Komercni Banka, a.s. · PSECZ:KOMB
Komercni Banka, a.s — 9M 2004 Earnings Presentation
38 slides from Komercni Banka, a.s's earnings presentation, Oct 27, 2004
Slide 1: Financial Results as at 30 September 2004
Financial Results as at 30 September 2004 (International Financial Reporting Standards) Prague - 27 October 2004
Slide 2: Highlights of the First Nine Months of 2004: Retail business keeps performing
HIGHLIGHTS OF THE FIRST NINE MONTHS OF 2004 Retail business keeps performing Year-on-year comparison • Number of customers increased by 8% to 1,395 thousand mainly due to individual clients • 827 thousand users of KB direct banking channels, i.e. +46% more than last year, out of which more than 200
Slide 3: Highlights of the First Nine Months of 2004: Net Banking Income up 4%
HIGHLIGHTS OF THE FIRST NINE MONTHS OF 2004 Net Banking Income went up by 4% Year-on-year comparison • Net interest income grew by 5% • Non-FX fees and commissions increased by 5% • Successful cost management; total costs’ increase below 3% • Cost of risk at a stable level of 42 bp • Net profit amou
Slide 4: Komerční banka - Bank of the Year 2004
KOMERČNÍ BANKA - BANK OF THE YEAR 2004 Prestigious prize for KB awarded by experts’ jury in the 3rd year “MasterCard Bank of the Year Competition“ ¾ Appreciation of the Bank’s services and performance ¾ Commitment of all employees of KB for the future Unconsolidated Financial Results as at 30 Septem
Slide 5: New and innovated products
HIGHLIGHTS OF THE FIRST NINE MONTHS OF 2004 New and innovated products In July KB launched Max - Global Guaranteed Fund that enables clients to profit from the growth on world equity markets, while providing a 100% guarantee of return of investment by the fund’s maturity. KB started to offer selecte
Slide 6: Content
CONTENT • Business Performance • Financial Performance • Loan Portfolio Development • Appendix Unconsolidated Financial Results as at 30 September 2004 – Prague – 27 October 2004 5
Slide 7: Loan Portfolio Development: 13% solid growth of the loan portfolio
LOAN PORTFOLIO DEVELOPMENT 13% - solid growth of the loan portfolio Volume of loans Individuals gross amount, without loans transferred to ČKA, CZK billion SME Corporates Other + 13.2% 151.0 • Year-on-year increase of the loan 141.0 143.7 portfolio by 13.2% 137.2 133.4 38.2 • Business loans increase
Slide 8: Deposits: Solid deposit base
DEPOSITS Solid deposit base Volume of primary client deposits* Individuals CZK billion SME Corporates Other + 1.7% 343.1 345.5 351.8 349.7 344.0 • Year-on-year stable clients’ deposits • Current accounts of CZK 210.4 billion 127.9 126.0 127.7 127.6 128.7 make up 59% of total primary deposits; term d
Slide 9: Retail Loans: Loans to individuals and SB on rise
RETAIL LOANS Loans to individuals and SB on rise Mortgages Consumer loans Loans to Small Businesses Total volume outstanding in CZK mil. Total volume outstanding in CZK mil. Total volume outstanding in CZK mil. 28,218 + 41% 20,041 + 17% 10,023 + 47% 6,347 8,566 4,329 30. 9. 2003 30. 9. 2004 30. 9. 2
Slide 10: Individuals and Small Businesses - Penetration
INDIVIDUALS AND SMALL BUSINESSES - PENETRATION Penetration ratios expand significantly Penetration ratio* 30. 9. 2003 31.12.2003 30. 9. 2004 Change 3Q 04/ 3Q 03 Individuals PACKAGES 45.4 49.0 59.9 + 31.9% MORTGAGES 2.0 2.1 2.4 + 20.0% CONSUMER LOANS 8.2 8.4 9.5 + 15.9% PAYMENT CARDS 62.5 63.0 65.8 +
Slide 11: Payment Cards: Utilisation of cards keeps increasing
PAYMENT CARDS Utilisation of cards keeps increasing 30. 9. 2003 30. 9. 2004 YonY Change Payment cards - 960 thousand 1,179 thousand +22.8% active Credit cards - active 30,827 52,641 +70.8% Number of POS 9,577 12,049 +25.8% (points of sales using electronic device) 1-3Q 2003 1-3Q 2004 Number of 50,10
Slide 12: Corporate and Investment Banking
CORPORATE AND INVESTMENT BANKING KB – leader in the market • KB leader in the domestic syndicated loan market: 7 transactions with total volume of CZK 26 billion • M&A advisory (valuations, buy and sell side) : 9 mandates in 2004 • Implementing complex cash management for clients managing large volu
Slide 13: Content
