Banco Comercial Portugues S.a. · EURONEXT:BCP
Banco Comercial Portugues — Q1 2022 Earnings Presentation
62 slides from Banco Comercial Portugues's earnings presentation, May 16, 2022
Slide 1: Apresentação de Resultados 1S 2021
APRESENTAÇÃO DE RESULTADOS 1S 2021 Banco Comercial Português 1
Slide 2: Disclaimer
Disclaimer l The information in this presentation has been prepared under the scope of the International Financial Reporting Standards (‘IFRS’) of BCP Group for the purposes of the preparation of the consolidated financial statements under Regulation (CE) 1606/2002, as amended. l The figures present
Slide 3: Agenda
AGENDA 3
Slide 4: Highlights
01 Highlights 4
Slide 5: Macroeconomic scenario marked by uncertainty
Macroeconomic scenario marked by uncertainty Real GDP Evolution 2018-2021 2022 real GDP growth projection review Year on year change (IMF) IMF Jan/22 (*oct/21) Apr/22 6% Poland 5.7% 4.9% Portugal -1.1 -0.9 -1.1 -0.3 -0.8 3% p.p. p.p. p.p. p.p. p.p. 2.2% Mozambique 0% 5.1% 4.6% 4.4% 4.0% 3.7% 3.9% 4.
Slide 6: Highlights: Robust business model
Highlights: Robust business model ▪ Net profit of 112.9 million (+95.2%), including 123.3* million of costs related with Bank Millennium’s CHF loan portfolio. Excluding costs associated with CHF loans, net profit would amount to 174.6 million (+52.6%) ▪ Net profit of 107.6 million in Portugal, corre
Slide 7: Highlights: Robust business model
Highlights: Robust business model ▪ Consolidated performing loans up by 3.1 billion, +5.8% from March 2021; performing loans in Portugal up by 2.1 billion, +5.7% from march 2021 Business ▪ Total Customer funds up by 6.5 billion, +7.7% from March 2021 (+7.2% in Portugal) activity ▪ On-balance-sheet C
Slide 8: Growing Customer base, mobile Customers standing out
Growing Customer base, mobile Customers standing out ‘000 Customers As % of active Customers Group Active Customers 5,921 6,215 +595 3,630 3,036 58% +20% Mobile Customers Mar 21 Mar 22 +496 Digital Customers 3,914 4,410 71% +13% Active Customers 2,439 2,555 +207 1,219 1,013 48% Mobile Customers +20%
Slide 9: Our capabilities in digital are widely recognised and recommended
A. Our capabilities in digital are widely recognised and recommended App Millennium App Millennium leads ratings lidera ratings Digital Channels Satisfaction #1 NPS1 Digital Customers “Best Digital Bank” Unaided nomination by Customers2, 4.8 2018 – 2022 (Mar.), 5 largest banks 1 T 2022 53.9 58.6 45.
Slide 10: Innovation focused on customer needs translates into accelerated growth in Mobile
Innovation focused on customer needs translates into accelerated growth in Mobile usage and sales Strong mobile growth Y/Y (Number of operations, jan-mar 2022 vs jan–mar 2021) +30% +124% Transfers +25% National +8% Payments Transactions P2P Transfers +46% +160% +250% +32% Sales Cards Personal loans
Slide 11: Group Profitability
02 Group Profitability 11
Slide 12: Net income of 112.9 million the 1st quarter of 2022
Net income of 112.9 million the 1st quarter of 2022 Impact on (Million euros) Q1'21 Q1'22 YoY earnings Net interest income 374.8 465.1 +24.1% +90.3 Commissions 171.1 192.8 +12.7% +21.7 Core income 545.9 657.9 +20.5% +112.0 Operating costs -252.1 -255.0 +1.1% -2.9 Core operating profit 293.8 402.9 +3
Slide 13: Net interest income
Net interest income Net interest income Portugal (Consolidated, million euros) (Million euros) Net interest Net interest 1.50% 1.41% 1.92% 2.19% margin margin +24.1% +3.6% 465.1 211.8 204.5 374.8 Q1'21 Q1'22 International operations (Million euros) Net interest margin 2.90% 4.13% +48.8% 253.3 170.3
Slide 14: Fees and commissions
