Banque Cantonale Vaudoise · SIX:BCVN
Banque Cantonale Vaudoise — FY2019 Earnings Presentation
37 slides from Banque Cantonale Vaudoise's earnings presentation, Feb 27, 2020
Slide 1: 2019 Full-Year Results
2019 Full-Year Results Analysts’ presentation 27 February 2020 1
Slide 2: Disclaimer
Disclaimer Waiver of liability. While we make every reasonable effort to use reliable information, we make no representation or warranty of any kind that all information contained in this document is accurate or complete. We disclaim all liability or responsibility for any loss, damage or injury tha
Slide 3: Agenda
Agenda Introduction FY 2019 financial results Strategy and Outlook Pascal Kiener, CEO Thomas W. Paulsen, CFO Pascal Kiener, CEO Full-Year 2019 Financial Results 3
Slide 4: Key messages
Key messages Sustained growth in key businesses and revenues up 3%, despite the ongoing negative-interest-rate environment Operating profit up 4% to CHF 419m, also underpinned by continuing strict cost control Net profit up 4% year on year to CHF 363m, its highest level in twelve years Proposal to i
Slide 5: FY 2019 key figures
FY 2019 key figures CHF (rounded) Revenues Operating profit Net profit 1.0bn 419m 363m +3% +4% +4% 1.0 Total assets AuM 48.4bn 97.8bn +1% +12% Full-Year 2019 Financial Results 5
Slide 6: Main business trends
Main business trends CHF millions (rounded) Mortgage loans Sight deposits1 AuM +4% +10% +12% 26'079 27'016 20'098 97'840 18'335 87'620 31 Dec. 31 Dec. 31 Dec. 31 Dec. 31 Dec. 31 Dec. 2018 2019 2018 2019 2018 2019 0.5 0.5 0.5 Other loans Other client deposits Net new money +1% -1% +3,832 5'677 5'752
Slide 7: Other highlights
Other highlights Eftychia Fischer to be AA rating from S&P with a stable outlook proposed as new Board member at the next AGM Aa2 rating from Moody’s with a stable outlook 1.0 0.5 CHF 301m distributed to shareholders in UNPRI signatory May for the 2018 fiscal year; i.e., CHF 35 as of 1 July 2019 per
Slide 8: Retail Banking
Retail Banking CHF millions (rounded)1 Mortgage loans Customer deposits +4% +7% § Continuing rise in mortgage loans, in line 8'003 8'296 8'523 9'086 with market pace § Customer deposits up – no negative interest rates charged to retail customers 31 Dec. 31 Dec. 31 Dec. 31 Dec. 2018 2019 2018 2019 §
Slide 9: Corporate Banking
Corporate Banking CHF millions (rounded)1 Loans/off-BS commitments Customer deposits +1% +6% Solid momentum in Corporate Banking 17'319 17'563 9'595 10'142 businesses § SMEs - Loans and off-balance-sheet commitments up 5% - Customer deposits up 4% § Large Corporates 31 Dec. 31 Dec. 31 Dec. 31 Dec. 2
Slide 10: Wealth Management
Wealth Management CHF millions (rounded)1 AuM Mortgage loans +13% +2% § Growth in AuM 7'781 64'411 72'741 7'661 - NNM from institutional and onshore private banking clients - Positive performance in financial markets § Continuing increase in mortgage loans 31 Dec. 31 Dec. 31 Dec. 31 Dec. 2018 2019 2
Slide 11: Trading
Trading CHF millions (rounded)1 Revenues Operating profit +10% +36% § Forex trading still accounts for 2/3 of 50 22 Trading revenues. Stable compared to 2018 45 16 § High business volumes in the equities, bonds, fixed income, and structured products segments FY FY FY FY 2018 2019 2018 2019 Revenues
Slide 12: Agenda
Agenda Introduction FY 2019 financial results Strategy and Outlook Pascal Kiener, CEO Thomas W. Paulsen, CFO Pascal Kiener, CEO Full-Year 2019 Financial Results 12
Slide 13: Income statement
Income statement CHF millions (rounded) FY 2018 FY 2019 Change Total income from ordinary banking operations 977 1,002 +25 +3% Operating expenses -500 -504 +4 +1% Depreciation & amortization of fixed assets and impairment on -69 -71 +2 +4% equity investments Other provisions and losses -5 -7 +2 +54%
