Bff Bank Spa · MIL:BFF

Bff Bank Spa — 9M 2022 Earnings Presentation

37 slides from Bff Bank Spa's earnings presentation, Nov 10, 2022

  1. Slide 1: 9M 2022 Results Roadshow Presentation

    9M 2022 Results Roadshow Presentation 10th November 2022 bff.com

  2. Slide 2: Disclaimer

    Disclaimer This presentation may contain written and oral Presentation are provided as at the date of any offer or solicitation to purchase or "forward-looking statements", which includes hereof and are subject to change without subscribe for securities in the United States or all statements that do

  3. Slide 3: Executive Summary

    Executive Summary  9M22 Adjusted Net Profit +33% YoY at €105.4m, strong performance of Factoring & Lending and positive BFF BANKING contribution of Securities Services. Full impact of synergies in Corporate Center GROUP  BFF won confirmation from EU Court of Justice on the right to recover at leas

  4. Slide 4: P&L by Business Units

    P&L by Business Units Factoring & Securities Corporate Payments BFF adjusted Adjustments BFF reported €m Lending Services Center incl. (2) P&L P&L P&L (3) P&L P&L synergies 9M 2022 Net Revenues 124.0 41.1 45.7 64.2 275.0 2.7 277.7 OPEX incl. D&A (29.7) (19.0) (23.6) (48.7) (4) (121.0) (13.2) (134.2)

  5. Slide 5: Factoring & Lending KPIs: continues tailwind with loans +37%

    Factoring & Lending KPIs: continues tailwind with loans +37%  9M22 loan book up by 37% at €4.8bn(1), at historical high, driven €m 9M20 9M21 9M22 by growth in new business volumes. Strong performance of Loans & Receivables(1) 3,683 3,467 4,760 Italy, up by 56% YoY and Greece up by 63% YoY. Spain up

  6. Slide 6: EU Court of Justice win crystallizes €237m of off-BS capital reserve

    EU Court of Justice win crystallizes €237m of off-BS capital reserve and c. €50m of off-BS yearly accrual  BFF won confirmation from EU Court of Justice(1) that the late Payment Directive(2) allows creditors to charge at least €40 per overdue invoice, irrespective of the time of delay and amount of

  7. Slide 7: LPI refixing mechanism: refix to come from Jan-23

    LPI refixing mechanism: refix to come from Jan-23 BFF will benefit from a higher LPI rate on overdue invoices towards PA from Jan-23 ILLUSTRATIVE ECB rate % LPI rate % ECB Ref. Rate vs LPI rate  LPIs are equal to 8%+ spread plus Central Banks’s ECB Ref. Rate current ECB Ref. Rate expected LPI rate

  8. Slide 8: Factoring & Lending P&L: PBT +17% YoY

    Factoring & Lending P&L: PBT +17% YoY €m 9M20 9M21 9M22  Net Interest Income at €114.4m (+17% YoY), thanks primarily to Net Interest Income 103.8 97.4 114.4 higher loan book and to higher net LPIs over-recovery (+€3.8m of which Net LPIs over-recovery (5.8) (3.0) 0.8 YoY) Net Fee and Commission 3.2

  9. Slide 9: Securities Services – KPIs and P&L: PBT up by 13%

    Securities Services – KPIs and P&L: PBT up by 13%  Depositary Bank’s AuD at €77.4bn (-6.7% YoY), due to negative 9M20 9M21 9M22 financial market performance, only partially offset by positive Depositary Bank (AuD EoP , €m) 71,746 82,926 77,392 net inflows Fund Accounting (AuM EoP , €m) 46,628 54,15

  10. Slide 10: Payments – KPIs and P&L: growth in KPIs

    Payments – KPIs and P&L: growth in KPIs, driven by higher economic activity  Number of transactions of transfer and collections +6%YoY 9M20 9M21 9M22 Transfer and collections (n° oper. #m) 206 228 243  Card settlement transactions up by +36% YoY, thanks to higher Card & Other settlement (n° oper.

