Raiffeisen Bank International Ag · VIE:RBI
Raiffeisen Bank International — Q3 2020 Earnings Presentation
61 slides from Raiffeisen Bank International's earnings presentation, Nov 12, 2020
Slide 1: Raiffeisen Bank International Q3 Results
Raiffeisen Bank International Q3 Results – 12 November 2020
Slide 2: Disclaimer
Disclaimer Certain statements contained herein may be statements of Subject to applicable securities law requirements, we disclaim communicated or caused to be communicated (all such future expectations and other forward-looking statements about any intention or obligation to update or revise any fo
Slide 3: Business & Financial Update
01 02 03 Business & Financial Risk Update Appendix Update Johann Strobl Group Investor Relations 12 November 2020 3
Slide 4: Financial Year 2020 YTD Executive Summary
Financial Year 2020 YTD Executive Summary Consolidated profit CET 1 1-9/2020 30/9/2020, fully loaded, incl. result ▪ Consolidated profit lower mainly from higher risk EUR 599 mn 13.1% costs and other impairments ▪ FY 2019 dividend remains deducted from CET1 -32 % y-o-y -88 bps ytd ratio (41 bps) Loa
Slide 5: Q3/2020 Income Statement and KPIs
Q3/2020 Income Statement and KPIs (in EUR mn) Q3/2020 % q-o-q % y-o-y Net interest income 770 -7% -11% Net interest margin Net fee and commission income 433 +10% -8% Q3/2020 Net trading income & fair value result 33 +30% - 2.00% Other operating components1) 38 -14% >500% -20 bps q-o-q Operating inco
Slide 6: Q3/2020 Core Revenue Trends
Q3/2020 Core Revenue Trends Net interest income is impacted by FX and interest rate cuts Q3/2020 NII impacted by Net interest margin development EUR 770 mn ▪ Russia down EUR 21 mn from RUB depreciation and rate cuts ▪ Balance sheet expansion mainly in GC&M, Corporate Center and Czech Republic 881 86
Slide 7: Opex Initiatives on Track
Opex Initiatives on Track General administrative expenses EUR 75 mn opex eliminated in 2020, supporting continued in EUR mn investments in our digital transformation y-o-y Staff expenses 402 405 TOM ▪ Target Operating Model (TOM) execution is well on 367 -6% Other update track administrative expense
Slide 8: Q3/2020 Segments Overview
Q3/2020 Segments Overview Core revenues Loans to customers / NIM Provisioning ratio Profit after tax Q3/2020 q-o-q Q1/2020 Q2/2020 Q3/2020 Q3/2020 q-o-q Q3/2020 q-o-q 286 30,000 29,615 29,571 5.00% 29,334 CE Net Fees 101 +7 % 39 3.00% bps EUR 53 mn 29,000 2.13% 1.00% -17 bps -7 % 185 -6 % 1.91% 1.74
Slide 9: Balance Sheet and Loan Growth
Balance Sheet and Loan Growth 30/9/2020 ∆ q-o-q 30/9/2020 ∆ q-o-q Assets (in EUR mn) 164,779 +1% Liabilities (in EUR mn) 164,779 +1% Loans to banks 9,868 +7% Deposits from banks 30,212 -2% Loans to customers 91,711 -2% Deposits from customers 99,800 +1% Securities 21,921 -2% Debt issued and other li
Slide 10: Capital Ratios
Capital Ratios Regulatory capital requirements Q3/2020 Development (including results) RBI ▪ P2R of 2.25% now fully optimized: Regulatory 17.8% ▪ 1.27% met with CET1, 42 bps with AT1 and 56 bps with T2 ▪ P2G of 1.00%; to be entirely held in CET1 (now 15.1% 14.91% applicable to all capital layers) Ti
Slide 11: CET 1 Ratio Development
CET 1 Ratio Development Q-o-Q -17 bps Regulatory CRR "Quick-fixes" 13.2% +17 bps 13.1% +15 bps +2 bps -6 bps -31 bps -14 bps Q4 Software assets: 2020 + 10-15 bps (fully loaded) 1 2 3 4 Credit Operational Market FX Deduction Retained Sovereign exposure in EU risk risk risk effect items earnings curre
Slide 12: Funding and Liquidity
Funding and Liquidity Liquidity ratios Comfortable position across the Group 170% ▪ LCR remain elevated across network 160% 140% ▪ Strong customer deposit stock across the Group 139% 131% 122% ▪ Nearly full utilization of TLTRO 3 limit in June by head 109% 112% 111% 113% office ▪ Loan to deposit rat
