Banco De Credito E Inversiones · BCS:BCI
Banco De Credito E Inversiones — Q2 2023 Earnings Presentation
36 slides from Banco De Credito E Inversiones's earnings presentation, August 2023
Slide 1: Corporate Presentation 2Q 2023
Corporate Presentation 2Q 2023 Investor Relations Department | Email: Investor_Relations_Bci@Bci.cl August 2023
Slide 2: Bci at a glance
Bci at a glance | AA
Slide 3: Leading financial institution in Chile by Assets and Loans
Leading financial institution in Chile by Assets and Loans Profitable and financially sound Diversified business model Bci/Subsidiary Diversification as of June 2023 • Largest bank in Chile (total loans) US$95.98 bn US$59.08 bn • 3rd Largest Florida-based bank (-0.75% YoY) (+2.0% YoY) Total assets T
Slide 4: Chilean financial system
Chilean financial system | AA
Slide 5: Bci is part of a robust financial system
Bci is part of a robust financial system CHILE. Quarterly GDP growth and forecast (%, YoY) Total loans in the banking system2 (US$bn) Source: CMF Note: Figures are converted to US$ using an FX of USD/CLP of 801.66 (July 3rd 2023) 1 Figures exclude CNB (City National Bank) and Itau Corpbanca operatio
Slide 6: Bci Consolidated
Bci Consolidated | AA
Slide 7: A successful strategy supported by its strong corporate governance
A successful strategy supported by its strong corporate governance Long-term support from its controlling shareholders… …and strong corporate governance Private pension Board of Directors is composed by experts in various fields, academics, funds economists, bankers and individuals connected with th
Slide 8: Bci maintains a relevant position in the market
Bci maintains a relevant position in the market Chilean banking system benchmark In US$mm, as of June 2023 Loan breakdown1 Assets1 Other Other banks banks (12) (12) 14.6% 17.2% 14.9% 16.1% 14.2% 9.8% 13.2% 15.3% 18.8% 15.7% 14.9% 12.4% 9.5% 13.5% Commercial Consumer Mortgage Deposits1 Net income Con
Slide 9: Loan growth evolution
Loan growth evolution Total loans (US$mm) Commercial & Interbank loans (US$mm) CAGR CAGR Consumer lending loans (US$mm) CNB Mortgage loans (US$mm) CAGR CAGR Source: Financial Market Commission (CMF). 10 Note: Figures are converted to US$ using an FX of USD/CLP of 801.66 (July 3rd 2023); Include Corp
Slide 10: Successful organic growth in Chile…
Successful organic growth in Chile… Local loans market share2 (%) Return on average Equity (ROAE)1 as of June 2023 Chile 27.06% 22.78% 15.69% 14.98% 14.01% 12.22% +49bps of market share Return on average assets (ROAA)1 as of June 2023 2.35% 1.15% 0.96% 1.00% 1.00% 0.81% Source: CMF as of June 2023 1
Slide 11: …with diversified and low funding cost
…with diversified and low funding cost In terms of maturity, currency and geography Funding Sources Breakdown by type1 Long term funding composed primarily of UF local bonds in the Chilean market, complemented by other international issuances, through our EMTN program in US dollars, Euros, Swiss Fra
Slide 12: Risk Evolution
Risk Evolution Highlights Loan loss provisions / Average Gross Loans Bci's asset quality is supported by proactive risk management and monitoring. We have a stock of over US$ 511 Million in additional provisions. Our loan portfolio is well diversified by business lines, economic sectors, and custome
Slide 13: Evolution of NPL's
Evolution of NPL's NPL Ratio (NPLs/Total Loans)* NPL Ratio (Commercial Loans) NPL Ratio (Consumer Loans) NPL Ratio (Mortgage Loans) NPLs Consumer Loans excluding Financial Services 14 Note: Includes Bci subsidiary in USA (CNB) *Does not include Interbank loans
Slide 14: Financial Services: NPL's
Financial Services: NPL's 14 Figures are converted to US$ using an FX of 801.66 (July 3rd 2023)
Slide 15: Operating Expenses
Operating Expenses Operating Expense (YTD) Expense Breakdown US$ million as of June 2023 Efficiency Ratio* * Efficiency ratio as calculated by the CMF (operating expenses excluding other operating expenses/gross operating result). Since 1Q18. 16 Note: Figures are converted to USD using an FX of 801.
