Slide 1: Results of mBank Group Q1 2015
Results of mBank Group Q1 2015 Strong results despite market headwinds Management Board of mBank S.A. Investor Presentation April 29, 2015
Slide 2: Key highlights of Q1 2015
Key highlights of Q1 2015 Core revenues of PLN 781.3 M under continued pressure Total revenues increased • NII at PLN 587.4 M (-0.6% YoY), to PLN 1,118 M amid record low interest rates • NFC at PLN 193.9 M (-19.7% YoY), Profit & Loss due to reduced interchange fees Sound volume development • Gross l
Slide 3: Agenda
Agenda Summary of Q1/15 in mBank Group Key Financials Client acquisition and Market shares Development of retail and corporate business Analysis of Q1/15 Results Development of Loans and Deposits Development of Income and Costs Loan Portfolio Quality Funding Structure Details Capital and Liquidity R
Slide 4: Key Financials: Profit and Loss Account
Summary of Q1/15 Results in mBank Group mBank Analyzer Key Financials: Profit and Loss Account in PLN M Q1/15 Q1/14 Change YoY Q4/14 Net interest income 587.4 591.0 -0.6% 632.5 Net Fee & Commission income 193.9 241.4 -19.7% 200.4 1 Total income 1,118.1 956.6 +16.9% 939.9 Total costs (452.8) (430.6)
Slide 5: Key Financials: Balance Sheet
Summary of Q1/15 Results in mBank Group mBank Analyzer Key Financials: Balance Sheet in PLN M Q1/15 Q1/14 Change YoY Q4/14 Gross loans to customers 81,883 73,390 +11.6% 77,373 Retail client loans 43,788 38,973 +12.4% 41,560 1 Core corporate client loans 29,728 26,957 +10.3% 29,002 Amounts due to cus
Slide 6: Business Development: Client acquisition and Market shares
Summary of Q1/15 in mBank Group Business Development: Client acquisition and Market shares Number of Retail Clients (thou.) Number of Corporate Clients +8.5% +9.2% +2.4% +1.9% 4,689 4,803 17,390 17,787 18,133 4,565 16,600 17,006 4,427 4,490 41 94 1,794 1,838 1,839 767 1,710 1,778 688 704 725 762 4,8
Slide 7: Development of Retail and Corporate business
Summary of Q1/15 in mBank Group Development of Retail and Corporate business Sales of Mortgage Loans Sales of Non-Mortgage Loans (PLN M, by quarter) (PLN M, by quarter) +37% +12% 0% +3% 909 825 833 834 1,171 1,164 1,204 247 1,072 1,077 82 7% 198 234 28% 102 81 609 272 8% 82 90 205 276 23% 95 232 173
Slide 8: Agenda
Agenda Summary of Q1/15 in mBank Group Key Financials Client acquisition and Market shares Development of retail and corporate business Analysis of Q1/15 Results Development of Loans and Deposits Development of Income and Costs Loan Portfolio Quality Funding Structure Details Capital and Liquidity R
Slide 9: Development of Loans to Customers
Analysis of Q1/15 in mBank Group mBank Analyzer Development of Loans to Customers Loans in both segments continue to see the benefits of economic growth Development of Gross Loans and Advances to Customers (PLN M) +10.8% +11.6% +10.3% +7.6% +8.0% +5.8% +2.5% +4.0% 35,340 31,884 30,564 31,535 32,841
Slide 10: Development of Deposits
Analysis of Q1/15 in mBank Group mBank Analyzer Development of Deposits Continued growth of balances on current and saving accounts Development of Amounts due to Customers (PLN M) +9.8% +13.0% +8.5% -4.4% +12.7% -0.8% -9.7% -2.8% 31,576 32,237 30,816 72,422 71,861 28,069 26,595 3,738 69,564 4,367 5,
Slide 11: Income of mBank Group
Analysis of Q1/15 in mBank Group mBank Analyzer Income of mBank Group Core revenues under market pressure Development of mBank Group’s Income (PLN M) +16.9% +19.0% -3.4% QoQ YoY -1.7% 1,118.1 39.2 1,023.8 1,018.9 956.6 939.9 4.1 45.8 3.5 36.7 195.0 9.8 22.2 110.2 96.3 34.5 1.0 92.1 2.8 16.2 70.5 +45
Slide 12: Costs of mBank Group
