Komercni Banka, A.s. · PSECZ:KOMB
Komercni Banka, A.s — FY2011 Earnings Presentation
43 slides from Komercni Banka, A.s's earnings presentation, Feb 16, 2012
Slide 1: KB Group Unaudited Financial Results as at 31 December 2011
KB Group Unaudited Financial Results as at 31 December 2011 (International Financial Reporting Standards) Prague 16 February 2012
Slide 2: Disclaimer
Disclaimer This document contains a number of forward-looking statements relating to the targets and strategies of the Komerční banka Group. These statements are based on a series of assumptions, both general and specific. As a result, there is a risk that these projections will not be met. Readers
Slide 3: Agenda
Agenda Business Highlights Consolidated Financial Results Loan Portfolio Quality and Cost of Risk Appendix 3 KB 4Q 2011 results – Prague – 16 February 2012
Slide 4: External factors drag down the Czech economy
Czech economy External factors drag down the Czech economy Industrial production resilient in 2011 (+6.9% Real GDP development (%) YoY), average unemployment down by 0.4 p.p. (8.5%), both to be affected by declining orders in 2.9 2.6 1.7 0.1 1.3 2012* Government 2011 deficit 3.7%* of GDP below -4.5
Slide 5: Highlights of the year 2011
Highlights of the year 2011 Year on year comparisons Good business performance, solid capital and liquidity Number of bank clients increased by 12,000 to 1,602,000. KB Group attends to 2.6 million clients Consolidated deposits rose by 4.2% to CZK 560.7 billion Gross lending to clients up 12.7% to CZ
Slide 6: Business achievements Q4 2011 – Individuals
Business achievements and initiatives in the fourth quarter of 2011 – Individuals Year on year comparisons Improving client numbers & volume trends Number of individual clients of the bank grew by 1.2% to 1,336,000 Reinforcing position on the housing lending market. Outstanding volume of KB mortgage
Slide 7: Business achievements Q4 2011 – Businesses
Business achievements and initiatives in the fourth quarter of 2011 – Businesses Year on year comparisons Positive momentum in client flows Healthy growth of deposits from businesses by 5.0% to CZK 295.1 billion - of which bank deposits from small businesses increased by 6.0% to CZK 111.9 billion Ac
Slide 8: Group deposits
Group deposits CZK billion By Customers 546.8 551.1 560.7 535.3 538.1 536.1 70.9 Improved dynamics of deposit 69.0 69.0 69.2 70.4 69.7 growth 151.3 153.7 154.2 156.3 156.9 159.9 28.2 28.8 29.0 29.7 29.9 30.4 YoY group deposits increased by 4.2%, QoQ up by 1.7% 280.7 281.1 281.9 291.1 295.1 278.8 Vol
Slide 9: Group lending activities
Group lending activities CZK billion 450.5 Dynamic growth of lending 422.3 435.1 389.0 399.7 398.2 51.4 50.6 51.3 48.7 49.7 50.0 119.1 124.1 Gross loans rose 12.7% YoY, 3.5% QoQ 115.7 106.4 109.3 112.0 (adjusted for SGEF acquisition up by 10.0% YoY, 28.4 28.2 28.3 28.3 4.1% QoQ) 28.3 28.1 Business l
Slide 10: KB strategy: Priorities for 2012
KB strategy Priorities for 2012 Delivering upgraded direct channels and improvements in the branch network, development of advisory competences and tools in the distribution network with a common goal of reinforcing client satisfaction and loyalty Development of lending activities, with primary focu
Slide 11: Agenda
Agenda Business Highlights Consolidated Financial Results Loan Portfolio Quality and Cost of Risk Appendix 11 KB 4Q 2011 results – Prague – 16 February 2012
Slide 12: Consolidated financial results: Profit and Loss Statement
