Eurobank S.A. · ATHEX:EUROB
Eurobank — Eurobank EFG — Q1 2009 Earnings Presentation
33 slides from Eurobank's earnings presentation, May 28, 2009
Slide 1: First Quarter 2009 Results
SW-EUB022-2007-03-19-CMD-V7 May 28, 2009 First Quarter 2009 Results
Slide 2: Improving operating environment & sentiment
Improving operating environment & Page 2 sentiment Clear signs of stabilization in global financial markets Easing money market tensions and increase in new issuance volumes in capital markets Partial normalisation of sovereign and credit spreads Relief rally in emerging market assets Deci
Slide 3: 1Q 09 operating performance highlights
Page 3 1Q 09 operating performance highlights Evolution of pre-provision income in 1Q09 Net profit in 1Q 09 of €81m (vs. €5m in 4Q 08) 363 +67 +52 +39 +42 321* -6 Pre-provision profits at €363m up 13%* q-o-q -110 Strong loan repricing Funding cost pressure Significant gains in OpEX (-10% q
Slide 4: Prudent geographical diversification of loan book
Prudent geographical diversification of Page 4 loan book Concentration in A-rated countries New Europe portfolio mix € 47.1 bn (84% of total) Turkey 7% Turkey 8% Ukraine 5% Ukraine 2% 42.0 A-rated A-rated 34% 35% SEE 54% SEE 55% Loans Deposits € 8.4 bn A-rated countries (Poland & Cyprus): (15% of
Slide 5: Strong liquidity position
Page 5 Strong liquidity position Growth with no additional funding requirements Loan growth 12%yoy, deposits up 17%yoy, L/D ratio down to 120% +6.2bn +6.8bn 56.3 First Greek bank to successfully tap 50.1 the wholesale markets with €500 +30% 14.2 45.9 million senior unsecured issue New Europe 10.
Slide 6: Solid capital base with strong capital generation
Page 6 Solid capital base with strong capital generation Risk Weighted Assets growth (€ m) Core Tier 1 at 8.6% up 64bps from 4Q 08 Capital FY 08 (%) 1Q 09* Adequacy 3,955 Equity Tier I ratio** 7.1% 7.4% 3,214 (€3.6bn) 2,534 Core Tier I ratio 8.0% 8.6% (€4.2bn) 1,693 1,598 Tier 1 8.0% 9.9% 1,040 (€4.
Slide 7: Financial Review
Page 7 Financial Review 7
Slide 8: Loan NII at record highs
Page 8 Loan NII at record highs NII quarterly evolution 544 621 608 564 566 590 482 517 560 497 445 457 Total NII 404 417 382 342 352 322 Loan margin Interest rate gapping 11 13 17 10 3 7 4 5 -13 45 54 74 72 77 81 73 70 Capital & bonds 37 Deposit margin 74 82 92 93 88 89 80 32 -78 1Q 07 2Q 07 3Q 07
Slide 9: Expansion of loan spreads already in place – abnormal deposit spreads normalizing gradually
Page 9 Expansion of loan spreads already in place – abnormal deposit spreads normalizing gradually Evolution of Greek spreads (%) New Europe NIM 1Q08 4Q 08 1Q 09 NIM per country 9M 08 FY 08 1Q09 Sight & Savings Accounts 2.65 1.68 -0.06 Romania 4.24% 4.73% 4.53% Time & Client EMTNs 0.08 -0.41 -1.02 B
Slide 10: Commissions & Fees stabilize - on the road to recovery
Page 10 Commissions & Fees stabilize - on the road to recovery Lending fees bottom out: uptick on economic activity Mutual funds with positive sign in 1Q 09 already Increased capital markets activity evident in April / May 09 176 168 155 Lending Activities 60 81 119 113 64 Network & 42 27 42 O
Slide 11: Asset quality evolution
Page 11 Asset quality evolution NPL Ratio (% of loans) Group Impairment charges 240* 3.23% 3.02% 2.76% 2.74% 1.07 1.07 1.12 1.67 1.89 2.40% 2.45% 3.01% 263 2.06% 233 New Europe 1.30% 1.30% 151 FY 05 FY 06 FY 07 1Q 08 FY 08 1Q 09 136 127 1Q 08 2Q08 3Q08 4Q08 1Q09 1Q 08 1H 08 9M 08 FY 08 1Q 09 €m quar
Slide 12: Strong cost performance: on track to meet the -5% target