Analysis of Q1/15 in mBank Group mBank Analyzer Costs of mBank Group Stable cost base on a recurrent basis Development of mBank Group’s Costs (PLN M) +5.2% +1.4% +2.1% -1.7% QoQ YoY 455.3 452.8 441.2 443.5 430.6 17.7 17.7 17.7 34.1 17.7 48.6 45.8 47.7 47.9 47.1 12.3 6.6 11.8 7.3 11.6 -1.6% +2.8% 146
Slide 13: Loan Loss Provisions & Risk Costs
Analysis of Q1/15 in mBank Group Loan Loss Provisions & Risk Costs Provisioning level reflecting strong financial standing of clients and portfolio charges related to higher CHF/PLN rate Net Impairment Losses on Loans and Advances mBank Group’s Cost of Risk by Segment (PLN M) (bps) 88 89 155.9 157.9
Slide 14: Loan Portfolio Quality
Analysis of Q1/15 in mBank Group Loan Portfolio Quality Improved portfolio quality, NPL ratios reflecting market’s most conservative recognition methodology mBank Group’s Impaired Loans Portfolio mBank Group’s NPL Ratio (PLN M) +10.0% 6.4% 6.3% 6.4% mBank Group applies +1.0% 6.1% 6.1% a conservative
Slide 15: Funding Structure Details
Analysis of Q1/15 in mBank Group Funding Structure Details A well diversified and safe funding base mBank Group’s funding structure mBank’s ratings Loan to Deposit Ratio as of 31.03.2015 Fitch 111.5% Retail 110.8% Other 109.9% 6% 36% deposits Long-term rating A Subordinated liabilities 4% Short-term
Slide 16: Key Regulatory Ratios
Analysis of Q1/15 in mBank Group Key Regulatory Ratios Strong capital position and liquidity above regulatory requirements mBank Group’s Total Capital Ratio mBank’s NSFR and LCR Including full 2014 profit retention 174% 17.9% 16.3% 16.3% 149% 15.8% 15.6% 3.4% 14.7% 138% 2.7% 3.4% 2.6% 2.5% 127% 2.5%
Slide 17: Agenda
Agenda Summary of Q1/15 in mBank Group Key Financials Client acquisition and Market shares Development of retail and corporate business Analysis of Q1/15 Results Development of Loans and Deposits Development of Income and Costs Loan Portfolio Quality Funding Structure Details Capital and Liquidity R
Slide 18: Macroeconomic Update (1/2)
Macroeconomic Update (1/2) Inflation to stay extremely low. Economic growth set to accelerate. GDP forecast (% YoY) Nominal YoY GDP growth remains very low by historical standards mBank’s 8 forecast 14% 6 4.6 4.5 4.8 5.1 4.3 12% 3.7 3.5 3.6 3.3 3.3 3.3 3.7 3.9 4 2.2 2.7 10% 2.0 1.3 0.8 8% 2 0.2 0.4
Slide 19: Macroeconomic Update (2/2)
Macroeconomic Update (2/2) Strong growth in corporate loans, cautious borrowing by households Corporate loans and deposits (% YoY) Household loans and deposits (% YoY) 30% 25% 20% 20% 15% 10% 10% 5% 0% 0% -10% -5% Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jan-10 Ju
Slide 20: 2015 in forecasts and the impact on mBank Group
2015 in forecasts and the impact on mBank Group Macroeconomic environment and challenges for the banking sector Key economic indicators Impact on mBank 2013 2014 2015F Net interest income & NIM (Negative) GDP growth (YoY) 1.7% 3.4% 3.5% • MPC decision on reduction of interest rates in March Domestic
Slide 21: Agenda
Agenda Summary of Q1/15 in mBank Group Key Financials Client acquisition and Market shares Development of retail and corporate business Analysis of Q1/15 Results Development of Loans and Deposits Development of Income and Costs Loan Portfolio Quality Funding Structure Details Capital and Liquidity R
Slide 22: Appendix
Appendix Page Page Additional Information: Selected Financial Data No. Detailed Results of the Business Lines No. Consolidated Profit and Loss Account 23 Retail Banking 38-43 Consolidated Statement of Financial Position 24 Summary of Q1/15: Financial Results and Volumes 39-40 mBank Group’s Ratios 25
