Mediobanca - Banca Di Credito Finanziario S.p.a. · MIL:MB
Mediobanca - Banca Di Credito Finanziario — Mediobanca — Q1 FY18/19 Earnings Presentation
42 slides from Mediobanca - Banca Di Credito Finanziario's earnings presentation, Oct 25, 2018
Slide 1: 1Q19/3M results as at 30 September 2018
Mediobanca 1Q19/3M results as at 30 September 2018 Milan, 25 October 2018
Slide 2: Agenda
Agenda Section 1. Group results as at September 2018 Section 2. Closing remarks Annexes 1. Quarterly segmental reporting tables 2. Glossary
Slide 3: Positive start to FY18/19 despite uncertainty and volatility
Positive start to FY18/19 despite uncertainty and volatility 3M results as at September 2018 Section 1 MB continues on its growth roadmap, with focus on high-margin, specialized, growing businesses whose growth is driven by long-standing trends, with one of the lowest risk profiles in Europe and low
Slide 4: Mediobanca continues on its growth path
Mediobanca continues on its growth path 3M results as at September 2018 Section 1 STRONG LOAN ORIGINATION EFFECTIVE and DIVERSIFIED FUNDING STRUCTURE GROWTH in LOAN BOOK and NII GROWTH in STOCK at DECREASED COST Loan book up to €42bn (up 9% YoY and 3% QoQ) Funding increased to €50bn (up 2% QoQ) WM:
Slide 5: GOP up 7% driven by all revenue sources…
GOP up 7% driven by all revenue sources… NII up 4%, Fees up 12% 3M results as at September 2018 Section 1 MB Group IQ19 gross operating profit after LLPs by source (€m) +7%, +5% adj¹ 8 2 (4) -16% (16) 4 17 12 +5% +9% +6% +8% +12% +4% adj.1 No equity +4% +5% adj.1 gains in 1Q19 vs €89m in 312 308 1Q1
Slide 6: …with almost all divisions contributing positively
…with almost all divisions contributing positively 3M results as at September 2018 Section 1 MB Group IQ19 gross operating profit after LLPs by division (€m) +7% 14 (10) 5 7 - 4 +20% +11% -9% +8% 308 288 GOP Wealth Consumer Corporate & Principal Holding GOP 1Q18 Management Banking Investment Banking
Slide 7: NII up 4% with strong new loan production
NII UP 4% with strong new loan production 3M results as at September 2018 Section 1 NII by division (€m) Loans by division (€bn) +4% WB +13% Specialty finance 345 344 +33% 332 (346 excl. IFRS9¹) 14.0 15.0 13.3 69 66 69 2.1 2.2 1.6 64 66 64 Sept17 June18 Sept18 Sept17 June18 Sept18 223 Consumer Banki
Slide 8: Funding up to €50bn, cost under control
Funding up to €50bn, cost under control 3M results as at September 2018 Section 1 Funding stock breakdown (€bn) Avg. cost of funding trend (bps vs Eur3M) 48.9 49.6 48.5 155 145 135 6.2 6.3 6.0 4.3 4.3 4.3 100 90 85 20.2 19.2 18.6 80 60 60 17.8 19.1 20.8 1Q18 4Q18 1Q19 FY17 FY18 1Q19 MB bonds WM depo
Slide 9: Fee income up 12%, driven by WM - sound trend in CIB
Fee income up 12%, driven by WM - sound trend in CIB 3M results as at September 2018 Section 1 KPIs Group fees by quarter (€m) WM now the largest contributor to Group fees: +12% €70m fees, or 44% of Group total WM fee up 24% YoY, driven by AUM increase. Last 166 quarter impacted by cautious risk all
Slide 10: TFAs up 2% to €65bn, with €1.9bn NNM
TFAs up 2% to €65bn, with €1.9bn NNM 3M results as at September 2018 Section 1 Group TFAs trend (€bn) 50% (AUM+AUA)/TFA 58% 58% 4.7 63.9 1.9 (0.5) 65.3 59.9 (0.7) AUM/AUA 30.0 +2.2 Affluent 37.3 +0.6 Affluent 37.6 +2.5 PB/AM +1.3 PB/AM 12.1 7.6 AUC 7.4 +3.3 AUM/AUA +1.6 Deposits +1.4 Deposits +0.2 A
