Bawag Group Ag · VIE:BG
Bawag — Bawag Group Ag Ord — Q3 2024 Earnings Presentation
23 slides from Bawag's earnings presentation, Oct 28, 2024
Slide 1: BAWAG Group Q3 2024 Results
BAWAG Group Q3 2024 Results October 28, 2024
Slide 2: Agenda
AGENDA 1 Q3 2024 HIGHLIGHTS & CAPITAL DEVELOPMENT 2 DETAILED FINANCIALS & OUTLOOK 3 SUPPLEMENTAL INFORMATION October 28, 2024 BAWAG Group 2
Slide 3: Highlights Q3 2024
HIGHLIGHTS Q3 2024 EARNINGS BALANCE SHEET & CAPITAL OUTLOOK Q3 '24: Average customer loans down by (2%) vPQ and average Updating 2024 financial target given Knab approval: Net profit €178m, RoTCE of 24.0% and EPS of €2.25 interest-bearing assets down by (3%) vPQ Profit before tax of > €950m versus p
Slide 4: Strong Capital Generation in Q3 '24
STRONG CAPITAL GENERATION IN Q3 '24 Increasing CET1 target to 12.5% in light of two strategic acquisitions Q3 '24 DEVELOPMENT +70bps vs Q2 '24 17.2% 16.5% • Returning the Retail & SME business to Standardized Approach adding +€900m RWA (~80bps); 15.6% Goal to simplify business, streamline integratio
Slide 5: Retail & SME
RETAIL & SME FINANCIAL PERFORMANCE CUSTOMER DEVELOPMENT € millions Q3 '24 vPY vPQ YTD '24 vPY € millions Q3 '24 vPY vPQ YTD '24 vPY Core revenues 295.2 2% (1%) 889.3 5% Housing loans 14,633 (5%) (3%) 14,633 (5%) Net interest income 221.2 —% (1%) 668.3 4% Consumer and SME 6,893 7% 1% 6,893 7% Net com
Slide 6: Corporates, Real Estate & Public Sector
CORPORATES, REAL ESTATE & PUBLIC SECTOR FINANCIAL PERFORMANCE CUSTOMER DEVELOPMENT € millions Q3 '24 vPY vPQ YTD '24 vPY € millions Q3 '24 vPY vPQ YTD '24 vPY Core revenues 72.8 (8%) (5%) 228.5 (6%) Corporates 2,777 (26%) (9%) 2,777 (26%) Net interest income 64.1 (9%) (7%) 203.4 (5%) Real Estate 4,9
Slide 7: Commercial Real Estate Lending
COMMERCIAL REAL ESTATE LENDING PORTFOLIO DEVELOPMENT UNDERWRITING PRINCIPLES 6.1 • Residential and Industrial / Logistics make up 69% of the • Focus on risk-adjusted returns across all cycles … be 5.1 5.0 5.0 5.0 total portfolio and 83% of US portfolio … key growth patient lender with business that
Slide 8: Agenda
AGENDA 1 Q3 2024 HIGHLIGHTS & CAPITAL DEPLOYMENT 2 DETAILED FINANCIALS & OUTLOOK 3 SUPPLEMENTAL INFORMATION October 28, 2024 BAWAG Group 8
Slide 9: P&L & Key Ratios
P&L & KEY RATIOS P&L | € millions Q3 '24 vPY vPQ YTD '24 vPY Key ratios Q3 '24 vPY vPQ YTD '24 vPY Net interest income 305.3 (3%) (1%) 926.8 1% RoCE 20.4% (2.8)pts (0.1)pts 20.2% (0.7)pts Net commission income 82.6 8% 1% 245.3 7% RoTCE 24.0% (3.6)pts (0.3)pts 23.9% (0.9)pts Core revenues 387.9 (1%)
Slide 10: Balance Sheet
BALANCE SHEET Balance sheet | € millions Q3 '24 Q2 '24 vPQ vPY Capital & RWA | € millions Q3 '24 Q2 '24 vPQ vPY Total assets 55,726 53,633 4% 5% Common equity 3,545 3,447 3% 9% thereof Ø interest-bearing Tangible common equity 3,021 2,920 3% 10% 39,957 41,540 (4%) (5%) assets Customer loans 32,617 3
Slide 11: Funding Overview
FUNDING OVERVIEW Customer funding (avg.) … ~94% total funding € billion Share of covered bonds 44.4 46.5 46.2 DEPOSITS 41.9 39.2 • Retail & SME average deposits €26.5b, thereof ~80% insured by deposit guarantee scheme …. Average deposit size of €12k 25% 25% • Corporates & Public Sector average depos
Slide 12: Core Revenues
CORE REVENUES € millions Net interest margin Net commission income Net interest income (NII) down by (1%) vPQ … net interest margin (NIM) at 3.04% in Q3 '24 Net interest income • Average customer loans down by (2%) vPQ (excluding sale 390.3 394.0 392.8 391.4 of German bausparkasse) 387.9 • Deposit b
Slide 13: Operating Expenses
OPERATING EXPENSES € millions Operating expenses (excluding regulatory charges) CIR CIR at 32.3% in Q3 '24 down by 0.3pts vPQ • Focused on absolute cost targets and proactive cost management 126.2 127.1 126.8 121.9 123.4 • Executed multiple initiatives focused on greater scale, greater digital engag
Slide 14: Risk Costs
RISK COSTS € millions Risk costs Risk costs/average interest-bearing assets Q3 '24 risk costs €25m ... risk cost ratio 25bps 30.2 29.9 • Ongoing strong credit performance … NPL ratio of 1.0% 27.9 • ECL management overlay in Q3 '24 at €70m following 25.4 €10m usage for conservative CRE valuations 21.
