Otp Bank Nyrt · BET:OTP

Otp Bank Nyrt — UBS 2nd Annual LATAM – EMEA Investor Conference (November 2005)

39 slides from Otp Bank Nyrt's conference presentation, Nov 21, 2005

  1. Slide 1: OTP Bank - 3Q 2005 Results

    UBS 2nd Annual LATAM – EMEA Investor Conference OTP BANK - 3Q 2005 RESULTS Presented by: Dr. Zoltán Spéder, CFO November, 2005

  2. Slide 2: Agenda

    ƒ Key facts on OTP Bank ƒ Macroeconomic environment and financial intermediary ƒ Financial performance (consolidated, IFRS) ƒ OTP Bank in the Region

  3. Slide 3: OTP Bank key facts

    21/11/2005 OTP Bank… … is the largest financial services provider in Hungary Its market share* is 24.3% by total banking assets, 26.9% by total deposits and 21.4% by total loans. OTP Group generated 51.8% of total banking profits in Hungary in 2Q 2005. … has a strong capital base, high profitability

  4. Slide 4: Same group structure in every country

    21/11/2005 OTP Bank has or started to build the same group-structure in every country Parent company OTP Bank Ltd. OTP Mortgage OTP Building OTP Banka OTP Bank OTP banka Banks Merkantil Bank DSK Bank (BG) Bank Society Slovensko (SK) Romania (RO) Hrvatska (HR) Other financial OTP Garancia OTP Fund DS

  5. Slide 5: Outstanding profitability amongst peer banks

    21/11/2005 OTP Bank has outstanding profitability amongst peer banks PROFITABILITY AND VALUATION MARKET CAP (EUR bn) 6 Unicredito 32.8 P/BV 5 OTP Cons. (3Q05) KBC 25.9 OTP Bank (3Q05) 4 Commerzbank 13.5 Pekao* Erste Bank 10.9 3 Raiffeisen Int.* Erste Bank* OTP Bank 9.2 Unicredito* Komercni Bank* 2 K

  6. Slide 6: Share price growth reflects investors' confidence

    21/11/2005 The share price growth reflects investors’ confidence 400% OTP SHARE’S PERFORMANCE, in 1-9M, 2005 350% Min. price (closing) HUF 5,590 (06/01/05) Max. price (closing) HUF 8,630 (27/09/05) 300% Market capitalization HUF 2,286 bn (on 30/09/2005) EUR 9.2 bn 250% P/E (consolidated, 3Q2005) 12.

  7. Slide 7: Agenda

    ƒ Key facts on OTP Bank ƒ Macroeconomic environment and financial intermediary ƒ Financial performance (consolidated, IFRS) ƒ OTP Bank in the Region

  8. Slide 8: Main macroeconomic indicators in Hungary

    21/11/2005 Main macroeconomic indicators in Hungary 2003 2004 1H 2005 2005F* 2006F* Real GDP growth 2.9% 4.2% 3.5% 3.9% 4.2% Household consumption 7.2% 2.5% 2.3% 2.9% 3.7% Investment growth 2.5% 7.9% 6.5% 8.0% 8.0% Budged deficit (cash flow based, HUF bn) -1,361 -1,322 -988 -1,080 -1,784 as a % of G

  9. Slide 9: NBH cut the base rate by further 100 bps

    21/11/2005 In 3Q 2005 NBH cut the base rate by further 100 bps INTEREST RATES CHANGES OF BASE RATE 14% 13% 22-Dec-03, 12.50% 2003 + 400 bp 12% 22-Dec-04, 9.50% 2004 - 300 bp 11% 2005 10% 25 January 2005 -50 bp 9% 3-Jan-03, 8.50% 22 February 2005 -75 bp 23-Aug-05, 6.25% 8% 30 March 2005 -50 bp 20-Sep

  10. Slide 10: Slowly changing investment patterns

    21/11/2005 Slowly changing investment patterns… SELECTED COMPONENTS OF PFA RETAIL LOANS OUTSTANDING HUF bn 15,000 HUF bn 2006/2005F 14,392 5,000 90% CA GR +21.5% Total PFA CA GR 2000-2005F CAGR (2000-2005F) 4,545.7 2000-2005F 1,586 +14.7% 12,600 +10.2% Cash 1,890 80% +44.4% 12,000 1,418 4,000 11,050

