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

Banca Monte Dei Paschi Di Siena — Q1 2011 Earnings Presentation

43 slides from Banca Monte Dei Paschi Di Siena's earnings presentation, May 12, 2011

  1. Slide 1: 1Q 2011 Results Presentation

    “1Q 2011 Results Presentation” Siena, 12th May 2011

  2. Slide 2: 1Q2011 Results Highlights

    1Q2011 Results Highlights  c.22,000 net new customers in 3M (+c.1,000 vs 1Q10); c.18,000 net new current account (vs c.7,200 new current accounts opened in 2010)  Retention rate at 98.8% vs 95.3% at Dec 10  Total Funding: around +5 €bn in 1Q vs Dec10; Direct Funding: +5.0% YoY and Loans +4.2% YoY

  3. Slide 3: 1Q11 Results

    1Q11 Results 1Q11 P&L (mln €) 1Q11 1Q10* 1Q11/1Q10* 4Q10* Net Interest Income 877.7 871.7 +0.7% 900.8 Net Fees 472.7 480.5 -1.6% 489.0 Basic income 1,350.4 1,352.1 -0.1% 1,389.8 Dividends 27.4 14.4 +89.9% 32.2 Trading 103.9 19.7 n.m. -5.7 Total Revenues 1,482.6 1,392.9 +6.4% 1,406.2 Operating Costs

  4. Slide 4: 1Q11 Results: first steps towards the 2015 Ambition (1/3)

    1Q11 Results: first steps towards the “2015 Ambition” (1/3) Product Companies* contribution Net Operating Profit (YoY increase) 37% 101% 92% 23% 86% 12% 2007 2010 1Q11 MPS CS Consum.it MPS L&F AXA MPS, Prima Sgr and B.U. Financial Advisors Contribution** 86 70 € mln 1Q10 1Q11 Antonveneta Direct Fund

  5. Slide 5: 1Q11 Results: first steps towards the 2015 Ambition (2/3)

    1Q11 Results: first steps towards the “2015 Ambition” (2/3) Operating Costs evolution Cost/Income 979,6 67.2% 64.7% 905,1 61,6% 857,8 855,2 57,7% € mln 2008 Quarterly 2009 Quarterly 2010 Quartely 1Q11 avg* avg avg 2008* 2009 2010 1Q11  L/D ratio now at 0.96x (0.99x in Dec 2010)  Financial assets (

  6. Slide 6: 1Q11 Results: first steps towards the 2015 Ambition (3/3)

    1Q11 Results: first steps towards the “2015 Ambition” (3/3) Tier 1 c.40bps 9.5% c.40bps c.20bps c.13bps 9.1% 8.4% 2010 Goodwill filter RWA Retained 1Q11 RE benefit* 1Q11 including optimization earnings RE benefit  Tier 1 at 9.1% (+70bps vs December 2010)  Tier 1 at 9.5% considering Real Estate dea

  7. Slide 7: Business & Market

    Business & Market Total funding Good funding and lending and strong attention to our customer base +5 €bn  Good funding and lending: Total Funding +7.0% YoY (o/w Direct 303 308 Funding +5.0% YoY) and Total lending +4.2% YoY 284  Strong focus on our customer base: around +22,000 net new customers i

  8. Slide 8: Funding and lending volumes

    Funding and lending volumes Direct Funding Direct Funding Market Shares** +5.0% +34bps +1.2% +9bps 160,4 158,5 152,7 7,23% 7,32% 6,98% € bn Mar-10* Dec-10 Mar-11 Mar-10 Dec-10 Mar-11 Total Lending Total Lending Market Shares +4.2% -11bps -1.0% -5bps 156,2 154,7 148,5 7,59% 7,52% 7,48% € bn Mar-10* D

  9. Slide 9: Specialized Product Flows

    Specialized Product Flows Lending flows MPS Capital Services Disbursements +87.4% -59% +43% +22.5% 4.582 4.047 731 2.826 597 1.864 1Q10 390 1Q11 € mln € mln Mortgages Specilised credit and 1Q10 4Q10 1Q11 corporate financial products Leasing Flows & Turnover Factoring Consumer Credit Flows +51.7% -2.

