Credito Emiliano S.p.a. · MIL:CE
Credito Emiliano — FY2017 Earnings Presentation
25 slides from Credito Emiliano's earnings presentation, 2018
Slide 1: Group’s Results 2017
Group’s Results 2017
Slide 2: 2017 Highlights
2017 Highlights Group’s growth strategy was confirmed by the increase of all aggregates. In detail: Wealth Management’s strong expansion continued, with AUM and Insurance Reserves exceeding €34 billion at the end of 2017, as a result of the €3 billion increase (~ +10% YoY) Loans to Customers were up
Slide 3: Income Statement
Income Statement €, million 4Q16 3Q17 4Q17 % 4Q17 2016 2017 % 2017 • Operating Income grew vs 3Q17 vs 2016 by 3.7% YoY («core» revenues +4.4%), whereas Operating Income 306.3 264.8 297.4 12.3% 1,106.7 1,148.0 3.7% Operating Costs growth Op. Income net* of strongly decreased Income from Fin. (+0.9% Y
Slide 4: Main 4Q17 non-recurrent events
Main 4Q17 non-recurrent events 4Q17 Reclassified Income Statement ++10.9 10,9 Tltro II Interest Income (non-recurrent component) Interest Income ++2.2 2,2 Extraordinary dividend from Cedacri stake ++7.9 7,9 Performance Fees Non Interest Income --1.7 3,5 Banking fees relative to liquidity position on
Slide 5: Operating Income
Operating Income Average quarterly Core Operating Income (net of Income from Financial Activities and Performance Fees) €, million 280 268.3 270 +27.9% 257.0 260 248.8 247.7 250 240 234.0 230 224.4 224.4 220.7 220 209.9 210 200 Avg Avg Avg Avg Avg Avg Avg Avg Avg 2009 2010 2011 2012 2013 2014 2015 2
Slide 6: Interest Margin (1/3)
Interest Margin (1/3) Quarterly Interest Margin €, million 486 +7.1% 133 132 131 130 €13.1 million: non-recurrent Interest Margin showed an overall increase 129 128 133 127 126 125 124 456 benefit from Tltro II + of +7.1% YoY vs 2016, thanks to volumes’ 123 122 121 extraordinary Cedacri dividends 12
Slide 7: Interest Margin (2/3)
Interest Margin (2/3) Evolution of Average Loans Rate Evolution of Average Deposit Rate (Credem SpA management accounting) (Credem SpA management accounting) % % 3.04 1.07 3.10 2.85 1.00 0.95 0.95 2.80 2.77 2.72 0.90 -0.75 2.60 -0.72 -0.74 -0.80 2.29 -0.78 -0.71 2.13 2.06 2.10 1.97 1.94 -0.76 0.60 -
Slide 8: Interest Margin (3/3)
Interest Margin (3/3) Variazione degli impieghi Securities’ Portfolioalla clientela Breakdown (Credem SpA management accounting) Securities’ Portfolio remained 100% substantially stable in the quarter, showing a modest growth (+€225 million) 90% compared to the end of 3Q17, with the 80% 39% 36% 34%
Slide 9: Non Interest Income
Non Interest Income Non Interest Income: Quarterly Evolution €, million 188.8 210 11.6 178.3 169.5 170.5 164.6 Performance Fees 146.8 15.3 9.2 160 145.8 33.4 146.4 22.1 3.3 38.8 6.4 7.7 3.0 Trading 49.4 44.8 45.0 43.6 44.2 Other 110 46.6 46.3 46.0 15.0 12.2 12.0 16.0 Banking Fees 12.6 12.2 14.6 10.4
Slide 10: Operating Costs
Operating Costs Operating Costs: Quarterly Evolution Employees / Networks €, million +0.9% Employees 6,068 6,140 5,899 200 179.3 181.0 171.6 181.3 185.8 184.1 169.3 180.3 5,740 5,763 5,544 5,519 5,604 5,609 150 57 60 51 59 61 51 56 51 2009 2010 2011 2012 2013 2014 2015 2016 2017 100 123 121 115 131
Slide 11: Loans to Customers
Loans to Customers Loans to Customers (net of Repos with Institutional and Loans to Group’s SPVs) €, million 23,687 23,474 24,720 24,000 22,649 21,508 4,156 4,785 19,721 19,949 19,938 4,626 20,000 18,770 3,755 17,536 3,339 3,324 3,370 3,056 3,323 6,775 16,000 2,577 6,392 6,715 6,235 6,710 6,282 6,24
Slide 12: Loans to Customers: comparison with the Industry
Loans to Customers: comparison with the Industry Loans to Customers growth Market shares on retail, corporate customers (Retail and Public Sector) and small business (net of financial institutions) % 2009: base 100 (Credem SpA management reporting) 150 Industry 1.73% 140 Credem 1.63%1.66% +41% 1.58%
Slide 13: Deposits, Bonds and AUM
Deposits, Bonds and AUM €, million 2013 2014 2015 2016 2017 • The quarter showed once again its positive Sight / Saving seasonality, with a considerable Direct 13,625 15,335 16,979 19,331 21,451 Deposits’ expansion (more than €2 billion Deposits growth in sight deposits) and AUM CD and Other 260 333