Slide 11: Costs: business development matched by strong control
Costs: business development matched by strong control 3M results as at September 2018 Section 1 Group cost base by quarter (€m) Cost change by divisions (YoY, 3M Sept18 vs 3M Sept17) +3% 302 Group +3% 262 271 Consumer 111 CheBanca 103 106 WB² 75 65 68 CMB+MBPB 57 70 62 HF 1Q18 Adj¹ 4Q18 1Q19 -10 -5
Slide 12: COR below FY18 level with ever-improving asset quality
COR below FY18 level with ever-improving asset quality 3M results as at September 2018 Section 1 Cost of risk by division (bps) NPLs (“deteriorate”, €m) and coverage (%) 200 57% 58% 55% 60% 1000.0 55% 50% 800.0 45% 195 928 40% 181 600.0 842 828 35% 62 400.0 30% Sept17 June18 Sept18 Net NPLs NPLs cov
Slide 13: Superior asset quality improved further
Superior asset quality improved further 3M results as at September 2018 Section 1 NPLs Bad loans Coverage As % of loans (“deteriorate”) (“sofferenze”) -11% 79% 71% -28% 2.4% 2.0% Mediobanca 928 828 157 58% Group 113 55% 0.4% 0.3% Sept17 Sept18 Sept17 Sept18 Sept17 Sept18 Sept17 Sept18 -3% 2.6% Corpo
Slide 14: CET1 stable at 14.2% - IFRS 9 and spread impact immaterial
CET1 stable at 14.2% - IFRS 9 and spread impact immaterial 3M results as at September 2018 Section 1 CET1¹ phase-in trend (bps) CET1¹ fully loaded trend (IFRS9 and no Danish Compromise - bps) flat -10bps +25 14.2% 14.2% -2 +30 -1 -22 13.1% 13.0% -20 -2 -18 June18 Retained IFRS 9 Spread Other (2) Sep
Slide 15: Agenda
Agenda Section 1. Group results as at September 2018 Section 2. Closing remarks Annexes 1. Quarterly segmental reporting tables 2. Glossary
Slide 16: Mediobanca: a diverging player…
Mediobanca: a diverging player… Closing remarks Section 2 …from our own old business model by structural reshaping …from Italian banks by sensitivity to domestic sovereign spread widening …from large European banks by focus on specialized & growing segments MB growth driven by long-standing trends H
Slide 17: MB business model reshaped while growing
MB business model reshaped while growing Retail now accounts for 58% of funding - 56% of loans WM accounts for >40% of fees – Consumer accounts for >60% of NII Loan book breakdown (€bn, %) Group revenues breakdown (€bn, %) Fee income breakdown (€bn, %) €41bn €0.6bn €2.4bn 44% 40% €18bn €0.2bn 75% 56
Slide 18: Mediobanca: low sensitivity to macro
Mediobanca: low sensitivity to macro Closing remarks Section 2 Low CET1 sensitivity to spread increase Limited dependency on ITA GDP growth Low direct exposure to Italian govies: €2.8bn or ~40% Consumer banking growth uncoupled from ITA GDP of CET1 vs ~90% avg of ITA banks. Duration 2.5Y trend Low C
Slide 19: MB growth driven by long-standing trends
MB growth driven by long-standing trends Closing remarks Section 2 GROWTH GROWTH GROWTH in CIB in WEALTH MANAGEMENT in CONSUMER BANKING due to market opportunities both organic and through M&A and PB-IB mid-caps platform Italian saving market one of the Italian mid-caps among the most Highly profita
Slide 20: Agenda
Agenda Section 1. Group results as at September 2018 Section 2. Closing remarks Annexes 1. Quarterly segmental reporting tables 2. Glossary
Slide 21: Divisional results
Divisional results Annex 1 21
Slide 22: Mediobanca Group P&L
