Erste Group Bank Ag · VIE:EBS
Erste Group Bank — Q1 2012 Earnings Presentation
93 slides from Erste Group Bank's earnings presentation, Apr 30, 2012
Slide 1: Erste Group – Q1 2012 results presentation
Erste Group – Q1 2012 results presentation 30 April 2012 Strong net profit complemented by early EBA capital compliance Andreas Treichl, CEO, Erste Group Manfred Wimmer, CFO, Erste Group Gernot Mittendorfer, CRO, Erste Group
Slide 2: Disclaimer – Cautionary note regarding forward-looking statements
Disclaimer – Cautionary note regarding forward-looking statements − THE INFORMATION CONTAINED IN THIS DOCUMENT HAS NOT BEEN INDEPENDENTLY VERIFIED AND NO REPRESENTATION OR WARRANTY EXPRESSED OR IMPLIED IS MADE AS TO, AND NO RELIANCE SHOULD BE PLACED ON, THE FAIRNESS, ACCURACY, COMPLETENESS OR CORREC
Slide 3: Q1 2012 executive summary
Q1 2012 executive summary – Good start into 2012; EBA compliance ahead of schedule − Strong quarterly net profit of EUR 346.5m in Q1 2012 due to profitable core business in Austria, Czech Republic & Slovakia and one-off items: − Gain on buyback of tier 1 and tier 2 instruments in the amount of EUR 2
Slide 4: Presentation topics
Presentation topics − Business performance − Update on Hungary & Romania − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure Q1 2012 results 30 April 2012 4 London
Slide 5: Operating environment: macro trends
Operating environment: macro trends – CEE continued to outgrow the euro zone in Q1 2012 − Different growth patterns in line with levels of Real GDP growth in CEE export dependency and country-specific issues 8 2012 euro zone avg. 0.0% − AT: Economic growth continued in Q1 2012 despite fiscal 6 4.2 3
Slide 6: Key financial indicators
Key financial indicators – EPS and ROE increased yoy and qoq YTD cost income ratio YTD net interest margin 55.9% 53.8% 3.05% 50.8% 2.86% 2.90% 2.87% 48.9% 2.77% 48.3% 1-3 08 1-3 09 1-3 10 1-3 11 1-3 12 1-3 08 1-3 09 1-3 10 1-3 11 1-3 12 Cash earnings per share** Cash return on equity** 1.04 15.3% 1.
Slide 7: Income statement (IFRS) – Q1 2012 vs Q1 2011
Income statement (IFRS) – Sound operating result and positive one-off in Q1 2012 in EUR million 1-3 12 1-3 11 Change Comment Net interest income 1,336.9 1,302.0 2.7% Solid performance of core business Risk provisions for loans (580.6) (460.1) 26.2% Extraordinary provisions in HU, RO Net fee and comm
Slide 8: Income statement (IFRS) – Q1 2012 vs Q4 2011
Income statement (IFRS) – Sound operating result and positive one-off in Q1 2012 in EUR million Q1 12 Q4 11 Change Comment Net interest income 1,336.9 1,434.9 (6.8%) Shift NII on trading assets in Q4 11 (EUR 53m) Risk provisions for loans (580.6) (407.7) 42.4% Additional provisions in HU, RO Net fee
Slide 9: Balance sheet (IFRS) – Assets
Balance sheet (IFRS) – Further RWA reduction in non-core business in EUR million Mar 12 Dec 11 Change Comment Cash and balances with central banks 5,480 9,413 (41.8%) Excess liquidity deposited with OeNB Loans and advances to credit institutions 13,403 7,578 76.9% Excess liquidity deposited with OeN
Slide 10: Balance sheet (IFRS) – Liabilities and equity
Balance sheet (IFRS) – Equity up, loan-to-deposit ratio improved to 110.2% in EUR million Mar 12 Dec 11 Change Comment Deposits by banks 25,373 23,785 6.7% LTRO inflow Customer deposits 122,349 118,880 2.9% Growth mainly in AT & CZ Debt securities in issue 32,135 30,782 4.4% Successful issuance of c
Slide 11: Segment highlights
Segment highlights – CZ, AT & SK doing well, RO and HU underperform Top segment performers in Q1 2012: Czech Republic Slovakia EBOe in EUR million 1-3 12 1-3 11 Change 1-3 12 1-3 11 Change 1-3 12 1-3 11 Change Operating income 412 425 (3.1%) 136 138 (1.3%) 241 237 1.6% Operating expenses (180) (185)
Slide 12: Presentation topics
Presentation topics − Business performance − Update on Hungary & Romania − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure Q1 2012 results 30 April 2012 12 London