CONTENT • Business Performance • Financial Performance • Loan Portfolio Development • Appendix Unconsolidated Financial Results as at 30 September 2004 – Prague – 27 October 2004 12
Slide 14: Financial Results and Ratios
FINANCIAL RESULTS AND RATIOS Growth in the core banking revenues by 4% CZK million, unconsolidated Profit and Loss Statement 1-3Q 2003 1-3Q 2003 1-3Q 2004 Change 04/03 pro forma Net banking income 16,535 16,257 16,827 + 3.5% Operating costs -8,546 -8,546 -8,767 + 2.6% Net operating income 7,989 7,71
Slide 15: Net Interest Income
NET INTEREST INCOME Increasing NII driven by lending volumes and deposits CZK million, unconsolidated Net Banking Income Net Interest Income Other NII from loans NII from deposits + 3.5% 9,387 16,827 8,902 16,257 - 20.6% 1,181 • Continuing positive trend of NII: year- 1,488 on-year increase of 5.4%
Slide 16: Net Fees and Commissions
NET FEES AND COMMISSIONS Non-FX F&C growth driven by lending and banking services CZK million, unconsolidated Net Banking Income Net Fees and Commissions Non-FX FX clean payments + 3.5% 6,408 6,528 FX cash conversions 16,827 16,257 • Growth in Non-FX F&C driven by increasing numbers and volumes main
Slide 17: Trading Profits and Other Income
TRADING PROFITS AND OTHER INCOME Trading profits driven by client operations CZK million, unconsolidated Net Banking Income Net profit from financial operations FX operations Net profit from fair value changes of Securities and security 860 AFS securities during 3q 2003 derivatives Interest and Comm
Slide 18: Operating Costs: Cost/Income Ratio under 53%
OPERATING COSTS Cost/Income Ratio under 53% CZK million, unconsolidated Personnel expenses Operating Costs Released over accruals 4,031 -5.2% 3,820 • In both 1Q 2003 and 1Q 2004 260 168 release of over accruals of 3,771 - 3.2% 3,652 bonuses; without this the personnel cost would have decreased by 5%
Slide 19: Operating Costs Q-on-Q
OPERATING COSTS Q-on-Q Operating costs under control CZK million, unconsolidated Depreciation, impairment and disposal of fixed assets General administrative expenses Personnel expenses 3,242 3,033 2,880 3,011 2,876 2,809 2,704 425 415 436 340 373 404 345 1,170 1,326 1,223 1,412 1,261 1,003 1,353 1,
Slide 20: Provisions for Loan Losses and Impairment of Securities
PROVISIONS FOR LOAN LOSSES AND IMPAIRMENT OF SECURITIES, NET PROFIT FROM SALE OF SUBSIDIARIES AND ASSOCIATES CZK million, unconsolidated Total loan loss provisions and impairment of securities Provisions for loan losses Changes in values of securities (booked directly to equity in 2004) Impairment o
Slide 21: Balance Sheet
BALANCE SHEET CZK million, unconsolidated Assets Liabilities and shareholders’ equity Change Change 447,565 447,565 432,823 432,823 Cash and balances 12,340 Amounts due 18,959 with central bank 19,001 + 54.0% 16,605 - 12.4% to banks Amounts due from 201,638 215,720 + 7.0% banks Amounts due 349,505 3
Slide 22: Shareholders' Equity
SHAREHOLDERS’ EQUITY Development since the end of 2003 CZK million Total shareholder’s equity Total shareholder’s equity as at 31 December 2003: - 2,908 as at 30 September 2004: 40,399 37,491 Shareholders’ equity 31.12.2003 1.1.2004 Increase Decrease 30.9.2004 pro forma* Share capital 19,005 19,005
Slide 23: Content
CONTENT • Business Performance • Financial Performance • Loan Portfolio Development • Appendix Unconsolidated Financial Results as at 30 September 2004 – Prague – 27 October 2004 22
Slide 24: Gross Loans to Customers
GROSS LOANS TO CUSTOMERS 10% growth of the portfolio and low cost of risk CZK million Client loans Specific and general provisions for loan losses On-balance sheet On-balance sheet Excluding loans of CZK 1,290 mil. transferred to ČKA in June 2004 150,952 + 10.0% 137,170 5,077 + 8.6% 5,515 Total stan
Slide 25: CDO Portfolio: Further increase of the coverage
CDO PORTFOLIO Further increase of the coverage As of 30 September 2004 Specific provisions / Invested amount Date of acquisition: September 2000 - April 2001 Initial invested amount: USD 426 mil. 21.7% 19.3% Invested amount as at 30. 9. 2004: USD 345 mil. Total coverage (as at 30. 9. 2004): USD 75 m
Slide 26: Content
CONTENT • Business Performance • Financial Performance • Loan Portfolio Development • Appendix Unconsolidated Financial Results as at 30 September 2004 – Prague – 27 October 2004 25