Mediobanca Group P&L 3M results as at September 2018 Annex 1 1Q 4Q 3Q 2Q 1Q D D €m Sept18 June18 Mar18 Dec17 Sept17 QoQ1 YoY1 Total income 638 619 630 572 598 +3% +7% Net interest income 344 345 342 340 332 -0% +4% Fee income 155 166 165 153 138 -6% +12% Net treasury income 41 33 39 47 39 +24% +5% E
Slide 23: Mediobanca Group A&L
Mediobanca Group A&L 3M results as at September 2018 Annex 1 D D €bn Sept18 June18 Sept17 QoQ1 YoY1 Funding 49.6 48.9 48.5 +2% +2% Bonds 18.6 19.2 20.2 -3% -8% Direct deposits (retail&PB) 20.8 19.1 17.8 +9% +17% ECB 4.3 4.3 4.3 - - Others 6.0 6.3 6.2 -5% -4% Loans to customers 42.3 41.1 38.7 +3% +9%
Slide 24: Mediobanca business model
Mediobanca business model Mediobanca Group Holding Functions Group ALM & Treasury Corporate & Investment Consumer Banking Wealth Management Principal Investing Banking (CIB) (CB) (WM) (PI) Corporate & Investment Consumer Banking Affluent & Premier Principal Investing Banking Compass CheBanca! Ass. G
Slide 25: WM: positive results due to distribution enhancement
WM: positive results due to distribution enhancement 3M results as at September 2018 Annex 1 Private banking-AM Affluent & Premier Wealth Management CheBanca! (Affluent & Premier) (WM) Network empowering ongoing Organic growth and M&A TFA growing WM contribution to MB Group PB/IB double coverage eff
Slide 26: Wealth Management results
Wealth Management results 3M results as at September 2018 Annex 1 1Q 4Q 3Q 2Q 1Q D D €m Sept18 June18 Mar18 Dec17 Sept17 QoQ1 YoY1 Total income 136 142 129 133 122 -4% +11% Net interest income 64 66 63 63 64 -2% - Fee income 70 73 64 66 56 -5% +24% Net treasury income 2 3 2 5 3 -36% -28% Total costs
Slide 27: Affluent & Premiere: CheBanca! results
Affluent & Premiere: CheBanca! results 3M results as at September 2018 Annex 1 1Q 4Q 3Q 2Q 1Q D D €m Sept18 June18 Mar18 Dec17 Sept17 QoQ1 YoY1 Total income 72 76 73 74 70 -6% +3% Net interest income 53 53 52 53 54 -2% -2% Fee income 19 23 20 21 16 -15% +20% Total costs (58) (62) (59) (58) (57) -6%
Slide 28: Private Banking results
Private Banking results 3M results as at September 2018 Annex 1 1Q 4Q 3Q 2Q 1Q D D €m Sept18 June18 Mar18 Dec17 Sept17 QoQ1 YoY1 Total income 64 65 56 59 53 -3% +21% Net interest income 12 12 11 10 10 -4% +13% Fee income 50 51 44 45 40 -1% +26% Net treasury income 2 3 2 4 2 -35% -29% Total costs (48
Slide 29: Consumer: confirming excellent trajectory
Consumer: confirming excellent trajectory 3M results as at September 2018 Annex 1 Leveraging market opportunities New business opportunities Consumer banking Compass Outstanding performance, again Distribution enhancing Consumer contribution to MB Group Highest quarterly results ever Domestic platfo
Slide 30: Consumer Banking results
Consumer Banking results 3M results as at September 2018 Annex 1 1Q 4Q 3Q 2Q 1Q D D €m Sept18 June18 Mar18 Dec17 Sept17 QoQ1 YoY1 Total income 257 252 251 247 246 +2% +4% Net interest income 223 218 218 218 214 +2% +4% Fee income 34 34 32 29 32 -1% +6% Total costs (68) (75) (72) (73) (65) -10% +5% L
Slide 31: CIB: sound results
CIB: sound results 3M results as at September 2018 Annex 1 Specialty Finance (SF) Corporate & Investment Banking Wholesale Banking (WB) (CIB) Significant CIB top-line contributor Sound results and positioning Diversified revenue mix CIB contribution to MB Group IB leadership in Italy confirmed. Firs
Slide 32: CIB results