Slide 14: Total income from banking operations
Total income from banking operations CHF millions (rounded) Total income from ordinary banking operations 1,002 +25 +3% § Net interest income – Up 976 § Commissions & fees – Increase driven by 490 507 Net interest income +17 +3% Wealth Management § Trading – Stable 317 323 Commissions & fees +6 +2%
Slide 15: Operating expenses, depreciation and amortization
Operating expenses, depreciation and amortization CHF millions (rounded) 569 575 +6 +1% § Continued firm control of operating expenses 167 165 Other operating expenses § Other operating expenses down -2 -1% continuously since 2011 (-2% per year on average) § Personnel costs slightly up § Depreciatio
Slide 16: Headcount
Headcount Full-time equivalents at period-end -41 § Increase in headcount due to the insourcing +1 -4 -21 -26 +25 of 20 IT development specialists 1,987 1,946 1,947 1,943 1,922 1,921 1,896 214 205 213 204 197 192 Subsidiaries § Gradually decreasing depreciation and 196 amortization charge for IT dev
Slide 17: Assets
Assets CHF billions (rounded) 47.9 48.4 +0.5 +1% § Cash and equivalents – Continued increase in SNB sight deposits despite the 8,2 8,4 Cash and equivalents +0.2 +2% ongoing negative-interest-rate environment Due from banks and reverse 2,2 1.4 repo agreements -0.8 -36% § Loans and advances to custome
Slide 18: Liabilities and equity
Liabilities and equity CHF billions (rounded) 47.9 48.4 +0.5 +1% § Customer deposits – Continued increase 3,2 Due to banks despite the ongoing negative-interest-rate 4,5 -1.3 -28% environment § Shareholders’ equity – Up CHF 64m 33,0 Customer deposits +1.6 +5% 31,4 Bonds and mortgage-backed 7,2 7,1 -
Slide 19: Assets under management
Assets under management CHF billions (rounded) Assets under management +12% § AuM up 12% to CHF 97.8bn 97.8 87.6 +6.4 5.7 Piguet +3.8 § Net new money of CHF 3.8bn 5.2 Galland 82.4 92.2 § Performance of +CHF 6.4bn BCV 31 Dec. Net new Performance 31 Dec. 2018 money 2019 Net new money 3.8 § Onshore net
Slide 20: Capital ratios
Capital ratios CHF billions (rounded) Risk-weighted assets and CET1 ratio RWAs FINMA minimum target CET1 ratio Common Equity Tier 1 § CET1 ratio stable at 17.1% CET1 ratio Leverage ratio - Business growth, mainly in residential 18.3% mortgages 17.7% 17.5% 17.1% 17.1% 17.1% - Increase in retained ear
Slide 21: Liquidity ratio (LCR)
Liquidity ratio (LCR) CHF millions (rounded) HQLAs1 LCR Minimum requirement § LCR has increased since H1 2019 mainly Net cash outflows1 due to lower net cash outflows 129.5% § Composition of the Bank’s HQLAs 116.9% 116.7% 115.9% 112.3% - 67%: cash deposited with the SNB 106.9% - 33%: mainly Swiss-is
Slide 22: 2019 dividend
2019 dividend CHF per share Ordinary dividend Tax-exempt distribution § Current dividend policy (2018-2022) 36 - Applicable as of the 2018 dividend 35 32 32 32 32 32 33 33 33 - Between CHF 34 and CHF 38 per share 30 31 10 10 10 10 10 10 10 10 10 10 § Proposal at 2020 AGM: Dividend of CHF 36 35 per s
Slide 23: BCV target ratios
BCV target ratios Target C/I ratio 57%-59% • Minimum target: minimum equity level Capital ratio 13.0%1 at which BCV can run its business while being crisis-robust • Target ROE at minimum CET1 target ROE 13.5%-14.5% • ROE of 10.4% calculated on equity above minimum target Note (1) Common Equity Tier
Slide 24: Stock split
Stock split § Make BCV shares more accessible to private investors § Reduce the share price to a level comparable to peers 1 BCV share 10 BCV shares = Share price CHF 800 CHF 80 each (illustrative) Dividend per Between CHF 34 and CHF 38 Between CHF 3.4 and CHF 3.8 share § If approved by shareholders
Slide 25: Agenda
