Bper Banca S.p.a. · MIL:BPE

Bper Banca — CA Cheuvreux Pan-Europe Forum 2011

45 slides from Bper Banca's conference presentation, May 17, 2011

  1. Slide 1: BPER GROUP Presentation

    BPER GROUP Presentation CA Cheuvreux Pan-Europe Forum - London 17 May 2011

  2. Slide 2: Disclaimer

    Disclaimer This document has been prepared by the cooperative company “Banca Popolare dell’Emilia Romagna” solely for information purposes, and only in order to present its strategies and main financial figures. The information contained in this document has not been subjected to independent audit.

  3. Slide 3: Contents

    CONTENTS  BPER Group  Main figures trend  1Q11 Results  Highlights  Assets and liabilities  Profit and loss  Capital adequacy  Group Business Plan 2009-2011: work in progress 3

  4. Slide 4: A Leading Federated Banking Group (1/2)

    A Leading Federated Banking Group (1/2) Number of branches and market share by Province BPER Group highlights  1,300 branches in Italy and 1 branch in Luxembourg as of 31 Dec. 2010  National market share of 3,8% (number of branches)  Strong regional presence with a market share over 4% in 7 regio

  5. Slide 5: A Leading Federated Banking Group (2/2)

    A Leading Federated Banking Group (2/2) Commercial banks Wealth Management Other financial Corporate & & insurance services Investment banking Banca popolare dell’Emilia Romagna (Parent bank) Optima SGR ABF Leasing Meliorbanca (100%) (100%) Spa (100%) Banca Pop. Di Banca Pop. di Ravenna Aprilia (55%

  6. Slide 6: BPER Group: history and growth

    BPER Group has an excellent track record in acquiring and restructuring small local banks,a process which has – in just a few years – turned it into one of Italy’s foremost national banking groups BPER Group: history and growth Incorporation of EBT in Disposal of BPER ARCA Vita Total assets (€/bn) c

  7. Slide 7: Main events

    Main events  2010 main events  Changes in the scope of consolidation:  disposal of Banca della Nuova terra (“BNT”) - March 2010  disposal of ARCA Vita - June 2010  merger by incorporation of ABF Factoring in EmilRo Factoring - July 2010  agreement with Santander Private Banking for the sale of

  8. Slide 8: BPER Group peers (1/2)

    BPER Group peers (1/2) Total assets (€/bn) Customer loans (net - €/bn) UCG 555,7 UCG 929,487 ISP 379,235 ISP 658,757 MPS 156,237 MPS 244,279 UBI 101,815 BP 135,156 UBI 130,558 BP 94,462 BPER 58,498 BPER 47,78 BPM 54,053 BPM 35,585 0 100 200 300 400 500 600 700 800 900 1000 0 100 200 300 400 500 600

  9. Slide 9: BPER Group peers (2/2)

    BPER Group peers (2/2) Loans/Total assets Total RWA/Total assets 81,7% 81% 59% 65,8% BPER Peers BPER Peers Goodwill/ Total assets Leverage: Tot.Tangible Assets/Tangible Net Equity 2,6% 21,8 16,4 0,8% BPER Peers BPER Peers Sources: FY10 Consolidated Results – Peers: UCG, ISP, MPS,UBI, BP, BPM 9

  10. Slide 10: BPER ratings, analyst recommendations and market cap

    BPER ratings, analyst raccomandations and market cap Ratings (as of 9 May 2011) Analyst raccomandations (as of 9 May 2011) HOLD; 1 Long term A- Short Term A-2 Outlook Stable BUY OUTPERFORM HOLD Long term A- Short Term F2 Outlook Negative OUTPERFORM; BUY; 2 4 Individual C Support 3 Average target Pri

  11. Slide 11: Contents

    CONTENTS  BPER Group  Main figures trend  1Q11 Results  Highlights  Assets and liabilities  Profit and loss  Capital adequacy  Group Business Plan 2009-2011: work in progress 11

  12. Slide 12: Main figures trend (1/2)

    Main figures trend (1/2) Loans Direct Funding Total 8 % Cagr 5,3% Cagr 8, 48.284 45.232 47.001 45.442 47.780 40.135 40.213 37.366 35.391 31.274 2006 2007 2008 2009 2010 2006 2007 2008 2009 2010 Cost/income Cost of credit * 2008-2010 figures pro-formed to be comparable with previous years 1,28% 59,8%