Fees and commissions Fees and commissions Portugal (Consolidated, million euros) (Million euros) +14.1% 136.5 119.6 +12.7% 21.4 17.9 192.8 171.1 101.7 115.0 27.6 Market-related fees and 25.4 commissions Q1'21 Q1'22 International operations (Million euros) Banking fees 165.3 +9.4% and commissions 145
Slide 15: Other income
Other income Other income Portugal (Consolidated, million euros) (Million euros) 49.6 76.3 Total 32.0 42.8 10.8 16.2 15.0 2.0 Equity earnings + 17.1 32.6 49.3 15.4 dividends Q1'21 Q1'22 Net trading income 41.8 43.4 International operations (Million euros) -17.5 -33.5 Other operating -17.7 -25.1 0.4
Slide 16: Operating costs
Operating costs Operating costs Portugal (Consolidated, million euros) (Million euros) Cost to income 40% 34% Cost to income 44% 36% -5.0% +1.1% 150.7 143.2 252.1 255.0 Depreciation 34.0 34.6 Q1'21 Q1'22 Other administrative 76.7 82.7 costs* International operations* (Million euros) Cost to income 5
Slide 17: Cost of risk and provisions
Cost of risk and provisions Portugal Impairment and provision charges (Million euros) (Consolidated, million euros) Cost of risk 94bp 68bp +21.9% Cost of risk 80bp 62bp 124.7 102.3 +4.6% 11.4 56.2 91.0 68.5 254.0 242.7 Q1'21 Q1'22 -14.7% Loan-loss reserves 1.436 1.225 97.4 CHF mortgage legal risk 11
Slide 18: Relevant reduction of NPEs under a complex context
Relevant reduction of NPEs under a complex context Credit (Consolidadas, milhõesquality de euros) Portugal (Consolidated, billion euros) (Billion euros) -405 millions -18.5% -421 millions 2.19 -13.6% 1.79 NPE 3.10 2.68 Other 1.53 1.51 Mar 21 Mar 22 NPL>90d NPE loans ratio 5.7% 4.4% 1.57 1.17 NPE rat
Slide 19: Group Business activity
02 Group Business activity 19
Slide 20: Customer funds keep growing
Customer funds keep growing Total Customers Funds* Total Customers Funds* Portugal (Billion euros) (Consolidated, billion euros) +7.2% +7.7% 62.1 66.6 91.4 16.6 16.2 84.8 1.5 1.5 16.4 17.9 16.2 Off-BS funds 18.5 27.9 32.6 1.6 Other BS funds 1.5 Mar 21 Mar 22 22.4 Total Customers Funds* international
Slide 21: Relevant increase of the loan portfolio
Relevant increase of the loan portfolio Loans to Customers (gross) Portugal (Consolidated, billion euros) (Billion euros) +1.67 billion NPE: -13.6% (-0.4 billion) Performing: +5.8% (+3.1 billion) +4.3% +2.08 40.32 +4.7% 38.64 58.5 55.8 -0.41 28.2 Mar 21 NPE Performing Mar 22 Mortgage 26.6 Internatio
Slide 22: Group Capital and liquidity
02 Group Capital and liquidity 22
Slide 23: Capital above regulatory requirements
Capital above regulatory requirements Total capital ratio • Total capital ratio of 15.5% and CET1 capital (Fully implemented) ratio of 11.5% (fully implemented) as of +2.4pp Fully implemented 16.2%** vs requirement March 2022, above SREP requirements 15.5% application of article 13.75% 352 ( 2 ) imp
Slide 24: Capital at adequate levels
Capital at adequate levels Leverage ratio (Fully implemented, latest available data) 5.1% 5.2% 5.8% 5.7% 3.6% Leverage ratio at 5.7% as of March 2022, a comfortable and comparatively strong figure in European banking 3.0% FR DE ES IT RWA density (RWAs as a % of assets, latest available data) High RW
Slide 25: Reinforced liquidity position
Reinforced liquidity position Liquidity ratios (CRD/CRR) ECB funding, net (Billion euros) Eligible assets 23.0 23.9 283% -2,2 billion Net funding 2.9 0.7 TLTRO 8.2 8.2 Deposits and other -5.3 -7.5 150% Mar 21 Mar 22 Net loans to deposits ratio 83% 79% 100% NSFR (Net stable LCR (Liquidity Mar 21 Mar
Slide 26: Portugal
03 Portugal 26
Slide 27: Resilient profitability in Portugal
