Brd Groupe Societe Generale Sa (romania) · BVB:BRD
Brd Groupe Societe Generale Sa (romania) — BRD Groupe Société Générale — H1 2020 Earnings Presentation
31 slides from Brd Groupe Societe Generale Sa (romania)'s earnings presentation, Aug 4, 2020
Slide 1: BRD Group Results
BRD GROUP RESULTS 2nd quarter and 1st half 2020 | 04.08.2020
Slide 2: Disclaimer
DISCLAIMER The consolidated and separate financial position and income statement for the period ended June 30, 2020 were examined by the Board of Directors on July 30, 2020. The financial information presented for the period ended June 30, 2020 and comparative periods has been prepared according to
Slide 3: Introduction
1 INTRODUCTION BRD GROUPE SOCIETE GENERALE
Slide 4: Our reaction to the crisis
OUR REACTION TO THE CRISIS We entered a worldwide unprecedented sanitary crisis Pandemic confirmed to have reached Romania on February 26, with more than 47,000 COVID-19 cases State of emergency lasting for 2 months, with severe lockdown restrictions, easing progressively started mid May Fourt
Slide 5: Resilient operational performance
RESILIENT OPERATIONAL PERFORMANCE Sustained corporate lending activity Corporate loan portfolio Lending to large corporate clients, up by +4.6% y/y at June 2020 end +5.4% vs June 2019 end Retail production impacted by lockdown, but back to pre-crisis level in Total loan portfolio late June +1.2% vs
Slide 6: Macroeconomic environment
2 MACROECONOMIC ENVIRONMENT
Slide 7: COVID-19 crisis puts an end to a 9 year expansionary cycle
COVID-19 CRISIS PUTS AN END TO A 9 YEAR EXPANSIONARY CYCLE Q1 2020 confirmed the end of the expansionary phase of the cycle EU GDP registered the sharpest decline observed since 1995, when reporting started, as COVID-19 containment measures began to be GDP GROWTH widely introduced 7.0% Romania’s GDP
Slide 8: Rate cut and quantitative easing in place
RATE CUT AND QUANTITATIVE EASING IN PLACE Policy rate cut To support the economy in the context of unfolding COVID-19 epidemic, the central bank reduced the monetary policy rate twice INTEREST RATE ENVIRONMENT this year to 1.75%, 75 basis points under 2019 level 3.2% 3.2% 3.2% Quantitative easing 3.
Slide 9: Extensive policy offset
EXTENSIVE POLICY OFFSET Relief measures to support the economy Loan facility program (IMM INVEST) : envelop of EUR 3 bn of state guarantee and interest subsidies to support SME sector financing Income supporting measures : indemnity for technical unemployment (amounting to 75% of the net salary, c
Slide 10: Romanian banking sector entered the crisis with a healthy profile
ROMANIAN BANKING SECTOR ENTERED THE CRISIS WITH A HEALTHY PROFILE ROMANIAN BANKING SYSTEM Solid capital and liquidity positions NPL AND NPL COVERAGE RATIOS Loan to deposit ratio at 71% at March 2020, same as at 2019 end 60.6% 61.0% (vs 122% at 2008 end) 55.6% 57.7% 56.2% 57.7% 58.5% Average liquidit
Slide 11: 2nd Quarter and 1st Half 2020 BRD Group Results
3 2ND QUARTER AND 1ST HALF 2020 BRD GROUP RESULTS
Slide 12: Quickly adapting to address the crisis situation and ensure business continuity
QUICKLY ADAPTING TO ADDRESS THE CRISIS SITUATION, ENSURE BUSINESS CONTINUITY AND PROVIDE OPERATIONAL SUPPORT TO OUR CLIENTS Protect our customers and employees through implementation of adequate sanitary measures and prevention actions in all business outlets Ensure business continuity with exte
Slide 13: Fully committed to support our clients with financing solutions
FULLY COMMITTED TO SUPPORT OUR CLIENTS WITH FINANCING SOLUTIONS Moratorium Deferral in loan repayment granted for 44k individuals clients as of June 2020 end, postponements granted between 3 and 9 months, for RON 2.9 bn (~14 % of portfolio) Grace period for SB clients: RON 65m (~12% of portfol
Slide 14: Acceleration of our digital roadmap
ACCELERATION OF OUR DIGITAL ROADMAP Contact Center FAST ADOPTION OF DIGITAL HIGHLY REACTIVE CUSTOMER ADAPTED PHYSICAL SET UP CHANNELS INTERACTION CENTER Growing digital penetration Fast tracked Customer Interaction Fewer branches Centre capabilities to answer More specialized 651k MyBRD Mobile &
Slide 15: Strong growth of corporate financing activity
STRONG GROWTH OF CORPORATE FINANCING ACTIVITY NET LOANS Sustained corporate financing activity (end of period amounts, RON bn) Y/Y Loans to SME up by +7.2% y/y and large companies advance 30.6 31.3 31.0 +1.2% of +4.6% y/y 8.5 8.9 8.9 +5.4% Active participation in IMM Invest Programme Overall leasing
Slide 16: Dynamic deposit collection