Slide 13: Retail Digital Transformation
Retail Digital Transformation 1 Retail growth ambitions on Customer growth Mobile banking penetration Digital sales track Customer growth and digital 11.5 11.7 12.5 55% 34% 35% 40% penetration unaffected by 35% 23% Covid-19 2019 Q3 Ambition 2019 Q3 Ambition 2019 Q3 Ambition 2020 2021 2020 2021 2020
Slide 14: Branch Transformation and IT Synergies in Retail
Branch Transformation and IT Synergies in Retail 3 Branch transformation to take out EUR 62 mn p.a. of retail opex by year end 2022 Committed to reducing retail opex, savings partially reinvested in digital transformation Optimizing the footprint 3 Cost of distribution ▪ ~300 branches to be closed a
Slide 15: Corporate Banking Digital Transformation
Corporate Banking Digital Transformation Drive digital transformation Share of digital Share of digital KYC account opening ✓ Strengthened digital sales and service offerings for corporates (including eKYC, eSignature, eAccount, eLending) ✓ First deals in digital trade finance (‘eSpeedtrack’) closed
Slide 16: Macro Outlook
Macro Outlook 2019 2020e 2021f 2022f 2020f 2021f ▪ After a stronger than expected rebound in Q3, Euro area Real GDP (% y-oy) Change to previous GDP should decline again in Q4, following re-introduction forecast 8/2020 in PP of restrictions. A noticeable acceleration of business-cycle CE Czech Rep. 2
Slide 17: Outlook and Targets
Outlook and Targets Loan Growth We expect modest loan growth in 2020 Risk Costs The provisioning ratio for FY 2020 is currently expected to be around 75 basis points, depending on the length and severity of disruption Cost / Income Ratio We aim to achieve a cost / income ratio of around 55 per cent
Slide 18: Risk Update
01 02 03 Business & Financial Risk Update Appendix Update Hannes Mösenbacher Group Investor Relations 12 November 2020 18
Slide 19: Total Exposure and Credit Portfolio Development
Total Exposure and Credit Portfolio Development Total exposure by segments, in EUR bn, Q3/2020 Total exposure by sector, in EUR bn, Q3/2020 Total: EUR 201.0 bn, +1.1% (q-o-q) Total: EUR 201.0 bn GC&M +2.4 % Mortgages 24 Retail 92.41 Consumer loans & other 17 20.4 % CE -0.2% Sovereigns & supranationa
Slide 20: RWA Development
RWA Development RWA development in Q3/2020 RWA by segment in EUR bn 1 Non-retail credit risk up EUR 0.4 bn mainly due to new corporate business in Austria and Romania and net rating migrations, partly offset by FX impact (RUB, UAH, BYN); Retail credit risk down by EUR 0.2 bn mainly due to FX effect
Slide 21: Overview Moratoria
Overview Moratoria Loans and advances subject to moratoria (as of 30/9/2020) Main industries and countries under moratoria Gross carrying amount Residual maturity Risk perspective (outstanding) of moratoria > 3 months Subject to forward Non-performing looking life-time Real Estate EUR 709 mn provisi
Slide 22: Rating Distribution of Retail Exposure
Rating Distribution of Retail Exposure Private individuals Rating distribution: Total exposure Industry of customers‘ employers 30/9/2020 30/9/2020 30/9/2020 70% Moderate COVID-19 impact Under moratoria: (1-3) Minimal risk to very good and U-shaped recovery 50% (4-6) Good; sound; acceptable 23% 39%
Slide 23: Recovery Assumptions by Industry
Recovery Assumptions by Industry High For each industry recovery assumptions based on: 3a 3c ▪ Shape of recovery and assumptions on the post-pandemic outlook ▪ Impact of Covid: Severity and direct impact of lockdown measures Impact of 3b COVID-19 1 2 Total, in EUR bn 1 2 3a 3b 3c Gross exposure 160.
