Procredit Holding Ag · XETR:PCZ
Procredit — ProCredit Holding AG & Co. KGaA — FY2021 Earnings Presentation
47 slides from Procredit's earnings presentation, Mar 24, 2022
Slide 1: Q4 2021 / FY 2021 results
Dr Gabriel Schor, Member of the Management Board Christian Dagrosa, Manager Q4 2021 / FY 2021 results Frankfurt am Main, March 2022
Slide 2: Update on ProCredit Bank Ukraine – key facts
Update on ProCredit Bank Ukraine – key facts Current status of operations (24.03.2022) Overview of ProCredit Bank Ukraine ► Safety of staff is our primary focus: strong support across the group for our Ukrainian colleagues, e.g. accommodation, essentials, medical supplies. Some 70% of staff working
Slide 3: Agenda
Agenda A Highlights B Group results C Asset quality and capital D Update on ProCredit Bank Ukraine Q&A Appendix ProCredit Group | Q4/ FY 2021 results | Frankfurt am Main, 24 March 2022 2
Slide 4: Highlights FY 2021
Highlights FY 2021 FY 2021 financial result overachieving increased guidance; RoE on level of medium-term guidance ► Results guidance metrics overachieved on the back of already increased results guidance within 2021 ► Net profit of EUR 79.6m (+92% vs. 2020 of EUR 41.4m), corresponding to a RoE of 9
Slide 5: FY 2021 results versus increased guidance
FY 2021 results versus increased guidance Guidance Actual FY 2021(1) FY 2021 ► Growth of the loan portfolio c. 10% 12.8% ✓ 8.0 – 9.5% ► Return on equity (RoE) upper-end corridor result likely 9.7% ✓ ► Cost-income ratio (CIR) c. 65% likely to not exceed 65% 64.2% ✓ ► CET1 ratio and leverage ratio > 1
Slide 6: Continued strong growth in customer loans
Continued strong growth in customer loans Loan portfolio growth ► Strong growth in customer loans in FY 2021 (EUR 670m/12.8%) 12.8% and in Q4-21 (EUR 121m/2.1%) 19% ▪ Growth in all loan categories, with stronger demand for working capital loans in 2021 with maturities < 3 years 45% ▪ All ProCredit b
Slide 7: Good deposit development through digital banking channels
Good deposit development through digital banking channels ► YOY increase of EUR 643m (+13.1%) Deposits by product ▪ Achieved mostly through growth in business clients, also private client deposits increasing visibly (+ EUR 216m) 5,542 4,899 ▪ Increased share of sight deposits and FlexSave 4,333 1,58
Slide 8: Sustainability commitment firmly integrated in the business model
Sustainability commitment firmly integrated in the business model – Impact report 2021 published Impact through Environmental Comprehensive staff business responsibility development ► Supporting SMEs through the cycle ► Green loan portfolio > €1.1bn, avg. ► High diversity, gender parity growth 18% p
Slide 9: Promoting e-mobility across our countries of operation
Promoting e-mobility across our countries of operation ► Installation of 207 public electric vehicle chargers in all ProCredit countries of operations ► ProCredit app developed to easily locate the electric chargers that are free of charge ► Cooperation with car dealers, price incentive for e-car fi
Slide 10: Key recent developments and outlook for our countries of operations
Key recent developments and outlook for our countries of operations Overview of regional presence in SEE/EE COVID-19 pandemic and governmental response ► Steady progress of vaccination roll-out helps curb the impact on the population of increasing infection rates ► Restrictive measures amid higher i
Slide 11: Outlook for ProCredit Group
Outlook for ProCredit Group Outlook 2022: Limited ability to forecast key metrics resulting from uncertainties of war in Ukraine c. 10% in many group banks, ► Growth of the loan portfolio overall below FY 2021 ► Return on equity (RoE) significantly below FY 2021 ► Cost-income ratio (CIR) higher than