CIB results 3M results as at September 2018 Annex 1 1Q 4Q 3Q 2Q 1Q D D €m Sept18 June18 Mar18 Dec17 Sept17 QoQ1 YoY1 Total income 159 150 164 164 153 +6% +4% Net interest income 69 66 64 67 69 +3% - Fee income 57 63 75 63 53 -10% +7% Net treasury income 34 20 26 34 31 +67% +9% Total costs (62) (70)
Slide 33: WB results
WB results 3M results as at September 2018 Annex 1 1Q 4Q 3Q 2Q 1Q D D €m Sept18 June18 Mar18 Dec17 Sept17 QoQ1 YoY1 Total income 127 119 136 133 127 +6% -0% Net interest income 48 47 46 52 54 +4% -11% Net treasury income 34 20 26 34 31 +69% +9% Fee income 45 53 65 48 42 -15% +6% Total costs (51) (58
Slide 34: Specialty Finance results
Specialty Finance results 3M results as at September 2018 Annex 1 1Q 4Q 3Q 2Q 1Q D D €m Sept18 June18 Mar18 Dec17 Sept17 QoQ1 YoY1 Total income 32 30 28 31 26 +6% +26% Net interest income 20 20 18 15 15 +3% +40% Fee income and other income 12 11 10 15 11 +14% +8% Total costs (11) (12) (12) (11) (9)
Slide 35: PI: high profitability with no gains on disposals
PI: high profitability with no gains on disposals 3M results as at September 2018 Section 1 Main equity investments as at Sept18 (€m) Principal Investing Further disposals to come PI contribution to MB Group Revenues up 8% due to AG contribution HF 15% 27% Consumer 13% Net profit at 99m (€171m last
Slide 36: Principal Investing results
Principal Investing results 3M results as at September 2018 Annex 1 1Q 4Q 3Q 2Q 1Q D D €m Sept18 June18 Mar18 Dec17 Sept17 QoQ1 YoY1 Total income 99 78 93 33 91 +26% +8% Gains from disposals 4 2 0 5 89 Impairments 0 (1) (0) (0) (0) Net result 99 79 90 35 171 +25% -42% Book value (€bn) 3.7 4.0 3.8 3.
Slide 37: Holding Functions: cautious ALM in a volatile scenario
Holding Functions: cautious ALM in a volatile scenario 3M results as at September 2018 Annex 1 Holding Functions Treasury, ALM, central functions Leasing (HF) Optimization ongoing Ordered deleverage ongoing HF contribution to MB Group Funding enlarged with strong deposit Positive NPL reduction worko
Slide 38: Holding function results
Holding function results 3M results as at September 2018 Annex 1 1Q 4Q 3Q 2Q 1Q D D €m Sept18 June18 Mar18 Dec17 Sept17 QoQ1 YoY1 Total income (7) 3 (1) (3) (8) -10% Net interest income (15) (7) (6) (9) (16) +125% -3% Net treasury income 4 6 3 3 2 -30% Fee income 4 4 3 3 6 - -29% Total costs (38) (4
Slide 39: Glossary
GLOSSARY Annex 2 39 MEDIOBANCA
Slide 40: Glossary
GLOSSARY MEDIOBANCA BUSINESS SEGMENT PROFIT & LOSS (P&L) and BALANCE SHEET CIB Corporate and investment banking GOP Gross operating profit WB Wholesale banking Leverage ratio CET1 / Total Assets (FINREP definition) SF Specialty finance Ls Loans CB Consumer banking LLPs Loan loss provisions WM Wealth
Slide 41: Disclaimer & Declaration of head of financial reporting
Disclaimer & Declaration of head of financial reporting As from this quarter, the Mediobanca Group is adopting IFRS 9 to represent its financial instruments. The transition to the new standard has resulted in an approx. €81m reduction in net equity, chiefly due to the introduction of the new impairm
Slide 42: Investor contacts
Investor contacts Mediobanca Group Investor Relations Piazzetta Cuccia 1, 20121 Milan, Italy Jessica Spina Tel. no. (0039) 02-8829.860 Luisa Demaria Tel. no. (0039) 02-8829.647 Matteo Carotta Tel. no. (0039) 02-8829.290 Email: investor.relations@mediobanca.com http://www.mediobanca.com 42