Slide 16: …developing the biggest platform in Chile, reaching out to an audience of +10MM Clients by 2026
…developing the biggest platform in Chile, reaching out to an audience of +10MM Clients by 2026 5,8 MM Gas Station Supermarket Jan 2023 1,1 MM Telco 1,1 MM +10 MM 4 MM 2026 16
Slide 17: 3,8 million customers already have a free MACH account
3,8 million customers already have a free MACH account and 30% are active users who make monthly value transactions 3,8 million Registered clients +80k Checking Account opting for a free account +310k clients have already paid with P2M in 2023 +1 million active clients making value transactions ~28k
Slide 18: ~700k clients have already enrolled in BciPlus+
~700k clients have already enrolled in BciPlus+ Individuals Merchants ~700k Enrolled clients in +200 merchants being part the loyalty program BciPlus+ of the program ~83k Clients have used ~75% active merchants in BciPlus+ since its launch. (to June. Jun'23) 55% growth in active clients Q2 * Informa
Slide 19: Main objectives of the proposed capital increase
Main objectives of the proposed capital increase “Support our local and international growth strategy, that has positioned Bci among the top 10 largest banks in Latin America in terms of assets, and strengthen the Company’s financial position to comply with the latest required regulatory capital rat
Slide 20: Since 2015, Bci has almost triplicated its consolidated assets
Since 2015, Bci has almost triplicated its consolidated assets Total Assets in Ch$ Billion 9.0% CAGR ’15 – ‘22 Local System Excl. Bci Bci Cons. (Inc. M&A)(1) 15.2% CAGR ’15 – ‘22 2.7x % of Local System’s Consolidated Assets 14% 15% 15% 17% 17% 18% 19% 20% Net Income 330,823 340,165 371,425 395,847 4
Slide 21: The intended capital increase is fundamental to position Bci above Basel III ratios
The intended capital increase is fundamental to position Bci above the capital ratios imposed by Basel III Basel III implementation - Projected scenarios for Bci: +4.64% +1.80% Estimated Impact of Capital Increase 11.00 % 9.75% Internal • Bci’s capital management policies CET1 Internal Counter-cycli
Slide 22: Balance sheet
Balance sheet CAGR US$ million (*) 2019 2020 2021* 2022* 2Q 2022* 2Q 2023* %D 2019-2022 Cash 3,934 5,735 4,628 5,309 10.51% 5,229 4,665 -10.79% Securities 7,772 11,434 21,580 24,882 47.38% 25,591 23,544 -8.00% Loans 42,000 43,753 49,073 58,649 11.77% 57,917 59,080 2.01% Other Financial Instruments 1
Slide 23: Financial results
Financial results CAGR US$ million (*) 2019 2020 2021* 2022* 2Q 2022* 2Q 2023* %D 2018-2022 Net Interest Income 1,648 1,819 1,993 2,881 20.46% 825.1 642.8 -22.10% Net Service Fee Income 439 419 432 458 1.42% 112.5 105.7 -6.03% Other Operating Income 273 297 271 28 -53.16% -70.7 46.4 -165.5% Operatin
Slide 24: City National Bank of Florida
City National Bank of Florida
Slide 25: We strengthened our liquidity position during the first half of 2023
We strengthened our liquidity position during the first half of 2023, increased our capital ratios & our CRE portfolio is well managed Client Deposits Liquidity Insured Deposits Capital Investments CRE We generated We maintained We reduced our Our CET 1 ratio 98% of our Our commercial client deposit
Slide 26: Our client deposits have grown $387MM (+2%) YTD
Despite turmoil and deposits shrinking in the banking system, our client deposits have grown $387MM (+2%) YTD Client Deposits ($MM) – Excludes Brokered Deposits +$387 (+2%) $17,669 $18,056 Dec 31st, 2022 June 30th, 2023 26
Slide 27: CNB total deposits have increased $1.7B (+9%) YTD