Resilient profitability in Portugal Net income Net operating revenue (Million euros) (Million euros) +29.0% +13.6% 424.5 373.6 107.6 83.4 Q1'21 Q1'22 Q1'21 Q1'22 Operating costs (Million euros) -5.0% • Net income of 107.6 million in 1st quarter of 2022, an increase of 29.0% from 1st quarter of 2021
Slide 28: Net interest income
Net interest income (Million euros) +3.6% 204.5 +10.3 +1.6 211.8 +1.9 +1.8 +2.9 -9.0 -1.0 -1.3 NIM 1.50% 1.41% Q1'21 Performing Credit rate Impact of Deposits' rate Excess liquidity Impact of the Effect of Other Q1'22 credit volume effect NPE reduction effect (ECB, TBills) securities wholsesale cost
Slide 29: Stabilization of the cost of deposits
Stabilization of the cost of deposits Spread on the book vs 3mof term deposits Euribor Spread on the performing loan book (vs 3m Euribor) (vs 3m Euribor) Q1'21 Q1'22 2.66% 2.62% -0.55% -0.58% Q1'21 Q1'22 3m Euribor 3m Euribor (average) -0.54% -0.53% (average) -0.54% -0.53% NIM • Spread of the portfo
Slide 30: Commissions and other income
Commissions and other income Commissions (Milhões deOther euros) income (Million euros) (Million euros) Q1'21 Q1'22 YoY Total 49.6 76.3 Banking fees and commissions 101.7 115.0 +13.1% Cards and transfers 23.6 30.8 +31.0% 10.8 Loans and guarantees 25.0 27.8 +11.3% Bancassurance 21.8 22.1 +1.2% 16.2 O
Slide 31: Operating costs
Operating costs Operating costs Employees (Million euros) -5.0% -740 150.7 7,004 6,264 143.2 Depreciation 19.8 20.0 Other administrative 43.0 Mar 21 Mar 22 costs 43.4 Branches -55 Staff costs 87.8 79.9 476 421 Q1'21 Q1'22 Mar 21 Mar 22 31
Slide 32: Continued decrease of NPEs
Continued decrease of NPEs Non-performing exposures (NPE) NPE build-up (Million euros) Mar 22 Mar 22 (Million euros) -405 million vs.Mar 21 vs.Dec 21 -18.5% Opening balance 2,193 1,878 2,193 Net outflows/inflows 172 85 1,788 Write-offs -348 -93 Other NPE 1,118 Sales -230 -81 1,080 NPL>90d 1,075 Endi
Slide 33: NPE coverage
NPE coverage NPE total coverage* NPL>90d total coverage* 209% 143% 132% 22% 173% 99% 43% 48% 30% Real estate collateral 48% Real estate collateral 99% 20% 32% Cash, other fin.collat. 63% 15% Cash, other fin.collat. 48% 139% 1% 81% 69% LLRs 1% 110% LLRs 35% 51% Individuals Companies Total Individuals
Slide 34: Foreclosed assets and corporate restructuring funds
Foreclosed assets and corporate restructuring funds Foreclosed assets Corporate restructuring funds (Million euros) (Million euros) 768 -3.9% Impairment 136 820 788 469 101 87 Industry 100 632 -263 million Net value 719 701 RE/tourism 369 -41.6% Mar 21 Mar 22 Mar 21 Mar 22 Sales of foreclosed assets
Slide 35: Growing customer funds and loans to customers
Growing customer funds and loans to customers Total Customers Funds* Loans to Customers (gross) (Billion euros) (Billion euros) +7.2% NPE: -18.5% (-0.4 billion) Performing: +5.7% (+2.1 billion) 66.6 62.1 +4.3% 16.2 40.3 16.6 38.6 Off-BS funds 1.5 Other BS funds 1.5 16.4 17.6 18.6 Mortgage Term depos
Slide 36: Performing credit grows in Portugal
Performing credit grows in Portugal Performing credit portfolio • Performing credit portfolio in Portugal up by 2.1 billion (+5.7%) (Billion euros) from March 2021, supported in growth in mortgage loans and loans +5.7% to companies 36.5 38.5 • Mortgage loans up by 1.1 billion from March 2021 (6.1%)
Slide 37: International operations
04 International operations 37
Slide 38: Contribution from international operations to consolidated net income
Contribution from international operations to consolidated net income (Million euros*) Q1’21 Q1’22 Contribution from international operations (Million euros*) Poland -67.2 -26.4 5.3 Mozambique** 17.9 24.3 Other -4.5 0.9 Net income international operations -53.9 -1.2 Discontinued Operations*** 3.3 1.
