Banco Santander-chile · BCS:BSANTANDER
Banco Santander-chile — Q2 2021 Earnings Presentation
40 slides from Banco Santander-chile's earnings presentation, Jul 29, 2021
Slide 1: 2Q21 Results Banco Santander Chile
2Q21 Results Banco Santander Chile July 29, 2021
Slide 2: Important information
Important information Banco Santander Chile caution that this presentation contains forward looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995. These forward looking statements are found in various places throughout this presentation and include, without
Slide 3: Agenda
AGENDA MACRO & COVID-19 UPDATE SAN CHILE: BALANCE SHEET AND RESULTS SAN CHILE: STRATEGIC INITIATIVES UPDATE 3 3
Slide 4: Contagions have receded amid successful vaccination strategy
Macroeconomic environment Contagions have receded amid successful vaccination strategy New contagions (7 days rolling) PCR Positive rate (%) 8,000 50 45 Met. Area Total 7,000 40 6,000 35 5,000 30 4,000 Rest of the 25 country 20 3,000 15 2,000 10 1,000 Metropolitan area 5 3,2 3,0 0 0 Apr-20 Jun-20 Au
Slide 5: Improvement in terms of trade and better economic activity
Macroeconomic environment Improvement in terms of trade and better economic activity Copper prices Mobility and activity Index 2013 = 100 190 120 120 170 115 100 150 154.1 110 80 130 105 60 110 100 40 90 95 20 Index (Dec-2019 = 100) Monthly activity SA Mobility index (rhs) 70 90 0 Jan-20 Apr-20 Jul-
Slide 6: GDP to grow 7.5-8.5% in 2021
Macroeconomic environment GDP to grow 7.5-8.5% in 2021 GDP growth Inflation Annual growth % Annual change in UF inflation, % 3.9 7.5-8.5 3.2 2.7 2.7 2.0-3.0 1.1 -5.8 2019 2020 2021 (f) 2022 (f) 2019 2020 2021 (f) 2022 (f) Monetary Policy Rate %, eop 2.25 1.75 1.25 0.75 0.50 2019 2020 Jul-21 2021 (f)
Slide 7: Agenda
AGENDA MACRO & COVID-19 UPDATE SAN CHILE: BALANCE SHEET AND RESULTS SAN CHILE: STRATEGIC INITIATIVES UPDATE 7 7
Slide 8: Strong results in 2Q21. ROE at 21.6%
Balance sheet & results Strong results in 2Q21. ROE at 21.6% Quarterly net income attributable to shareholders Quarterly ROAE Ch$mn +118.6% 2.1% 21.6% 20.4% 20.4% 183,435 181,713 185,478 105,139 11.5% 84,859 9.5% 2Q20 3Q20 4Q20 1Q21 2Q21 2Q20 3Q20 4Q20 1Q21 2Q21 Three consecutive quarters with ROE o
Slide 9: Surpassing the competition
Balance sheet & results Surpassing the competition Net interest margin Efficiency YTD, as of May 2021 YTD, as of May 2021 54.2% 4.2% 48.3% 47.9% 43.9% 3.7% 3.6% 3.4% 3.7% 37.4% Competitors Competitors ROE YTD June 2021 21.0% 17.0% 13.8% 13.6% Source: Ratios calculated by Santander Chile based on dat
Slide 10: NII increases 13.1% YTD
Balance sheet & results NII increases 13.1% YTD NIM1 & Inflation Net interest income 5.0% 4.3% 4.2% 4.2% Ch$ bn 6M21 YoY QoQ 4.0% 3.8% 3.7% Net interest income 869 13.1% 1.6% 3.0% Avg. Int. earning assets 41,577 7.4% 0.5% 2.0% 1.3% Average loans 34,445 0.9% 0.0% 1.1% 1.1% 1.0% Int. earning asset yie
Slide 11: Stronger growth in NII and better evolution of NIM net of risk
Balance sheet & results Stronger growth in NII and better evolution of NIM net of risk Net interest income1 Net interest margin Ch$ billion, rolling 12 months YTD, as of May 2021 4.2% 1,800 -0.1% 3.7% 3.6% 3.4% 3.7% 7,050,000 1,700 6,850,000 1,600 6,650,000 ~Ch$381 billion System 1,500 (US$520 6,450
Slide 12: Non-interest bearing demand deposits up 42.8% YoY
Balance sheet & results Non-interest bearing demand deposits up 42.8% YoY Total Deposits Ch$bn +11.0% Ch$ bn 06M21 YoY QoQ +12.0% Demand deposits 17,722 42.8% 12.8% 29,478 Time deposits 11,756 (16.9%) 10.9% 26,556 25,686 25,143 26,317 Total Deposits 29,478 11.0% 12.0% Mutual funds1 8,301 6.6% 1.9% L
Slide 13: Improved funding mix & outpacing competitors
Balance sheet & results Improved funding mix & outpacing competitors Market share in demand deposits1 Demand deposits by segment Ch$ bn 06M21 YoY QoQ 22.5% 21.4% Individuals 7,002 64.9% 17.7% 21.1% SMEs 3,098 30.4% 10.3% 13.0% Retail 10,100 52.5% 15.3% 8.8% 4.6% Middle Market 4,364 23.2% 12.1% Corpo
Slide 14: Loan growth remains subdued due to high liquidity & lockdowns
Balance sheet & results Loan growth remains subdued due to high liquidity & lockdowns Total Loans Ch$ bn 6M21 YoY QoQ Ch$bn Individuals1 19,903 4.7% 1.3% -1.7% Consumer 4,772 (5.8%) (1.1%) +0.5% SCF 2 554 29.1% 9.8% 35,288 34,880 34,409 34,507 34,678 Mortgages 12,971 8.7% 2.3% SMEs 4,925 4.8% (1.3%)
Slide 15: Asset quality evolution remains solid