Slide 13: Hungary update
Hungary update – Operating in a challenging environment − New fiscal package announced – important step to start IMF/EU talks − Package to increase budget savings with the aim to meet deficit targets − Combination of new taxes and spending cuts − Very important step toward IMF agreement − Still frag
Slide 14: Romania update – Domestic consumption and investments to drive recovery
Romania update – Domestic consumption and investments to drive recovery − Slight quarterly economic contraction expected in Key economic indicators Q1 2012, following eurozone’s downturn − Construction accelerated 5.7%* yoy, bolstered by the 8 7.3% 9% infrastructure projects in EUR thousand 6% − Hou
Slide 15: Romania update – Improved NPL coverage ratio
Romania update – Improved NPL coverage ratio − NPL coverage increased to 52.2% from 50.1% as Segment Romania - Migration analysis of Dec 2011 100% 100% 45.7% − Low risk class improved to 45% 43.6% 42.7% 42.2% 45.0% 80% 70.9% 80% 70.7% 69.7% 64.9% 68.2% 60% 60% − NPL ratio rose to 24.3%, affected by
Slide 16: Presentation topics
Presentation topics − Business performance − Update on Hungary & Romania − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure Q1 2012 results 30 April 2012 16 London
Slide 17: Loan book review
Loan book review – Customer loans grew 1.5% year-on-year − Customer loans grew by 1.5% yoy despite Customer loans by main segments * decline in Hungary − Notable growth of retail portfolio in Slovakia and 150 132.8 134.1 135.2 134.7 134.8 corporate business in Austria compensated for 120 18.9 18.7 1
Slide 18: Asset quality review – NPL formation
Asset quality review – NPL formation increased as a result of lower NPL sales − New NPL formation accelerated qoq mainly due to Erste Group: NPL ratio vs NPL coverage lower NPL sales 63.9% − NPL ratio in Hungary increasing due to shrinking portfolio 30% 65% 61.4% 61.9% and difficult economic environ
Slide 19: Asset quality review – Segment round-up
Asset quality review – Segment round-up: HU and RO remained challenging − Retail & SME/Austria: NPL ratio stable NPL ratios in key segments − Stable development in saving banks as well as EBOe − Further reduction of CHF loans due to conversion 25% 24.3% 23.5% into EUR loans 20% − Retail & SME/CEE: D
Slide 20: Asset quality review – Risk costs
Asset quality review – Risk costs increased in Hungary and Romania − GCIB: demand is growing in GLC business Risk costs in key segments − Improved asset quality leading to continuously increasing share of low risk 10% − Defaults in big ticket real estate business led to 8% 7.56% 6.94% increase of ri
Slide 21: Drill-down on selected asset classes
Drill-down on selected asset classes – No meaningful sovereign exposure to peripheral Europe Total net exposure of Erste Group (incl. savings banks) to selected European countries: in EUR million Sovereign Bank Other Total net exposure Dec 10 Dec 11 Mar 12 Dec 10 Dec 11 Mar 12 Dec 10 Dec 11 Mar 12 D
Slide 22: Presentation topics
Presentation topics − Business performance − Update on Hungary & Romania − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure Q1 2012 results 30 April 2012 22 London
Slide 23: Funding update – Strong deposit inflow
Funding update – Strong deposit inflow in Q1 2012 − Customer deposits grew by 2.9% compared to YE 2011 Customer deposit trends by main segments − In Q1 12 most visible inflow in Czech Rep and EBOe − FX effect reversed compared to Q4 11 with CZK and HUF 119.2 120.8 121.5 118.9 122.3 125 strengthening
Slide 24: Funding update – Retail deposits a key pillar
Funding update – Retail deposits remained a key pillar in the funding mix − Short-term funding needs very well covered Evolution of Erste Group's funding mix − Investment in highly liquid assets emphasized by continuously rising collateral coverage of short-term funding needs 100% 3.2% 3.2% 3.0% 3.0