Slide 39: Net earnings affected by costs related with CHF loans
Net earnings affected by costs related with CHF loans Net income Net operating revenue (Million euros*) (Million euros*) +115.3% +33.8% 104.8 48.7 250.4 Adjusted net income** 187.2 -26.4 Net income -67.2 Q1'21 Q1'22 Q1'21 Q1'22 3m WIBOR (average) 0.21% 3.50% • Adjusted net income** up by 115.3% Oper
Slide 40: Net interest income increase
Net interest income increase Net interest income* Operating costs (Million euros*) (Million euros*) NIM 2.56% +54.4% 3.77% +13.8% 105.0 92.3 18.5 207.5 Resol. Fund and DGF 11.5 +61.6% 134.3 Other 36.4 +8.2% 39.4 Staff costs 44.4 +6.0% 47.0 Q1'21 Q1'22 Q1'21 Q1'22 Commissions and other income Mandato
Slide 41: Credit quality
Credit quality NPL>90d Loan-loss reserves (Million euros*) (Million euros*) Credit ratio 2.6% 2.2% Coverage ratio 122% 137% NPL>90d NPL>90d 523.0 534.9 427.4 390.7 Mar 21 Mar 22 Mar 21 Mar 22 Loan impairment (net of recoveries) (Million euros*) • NPL>90d accounted for 2.2% of total credit as of Cost
Slide 42: Increased Customers funds and loans to Customers
Increased Customers funds and loans to Customers Customers funds Loans to Customers (gross) (Million euros*) (Million euros*) +8.0% +5.4% 22,698 21,013 17,511 1,701 9 16,621 Off-BS funds 1,939 Other BS funds 37 4,911 Term deposits 3,594 Mortgage 6,087 7,544 local currency Mortgage foreign exchange 2
Slide 43: CHF mortgages
CHF mortgages CHF mortgage portfolio Cumulative provisions for legal risks (Billion euros*) (Million euros*) As a % of total As a % of CHF 54.6% 16.6% 11.4% 10.7% 6.9% 11.3% 14.9% 19.5% 25.7% 30.3% loan portfolio mortgage portfolio -19% 7.3% 8.9% 11.3% 13.2% 15.9% TBD Peers’ average** 6.5 -5% 741.5
Slide 44: Net income reflects resilience in challenging environment
Net income reflects resilience in challenging environment Net income** Net operating revenue (Million euros*) (Million euros*) +36.1% +18.9% 24.3 17.9 62.1 52.2 Q1'21 Q1'22 Q1'21 Q1'22 MIMO rate (average) 12.38% 13.27% Operating costs (Million euros*) • Net income of 24.3 million in 1st quarter of 2
Slide 45: Significant growth in net interest income and commissions
Significant growth in net interest income and commissions Net Interest income Operating costs (Million euros*) (Million euros*) NIM 7.4% 7.9% Cost to income 46.7% 41.9% +12.3% +6.7% 45.1 40.2 24.4 26.0 Other 14.2 +8.6% 15.4 Staff costs 10.2 +4.0% 10.6 Q1'21 Q1'22 Q1'21 Q1'22 Commissions and other in
Slide 46: Credit quality
Credit quality NPL>90d Loan-loss reserves (Million euros*) (Million euros*) Credit ratio Coverage ratio NPL>90d 12.2% 10.9% NPL>90d 67% 83% 80.5 69.7 53.6 58.0 Mar 21 Mar 22 Mar 21 Mar 22 Loan impairment (net of recoveries) (Million euros*) Cost of risk 306bp 203bp • NPL>90d ratio of 10.9% as of Mar
Slide 47: Business volumes
Business volumes Customers funds Loans to Customers (gross) (Million euros*) (Million euros*) +6.3% 2,025 -3.0% 1,904 659 639 Mortgage 11 11 1,094 Personal and 116 Term deposits 937 other 142 Companies 532 487 Demand 967 931 deposits Mar 21 Mar 22 Mar 21 Mar 22 *FX effect excluded. €/Metical constan
Slide 48: Key figures
05 Key figures 48
Slide 49: Strategic Plan: Excelling 24
Strategic Plan: Excelling 24 Q1’22 2024 C/I ratio 36% ≈40% Cost of risk 62 bp ≈50 bp RoE 8.2% ≈10% CET1 ratio 11.5% >12.5% (12.0% pro forma*) NPE ratio 4.6% ≈4% Share of mobile Customers 58% >65% Growth of high engagement +5% +12% Customers** (vs 2020) Average ESG rating*** 70% >80% * Pro forma (sub
Slide 50: Commitment to People and Society
COMMITMENT TO PEOPLE AND SOCIETY Millennium bcp Foundation Society Sustainability In 2022, all the electricity spent by the Bank “Museu dos Coches”: Restoration of the in Portugal was 100% green, in a mix of Royal House ride cart, used by members of energy produced by the TagusPark Millennium bcp su
