Eurobank S.A. · ATHEX:EUROB
Eurobank — Eurobank EFG — H1 2009 Earnings Presentation
30 slides from Eurobank's earnings presentation, Aug 27, 2009
Slide 1: First Half 2009 Results
SW-EUB022-2007-03-19-CMD-V7 August 27, 2009 First Half 2009 Results
Slide 2: Macroeconomic environment still challenging - signs of stabilization
Page 2 Macroeconomic environment still challenging - signs of stabilization New Europe: handles external shocks Greece: Positive factors in 2009… … GDP growth declines substantially slower than EU -16 Policy actions & international initiatives create more Greece a relatively closed economy
Slide 3: Further improvement of pre-provision profit in Q2 – mainly from organic sources
Further improvement of pre-provision profit Page 3 in Q2 – mainly from organic sources 2Q 09 net profit at €88m +21% up 9% qoq +7% despite a 40% qoq decrease 7 in non-core income -27 389 46 -0.5 +13% 363 Organic profits almost doubled qoq, reaching €61m in 2Q 09 39 321* 2Q 09 pre-provision p
Slide 4: Asset quality evolution
Page 4 Asset quality evolution NPL Ratio (% of loans) 4.17% Impairment charges 3.23% 4.08% 209 3.02% 189 2.76% 2.74% NPL coverage 66% 167 2.40% 2.45% Group 3.01% 287 107 107 112 263 2.06% Cost of risk (bps) New Europe 233 1.30% 1.30% 151 FY 05 FY 06 FY 07 1Q 08 FY 08 1Q 09 2Q 09 Impairment charge 13
Slide 5: Selective loan growth; Strong deposit gathering; Improved liquidity position
Selective loan growth; Strong deposit Page 5 gathering; Improved liquidity position Loan growth supported by strong deposit Loans-to-deposits ratio evolution gathering +2.7bn +3.2bn New Europe 171.7 53.8 56.4 167.9 165.3 155.5 14.2 47.0 +8% 143.2 13.2 43.8 126.2 125.5 New 122.4 119.9 Group Europe 11
Slide 6: Strong capital base supported organically
Page 6 Strong capital base supported organically Reduced risk in spite of growing loan book Capital Adequacy FY 08 (%) 1Q 09* 1H 09 July 09 Equity Tier I ratio 7.1% 7.4% 8.0% 8.1% (Core Tier 1 less goodwill) €3.6bn €3.8bn €3.8bn Core Tier I ratio 8.0% 8.6% 9.2% 9.3% €4.2bn €4.3bn €4.4bn Total Tier 1
Slide 7: Financial Review
Page 7 Financial Review 7
Slide 8: Loan NII at record highs – deposit margin on the road to recovery
Loan NII at record highs – deposit margin Page 8 on the road to recovery NII quarterly evolution NII practically flat yoy 621 608 590 590 560 566 544 517 -1.9% 1,156 1,134 482 580 564 Total NII 445 497 457 404 417 382 342 352 322 Loan margin 11 13 17 3 7 4 5 Interest rate gapping 10 -13 -7 Capital &
Slide 9: NIM recovers gaining 18bps qoq
Page 9 NIM recovers gaining 18bps qoq Evolution of Greek spreads (%) New Europe NIM 4Q 08 1Q 09 2Q 09 NIM per country (%) FY 08 1Q 09 1H 09 Sight & Savings Accounts 1.68 -0.06 -0.24 Romania 4.73 4.53 4.23 Time & Client EMTNs -0.41 -1.02 -0.90 Bulgaria 4.40 3.56 3.95 Total Deposits 0.05 -0.79 -0.72 S
Slide 10: Commission income on an improving trend
Page 10 Commission income on an improving trend Total fees and commission income up 6.5% qoq Fees from capital markets gained significantly 43% qoq Lending activities show positive trends 176 168 155 119 120 113 Lending Activities 60 81 64 42 44 Network & Other Activities 27 42 28 29 Capital M
Slide 11: Costs reduction exceeds target of -5%
Page 11 Costs reduction exceeds target of -5% Cost evolution Sharp cost deceleration (yoy%) -9.7% 0.0% 27.5 24.4 22.4 20.7 15.7 11.3 401 401 8.6 7.9 389 4.8 3.1 375 Group 27 362 363 29 45 -3.4 Greece Depr. 33 -5.8 33 36 -6.1 -6.7 159 144 FY 07 1Q 08 1H 08 9M 08 FY 08 1Q09 1H 09 Admin. 140 161 133 13
Slide 12: Greek costs in retreat for fourth consecutive quarter