  10. Slide 10: Increasing customer base

    Increasing customer base High Value-Added Services Financial Advisory Financial Advisory Services: Customers Services: Assets 162 28,1 144 25,2 82 14,8 /000 €bn 2009 2010 1Q11 2009 2010 1Q11 Retention rate Acquisition Rate 98,8% 95,3% 94,1% 6.0%* 5,8% 5,7% 2009 2010 1Q11 2009 2010 1Q11 * Annualized

  11. Slide 11: An Analysis of Revenues

    An Analysis of Revenues Resilient revenues with a strong contribution from product companies Total Revenues  Total Revenues: +6.4% YoY and +6.4% vs 2010 quarterly avg +6.4%  NII +0.7% YoY; QoQ trend negatively impacted by fewer 1.482,6 working days (c20 €mln) and by reduction of ALCO components 1.

  12. Slide 12: A focus on Net Interest Income

    A focus on Net Interest Income Net Interest Income +0.7% -2.2% 871,7 897,9 877,7 € mln 1Q10* 2010 Quartely avg 1Q11 1Q11 vs 4Q10 4.4 €bn Govies 900,8 23 portfolio reduction 877,7 -20 -26 € mln 4Q10 Fewer Working days Commercial Spread and Finance contribution 1Q11 Volumes effects * Excluding contrib

  13. Slide 13: Mark up and Mark down

    Mark up and Mark down Short term Mark up  Consumer Mark up: -2bps vs Dec 2010  Corporate Mark up: +19bps vs Dec 2010 Market* MPS Short term Mark down  Consumer Mark down: +17bps vs Dec 2010  Corporate Mark down: -14bps vs Dec 2010 Market* MPS * Bank of Italy matrix pag. 13

  14. Slide 14: Funding: focus on new bond issues and CDS trend

    Funding: focus on new bond issues and CDS trend Customer rate % (fixed) CDS: MPS vs Avg Italian Banks 400 350 4,0 Customer rate 300 250 3,0 200 150 2,0 2y 5y 6y 100 gen-11 feb-11 mar-11 apr-11 mag-11 Amount (size= €500mln) BMPS new Retail Bond issue Govies Btp BMPS Average Italian Banks Rating evolu

  15. Slide 15: ALM Rebalancing

    ALM Rebalancing Interbank Position * Loan/Deposit ratio -37.5% 1,02 0,98 0,99 0,96 € bn -9,6 2008 2009 2010 Mar-11 -15,4 2010 1Q11 Financial Assets (including Repos) Shareholders' Equity -16.1% +2.0% 56,0 46,9 17,5 17,2 € bn € bn 2010 1Q11 2010 1Q11 * Loans and advances to banks’ and ‘deposits from

  16. Slide 16: Trading/valuation of financial assets

    Trading/valuation of financial assets Trading/valuation of financial assets 104 20 € mln -6 Bond Portfolio: 1Q10* 2010 Quartely avg 1Q11 c -4.4 €bn since Dec 2010  HFT: -3.7 €bn  AFS: -0.2 €bn  L&R: -0.5 €bn Trading/valuation of financial assets: breakdown 60 -20 104 64 € mln MPS Capital Services

  17. Slide 17: A focus on fees

    A focus on fees Fees -1.6% -1.1% 480,5 477,9 472,7 € mln 1Q10* 2010 Quartely avg 1Q11 Fees: Breakdown 8,7% 1,7% -1,6% -2.7% -5,5% -12,1% Total Fees Continuing AuM Placing Other Credit Fees Other Traditional A.U.M. banking fees fees * Excluding contribution from branches sold and from MP Monaco SAM a

  18. Slide 18: Dividends from product companies

    Dividends from product companies Dividends +90% +19% 27,4 23,0 14,4 € mln 1Q10* 2010 Quartely avg 1Q11 Bancassurance contribution +349% 47% 23,1 15,7 5,2 € mln 1Q10 2010 Quartely avg 1Q11 * Excluding contribution from branches sold and from MP Monaco SAM and MPS Venture under disposal pag. 18

  19. Slide 19: Operating costs

    Operating costs Operating costs Efficiency improvement continues  C/I at 57.7% vs 61.6% Dec 10 +1.1%  Cost of personnel: -2.6% YoY, -9.0% -0.3% QoQ, positively affected by HR restructuring initiatives implemented 857,8 855,2  Other Admin Expenses (+9.0% YoY, 846,1 -0.4% QoQ) negatively affected b

  20. Slide 20: A focus on Operating costs

    A focus on Operating costs Operating Costs evolution 979,6 905,1 857,8 855,2 € mln  Costs reduced as a result 2008 Quarterly 2009 Quarterly 2010 Quartely avg 1Q11 of implemented avg* avg headcount reduction and redeployment processes Cost/Income 67.2% 64.7% 61,6% 57,7% 2008* 2009 2010 1Q11 * Pro fo

