Procredit Holding Ag · XETR:PCZ
Procredit — Q1 2019 Earnings Presentation
39 slides from Procredit's earnings presentation, May 13, 2019
Slide 1: Q1 2019 results
Gabriel Schor, Member of the Management Board Helen Alexander, Investor Relations Christian Dagrosa, Head of Controlling Q1 2019 results Frankfurt am Main, 13 May 2019
Slide 2: ProCredit – A unique approach to banking
ProCredit – A unique approach to banking Summary Key figures Q1 2019 and FY 2018 ► A profitable, development-oriented commercial group of banks for Total assets Customer loan portfolio Deposits/loans(1) SMEs with a focus on South Eastern Europe and Eastern Europe EUR 6,001m EUR 4,423m 85% ► Headquar
Slide 3: Agenda
Agenda A Highlights B Financial development C Asset quality D Balance sheet, capital and funding Q&A Appendix ProCredit Group | Q1 2019 results | Frankfurt am Main, 13 May 2019 2
Slide 4: Where are we coming from? Significant progress since 2013
Where are we coming from? Significant progress since 2013 Focused growth in SME loan categories(1) Decrease in overall branch network Decrease in number of total group staff 645 86% 87% 11,514 328 46% 87 2,971 2,940 317 86 46 41 46 40 Dec-13 Dec-18 Mar-19 Dec-13 Dec-18 Mar-19 Dec-13 Dec-18 Mar-19 Lo
Slide 5: Key Recent Developments
Key Recent Developments Deepening of “Hausbank” business client strategy ► Continued growth in our SME portfolio while maintaining strong portfolio quality ► Successful positioning as Hausbank for SMEs driving growth of transaction and deposit volumes Expansion of “ProCredit Direct” private client s
Slide 6: Solid volume growth in loan portfolio
Solid volume growth in loan portfolio Q1 2019 +2% Initial loan size (in EUR) +12% FY 2018 Initial loan size (in EUR) Note: Gross Loan volume growth split by initial loan size in all segments; Q1-19 portfolio growth of continued operations ProCredit Group | Q1 2019 results | Frankfurt am Main, 13 May
Slide 7: Outlook for ProCredit Group 2019
Outlook for ProCredit Group 2019 ► Growth of the loan portfolio 10 – 13%(1) ► Profit for the period EUR 48 – 55m ► Cost-income ratio (CIR) < 70% ► CET1 ratio > 13% ► Dividend payout ratio 1/3 of profits In the medium term, assuming a stable political, economic and operating environment, we see poten
Slide 8: Agenda
Agenda A Highlights B Financial development C Asset quality D Balance sheet, capital and funding Q&A Appendix ProCredit Group | Q1 2019 results | Frankfurt am Main, 13 May 2019 7
Slide 9: Q1 2019 results at a glance
Q1 2019 results at a glance In EUR m Q1-2018 Q1-2019 y-o-y Net interest income 45.9 45.4 -0.5 Provision expenses -0.4 2.1 2.5 Net fee and commission income 11.5 12.7 1.2 Net result of other operating income 1.0 0.9 -0.1 Operating income 58.9 57.0 -1.9 Income Operating expenses 40.7 41.2 0.5 statemen
Slide 10: Net interest income
Net interest income ► Slight decrease in net interest income, in part due to reduced number of days in the first quarter 3.4% 3.4% 3.3% 3.2% 3.1% ► Underlying trends in interest income are overall positive with steady increases in portfolio size as the major driver 45.9 46.2 47.2 46.9 45.4 ► Increas
Slide 11: Provisioning expenses
Provisioning expenses ► Loan loss provisioning expenses at extraordinarily low levels 19 bps throughout 2018 ► Increase in Q1 due to increase in stage 3 loans in the 3 bps Eastern European segment 0.3 2.1 ► Credit impaired loans and coverage ratio remained at year- -0.1 -4.5 -0.4 end levels of 3.1%
Slide 12: Net fee and commission income
Net fee and commission income ► In 2018, steady increase in net fee and commission income 14.8 13.3 ► Q1-19 decrease compared to Q4-18 largely due to seasonal 12.6 12.7 effects (low trading volume in the beginning of the year) 11.5 ► YoY, increase in net fee and commission income of more than EUR 1.