CNB total deposits have increased $1.7B (+9%) YTD while overall industry deposits have decreased Total Deposits ($MM) Banking Industry - Total Deposits ($B) QoQ change: -$87MM -0.4% QoQ change: +$48B +0.3% +$1,741 (+9%) ($383) $22,081 $21,994 (-2%) $20,253 $17,726 $3,550 $3,939 $17,295 $17,343 Broke
Slide 28: We leveraged ICS to increase our insured & collateralized deposits
We leveraged ICS to increase our insured & collateralized deposits from 49% at 2022 year-end to 65% as of June 30th, thereby reducing our uninsured and uncollateralized deposits to 35% ICS remaining capacity of ~$6B Deposits breakdown ($MM) (total capacity of $10B) Dec 31st, 2022 Mar 31st, 2023 June
Slide 29: Mark-to-market has improved $52MM since December
Mark-to-market has improved $52MM (pre-tax) since December & the duration of our investment portfolio has shortened as well Dec 31st, 2022 Mar 31st, 2023 June 30th, 2023 $MM Book value Fair value Unrealized G/L Book value Fair value Unrealized G/L Book value Fair value Unrealized G/L OCI Available-f
Slide 30: Our core loans grew moderately while maintaining strong asset quality
Our core loans grew moderately by $428MM QoQ and $836MM YTD while maintaining strong asset quality Total Assets ($MM) Total Loans & Leases ($MM) QoQ change: +$107MM +0.4% Core loans QoQ change: +$428MM +2.5% Non-owner +$1,094 occupied CRE represents (+4%) 47% of total $17,330 portfolio $26,204 $26,3
Slide 31: CRE loans are well diversified across various property types
CRE loans are well diversified across various property types with low LTVs, strong DSC and excellent asset quality CRE by Property Type % % Commitment % Balance % % OF Wavg LTV Wavg Accr Non- % Property Type ($M) Total ($M) Total RBC % DSCR % 30+ DPD Accrual in Florida Retail 2,316 23.9% 2,222 27.2%
Slide 32: Operating income through the first semester of 2023 was 9.7% lower than 2022
Operating income through the first semester of 2023 was 9.7% lower than 2022 $ Var % Var YTD YTD $ Var % Var INCOME STATEMENT ($ millions) 2Q'22 1Q'23 2Q'23 QoQ QoQ 2022 2023 YoY YoY (+) Net Interest Income $160.8 $144.8 $127.6 -$17.1 -11.8% $304.0 $272.4 -$31.6 -10.4% (+) Non-Interest Income $25.4
Slide 33: Net interest income in Q2'23 decreased $16.5MM vs prior quarter
Net interest income in Q2’23, excluding PPP & MSLP, decreased $16.5MM (-11.5%) vs prior quarter Net interest income ($k) Net interest margin (%) $158,557 2.70 $1,083 $144,753 0.01 2.43 PPP & MSLP Fees PPP/MSLP Impact $1,164 $127,622 0.03 $561 2.07 0.03 Net interest income Core NIM $157,474 2.69 (ex.
Slide 34: Liquidity and capital ratios are strong and have improved
Liquidity and capital ratios are strong and have improved across the board since 2022-year end and prior quarter Liquidity and Capital ratios Actual Ratio Var Dec 31st, 2022 March 31st, 2023 June 30th, 2023 th (June 30 vs st Dec 31 ) TCE Ratio (excl. HTM) 7.57% 7.72% 7.90% 0.33% TCE Ratio (incl. HTM
Slide 35: Conclusions and outlook
Conclusions and outlook While deposits in the industry shrank and others migrated from regional/community banks to the largest US banks, our client deposits grew $387MM as of June (4% annualized growth rate) Our already strong liquidity and capital position improved across the board in the first
Slide 36: Forward-looking statements disclaimer
This presentation contains forward-looking statements in various places throughout therein, related to, without limitation, our future business development. Forward-looking information is often, but not always, identified by the use of words such as “anticipate”, “believe”, “expect”, “plan”, “intend
Banco de Crédito e Inversiones (Bci) — Q2 2023 Earnings Presentation on 6ix