Credito Emiliano S.p.a. · MIL:CE
Credito Emiliano — FY2006 Earnings Presentation
26 slides from Credito Emiliano's earnings presentation, March 2007
Slide 1: CREDEM FY2006 Results
CREDEM FY2006 Results 1 Investor Relations march 2007
Slide 2: CREDEM at a Glance
• CREDEM at a Glance • Key Data & Strategy • FY2006 Results • 2006- 2008 Business Plan recap 2 Investor Relations march 2007
Slide 3: Main Facts
Main Facts • Based in Emilia Romagna, one of Italian richest regions • Listed on Milan Stock Exchange since 1997 and market cap around EURbn 3 • 510 branches and corporate centres in Italy • 780,000 customers and over EURbn 70 in customer total business* • RATINGS : A- S&P Long Term – Outlook Positi
Slide 4: Focus on Emilia-Romagna
Focus on Emilia-Romagna Main Industrial Districts REGGIO EMILIA • Region of Emilia-Romagna rating: Aa2 stable /A+ MIRANDOLA agricoltular stable, Moody’s/S&P biomedical BOLOGNA machinery, motorbikes, fashion CARPI • About 4.1 million people (7% of the Italian packaging machinery PIACENZA knitwear pop
Slide 5: Shareholding Structure
Shareholding Structure Pact among 229 More than 2,900 other shareholders shareholders Main Shareholders Maramotti family 35.5% Pictet Cie 4.9% Eredi Savioli 2.9% Fincorrad 2.1% Allianz Subalpina 1.7% 72.9% 27.1% CREDEMHOLDING Free Float on Milano Stock Exchange 71.9% 28.1% CREDEM 5 Investor Relation
Slide 6: Business Areas
Business Areas Commercial Banking Wealth Management Investment Banking Other CREDEM 100% 98.5% 50% * 100% 100% Life Insurance 100% 100% 50% * 69.7% 100% FIDUCIARIA Spa General Insurance 100% * na 100% * 100% 100% 100% 100% 100% *Not consolidated 6 Investor Relations march 2007
Slide 7: Network and Human Resources
Network and Human Resources Group branches as at 30 September, 2006 12/31/05 12/31/06 +1 Swiss branch Credem Branches & others 433 448 B.ca Euromobiliare Branches 22 21 3 Total Branches 455 469 67 16 18 Corporate Centres 40 41 6 128 Credem Points 24 25 14 6 Banca Euro Financial Stores 36 37 3 3 18 1
Slide 8: CREDEM at a Glance
• CREDEM at a Glance • Key Data & Strategy • FY2006 Results • 2006-2008 Business Plan recap 8 Investor Relations march 2007
Slide 9: Trends & Comparisons
Trends & Comparisons Key Indicators Revenues growth 1,061 945 1,100 1,000 816 69 FY04 FY05 FY06 54 131 900 101 800 43 79 EBIT/Total Income 30.1% 35.2% 39.2% 700 421 EURm 600 415 Revenues per Employee (EUR,000) 164.0 190.0 211.4 376 500 Oper. Costs per Employee (EUR,000) 108.6 123.9 123.3 400 Non Int
Slide 10: 1990 – 2006: Long Term Strategy
1990 – 2006 : Long Term Strategy 1990 – 1999 2000 – 2003 2004 – 2006 ACQUISITIONS ORGANIC GROWTH PROFITABILITY • Acquisition of more than 30 • Divisionalisation • Value creation from acquired small banks potential • 113 new branches opened • Acquisition in 1994 of • Central role of CREDEM’s core Eur
Slide 11: 2006-2008 Business Plan Guidelines
2006-2008 Business Plan Guidelines STRATEGY 2008 GOALS CENTRAL ROLE OF CORE BUSINESS EXCELLENCE IN VALUE CREATION OVER TIME • Commercial Banking and Wealth Management activities generating well above 80% of Group’s • ROE consistently above 17% EBIT • Net Profit growing 11% cagr to 243 €million • Tar
Slide 12: Organic Growth: a choice confirmed
Organic Growth: a choice confirmed 106 NEW branches and 40 corporate centres opened Loans & Fundings market shares - Italy s : n 6 year 26.0 si 24.0 v o lume a n k! 1.66% 22.0 ne w a ll b 1.50% 1.60% of m 1.53% 1.51% gas 20.0 1.50% 18.0 bil lions i rin 1.45% 16.0 24 acqu 1.25% 14.0 like 12.0 1.00% 1
Slide 13: Value Creation
Value Creation ROE EPS EUR .1% Avg 15 23.2% 21.3% 0.90 0.82 19.3% 13.5% 14.6% 0.51 0.51 11.6% 11.1% 0.39 0.40 0.35 8.5% 0.26 14.8% 0.22 0.17 13.5% cagr 15.7% 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Dividend and Payout Ratio Capital Adequacy
Slide 14: CREDEM at a Glance