Consolidated financial results Change Change Profit and Loss Statement FY 2010 FY 2011 FY 2011 YoY YoY (CZK million, unaudited) Pro forma Pro forma Net interest income 21,431 22,190 21,848 3.5% 1.9% Net fees & commissions 7,725 7,305 7,286 -5.4% -5.7% Income from financial operations 3,135 3,157 3,1
Slide 13: Recurring financial results
Recurring financial results Change Change Recurring P&L FY 2010 FY 2010 FY 2011 FY 2011 YoY YoY (CZK million, unaudited) Reported Recurring Reported Recurring Reported Recurring Net interest income 21,431 21,330 22,190 21,803 3.5% 2.2% Net fees & commissions 7,725 7,725 7,305 7,446 -5.4% -3.6% Incom
Slide 14: Consolidated financial results: Balance Sheet
Consolidated financial results 31 Dec 31 Dec 31 Dec Change Change Balance Sheet 2010 2011 2011 YtD YtD (CZK million, unaudited) Pro forma Pro forma Assets 698,014 754,810 744,188 8.1% 6.6% Cash and balances with central bank 13,689 16,980 16,980 24.0% 24.0% Amounts due from banks 112,179 101,393 100
Slide 15: Consolidated financial ratios
Consolidated financial ratios 31 Dec 30 Sep 31 Dec 31 Dec Change Change Key ratios and indicators 2010 2011 2011 2011 YoY YoY (year-to-date) Pro forma Pro forma Capital adequacy 15.3% 16.0% 14.6% 15.1% Tier 1 ratio 14.0% 14.7% 13.4% 13.8% Total capital requirement (CZK billion) 27.5 28.4 30.4 29.0 1
Slide 16: Maintaining safe capital base
Proposed distribution of 2011 profit Maintaining safe capital base Capital adequacy development analysis (Total CAD, CNB methodology, Basel II) Board of Directors proposal is subject to approval -70 bps by KB‘s Supervisory Board and by the Annual -20 bps -50 bps General Meeting of the bank -158 bps
Slide 17: Shareholders' equity
Shareholders‘ equity Development year-to-date Total shareholders‘ equity Total shareholders‘ equity +5,772 as at 31 December 2010 as at 31 December 2011 Shareholders' equity 31/12/2010 1/1/2011 Increase Decrease 31/12/2011 Share capital 19,005 19,005 19,005 Capital and reserve funds 36,173 49,503 -1
Slide 18: Net interest income
Net interest income Growth in interest income driven by business volumes 5,569 5,579 5,671 5,273 5,449 5,372 431 559 495 527 NII in FY 2011 up by 3.5% YoY (+1.9% adjusted for 450 498 SGEF acquisition). 4Q up 1.6% QoQ 2,122 2,198 2,278 2,296 2,021 2,078 NII at subsidiaries – ESSOX +6%, Modrá pyramida
Slide 19: Net fees and commissions
Net fees and commissions Income impacted by decreasing prices and higher commissions paid 2,028 1,931 1,866 1,882 Fee income in FY 2011 down 5.4% YoY (-5.7% 1,837 167 211 1,720 adjusted for SGEF acquisition). 4Q down 6.4% QoQ 193 160 183 400 367 177 416 396 386 200 Maintenance fees – lower income af
Slide 20: Net profit from financial operations
Net profit from financial operations Improved results in the second half 957 864 804 816 Net profit from financial operations in FY 2011 713 672 400 increased by 0.7% YoY (-1.1% adjusted for SGEF 488 434 424 acquisition). 4Q result up 17.3% QoQ 394 344 Penzijní fond KB realised gains totalling CZK 1
Slide 21: Operating costs
Operating costs Temporarily faster pace of costs development in 2011 3Q 2010 4Q 2010 1Q 2011 2Q 2011 3Q 2011 4Q 2011 OPEX in FY 2011 rose by 6.5% YoY (5.4% adjusted for SGEF acquisition). OPEX in 4Q up 12.3% QoQ. Comparative base of 2010 affected by positive one- -1,491 -1,613 -1,605 -1,653 -1,682 -
Slide 22: Agenda
Agenda Business Highlights Consolidated Financial Results Loan Portfolio Quality and Cost of Risk Appendix 22 KB 4Q 2011 results – Prague – 16 February 2012
Slide 23: Loan quality