Agenda Introduction FY 2019 financial results Strategy and Outlook Pascal Kiener, CEO Thomas W. Paulsen, CFO Pascal Kiener, CEO Full-Year 2019 Financial Results 25
Slide 26: Vision for 2025
Vision for 2025 A similar bank, building on today’s strong fundamentals • Diversified business model with moderate risk profile • Solid customer franchise and retail footprint • Strong financials • Solid governance 6 objectives to build 2025’s BCV • High-quality service as a competitive differentiat
Slide 27: Main strategic objectives
Main strategic objectives Real-estate Retail Banking Independent AMs Grow at least at Professionals market pace in Vaud Forex E-brokerage Onshore Private SMEs Target above-market Banking growth in Vaud Asset Management Custodian Bank Wealth Planning Structured Trade Finance Products Focus on profita
Slide 28: Swiss and Vaud GDP growth
ETTRE A JOUR Swiss and Vaud GDP growth In % Swiss GDP (source: SECO1) Vaud GDP (source: CREA2) § Lower GDP growth in 2019 (around 1.5%) due to the global economic slowdown Estimate at January 2020 3.0 2.9 § In 2020: GDP growth probably lower than 2.5 2.4 2,5 January 2020 estimate (between 1.3% - 2,3
Slide 29: Real estate in Vaud
Real estate in Vaud Transaction prices in Vaud (Basis 100 in Dec. 2009) Apartments Single homes 150 144 +2.3% § Prices on Vaud real-estate transactions have 137 138 138 141 increased steadily over the past 52 weeks 140 135 131 132 130 +2.8% - Up 2.3% on apartments 130 126 126 127 122 124 121 121 - U
Slide 30: 2020 Outlook
2020 Outlook Business trends in line with 2019 Low revenue growth expected given the current interest-rate environment 1.0 Continued firm control of operating expenses Full-Year 2019 Financial Results 30
Slide 31: Calendar
Calendar 27 February 2020 30 March 2020 30 April 2020 5 May 2020 Full-year 2019 Publication of the Annual Ex-dividend date1 results 2019 Annual Report Shareholders’ Meeting in Lausanne 1.0 6 May 2020 7 May 2020 28 May 2020 20 August 2020 Dividend record Dividend payment1 Stock split2 Half-year 2020
Slide 32: Appendices
Appendices r 4 BCV
Slide 33: Income statement
Income statement CHF millions (rounded) FY 2019 FY 2018 Abs % Interest and discount income 570.3 573.1 -2.7 -0 Interest and dividend income from financial investments 27.9 31.0 -3.1 -10 Interest expense -101.4 -108.0 -6.7 -6 Net interest income before loan impairment charges/reversals 496.9 496.1 0.
Slide 34: Balance sheet
Balance sheet CHF millions (rounded) 31 Dec. 2019 31 Dec. 2018 Abs % Cash and cash equivalents 8,384 8,235 149 2 Due from banks 1,186 1,921 -735 -38 Reverse repurchase agreements 239 314 -75 -24 Loans and advances to customers 5,752 5,677 75 1 Mortgage loans 27,016 26,079 937 4 Trading portfolio ass
Slide 35: Key performance indicators
Key performance indicators 31 Dec. 31 Dec. 31 Dec. 31 Dec. 31 Dec. 2015 2016 2017 2018 2019 Impaired loans/ 0.7% 0.7% 0.7% 0.6% 0.5% credit exposure Customer deposits/ Asset quality 98% 98% 101% 99% 101% loans to customers and balance sheet structure Liquidity Coverage Ratio (LCR) 111% 113% 121% 113
Slide 36: BCV share
BCV share Per share (CHF) Stock price 46,8 48,7 820 46,3 44,5 44,9 40,6 42,2 39,1 37,2 800 36,0 Operating profit 780 EPS 760 740 720 0 2015 2016 2017 2018 2019 1 Jan. 2019 31 Mar. 2019 30 Jun. 2019 30 Sep. 2019 31 Dec. 2019 Key figures 31 Dec. 31 Dec. 31 Dec. 31 Dec. 31 Dec. 2015 2016 2017 2018 2019
Slide 37: BCV Investor Relations iPad App
BCV Investor Relations iPad1 App Our BCV Investor Relations app keeps you in touch with the latest developments at BCV Group It brings together everything of interest to shareholders, investors and analysts, including: § An overview of BCV § Our key figures § Annual and interim reports § Press relea
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