• CREDEM at a Glance • Key Data & Strategy • FY2006 Results • 2006-2008 Business Plan recap 14 Investor Relations march 2007
Slide 15: Tableau de Bord
Tableau de Bord Total Income Cont’d Operating Costs 1,100 618.8 +5.5% 1,060.9 586.4 1,000 945.3 +12.2% 600 900 500 216.1 230.3 +6.6% 800 620.6 700 EURm 569.7 +8.9% 400 EURm 600 500 300 400 +4.9% 300 200 370.3 388.5 200 375.6 440.3 +17.2% 100 100 0 0 FY05 FY06 FY05 FY06 Net interest income Non-intere
Slide 16: Income Statement
Income Statement EURm FY/05 FY06 % yoy Total Income breakdown EURm FY05 FY06 % yoy Total Income 945.4 1,060.9 12.2 -586.4 -618.8 Net Interest Income 375.,7 440.3 17.2 Operating Costs 5.5 Commercial Spread 3.08% 3.39% +31bps* EBITDA 359.0 442.1 23.1 Avg loan rate 4.07% 4.64% +57bps Amortization and D
Slide 17: Dedication to Core Business
Dedication to Core Business Contribution to FY06 consolidated results 2006 Net Profit breakdown Core business Other activities EURm FY05 FY06 %y/y Total Income 87.9% 12.1% Core business 185.7 194.8 87.9% Credem (incl. Credem Lux) 158.6 159.9 68.9% Operating Costs 89.1% 10.9% Banca Euromobiliare 6.8
Slide 18: Lending
Lending Lending to retail customers grew 20.4% yoy while small business grew 18.9%. Corporate clients lending grew 1.2%, with a stronger focus on SMEs (+12.2%). In 2003 the group started reducing Large Corporate exposures in favour of the other segments, shaping the loan book as it currently looks.
Slide 19: Credit Quality
Credit Quality • Credit quality consistently high, with an NPL ratio of 0.22% • The management and collection of loans securitized in late 2000 (0.18% at December ‘05) compared to an industry average of continued with success. As at 30 December, 2006: 1.2% (Sources: Bank of Italy) - EURm 198 collect
Slide 20: Funding
Funding EURm 2005 2006 % yoy Mutual Funds breakdown Deposits 8,758 10,020 14.4 100% 359.3 Flex Bonds 3,738 4,431 18.5 751.3 702.0 90% Portfolio Management 5,175 5,931 14.6 80% 2,182.0 27.8% 1,899.7 24.0% 1,885.0 29.6% Cash Mutual Funds and SICAVs 10,576 8,969 -15.2 70% 7,950 60% of which Mutual Fund
Slide 21: CREDEM at a Glance
• CREDEM at a Glance • Key Data & Strategy • FY06 Results • 2006-2008 Business Plan recap 21 Investor Relations march 2007
Slide 22: Actions
Actions • 82 new branches, 2 new Corporate Centers, 9 closings. A larger, more up-to-date network. Areas to focus Selective increase for the growth: Nord East, North West, Tuscany and Marche. of the distribution network • New retail distribution model to aim at an higher effectiveness. Addition of m
Slide 23: 2008 Targets
2008 Targets CAGR Total Income Cont’d Operating Costs CAGR 1,200 1,158 7.0% 800 945 674 4.7% 700 900 586 649 4.5% 600 250 5.0% EURm 500 216 EURm 570 600 400 300 10.6% 300 509 200 423 370 4.6% 376 100 0 0 2005 2008P 2005 2008P Net interest income Non-interest income Payroll costs Admin. expenses Prof
Slide 24: 2008 Targets (cont'd)
2008 Targets Customer Cash Loans CAGR Cont’d Funding from Customers CAGR 15 80 6.8% 11.2% 67.5 60 55.3 17.3 27.7 3.5% EURbn EURbn 12 40 25.0 12.6 22.7 8.1% 20 18.0 3.7 8.0 29.0% 9 8.6 9.0 1.5% 0 2005 2008P 2005 2008P Customers deposits Bonds AUM AUC TIER I Distribution Channels 1,200 8% 600 62 7.7%
Slide 25: 2008 P&L
2008 P&L EURm 2005 2008P CAGR Total Income CAGR will reach 7% with a strong contribution from 05-08 the interest income. Net Interest Income 376 509 10.6% Operating Costs, including D&A are expected to increase by 5% Net Commissions 415 474 4.6% reflecting increasing commercial investments estimated
Slide 26: 2008 Network
2008 Network 2004 2005* 2008P Distribution networks will grow through: •73 new Branches net increase (82 new openings and 9 Credem Branches 441 433 504 branches closings) B.ca Euromobiliare Branches 22 22 24 Total Branches 463 455 528 •2 new Corporate Centres Corporate Centres 39 40 42 •2 new Financ
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