Banca Monte Dei Paschi Di Siena S.p.a. · MIL:BMPS

Banca Monte Dei Paschi Di Siena — FY2022 Earnings Presentation

28 slides from Banca Monte Dei Paschi Di Siena's earnings presentation, Feb 8, 2023

  1. Slide 1: A Clear and Simple Commercial Bank - FY22 Preliminary Results

    A Clear and Simple Commercial Bank FY 22 Preliminary Results Siena, 8th February 2023

  2. Slide 2: Disclaimer

    Disclaimer THIS DOCUMENT IS BEING PROVIDED TO YOU SOLELY FOR YOUR INFORMATION. THIS DOCUMENT, WHICH WAS PREPARED BY BANCA MONTE DEI PASCHI DI SIENA S.P.A. (THE “COMPANY” AND TOGETHER WITH ITS CONSOLIDATED SUBSIDIARIES, THE “GROUP”), IS PRELIMINARY IN NATURE AND MAY BE SUBJECT TO UPDATING, REVISION A

  3. Slide 3: 4Q22 & FY22 Executive Summary

    4Q22 & FY22 Executive Summary  4Q22 net profit at EUR 156mln vs EUR -79mln in 4Q21, confirming the Bank’s achieved capability to generate sustainable returns  FY22 net profit excluding HR restructuring costs at EUR 720mln, driven by net operating profit and supported by EUR +425mln positive tax ef

  4. Slide 4: Net profit quarterly evolution

    Net profit quarterly evolution €/mln 156 10 18 -79 -388 4Q21 1Q22 2Q22 3Q22 4Q22 Net profit excluding HR restructuring costs and positive tax effect • 4Q22 net profit at EUR 156mln vs EUR -79mln in 4Q21, confirming the Bank’s achieved capability to deliver sustainable results 4

  5. Slide 5: Net profit yearly evolution

    Net profit yearly evolution €/mln 720 425(1) 310 49 (1) (2) (2) 260 295 925 -205 FY21 FY22 adjusted HR Restr. Costs FY22 reported • FY22 net profit at EUR 720mln, excluding EUR -925mln one-off HR restructuring costs, driven by gross operating profit and supported by EUR +425mln positive tax effect •

  6. Slide 6: Gross operating profit - quarterly evolution

    Gross operating profit quarterly evolution Operating income Gross operating profit €/mln +16.6% €/mln +65.6% +15.6% +64.5% 840 720 726 333 4Q21 3Q22 4Q22 201 203 Operating costs €/mln -2.3% -3.2% 519 524 507 4Q21 3Q22 4Q22 Cost/Income 72% 72% 60% 4Q21 3Q22 4Q22 • 4Q22 gross operating profit at EUR 3

  7. Slide 7: Gross operating profit - yearly evolution

    Gross operating profit yearly evolution Operating income Gross operating profit €/mln €/mln +3.6% +13.2% 2,980 3,088 139 49 989 2.841 +7.0% 3.040 874 49 139 FY21 FY22 Operating costs +28.0% 941 €/mln -0.3% 735 2.106 2.099 FY21 FY22 Capital gains from securities disposal FY21 FY22 • FY22 gross operat

  8. Slide 8: Net interest income

    Net interest income Quarterly evolution Yearly evolution €/mln +54.5% €/mln +26.0% +31.4% 499 1,539 42 1,222 157 380 323 17 186 57 457 1.382 362 1.036 +33.4% 266 4Q21 3Q22 4Q22 FY21 FY22 Lending rate 1.78% 2.11% 2.74% 1.81% 2.11% Funding rate 0.12% 0.12% 0.21% 0.15% 0.14% Spread 1.67% 1.99% 2.53% 1.

