Eurobank S.A. · ATHEX:EUROB

Eurobank — EFG Eurobank Ergasias — H1 2003 Earnings Presentation

27 slides from Eurobank's earnings presentation, 2003

  1. Slide 1: First Half 2003 Results

    FIRST HALF 2003 RESULTS Nicholas Nanopoulos, CEO Paula Hadjisotiriou, CFO 1

  2. Slide 2: Cautionary Statement Regarding Forward-Looking Information

    Cautionary Statement Regarding Forward-Looking Information This presentation may contain projections or other forward – looking statements related to EFG Eurobank Ergasias S.A. that involve risks and uncertainties. Readers are cautioned that these statements represent the Group’s judgments and futur

  3. Slide 3: Business environment: Lending growth continues

    Business environment: Lending growth continues Household Lending ƒ Business & consumer 36,000 Jan–May 2003 confidence improves + 29.6% 34,000 Y-o-Y ƒ Private sector credit expansion 32,000 picks-up in May to 18.6% 30,000 – Household lending growth at 29.6% Jan Feb Mar Apr May – Non-household lending

  4. Slide 4: Business environment: Equity market recovers

    Business environment: Equity market recovers ASE Turnover ƒ ASE avg. daily Turnover jumps to 150 € 140m in 2Q from a low of € 68m in 1Q 130 ƒ Equity prices recover from March lows, in line with major markets 110 ƒ Privatisation programme gains 90 momentum 70 ƒ Equity funds at only 13% of total 50 ƒ

  5. Slide 5: Key Business Developments

    Key Business Developments ƒ Reorganisation of the Bank along market segments is now complete – Positive effects of restructuring are now becoming evident ƒ Bank-wide Credit Process Reengineering ƒ Strengthening our cooperation with Inchcape ƒ Ergoinvest and Investment Development fund acquisitions –

  6. Slide 6: Expanding our position

    Expanding our position ƒ Gaining market share in household and small business lending Market Share in Household Lending ƒ Launching new customised retail products 16% – Mortgages linked to ECB refi rate; 15.9% new Flexi-loan 15.8% – Consumer Finance: Open Line 15.4% ƒ Rapidly expanding our presence

  7. Slide 7: Well positioned for stock market recovery

    Well positioned for stock market recovery ƒ Market share in Mutual Funds: from 16% (Dec. 02) to 19.8% (excl. money market) ƒ Market share in Equity Brokerage: from 13% at end-2002 to 14.7% in 1H03 ƒ Consolidating our leading position in Institutional Asset Management ƒ Leaders in Equity Offerings, D

  8. Slide 8: 1H 2003 Financial Highlights

    1H 2003 Financial Highlights ƒ Loan growth at 21.8% with healthy NIM ƒ Robust 16.5% top line growth ƒ Recovery of Fee Income, reversing previous negative trend ƒ Cost to Income ratio down to 59.3% (57.4% in Greece) ƒ Core Profit in Greece at record levels of € 74m on a quarterly basis, up 7% Q-o-Q ƒ

  9. Slide 9: Financial Review

    EFG @ Eurobank Ergasias FINANCIAL REVIEW

  10. Slide 10: Loan growth picks-up to 21.8%, loan book expands by a record €936m in 2Q

    Loan growth picks-up to 21.8%, loan book expands by a record € 936 m in 2Q Loans outstanding New Loans by Quarter (excl. Settlement Balances) + 21.8% In € m In € m 15,000 14,513 incl. Balkans 1000 14,000 13,000 11,919 800 182 12,000 600 11,000 936 10,000 400 716 9,000 547 562 200 430 8,000 263 7,000

  11. Slide 11: Households still the driving force, business lending picks up

    Households still the driving force, business lending picks up ƒ Household lending up 30%: Consumer finance +32% & Mortgage lending +27% ƒ Non-household lending grows by 17% ƒ Household lending at 38% of total loans Household Lending Non - Household Lending* + 30% In € m In € m + 17% 6,000 5,672 10,0

  12. Slide 12: Customer Funds up 7% - driven by Mutual Funds

    Customer Funds up 7% - driven by Mutual Funds Customer Funds + 7.4% • Total liquid funds up 7% In € m 25,000 24,202 22,539 (4.5)% 3,446 3,609 • Client risk appetite on the rise 20,000 2,237 35.6% 1,650 15,000 • Gradual asset switch to higher margin investment products 10,000 7.2% 18,519 17,280 * 5,0

  13. Slide 13: Net Interest Income up 17% Y-o-Y

    Net Interest Income up 17% Y-o-Y In € m ƒ Recurrent strong + 3% 220 quarterly performance 206 200 • Balkan operations 192 10 200 contribute 5% of NII 9 6 196 191 180 186 • NIM at 3.09% in 1H 03 181 180 168 160 140 1Q 02 2Q 02 3Q 02 4Q 02 1Q 03 2Q 03 incl. Balkans 13

  14. Slide 14: Loan Margin drives NII

    Loan Margin drives NII Loan Margin in Greece NII Components In € m (in million euros) 250 200 206 192 200 181 180 16 Money market 17 mismatch 168 16 19 140 14 12 18 Earnings on 13 18 capital and bonds 150 25 24 38 130 130 26 37 Margin on deposits 37 123 34 37 120 35 117 100 110 108 107 128 135 108 1

  15. Slide 15: Fee income up 16% Y-o-Y, driven by asset mgmt. & capital markets

    Fee income up 16% Y-o-Y, driven by asset mgmt. & capital markets In € m + 9% • Capital Markets’ Fees jump 45% Q-o-Q on the back of 80 74 71 improving market conditions, 66 reflecting our leading 61 70 57 59 position 60 21 30 17 11 22 50 13 • Mutual Funds’ Fees rise 11 40 9 8 10 7 7 25% Q-o-Q as clie