Strong cost performance: on track to meet Page 12 the -5% target Cost evolution Cost growth in negative territory -3.4% 26.1 25.8 27.5 24.4 22.4 20.7 -9.7% 15.7 11.1 10.9 11.3 401 401 8.6 7.9 389 Group 4.8 375 3.1 Greece 27 45 362 29 33 Depr. 33 -3.4 159 -5.8 144 140 161 1H 07 9M 07 FY 07 1Q 08 1H 0
Slide 13: Greece continues operating at a lower cost base
Page 13 Greece continues operating at a lower cost base vs. 2008 Evolution of Greek costs in 2008 and 2009 (€ m) -13m - 5.8% + 27m + 3.1% +18 +15 897 870 211 (3) (4) 17 (8.7%) Depr. (13) Δ 1Q 08 Δ 2Q 08 Δ 3Q 08 Δ 4Q 08 vs. 1Q 07 vs. 2Q 07 vs. 3Q 07 vs. 4Q 07 Δ 1Q 09 vs. 1Q 08 66 (11.5%) Admin. 132 (
Slide 14: New Europe 1Q 09 cost growth at zero
Page 14 New Europe 1Q 09 cost growth at zero NE OpEx evolution Employees – period end + 0.0% 12 9 150.4 21 150.6 Depr. 14,466 14,355 14 16 +16.7% 14,178 82.4 13,878 84 80 Admin. 81 77.4 70 71 +1.3% 13,055 75.8 Cost / Income (%) 11,825 11,589 66.2 79 85 65.0 Staff 67 68 -4.5% 63.6 64.1 64.3 64 11,087
Slide 15: New Europe (excl. Ukraine) remains profitable
Page 15 Despite the pressure on funding cost and asset quality, New Europe (excl. Ukraine) remains profitable New Europe New Europe profits q-o-q Growing pre-provision income + 9% 84 18.6 77 6.8 PAT (excl. Ukraine) 2.0 -11.2 Total PAT Q1 08 Q1 09 Q4 08 Q1 09 15
Slide 16: Pre-provision profit bounces back, more recovery expected
Page 16 Pre-provision profit bounces back, more recovery expected in future quarters Pre-provision profit Factors to aid pre-provision profit -12% Net interest income: +13% Asset repricing and de-escalating of 411 409 410 deposit pricing already evident in Q2 09 363 321* Fees: Increased lending busi
Slide 17: Sustainable pre-provision profit, able to withstand and absorb shocks
Page 17 Sustainable pre-provision profit, able to withstand and absorb shocks Evolution of pre-provision profit in 2008/09 +240 +381 Pre-emptive provisions -16 1,551 1,462 -65 Δ Fees Δ OpEx Δ ΝΙΙ Δ Fees Δ Non -212 Δ ΝΙΙ core Δ OpEx income FY07 FY08 FY09 17
Slide 18: Management priorities during the crisis
Page 18 Management priorities during the crisis To sustain and improve pre-provision earnings capacity (loan margins, fee business, cross-selling and cost containment) To further strengthen the risk management process (underwriting, collection, conservative provisioning policy) To improve the
Slide 19: Segmental Performance
Page 19 Segmental Performance 19
Slide 20: 1Q 09 PBT after minorities at € 96m – up 16% from 4Q 08
Page 20 1Q 09 PBT after minorities at € 96m – up 16% from 4Q 08 PBT* per Segment Group PBT* Share of profits 9.8% 81.5% 2.7% 21.6% -33.3% +16% 96 83** 78 1Q 09 22 9 3 4Q 08 1Q 09 -32 Retail Corporate Wealth Global & Capital New Europe Management Markets * after minority interest excluding one -offs
Slide 21: Retail – repricing gains and cost control neutralized by funding cost and provisions
Page 21 Retail – repricing gains and cost control neutralized by funding cost and provisions Quarterly PBT evolution (€ m) 104 90 84 4Q 08/1Q 09 growth (2%) (7%) 17% -66% 28 9 308 301 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 FY 08 1Q 09 151 140 152 130 – Cost to Income 46.2% 46.5% – Return on Equity 29.7% 4.0%
Slide 22: Corporate – strong performance based on repricing, cost control and asset quality
Page 22 Corporate – strong performance based on repricing, cost control and asset quality Quarterly PBT evolution (€ m) 78 63 64 65 66 4Q 08/1Q 09 11% (5%) (1%) 18% growth 111 101 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 78 66 FY 08 1Q 09 – Cost to Income 28.8% 24.0% – Return on Equity 23.4% 26.4% 28 27 – Retu