  11. Slide 11: Corporate Center – P&L: PBT up by €31.2m YoY

    Corporate Center – P&L: PBT up by €31.2m YoY Factoring Securities Corporate  PBT at €15.1m, up by €31.2m YoY, from -€16.1 of BFF Bank Payments & Lending Services Center P&L P&L previous year, thanks to full impact of synergies P&L P&L P&L Total Employees (HC) 31/03/21 881 375 177 49 280  NII at €4

  12. Slide 12: Solid Asset & Liability Structure, no ECB funding

    Solid Asset & Liability Structure, no ECB funding  Strong LCR at 182.6% and NSFR at 146.8%. Leverage ratio at LCR 182.6% Leverage ratio 4.0% NSFR Loan/ 146.8% Deposits 0.67% 4.0% Breakdown 9M22 (€m)  HTC government bonds portfolio at €6.7bn, with €4bn of floaters as of 30-Sept-22. Rebalancing port

  13. Slide 13: Bank of Italy more stringent criteria on New DoD

    Bank of Italy more stringent criteria on New DoD result in higher public sector Past Due, with unchanged risk profile €m BFF stand-alone 9M20 9M21 BFF & DEPObank FY21 9M22  Past due increased to €187.1m due to new and more stringent Net NPLs 66.8 79.4 72.2 86.0 guidance on the New DoD(1) issued by

  14. Slide 14: Solid Capital Ratios with €117m of excess capital

    Solid Capital Ratios with €117m of excess capital vs. dividend policy target and €36.8m of 3Q22 accrued dividend RWAs €m 2,228 2,171 2,701  Total Capital ratio at 19.3% and CET1 ratio at 13.8%, with €117m of capital in excess of 15.0% TC ratio target, €154m RWAs density 44% 45% 45% including 3Q22 n

  15. Slide 15: Next Events

    Next Events 11th – 21st Nov-22 9M 2022 virtual and physical - Milan, London - Roadshow 17th Nov-22 BNP Paribas Exane - 5th MidCap CEO Conference - Paris 6th Dec-22 CIC/Akros Market Solutions Forum - Paris bff.com 14

  16. Slide 16: Appendix

    Appendix 2 BFF bff.com

  17. Slide 17: Glossary

    Glossary AGM Annual General Meeting Govies Government bonds OPEX Operating Expenditures AuC Assets under custody G&A General and Administrative P&L Profit & Loss AuD Assets under depositary H Half-year PA Public Administration Avg. Average HTC Held-To-Collect PAYM Payments BoI Bank of Italy IRR Inte

  18. Slide 18: A true Public Company with Management owning c. 5.9%

    A true Public Company with Management owning c. 5.9% Treasury Shares 0.3% Management 5.9% Free Float 93.8% Total Number of shares as of 30/9/2022: 185,521,548 bff.com 17

  19. Slide 19: 9M21 P&L reported has a different perimeter vs 9M22

    9M21 P&L reported has a different perimeter vs 9M22 9M21 P&L Adjusted 9M22 P&L Adjusted & Reported 9M21 BFF 9M22 BFF January - September January - September 9M21 ex DEPObank 9M22 ex DEPObank January - September January - September 9M21 P&L Reported(1) 9M21 BFF January - September 9M21 ex DEPObank Ja

  20. Slide 20: Positively Geared to a worsening of the European Macro and Public Finances outlook

    Positively Geared to a worsening of the European Macro and Public Finances outlook Slide updated from «1H2022 Results» Outlook Potential impact for BFF 1  • Volumes Rising inflation  Inflation increases nominal expenditures of public sector  • Loans 2  Double geared to interest rates Rising inte

  21. Slide 21: Factoring & Lending: Volumes up 36% YoY

    Factoring & Lending: Volumes up 36% YoY, back to 10%+ long-term target growth rate  Visible benefits from strong commercial efforts in a macro Italy Spain Volumes (€m) environment where higher interest rates and inflation Portugal Poland expectations induce companies to reconsider working capital G

