Kempen European High Dividend Fund N.V. N · EURONEXT:KEHDF
Kempen European High Dividend Fund N.V. N — Van Lanschot Kempen — H1 2017 Earnings Presentation
22 slides from Kempen European High Dividend Fund N.V. N's earnings presentation, Aug 29, 2017
Slide 1: 2017 half-year results
2017 half-year results 29 August 2017
Slide 2: Good progress on Strategy 2020
Good progress on Strategy 2020 Next steps in Increased client Significant growth in Net AuM inflow omnichannel private interaction and fiduciary services banking model retention Dutch private banking activities of Outsourcing non-core Bolt-on acquisition Strong track record for Bolt-on acquisitions
Slide 3: Robust performance and proposal to return capital
Robust performance and proposal to return capital Net result rises to €62.3m Client assets €72.0bn (+4%) (H1 2016: €31.5m) Assets under management Underlying net result rises to €69.6m €60.1bn (+4%) (H1 2016: €37.7m) Capital ratios continue to improve Proposal to return €1 per share to shareholders
Slide 4: Highlights H1 2017
Highlights H1 2017 Net result rises by 98% to €62.3m (H1 2016: €31.5m) Strong increase • Underlying net result rises to €69.6m (H1 2016: €37.7m) in underlying • Commission income increases 13% to €132.3m (H1 2016: €117.4m) • Income from securities and associates rises to €29.7m (H1 2016: €8.5m) net
Slide 5: Strong increase in net result to €62.3m (H1 2016: €31.5m)
Strong increase in net result to €62.3m (H1 2016: €31.5m) €m H1 2017 H1 2016 % c hange Commission income 132.3 117.4 13% Interest income 103.6 110.3 -6% Other income 36.9 12.5 194% Income fr om op er ating activities 272.7 240.2 14% Operating expenses -196.8 -194.8 1% Gr oss r esult 76.0 45.4 67% Lo
Slide 6: Net profit up significantly to €62.3m
Net profit up significantly to €62.3m 6
Slide 7: Underlying net result advances to €69.6m
Underlying net result advances to €69.6m €m Total Private Banking Evi Asset Management Merchant Banking Other (incl. Corporate Banking) 36.0 69.6 20.5 17.7 37.7 5.5 5.8 2.1 7.0 3.4 -4.4 -4.4 H1 2016 H1 2017 H1 2016 H1 2017 H1 2016 H1 2017 H1 2016 H1 2017 H1 2016 H1 2017 H1 2016 H1 2017 7
Slide 8: Increase in commission income is a further sign of our successful wealth management strategy
Increase in commission income is a further sign of our successful wealth management strategy • Transaction-related activities of Private Banking clients increase by more than 70% • At Asset Management, new mandates and market performance lead to growth 8
Slide 9: Stable interest margin
Stable interest margin • Lower interest income is mainly due to a smaller loan portfolio • Clean interest margin remains stable at 1.30% in H1 2017 compared with end of 2016 • Reduction in savings of c. €300m due to active balance sheet management * The clean interest margin equals the gross interes
Slide 10: Increasing Income from securities and associates
Increasing Income from securities and associates • Income from securities and associates relates to investments of Van Lanschot Participaties and stakes in own investment funds • At the beginning of 2017 a significant capital gain was realised on the sale of our minority stake in TechAccess (€11.1m)
Slide 11: Result on financial transactions up due to more favourable markets
Result on financial transactions up due to more favourable markets Results from: Consists of: • Brokerage activity • Realised gains on AFS-portfolio • Currency trading • Results on mark-to-market • Interest rate hedges portfolio • Medium-term notes 11
Slide 12: Operating expenses fairly stable
Operating expenses fairly stable • A smaller part of the costs of Staalbankiers is non-recurring as it is related to the transition • The €4.5m costs for KCM London were non-recurring • Total regulatory levies in H1 2017 amount €7.5m 12
Slide 13: Further progress on our Private Banking wealth management strategy
Further progress on our Private Banking wealth management strategy • Assets under management increase to €19.6bn (+4%), with net inflow at €0.3bn • Commission income rises to €61.1m (H1 2016: €50.7m) driven by the acquired Staalbankiers’ private banking activities, higher transaction-related activit
Slide 14: Evi aims to stand out for excellent service and continues to show AuM growth
Evi aims to stand out for excellent service and continues to show AuM growth • Evi shows a shift from savings to assets under management • Total client assets stable at €1.5bn • Outflow of savings in Belgium in line with funding strategy • Commission income increases to €2.0m (H1 2016: €1.7m) • Unde
Slide 15: AuM growth at Asset Management continues
AuM growth at Asset Management continues • Assets under management rise to €39.5bn (+5%) mainly driven by new mandates • Commission income increases to €44.9m (H1 2016: €43.4m); slight fee pressure visible • Underlying net result increases to €5.8m (H1 2016: €5.5m) • Several new mandates will take e
Slide 16: High activity in all Merchant Banking niches
High activity in all Merchant Banking niches • Commission income rises to €22.3m (H1 2016: €19.3m) • Underlying net result at €3.4m (H1 2016: €2.1m) • Promising pipeline for H2 2017 • Positive momentum for Structured Products, mainly due to low interest rate environment • Implementation of Mifid II
Slide 17: Mortgage book stable, run-off of Corporate Banking continues
Mortgage book stable, run-off of Corporate Banking continues €m 30-06-2017 31-12-2016 % change Impaired Provision Impaired Coverage loans ratio ratio Mortgages 5,740 5,718 0% 77 21 1.3% 28% Other loans 2,223 2,200 1% 152 81 6.9% 53% Private Banking 7,962 7,917 1% 229 102 2.9% 45% Loans to SMEs 577 6
Slide 18: Net release of loan loss provisions
Net release of loan loss provisions LLP/RWA* + 74 bps Additions to loan loss provision 2015 2016 H1 2017 Private Banking 22.1 1.2 0.8 Corporate Banking 23.9 0.0 -3.0 - 11 bps - 7 bps Other 5.0 -8.1 0.2 Total 51.0 -6.9 -1.9 * Average total RWA 18
Slide 19: Strong capital position supports a capital return to our shareholders
Strong capital position supports a capital return to our shareholders • Proposed return of capital of €1 per share represents the next step in the implementation of our capital strategy: our aim to return at least €250 million to shareholders in the period up to and including 2020, subject to the ap
Slide 20: Overview of group targets
Overview of group targets Common Equity Tier I ratio Dividend pay-out ratio** % % 50-70% 15-17% 19.0% 19.6% 64% 16.3% 37% 36% 13.1% 14.6% 0% 28% 11.0% 2012 2013 2014 2015 2016 H1 2020 2012 2013 2014 2015 2016 As from 2017* 2016 Efficiency ratio Return on Common Equity Tier I** % % 10-12% 60-65% 12.5
Slide 21: Robust performance and proposal to return capital
Robust performance and proposal to return capital Net result rises to €62.3m Client assets €72.0bn (+4%) (H1 2016: €31.5m) Assets under management Underlying net result rises to €69.6m €60.1bn (+4%) (H1 2016: €37.7m) Capital ratios continue to improve Proposal to return €1 per share to shareholders
Slide 22: Disclaimer
Disclaimer Disclaimer and cautionary note on forward-looking statements This document may contain forward-looking statements on future events and developments. These forward-looking statements are based on the current insights, information and assumptions of Van Lanschot Kempen’s management about kn