Slide 12: Agenda
Agenda A Highlights B Group results C Asset quality and capital D Update on ProCredit Bank Ukraine Q&A Appendix ProCredit Group | Q4/ FY 2021 results | Frankfurt am Main, 24 March 2022 11
Slide 13: FY 2021 results at a glance
FY 2021 results at a glance In EUR m Q4-2020 Q4-2021 FY-2020 FY-2021 y-o-y Net interest income 50.8 60.6 201.6 222.0 20.5 Net fee and commission income 12.7 13.8 47.4 50.9 3.5 Other operating income (net) 0.5 2.9 3.2 9.0 5.8 Operating income 64.0 77.4 252.1 281.9 29.8 Income Personnel expenses 22.4
Slide 14: Net interest income
Net interest income ► Strong Q4-21 NII of EUR 60.6m (increased by EUR 2.4m or 3.0% 3.0% 4.1% vs. Q3-21 and EUR 9.8m or 19.3% vs. Q4-20) 2.8% 2.9% 2.7% 60.6 58.2 53.9 ► Net interest income with positive dynamic in 2021 as result of 50.8 49.3 ▪ Volume effects driven by strong portfolio growth of 12.8%
Slide 15: Provisioning expenses
Provisioning expenses ► Q4-21 loan loss provisioning expenses at EUR 3.2m, corresponding to 22bps cost of risk ▪ Majority of pandemic-driven provisions not released during annual parameter update 57 bps ► Full-year loan loss provisioning expenses of EUR 6.5m significantly below previous year; FY 202
Slide 16: Net fee and commission income
Net fee and commission income ► Q4-21 net fee and commission income EUR 0.8m or 6.2% 13.8 above Q3-21 and well above previous quarters 12.7 13.0 12.0 12.1 • Steady increases in number and volume of transactions, yielding higher income from money transfer and credit/debit card fees • Increase in fee
Slide 17: Operating expenses
Operating expenses 72.3% ► Q4-21 cost-income ratio of 68.7% with seasonal increase vs. Q3-21, 68.7% 64.8% 64.0% but significantly improved YOY (-3.6pp) 59.0% 26.0 ▪ Q4-21 cost base includes effects from stock participation of c. 80 key employees in our banks of c. EUR 2m and write-down of goodwill 2
Slide 18: Contribution of regional segments to group net income
Contribution of regional segments to group net income Group functions, e.g. risk management, reporting, capital management, IT, liquidity management, training and development Includes ProCredit Holding, Quipu, ProCredit Academy Fürth, ProCredit Bank Germany (EUR 51m customer loan portfolio; EUR 257m
Slide 19: Key figures per ProCredit bank (as per FY 2021)
Key figures per ProCredit bank (as per FY 2021) North Bosnia & Country Bulgaria Serbia Kosovo Romania Macedonia Herzegovina Customer loan portfolio (EUR m) 1,221 1,002 590 461 358 267 Change in customer loan portfolio (%) 11.2% 6.0% 10.4% 8.7% 4.0% 12.3% Credit impaired loans (Stage 3) 1.7% 2.0% 2.3
Slide 20: Agenda
Agenda A Highlights B Group results C Asset quality and capital D Update on ProCredit Bank Ukraine Q&A Appendix ProCredit Group | Q4/ FY 2021 results | Frankfurt am Main, 24 March 2022 19
Slide 21: Structure of the loan portfolio
Structure of the loan portfolio Loan portfolio by geographical segments Loan portfolio by sector Investment and Germany other loans Ecuador Housing 1% 1% 7% 7% Moldova Bulgaria 3% Wholesale and 21% retail trade Georgia 26% 6% Other economic activities 22% Ukraine 13% Serbia 17% Bosnia Transportation
Slide 22: Loan portfolio quality
Loan portfolio quality IFRS 9 ► Continued positive development of risk indicators in Q4-21 ► Share of Stage 3 loans at 2.3% even below the good level of 0.3% 0.1% 0.1% Net write-offs Q4-20, driving good development of cost of risk Coverage ► Share of Stage 2 loans at 3.6% well below levels of Q4-20
Slide 23: Regulatory capital and risk-weighted assets