  22. Slide 22: Impact of increase of LPI rate on P&L

    Impact of increase of LPI rate on P&L Slide updated from Assumptions - illustrative example «Investor Day 2021»  LPIs rate: ECB refinancing rate + 8.0% = 10.5%  LPIs collection time: 5 years  31-Dec-27  BFF purchase date: 31-Dec-22  Statutory accrued LPIs for BFF: 45%  €4.7k  Nominal value of

  23. Slide 23: Non-recourse factoring Volumes (1/2)

    Non-recourse factoring Volumes (€m) (1/2) 9M20 1,363 607 63 2,032 Italy 9M21 1,442 485 73 2,001 9M22 1,872 826 385 3,082 9M20 685 379 1,063 Spain 9M21 750 304 1,054 9M22 855 312 1,167 9M20 93 10 103 Portugal 9M21 144 44 187 9M22 167 114 281 NHS PA Other bff.com 22

  24. Slide 24: Non-recourse factoring Volumes (2/2)

    Non-recourse factoring Volumes (€m) (2/2) 9M20 41 6 46 Greece 9M21 61 5 66 9M22 101 13 3 118 0.8 9M20 0.8 Croatia 0.3 9M21 1.5 1.8 9M22 0.6 2.1 1.6 9M20 9 0.4 10 France 9M21 19 3.4 22 9M22 36 2 38 NHS PA Other bff.com 23

  25. Slide 25: Non-recourse factoring and lending Volumes

    Non-recourse factoring and lending Volumes (€m) 9M20 415 121 536 Poland 9M21 369 68 438 9M22 395 80 476 9M20 19 2 22 Slovakia 9M21 22 1 23 9M22 10 3 12 0.2 9M20 1.9 2.0 Republic Czech 9M21 0.7 0.1 0.8 9M22 1.3 0.3 1.6 Healthcare Local Government Units bff.com 24

  26. Slide 26: Factoring & Lending: Breakdown of Volumes by quarter

    Factoring & Lending Breakdown of Volumes by quarter (€m) 1Q 2Q 3Q 4Q 1,971 1,970 1,986 1,8251,782 1,737 1,463 1,570 1,290 1,3691,275 1,3611,326 1,217 1,131 1,2131,161 1,172 1,107 955 833 830 837 871 927 900 967 781 421 600 526 309 679 671 634 2014 2015 2016 2017 2018 2019 2020 2021 2022 Customer Loa

  27. Slide 27: Securities Services & Payments

    Securities Services & Payments AuD end of quarter (€bn) Deposits end of quarter (€bn) 10 10 8 9 9 8 8 8 7 8 7 76 78 80 83 84 82 79 77 65 70 72 2020 2021 2022 2020 2021 2022 AuC end of quarter (€bn) Payment transactions by quarter (#m) 172 173 176 162 168 164 164 175 135 142 141 145 148 149 152 160 1

  28. Slide 28: 9M22 summary P&L

    9M22 summary P&L 1H22 (3) F&L SS PAYM. CC ADJUSTED Adjustments REPORTED €m Interest Income 166.2 5.9 4.9 35.9 212.9 - 212.9 Interest Expenses(1) (51.8) (0.4) 0.6 6.0 (45.5) - (45.5) Net Interest Income 114.4 5.5 5.6 42.0 167.4 - 167.4 Net Fee and Commission Income 2.3 35.6 31.3 (0.6) 68.6 - 68.6 Div

  29. Slide 29: 9M21 summary P&L

    9M21 summary P&L 1H21 (3) €m F&L SS PAYM. CC ADJUSTED Adjustments REPORTED Interest Income 134.2 8.3 5.4 12.1 159.9 (2.8) 157.1 Interest Expenses(1) (36.8) (1.8) - 6.4 (32.1) (1.0) (33.1) Net Interest Income 97.4 6.6 5.4 18.5 127.9 (3.9) 124.0 Net Fee and Commission Income 4.6 34.0 33.1 (1.2) 70.5 (

  30. Slide 30: 9M20 summary P&L

    9M20 summary P&L (2) €m F&L SS PAYM. CC ADJUSTED Adjustments REPORTED Interest Income 156.6 10.6 1.3 40.8 209.2 (38.5) 170.7 Interest Expenses (52.8) (2.7) 0.0 8.2 (47.2) 10.7 (36.6) Net Interest Income 103.8 7.9 1.3 49.0 162.0 (27.8) 134.1 Net Fee and Commission Income 3.2 31.1 29.6 (0.5) 63.3 (60.