Slide 25: Presentation topics
Presentation topics − Business performance − Update on Hungary & Romania − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure Q1 2012 results 30 April 2012 25 London
Slide 26: Capital position
Capital position – Strongly enhanced capital ratios as of March 2012 − EBA capital ratio of 9.7% as of March 2012 Core tier 1 ratio (total risk) (excluding retained earnings for Q1 2012) − EBA capital ratio adjusted for extraordinary 10.2% 9.2% 9.4% effect in Romania: 9.1% 8.3% − CET1 ratio: 10.2% −
Slide 27: Presentation topics
Presentation topics − Business performance − Update on Hungary & Romania − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure Q1 2012 results 30 April 2012 27 London
Slide 28: Conclusion – Outlook
Conclusion – Outlook − Most of Erste Group's core markets are expected to post economic growth in 2012 − In line with weakening outlook for the euro zone in the second half of 2011 − Austria, Czech Republic and Slovakia are well positioned to weather a potential recession in EU − Hungary: new fiscal
Slide 29: Presentation topics
Presentation topics − Business performance − Update on Hungary & Romania − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure Q1 2012 results 30 April 2012 29 London
Slide 30: Segment review
Segment review – Core segments affected by one-off items Retail & SME GCIB Group Markets Corporate Center Total group in EUR million 1-3 12 1-3 11 1-3 12 1-3 11 1-3 12 1-3 11 1-3 12 1-3 11 1-3 12 1-3 11 Net interest income 1,105.1 1,135.9 128.2 127.7 46.1 24.6 57.5 13.8 1,336.9 1,302.0 Risk provisio
Slide 31: Core segment – Austria
Core segment – Austria EBOe posts another record quarterly net result Savings banks EB Oesterreich Austria in EUR million 1-3 12 1-3 11 1-3 12 1-3 11 1-3 12 1-3 11 Net interest income 240.9 234.1 161.7 152.9 402.6 387.0 Risk provisions for loans and advances (51.3) (62.1) (31.4) (35.0) (82.7) (97.1)
Slide 32: Core segment Central and Eastern Europe (1)
Core segment Central and Eastern Europe (1) – Diverging trends in operating performance … Czech Republic Romania Slovakia Hungary in EUR million 1-3 12 1-3 11 1-3 12 1-3 11 1-3 12 1-3 11 1-3 12 1-3 11 Net interest income 282.6 284.4 153.0 186.0 106.4 109.3 81.7 93.0 Risk provisions for loans and adv
Slide 33: Core segment Central and Eastern Europe (2)
Core segment Central and Eastern Europe (2) – … and risk cost levels across the region continued Croatia Serbia Ukraine CEE in EUR million 1-3 12 1-3 11 1-3 12 1-3 11 1-3 12 1-3 11 1-3 12 1-3 11 Net interest income 64.1 61.3 8.7 8.6 6.0 6.3 702.5 748.9 Risk provisions for loans and advances (32.2) (
Slide 34: Segment Retail & SME
Segment Retail & SME – Positive performance in core business hurt by HU & RO − Operating result down as reduced operating expenses in EUR million 1-3 12 1-3 11 Change did not overcompensate decrease in operating income Net interest income 1,105.1 1,135.9 (2.7%) − Operating income decreased by 2.7% y
Slide 35: Segment Retail & SME – Loan book analysis
Segment Retail & SME – Loan book analysis Segment Retail & SME - Segment Retail & SME - Customer loans by Basel II customer segment Customer loans by currency 113.3 114.8 115.2 114.4 114.4 120 100% 2.0% 2.0% 2.2% 2.2% 2.0% 6.6 6.7 6.3 6.7 6.7 14.3% 14.9% 14.4% 13.7% 13.1% 80% 90 21.6% in EUR billion
Slide 36: Segment GCIB excl IB
Segment GCIB excl IB – Net profit declined on higher risk costs and lower fees − Operating result slightly declined on lower fee 1-3 12 1-3 11 Change in EUR million income − NII was up on increased volume in Group Large Corporate Net interest income 105.4 101.6 3.7% − Fee income decreased on reducti
Slide 37: International Business (GCIB)
International Business (GCIB) – Restructuring of non-core business ongoing − Reduction in business and close-out of CDS portfolio 1-3 12 1-3 11 in EUR million Change visible in International Business Division’s result − Operating income, especially NTR, declined sharply on closed Net interest income