Slide 27: Financial Results and Ratios - Consolidated
FINANCIAL RESULTS AND RATIOS – CONSOLIDATED CZK million Profit and Loss Statement 1-3Q 2003 1-3Q 2003 1-3Q 2004 Change 04/03 pro forma Net banking income 17,401 17,128 17,191 + 0.4% Operating costs - 9,525 - 9,525 - 9,132 - 4.1% Income from not fully consolidated companies and exclusion of subsidiar
Slide 28: Subsidiary and Associated Undertakings Results
SUBSIDIARY AND ASSOCIATED UNDERTAKINGS RESULTS As at 30 September 2004, CZK mil., CAS/SAS Share of KB Profit after tax Equity Assets ASIS, a.s.* 100% NA NA NA ESSOX, s.r.o. 51% -34 177 1,004 Factoring KB, a.s. 100% 19 146 3,212 Investiční kapitálová společnost, a.s. 100% 111 242 298 Komercni Finance
Slide 29: Number of Clients
NUMBER OF CLIENTS Thousands Individuals + 105 thousands clients Entrepreneurs and +8% y-on-y Corporates 1,350 1,369 1,395 1,331 1,290 992 1,034 1,055 1,075 1,103 298 297 295 294 292 September 2003 December 2003 March 2004 June 2004 September 2004 Unconsolidated Financial Results as at 30 September 2
Slide 30: Direct Banking
DIRECT BANKING Number of users of KB direct banking services keep growing Guaranteed Payment PC Banking Y-on-Y Increase Internet Banking + 46% 826,779 Phone Banking 770,818 25,143 713,965 24,887 23,574 647,032 24,197 23,296 22,735 206,994 23,657 567,290 185,394 22,040 23,786 168,174 21,466 146,738 1
Slide 31: Sales Network for All Segments
SALES NETWORK FOR ALL SEGMENTS Individuals Medium & Enterprises Small and Corporates Businesses Municipalities 334 37 8 Points MEM Business Corporate Business of Sales Centers Centers (including 40 regional branches) Number of ATMs grew year on year by 43 to the total of 541 Unconsolidated Financial
Slide 32: Key Products for Individuals
KEY PRODUCTS FOR INDIVIDUALS Financial Packages 30. 9. 2003 30. 9. 2004 YonY Change 163,442 208,100 + 27.3% IDEAL packages packages 132,131 275,789 + 108.7% PERFEKT KONTO packages packages 56,888 73,780 + 29.7% EXPRESS KONTO packages packages 24,188 24,231 + 0.2% A-KONTO packages packages 77,669 97,
Slide 33: Key Products for Small Businesses
KEY PRODUCTS FOR SMALL BUSINESSES Financial Packages 30. 9. 2003 30. 9. 2004 YonY Change 19,422 73,293 EFEKT 277.4% packages packages 5,442 20,014 KOMFORT 267.8% packages packages 514 1,371 EXCELENT 166.7% packages packages 0 5,121 N.A. OPTIMUM MEDICUM packages 4,617 total loans 9,670 total loans 10
Slide 34: Cross-Selling Activities within the KB Group
CROSS-SELLING ACTIVITIES WITHIN THE KB GROUP Products sold through 1-3Q 2003 1-3Q 2004 Change 04/03 KB network Life insurance Vital (premium written in CZK bil.) 1.96 1.87 -6% Mutual funds (sales in CZK bil.) 7.7 4.5 -42% Pension insurance (inflows in CZK bil.) 0.8 1.1 +38% Building saving 30,180 4,
Slide 35: Development of KB's Share Price and Index PX50
DEVELOPMENT OF KB’s SHARE PRICE AND INDEX PX50 CZK 900 3 400 3 200 800 3 000 2 800 700 2 600 600 2 400 2 200 500 2 000 400 1 800 1 600 300 31.12.02 31.3.03 30.6.03 30.9.03 31.12.03 31.3.04 30.6.04 30.9.04 KB PX 50 Unconsolidated Financial Results as at 30 September 2004 – Prague – 27 October 2004 34
Slide 36: Interest Rates Evolution
INTEREST RATES EVOLUTION 5,00% 4,50% 4,00% 3,50% 3,00% 2,50% 2,00% 31.12.01 31.3.02 30.6.02 30.9.02 31.12.02 31.3.03 30.6.03 30.9.03 31.12.03 31.3.04 30.6.04 30.9.04 Pribor 3M Pribor 6M KB Reference Rate ČNB REPO Unconsolidated Financial Results as at 30 September 2004 – Prague – 27 October 2004 35
Slide 37: Structure of Shareholders
STRUCTURE OF SHAREHOLDERS Major shareholders of Komerční banka, a. s. with over 5% of the share capital as at 30 September 2004 Number of shares outstanding - 38 million Others Société Générale S.A. 33.73% 60.35% The Bank of New York ADR Department 5.92% Unconsolidated Financial Results as at 30 Sep
Slide 38: Contacts: Investor Relations
CONTACTS Investor Relations Ilona Katzová Martin Skoumal Head of Investor Relations Investor Relations Officer Telephone: +420 222 432 156 Telephone: +420 222 432 155 E-mail: ilona_katzova@kb.cz E-mail: martin_skoumal@kb.cz Unconsolidated Financial Results as at 30 September 2004 – Prague – 27 Octob