Slide 51: Awards in 2022
Awards in 2022 Millennium bcp: Prizes Growing Structured Finance and Local Market Member in Equity Millennium bcp: Best Foreign Exchange Provider in Portugal Millennium bcp Consumer Choice 2022, Bank Millennium: 1st place in the Summary “Large banks” category of macroeconomic forecasts for 2021, by
Slide 52: Appendix
Appendix 52
Slide 53: Sovereign debt portfolio
Sovereign debt portfolio Sovereign debt portfolio Sovereign debt maturity (Consolidated, million euros) >5y, ≤8y: 31% Mar 21 Jun 21 Sep 21 Dec 21 Mar 22 YoY QoQ Portugal 8,420 9,152 8,069 8,013 8,561 +2% +7% >8y, ≤10y: 14% T-bills and other 514 1,129 497 426 849 +65% +99% Bonds 7,906 8,023 7,572 7,5
Slide 54: Sovereign debt portfolio detail
Sovereign debt portfolio detail (Million euros) Portugal Poland Mozambique Other Total Trading book 863 22 0 0 885 ≤ 1 year 848 4 0 0 851 > 1 year and ≤ 2 years 4 0 0 0 4 > 2 years and ≤ 5 years 8 14 0 0 22 > 5 years and ≤ 8 years 1 3 0 0 5 > 8 years and ≤ 10 years 1 1 0 0 1 > 10 years 1 0 0 0 1 Ban
Slide 55: Diversified and collateralised portfolio
Diversified and collateralised portfolio Loan portfolio (Consolidated) LTV of the mortgage portfolio Breakdown Loans per collateral in Portugal Other 75-80 Mortgage guarantees 9% 60-75 80-90 48% 28% 27% 12% Companies >90 42% Real 5% guarantees 58% 50-60 Unsecured 0-40 14% 15% 21% 40-50 12% Personal/
Slide 56: Consolidated net income
Consolidated net income Impact on (Million euros) Q1'21 Q1'22 YoY earnings Net interest income 374.8 465.1 +24.1% +90.3 Net fees and commissions 171.1 192.8 +12.7% +21.7 Other income* 32.0 42.8 +33.6% +10.8 Net operating revenue 577.9 700.7 +21.2% +122.8 Staff costs -141.5 -137.7 -2.6% +3.7 Other ad
Slide 57: Consolidated balance sheet
Consolidated balance sheet (Million euros) 31 March 31 March 2021 31 March 31 March 2021 2022 (restated) 2022 (restated) LIABILITIES ASSETS Financial liabilities at amortised cost Cash and deposits at Central Banks 9,829.6 6,506.6 Resources from credit institutions 8,979.7 9,186.2 Loans and advances
Slide 58: Consolidated income statement per quarter
Consolidated income statement per quarter (Million euros) 1Q 21 2Q 21 3Q 21 4Q 21 1Q 22 Net interest income 374.8 391.0 399.2 423.6 465.1 Dividends from equity instruments 0.0 0.7 0.2 0.1 0.9 Net fees and commission income 171.1 181.8 181.9 192.9 192.8 Other operating income -25.1 -87.2 -4.5 -9.5 -1
Slide 59: Income statement
Income statement (Million euros) For the 3-month periods ended March 31th, 2021 and 2022 Int e rna t io na l o pe ra t io ns G ro up P o rt uga l T o tal B a nk M ille nnium ( P o la nd) M ille nnium bim ( M o z.) O t he r int . o pe ra t io ns M ar 2 1 M ar 2 2 Δ % M ar 2 1 M ar 2 2 Δ % M ar 2 1 M
Slide 60: Glossary (1/2)
Glossary (1/2) Assets placed with customers – amounts held by customers in the context of the placement of third-party products that contribute to the recognition of commissions. Balance sheet customer funds – deposits and other resources from customers and debt securities placed with customers. Bus
Slide 61: Glossary (2/2)
Glossary (2/2) Net trading income – results from financial operations at fair value through profit or loss, results from foreign exchange, results from hedge accounting operations, results from derecognition of financial assets and financial liabilities measured at amortized cost and results from de
Slide 62: Investor Relations Division
INVESTOR RELATIONS DIVISION Bernardo Collaço, Head EQUITY DEBT AND RATINGS Alexandre Moita Luís Morais +351 211 131 321 +351 211 131 337 investors@millenniumbcp.pt BANCO COMERCIAL PORTUGUÊS, S.A., a public company (Sociedade Aberta), having its registered office at Praça D. João I, 28, Oporto, regis
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