Erste Group Bank Ag · VIE:EBS
Erste Group Bank — H1 2018 Earnings Presentation
16 slides from Erste Group Bank's earnings presentation, Jul 31, 2018
Slide 1: H1 2018 results presentation
ERSTES Group H1 2018 results presentation Strong net profit of EUR 774 mn based on improved operating performance and benign risk environment
Slide 2: Strong economic outlook for Erste Group's markets
Business environment Strong economic outlook for Erste Group's markets RealcpPgrowtn(ins) |) Wage grow (avin) | Summa > CEE macroeconomic growth set to be well above Euro- area in both 2018 and 2019 > Real wage growth driven by continued strong economic growth and low unemploy- ment @ azois Source:
Slide 3: Sustainable CEE public debt outlook well below Eurozone average
Business environment Sustainable CEE public debt outlook well below Eurozone average Gross public debt (% of GDP) 1318 132.0 125.7 Maastricht ‘Average for limit for Eurozone 108.2 109.5 108.5 public debt (2017) 97.0 98.3 78.0 78.4 736 736 72.9 641 613 61.0 60.4 57.3 _ 55.6 551 50.6 50.9 45.9 34.6 35
Slide 4: Rising interest rates across CEE
Business environment Rising interest rates across CEE Austria 0.57 One) ed 0.72 ._—> ——— 1-617 1-618 11s a2 18 > ECB cut discount rate to zero in March 16 > Maintains expansionary monetary policy stance Slovakia w= _—..., 0.85, 0.81 0.77 1-617 1-618 lis 218 > As part of euro zone ECB rates are appli
Slide 5: Net profit of EUR 774mn based on improved operating performance
Business performance Net profit of EUR 774mn based on improved operating performance Qo0 net profit reconciliation (EUR mn) +30.4% 1 438 pemems) 6 aT 36 336 4 Q118 Operating Operating Risk Other Taxes on Minorities Q218 income expenses costs result income ERSTES Group YoY net profit reconciliation (
Slide 6: 7.1% YoY loan growth and continued customer deposits inflow, up 7.7%
Business performance 7.1% YoY loan growth and continued customer deposits inflow, up 7.7% Group AT/EBOe AT/SB cz RO SK HU HR RS Customer loans (net; EUR bn) 30. 314 3s 40.1 411 42.1 24.0 25.0 26.5 721 72 a 75 10.9 ERSTES Group Customer deposits (EUR bn) 42.6 a 32.4 3 35.3 10.4 13 3 1 Loan / deposit
Slide 7: Strong retail loan growth of 6.5% YoY
Business performance Strong retail loan growth of 6.5% YoY Retail Highlights for H1 2018 NEWLY-GRANTED MORTGAGES +6.1% YoY INFLOW OF RETAIL DEPOSITS +8.0% YoY EUR 3.87bn ‘fi EUR 7.92bn & provided to over 51,000 households continued inflow in all markets CONSUMER LENDING +8.7% YoY BANCASSURANCE VOLUM
Slide 8: Digital sales with growing contribution to overall lending growth
Business performance Digital sales with growing contribution to overall lending growth
Slide 9: George is the digital assistant of over 2.6 million customers
Business performance George is the digital assistant of over 2.6 million customers > Twonew markets added in H1 2018: > Czech clients use George app 6x more than previous offering > most downloaded bank app in Slovakia > Austria's leader in digital banking: 80% YoY more active i users of George app
Slide 10: Corporate loan growth driven by large companies and SMEs
Business performance Corporate loan growth driven by large companies and SMEs TOTAL GROSS LOANS H1 2018 Corporate Highlights TOP PERFORMING SUBSIDIARIES* EUR 51.2bn & up 6.1% YoY SME LENDING Slovakia +21.5% Hungary +16.7% TOP GROWTH SECTORS* IN OUR PORTFOLIO Czechia +14.1% 10.3% YoY loan volume grow
Slide 11: Higher operating revenues due to strong NII and fees
Business performance Higher operating revenues due to strong NII and fees Operating revenues (EUR mn) 3,293 3.374 103 12 1-617 1-618 Net interest income Net fee and commission income @ Net trading result Other income ERSTES Group Operating expenses (EUR mn) — 36% —4 2,004 2,076 23: 232 1-617 1-618 P
Slide 12: Operating result higher in most markets
Business performance Operating result higher in most markets Group AT/EBOe AT/SB cz RO SK HU HR RS Operating result (EUR mn) 195 203 223 204 bl 137 148 148 85 88 101 105 1,289 1298 340 363
Slide 13: Continued releases of risk provisions
Business performance Continued releases of risk provisions Absolute (EUR mn) Relative (%) * Performance summary Group 23 ie -0.12 oe > YoY improvement due to con- ra aes tinued asset quality improve- AT/EBOe a) -0.07 ments, particularly in Corpo- a ans rate business (esp. in HR); net AT/SB 6 -0.02 r
Slide 14: NPL ratio improves to 3.6%, lowest level in ten years
Business performance NPL ratio improves to 3.6%, lowest level in ten years NPL volume (EUR mn) NPL ratio (%) NPL coverage (excl collateral; %) Group f saa 36. 72.0 AT/EBOe ez rey ai 63.0 AT/SB ie ao eis cz 303 20 363 RO 539" 67 983 sk isa 38 303 HU 3 47 72° HR ra my i753 RS 2 ZOE wf 12.8 pec? Jung E
Slide 15: Excellent capital generation across the years
Business performance Excellent capital generation across the years oo a ” - “ - - - DEC 2009 DEC 2010 DEC 2011 DEC 2012 DEC 2013 DEC 2014 DEC 2015 DEC 2016 DEC 2017 JUN 2018 > The decline in H1 2018 was mainly attributable to one-time effects (buy-out of last large minority shareholder in BCR and cu
Slide 16: Outlook
Outlook Macro outlook 2018 > Real GDP growth of approx. 3-4% expected in 2018 in CEE and Austria > Real GDP growth to be driven by solid domestic demand, as real wage growth and low unemployment support economic activity in CEE => Solid public finances across CEE ERSTES Group Business outlook 2018 >