  16. Slide 16: Core Income (NII + Fees) rising steadily

    Core Income (NII + Fees) rising steadily Y-o-Y evolution Q-o-Q evolution + 16% In € m In € m + 4.6% 544 300 278 467 280 266 266 137 260 238 239 400 118 240 229 71 407 74 66 220 349 57 59 200 61 206 180 192 200 200 181 180 160 168 140 120 0 100 1H 02 1H 03 1Q 02 2Q 02 3Q 02 4Q 02 1Q 03 2Q 03 NII incl

  17. Slide 17: Non-Core Income improving

    Non-Core Income improving ƒ Non-core income strengthening due to partial recovery in equity markets ƒ Goodwill gain of € 10.5 m booked in 1Q’03 ƒ 2Q non-core income after minorities at € 18.4 m vs. € 16.9 m in 1Q 03 Non-core income as reported Non-core income after minorities 40 20 30 15 20 10 21.1

  18. Slide 18: Total Operating Income up 16.5%

    Total Operating Income up 16.5% ƒ Core Income at 96% of Total Operating Income ƒ Top-line growth no longer burdened by non-core Income Y-o-Y evolution Q-o-Q evolution In € m + 16.5% In € m 600 565 + 11% 21 485 544 500 18 300 297 297 467 280 400 300 260 268 251 240 200 234 220 100 224 200 0 1Q 02 2Q

  19. Slide 19: Expenses contained on a comparable basis

    Expenses contained on a comparable basis Staff & Admin. Expenses up 3.5% Total Expenses up 6.2% excluding excluding Balkan subsidiaries (Q1 3.5%) Balkan subsidiaries (Q1 8.1%) In € m +3.5% In € m +6.2% 300 350 263 304 254 300 287 250 41 32 93 250 94 200 200 150 263 254 170 150 161 100 100 50 50 1H 0

  20. Slide 20: Improving efficiency

    Improving efficiency Cost-Income ratio Cost-Income ratio for the GROUP in GREECE % % 61.1 60.8 61 61 60.4 59.3 59.5 59.1 58 58 57.4 55 55 2002 1Q 03 1H 03 1H 02 2002 1Q 03 1H 03 20

  21. Slide 21: Good asset quality

    Good asset quality ƒ Organic NPLs at 2.9% of total loan book ƒ NPL Coverage at 84.5% % NPL Ratio Quarterly Bad Debt Provisions 5.0 In € m % 4.5 50.0 0.96 1.00 0.94 0.92 4.0 3.7% 3.6% 0.90 3.5 40.0 0.7 0.6 3.0 0.80 30.0 2.5 0.70 2.0 20.0 1.5 3.0 2.9 33 32 33 0.60 1.0 10.0 0.50 0.5 0.0 0.0 0.40 2002 1

  22. Slide 22: Core Profits in Greece at record level

    Core Profits* in Greece at record level In € m 80 + 7% 75 74 73 70 69 65 67 65 60 58 55 50 1Q 02 2Q 02 3Q 02 4Q 02 1Q 03 2Q 03 * Core Profit = NII + Fees – Cost - Provisions 22

  23. Slide 23: 1H 03 net profit up 11.5% Y-o-Y; 2Q net profit up 33%

    1H 03 net profit up 11.5% Y-o-Y 2Q 03 net profit up 33% over 2Q 02 In € m In € m + 33% + 11.5% 70 67 120 129 60 64 116 50 65 100 49 40 80 41 30 60 68 27 20 40 10 20 0 0 1Q 02 2Q 02 3Q 02 4Q 02 1Q 03 2Q 03 1H 02 2H 02 1H 03 23

  24. Slide 24: Strong capital base, improving returns

    Strong capital base, improving returns RoE ƒ Shareholders’ Equity at € 1.96 bn 13.0% 13.3% 13.4% ƒ Return on Equity at 13.4% 11.0% ƒ RoA at 0.88% ƒ RAR at 11.8% 9.0% 9.4% ƒ Return on Required Equity at 18.2% 7.0% (@ 8% of RWA) 5.0% FY 02 1Q03 1Η 03 RoA 1.0% RoE @ 8% RWA 1.00% 0.9% 18.2% 17% 0.8% 0.7

  25. Slide 25: 1H 2003 – Summary figures

    1H 2003 – Summary figures (in €mn) 1H 02 1H 03 % change Net interest income 349 407 16.6% Net fee and commission income 118 137 16.0% Core income 467 544 16.4% Non-core income 18 21 18.6% Total operating income 485 565 16.5% Operating expenses 287 335 16.9% Core profits 138 143 3.4% Net profit 116 1

  26. Slide 26: Quarterly Profitability

    Quarterly Profitability Greece including Balkan subsidiaries P&L figures per quarter (€ m.) 1Q 03 2Q 03 P&L figures per quarter (€ m.) 1Q 03 2Q 03 Interest Income 191.5 196.5 Interest Income 200.3 206.5 Commission Income 60.2 64.5 Commission Income 65.5 71.4 CORE INCOME 251.7 260.9 CORE INCOME 265.8

  27. Slide 27: Contacts

    Contacts EFG Eurobank Ergasias, 8 Othonos Str., 10557 Athens, Greece Fax: +30 210 3337150 E-mail: investor_relations@eurobank.gr Internet: www.eurobank.gr Reuters: EFGr.AT Bloomberg: EUROB GA Investor Relations Yannis Tegopoulos Tel: +30 210 3371222 E-mail: itegopoulos@eurobank.gr Marlen Miliadi Tel

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