  31. Slide 31: Summary reported consolidated Balance Sheet

    Summary reported consolidated Balance Sheet BFF stand- BFF & DEPObank alone €m 9M20 9M21 FY 2021 9M22 Cash and cash balances 74.2 363.0 554.5 248.8 Financial assets measured at fair value through profit or loss - 42.5 36.6 31.5 a) financial assets held for trading - 8.8 4.1 1.0 b) financial assets d

  32. Slide 32: P&L Restated per Quarter 2022-21: Group

    P&L Restated per Quarter 2022-21: Group €m GROUP 1Q 2021 2Q 2021 3Q 2021 4Q 2021 1Q 2022 2Q 2022 3Q 2022 Net Interest Income (1) 41.7 39.3 46.8 66.2 50.0 58.3 59.1 Net Fee and Commission Income 22.4 23.1 25.1 23.8 23 23 23 Other Income 6.7 1.6 6.3 0.3 13.9 2.4 4.3 Net Banking Income 70.8 63.9 78.2 9

  33. Slide 33: P&L per Quarter 2022-21: Factoring & Lending

    P&L per Quarter 2022-21: Factoring & Lending €m FACTORING & LENDING 1Q 2021 2Q 2021 3Q 2021 4Q 2021 1Q 2022 2Q2022 3Q 2022 Net Interest Income 32.9 31.5 32.9 51.5 35.5 39.0 39.8 of which Net LPI over-recovery (1.2) 0.7 (2.4) 10.4 (3.2) 2.2 1.9 Net Fee and Commission Income 1.7 1.6 1.2 1.1 1.0 1.3 0.

  34. Slide 34: P&L per Quarter 2022-21: Securities Services

    P&L per Quarter 2022-21: Securities Services €m D2S 1Q 2021 2Q 2021 3Q 2021 4Q 2021 1Q 2022 2Q 2022 3Q 2022 Net Interest Income 3.0 1.5 2.1 4.2 2.7 2.3 0.5 Net Fee and Commission Income 10.9 11.4 11.7 12.1 11.8 11.7 12.1 Net Banking Income 13.9 12.8 13.9 16.4 14.5 14.0 12.6 Other Operating Income (E

  35. Slide 35: P&L per Quarter 2022-21: Payments

    P&L per Quarter 2022-21: Payments €m PAYMENT 1Q 2021 2Q 2021 3Q 2021 4Q 2021 1Q 2022 2Q 2022 3Q 2022 Net Interest Income 0.5 2.6 2.3 1.9 2.1 2.0 1.5 Net Fee and Commission Income 10.3 10.5 12.3 10.7 10.3 10.5 10.5 Net Banking Income 10.7 13.1 14.6 12.5 12.4 12.5 12.0 Other Operating Income (Expenses

  36. Slide 36: P&L Restated per Quarter 2022-21: Corporate Center

    P&L Restated per Quarter 2022-21: Corporate Center €m CORPORATE CENTER 1Q 2021 2Q 2021 3Q 2021 4Q 2021 1Q 2022 2Q 2022 3Q 2022 Net Interest Income (1) 5.4 3.7 9.5 8.6 9.7 14.9 17.3 Net Fee and Commission Income (0.5) (0.4) (0.2) (0.1) (0.2) (0.6) 0.2 Other Income (Expenses) 7.7 6.4 8.2 1.4 14.6 3.2

  37. Slide 37: bff.com

    2» BFF bff.com

BFF Bank — 9M 2022 Earnings Presentation on 6ix