Eurobank S.A. · ATHEX:EUROB
Eurobank — Q1 2015 Earnings Presentation
43 slides from Eurobank's earnings presentation, May 14, 2015
Slide 1: First Quarter 2015 Results
First Quarter 2015 Results 14 May 2015
Slide 2: Disclaimer
Disclaimer By attending the meeting where this presentation is made, or by reading the presentation slides, you agree to be bound by the following limitations: This presentation has been prepared by Eurobank. The material that follows is a presentation of general background information about Euroban
Slide 3: Table of contents
Table of contents Highlights 3 1Q2015 results review 10 International operations 21 Appendix I – Supplementary information 30 Appendix II – Macroeconomic update 38 Page 2
Slide 4: 1Q15 results highlights and key financials
1Q15 results1 Highlights Key financials €m 1Q15 4Q14 1 PPI (pre-provision income) up 7.2% q-o-q at €215.7m, mainly due to Net interest income 372.8 394.0 lower operating expenses and higher other income Commission income 76.5 79.0 Core PPI down 4.2% q-o-q, mainly due to lower net interest Other In
Slide 5: Pre-provision income (PPI)
Pre-provision income (PPI) Core and non-core PPI (€ m) Highlights 29 45 25 (9) 14 Non-core Pre-provision income at €216m, up 7.2% q-o-q and 11.0% y-o-y, mainly due to lower operating expenses and higher other income 211 202 Core PPI 178 192 Core PPI down 4.2% q-o-q, mainly due to lower NII (by 5
Slide 6: Asset quality
Asset quality 90dpd formation in Greece at €369m, due to Jan / Feb spike. Significant 90dpd coverage slow down in March 47.8% 47.2% NPEs coverage 90dpd formation in Greece driven higher by retail portfolio 56.3% 55.6% 53.6% NPE ratio at 40.1%, 90dpd ratio at 34.0% 51.1% 50.3% NPEs coverage a
Slide 7: International Operations
International Operations Net income (€ m) Highlights International operations turn profitable for the first quarter since 3Q12, with +€62m 15 €15m net profit in 1Q15 (4) All international subsidiaries profitable or break-even in 1Q15 (27) (47) On-going substantial rightsizing efforts, result i
Slide 8: Funding and liquidity
Funding and liquidity Eurosystem funding (€ bn) ELA eligible collateral (€ bn)1 Covered Other Pillar III, GTBs 34.0 32.6 & GGBs bonds 1.1 5.2 29.0 29.1 29.9 2.2 3.1 19.0 9.5 9.2 9.1 ECB Pillar II bonds Credit Claims 13.7 27.4 12.5 8.7 19.5 19.9 20.8 15.0 ELA 12.5 Unencumbered liquidity buffer in Gre
Slide 9: Capital position
Capital position Phased-in CET1 ratio Fully loaded Basel III CET11 (FLB3) 15.2% 14.6% 14.2% 14.2% (52bps) (23bps) (25bps) (45bps) 12.6% (98bps) (17bps) 10.2% (240bps) FLB3 incl. pref. FLB3 DTA phase out Minorities Preference 1Q15 adjustments result 1Q15 phase-out Minorities Other FY15 DTA, phase-out
Slide 10: Summary performance
Summary performance Balance sheet – key figures Income statement – key figures €m 1Q15 4Q14 €m 1Q15 4Q14 Gross customer loans 52,892 51,881 Net interest income 372.8 394.0 Provisions (10,005) (9,748) Commission income 76.5 79.0 Net customer loans 42,887 42,133 Operating income 463.2 463.6 Customer d
Slide 11: 1Q 2015 results review
1Q 2015 results review Page 10
Slide 12: Loans and deposits
Loans and deposits Gross loans (€ bn) Deposits (€ bn) Δ €m before FX effect, write-offs (392) 164 40 FX effect €1.0bn 52.9 122.7% 52.4 51.8 51.8 51.9 109.3% Loans/Deposits 103.4% 99.8% 103.1% 7.9 8.0 International 7.8 7.6 7.6 41.9 42.7 Greece 40.9 40.5 8.8 9.2 37.1 8.3 9.9 35.2 35.0 21.8 22.4 Busine