Balance sheet & results Asset quality evolution remains solid Total loans Commercial loans % of loans % of loans 252% 248% 154% 155% 5.3% 4.9% 6.3% 6.5% 1.9% 1.3% 2.2% 1.8% Jun-20 Sep-20 Dec-20 Mar-21 Jun-21 Jun-20 Sep-20 Dec-20 Mar-21 Jun-21 NPL(1) Impaired (2) Coverage ratio (3) NPL(1) Impaired (2
Slide 16: Positive evolution of asset quality of COVID-19 Solutions
Balance sheet & results Positive evolution of asset quality of COVID-19 Solutions Total Covid Solutions Ch$10,735 bn Fogape Covid Payment holiday granted Ch$2,411 bn (22%) Ch$8,324 Bn (78%) With payment Without payment With payment Payment holiday holidays holidays holidays expired Ch$ 84 bn (3%) Ch
Slide 17: Cost of risk of 1.1% in 2Q21 includes Ch$18bn in additional provisions
Balance sheet & results Cost of risk of 1.1% in 2Q21 includes Ch$18bn in additional provisions Quarterly cost of risk1 Provision for loan losses % 2.2% Ch$ bn 06M21 YoY QoQ 1.5% Gross provisions (219.7) (33.4%) (62.5%) and write-offs 1.0% 1.0% 1.1% Recoveries 35.7 (0.6%) (52.4%) Provisions (184.0) (
Slide 18: Fee growth continues to accelerate
Balance sheet & results Fee growth continues to accelerate Fees & financial transaction Fees Ch$bn Ch$ bn 6M21 YoY QoQ Card fees 44.0 48.6% 3.6% +12.8% Getnet 1.0 --% 2,811.6% 139.5 Asset management 22.5 (0.8%) 1.5% 118.3 Insurance brokerage 20.8 (11.2%) 3.3% 99.1 105.0 73.1 Guarantees, cont. op. 18
Slide 19: Efficiency at 37.5% YTD. Cost growth under control
Balance sheet & results Efficiency at 37.5% YTD. Cost growth under control Operating expenses Ch$bn Ch$ bn 6M21 YoY QoQ 00 60.0%Personnel +3.4% 200.7 (0.9%) 7.1% expenses 50 55.0%Administrative 201 135.7 6.2% (4.5%) 194 192 190 194 expenses 00 50.0% Depreciation 58.3 5.5% 10.3% 50 41.5% 45.0%Operati
Slide 20: BIS ratio at 14.7% as phase-in of BIS III begins
Balance sheet & results BIS ratio at 14.7% as phase-in of BIS III begins Core capital & BIS Ratio BIS III phase-in begins: • Tier I: AT1 temporarily 15.4% 14.7% comprised of subordinated 14.6% bonds 4.7% 3.1% • Minority interest included as 4.6% 1.5% core capital • 60% payout of 2020 earnings paid i
Slide 21: Well above estimated minimum BIS III / CET1 requirements
Balance sheet & results Well above estimated minimum BIS III / CET1 requirements Jun. 2021 Min. Min. Min. Min. Min. Banco Santander Chile Actual 2021e 2022e 2023e 2024e 2025e Min CET1 4.8% 4.5% 4.5% 4.5% 4.5% Systemic charge 1 1.5% 1.1% 0.9% 1.1% 1.4% Conservation buffer 0.6% 1.3% 1.9% 2.5% 2.5% Pil
Slide 22: Agenda
AGENDA COVID19: REGULATORY AND MACRO UPDATE SAN CHILE: BALANCE SHEET AND RESULTS SAN CHILE: STRATEGIC INITIATIVES UPDATE 22 22
Slide 23: Strategic priorities
Strategic initiatives Strategic priorities Declaration Our Our vision We want to be the best bank for our customers, leading in purpose Be the best Bank digital excellence and experience, gaining their loyalty Help people acting responsibly and gaining the Clients and businesses to loyalty of our pr
Slide 24: ESG Update
Strategic initiatives ESG Update Improving ESG rating We improved our overall ESG score under We are the first bank to be certified by the FTSE4Good, increasing our scores under the Ministry of Women and Gender Equality Social and Governance pillars. Our ESG scores are above the average for the indu
Slide 25: Santander Chile ESG Talk
Santander Chile ESG Talk SAVE THE DATE THURSDAY, OCTOBER 14, 2021 …with the participation of Board members and Bank executives 25 25
Slide 26: Change the Bank
Strategic initiatives Maintain a high level of consumer Transform the Bank into a platform satisfaction, increase the productivity of all allowing clients to use the bank as a channels, and be more efficient and channel or as a software provider to profitable. develop business. Give access to digita
Slide 27: Record growth in Life and Superdigital accounts
Strategic initiatives Record growth in Life and Superdigital accounts Life Superdigital Digital product for unbanked population Prepaid digital product for the unbanked that seeks to be part of Bank, receiving population seeking a low-cost bank merits for positive financial behavior account (through
Slide 28: Successful launch of Getnet
Strategic initiatives Successful launch of Getnet Acquiring network that uses the four-part model to operate, offering a payments solution to businesses Pays instantaneously Clients will be able to receive money from their sales in a Santander account up to five times in one day, including holidays.