Slide 13: Operating expenses
Operating expenses ► Operating expenses in Q1 largely on previous year levels 69.7% 70.6% 67.3% 71.4% 69.8% ► Minor YoY increase in general and administrative expenses above all related to higher marketing activities for direct 20.3 banking offer 19.1 18.9 19.9 19.1 ► Cost-income ratio on previous y
Slide 14: Contribution of segments to group net income Q1 2019
Contribution of segments to group net income Q1 2019 Group functions, e.g. risk management, reporting, capital management, IT, Includes above all expected liquidity management, training and development losses from the planned disposal of PCB Colombia Includes ProCredit Holding, Quipu, ProCredit Acad
Slide 15: Agenda
Agenda A Highlights B Financial development C Asset quality D Balance sheet, capital and funding Q&A Appendix ProCredit Group | Q1 2019 results | Frankfurt am Main, 13 May 2019 14
Slide 16: Structure of the loan portfolio
Structure of the loan portfolio Loan portfolio by geographical segments Loan portfolio by sector South America: Germany: Private loans: Business loans: 5% 1% 8% 92% 5% 1% 7% 1% Eastern Europe: 3% 19% South Eastern 23% Europe: 8% 27% 70% 16% 13% 5% 17% 4% 4% 20% 6% 12% 23% 8% Wholesale and retail tra
Slide 17: Structure of the loan portfolio (continued)
Structure of the loan portfolio (continued) Loan portfolio by initial loan size Loan portfolio by currency 11% 13% 35% 21% 53% 37% 18% 12% < 50k 50-250k 250-500k 500k-1.5m >1.5m EUR USD Other currencies Notes: Loan portfolio by initial loan size and by currency in % of gross loan portfolio, continue
Slide 18: Loan portfolio quality
Loan portfolio quality IFRS 9 ► Share of default loans constant on level of Dec-2018 Net write- 0.4% 0.4% 0.1% ► Coverage of impaired loan at comfortable level above offs(1)(5) 90% Coverage impaired 84.6% 90.8% 91.1% portfolio(2) ► Net write-off ratio of 0.1% in line with the group’s long Coverage t
Slide 19: Structure of collateral
Structure of collateral Collateral by type ► Majority of collateral consists of mortgages 20% ► Growing share of financial guarantees mainly as result of InnovFin and other guarantee programmes provided by the European Investment Fund ► Clear, strict requirements regarding types of acceptable collat
Slide 20: Development of green loan portfolio
Development of green loan portfolio Green loan portfolio growth 9.1% 12.6% 15.4% 15.3% ► Strong growth in green loan portfolio over the past years 678 676 15 14 ► Portfolio size in Q1-19 largely constant due to sale of project 489 finance portfolio in Germany 14 331 662 662 ► Includes financing of i
Slide 21: Agenda
Agenda A Highlights B Financial development C Asset quality D Balance sheet, capital and funding Q&A Appendix ProCredit Group | Q1 2019 results | Frankfurt am Main, 13 May 2019 20
Slide 22: Asset reconciliation
Asset reconciliation Other assets 11% Assets held 1% for sale 16% Cash and cash equivalents (in EUR m) Net loans to 72% customers ProCredit Group | Q1 2019 results | Frankfurt am Main, 13 May 2019 21
Slide 23: Liabilities and equity reconciliation
Liabilities and equity reconciliation Liabilities 17% to banks and IFIs (in EUR m) Liabilities to 63% customers Debt securities 4% 1% Other liabilities 2% Subordinated 13% Equity debt ProCredit Group | Q1 2019 results | Frankfurt am Main, 13 May 2019 22
Slide 24: Liquidity update
Liquidity update Liquidity coverage ratio 187% 174% 170% ► Q1 level of HLAs slightly below year-end due to seasonal reduction of excess liquidity 100% 100% 100% ► Year-on-year increase in HLA of EUR 125m, further strengthening the group’s overall risk profile Mar-18 Dec-18 Mar-19 ► LCR remained comf
Slide 25: Regulatory capital and risk-weighted assets
Regulatory capital and risk-weighted assets Overview of capitalisation in EUR m Dec-18 Mar-19 ► Increase in CET1 capital due to positive impact of CET1 capital 678 683 translation reserve Additional Tier 1 capital 0 0 Tier 1 capital 678 683 ► Profits up to Q3 2018 recognised Tier 2 capital 130 131 T
Slide 26: Development of CET1 capital ratio (fully loaded)