Slide 13: Assets
Assets Total assets (€ bn) Gross Loans Consumer 13% 77.5 Corporate 38% Mortgages 35% Small Business 42.9 Net loans and advances to customers 14% Securities Trading & other GGBs 18.2 7% 9% Securities GTBs 13% PP&E, intangibles and other assets 6.4 Other Loans and advances to banks 3.8 EFSF government
Slide 14: New time deposits spreads and client rates (Greece)
New time deposits spreads and client rates (Greece) New time deposit spreads (bps) Deposits mix (167) (173) Core (177) (184) 42% Time (190) (173) (174) (181) 58% (193) (215) (200) (208) (240) (247) (234) (259) (248) (265) (260) Core deposits share in the mix increased by 6ppt since 4Q14 (262) (264
Slide 15: Net interest income
Net interest income NII breakdown (€ m) NII per region (€ m) 375 379 394 367 373 102 103 106 International 99 105 274 275 288 268 269 Greece Loan margin 542 519 525 521 509 1Q14 2Q14 3Q14 4Q14 1Q15 NII evolution q-o-q (€ m) Capital & bonds 42 37 20 22 16 36 (1) (4) Market & Eurosystem (32) (15) (10)
Slide 16: NII: The effect of macroeconomic uncertainty / liquidity squeeze
NII: The effect of macroeconomic uncertainty / liquidity squeeze Quarter specific drivers, largely reversible +2% 11 24 11 3 402 €m 394 (4) (2) (54) (4) 373 (6) Eurosytem Funding (39) Govt Guarantee Exp. (15) 4Q14 1Q15 Bonds and other Loan margin Repos International 1Q15 normalized NII Loans / Depos
Slide 17: Spreads & net interest margin
Spreads & net interest margin Lending spreads (Greece, bps) Deposit spreads (Greece, bps) Savings 520 (30) (29) (29) and sight (42) (42) 509 503 501 489 Total Corporate (110) (138) 457 452 (151) 447 449 451 Total (170) (165) Time (192) (185) 423 425 433 (202) 418 Retail 418 (238) (268) 1Q14 2Q14 3Q1
Slide 18: Commission income
Commission income Commission income breakdown (€ m) Commission income per region (€ m) Total fees excluding 0.42% 0.40% Fees / Assets 80 86 85 90 88 Govt. guarantees 0.37% 0.38% expense 0.34% 79 77 79 70 77 70 71 71 65 14 65 26 12 12 13 Rental & other income 23 International 10 25 8 11 Insurance 25
Slide 19: Operating expenses
Operating expenses OpEx per region (€ m) OpEx breakdown (€ m) 267 (7.1%) 267 268 258 262 248 25 248 70 68 68 68 23 65 International 95 Depreciation 90 Greece 196 200 190 194 183 Administrative 147 135 Staff 1Q14 2Q14 3Q14 4Q14 1Q15 1Q14 1Q15 Cost-to-income ratio (%) Headcount and network evolution (
Slide 20: 90dpd gross formation per segment (Greece)
90dpd gross formation per segment (Greece) Mortgages (€ m) Consumer (€ m) 245 221 234 216 205 190 201 171 160 164 138 1Q15 147 149 143 135 117 122 119 115 115 103 109 100 92 94 89 79 76 84 82 72 72 66 56 54 43 55 41 35 13 17 3Q10 1Q11 3Q11 1Q12 3Q12 1Q13 3Q13 1Q14 3Q14 1Q15 Mar 15 3Q10 1Q11 3Q11 1Q1
Slide 21: Asset quality metrics
Asset quality metrics 90dpd & and coverage per segment Non Performing Exposures (EBA) >90dpd Provisions >90dpd ratio 90dpd Coverage >90dp NPF1 Other Total NPEs Provisions and (%) (€ bn) (%) d 0-89dpd Impaired NPEs ratio over NPEs collaterals (€ bn) (€ bn) (€ bn)2 (€ bn) (%)3 (%) over NPEs(%) Consume
Slide 22: International operations
International operations Page 21