  11. Slide 11: Room for further growth of banking penetration

    21/11/2005 …but there is still room for further growth of banking penetration BY TOTAL ASSETS RETAIL SECTOR 35,000 93.8% 100% 8,000 40% 257% 90% 7,000 35% 30,000 7,263 77.6% 88.1% 73.0% 80% 81.6% 6,000 30% 25,000 25.2% 25.5% 6,055 64.7% 62.6% 70% 24.6% 24.1% 24.9% 24.9% 5,000 5,598 25% 116% 5,167 20

  12. Slide 12: Macroeconomic indicators of foreign subsidiary countries

    21/11/2005 Main macroeconomic indicators of countries of foreign subsidiaries Bulgaria Slovakia Croatia Romania 2004 2005F 2004 2005F 2004 2005F 2004 2005F Real GDP growth 5.6% 5.4% 5.3% 4.9% 3.8% 3.1% 8.3% 6.0% Household consumption 4.8% 6.0% 3.5% 5.3% 3.9% 4.5% 10.8% 6.8% Investment growth 12.0% 1

  13. Slide 13: Agenda

    ƒ Key facts on OTP Bank ƒ Macroeconomic environment and financial intermediary ƒ Financial performance (consolidated, IFRS) ƒ OTP Bank in the Region

  14. Slide 14: Largest consolidated IFRS profit in 3Q 2005

    21/11/2005 OTP Bank realized its largest consolidated IFRS profit in 3Q 2005 OTP Group consolidated, based on IFRS 9M 2004 9M 2005 Y-o-Y 3Q 2004 2Q 2005 3Q 2005 Y-o-Y Q-o-Q Total assets (HUF bn) 3,863.8 4,910.4 27.1% 3,863.8 4,693.0 4,910.4 27.1% 4.6% Total loans and advances (HUF bn) 2,371.6 2,989.

  15. Slide 15: Consolidated total assets grew by 4.6% in 3Q 2005

    21/11/2005 Consolidated total assets grew by 4.6% in 3Q 2005 LIABILITIES ASSETS HUF bn HUF bn 5,000 4,737.6 4,693.0 4,910.4 5,000 4,737.6 4,693.0 4,910.4 Other Equity 4,500 4,166.6 4,500 4,166.6 4,000 3,863.8 3,863.8 Fixed assets 4,000 3,500 Other 3,500 Investment 3,000 3,000 securities 2,742.1 2,98

  16. Slide 16: NPL ratio and qualified loans

    21/11/2005 NPL ratio was 3.8% while portion of total qualified loans was 13.5% on September 30, 2005 QUALIFIED LOANS NPL RATIO HUF bn 450 417.6 16% 371.1 13.5% 327.7 60 12.1% 12.4% 360 301.4 53 26 11.7% 11.6% 296.4 32 12% 3.8% 50 23 3.3% 270 41 46 26 24 3.7% 3.5% 23 20 3.5% 25 23 25 8% 180 272 301 2

  17. Slide 17: Net interest margin fell by 29 bps in 3Q 2005

    21/11/2005 Net interest margin fall by 29 bps in 3Q 2005 HUF bn INTEREST INCOME NET INTEREST INCOME HUF bn 120 111.1 113.1 111.4 116.7 116.4 76.9 74.8 Q-o-Q: -0.2% 80 9.6 69.1 66.4 13.7 Y-o-Y: +4.8% 70 65.5 100 12.2 12.7 11.3 60 80 central bank 50 NII without 60 securities 40 73.5 swaps 63.0 75.9 65

  18. Slide 18: Share of non-interest income increased from 38% to 45%

    21/11/2005 Share of non-interest income in total income increased from 38% to 45% NON INTEREST INCOME COST/INCOME RATIO HUF bn Q-o-Q: +30.7% 70 63.8 Y-o-Y: +67.2% 75% 60 70% 48.8 Other 47.1 47.5 65% 66.2% 50 19.3 62.5% Insurance 38.2 60% 40 12.1 18.3 14.2 Dividend 56.8% 56.7% 12.1 55% 30 Real estate

  19. Slide 19: HUF 41 bn net profit in 3Q 2005

    21/11/2005 OTP Bank realized HUF 41 bn net profit in 3Q 2005 PROFIT BEFORE AND AFTER TAX ROE HUF bn 60 45% 41.0% 49.1 40% 50 46.1 45.9 46.5 35.5% 33.6% 32.8% 39.1 41.0 35% 38.4 38.1 40 30% 25.6% 32.1 30 26.9 25% 20% 20 15% 10 10% 5% 0 0% 3Q 04 4Q 04 1Q 05 2Q 05 3Q 05 3Q 04 4Q 04 1Q 05 2Q 05 3Q 05 Pr