Regulatory capital and risk-weighted assets in EUR m Dec-20 Dec-21 ► Capital ratios well above regulatory capital requirements (8.2% CET1 capital, 10.1% T1, 12.6% total capital) CET1 capital 706 792 Additional Tier 1 capital 0 0 ► CET1 capital includes profits as of September 2021 YTD Tier 1 capital
Slide 24: Development of CET1 capital ratio (fully loaded)
Development of CET1 capital ratio (fully loaded) Q4-21 attributable profits 9M-21 attributable profits of EUR 17.6m Positive development in group’s of EUR 62.0m net of 1/3 dividend accrual Loan portfolio growth of EUR translation reserve due to net of 1/3 dividend accrual 670m (12.8%) currency appre
Slide 25: Agenda
Agenda A Highlights B Group results C Asset quality and capital D Update on ProCredit Bank Ukraine Q&A Appendix ProCredit Group | Q4/ FY 2021 results | Frankfurt am Main, 24 March 2022 24
Slide 26: ProCredit Bank Ukraine – development since invasion into Ukraine
ProCredit Bank Ukraine – development since invasion into Ukraine ► Key infrastructure and security measures: ▪ Direct banking concept means: no physical offices required to conduct the main banking operations ▪ Bank’s operationality steady and secured: data bases backed up in Germany; card transacti
Slide 27: ProCredit Bank Ukraine – key group messages and facts
ProCredit Bank Ukraine – key group messages and facts Key group messages on the current crisis Overview of ProCredit Bank Ukraine ► ProCredit group comprises 12 banks with the large majority Loan portfolio RWA Equity of assets not directly impacted by the war in Ukraine EUR 757m EUR 818m EUR 130m ►
Slide 28: Agenda
Agenda A Highlights B Group results C Asset quality and capital D Update on ProCredit Bank Ukraine Q&A Appendix ProCredit Group | Q4/ FY 2021 results | Frankfurt am Main, 24 March 2022 27
Slide 29: Q&A
Q&A Photovoltaic project financed by ProCredit Bulgaria 28
Slide 30: Agenda
Agenda A Highlights B Group results C Asset quality and capital D Update on ProCredit Bank Ukraine Q&A Appendix ProCredit Group | Q4/ FY 2021 results | Frankfurt am Main, 24 March 2022 29
Slide 31: ProCredit – A unique approach to banking
ProCredit – A unique approach to banking Summary Key figures FY 2021 and FY 2020 ► A profitable, development-oriented commercial group of banks Total assets Customer loan portfolio Deposit/loan with a focus on South Eastern and Eastern Europe EUR 8,216m EUR 5,924m 94% ► Headquartered in Frankfurt an
Slide 32: Overview of quarterly financial development
Overview of quarterly financial development In EUR m Q4-2020 Q1-2021 Q2-2021 Q3-2021 Q4-2021 Net interest income 50.8 49.3 53.9 58.2 60.6 Net fee and commission income 12.7 12.0 12.1 13.0 13.8 Other operating income (net) 0.5 1.6 0.6 3.9 2.9 Operating income 64.0 62.8 66.6 75.1 77.4 Income Personnel
Slide 33: Segment South Eastern Europe
Segment South Eastern Europe Regional loan portfolio breakdown Key financial data Bosnia In EUR m FY 2020 FY 2021 Albania 6% 6% Net interest income 117.3 130.1 Bulgaria Romania 30% Net fee and commission income 31.4 31.8 9% Other operating income (net) 1.2 4.6 North Operating income 149.8 166.4 Mace
Slide 34: Segment Eastern Europe
Segment Eastern Europe Regional loan portfolio breakdown Key financial data Moldova In EUR m FY 2020 FY 2021 13% Net interest income 62.8 71.3 Net fee and commission income 8.3 7.8 Other operating income (net) 5.5 4.7 Operating income 76.6 83.8 Georgia Ukraine Personnel expenses 12.3 13.4 30% 57% Ad
Slide 35: Segment South America
Segment South America Regional loan portfolio breakdown Key financial data In EUR m FY 2020 FY 2021 Net interest income 18.6 20.2 Net fee and commission income -0.3 -0.4 Other operating income (net) -0.8 -1.0 Ecuador 100% Operating income 17.5 18.8 Personnel expenses 5.8 5.9 Admininistrative expense