Slide 23: International presence
International presence Total Assets (€ bn) 1.4 Net Loans (€ bn) 0.3 Deposits (€ bn) 1.1 Total Assets (€ bn) 1.3 Net Loans (€ bn) 0.8 Deposits (€ bn) 0.8 Total Assets (€ bn) 3.3 Branches (#) 83 Net Loans (€ bn) 2.0 Deposits (€ bn) 1.8 Branches (#) 158 Total Assets (€ bn) 3.3 Net Loans (€ bn) 2.2 Tota
Slide 24: Income statement highlights
Income statement highlights Core PPI (€ m) Pre Provision Income (€ m) 1Q14 11 2Q14 15 68 63 2 ROM 1 62 61 61 3Q14 14 14 1 4 LUX 5 4Q14 13 12 14 10 15 13 CYP 1Q15 14 10 9 9 10 SER 1Q14 17 17 22 22 BUL 2Q14 20 24 22 ROM BUL 3Q14 22 23 21 4Q14 23 15 11 10 1Q15 22 1Q14 2Q14 3Q14 4Q14 1Q15 1Q14 10 2Q14 9
Slide 25: Net profit
Net profit Total (€ m) Romania (€ m) Bulgaria (€ m) 15.2 2.3 4.6 (4.4) (4.0) (5.4) (10.8) (16.1) (20.1) (27.2) (27.7) (47.4) (46.3) (78.0) (101.7) 1Q14 2Q14 3Q14 4Q14 1Q15 1Q14 2Q14 3Q14 4Q14 1Q15 1Q14 2Q14 3Q14 4Q14 1Q15 Serbia (€ m) Cyprus (€ m) Luxembourg (€ m) 7.7 8.0 7.3 7.3 5.7 4.3 4.2 1.0 1.9
Slide 26: Operating expenses
Operating expenses OpEx per Country (€ m) OpEx breakdown (€ m) 70 (8.0%) 70 69 68 69 65 3 3 4 4 65 LUX 9 6 6 6 4 8 5 12 13 6 CYP Depreciation 13 12 11 30 20 SER 29 20 20 19 19 BUL Administrative 30 27 27 28 25 ROM 31 28 Staff 1Q14 2Q14 3Q14 4Q14 1Q15 1Q14 1Q15 Cost-to-income ratio (%) Cost-to-averag
Slide 27: Gross Loans
Gross Loans Romania (€ m) Bulgaria (€ m) 2,659 2,629 2,575 2,595 2,631 2,598 2,547 2,546 2,516 2,542 405 404 642 641 606 400 395 389 Consumer 631 606 16% Consumer 23% 45% 802 797 785 54% 792 784 31% 793 781 779 772 826 Mortgage Mortgage 32% 3M15 1,424 3M15 1,224 1,207 Business 1,397 1,354 1,337 1,36
Slide 28: Deposits
Deposits Romania (€ m) Bulgaria (€ m) 2,512 2,542 2,572 2,454 2,387 876 842 775 1,898 1,875 1,879 951 Time 1,804 1,820 921 32% 33% Time 1,257 1,328 1,303 1,248 1,224 68% 67% 1,561 1,666 1,731 1,679 Core 1,466 Core 547 571 573 631 595 3M15 3M15 3M14 1H14 9M14 FY14 3M15 3M14 1H14 9M14 FY14 3M15 Serbia
Slide 29: Asset quality
Asset quality Romania Bulgaria 69.2% 62.9% 63.0% Coverage 65.5% 67.5% 59.5% Coverage 56.1% 55.4% 52.5% 52.2% 31.2% 31.9% 31.4% 31.8% 90dpd 29.4% 22.6% 23.0% 23.4% 23.2% 23.0% 90dpd 57 90dpd gross 90dpd gross formation 32 24 formation 20 5 (€ m) 16 14 (€ m) (7) (1) (7) 1Q14 2Q14 3Q14 4Q14 1Q15 1Q14 2
Slide 30: Key figures
Key figures Romania Bulgaria Serbia Cyprus Lux Sum Assets 3,305 3,296 1,304 3,574 1,386 12,865 Gross loans 2,595 2,542 903 1,576 337 7,953 Balance Sheet (€m) Net loans 2,038 2,174 810 1,521 336 6,879 Balance Sheet 90dpd Loans 825 585 147 101 2 1,660 Deposits 1,820 2,454 750 3,215 1,124 9,363 Operati
Slide 31: Appendix I – Supplementary information
Appendix I – Supplementary information Page 30
Slide 32: Consolidated quarterly financials
Consolidated quarterly financials Income Statement (€ m) 1Q15 4Q14 3Q14 2Q14 1Q14 Net Interest Income 372.8 394.0 378.6 375.3 367.2 Commission income 76.5 79.0 70.9 69.9 64.5 Other Income 13.9 (9.4) 25.3 44.6 29.2 Operating Income 463.2 463.6 474.8 489.8 460.9 Operating Expenses (247.6) (262.4) (257
Slide 33: Consolidated financials
Consolidated financials Income Statement (€ m) 3M15 3M14 Δ y-o-y (%) Net Interest Income 372.8 367.2 1.5 Commission income 76.5 64.5 18.6 Other Income 13.9 29.2 (52.3) Operating Income 463.2 460.9 0.5 Operating Expenses (247.6) (266.6) (7.1) Pre-Provision Income 215.7 194.3 11.0 Loan Loss Provisions