Slide 24: Limited Exposure to most affected Industries
Limited Exposure to most affected Industries 1.7% (EUR 1,726 mn) of non-retail exposure to customers rated1) substandard and below, in U-shaped and L-shaped industries ▪ 49% of which mature in the next 18 months ▪ Non-performing exposure Stage 3 coverage: 58% ▪ Stage 2 provision stock: EUR 80 mn 2 3
Slide 25: IFRS 9 Provisioning
IFRS 9 Provisioning Risk costs development EUR EUR 87 mn 185 mn Total risk costs of EUR 185 mn, of which EUR 110 mn related to non-retail, EUR 75 mn related to retail ▪ In GC&M, EUR 81 mn, mainly related to COVID-19 post-model adjustments and Stage 3 bookings ▪ In EE, EUR 38 mn mainly related to Rus
Slide 26: NPE Ratio and Coverage
NPE Ratio and Coverage Asset Quality Developments YTD Q3/2019 Q4/2019 Q1/2020 Q2/2020 Q3/2020 NPE Stock in EUR mn ▪ NPE ratio down to 1.9% driven by writebacks and Central Europe 63.3% 65.0% 6.0% recoveries (EUR 646 mn), write-offs (EUR 141 mn) and NPE 59.1% 58.6% 62.8% Q3/2020 ∆ QoQ sales (EUR 122
Slide 27: Appendix
01 02 03 Business & Financial Risk Update Appendix Update Group Investor Relations 12 November 2020 27
Slide 28: Geographic Footprint
Geographic Footprint ▪ Leading regional player with CEE presence of over Russia, #9 30 years servicing approx. 16.8 million customers Central Europe (CE) ▪ Loans: EUR 9.0 bn Southeastern Europe (SEE) ▪ Branches: 144 Eastern Europe (EE) ▪ Covering Austria and 13 CEE markets, of which six Ukraine, #5
Slide 29: Raiffeisen Banking Group Structure
Raiffeisen Banking Group Structure ▪ Raiffeisen Banking Group (RBG) – largest banking group in Austria with total assets of EUR 318 bn as of 30/06/2020 ▪ Solid funding profile of RBG based on a domestic market share of around 32% of total customer deposits, not least due to superior brand recognitio
Slide 30: Overview of Measures in CEE
Overview of Measures in CEE Country Moratorium Rescue package (% of GDP) Potential external support Czech 3 months or 6 months (31/10/2020) Opt-in Principal only, interest still due from 20.8% incl. 15.4% of indirect 3.7% of GDP in grants EU Recovery Republic businesses, but capitalized for measures
Slide 31: CEE Monetary Policy Response to Corona Crisis
CEE Monetary Policy Response to Corona Crisis Unconventional Conventional QE QE-LIKE Czech National Cum. 200bp rate cuts as crisis response; Legal foundations for QE laid, but CNB Higher frequency of repo Bank counter cyclical capital buffer cut to announced QE only to be used as emergency operation
Slide 32: Committed to Sustainable Finance
Committed to Sustainable Finance Five green bonds issued Certifications ▪ Green loan portfolio with total volume of eligible assets: EUR “C+” level and Prime status in ESG corporate 1,529 mn as of 31/09/2020 rating by ISS ESG (June 2019) ▪ The reference portfolio comprises green buildings (81%), eve
Slide 33: Corporate Center/Reconciliation
Corporate Center/Reconciliation In EUR mn 1-9/2020 1-9/2019 y-o-y In EUR mn 1-9/2020 1-9/2019 y-o-y Operating income 442 699 (36.8%) Operat ing income (506) (891) (43.2%) General admin. expenses (278) (266) 4.6% General admin. expenses 102 97 5.1% Operating result 164 433 (62.1%) Operat ing result (
Slide 34: Equity Overview
Equity Overview Cumulative other Subscribed Capital Retained comprehensive Consolidated Non-controlling Additional Total In EUR mn capital reserves earnings income equity interests tier 1 Equity Equity as at 1/1/2020 1,002 4,992 8,443 (2,620) 11,817 811 1,137 13,765 Capital increases 0 0 0 0 0 0 497
Slide 35: Regulatory Capital Overview
Regulatory Capital Overview Regulatory Capital Structure In EUR mn 30/9/2020 30/6/2020 31/12/2019 Common equity tier 1 (before deductions) 11,019 11,389 11,659 Deduction items (964) (749) (797) Common equity tier 1 (after deductions) 10,055 10,640 10,862 Additional tier 1 (after deductions) 1,723 1,
Slide 36: Maturity Profile