  13. Slide 13: Main figures trend (2/2)

    Main figures trend (2/2) ROE (Net profit/Shareholders’ equity) 13,0% 13,3% Non recurrent events: 12,1% 12,2% 2006y: disposal of Ferrari and BNL stakes 9,0% 2007y: disposal of Banca CIS and CSE stakes, also 7,9% 8,0% a different accounting approach relating termination 5,7% indemnities (“TFR”) 4,3%

  14. Slide 14: Contents

    CONTENTS  BPER Group  Main figures trend  1Q11 Results  Highlights  Assets and liabilities  Profit and loss  Capital adequacy  Group Business Plan 2009-2011: work in progress 14

  15. Slide 15: Highlights

    Highlights  1Q11 net profit higher y/y: net profit up 10.1% at € 72.5 milion and net profit Group share (after minorities) up 6.1% at € 61.6 milion  Core revenues stable, supported by a mix of:  NII solid performance up 1.5% y/y despite particularly stressed funding cost enviroment and hard repri

  16. Slide 16: Main events

    Main events  Closing ClosingofofMeliorbanca MeliorbancaPrivate disposal Private to Santander disposal to Santander  By January 1, 2011 BPER Services Consortium is operative also in back-office and administration services (with a total staff of 694)  Customer Relationship Management new procedure

  17. Slide 17: Scenario evolution

    Scenario evolution Euribor 3M: monthly figures compared with budget scenario 2011 and the Business Plan 2009-2011 “worst” scenario 2,00 1,80 1,60 1,40 1,20 1,00 0,80 0,60 0,40 0,20 0,00 Jun-10 Aug-10 Apr-10 Oct-10 Jun-11 Aug-11 Apr-11 Oct-11 Feb-10 Feb-11 Dec-09 Dec-10 Dec-11 effective budget 2011 w

  18. Slide 18: Contents

    CONTENTS  BPER Group  Main figures trend  1Q11 Results  Highlights  Assets and liabilities  Profit and loss  Capital adequacy  Group Business Plan 2009-2011: work in progress 18

  19. Slide 19: Assets & Liabilities

    Assets & Liabilities Assets Main trends €/mn mar.'11 dec.'10 mar.'10  YoY  Customer loans and direct funding up on a yearly basis Customer Loans 47.830 47.780 45.161 5,9% Securities Portfolio 4.943 5.030 4.585 7,8%  Net interbank position strong improvement to -263 of which AFS 1.747 1.709 939

  20. Slide 20: Direct funding (1/2)

    Direct funding (1/2) Total Direct Funding (€/mn) Main trends +5.2%  Direct deposits positive increase y/y (+5.2%), +1.2% thanks to a strong retail funding positioning 48.861  Nearly 70% of direct funding is retail 48.284  Sight deposits (around 60%) amount 28.5 €/bn of which 19.5 €/bn from retail

  21. Slide 21: Direct funding (2/2)

    Direct funding (2/2) 2011 bond maturities – monthly view (€/mn) Main trends 400  No wholesale bond maturities in 2011 and 2012 350  2011 retail bond monthly maturities well distribuited 300 within the year 250  Strong placing power 1Q11: bond issues cover full 200 2011 maturities 356 150  1Q11 f

  22. Slide 22: Indirect deposits and bancassurance

    Indirect deposits and “bancassurance” Total Indirect Deposits (€/mn) Main trends -2.6%  Indirect deposits decrease y/y mainly due to -2.2% institutional counterparties outflows (more than 0,4 €\bn) and switches into direct funding 28.182 28.065 27.458  1Q11 outflows concentrated in AUC and liquidi

  23. Slide 23: Customer loans

    Customer loans Loans (€/mn) Main trends +5.9%  Customer loans up +5.9% YoY and then stabilization +0.1%  ABF Factoring merger in EmilRo Factor: loans growth contribution +0.3 €/bn 47.780 47.830  Good performance of mortgages, expecially by SMEs  Strong focus at commercial banks level on 45.161 m