  21. Slide 21: Personnel costs and Other Admin Expenses

    Personnel costs and Other Admin Expenses Personnel Expenses -2.6% -1.7%  90 net outflows in 1Q11 558,1 552,8 543,5 € mln 1Q10* 2010 Quartely avg 1Q11 Other Administrative Expenses +9.0% +3.4%  The increase is due to the impact from RE deal; without 247,9 261,2 270,2 which the item would decrease €

  22. Slide 22: Outlook on Personnel and Other Admin Expenses

    Outlook on Personnel and Other Admin Expenses Group Headcount 130  Expected in 2011: -1.3% reduction of total workforce -90 Up to -300 net outflows 1Q11 net outflows expected new hiring from 2Q11 to 4Q11 Savings expected on Other Admin. Expenses € mln  Revision of internal processes  Savings on I

  23. Slide 23: Asset Quality

    Asset Quality Asset quality in control: Net adjustments for impairment of loans  Cost of credit at 71bps (vs74bps -10.5% as at Dec 2010), with increased NPL coverage (+20bps vs 2010) -4.9%  Decreasing Impaired loan 307,0 288,9 inflows: NPL inflows -13% YoY, 274,6 Watchlist inflows -5% YoY € mln 

  24. Slide 24: Provisions towards a normalised level

    Provisions towards a normalised level Provisions (bps) -12bps 98 -3bps 83 74 71 Dec-09* Mar-10* Dec-10 Mar-11 Breakdown by Business Units (bps) -15bps QoQ 317 -3bps stable QoQ +1bps -15bps -29bps -9bps QoQ QoQ QoQ QoQ QoQ 71 47 71 67 50 36 GMPS BMPS BAV MPS Capital MPS L&F Consum.it Biverbanca Servi

  25. Slide 25: Trend on NPL and Watchlist inflows and coverage

    Trend on NPL and Watchlist inflows and coverage NPL Inflows NPL coverage +40bps -13% +20bps -5% 597 56,0% 56,0% 56,2% 55,8% 550 520 € mln 1Q10 2010 Quarterly avg 1Q11 Dec-09 Mar-10 Dec-10 Mar-11 Watchlist Inflows Watchlist coverage -5% +170bps -29% 522 -30bps 392 372 21,1% 20,8% 19,6% 19,1% € mln 1Q

  26. Slide 26: Reduction in Impaired Loan

    Reduction in Impaired Loan Market share of Performing and Non Performing Loans * +9bps Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 giu-10 Sep-10 Dec-10 Mar-11 Delta of Performing Loan Market Share Delta of NPL Market Share -594bps Impaired loans  Market share on NPL down a (€ mln) Gross Net further 2

  27. Slide 27: The value of diversification

    The value of diversification The Group managed to deliver a strong operational rebound thanks to: Net Operating Income  Antonveneta: pick up in funding and lending: Direct Funding +11% YoY; loans +4.5% YoY  MPS Capital Services: strong increase in +45.8% disbursements (+87% YoY), with a 92% YoY in

  28. Slide 28: A focus on MPS Capital Services

    A focus on MPS Capital Services Net Operating Income Basic Income Net Profit from trading +92.3% +4.8% +113% 97,8 80,6 64,0 50,8 76,9 30,1 € mln € mln € mln 1Q10 1Q11 1Q10 1Q11 1Q10 1Q11 Cost/Income Net Income -970bps +112% 23,6% 54,4 13,9% 25,7 € mln 2010 1Q11 1Q10 1Q11 pag. 28

  29. Slide 29: A focus on MPS Leasing & Factoring

    A focus on MPS Leasing & Factoring Net Operating Income Basic Income Revenues +86% +12.3% +30% 31,4 28,0 19,2 9,4 14,8 5,0 € mln € mln € mln 1Q10 1Q11 1Q10 1Q11 1Q10 1Q11 Cost/Income Net Income -150bps +142% 32,6% 4,4 31,2% 1,8 € mln 2010 1Q11 1Q10 1Q11 pag. 29

  30. Slide 30: A focus on MPS Consum.it

    A focus on MPS Consum.it Consumer Credit Stock €6.4bn Net Operating Income Basic Income Specific- purpose loans 59% +101% +7.5% Cards 17,8 82,9 5% Personal loans 8,9 77,1 7% Fifth of salary 29% backed loans € mln € mln 1Q10 1Q11 1Q10 1Q11 Cost income Net Income -262bps +273% 21,0% 13,4 18,4% 3,6 € m