Slide 15: 2024 Outlook and Targets
2024 OUTLOOK AND TARGETS 2024 FINANCIAL TARGETS (including M&A) Profit before tax >€950m FY ’23: €910m Save-the-date CET 1 Ratio >14.0% FY ’23: 14.7% INVESTOR DAY on 2024 & BEYOND RETURN TARGETS MARCH 4, 2025 Return on tangible common equity >20% Cost-income ratio <34% October 28, 2024 BAWAG Group 1
Slide 16: Agenda
AGENDA 1 Q3 2024 HIGHLIGHTS & CAPITAL DEPLOYMENT 2 DETAILED FINANCIALS & OUTLOOK 3 SUPPLEMENTAL INFORMATION October 28, 2024 BAWAG Group 16
Slide 17: Financial Performance
FINANCIAL PERFORMANCE P&L | € millions Q3 '24 vPY vPQ YTD '24 vPY Balance Sheet & Capital | € millions Q3 '24 Q2 '24 vPQ vPY Core revenues 387.9 (1%) (1%) 1,172.1 3% Total assets 55,726 53,633 4% 5% Net interest income 305.3 (3%) (1%) 926.8 1% Cash & Cash Equivalent 15,577 12,487 25% 42% Net commiss
Slide 18: Retail & SME
RETAIL & SME RETAIL & SME OVERVIEW CONSUMER & SME Retail & SME assets, in € billion Other DEVELOPMENTS NPL ratio 1.9% 1.6% 1.7% 1.9% 2.0% Credit box tightened since 2022 to account for cost inflation and 6% 21 22 22 22 22 rates impact on customer ability to pay SME 13% Ensure stress-resilient custom
Slide 19: Details on Reserves
DETAILS ON RESERVES IFRS 9 MIGRATION – CUSTOMER SEGMENT ASSETS NON-PERFORMING (STAGE 3) LOANS | in € millions Stage 3 2% 2% 2% 2% 2% 680 666 Stage 2 4% 5% 608 609 6% 6% 6% 538 Stage 1 94% 93% 92% 92% 92% Customer NPLs 2021 2022 2023 Q2 '24 Q3 '24 2021 2022 2023 Q2 '24 Q3 '24 NPL Ratio 1.0% 0.9% 1.0%
Slide 20: Corporates, Real Estate & Public Sector
Corporates, Real Estate & Public Sector CORPORATES1) REAL ESTATE PUBLIC SECTOR1) By industry By underlying By funding & type Services Food & beverage 5%1% 16% 20% 17% 9% Lender Financing Residential B-2-C Industrial / Logistics Term loans (incl. SSD) 4% Gaming 13% €2.8b 13% 16% Office €5.3b Bonds 5%
Slide 21: Regulatory Capital
REGULATORY CAPITAL € billion Dividend CET1 capital (post dividend) CET1 ratio (post dividend) 3.3 3.2 3.2 3.1 3.0 0.3 Capital distribution plans: 0.4 0.2 0.3 0.1 Dividend accrual of €286m for YTD '24 based on dividend 17.2% policy (55% of net profit) 16.5% 15.6% Capital ratios: 14.7% Q3 '24 Tier1 ca
Slide 22: Definitions
DEFINITIONS B/S leverage Net interest margin (NIM) Total assets/common equity (excluding earmarked dividend and buyback of €175m (1.1.2023) Net interest income (NII)/average interest-bearing assets Book value per share NPL cash coverage Common equity (excluding AT1 capital, dividends and buyback of
Slide 23: Important Disclaimer
IMPORTANT DISCLAIMER: This presentation is prepared solely for the purpose of providing general information about BAWAG Group, Wiedner Gürtel 11, 1100 Wien. The information does not constitute investment or other advice or any solicitation to participate in investment business. This presentation doe