Slide 23: Wealth Management – repositioning and costs control
Page 23 Wealth Management – repositioning and costs control Quarterly PBT evolution (€ m) 25 14 4Q 08/1Q 09 9 growth 14% (5%) 3 0 18 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 16 15 15 FY 08 1Q 09 – Cost to Income 56.4% 84.2% 3 – Return on Equity 35.9% 7.5% – Share of profits 17.9% 2.7% -0.3 Revenues Expenses Pr
Slide 24: Global & Capital Markets – Strong securities results
Page 24 Global & Capital Markets – Strong securities results Quarterly PBT evolution (€ m) 53 56 45 4Q 08/1Q 09 26 growth (18%) (22%) (16%) 22 47 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 39 26 FY 07 1Q 08 22 21 – Cost to Income 29.8% 42.0% 16 – Return on Equity 42.3% 19.9% – Share of profits 66.5% 22.6% Revenu
Slide 25: New Europe: cost cutting well on track vs. increased funding cost & provisions
Page 25 New Europe: cost cutting well on track vs. increased funding cost & provisions Quarterly PBT evolution (€ m) 45 37 23 4Q 08/1Q 09 (10%) (9%) 8% growth -18 -32 253 228 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 175 160 FY 08 1Q 09 96 103 – Cost to Income 68.4% 70.0% – Return on RwA 0.75% -0.92% – Share of
Slide 26: Appendices
Page 26 Appendices 26
Slide 27: Financial Ratios
Page 27 Financial Ratios Financial Ratios 1Q 09 1Q 08 Net Interest Margin 2.65% 3.22% Cost-Income 50.0% 47.7% NPLs (% of loans) 3.23% 2.45% NPLs coverage* 77.6% 86.0% Provision Charge (% of net loans) 1.89% 1.07% Tier Ι Ratio 9.85% 8.46% Total Capital Adequacy 11.32% 11.29% ROA after tax 0.41% 1.25%
Slide 28: Summary Figures
Page 28 Summary Figures Summary Figures (€ m) 1Q 09 1Q 08 Δ% New Europe Net Interest Income 543.9 565.9 -3.9% 187.8 Net fees & Commissions 94.6 148.7 -36.4% 35.8 Insurance and Non banking fees 18.5 19.3 -4.1% 1.5 Total Operating Income 724.6 785.6 -7.8% 234.3 Operating Expenses 362.0 374.8 -3.4% 150
Slide 29: Key figures of New Europe operations
Page 29 Key figures of New Europe operations Romania Bulgaria Serbia Cyprus Poland Turkey Ukraine NE Δ% Total Assets 6,066 4,092 1,797 1,582 4,711 2,059 830 21,143 34% Balance Sheet Total Loans 3,758 3,223 1,095 445 3,915 1,044 762 14,243 30% Total Deposits 2,358 1,786 694 1,107 2,054 727 211 8,924
Slide 30: Key regional macroeconomic data
Page 30 Key regional macroeconomic data GDP growth (%) CPI (%) Public Debt / GDP Current Account / Unemployment (%) GDP (%) (%) 2009e 2010f 2009e 2010f 2009e 2010f 2009e 2010f 2009e 2010f EU (4.0) (0.1) 0.9 1.3 72.6 79.4 (1.6) (1.7) 9.4 10.9 Greece (0.9) 0.1 1.8 2.3 103.4 108.0 (11.5) (11.4) 9.1 9.7
Slide 31: 1Q 2009 – Summary per Segment
Page 31 1Q 2009 – Summary per Segment Segmental Results 1Q 09 Wealth Treasury & Capital Capital & Elimination Total (€ m) Retail Corporate Management Markets Other Center New Europe Interest income 271 91 -1 1 0 0 182 544 Net fee & commission income 12 11 9 26 0 0 36 95 Net Insurance income 0 0 11 0
Slide 32: 1Q 2008 – Summary per Segment
Page 32 1Q 2008 – Summary per Segment Segmental Results 1Q 08 Wealth Global & Capital Capital & Elimination Total (€ m) Retail Corporate Management Markets Other Center New Europe Interest income 299 72 9 27 10 0 149 566 Net fee & commission income 12 10 21 44 0 0 62 149 Net Insurance income 0 0 12
Slide 33: Contacts
Page 33 Contacts EFG Eurobank Ergasias, 20 Amalias Avenue, 105 57 Athens, Greece Fax: +30 210 3337 160 E-mail: investor_relations@eurobank.gr Internet: www.eurobank.gr Reuters: EFGr.AT Bloomberg: EUROB GA Investor Relations Dimitris Nikolos Tel: +30 210 3337688 E-mail: dnikolos@eurobank.gr Yanni