Slide 23: Consolidated Profit and Loss Account
Summary Appendix mBank Historical view Profit & Loss Balance Sheet Analyzer Additional Information: Selected Financial Data Business Lines Subsidiaries Consolidated Profit and Loss Account Quarterly results (PLN thou.) Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Net interest income 591,014 617,232 649,880 632,532
Slide 24: Consolidated Statement of Financial Position
Summary Appendix mBank Historical view Profit & Loss Balance Sheet Analyzer Additional Information: Selected Financial Data Business Lines Subsidiaries Consolidated Statement of Financial Position Assets (PLN thou.) Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Cash and balances with Central Bank 2 089 199 1 418 01
Slide 25: mBank Group's Ratios
Summary Appendix Historical view Profit & Loss Balance Sheet Additional Information: Selected Financial Data Business Lines Subsidiaries mBank Group’s Ratios Financial Ratios Q1/14 Q2/14 Q3/14 Q4/14 Q1/15 Net Interest Margin (quarterly) 2.30% 2.30% 2.32% 2.27% 2.06% Net Interest Margin YtD 2.30% 2.3
Slide 26: mBank Group's historical performance (1/3)
Summary Appendix mBank Historical view Profit & Loss Balance Sheet Analyzer mBank Group’s historical performance (1/3) Business Lines Subsidiaries Net Interest Income & NIM Net Fee and Commission Income (PLN M) (PLN M) CAGR 2.2% 2.5% 2.4% 2.2% 2.3% 2.3% 2.1% +5% CAGR +8% 840 835 902 746 787 -20% 2,2
Slide 27: mBank Group's historical performance (2/3)
Summary Appendix mBank Historical view Profit & Loss Balance Sheet Analyzer mBank Group’s historical performance (2/3) Business Lines Subsidiaries Operating Costs Pre-provision Income & C/I ratio (PLN M) (PLN M) CAGR +2% 51.8% 47.7% 46.5% 45.7% 44.9% 45.0% 40.5% CAGR +10% Increase due to higher BFG
Slide 28: mBank Group's historical performance (3/3)
Summary Appendix mBank Historical view Profit & Loss Balance Sheet Analyzer mBank Group’s historical performance (3/3) Business Lines Subsidiaries Total Assets Equity & CAR (PLN B) (PLN M) +15% 15.90% 14.96% 18.73% 19.38% 14.66% 16.26% 16.28% CAGR +7% +18% CAGR +12% 118.0 123.3 98.9 102.1 104.3 107.
Slide 29: Net Interest Income & Margin
Summary Appendix mBank Historical view Profit & Loss Balance Sheet Analyzer Additional Information: Selected Financial Data Business Lines Subsidiaries Net Interest Income & Margin Interest Income Structure Interest Expense Structure Change in the presentation of premiums (PLN M) (PLN M) on bonds: s
Slide 30: Fee and Commission Income
Summary Appendix mBank Historical view Profit & Loss Balance Sheet Analyzer Additional Information: Selected Financial Data Business Lines Subsidiaries Fee and Commission Income Fee and Commission Income Structure (PLN M) QoQ YoY 369.2 353.8 43.4 339.3 337.4 +20.2% -9.4% 46.7 314.5 37.2 33.1 53.1 27
Slide 31: Trading and Other Income
Summary Appendix mBank Historical view Profit & Loss Balance Sheet Analyzer Additional Information: Selected Financial Data Business Lines Subsidiaries Trading and Other Income Net Trading Income Structure Gains less Losses from Investment Securities (PLN M) (PLN M) +11% 34.5 +46% 110.2 102.6 96.3 9
Slide 32: Balance Sheet Analysis: Assets & Liabilities
Summary Appendix mBank Historical view Profit & Loss Balance Sheet Analyzer Additional Information: Selected Financial Data Business Lines Subsidiaries Balance Sheet Analysis: Assets & Liabilities Structure of Assets Structure of Liabilities (PLN B) (PLN B) 123.3 123.3 117.3 118.0 5.0 4% 117.3 118.0
Slide 33: Balance Sheet Analysis: Currency Structure