Slide 38: Segment GCIB (incl IB) – Loan book analysis
Segment GCIB (incl IB) – Loan book analysis Segment GCIB - Segment GCIB - Customer loans by currency Customer loans by Basel II customer segment 30 100% 3.7% 1.2% 3.7% 1.2% 3.5% 1.2% 4.5% 1.7% 4.9% 1.6% 5.5% 5.7% 5.7% 5.7% 6.3% 10.2% 10.1% 9.9% 9.3% 8.3% 80% 19.8 19.8 in EUR billion 18.9 18.7 19.3 2
Slide 39: Segment Group Markets
Segment Group Markets – Net profit increased in an improved environment − Operating result improved on increased net interest income in EUR million 1-3 12 1-3 11 Change − NII increased on shifting interest income on trading securities Net interest income 46.1 24.6 87.4% starting in Q4 2011 and on hi
Slide 40: Segment Corporate Center
Segment Corporate Center – Buy-back of own issues drove net profit − What is in the Corporate Center? − Business areas which cannot be allocated to relevant business in EUR million 1-3 12 1-3 11 Change lines, one-offs, amortisation of customer relationships and Net interest income 57.4 13.8 >100.0%
Slide 41: Retail & SME: Austria/EB Oesterreich
Retail & SME: Austria/EB Oesterreich – Positive long term trend continued in Q1 2012 − Operating result increased year-over-year − NII improved on increased deposit volume and fractionally in EUR million 1-3 12 1-3 11 Change higher margins Net interest income 161.7 152.9 5.8% − Customer deposits inc
Slide 42: Retail & SME: Austria/EB Oesterreich – Loan book analysis
Retail & SME: Austria/EB Oesterreich – Loan book analysis Segment EB Oesterreich - Segment EB Oesterreich - Customer loans by Basel II customer segment Customer loans by currency 30 27.1 27.5 28.0 28.2 28.1 100% 1.8% 1.7% 2.0% 1.9% 1.8% 1.7 1.8 1.8 15.4% 16.0% 15.4% 14.4% 14.2% 1.7 1.7 80% in EUR bi
Slide 43: Retail & SME: Austria/Savings banks
Retail & SME: Austria/Savings banks – Solid operating performance − Operating result increased slightly year-on-year − NII up on improved loan and deposit volumes in EUR million 1-3 12 1-3 11 Change − Net fee income mildly decreased yoy mainly on declining Net interest income 240.9 234.1 2.9% securi
Slide 44: Retail & SME: Austria/Savings banks – Loan book analysis
Retail & SME: Austria/Savings banks – Loan book analysis Segment Savings Banks - Customer loans by Basel II customer segment Segment Savings banks - Customer loans by currency 40 37.0 37.7 37.7 37.6 37.4 1.7 1.6 1.6 1.6 1.6 100% 3.2% 3.2% 3.5% 3.4% 3.4% 19.2% 20.1% 19.6% 18.9% 18.5% 30 80% in EUR bi
Slide 45: Retail & SME: Czech Republic
Retail & SME: Czech Republic – Record quarterly net profit in Q1 2012 − Operating result decreased somewhat on lower fee and commission income in 1-3 2012 in EUR million 1-3 12 1-3 11 Change − NII slightly down on currency depreciation but increased in local Net interest income 282.6 284.4 (0.6%) cu
Slide 46: Retail & SME: Czech Republic – Loan book analysis
Retail & SME: Czech Republic – Loan book analysis Segment Czech Republic - Segment Czech Republic - Customer loans by Basel II customer segment Customer loans by currency 20 18.0 18.1 17.9 17.8 17.2 100% 0.2% 3.3% 0.2% 3.3% 0.3% 3.4% 0.3% 3.7% 0.2% 3.4% 0.8 0.8 0.6 0.7 0.7 16 80% in EUR billion 5.5
Slide 47: Retail & SME: Romania
Retail & SME: Romania – Additional risk provisions led to increased coverage ratio − Operating result decreased on lower NII and fee income, but lower costs and strong trading in EUR million 1-3 12 1-3 11 Change mitigated decline in Q1 2012 Net interest income 153.0 186.0 (17.7%) − Decrease in loan
Slide 48: Retail & SME: Romania – Loan book analysis
Retail & SME: Romania – Loan book analysis Segment Romania - Segment Romania - Customer loans by currency Customer loans by Basel II customer segment 15 100% 1.4% 1.3% 1.7% 1.7% 1.7% 12 11.3 11.1 11.0 11.2 11.1 80% in EUR billion 1.5 1.5 1.1 1.3 1.2 60.1% 60.4% 59.9% 60.6% 61.1% 9 60% 4.4 4.3 4.4 4.