  24. Slide 24: Doubtful loans (1/2)

    Doubtful loans (1/2) Breakdown of Doubtful Loans (€/mn) Main trends  Doubtful loans stock up (+14.1% YoY) Change on  Watchlist loans up in the 1Q11 due to inflows YoY from commercial banks 3.728 3.608 3.535 14,1% 3.465  Meliorbanca: doubtful loans under control, only 3.268 slightly up y/y (+3.8%

  25. Slide 25: Doubtful loans (2/2)

    Doubtful loans (2/2) % on net lending and coverage Main trends % of net % of net % of net  Watchlist inflows mainly concentrated in Banco di Coverage Coverage Coverage Sardegna, Banca della Campania and Carispaq lending lending lending Net figures 31-mar-10 2010 31-mar-11  Non performing loans cov

  26. Slide 26: Securities portfolio (1/2)

    Securities portfolio (1/2) Breakdown of securities portfolio (as of 31 Mar ‘11) Main trends €/m HFT CFV AFS HTM total % on total  Securities portfolio slight reduction in the 1Q11, Bonds 2.028 154 1.274 703 4.159 84,1% mainly concentrated in HFT Equity 12 7 429 - 448 9,1% Funds and Sicav 18 110 43

  27. Slide 27: Securities portfolio (2/2)

    Securities portfolio (2/2) Bond PTF by issuer Govies&Sovranational PTF by accounting valuation Total PTF 4.15 €/bn Total PTF 2.98 €/bn Sovranational 11,3% Corporate 28,2% AFS; 35% Duration 2,9y Corporate Government HFT; 47% Sovranational Duration 1,6y HTM; 17% Government 60,5% Duration 4,8y Govies&S

  28. Slide 28: Contents

    CONTENTS  BPER Group  Main figures trend  1Q11 Results  Highlights  Assets and liabilities  Profit and loss  Capital adequacy  Group Business Plan 2009-2011: work in progress 28

  29. Slide 29: Profit & Loss

    Profit & Loss Profit & Loss (yearly view) Main trends P&L 31 mar.'11 31 mar.'10 Change  Interest margin up 1.5% y/y to 322.5 €/mn mainly supported by volumes growth €/mn  Commissions slightly down (-2.3% y/y) Interest Margin 322,5 317,8 4,7 1,5% mainly due to Meliorbanca Private Commissions 172,2

  30. Slide 30: Profit & Loss - Quarterly trend

    Profit & Loss - Quarterly trend Profit & Loss (quarterly view) Main trends (€/mn) 1Q11 4Q10 3Q10 2Q10 1Q10  Interest margin basically stable q/q net of 2 days “calendar-effect” (about 7 €/mn) Interest Margin 322,5 329,7 325,8 316,2 317,8 Commissions 172,2 174,4 164,9 174,6 176,2  Trading income go

  31. Slide 31: Interest margin

    Interest margin Interest margin (€/mn) Main trends 1.5%  Growth (+1.5% y/y) supported by volume effect, 317,8 322,5 despite higher competition on funding  Limited repricing power: cap given by “usurary law” (13.6 €\mn in the whole 2010) mar.'10 mar.'11 Interest margin Breakdown (Dec’10) Interest m

  32. Slide 32: Spread effect – Quarterly trends

    Spread effect – Quarterly trends Spread* (%) Main trends 2,03 1,96 1,98 2,03  Total funding cost only marginally affected by higher 1,95 market interest rates:  sight deposits cost increased 19 bps y/y (+8 bps q/q) pushed by Corporate and Large Corporate  cost on bond retail stock increases less

  33. Slide 33: Commissions

    Commissions Commissions (€/mn) Main trends -2.3%  Down 4 €/mn y/y due to:  Meliorbanca Private deconsolidation (2.2 €/mn 176,2 commissions in 1Q10) 172,2  “usurary law” negative impact of 0.7 €/mn y/y  “Usurary law” negative effect in the whole 2010 about 7.8 €/mn  The end of currency CDs place

  34. Slide 34: Non interest income – Dividend and Trading gains

    Non interest income – Dividend and Trading gains Dividends and Trading gains (€/mn) Main trends -13.3%  Positive q/q contribution from mark-to-market on 21,8 Italian government bonds CCT recovering 2010 18,9 losses  Fair value option for financial liabilities negative effect (-8.3 €/mn q/q) due to