Development of CET1 capital ratio (fully loaded) Leverage ratio Leverage ratio 11.0% 11.0% ProCredit Group | Q1 2019 results | Frankfurt am Main, 13 May 2019 25
Slide 27: Agenda
Agenda A Highlights B Financial development C Asset quality D Balance sheet, capital and funding Q&A Appendix ProCredit Group | Q1 2019 results | Frankfurt am Main, 13 May 2019 26
Slide 28: Q&A
Q&A ProCredit Bank Georgia ProCredit Group | Q1 2019 results | Frankfurt am Main, 13 May 2019 27
Slide 29: Agenda
Agenda A Highlights B Financial development C Asset quality D Balance sheet, capital and funding Q&A Appendix ProCredit Group | Q1 2019 results | Frankfurt am Main, 13 May 2019 28
Slide 30: Overview of quarterly financial development
Overview of quarterly financial development In EUR m Q1-2018 Q2-2018 Q3-2018 Q4-2018 Q1-2019 Net interest income 45.9 46.2 47.2 46.9 45.4 Provision expenses -0.4 0.3 -0.1 -4.5 2.1 Net fee and commission income 11.5 12.6 13.3 14.8 12.7 Net result of other operating income 1.0 -1.2 1.3 1.2 0.9 Operati
Slide 31: Segment South Eastern Europe
Segment South Eastern Europe Regional loan portfolio breakdown Key financial data Bosnia Albania 6% (in EUR m) Q1 2018 Q1 2019 6% Bulgaria Net interest income 27.9 26.8 Romania 28% Provision expenses -2.0 0.3 8% Net fee and commission income 8.0 9.0 Net result of other operating income 1.3 0.4 Maced
Slide 32: Segment Eastern Europe
Segment Eastern Europe Regional loan portfolio breakdown Key financial data Moldova 11% (in EUR m) Q1 2018 Q1 2019 Net interest income 13.9 14.4 Provision expenses -0.5 2.3 Net fee and commission income 2.0 2.3 Net result of other operating income 0.7 0.9 Operating income 17.1 15.2 Georgia Ukraine 3
Slide 33: Segment South America
Segment South America Regional loan portfolio breakdown Key financial data (in EUR m) Q1 2018 Q1 2019 Net interest income 3.5 3.8 Provision expenses 0.7 -0.5 Net fee and commission income -0.1 -0.1 Net result of other operating income 0.9 -0.2 Operating income 3.5 4.0 Operating expenses 3.9 3.9 Oper
Slide 34: Funding and rating update
Funding and rating update Funding sources overview 3% 1% ► Highly diversified funding structure and counterparties 4% 4% ► Customer deposits main funding source, accounting for 72% as Customer deposits of Mar-19 16% Liabilities to IFIs ► Supplemented by long-term funding from IFIs and institutional
Slide 35: Balance sheet
Balance sheet in EUR m Mar-19 Dec-18 Assets Cash and central bank balances 979 964 Loans and advances to banks 164 212 Investment securities 269 297 Available-for-sale financial assets 0 0 Loans and advances to customers 4,423 4,392 Allowance for losses on loans and advances to customers -123 -124 D
Slide 36: Income statement by segment
Income statement by segment 01.01.- 31.03.2019 South Eastern Germany incl. Eastern Europe South America Group (in EUR m) Europe Consolidation Interest and similar income 30.1 34.5 6.1 0.0 70.7 of which inter-segment 0.2 0.0 0.0 5.3 0.0 Interest and similar expenses 15.7 7.6 2.3 -0.4 25.3 of which in
Slide 37: Information regarding financial figures in this presentation
Information regarding financial figures in this presentation Q1 2019: ► Financial data for three-month period ended 31 March 2019, as shown in the unaudited quarterly financial report ended 31 March 2019. FY 2018: ► Financial data for the fiscal year ended 31 December 2018, restated according to the
Slide 38: Contact Investor Relations
Contact Investor Relations Contact details Financial calendar Investor Relations Date Place Event information ProCredit Holding AG & Co. KGaA 17.05.2019 Frankfurt/Main Annual General Meeting Nadine Frerot Interim Report as of 30 June 2019 14.08.2019 tel.: +49 69 951 437 285 16:00 CEST Analyst Confer
Slide 39: Disclaimer
Disclaimer The material in this presentation and further supporting This presentation and further supporting documents may contain documents have been prepared by ProCredit Holding AG & Co. forward-looking statements including statements regarding our KGaA, Frankfurt am Main, Federal Republic of Ger