the bond portfolio by rating(1) Property development Other BB or lower 1.8% BBB Unrated investments 1.2% Property 0.7% 1.2% 3.1% A investment 11.6% 5.9% Shares and mutual funds 9.5% Fix
Slide 14: Our opportunities
A snapshot of MAPFRE Risk related to the present environment Our opportunities Summing up 14 Nº 2007 - 29
Slide 15: Where will our growth come from?
Where will our growth come from? Top line Expansion of business in comparatively faster-growing and underpenetrated areas. Integration and development of product portfolio in new acquisitions and JVs. Enhanced cross-selling of retail non-life products. Expansion of the distribution network. Bottom l
Slide 16: All of MAPFRE's core areas remain underpenetrated
All of MAPFRE’s core areas remain underpenetrated Insurance penetration (gross premiums as % of GDP) 9.2% 9.0% MAPFRE´S core operating areas 7.2% 3.7% 3.1% 2.5% 5.4% 3.1% 5.5% 5.9% 2.4% 4.7% 1.6% 1.4% 2.3% 1.4% 1.0% 0.2% Advanced EU Italy Spain Latin Turkey (1) economies America & Caribbean Life Non
Slide 17: A comparison of MAPFRE's key foreign markets
A comparison of MAPFRE’s key foreign markets Italy Premiums per capita: Premiums per capita (USD) USD 2,379 Average GDP per capita GDP per capita: 2,400 USD 6,200 USD 31,818 Spain Premiums per capita: 1,500 USD 1,513 GDP per capita: Brazil Venezuela USD 28,184 Puerto Rico 180 160 Mexico Average prem
Slide 18: Development stages of European insurance markets
Development stages of European insurance markets Premiums per capita (EUR) 7,000 Average GDP per capita EUR 24,084 UK 6,000 5,000 Switzerland Ireland France 4,000 Denmark Netherlands Norway 3,000 Finland Luxembourg Belgium Sweden Germany Average premiums per capita 2,000 EUR 1,719 Italy Austria Port
Slide 19: Non-life insurance growth has outperformed GDP growth in core areas
Over most of the last decade, non-life insurance growth has outperformed GDP growth in MAPFRE’s core areas Spain Italy 1.08x 1.08x 1.09x 1.04x 1.05x 1.03x 1.01x 1.02x 1.04x 1.03x 1.02x 1.00x 0.99x 1.00x 1.03x 1.00x 1.03x 1.03x 1.01x 1.01x 0.97x 0.98x 1x 1x 1996 1997 1998 1999 2000 2001 2002 2003 200
Slide 20: Highly profitable operating performance
Highly profitable operating performance(1) MAPFRE Non-Life MAPFRE Spain Motor(2) 103.6% 103.8% 101.3% 101.2% 103.6% 100.4% 98.4% 96.2% 95.6% 92.6% 93.9% 95.0% 92.0% 91.5% 90.3% 90.3% 91.2% 88.9% 1998 1999 2000 2001 2002 2003 2004 2005 2006 1998 1999 2000 2001 2002 2003 2004 2005 2006 MAPFRE Spain No
Slide 21: Recent acquisitions and agreements will boost growth
Recent acquisitions and agreements will boost growth by opening new distribution channels and offering turnaround opportunities Spanish Insurance Market LIFE NON-LIFE New Significant thrust to CAJA CASTILLA LA MANCHA Bancassurance banking distribution Increase in agreements market shares and Increas
Slide 22: Spanish motor business: observed trends and outlook
Spanish motor business: observed trends and outlook The operating environment is characterised by falling sales of new cars (-1.5% as at 30.08.2007; source: ANFAC) and aggressive pricing policies. In this environment, MAPFRE AUTOMÓVILES’ business is experiencing (1H ’07 figures): – A positive net in
Slide 23: Spanish life business: the quest for further distribution
Spanish life business: the quest for further distribution MAPFRE’s network represents the largest specialised distribution force for Life assurance and long-term savings products in Spain. Bancassurance also plays a pivotal role in MAPFRE’s current and future strategy in the Life business. The recen
Slide 24: Key management actions: Spain
Key management actions: Spain Non-life Strengthen the competitive position in the retail business through further cross-selling initiatives aimed at increasing the penetration of the motor and non-motor customer bases. Derive the benefits of the integration of Mutua Valenciana Automovilista through
Slide 25: Key management actions: foreign markets
Key management actions: foreign markets Latin America Increasing business diversification, especially in personal lines. Expansion of the tied distribution network and development of complementary distribution channels (agreements with banks, retail outlets, etc.). – Target: 2,000 branches by year-e
Slide 26: Key management actions: foreign markets
Key management actions: foreign markets Turkey Retention of the existing management team. Deployment of management control systems used by MAPFRE in its international operations. Addition of new covers to existing products and expansion of the range offered to customers. Reinforcement of the existin
Slide 27: Acquisitions strategy
Acquisitions strategy When selecting acquisition opportunities, MAPFRE will look for: SEARCH FOR – Markets or market segments which are unexploited or UPSIDE underdeveloped. – Companies whose growth and profitability can be enhanced by MAPFRE’s expertise. A variety of standard valuation techniques a
Slide 28: Summing up
A snapshot of MAPFRE Risk related to the present environment Our opportunities Summing up 28 Nº 2007 - 29
Slide 29: Summing up
Summing up: MAPFRE continues to enjoy growth opportunities … GROWTH – Spain is slowing down, but not crashing – Operations are concentrated in underpenetrated markets – Recent investments open new, exciting development prospects … while keeping a comparatively low risk profile CONSERVATIVE – Consist
Slide 30: Investor Relations Department
Investor Relations Department Luigi Lubelli Finance Director +34-91-581-6071 Alberto Fernández-Sanguino +34-91-581-2255 Beatriz Izard Pereda +34-91-581-2061 Antonio Triguero Sánchez +34-91-581-5211 Jesús Amadori Carrillo +34-91-581-2086 Marisa Godino Alvarez Assistant +34-91-581-2985 MAPFRE S.A. Inv
Slide 31: Putting risk into perspective
Putting risk into perspective Esteban Tejera General Manager Luigi Lubelli Finance Director Merrill Lynch Banking & Insurance CEO Conference "Delivering Growth in a Riskier World" London, 4th October 2007 Nº 2007 - 29
Mapfre — Merrill Lynch Banking & Insurance CEO Conference 2007 on 6ix