  35. Slide 35: Operating costs

    Operating costs Operating Costs (€/mn) Main trends +2.1%  Operating costs up 2.1% y/y explained by a different accounting approach relating to staff 311,4 untaken vacations (+3.7 €/mn vs 1Q10) and BdS 305,1 staff incentives (+1.2 €/mn), in 2010 charged in 2Q  Depreciations: higher costs related to

  36. Slide 36: Loan Loss Provisions

    Loan Loss Provisions Provisions Breakdown Main trends mar.'11 mar.'10 Change 2011 2010  Provisions: strong decrease (-29.6% y/y) and cost €/mn Abs. % Q1 Q4 Q3 Q2 Q1 Loan Loss Provisions 73,6 98,0 -24,4 -24,9% 73,6 104,5 64,7 83,8 98,0 of credit at 16 bps in the 1Q11 (64 bps annualized) Other Provis

  37. Slide 37: Contents

    CONTENTS  BPER Group  Main figures trend  1Q11 Results  Highlights  Assets and liabilities  Profit and loss  Capital adequacy  Group Business Plan 2009-2011: work in progress 37

  38. Slide 38: Regulatory capital

    Regulatory capital Capital Ratios (quarterly trend) Main trends Total 11,7% 11,6% 10,9% 10.6% Capital 10,8% Ratio  CT1 ratio pro-forma up vs December 2010, including retained earnings and two free share capital increase 7,5% 7,4% in execution using valuation reserves: 7,1% 6,8% 7,1% Tier 1 Ratio 6,

  39. Slide 39: Contents

    CONTENTS  BPER Group  Main figures trend  1Q11 Results  Highlights  Assets and liabilities  Profit and loss  Capital adequacy  Group Business Plan 2009-2011: work in progress 39

  40. Slide 40: Business Plan 2009-2011: three development scenarios

    Business Plan 2009-2011: three development scenarios Sensitivity analysis Changes in Net profit and ROE* (€m,%) ROE 550 510 12,1% 468 450 416 338 365 8,8% 350 327 250 224 Net Profit 270 6,5% 202 209 191 150 169 Recurrent Net Profit Net Profit 50 2003 2004 2005 2006 2007 2008 2009 2010 2011E * Net pr

  41. Slide 41: 2010 main figures compared to Business Plan

    2010 main figures compared to Business Plan P&L 31 dec.'10 Business Variazione recurrent non- total Plan 2010 €/mn 2010 vs BP'10 recurrent (worst)* Interest Margin 1.289,5 0,0 1.289,5 1.199,9 89,7 7,5% Commissions 690,1 0,0 690,1 727,1 -37,0 -5,1% Dividends 5,0 0,0 5,0 Trading gains 21,6 26,1 47,6 4

  42. Slide 42: Implementation Plan: 7 Programs and 28 Project initiatives

    The Implementation Plan is articulated in 7 Programs and 28 Project initiatives, 16 of them with high priority Programs Initiatives % Status Distribution Channel Program Re-launch of underperforming Branches CRM instruments&methods + Commercial Behaviours Marketing&Commercial Program Empowerment / R

  43. Slide 43: Main projects on the run

    Main projects on the run project what has been done BPER subsidiaries Undeperforming branches A new and more sofisticated approach to analyze the single I Q ‘11 II Q ‘11 branches CRM A new procedure focused on corporates II Q ‘11 II Q ‘11 Several activities already implemented in BPER and in the Bra

  44. Slide 44: Closing the gap: upside potential in coming years

    Closing the gap: upside potential in coming years. Productivity per employee (€/000) Main trends 13.120  Good potential in terms of productivity, 10.573 mainly on indirect deposits side 4.268 2.521  Good return on assets, but with operating 4.609 structure to improve 4.048 4.005 4.243 BPER Peers C

  45. Slide 45: Contacts

    Contacts Gilberto Borghi Alessandro Simonazzi Head of Investor Relations Head of Planning & Control Via San Carlo, 8/20 Via San Carlo, 8/20 41100 Modena - Italy 41100 Modena - Italy Ph. +39 059 2022194 Ph. +39 059 2022014 E-mail: gilberto.borghi@bper.it E-mail: alessandro.simonazzi@bper.it 45

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