Maturity Profile Maturity Profile at 30/9/2020 (in EUR mn) 1,973 1,926 14 1,751 1,684 500 546 1,186 1,054 981 1,959 1,650 724 1,426 505 99 1,138 1,186 532 1,054 626 500 476 122 112 38 60 84 112 60 32 96 5 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 >2035 Senior placements Subordinated Add
Slide 37: AT1 and Subordinated Instruments
AT1 and Subordinated Instruments Regulatory Capital Initial Nominal Issuer ISIN Reset Coupon Issuance date First Call Date Call period Maturity Treatment1 Recognition2 Coupon outstanding Raiffeisen Bank 5Y EUR ms Semi- Additional Tier 1 99.6% XS1756703275 4.500% EUR 500 mn 17 Jan 2018 25 Jun 2025 Pe
Slide 38: Available Distributable Items (ADI) to Cover Discretionary Distributions
Available Distributable Items (ADI) to Cover Discretionary Distributions Distributable Items Available Distributable Items (EUR mn) ▪ Discretionary coupon payments on AT1 capital are subject to sufficient distributable items1 7,776 7,274 770 7,009 7,065 6,979 354 ▪ Distributable items based on RBI A
Slide 39: The Institutional Protection Scheme (IPS)
The Institutional Protection Scheme (IPS) 1 RBI is part of the Raiffeisen Banking Group federal IPS. The IPS supports members if needed to ensure solvency and liquidity 2 IPS serves as capital cushion and source of liquidity to its members. Uniform and joint monitoring ensures the early identificati
Slide 40: Bank Levies and Resolution Fund
Bank Levies and Resolution Fund Impact in EUR mn FY 2019 1-9/2020 FY 2020e Bank levy based on total assets (excluding derivatives) and including a one-off 1 Austria 57 55 ~58 payment (spread over 4 years) of EUR 163 mn from 2017 on Bank levy of 0.15% (for up to HUF 50 bn of total assets) and 0.21% (
Slide 41: NPE and NPL Distribution by Country
NPE and NPL Distribution by Country In EUR mn NPE Stock NPE Ratio NPE Ratio NPE Coverage Ratio NPE Coverage Ratio NPL Ratio NPL Ratio NPL Coverage Ratio NPL Coverage Ratio 30/9/2020 30/9/2020 31/12/2019 30/9/2020 31/12/2019 30/9/2020 31/12/2019 30/9/2020 31/12/2019 Czech Republic 207 1.2% 1.4% 59.9%
Slide 42: Country and Segment Overview
Country and Segment Overview 2 1-9/2020 Total Assets Share of Loan/deposit Net Interest Cost/income Provisioning Return on equity 2 (EUR mn) Total Assets Ratio Margin Ratio Ratio after tax Czech Republic 18,208 11.0% 81.1% 1.98% 56.8% 0.47% 7.5% Hungary 8,203 5.0% 69.9% 1.91% 57.7% 0.43% 6.7% Poland
Slide 43: RBI Group
RBI Group 3 3 In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 770 825 (6.6%) 881 881 866 2,476 2,531 (2.2%) 3,412 Net fee and commission income 433 392 10.5% 448 489 468 1,272 1,307 (2.7%) 1,797 Net trading income and fair value result 33
Slide 44: Country Financials (CE) – Czech Republic
Country Financials (CE) – Czech Republic In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 73 82 (10.9%) 101 96 104 256 299 (14.4%) 395 Net fee and commission income 29 26 12.7% 36 33 32 91 97 (6.7%) 130 Net trading income and fair value re
Slide 45: Country Financials (CE) – Hungary
Country Financials (CE) – Hungary In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 36 38 (4.2%) 37 22 34 111 105 5.5% 127 Net fee and commission income 34 32 8.3% 36 38 37 102 111 (8.1%) 149 Net trading income and fair value result (5) 3 –
Slide 46: Country Financials (CE) – Poland
Country Financials (CE) – Poland 3 3 In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 4 4 4.0% 4 3 4 12 11 9.6% 14 Net fee and commission income 1 1 37.5% 1 0 1 2 2 15.8% 2 Net trading income and fair value result 0 0 65.0% 0 0 0 1 1 (50.4
Slide 47: Country Financials (CE) – Slovakia
Country Financials (CE) – Slovakia 3 3 In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 72 73 (0.6%) 74 75 74 219 219 (0.3%) 294 Net fee and commission income 36 36 0.1% 35 41 40 108 119 (9.0%) 160 Net trading income and fair value result
Slide 48: Country Financials (SEE) – Albania
Country Financials (SEE) – Albania In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 13 13 3.7% 14 14 14 40 43 (6.5%) 57 Net fee and commission income 3 3 16.5% 3 4 4 10 12 (22.0%) 16 Net trading income and fair value result 1 (4) – 8 1 1 4