Slide 14: AUM and Insurance Reserves
AUM and Insurance Reserves AUM and Insurance Reserves Evolution (€, billion) Insurance Reserv es 34.0 AUM +63% AUM and Insurance Reserves kept on 31.0 growing, with an overall increase of almost 28.1 6.8 €3.1 billion year to date (out of which ~ €600 24.6 6.3 5.5 million in 4Q17). Since the beginnin
Slide 15: Group’s customer funding: net inflows breakdown
Group’s customer funding: net inflows breakdown Yearly Net Inflows evolution 4Q16 vs 4Q17 €, million 1,563 1,661 1,700 AUC 3900 3,476 4,508 Direct Deposits 4,083 4,600 1,158 1,500 3,955 2,983 1,122 3300 AUM 3,534 2,826 1,000 1,300 2700 Total Net Inflows 2,608 3,600 2,252 1,100 2100 1,811 632 664 900
Slide 16: Issued Bonds and future maturities
1.000 Issued Bonds and future maturities 800 Issued Bonds Bonds Maturities (Credem SpA management account) (Credem SpA management account) €, million 600 Retail Bonds 2.000 €, million 400 365 Institutional 1.500 Retail 1.473 200 1.407 308 1.000 231 1.500 0 31 2018 2019 2020 2021 500 938 523 600 38 3
Slide 17: Credit Quality (1/2)
Credit Quality (1/2) Gross Non Performing Loans 1H17 900 861.1 858.0 820.0 9M17 Bad Loans 600 501.0 498.8 2017 portfolio 465.0 disposal 300 39.0 37.8 41.1 0 Gross Bad Loans Gross UTP Loans Gross Past Due Loans % on Loans (Credem) 3.6 3.6 3.2 2.1 2.1 1.8 0.2 0.2 0.2 % on Loans (Industry)** 9.6 8.7 5.
Slide 18: Credit Quality (2/2)
Credit Quality (2/2) Quarterly Average Gross NPLs Flows 2017 Quarterly Flows (net of NPLs portfolio disposals*) (net of NPLs portfolio disposals) 70 €, million €, million 70 2017 Quarterly Average: - 6 60 2.0 50 46 42 -113% -3.0 -1.0 -1.2 40 25 27 26 30 22 -8.0 -6.5 20 15 10 -13.0 -10 -6 -18.0 -16.1
Slide 19: NPLs’ Coverage
NPLs’ Coverage Net Non Performing Loans €, million 2013 2014 2015 2016 9M17 2017 Also Net NPLs flows decreased for the Net Bad Loans 334.4 356.8 345.7 335.3 319.3 fifth quarter in a row (with a 2017 reduction of almost -€80 million, out of which ~€55 Net Unlikely to 362.8 376.2 425.3 416.9 374.9 mil
Slide 20: NPLs: comprehensive coverage
NPLs: comprehensive coverage Coverage Also considering the amount of the NPLs Gross Net Coverage Shortfall* including (€, million) (€, million) (€, million) shortfall*, which is included in all Shortfall* the most recent «coverage Bad Loans 820.0 319.3 61.1% 147.4 79.0% backstop» draft proposals and
Slide 21: Cost of risk
Cost of risk Cost of risk (bps) 70 70 59 60 60 55 52 51 52 50 39 37 33 33 40 28 32 34 47 45 30 41 39 39 41 22 25 22 37 20 31 28 28 30 27 19 19 21 19 21 10 2013 1Q14 1H14 9M14 2014 1Q15 1H15 9M15 2015 1Q16 1H16 9M16 2016 1Q17 1H17 9M17 2017 Cost of risk Cost of risk (net of non recurrent events) Cost
Slide 22: Assets & Liabilities
Assets & Liabilities Assets (€,million) Loans to Customers were 23,474 24,720 positively affected by the usual 24,000 9M17 2017 4Q seasonality and reached a new peak at €24.7 billion 18,000 (+€1.25 billion vs 9M17) 12,000 Direct Deposits’ strong 6,589 6,531 6,810 6,551 expansion caused a liquidity 6
Slide 23: Liquidity Ratios
Liquidity Ratios NSFR 150% Both NSFR and LCR ratios showed 130% 124% 125% 125% 123% values well above the future target 116% thresholds, with NSFR at 123% and LCR 110% at 166% 90% ECB unencumbered eligible securities net of haircut at the end of December 2017 70% were €5 billion (12% of Total Assets
Slide 24: Consolidated Capital Ratios
Consolidated Capital Ratios Capital and Capital Ratios Phased-in CET1 Ratio (Credemholding’s prudential perimeter) % €, million Basel 3 Phased-in Fully phased 15.0 14.2 13.7 13.2 13.3 2016 2017 2016 9M17 2017 13.0 CET 1 1,765 1,825 1,590 1,664 1,768 Tier Total 1,939 2,053 1,818 1,951 2,061 11.0 Capi
Slide 25: Disclaimer and Contacts
Disclaimer and Contacts The manager responsible for preparing the company’s financial reports Mr. Paolo Tommasini of Credito Emiliano S.p.A., declares, pursuant to paragraph 2 of Article 154 bis of the Consolidated Law on Finance, that the accounting information contained in this presentation corres