Slide 49: Retail & SME: Slovakia
Retail & SME: Slovakia – Continuous solid operating result − Operating result slightly down against strong 1-3 2011 − NII slightly decreased on adjusted investment strategy in EUR million 1-3 12 1-3 11 Change − Fees were stable year-over-year Net interest income 106.4 109.3 (2.7%) − Net trading cont
Slide 50: Retail & SME: Slovakia – Loan book analysis
Retail & SME: Slovakia – Loan book analysis Segment Slovakia - Segment Slovakia - Customer loans by Basel II customer segment Customer loans by currency 8 100% 0.4% 0.4% 0.4% 0.3% 0.1% 6.0 6.2 6.3 5.8 5.9 6 0.1 0.2 0.3 80% in EUR billion 0.1 0.1 1.4 1.4 1.3 1.2 1.4 0.3 0.3 0.3 60% 0.3 0.3 4 99.6% 99
Slide 51: Retail & SME: Hungary
Retail & SME: Hungary – Unorthodox policies still affecting EB Hungary’s result − Operating result held up despite decreasing revenues on cost cutting efforts; currency adjusted up 5.3% yoy in EUR million 1-3 12 1-3 11 Change − NII declined on portfolio reduction as effect of FX conversion Net inter
Slide 52: Retail & SME: Hungary – Loan book analysis
Retail & SME: Hungary – Loan book analysis Segment Hungary - Segment Hungary - Customer loans by currency Customer loans by Basel II customer segment 10 100% 0.3% 0.1% 0.1% 0.2% 0.2% 7.9 20.7% 19.7% 20.5% 22.0% 22.3% 7.6 7.7 8 0.4 0.4 0.4 7.1 6.9 80% in EUR billion 0.4 0.4 2.3 2.3 2.3 6 2.1 2.1 60%
Slide 53: Retail & SME: Croatia
Retail & SME: Croatia – Solid operating result impaired by increase in risk costs − Operating result improved on higher NII 1-3 2012 − NII improved mainly on increased financial assets in EUR million 1-3 12 1-3 11 Change − Lower fee income due to transfer of credit card processing Net interest incom
Slide 54: Retail & SME: Croatia – Loan book analysis
Retail & SME: Croatia – Loan book analysis Segment Croatia - Segment Croatia - Customer loans by currency Customer loans by Basel II customer segment 5.8 5.8 5.9 6.0 6 5.6 100% 0.2% 0.2% 0.3% 0.3% 0.2% 0.5 0.6 0.7 0.7 13.6% 13.0% 12.8% 0.5 14.1% 14.2% 80% in EUR billion 4 2.4 2.5 2.4 2.5 2.5 60% 65.
Slide 55: Retail & SME: Serbia
Retail & SME: Serbia – Operating performance improved significantly yoy − Operating result up on higher net fee income and upbeat trading result in EUR million 1-3 12 1-3 11 Change − NII up on loan and deposit growth Net interest income 8.7 8.6 1.2% − Margins in retail business developed positively
Slide 56: Retail & SME: Serbia – Loan book analysis
Retail & SME: Serbia – Loan book analysis Segment Serbia - Segment Serbia - Customer loans by currency Customer loans by Basel II customer segment 600 100% 1.0% 4.1% 0.9% 4.1% 0.9% 3.9% 0.9% 3.8% 0.9% 3.8% 461.7 480.3 485.6 482.4 436.0 2.2 2.5 2.8 3.4 80% in EUR million 2.2 400 274.9 286.5 277.9 60%
Slide 57: Retail & SME: Ukraine
Retail & SME: Ukraine – Rightsizing still ongoing − Operating result down on weak trading in 1-3 2012 in EUR million 1-3 12 1-3 11 Change − NII down on higher funding costs and lower income on financial Net interest income 6.0 6.3 (4.8%) assets − Net fee income improved marginally on the back of inc
Slide 58: Retail & SME: Ukraine – Loan book analysis
Retail & SME: Ukraine – Loan book analysis Segment Ukraine - Segment Ukraine - Customer loans by currency Customer loans by Basel II customer segment 800 100% 1.4% 1.3% 1.2% 1.5% 1.8% 600 80% in EUR million 479.0 496.7 443.7 441.1 0.0 3.2 50.3 440.3 73.0% 0.0 51.0 60% 80.2% 80.2% 75.6% 0.0 3.0 84.3%
Slide 59: Presentation topics
Presentation topics − Business performance − Update on Hungary & Romania − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure Q1 2012 results 30 April 2012 59 London
Slide 60: Asset quality analysis – Key definitions