Summary Appendix mBank Historical view Profit & Loss Balance Sheet Analyzer Additional Information: Selected Financial Data Business Lines Subsidiaries Balance Sheet Analysis: Currency Structure Currency Structure of Loans to Customers (net) Currency Structure of Amounts due to Banks and Customers1
Slide 34: Balance Sheet Analysis: Structure of Loans and Deposits
Summary Appendix mBank Historical view Profit & Loss Balance Sheet Analyzer Additional Information: Selected Financial Data Business Lines Subsidiaries Balance Sheet Analysis: Structure of Loans and Deposits Structure of mBank Group’s Gross Loans Structure of mBank Group’s Deposits as of 31.03.2015
Slide 35: Balance Sheet Analysis: Loan Portfolio Structure
Summary Appendix Historical view Profit & Loss Balance Sheet Additional Information: Selected Financial Data Business Lines Subsidiaries Balance Sheet Analysis: Loan Portfolio Structure mBank Group’s Sector Exposure by Industry as of 31.03.2015 Households Real estate management 15.8% Wholesale trade
Slide 36: Detailed Development of Capital Ratios
Summary Appendix Historical view Profit & Loss Balance Sheet Additional Information: Selected Financial Data Business Lines Subsidiaries Balance Sheet Analysis: Detailed Development of Capital Ratios mBank Group’s Common Equity Tier 1 (CET 1) Ratio 13.20% -0.33 +0.35 -0.13 13.05% -0.38 -0.04 +1.04 1
Slide 37: Issuance Activity on the Covered Bonds Market
Summary Appendix Historical view Profit & Loss Balance Sheet Issuance Activity on the Covered Bonds Market Business Lines Subsidiaries Residential mortgage loans to rise in cover pool Covered Bonds Issuance Summary of Mortgage Covered Bonds issued in 2014 and 2015 (PLN M) Amount Currency Issue date
Slide 38: Detailed Results of the Business Lines: Retail Banking
Summary Appendix Historical view Profit & Loss Balance Sheet Business Lines Subsidiaries Detailed Results of the Business Lines in Q1/15 Retail Banking Investor Presentation – Q1 2015 |38
Slide 39: Retail Banking: Summary of Q1/15 Financial Results
Summary Appendix Historical view Profit & Loss Balance Sheet Retail Banking Business Lines Subsidiaries Summary of Q1/15: Financial Results Profit before Tax of the Segment Number of Retail Outlets (PLN M, by quarter) +44% 258 258 256 256 258 +118% 35 35 35 35 35 24 24 23 23 23 413.2 67 67 67 67 70
Slide 40: Retail Banking: Loans and Deposits
Summary Appendix Historical view Profit & Loss Balance Sheet Retail Banking Business Lines Subsidiaries Summary of Q1/15: Loans and Deposits Gross Loans to Retail Banking Clients1 Deposits from Retail Banking Clients (PLN M) (PLN M) +12.4% +14.1% +5.4% +1.0% 43,788 39,285 39,693 41,560 143 39,664 40
Slide 41: Mortgage and Non-mortgage Loans: Portfolio Structure
Summary Appendix Historical view Profit & Loss Balance Sheet Retail Banking Business Lines Subsidiaries Mortgage and Non-mortgage Loans: Portfolio Structure and Key Parameters mBank’s Mortgage Loan Portfolio Currency Structure of Retail Banking Mortgage Loan Portfolio (Loans to individuals of Retail
Slide 42: mBank in the Czech Republic and Slovakia
Summary Appendix Historical view Profit & Loss Balance Sheet Retail Banking Business Lines Subsidiaries mBank in the Czech Republic and Slovakia Gross Loans (PLN M) and Share in Total mBank’s retail volume Deposits (PLN M) and Share in Total mBank’s retail volume +33% +14% +3% +3% 6.9% -1% 14.0% 2,9
Slide 43: mBank in the Czech Republic and Slovakia
Summary Appendix Historical view Profit & Loss Balance Sheet Retail Banking Business Lines Subsidiaries mBank in the Czech Republic and Slovakia Mortgage Loans Non-mortgage Loans Customer deposits (CZK M) (CZK M) (CZK M) +28% +26% +52% +6% +4% Czech +12% Republic 12,416 13,172 24,649 25,546 2,375 10