Slide 34: Income statement highlights (Greece)
Income statement highlights (Greece) Operating income (€ m) Operating expenses (€ m) 354 196 200 190 194 183 345 338 334 327 1Q14 2Q14 3Q14 4Q14 1Q15 1Q14 2Q14 3Q14 4Q14 1Q15 Provision charge (€ m) Net income before non-recurring charges (€ m) 652 (101) 422 414 383 (200) (198) 260 (252) (345) 1Q14 2
Slide 35: Private Banking
Private Banking Market leader in Greece with holistic servicing model in 3 countries AuM (€ bn) Data as of March 2015 Relationship 6.5 AuM (€ m) Clients (#) 6.2 6.3 6.3 6.0 Managers (#) 0.9 0.9 1.0 1.3 1.1 2.2 2.3 2.2 Greece 2,748 3,592 47 2.3 2.1 3.1 Luxembourg 2,082 1,090 11 3.1 3.1 2.9 2.7 Cyprus
Slide 36: Asset Management
Asset Management Market leader in Greece with 44.9% market share in mutual funds AuM (€ m) Net flows (€ m) 1,055 4,035 77 Institutional 249 Asset Equity Management 540 Fund of funds 978 Mutual Funds 352 Special 227 2,882 30 purpose 74 20 151 246 107 76 13 20 54 (13) 303 Balanced (6) 318 Mutual (36)
Slide 37: Securities services and Equity brokerage
Securities services and Equity brokerage Securities Services Eurobank Equities Clear market leader in institutional custody in domestic capital markets, over Dominant position in domestic capital markets, consistently ranking the past 10 years number one over the past 5 years The only Greek pr
Slide 38: Eurolife ERB Insurance
Eurolife ERB Insurance Insurance Operations Overview Key Consolidated Financials (IFRS basis) 3rd largest insurance provider in Greece in 2014, operating both in life and non-life segments, focused on retail €m 1Q15 1Q14 Wholly-owned holding company created in 2014 to streamline ownership Gross
Slide 39: Appendix II – Macroeconomic update
Appendix II – Macroeconomic update Page 38
Slide 40: Domestic economy built positive momentum in 2014, but renewed standstill
Domestic economy built positive momentum in 2014, but latest data point to a renewed standstill Domestic economy built positive momentum in 2014 Real GDP up 0.8% in 2014, with strong gains recorded in most expenditure-side components positive private consumption growth following 5 consecutive year
Slide 41: Positive economic growth still expected in 2015, but lower
Positive economic growth still expected in 2015, but lower than that forecasted initially Timely agreement with official creditors on the current program review (and, most importantly, on a follow up arrangement) should facilitate improvement in GDP dynamics in H2 2015 Improvement to be primary
Slide 42: Short-term risks & challenges
Short-term risks & challenges State financing Sizeable funding needs and limited domestic sources of financing in 2015 €14bn in interest & amortization payments in Jun-Dec (c. €10bn in Q3) & rollover of sizeable T-bill exposures Borrowing requirement much more manageable in 2016-2020 (less than
Slide 43: Investor Relations contacts
Investor Relations contacts Dimitris Nikolos +30 210 3704 754 E-mail: dnikolos@eurobank.gr Yannis Chalaris +30 210 3704 744 E-mail: ychalaris@eurobank.gr Christos Stylios +30 210 3704 745 E-mail: cstylios@eurobank.gr Ariadni Kranidioti +30 210 3704 764 E-mail :akranidioti@eurobank.gr Group E-mail: i