Asset quality analysis – Key definitions − Key asset quality indicators are based Risk category Agency ratings on on-balance sheet customer loans Low risk AAA to BB / Aaa to Ba − Reported NPL and NPL coverage ratios Management attention B exclude collateral Substandard CCC to C / − Broad NPL definit
Slide 61: Asset quality analysis – Loan book overview
Asset quality analysis – Loan book overview Customer loans by Basel II customer segments Customer loans by industries 150 132.8 134.1 135.2 134.7 134.8 5.9% 3.1% 3.9% 7.7 7.8 7.6 8.2 8.0 120 2.8% in EUR billion 62.4 5.1% 38.7% 61.0 61.0 62.1 62.5 90 5.1% 60 13.4 13.4 13.4 13.2 13.0 30 4.8% 50.7 51.9
Slide 62: Asset quality analysis – Loan book by segments
Asset quality analysis – Loan book by segments Low risk Mgmt attention Substandard Non-performing Total loan book Risk provisions NPL coverage NPL ratio Mar 12 Dec 11 Mar 12 Dec 11 Mar 12 Dec 11 Mar 12 Dec 11 Mar 12 Dec 11 Mar 12 Dec 11 Mar 12 Dec 11 Mar 12 Dec 11 Retail & SME 81,513 80,952 18,798 1
Slide 63: Asset quality analysis – Loan book by region
Asset quality analysis – Loan book by region (country of origination) Low risk Mgmt attention Substandard Non-performing Total loan book in EUR million Mar 12 Dec 11 Mar 12 Dec 11 Mar 12 Dec 11 Mar 12 Dec 11 Mar 12 Dec 11 Share of total Share of total Core market 90,019 89,007 20,959 21,768 3,968 4,
Slide 64: Total exposure by region – Mar 12
Asset quality analysis – Total exposure by region (country of origination) Mar 12 Management Non- Credit risk Low risk Substandard in EUR million attention performing exposure Core market 154,217 24,605 4,742 11,259 194,822 Austria 81,781 9,424 1,676 3,272 96,153 Croatia 6,229 2,269 436 1,066 10,000
Slide 65: Total exposure by region – Dec 11
Asset quality analysis – Total exposure by region (country of origination) Dec 11 Management Non- Credit risk Low risk Substandard in EUR million attention performing exposure Core market 142,947 25,055 4,889 10,822 183,714 Austria 76,513 9,114 1,686 3,316 90,629 Croatia 5,954 2,417 466 982 9,818 Ro
Slide 66: Asset quality analysis – Financial assets
Asset quality analysis – Financial assets Financial assets by country of origination Financial assets by currency (31 Mar 2012: EUR 39.6 bn) (31 Mar 2012: EUR 39.6 bn) 1.3% 13.9% 5.5% 2.6% 2.0% 27.0% 3.9% 3.5% 8.5% 4.1% 22.2% 5.1% 62.3% 23.0% 3.5% 11.6% AT CZ SK US DE HU RO IT GB Other EUR CZK USD H
Slide 67: Trading assets as of 31 Mar 2012
Balance sheet (IFRS) drill-down – Trading assets as of 31 Mar 2012 − YTD rise in trading assets mainly due to short term T-bill investments in HU in EUR m Sovereign Banks Other Total Trading CZ 1,581 22.8% 5 0.8% 4 0.8% 1,590 19.6% SK 626 9.1% 0 0.0% 0 0.0% 626 7.7% RO 658 9.5% 2 0.3% 1 0.1% 660 8.1
Slide 68: Financial assets at fair value
Balance sheet (IFRS) drill-down – Financial assets at fair value as of 31 Mar 2012 − Decline due to the reduction in non-core assets in EUR m Sovereign Banks Other Total FV CZ 117 29.7% 169 35.3% 15 4.4% 301 24.7% SK 49 12.4% 1 0.2% 8 2.3% 58 4.8% RO 6 1.5% 0 0.0% 5 1.3% 10 0.8% HU 111 28.1% 0 0.0%
Slide 69: Financial assets available for sale
Balance sheet (IFRS) drill-down – Financial assets available for sale as of 31 Mar 2012 − Investment of surplus liquidity mainly in Austria, Slovakia, Czech Republic and in preparation for Basel 3 liquidity requirements in EUR m Sovereign Banks Other Total AfS CZ 1,265 10.7% 226 4.4% 113 2.4% 1,604
Slide 70: Financial assets held-to-maturity
Balance sheet (IFRS) drill-down – Financial assets held-to-maturity as of 31 Mar 2012 − Investment of surplus liquidity mainly in Czech Republic, Austria, Slovakia, and Romania; preparation for Basel 3 liquidity requirements in EUR m Sovereign Banks Other Total HTM CZ 6,885 46.8% 282 14.2% 25 2.6% 7
Slide 71: Off-balance sheet items