Slide 44: Corporates & Financial Markets
Summary Appendix Historical view Profit & Loss Balance Sheet Business Lines Subsidiaries Detailed Results of the Business Lines in Q1/15 Corporates & Financial Markets Investor Presentation – Q1 2015 |44
Slide 45: Corporates and Financial Markets: Financial Results
Summary Appendix Historical view Profit & Loss Balance Sheet Corporates and Financial Markets Business Lines Subsidiaries Summary of Q1/15: Financial Results Profit before Tax of the Segment Corporate Branch Network (PLN M, by quarter) -0.7% 47 47 47 47 47 -25% 18 18 18 18 18 207.3 157.3 166.5 50.7
Slide 46: Corporates and Financial Markets: Loans and Deposits
Summary Appendix Historical view Profit & Loss Balance Sheet Corporates and Financial Markets Business Lines Subsidiaries Summary of Q1/15: Loans and Deposits Gross Loans to Corporate Entities Deposits from Corporate Customers (PLN M) (PLN M) +10.8% +9.8% +7.6% -4.4% 35,340 31,576 32,237 1,947 30,81
Slide 47: Corporates and Financial Markets: Market Shares
Summary Appendix Historical view Profit & Loss Balance Sheet Corporates and Financial Markets Business Lines Subsidiaries Market Shares mBank’s Market Shares in Investment Banking Services1 mBank in the Market for Non-Treasury Debt2 as of 31.03.2015 (PLN M) 53,711 13.4% 17.1% 29,878 18,128 10,774 7,
Slide 48: Subsidiaries
Summary Appendix Historical view Profit & Loss Balance Sheet Business Lines Subsidiaries Detailed Results of the mBank Group’s companies in Q1/15 Subsidiaries Investor Presentation – Q1 2015 |48
Slide 49: Financial Results of Major Companies
Summary Appendix Historical view Profit & Loss Balance Sheet mBank Group’s Subsidiaries Business Lines Subsidiaries Summary of Q1/15: Financial Results of Major Companies Profit before Tax of Consolidated Subsidiaries (PLN M) Q1/14 Q1/15 +20% 15.6 +10% 13.0 -39% 11.6 10.9 +44% 9.9 8.7 -61% +3% +24%
Slide 50: mBank Hipoteczny (mBH)
Summary Appendix Historical view Profit & Loss Balance Sheet mBank Group’s Subsidiaries Business Lines Subsidiaries mBank Hipoteczny (mBH) Net loans and advances to customers Profit before Tax (PLN M) (PLN M) established in 1999 +39% +10% +6% specialised mortgage bank and 10.9 the largest issuer of
Slide 51: Leasing and Factoring
Summary Appendix Historical view Profit & Loss Balance Sheet mBank Group’s Subsidiaries Business Lines Subsidiaries Leasing and Factoring Leasing contracts Market share & position – Q1 2015 Profit before Tax (PLN M) (PLN M) +13% +20% 6.6% established 696.6 15.6 in 1991 616.4 13.0 Rank provides finan
Slide 52: Dom Maklerski mBanku (mDM)
Summary Appendix Historical view Profit & Loss Balance Sheet mBank Group’s Subsidiaries Business Lines Subsidiaries Dom Maklerski mBanku (mDM) Market Shares in Q1/15, by volume Profit before Tax (PLN M) established in 1991 incl. block Session -61% transactions transactions providing a full range of
Slide 53: mBank Analyzer
mBank Analyzer mBank Analyzer Further enhancing our reporting standard Analyse, customise, export and print selected data on mBank Group, covering all periods since Q1/06 in quarterly and annual series Includes FX Comprehensive Summary of Data covering Details on each structure and report on key fin
Slide 54: Contact details
Contact details mBank’s Investor Relations at your service: E-mail address: investor.relations@mbank.pl Wojciech Chmielewski Direct dial: +48 22 829 14 34 E-mail: wojciech.chmielewski@mbank.pl Head of Investor Relations and Group Strategy Joanna Filipkowska Direct dial: +48 22 829 04 53 E-mail: joan