  20. Slide 20: Agenda

    ƒ Key facts on OTP Bank ƒ Macroeconomic environment and financial intermediary ƒ Financial performance (consolidated, IFRS) ƒ OTP Bank in the Region

  21. Slide 21: Progress towards a regional financial group

    21/11/2005 OTP Bank has made significant progress towards establishing a regional financial group OTP Group OTP Banka Slovensko OTP Subsidiaries Number of branches** 966 Number of branches 72 Number of clients ~8 million Target countries Number of clients ~0.3 million Total assets HUF 4,910.4 bn Tot

  22. Slide 22: Main balance sheet items of OTP Group members

    21/11/2005 Main balance sheet items of OTP Group members OTP Group OTP Banka OTP Bank DSK Bank OTP banka Hrvatska OTP Bank Romania consolidated Slovensko HUF bn 3Q 2005 Y-o-Y 3Q 2005 Y-o-Y 3Q 2005 Y-o-Y 3Q 2005 Y-o-Y 3Q 2005 Q-o-Q* 3Q 2005 Y-o-Y Total Assets 4,910.4 27.1% 3,379.0 17.4% 529.4 25.1% 2

  23. Slide 23: Foreign subsidiaries realized 10.2% of net profit

    21/11/2005 The foreign subsidiaries realized the 10.2% of the consolidated net profit OTP Group OTP Banka OTP Bank DSK Bank OTP banka Hrvatska OTP Bank Romania consolidated Slovensko HUF million 3Q 2005 Y-o-Y 3Q 2005 Y-o-Y 3Q 2005 Y-o-Y 3Q 2005 Y-o-Y 3Q 2005 Q-o-Q* 3Q 2005 Q-o-Q** Interest income 11

  24. Slide 24: Market position at end of September 2005

    21/11/2005 OTP Bank and its subsidiaries market position at the end of September 2005 OTP Banka OTP Group* OTP Bank DSK Bank OTP banka Hrvatska OTP Bank Romania Slovensko 3Q 2005 Q-o-Q 3Q 2005 Q-o-Q 3Q 2005 Q-o-Q 3Q 2005 Q-o-Q 3Q 2005 Q-o-Q 2Q 2005 Q-o-Q Deposits 26.9% -0.3% 25.6% -0.4% 15.7% 0.3% 3

  25. Slide 25: Further information

    Further information For further information please contact OTP Bank Investor Relations Tel: + 36 1 473 5460 E-mail: investor.relations@otpbank.hu + 36 1 473 5457 otpbank@otpbank.hu Fax: + 36 1 473 5951 Website: www.otpbank.hu Forward looking statements This presentation contains certain forward-look

  26. Slide 26: Appendix 1: Hungarian financial market and OTP's position

    Appendix 1 The Hungarian financial market and OTP Bank’s position (Based on HAR)

  27. Slide 27: Leading position in the Hungarian financial system

    21/11/2005 OTP Group managed to keep its leading position in the Hungarian financial system MARKET SHARE* – TOTAL ASSETS MARKET SHARE* – TOTAL LOANS HUF bn HUF bn OTP Bank 5,000 30% 3,500 35% total loans 3,000 30% 4,500 25.1% 27% 24.2% 24.3% 21.9% 21.9% 21.8% 21.9% 21.4% Group total 23.7% 23.8% 2,50

  28. Slide 28: ~35% market share in retail deposits

    21/11/2005 OTP Group maintained its ~35% market share in retail deposits in Hungary RETAIL DEPOSITS OF CREDIT INSTITUTIONS MARKET SHARE – OTP GROUP HUF bn 6000 5,268 5,268 30% 38% 5,122 5,184 4,874 38% 5000 564 573 585 619 25% 569 25.1% 37% 36.5% 4000 23.3% 20% 37% 21.5% 35.9% 36.0% 36.0% 19.7% 19.8

  29. Slide 29: 53% market share in HUF housing loans

    21/11/2005 OTP Group kept its 53% market share in HUF housing loans, while share in FX housing loans increased to 21% HOUSING LOANS OF CREDIT INSTITUTIONS MARKET SHARE – OTP GROUP HUF bn 2500 25% 60% 53.3% 53.3% 53.2% 53.1% 52.9% 2,175 2,055 1,911 1,956 50% 2000 1,820 372 20% 187 272 50.8% 49.7% 49.