Loan quality Improving loan portfolio quality Gross lending CZK billion 435.1 450.5 Loan exposure +12.7% YoY (incl. SGEF 422.3 389.0 399.7 398.2 acquisition), +3.5% QoQ driven by organic growth mainly thanks to corporate loans and 394.7 410.2 mortgages to individuals 349.2 360.9 359.4 381.1 Share of
Slide 24: Cost of risk
Cost of risk Cost of risk negatively affected by Greek government bonds impairment 3Q 2010 4Q 2010 1Q 2011 2Q 2011 3Q 2011 4Q 2011 133 181 175 2011 cost of risk at CZK 7.3 billion compared 83 80 55 52 43 63 to CZK 3.1 billion in 2010 66 72 55 49 24 48 0 84 35 10 -253 14 -492 -200 4Q non-commercial c
Slide 25: Commercial cost of risk - Corporates
Commercial cost of risk - Corporates Zoom on corporate client segments KB Group – Corporate Segments 3Q 2010 4Q 2010 1Q 2011 2Q 2011 3Q 2011 4Q 2011 82 150 80 57 42 100 26 29 50 2011 cost of risk down to 29 bps compared 40 0 -50 -100 -123 -150 to 80 bps in 2010 -250 -273 -203 -200 -344 -250 -300 -35
Slide 26: Commercial cost of risk - Retail
Commercial cost of risk - Retail KB Group – Retail Segments Zoom on retail client segments 3Q 2010 4Q 2010 1Q 2011 2Q 2011 3Q 2011 4Q 2011 250 175 168 166 171 151 135 2011 cost of risk down at 85 bps from 94 bps 97 94 98 93 87 150 85 in 2010 85 83 88 82 78 78 50 -50 Stable QoQ overall retail cost of
Slide 27: Agenda
Agenda Business Highlights Consolidated Financial Results Loan Portfolio Quality and Cost of Risk Appendix 27 KB 4Q 2011 results – Prague – 16 February 2012
Slide 28: Number of clients and distribution network
Number of clients and distribution network Evolution of clients‘ portfolio and networks Number of bank clients (CZ) KB Group‘s 2.6 million clients, of which KB bank 1,602,000 clients (+1%) MPSS 649,000 clients (-6%) PFKB 508,000 clients (+1%) 1,577 1,629 1,620 1,590 1,602 1,515 ESSOX 288,000 active
Slide 29: Consolidated financial results: Profit and Loss Statement (4Q)
Consolidated financial results Change Change Profit and Loss Statement 4Q 2010 3Q 2011 4Q 2011 4Q 2011 YoY YoY (CZK million, unaudited) Pro forma Pro forma Net interest income 5,449 5,579 5,671 5,574 4.1% 2.3% Net fees & commissions 2,028 1,837 1,720 1,710 -15.2% -15.7% Income from financial operati
Slide 30: KB consolidated group
KB consolidated group Pension Penzijní fond KB #4 pension fund in the Czech Republic with 508,000 clients insurance (100%) Modrá pyramida Building Second largest building society according to loan volume with 649,000 clients stavební society and 1,298 strong agent distribution network spořitelna (10
Slide 31: Business performance of subsidiaries 1/2
Business performance of subsidiaries 1/2 FY 2010 FY 2011 Change YoY MPSS Volume of new loans (CZK million) 9,025 7,785 -14% Volume of total loans (gross, CZK million) 49,700 51,369 3% Target volume of new contracts (CZK million) 33,208 25,008 -25% Volume of deposits (CZK million) 69,019 70,857 3% Av
Slide 32: Business performance of subsidiaries 2/2
Business performance of subsidiaries 2/2 FY 2010 FY 2011 Change YoY Factoring Factoring turnover (CZK million) 12,035 16,096 34% KB Volume of total financing (gross, CZK million) 1,924 2,832 47% Average number of FTEs 38 38 0% KP Newly concluded policies (number) 482,435 823,480 71% of which in life
Slide 33: Standalone results of KB group companies and associated undertakings
Standalone results of KB group companies and associated undertakings Account. Share of Net YoY Equity YoY Assets YoY standards KB Profit CZK million KB IFRS 100% 7,951 n.a. 72,468 n.a. 660,279 n.a. - o/w KB branch in Slovakia IFRS 100% 55 n.a. -20 n.a. 10,582 n.a. ESSOX, s.r.o. IFRS 51% 288 76.7% 2,