Slide 49: Country Financials (SEE) – Bosnia & Herzegovina
Country Financials (SEE) – Bosnia & Herzegovina In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 16 16 (0.2%) 16 17 17 48 51 (5.9%) 68 Net fee and commission income 11 9 19.9% 10 11 11 30 31 (3.8%) 42 Net trading income and fair value resu
Slide 50: Country Financials (SEE) – Bulgaria
Country Financials (SEE) – Bulgaria In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 28 28 0.1% 29 29 29 86 84 2.0% 114 Net fee and commission income 14 11 22.9% 13 13 15 37 42 (10.5%) 55 Net trading income and fair value result 0 1 (51.0%
Slide 51: Country Financials (SEE) – Croatia
Country Financials (SEE) – Croatia 3 3 In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 28 29 (4.2%) 30 31 31 87 91 (4.6%) 122 Net fee and commission income 18 12 42.2% 17 20 22 47 56 (15.4%) 75 Net trading income and fair value result 3 2
Slide 52: Country Financials (SEE) – Kosovo
Country Financials (SEE) – Kosovo In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 12 12 (0.4%) 12 11 11 35 33 7.9% 44 Net fee and commission income 3 2 40.6% 2 3 4 7 8 (14.6%) 10 Net trading income and fair value result 0 (0) – 0 0 (0) (0
Slide 53: Country Financials (SEE) – Romania
Country Financials (SEE) – Romania 3 3 In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 91 93 (2.0%) 96 96 96 279 278 0.5% 374 Net fee and commission income 41 35 14.8% 39 40 44 115 128 (10.5%) 168 Net trading income and fair value result
Slide 54: Country Financials (SEE) – Serbia
Country Financials (SEE) – Serbia In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 21 21 0.6% 21 22 22 64 66 (3.5%) 88 Net fee and commission income 12 10 18.5% 12 13 13 35 38 (7.2%) 51 Net trading income and fair value result 2 2 (21.3%)
Slide 55: Country Financials (EE) – Belarus
Country Financials (EE) – Belarus In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 18 22 (16.1%) 25 27 28 64 76 (15.8%) 103 Net fee and commission income 15 13 9.9% 15 15 16 43 42 2.1% 57 Net trading income and fair value result 4 (2) – 8
Slide 56: Country Financials (EE) – Russia
Country Financials (EE) – Russia In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 172 193 (10.9%) 207 218 205 571 571 0.1% 789 Net fee and commission income 88 84 4.4% 91 121 106 263 273 (3.6%) 394 Net trading income and fair value result
Slide 57: Country Financials (EE) – Ukraine
Country Financials (EE) – Ukraine In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 54 63 (14.5%) 67 68 65 185 182 1.3% 250 Net fee and commission income 23 20 14.0% 22 29 31 66 77 (15.0%) 106 Net trading income and fair value result 4 8 (4
Slide 58: Group Corporates & Markets
Group Corporates & Markets 3 3 In EUR mn Q3/2020 Q2/2020 q-o-q Q1/2020 Q4/2019 Q3/2019 1-9/2020 1-9/2019 y-o-y 1-12/2019 Net interest income 141 160 (12.0%) 151 143 160 452 455 (0.8%) 598 Net fee and commission income 100 96 4.4% 104 118 97 300 277 8.2% 394 Net trading income and fair value result 3
Slide 59: Sustainable Ratings and Industry Awards
Sustainable Ratings and Industry Awards The Banker – Bank of the Year 2019 in “C+” level and prime status ▪ Central & Eastern Europe in sustainability rating by ISS ESG ▪ Bulgaria (June 2020) ▪ Bosnia and Herzegovina ▪ Ukraine Global Finance 2020 – Best Bank in Overall ESG score 77 ▪ Central and Eas
Slide 60: Shareholder Information Overview
Shareholder Information Overview General Information Shareholder Structure1 ▪ Listed since 25 April 2005 on the Vienna Stock Exchange Prime Market ▪ Indices: ATX, ATX Prime, ATX five, MSCI Standard Index Europe, EURO STOXX Banks ▪ 328,939,621 ordinary shares issued Regional Raiffeisen Free float ban
Slide 61: Contact and Financial Calendar
Contact and Financial Calendar Contact Details Financial Calendar Group Investor Relations 29 January 2021 Start of Quiet Period1) Raiffeisen Bank International AG 05 February 2021 Preliminary Results 2020 17 March 2021 Annual Report 2020, Conference Call Am Stadtpark 9 1030 Vienna 12 April 2021 Rec
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