  9. Slide 9: Net customer loans

    Net customer loans Net loans(1) Performing loans retail €/bn €/bn +0.9% -1.4% 0.0% -2.5% 31,1 31,4 31,4 72,1 72,9 71,1 Dec 21 Sep 22 Dec 22 Performing loans corporate €/bn -3.2% -4.2% 41.0 41.4 39.7 3,1 3,5 3,0 2,1 1,9 1,7 37,9 38,0 36,7 Dec 21 Sep 22 Dec 22 Performing loans NPEs Dec 21 Sep 22 Dec 2

  10. Slide 10: Funding composition

    Funding composition Funding(1) Retail funding €/bn €/bn -1.3% -0.2% -3.4% 45,7 45,2 45,1 -1.8% 72,6 71,4 70,1 6.4 5.2 4.3 Dec 21 Sep 22 Dec 22 Corporate funding 66.2 66.2 65.8 €/bn -7.0% -4.7% 13,4 11,4 11,3 26,9 26,3 25,0 Dec 21 Sep 22 Dec 22 Current accounts Term deposits Bonds and other Dec 21 Se

  11. Slide 11: Italian govies portfolio

    Italian govies portfolio Italian govies portfolio breakdown Italian govies portfolio at FVTOCI €/bn 12.0 11.4 10.2 Dec 21 Sep 22 Dec 22 2,8 2,9 0,8 FVTOCI Duration 3,4 ~2.1 ~2.1 ~1.9 4,5 (years) 3,6 FVTOCI Credit 6,0 spread sensitivity -1.1 -0.8 -0.7 4,7 4,9 (€/mln) Dec 21 Sep 22 Dec 22 Amortized co

  12. Slide 12: Net fee and commission income - quarterly

    Net fee and commission income quarterly evolution Banking fees Wealth Management fees €/mln €/mln -9.7% -25.4% -4.1% -7.8% 204 192 184 167 135 107 98 53 125 95 34 23 43 48 41 114 102 102 54 46 48 4Q21 3Q22 4Q22 4Q21 3Q22 4Q22 Loans Current accounts and other (1) Payments and cards Continuing fees Up

  13. Slide 13: Net fee and commission income - yearly

    Net fee and commission income yearly evolution Banking fees Wealth Management fees €/mln €/mln -2.1% -14.8% 791 774 693 590 419 407 254 169 190 184 439 421 182 184 FY21 FY22 FY21 FY22 Loans Current accounts and other*(1) Payments and cards Continuing fees Up-front fees • Banking fees in 2022 with po

  14. Slide 14: Indirect funding

    Indirect funding Indirect funding breakdown AuM & Bancassurance breakdown €/bn Market effect €/bn -11.5% y/y q/q +1.0% -12.3% +0.9% 104.4 65.3 58.0 57.7 91.5 92.4 8% 8% 9% 39,1 33,5 34,7 46% 47% 47% 65,3 58,0 57,7 46% 45% 44% Dec 21 Sep 22 Dec 22 Dec 21 Sep 22 Dec 22 AuM & Bancassurance Asset under

  15. Slide 15: Operating costs - quarterly evolution

    Operating costs quarterly evolution HR costs Operating costs €/mln -6.9% €/mln -7.6% -2.3% 351 354 -3.2% 327 519 524 507 4Q21 3Q22 4Q22 Non-HR costs €/mln +7.1% +5.9% 180 168 170 4Q21 3Q22 4Q22 4Q21 3Q22 4Q22 • Lower operating costs q/q and y/y, thanks to HR benefiting from the exit of >4k employees

  16. Slide 16: Operating costs - yearly evolution

    Operating costs yearly evolution HR costs Operating costs €/mln €/mln -2.4% 1.428 1.394 -0.3% 2.106 2.099 FY21 FY22 Non-HR costs €/mln +4.1% 678 706 FY21 FY22 FY21 FY22 • Operating costs lower by -0.3% y/y, thanks to HR costs benefiting of 1st December >4k FTE reduction • Non-HR costs y/y dynamic af

  17. Slide 17: Gross NPE stock

    Gross NPE stock Gross NPE stock Breakdown by category €/bn -19.6% €/bn 4.1 4.1 4,1 4,1 3.2 3.3 2,4 2,2 3,3 1,9 2,0 3,2 1,7 1,9 1,3 1,3 Dec 21 Sep 22 Sep 22 Dec 22 Dec 21 Sep 22 Sep 22 Dec 22 proforma proforma Gross NPE Bad loan UTP + Past due 4.9% 5.0% 4.0% 4.2% ratio(1) Net NPE 2.6% 2.4% 2.1% 2.2%