Slide 34: Securities portfolio in the banking book
Securities Securities portfolio in the banking book CZK billion Available-for-sale portfolio Held-to-maturity portfolio 78.5 78.5 CZK 125.3 billion CZK 3.4 billion 3.2 0.2 25.6 25.6 1.6 1.6 3.1 3.1 16.4 16.4 Czech sovereign Foreign sovereign Czech sovereign Foreign sovereign Czech financial institut
Slide 35: Foreign sovereign bond holdings by country and portfolio
Foreign sovereign exposure Foreign sovereign bond holdings by country and portfolio CZK billion 25.6 Portugal, 0.2 Greece, 2.1 EIB, 2.4 Slovakia, 5.3 Italy, 7.3 2.0 Slovakia, 0.7 Poland, 8.3 Poland, 1.3 0.2 France, 0.2 1) Trading book Available-for-sale 1) Held-to-maturity 2) Measurement at [1] fair
Slide 36: Revaluation of MPSS balance sheet
Revaluation of MPSS balance sheet Background ► Remaining 60% in Modrá pyramida acquired in October 2006. Full consolidation of MPSS since 4Q 2006 ► Preliminary goodwill on acquisition of Modrá pyramida at CZK 2,741 mil. ► In accordance with IFRS 3 A&L valuation to be completed within 12 months after
Slide 37: Acquisition of SGEF – fair value assessment
Acquisition of SGEF – fair value assessment of assets and liabilities Background ► KB acquired on 4 May 50.1% stake in SG Equipment Finance Czech Republic, s.r.o. (SGEF) for a purchase price of CZK 1,800 million. SGEF has been consolidated in KB Group accounts using full consolidation method since M
Slide 38: Czech Republic macroeconomic environment
Macroeconomic environment Czech Republic Macroeconomic Indicators 2008 2009 2010 2011* 2012* 2013* Real GDP (%, average) 2.9 -4.5 2.6 1.7 0.1 1.3 Inflation (%, average) 6.3 1.0 1.5 1.9 2.9 1.6 Household consumption (%, average) 3.0 -0.4 0.5 -0.5 -0.9 1.2 Unemployment (%, av., MLSA meth.) 5.5 8.0 9.0
Slide 39: Interest rates evolution
Interest rates evolution (for the period 28 December 2001 – 31 January 2012) 5.5% 5.0% 4.5% 4.0% 3.5% 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% 01/01/2005 01/01/2006 01/01/2007 01/01/2008 01/01/2009 01/01/2010 01/01/2011 01/01/2012 Pribor 3M Pribor 6M ČNB REPO Rate IRS 5Y IRS 10Y 39 KB 4Q 2011 results – Pr
Slide 40: Development of KB's share price and PX Index
Development of KB‘s share price and PX Index (for the period 1 October 2001 – 31 January 2012) 4,800 2,100 4,300 1,900 1,700 3,800 1,500 3,300 1,300 2,800 1,100 2,300 900 1,800 700 1,300 500 800 300 01/10/01 01/10/02 01/10/03 01/10/04 01/10/05 01/10/06 01/10/07 01/10/08 01/10/09 01/10/10 01/10/11 KB
Slide 41: Notes to recurring profit
Notes to recurring profit Overview of items excluded in order to calculate recurring profit FY 2011 (impact net of tax, KB Group share): amortisation of MPSS acquisition revaluation (CZK 41 mil.) impairment of Greek government bonds (CZK -4,338 mil.) SGEF acquisition (CZK 102 mil.) sale of bonds in
Slide 42: KB shareholders
KB shareholders As at 31 December 2011 Shares on registered capital according to excerpt from the Securities centre Others 39.6% Société Générale 60.4% As at 31 December 2011, KB held 238,672 own shares in treasury, representing 0.63% stake on registered capital. 42 KB 4Q 2011 results – Prague – 16
Slide 43: Investor Relations
Investor Relations Jakub Černý, Georgina Olegrová, Robert Janeček Tel.: +420 955 532 156, 955 532 734, 955 532 155 E-mail: investor_relations@kb.cz - Internet: www.kb.cz 43 KB 4Q 2011 results – Prague – 16 February 2012