Slide 36: Development of green loan portfolio
Development of green loan portfolio Green loan portfolio growth 12.6% 15.4% 16.6% 18.7% 19.0% ► Green loan portfolio amounting to EUR 1.1bn, representing 1,128 19.0% of total loan portfolio 985 36 21 795 ▪ FY 2021 growth of EUR 143m or 14.5% 678 17 15 489 ► Includes financing of investments in: 1,09
Slide 37: Structure of the loan portfolio by exposure and currency
Structure of the loan portfolio by exposure and currency Loan portfolio by exposure Loan portfolio by currency 7% 33% 19% 36% 52% 14% 12% 27% < 50k 50-250k 250-500k 500k-1.5m >1.5m EUR USD Other currencies ProCredit Group | Q4/ FY 2021 results | Frankfurt am Main, 24 March 2022 36
Slide 38: Structure of collateral
Structure of collateral Collateral by type ► Majority of collateral consists of mortgages 24% ► Growing share of financial guarantees mainly as a result of InnovFin and other guarantee programmes provided by the European Investment Fund ► Clear, strict requirements for types of acceptable collateral
Slide 39: Funding and rating
Funding and rating Funding sources overview ► Highly diversified funding structure and counterparties 1% 5% 1% ► Customer deposits main funding source, accounting for 75%, 18% supplemented by long-term funding from IFIs and institutional Customer deposits investors Liabilities to IFIs Liabilities to
Slide 40: Liquidity update
Liquidity update Liquidity coverage ratio ► LCR of 158% and NSFR of 142% (Dec-21) remain comfortably above the respective regulatory minimum 198% 153% 158% ► Stable level of HLAs, with increase in Q4-21 (EUR 0.2 bn) 100% 100% 100% primarily driven by strong deposit portfolio growth Dec-19 Dec-20 Dec
Slide 41: Asset reconciliation
Asset reconciliation ProCredit Group | Q4/ FY 2021 results | Frankfurt am Main, 24 March 2022 40
Slide 42: Liabilities and equity reconciliation
Liabilities and equity reconciliation ProCredit Group | Q4/ FY 2021 results | Frankfurt am Main, 24 March 2022 41
Slide 43: Balance sheet
Balance sheet in EUR m Dec-20 Dec-21 Assets Cash and central bank balances 1,405 1,546 Loans and advances to banks 237 253 Investment securities 336 410 Loans and advances to customers 5,254 5,924 Loss allowance for loans to customers -123 -131 Derivative financial assets 1 1 Property, plant and equ
Slide 44: Income statement by segment
Income statement by segment 01.01.- 31.12.2021 South Eastern Germany Eastern Europe South America Consolidation Group (in EUR m) Europe Interest and similar income 23 114 159 35 -21 310 of which inter-segment 20 0 0 0 0 0 Interest and similar expenses 22 42 29 15 -21 88 of which inter-segment 1 6 8
Slide 45: Explanatory note on performance indicators and ratios
Explanatory note on performance indicators and ratios The ProCredit group uses an integrated system of indicators to monitor The group also considers the following additional indicators: and manage the implementation and further development of the group’s business and risk strategy: ▪ The ratio of c
Slide 46: Contact Investor Relations
Contact Investor Relations Financial calendar (continuously updated on IR Website) Date Place Event information 29.-30.03.2022 virtual Jefferies, Pan- European Mid-Cap Conference 12.05.2022 Quarterly Financial Report as of 31 March 2022 23.-25.05.2022 Frankfurt/Main Equity Forum, Spring Conference 2
Slide 47: Disclaimer
Disclaimer The material in this presentation and further supporting documents have been This presentation and further supporting documents may contain forward- prepared by ProCredit Holding AG & Co. KGaA, Frankfurt am Main, Federal looking statements including statements regarding our intent, belief
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