  30. Slide 30: Market share in consumer loans 24.7%

    21/11/2005 OTP Group increased market share in household’s consumer loans to 24.7% CONSUMER LOANS OF CREDIT INSTITUTIONS MARKET SHARE – OTP GROUP HUF bn 1600 1,380 40% 35% 28.7% 28.9% 29.7% 29.7% 29.5% 1400 1,233 35% 30% 1,123 36.8% 1200 1,093 30% 1,018 31.0% 25% 1000 233 278 508 25% 24.7% 169 382 2

  31. Slide 31: Top player in corporate banking

    21/11/2005 OTP Group is amongst the top players also in the corporate banking sector CORPORATE LOANS CORPORATE DEPOSITS HUF bn (Volume of credit institutions and OTP Group) HUF bn (Volume of credit institutions and OTP Group) 8,000 4,000 6,735 3,336 7,000 6,237 6,447 6,469 3,500 5,957 2,966 3,089 2,

  32. Slide 32: OTP Group managed 40% of mutual funds

    21/11/2005 OTP Group managed 40% of mutual funds in Hungary MARKET VOLUME OF MUTUAL FUNDS MARKET SHARE OF OTP FUNDS HUF bn 1,876 2,000 45% 1,800 1,553 1,600 1,362 43% 1,400 40.8% 1,200 1,064 41% 39.7% 869 1,000 39.0% 40.3% 800 39% 38.1% 37.8% 600 38.5% 400 37% 200 37.1% 794 965 1,226 1,336 1,608 0 3

  33. Slide 33: OTP Garancia 2nd largest life insurer

    21/11/2005 OTP Garancia is the 2th largest life insurance company in Hungary with 15.2% share of premium income LIFE AND NON-LIFE PREMIUM INCOME (MARKET) LIFE AND NON-LIFE PREMIUM INCOME (OTP GARANCIA) HUF bn 598.5 HUF bn 600 100 510.4 500 446.8 80 355.2 400 339.6 56.4 296.8 60 55.6 300 272.4 42.3 2

  34. Slide 34: Appendix 2: Additional Financial Data

    Appendix 2 Additional Financial Data

  35. Slide 35: Pro-forma segment reporting: geographical

    21/11/2005 Pro-forma segment reporting GEOGRAPHICAL Consolidation Foreign September 30, 2005 / 9M 05 HU SK BG RO CR UK Aggregated Consolidated effect ratio Assets 4,844,888 265,718 529,370 55,957 285,513 12,627 5,994,074 -1,083,630 4,910,444 19.2% Loans 2,469,428 200,277 342,204 19,496 138,746 12,18

  36. Slide 36: Pro-forma segment reporting: business lines

    21/11/2005 Pro-forma segment reporting BUSINESS LINES Other fin. Non-fin. Consolidation Share of September 30, 2005 / 9M 05 Banks Aggregated Consolidated Service Service effect banks Assets 5,614,030 336,226 43,818 5,994,074 -1,083,630 4,910,444 93.7% Loans 3,024,215 158,119 0 3,182,334 -93,360 3,08

  37. Slide 37: Main balance sheet data of OTP Group members

    21/11/2005 Main balance sheet data of OTP Group members (Based on IFRS) in HUF billion September 30, 2004 September 30, 2005 Y-o-Y % Gross Gross Gross Assets Deposits Equity Assets Deposits Equity Assets Deposits Equity loans loans loans OTP Bank Ltd. 1,227.9 2,879.0 2,209.7 359.4 1,409.8 3,379.0 2,

  38. Slide 38: Main P&L data of OTP Group members

    21/11/2005 Main P&L data of OTP Group members (Based on IFRS) in HUF million 2004 9M 2005 9M Y-o-Y Net Net Net Other Other Pre-tax After tax Other Other Pre-tax After tax Other Other After tax Interest Provisions Interest Provisions Interest incomes expenses profit profit incomes expenses profit pro

  39. Slide 39: OTP share performance on the Budapest Stock Exchange

    21/11/2005 OTP share’s performance on the Budapest Stock Exchange (From August 10, 1995 to September 30, 2005) 10,000 30/09/2005, HUF 8,165 9,000 27/09/2005, HUF 8,630 8,000 30/08/2005, HUF 7,970 01/03/2005, HUF 7,550 7,000 6,000 13/05/2005, HUF 5,820 5,000 15/04/2004, HUF 4,330 4,000 10/05/2004, HU

OTP Bank Nyrt — UBS 2nd Annual LATAM – EMEA Investor Conference (November 2005) on 6ix