Slide 29: Insuretech platforms driving insurance brokerage fee rebound
Strategic initiatives Insuretech platforms driving insurance brokerage fee rebound An online platform that compares An online platform that compares insurance between different providers in insurance between different providers in a quick and transparent way. a quick and transparent way. Insurance p
Slide 30: Productivity continues to rise
Strategic initiatives Productivity continues to rise Points of Sale Productivity per point of sale Productivity per employee Volumes1 per point of sale, Ch$mn Volumes1 per point of sale, Ch$mn -6.3% +10.7% +11.7% 367 344 186,500 168,513 34 13 6,265 53 5,608 59 280 272 Jun-20 Jun-21 Jun-20 Jun-21 Jun
Slide 31: Number 1 in NPS
Strategic initiatives Number 1 in NPS Net Promoter Score (NPS)1 56 54 51 47 51 48 50 41 45 45 45 42 38 36 34 Jun-20 Sep-20 Dec-20 Mar-21 Jun-21 Santander Comp 1 Comp 2 Opening up the gap between us and our peers 31 31 1. Source: Study by Activa for Santander with a scope of 60,000 surveys to our own
Slide 32: Strong rise in account market share
Strategic initiatives Strong rise in account market share Net current account openings, LTM April 2021 Advantage in 501,755 9x 26x 14x 2x1 checking account opening1 217,535 55,403 19,102 36,906 Santander Banco de BCI Itaú Total system Chile Corpbanca without Santander Current account market share Sa
Slide 33: Higher productivity, digital products and improved NPS leads to record growth in clients
Strategic initiatives Higher productivity, digital products and improved NPS leads to record growth in clients Total Clients Jun-20 Jun-21 Current accounts (including Superdigital) Digital Clients +13% 3,893,309 Loyal Clients +39% +45% +8% 1,867,167 1,848,457 777,664 1,339,361 3,461,403 1,278,235 72
Slide 34: Updating guidance for 2021
Conclusions Updating guidance for 2021 ✓Loan growth low single digits accelerating as year progresses, especially personal loans ✓NIMs at 4.1% ✓Cost of credit at 1.0%-1.1% ✓Fee income growth 8%-10% accelerating with reopening ✓Costs growing in line with inflation. Efficiency ~38% ✓Effective tax rate
Slide 35: Thank you.
Thank you. Our purpose is to help people and business prosper. Our culture is based on believing that everything we do should be: 35
Slide 36: Annexes
Annexes « Santander
Slide 37: Annexes: Unaudited Balance Sheet
Annexes Unaudited Balance Sheet Jun-21 Jun-21 Jun-20 Jun-21/Jun-20 US$ Ths1 Ch$ Million % Chg. Cash and deposits in banks 10,261,328 7,512,113 3,776,118 98.9% Cash items in process of collection 1,421,179 1,040,417 375,238 177.3% Trading investments 59,850 43,815 208,237 (79.0%) Investments under re
Slide 38: Annexes: Income Statement
Annexes Jun-21 Jun-21 Jun-20 Jun-21/Jun-20 US$ Ths1 Ch$ Million % Chg. Interest income 1,663,433 1,217,766 1,153,152 5.6% Interest expense (476,274) (348,671) (384,510) (9.3%) Net interest income 1,187,159 869,095 768,642 13.1% Fee and commission income 351,274 257,161 226,967 13.3% Fee and commissi
Slide 39: Annexes: Quarterly Income Statement
Annexes 2Q21 2Q21 1Q21 2Q20 2Q21/2Q20 2Q21/1Q21 US$ Ths1 Ch$ Million % Chg. Interest income 824,149 603,343 614,423 512,718 17.7% (1.8%) Interest expense (225,993) (165,445) (183,226) (132,375) 25.0% (9.7%) Net interest income 598,156 437,898 431,197 380,343 15.1% 1.6% Fee and commission income 179,
Slide 40: Annexes: Key Indicators
Annexes: Key Indicators Profitability and efficiency 06M21 06M20 Change bp Net interest margin (NIM) 1 4.2% 4.0% 21 Efficiency ratio2 37.5% 39.7% -216 Return on avg. equity 21.0% 13.0% 799 Return on avg. assets 1.3% 0.8% 51 Core Capital ratio 9.8% 10.0% -15 BIS ratio 14.7% 14.6% 10 Return on RWA 2.2
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