Hrvatska Postanska Banka D.d. · ZSE:HPB
Hrvatska Postanska Banka D.d — Hrvatska poštanska banka — Future of Public Companies - Dubrovnik, April 2016
24 slides from Hrvatska Postanska Banka D.d's conference presentation, April 2016
Slide 1: Reorganization, Recapitalization and Results of HPB – The Largest Bank in Croatian Ownership
REORGANIZATION, RECAPITALIZATION AND RESULTS OF HPB – THE LARGEST BANK IN CROATIAN OWNERSHIP Tomislav Vuić, President of the Management Board Future of Public Companies - Dubrovnik, April 2016
Slide 2: Successful 2015
Successful 2015 • EU’s approval of the recapitalization process (DG Competition – MEO) • Recapitalization through public offer, amounting to HRK 550 mln – 55% private investors ~ 25% of total ownership • Bank reorganization • Increase in market share, loans and retail deposits • Substantial improvem
Slide 3: To follow advice outlined in this presentation does not necessarily mean you will not make any mistakes
TO FOLLOW ADVICE OUTLINED IN THIS PRESENTATION DOES NOT NECESSARILY MEAN YOU WILL NOT MAKE ANY MISTAKES Every company is a unique story as restructuring goals and executives’ ambitions are frequently different. Nevertheless, some rules I have learnt in the first two mergers out of 6 transformations
Slide 4: HPB – Successful, Universal Bank
HPB – SUCCESSFUL, UNVERSAL BANK (customer focus, excellence, taking responsibility, achievement-oriented culture, agility/speed, teamwork) RETAIL CORPORATE SEGMENT SEGMENT - 632.000 clients - 8 regional centers - 53 business units throughout Croatia - 421.000 current - 9.471 business giro accounts a
Slide 5: FY 2015 results exceeded strategic guidelines presented to European Commission and private investors
FY 2015 RESULTS EXCEEDED STRATEGIC GUIDELINES PRESENTED TO EUROPEAN COMMISSION AND PRIVATE INVESTORS 2014 2015 | MEO1 PLAN 2015 PLAN 2016 | MEO PLAN 2016 Total assets HRK 17,4 bn. HRK 17,7 bn. | 17,6 bn. HRK 18,1 bn. | 18,1 bn. BALANCE SHEET Gross loans HRK 12,4 bn. HRK 12,4 bn.2 | 12,9 bn. HRK 13,3
Slide 6: 2014 – Pros and cons of taking office as President of the Management Board
2014 – PROS AND CONS OF TAKING OFFICE AS PRESIDENT OF THE MANAGEMENT BOARD • Insufficient capital adequacy • 636.000 clients in total • Recapitalization under approval of the European • 1.000 offices of Croatian Post Commission (threat of bank recovery and even • Large depositor base liquidation of
Slide 7: What is important for every restructuring
WHAT IS IMPORTANT FOR EVERY RESTRUCTURING PRECONDITIONS MAIN FOES • Motivation * • Demotivation (often in the beginning) • Ignorance (with regard to profession, trends, neglecting education and savings, • Knowledge narrow horizons) • Fear (of changes, for existential security, • Courage personal and
Slide 8: Always strike a balance!
ALWAYS STRIKE A BALANCE! Need for change due to unsustainable existing model Retain the company healthy aspects of the company, motivated and enthusiastic employees Decrease in costs – always necessary (potential is limited, requires minimal knowledge but firm will, large layoffs and savings are not
Slide 9: Change in corporate culture – most important goal of human resources
CHANGE IN CORPORATE CULTURE – MOST IMPORTANT GOAL OF HUMAN RESOURCES 1st level Development management out of 21- 13 new (external 10, internal 3)/62% programs for Competency model Q1 2015 Q2 2015 Q3 2015 Q4 2015 management dynamics; 4 3 2 4 Corporate culture Talent 2nd level management management ou
Slide 10: 2015 – Bank with highest return on equity in Croatia
2015 – BANK WITH HIGHEST RETURN ON EQUITY IN CROATIA ROAE C/I indicator * BANK SECTOR * • operating improvements & convergence with the • MEO PLAN exceeded during 2015.: sector average 9,4% actual vs. 9,0% planned • better effects without processes being changed • MEO PLAN exceeded during 2015: • Co
Slide 11: Banking sector & HPB – Action & Reaction
BANKING SECTOR & HPB – ACTION & REACTION OPERATING EXPENSES AND COSTS (YoY) • Fierce competition and revenue downtrend -2,2% • Focus on costs • HPB is adapting by: -5,6% -6,0% -6,0% - lowering interest rates and fees - decreasing operating costs 2014 2015 - Increasing loans in a decreasing market -
Slide 12: Media about HPB
MEDIA ABOUT HPB ukupni krediti krediti stanovništvu +7,2% 4,35% 4,42% 4,77% +8,1% +7,3% +5,8% 3,71% 4,04% 3,46% (0,0%) 2014 2015 2016E * (0,5%) (1,6%) (2,3%) (5,0%) 2014 2015 2016E* (0,7%) (0,8%) (1,5%) y-o-y stope HPB SEKTOR tržišni udio y-o-y stope HPB SEKTOR tržišni udio ukupni depoziti depoziti