Off-balance sheet items – Exclusively related to customer business in EUR million Mar 2012 Dec 2011 Guarantees and warranties 6,842 6,920 of which: in relation to corporate business 6,084 6,170 Undrawn lines, loan commitments, promissory nots 18,570 18,579 of which: in relation to corporate business
Slide 72: Presentation topics
Presentation topics − Business performance − Update on Hungary & Romania − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure Q1 2012 results 30 April 2012 72 London
Slide 73: Key local entity data – Ceska sporitelna
Key local entity data (IFRS, consolidated) – Ceska sporitelna Key figures and ratios 1-3 12 1-3 11 Rate and margin environment Cost/income ratio 40.8% 41.5% Return on equity 21.6% 21.0% 80% 71.9% 69.8% 8% Mar 12 Dec 11 Change 66.5% 67.3% 67.3% Erste Group stake 97.99% Solvency ratio 13.4% 13.1% 60%
Slide 74: Key local entity data – BCR
Key local entity data (IFRS, consolidated) – BCR Key figures and ratios 1-3 12 1-3 11 Rate and margin environment Cost/income ratio 40.8% 42.3% Return on equity (16.4% ) 4.3% 150% 137.4% 134.1% 135.5% 134.6% 136.2% 15% Mar 12 Dec 11 Change Erste Group stake 92.45% 12% Solvency ratio 11.8% 12.7% 100%
Slide 75: Key local entity data – Slovenska sporitelna
Key local entity data (IFRS, consolidated) – Slovenska sporitelna Key figures and ratios 1-3 12 1-3 11 Rate and margin environment Cost/income ratio 40.6% 38.9% Return on equity 19.0% 21.3% 100% 8% Mar 12 Dec 11 Change 83.4% 83.6% 75.5% 77.3% 77.9% Erste Group stake 100.0% 100.0% 80% Solvency ratio
Slide 76: Key local entity data – Erste Bank Hungary
Key local entity data (IFRS, consolidated) – Erste Bank Hungary Key figures and ratios 1-3 12 1-3 11 Rate and margin environment Cost/income ratio 35.3% 40.7% Return on equity n.a. (17.2% ) 270% 12% Mar 12 Dec 11 Change Erste Group stake 99.94% 184.4% 191.8% 10% 177.6% 177.5% 177.6% Solvency ratio 1
Slide 77: Key local entity data – Erste Bank Croatia
Key local entity data (IFRS, consolidated) – Erste Bank Croatia Key figures and ratios 1-3 12 1-3 11 Rate and margin environment Cost/income ratio 39.2% 39.3% Return on equity 9.2% 9.1% 180% 6% 148% 150% 154% Mar 12 Dec 11 Change 145% 150% 131% Erste Group stake 69.25% 4.1% 4.1% 3.8% 3.9% 3.9% Solve
Slide 78: Key local entity data – Erste Bank Serbia
Key local entity data (IFRS, consolidated) – Erste Bank Serbia Key figures and ratios 1-3 12 1-3 11 Rate and margin environment Cost/income ratio 63.2% 68.7% Return on equity 8.5% 5.1% 120% 103.8% 105.3% 20% Mar 12 Dec 11 Change 99.2% 96.7% 100.4% Erste Group stake 80.49% 100% Solvency ratio 24.3% 2
Slide 79: Key local entity data – Erste Bank Ukraine
Key local entity data (IFRS, consolidated) – Erste Bank Ukraine Key figures and ratios 1-3 12 1-3 11 Rate and margin environment Cost/income ratio 100.8% 82.7% Return on equity na 4.1% 500% 25% Mar 12 Dec 11 Change 20.3% Erste Group stake 100.0% 400% 20% 324% Solvency ratio 24.0% 22.0% 300% 263% 262
Slide 80: Presentation topics
Presentation topics − Business performance − Update on Hungary & Romania − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure Q1 2012 results 30 April 2012 80 London
Slide 81: Strategy – A real customer need is the reason for all business
Strategy – A real customer need is the reason for all business Customer banking in Central and Eastern Europe Eastern part of EU Focus on CEE, limited exposure to other Europe Retail Corporate Capital Public Interbank banking banking markets sector business Focus on local Large, local corporate Focu
Slide 82: Strategy – Customer banking in the eastern part of the EU
Strategy – Customer banking in the eastern part of the EU Erste Group Slovakia Czech Republic Clients: 2.4m The leading retail bank with 16.9 m customers Clients: 5.2m Retail loans: 26.4% One of the leading corporate banks Retail loans: 24.2% Retail dep.: 25.7% Retail dep.: 28.3% Branches: 292 Stron