DYNAMIC DEPOSIT COLLECTION Consolidation of already broad retail deposit base Increasing retail deposits (+8.1% y/y) with an almost double yearly pace vs previous quarter Individuals’ savings up +7.5% y/y (o/w current accounts were up by +32% y/y) SAVINGS (end of period amounts, RON bn) Y/Y Corporat
Slide 17: Impact of crisis on revenues in line with expectations
IMPACT OF CRISIS ON REVENUES IN LINE WITH EXPECTATIONS NET BANKING INCOME (RON m) Resilient NII over the 1 st semester Quasi stable NII in H1 2020 (-0.3% y/y) benefitting from positive Y/Y volume effect induced by growing deposits -6.0% 1,609 NII lower (-6.9% y/y) in Q2 2020 1,512 Other income 177 -
Slide 18: Opex dynamics reflecting strict control of sundry costs and lower regulatory charges
OPEX DYNAMICS REFLECTING STRICT CONTROL OF SUNDRY COSTS AND LOWER REGULATORY CHARGES OPERATING EXPENSES (RON m) OPEX evolution for H1 2020, w/o regulatory costs, impacted by: Y/Y measures taken to address the sanitary crisis 804 800 -0.5% 72 43 -40.0% (acquisition of protection materials for emplo
Slide 19: Strong asset quality
STRONG ASSET QUALITY GROSS LOANS – June 30, 2020 breakdown by segment and currency (RON bn) Loan portfolio market mix 70% on individuals market segment 30% on legal entities market segment 20.9 21.5 Consolidation of RON lending Share of RON denominated loans at 67.8% (vs 67.1% as of June 2019 end) 9
Slide 20: Cost of risk incorporating deteriorated macroeconomic context
COST OF RISK INCORPORATING DETERIORATED MACROECONOMIC CONTEXT COST OF RISK EVOLUTION 538 2,083 438 Net cost of risk at 205 bps in Q2-20 (vs 59 bps in Q1- 1,883 20), driven mainly by: 338 1,193 1,193 • Updated macroeconomic scenarios embedding Covid context, 238 198 205 800 137 leading to higher expe
Slide 21: Very solid capital position
VERY SOLID CAPITAL POSITION SOLVENCY RATIO Strong high quality capital base -27bp CAR of 27% at June 2020 end +49bp +145bp Regulatory own funds composed solely of Tier 1 capital Increase in own funds on a yearly basis mainly driven by the +528bp retention of the entire 2019 net profit, considering (
Slide 22: Conclusions
.) CONCLUSIONS BRD GROUPE SOCIETE GENERALE
Slide 23: Conclusions
CONCLUSIONS Entered a strong and unprecedented crisis Quickly and successfully adapted our organization to protect employees and customers, and to ensure business continuity Stand by our clients in these difficult times loan moratorium active participation in IMM INVEST sustained corpora
Slide 24: Q&A Session
6 Q&A SESSION BRD GROUPE SOCIETE GENERALE
Slide 25: Appendix
APPENDIX BRD GROUP – KEY FIGURES BRD STANDALONE - KEY FIGURES STOCK PRICE PERFORMANCE FINANCIAL CALENDAR FOR 2020 GLOSSARY – CLIENT SEGMENTATION
Slide 26: BRD Group | Key Figures
BRD GROUP | KEY FIGURES (1) Variations at constant exchange rate; (2) Bank only, including impact of prudential filters in Sep-17 and Dec-17; RON m Q2-2020 Q2-2019 Change H1-2020 H1-2019 Change Net banking income 745 824 -9.6% 1,512 1,609 -6.0% Operating expenses (374) (362) +3.5% (800) (804) -0.5%
Slide 27: BRD | Key Figures for Bank Only
BRD | KEY FIGURES FOR BANK ONLY (1) Variations at constant exchange rate; (2) Bank only, including impact of prudential filters in Sep-17 and Dec-17; RON m Q2-2020 Q2-2019 Change H1-2020 H1-2019 Change Net banking income 712 822 -13.4% 1,433 1,566 -8.5% Financial results Operating expenses (353) (33
Slide 28: BRD | Stock Price Performance
BRD | STOCK PRICE PERFORMANCE Market capitalisation 4,000 EUR 1.7 bn 16.0 3,500 3,000 14.0 2,500 12.0 2,000 10.0 1,500 1,000 8.0 500 6.0 0 Volume ('000 shares, rhs) Price (RON, lhs) BRD is part of the main market indices on the Bucharest Stock Exchange BRD is in Top 5 largest domestic companies
Slide 29: Financial Calendar for 2020
FINANCIAL CALENDAR FOR 2020 6th February: Preliminary 2019 financial results and annual press conference 23rd April: General Shareholders Meeting for approving the 2019 annual financial results 7th May: Presentation of the 1st quarter 2020 financial results 3rd August: Presentation of the 2nd quarte
Slide 30: Glossary – Client Segmentation
GLOSSARY – CLIENT SEGMENTATION The Retail category is comprised of the following customer segments: • Individuals – BRD provides individual customers with a range of banking products such as: savings and deposits taking, consumer and housing loans, overdrafts, credit card facilities, funds transfe
Slide 31: BRD Groupe Societe Generale - Investor Relations
BRD GROUPE SOCIETE GENERALE - INVESTOR RELATIONS +4 021 380 47 62 | investor@brd.ro; www.brd.ro
BRD Groupe Société Générale — H1 2020 Earnings Presentation on 6ix