  18. Slide 18: Coverage and cost of risk

    Coverage and cost of risk NPE coverage breakdown Cost of risk (bps) 63,7% 65,0% 65,1% 36,7% 36,6% 37,5% 22,7% 26,4% 22,7% 56 58 55 49 51 Bad loan Coverage UTP Coverage Past Due Coverage Dec 21 Sep 22 Dec 22 31 proforma (1) Total NPE coverage Bad loans/ 47,9% 47,8% 48,1% Total NPEs FY21 1Q22 2Q22 3Q2

  19. Slide 19: Capital

    Capital CET1 ratio phased-in Regulatory capital ratio phased-in 16,6% Dec 21 Sep 22 Dec 22 SREP 15,7% 12,5% CET1 ratio (%) 12.5% 10.0% 8.80% 10,0% 16.6% 8,8% Tier 1 ratio (%) 12.5% 10.0% 16.6% 10.82% Dec 21 Sep 22 Sep 22 Dec 22 SREP Total capital 16.1% 13.9% 20.5% 13.51% proforma(1) 2023 ratio (%) C

  20. Slide 20: Extraordinary litigations and extrajudicial claims

    Extraordinary litigations and extrajudicial claims €/bn Gross petitum Dec 21 Sep 22 Dec 22 Litigations Financial information 2014-2015 0.3 0.3 0.7 excluding civil Financial information 2008-2011 0.4 1.2 0.9  Two new positive judgements in parties Total 0.7 1.5 1.6 the first weeks of 2023 confirmed

  21. Slide 21: After one year, a stronger, more efficient and profitable Bank

    After one year, a stronger, more efficient and profitable Bank, well on track in reaching Business Plan targets Stronger Solidity: CET1 ratio FL Cost savings: FTE reduction Improved Balance Sheet: Gross NPE Ratio % #k %  CET1 FL stronger thanks to capital increase and  FTE optimization with evolut

  22. Slide 22: Outlook 2023

    Outlook 2023 2023 2024 BP Targets Memo: Outlook Outlook 2024 BP Targets  NII growth thanks to step up in retail lending improving commercial assets mix, supported by higher rates, despite increased cost of Revenues EUR 3.1 bn institutional funding. Fees income back to a positive dynamic supported b

  23. Slide 23: Conclusions

    Conclusions  Net profit of 4Q22 at EUR 156mln after the capital increase and the completion on December 1st of >4k FTE reduction through the voluntary scheme  FY22 gross operating profit at EUR 989mln, up by +13.2% y/y and C/I at 60% in the quarter, confirming achieved sustainability of results 

  24. Slide 24: Annexes

    E DEI PASCHI DI SIENA Annexes 24

  25. Slide 25: Reclassified Income Statement

    Reclassified Income Statement 4Q22/ FY22/ € mln 4Q22 3Q22 2Q22 1Q22 FY22 FY21 3Q22(%) FY21(%) Net Interest Income 499 380 337 323 1,539 1,222 +31.4% +26.0% Net fees and commission income 309 327 359 369 1,365 1,484 -5.6% -8.0% Profit (loss) of equity-accounted investments (AXA) 26 27 -3 14 64 104 -3

  26. Slide 26: Balance Sheet

    Balance Sheet Total Assets (€/mln) Dec-21 Sep-22 Dec-22 QoQ% YoY% Loans to Central banks 20,770 4,426 628 -85.8% -97.0% Loans to banks 3,493 2,716 2,509 -7.6% -28.2% Loans to customers 79,380 77,939 76,265 -2.1% -3.9% Securities assets 22,127 19,794 18,394 -7.1% -16.9% Tangible and intangible assets

  27. Slide 27: Lending & Direct Funding

    Lending & Direct Funding Total Lending (€/mln) Dec-21 Sep-22 Dec-22 QoQ% YoY% Current accounts 2,696 3,062 2,883 -5.8% 6.9% Medium-long term loans 56,268 55,702 54,541 -2.1% -3.1% Other forms of lending 13,152 14,105 13,648 -3.2% 3.8% Reverse repurchase agreements 5,126 3,166 3,483 10.0% -32.1% Impa

  28. Slide 28: ESG objectives and activities rooted in the Bank to support sustainable transition

    ESG objectives and activities increasingly rooted in the Bank to support sustainable transition Environmental impact & innovation Sustainable Finance ESG Governance % of Scope 1 emissions % MLT ESG lending on Total New Lending Diversity & Inclusion % of women in roles of reduction vs. 2017 responsib

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