  31. Slide 31: Recovering profitability

    Recovering profitability Direct Funding* Loans* +4.5% +11% -0.7% +2.3% 12.886 12.796 12.242 11.640 11.378 10.482 € mln € mln Mar 10 Dec 10 Mar 11 Mar 10 Dec 10 Mar 11 Net Operating Income Cost of credit (bps) +54.2% -9bps 94 38,4 24,9 56 47 € mln 1Q10 1Q11 2009 2010 1Q11 * Restated figures about com

  32. Slide 32: Bancassurance and Asset Management Contribution

    Bancassurance and Asset Management Contribution Bancassurance Fees and Dividends from AXA MPS and Prima Sgr Index and Unit linked +8.7% 83 84 71 758 +42.5% 1.422 381 824 405 296 € mln € mln 1Q10 4Q10 1Q11 1Q10 4Q10 1Q11 Traditional Policies Index Linked and Unit Linked Pension products* P&C* PAC* 4,

  33. Slide 33: Risk and Capital Management

    Risk and Capital Management Monitoring of capital and liquidity position:  Loan/Deposit ratio down at 0.96 Capital generation (bps)*  Counterbalancing capacity: €10.3bn 70 280 in April 2011 130  Tier 1 Ratio at 9.1% (+70bps vs 80 December 2010)  Organic capital generation 2008-2009 2009-2010 1Q1

  34. Slide 34: 2011 funding needs covered

    2011 funding needs covered Maturity of Institutional Bonds from 2011 (€bln) Covered Senior Subordinated Total Bonds 2011 2.9 - - 2.9  Completed 2012 4.6 0.5 - 5.1 2013 1.1 0.9 1.3 3.3 2014 2.0 - - 2.0 2015 0.5 0.1 1.0 1.6 2016 - 1.2 1.3 2.5 CD Programme and Free Counterbalancing Capacity* 15.000 Co

  35. Slide 35: Tier 1

    Tier 1 Main Tier 1 Items (%) 9.5% c.13bps c.40bps c.20bps 9.1% 8.4% c.40bps 2010 Goodwill filter RWA Retained 1Q11 RE benefit* 1Q11 including optimization earnings RE benefit 6th June: Extraordinary shareholders meeting to approve capital increase * Subject to Regulatory approval pag. 35

  36. Slide 36: 1Q2011 results are the first step for full delivery of 2010-2015 Business Plan

    1Q2011 results are the first step for full delivery of 2010-2015 Business Plan:  Strong revenue improvement driven by revenue diversification  Upturn in core earnings expected thanks to new Capital and ALM structure  Cost under control, with full delivery of Phase 2 of restructuring plan starting

  37. Slide 37: Thank you for your attention - Q&A

    Thank you for your attention Q&A pag. 37

  38. Slide 38: pag. 38

    pag. 38

  39. Slide 39: Financial assets

    Financial assets GMPS Securities and Derivatives Portfolio Market Value (€ mln) 31 Mar 2011 In Q1 2011 the Group’s trading book saw a 4.4 €bln decrease primarily concentrated in the HFT component, HFT 06,464 due to Government bond maturities and value AFS 21,642 realised from capital gain-generating

  40. Slide 40: A focus on BMPS institutional funding

    A focus on BMPS institutional funding Issuance and Maturities of Senior and Subordinated Notes in 2010 and in 2011 Lower Tier 2 Covered Bond Senior RMBS 1.750 1.250 1.250 1.000 1.000 1.000 1.000 500 350 150 € mln -350 -600 -1.000 Feb Apr Jun Jun Aug Sept Sept Sept Oct Nov Feb Mar Mag 2010 2011 LT2 C

  41. Slide 41: Contacts

    Contacts Declaration of the Financial Reporting Officer Strategic Planning, Research & Pursuant to para. 2, article 154- bis of the Consolidated Law on Investor Relations Finance, the Financial Reporting Alessandro Santoni (Head) Officer, Mr. Daniele Bigi, declares that the accounting information Pi

  42. Slide 42: Disclaimer

    Disclaimer This document has been prepared by Gruppo Monte dei Paschi di Siena solely for information purposes and for use in presentations of the Group’s financials. No representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, comple

  43. Slide 43: .% DEI PASCHI

    .% DEI PASCHI I SIENA ==” BANCA DAL 1472 www.mps.it

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