Slide 13: Once again - the most important of all
ONCE AGAIN - THE MOST IMPORTANT OF ALL • Client orientation (real benefit – fair price – availability) • Culture of defining, monitoring and achieving goals (excellent performance management system) • Excellent IT (for a bank) • Clear and communicated strategy, open- mindedness to new ideas and cour
Slide 14: Size and strength do not matter, but ability to adapt to changes does
SIZE AND STRENGTH DO NOT MATTER, BUT ABILITY TO ADAPT TO CHANGES DOES Future of Public Companies - Dubrovnik, April 2016 14
Slide 15: Appendix
APPENDIX HPB AND FELLOW COLLEAGUES DURING THE RECAPITALIZATION PROCESS: David Tomašek, Domagoj Karadjole, Darko Blagović - DUUDI, Dubravka Kolarić, Krešimir Dragić – Ministry of Finance, Tomislav Vuić, Hrvoje Bujanović – PBZ , Marijana Liszt – Law Office Posavec, Rašica & Liszt, Goran Horvat - KPMG,
Slide 16: Resume and experience in transformations and mergers
RESUME AND EXPERIENCE IN TRANSFORMATIONS AND MERGERS • 2014 – today Hrvatska poštanska banka – CEO • Merger of Trgovačka banka d.d., Zagreb, Čakovečka • 2003 – 2014 Erste & Steiermärkische Bank d.d., Croatia – banka d.d. Čakovec and Bjelovarska banka d.d. Bjelovar deputy CEO • Merger of Riječka bank
Slide 17: Recapitalization, EU Commission, partial privatization and regular activities - simultaneously
RECAPITALIZATION, EU COMMISSION, PARTIAL PRIVATIZATION AND REGULAR ACTIVITIES - SIMULTANEOUSLY BACKGROUND TO RECAPITALIZATION & ACHIEVED DURING 2015 RECAPITALIZATION IN 2015 HNB performed on-site examination of HPB during Q2 2014 defining HPB’s development strategy – on sound foundations Sep 2014 –
Slide 18: HPB – Best bank in Croatia by quality of services and products, market growth and profitability
FIRST PRESENTATION TO WIDER NUMBER OF MANAGERS 2014 - motivation HPB – Best bank in Croatia by quality of services and products, market growth and profitability Is this possible? Is it possible to achieve this at the same time? Is he serious? Are we the best bank already? How can we do it? In which
Slide 19: Clients, Shareholders, Employees
FIRST PRESENTATION TO WIDER NUMBER OF MANAGERS 2014 Clients Shareholders Without them there is no bank, whilst Expect earnings which are paid-out, without quality services and products bank profitability – security and trust, there are no clients. Ever-demanding, especially in the long run. ever-pro
Slide 20: Savings in 2015 – vigilant procurement, renegotiations with suppliers
SAVINGS IN 2015 – VIGILANT PROCUREMENT, RENEGOTIATIONS WITH SUPPLIERS C/I indicator BANK - HRK 24 million of savings (annualized) achieved through cost management activities SECTOR - savings effective mostly from H1 2015, but significant improvements are already accomplished - 2016 and onwards shoul
Slide 21: Capitalization in the past
CAPITALIZATION IN THE PAST HPB has historically been undercapitalized when compared to its competitors, and close to legal minimum Capital Adequacy Ratio 21,4 21,0 20,9 20,9 19,6 18,8 16,4 16,4 15,2 14,0 16,8 15,9 14,9 14,2 13,5 11,7 11,5 11,2 10,1 6,7 2006 2007 2008 2009 2010 2011 2012 2013 2014 20
Slide 22: Slight uptrends in indicators during the restructuring year
SLIGHT UPTRENDS IN INDICATORS DURING THE RESTRUCTURING YEAR – SUBSTANTIAL POTENTIAL FOR IMPROVEMENT Selected indicators of largest banks in Croatia for 2014 and 2015 Assets per employee (HRK million) C / I indicator 27,7 25,5 25,1 60,1% 58,9% 24,2 23,7 24,1 48,3% 51,5% 47,3% 47,1% 16,0 16,6 40,2% 38
Slide 23: Product development in spite of complex recapitalization & reorganization processes
PRODUCT DEVELOPMENT IN SPITE OF COMPLEX RECAPITALIZATION & REORGANIZATION PROCESSES Housing loans in HRK with combination of fixed and Deposits variable interest rate – refinancing Motiv Plus General purpose loans Mobile banking Always in HRK HPB m-banking Currently most modern solution in Croatia C
Slide 24: Disclaimer
DISCLAIMER This presentation was prepared for the sole purpose of presenting HPB p.l.c. (later in the text: ”HPB” or ”the Bank”) to the attendees of regional conference Future of Public Companies (later in the text: ”the Conference”), which is to be held on Apr 15 2016 in Dubrovnik. The presentation
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