Slide 83: Erste Group's intangible asset split
Erste Group’s intangible asset split – BCR goodwill remains single biggest intangible Intangibles composition 6 5 4.7 4.6 in EUR billion 0.6 0.6 4 0.4 0.4 3.5 3.5 3.5 0.3 0.3 0.6 0.6 0.6 3 0.5 0.5 0.3 0.3 0.3 0.5 0.5 0.0 0.0 0.0 2 0.3 0.3 0.5 0.5 0.5 0.4 0.4 0.4 0.3 0.3 0.3 1 1.9 1.8 1.1 1.1 1.1 0 Q
Slide 84: Historic financials – Quarterly income statement
Erste Group historic financials – Quarterly income statement (IFRS) in EUR million Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Net interest income 1,330.3 1,368.0 1,397.5 1,343.4 1,302.0 1,401.9 1,430.2 1,434.9 1,336.9 Net fee and commission income 448.1 469.5 452.4 472.5 455.2 450.9 445.9
Slide 85: Historic financials – Quarterly balance sheet
Erste Group historic financials – Quarterly balance sheet (IFRS) in EUR million Mar 10 Jun 10 Sep 10 Dec 10 Mar 11 Jun 11 Sep 11 Dec 11 Mar 12 Cash and balances with central banks 5,965 6,540 5,030 5,839 5,043 6,605 5,743 9,413 5,480 Loans and advances to credit institutions 16,123 16,408 14,464 12,
Slide 86: Quarterly segment reporting – Overview of main segments
Quarterly segment reporting – Overview of main segments in EUR million Retail & SME Group Corporate & Investment Banking Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Net interest income 1,135.9 1,190.8 1,212.6 1,177.0 1,105.1 127.7 134.1 132.2 149.2 128.2 Risk provisions (404.2) (404.
Slide 87: Quarterly segment reporting – Austria sub-segments
Quarterly segment reporting – Austria sub-segments in EUR million Erste Bank Oesterreich Savings Banks Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Net interest income 152.9 168.6 180.3 164.1 161.7 234.1 258.1 249.8 273.6 240.9 Risk provisions (35.0) (30.2) (27.5) (8.7) (31.4) (62.1)
Slide 88: Quarterly segment reporting – CEE sub-segments (1)
Quarterly segment reporting – Central and Eastern Europe sub-segments (1) in EUR million Czech Republic Romania Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Net interest income 284.4 305.6 310.3 283.0 282.6 186.0 168.9 162.7 154.7 153.0 Risk provisions (70.9) (68.4) (49.3) (21.9) (44.
Slide 89: Quarterly segment reporting – CEE sub-segments (2)
Quarterly segment reporting – Central and Eastern Europe sub-segments (2) in EUR million Croatia Serbia Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Net interest income 61.3 66.6 66.8 67.1 64.1 8.6 9.6 8.9 9.3 8.7 Risk provisions (23.2) (27.2) (21.9) (37.0) (32.2) (2.0) (2.5) (1.8) (3
Slide 90: Group statistical data
Group statistical data – Expansion slowed, but long term growth trend intact in EUR million 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Mar 12 Tier 1 Capital pursuant to Austrian Banking Act 1,753 2,125 2,337 3,800 3,912 4,377 5,112 6,185 6,674 7,448 11,450 12,219 11,909 12,200
Slide 91: Presentation topics
Presentation topics − Business performance − Update on Hungary & Romania − Credit risk − Funding − Capital − Outlook − Appendix − Segments − Asset quality − CEE local consolidated results − About Erste Group − Shareholder structure Q1 2012 results 30 April 2012 91 London
Slide 92: Shareholder structure
Shareholder structure – Total number of shares: 394,568,647 By investor By region CaixaBank Other 9.7% Erste 2.7% Stiftung Continental 24.8% Europe 24.7% Austria 47.3% Savings banks 4.1% UK & Ireland Employees 5.6% 2.1% Institutional Retail Investors Investors 54.2% 5.2% North America 19.7% Free flo
Slide 93: Investor relations contacts
Investor relations contacts − Erste Group Bank AG, Graben 21, 1010 Vienna Fax +43 (0)5 0100-13112 E-mail: investor.relations@erstegroup.com Internet: www.erstegroup.com Reuters: ERST.VI Bloomberg: EBS AV Datastream: O:ERS ISIN: AT0000652011 − Investor relations Thomas Sommerauer Tel: +43 (0)5 0100 1