Greek costs in retreat for fourth Page 12 consecutive quarter Greece OpEx evolution Greek C/I on an improving trend 4Q 07 235 43.3% 43.1% 2Q 08 42.1% 4 1Q 08 224 230 3Q 07 215 15 13 3 4Q 08 231 3Q 08 212 1Q 09 211 2Q 09 215 3Q 4Q 1Q 2Q FY 08 1Q 09 2Q 09 Figures in € m. 12
Slide 13: New Europe costs growth turns negative
Page 13 New Europe costs growth turns negative NE OpEx evolution New Europe C/I ratio at historic lows -14% Employees – period end 172 12 9 150 21 147 14,500 14,400 Depr. 14 16 14,200 19 82.4 13,900 80 13,500 84 77.4 Admin. 81 13,100 70 71 -21% 75.8 66 11,800 Cost / Income (%) 11,600 66.2 65.0 Staff
Slide 14: Pre-provision profit and bottom line improve
Pre-provision profit and bottom line Page 14 improve Greece: Net profit q-o-q Greece: Pre-provision profit grows* +28% 103 +6% 92 296 279 67 232 4Q 08 1Q 09 2Q 09 4Q 08 1Q 09 2Q 09 Figures in € m. Figures in € m. * excl. € 160m own debt revaluation gain in 4Q 08 New Europe’s pre-provision profit res
Slide 15: Management priorities
Page 15 Management priorities Group pre-provision profit steadily on the rise To sustain and improve pre- provision earnings capacity 1,551 Accelerating selectively business development Cost containment – OpEx aimed to exceed 5% reduction Proper pricing of risks and liquidity FY 08 Δ NII Δ F
Slide 16: Segmental Performance
Page 16 Segmental Performance 16
Slide 17: PBT after minorities gains 6% qoq as environment improves
Page 17 1Q 09 PBT after minorities gains 6%qoq as environment improves PBT* per Segment Group PBT* Share of profits 10.9% 81.3% 2.8% 23.7% -35.0% 6.3% 161 102 96 1H 09 47 22 5 -69 Retail Corporate Wealth Global & Capital New Europe 1Q 09 2Q 09 Management Markets Figures in € m. * after minority inte
Slide 18: Retail Segment
Page 18 Retail Segment Quarterly PBT evolution (€ m) 104 90 84 2Q 09/1Q 09 growth 2% 2% 0% 30% 28 9 12 301 307 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09 FY 08 1H 09 140 143 152 153 – Cost to Income 46.2% 46.5% – Return on Equity 29.7% 4.6% – Return on RwA 2.74% 0.42% 9 12 – Share of profits 57.2% 10.9% Re
Slide 19: Corporate Segment
Page 19 Corporate Segment Quarterly PBT evolution (€ m) 83 78 63 64 65 66 2Q 09/1Q 09 13% 4% 129% 6% growth 126 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09 111 83 78 FY 08 1H 09 – Cost to Income 28.8% 23.1% – Return on Equity 23.4% 27.1% 27 28 – Return on RwA 1.66% 2.04% 15 – Share of profits 48.3% 81.3% 7
Slide 20: Wealth Management Segment
Page 20 Wealth Management Segment Quarterly PBT evolution (€ m) 25 14 2Q 09/1Q 09 9 growth 2% 2% 13% 3 3 0 18 18 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09 15 15 FY 08 1H 09 – Cost to Income 56.4% 84.1% – Return on Equity 35.9% 8.0% – Share of profits 9.0% 2.8% 3 3 Revenues Expenses Profits 1Q 09 Wealth Ma
Slide 21: Global & Capital Markets Segment
Page 21 Global & Capital Markets Segment Quarterly PBT evolution (€ m) 53 56 45 2Q 09/1Q 09 26 25 growth 13% 6% 17% 22 44 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09 39 FY 08 1H 09 25 22 – Cost to Income 29.8% 40.6% 16 17 – Return on Equity 42.3% 22.0% – Share of profits 33.6% 23.7% Revenues Expenses Profit
Slide 22: New Europe Segment
Page 22 New Europe Segment Quarterly PBT evolution (€ m) 45 37 23 2Q 09/1Q 09 3% -2% 15% N/A growth -18 -32 228 235 -37 1Q 08 2Q 08 3Q 08 4Q 08 1Q 09 2Q 09 160 157 119 FY 08 1H 09 103 – Cost to Income 68.4% 68.3% – Return on RwA 0.75% -1.01% – Share of profits 16.3% -35.0% -32 -37 Revenues (5) Expen
Slide 23: Appendices
Page 23 Appendices 23
Slide 24: Financial Ratios
Page 24 Financial Ratios Financial Ratios 1H 09 1H 08 Net Interest Margin 2.72% 3.17% Cost-Income 49.09% 48.63% NPLs (% of loans) 4.08% 2.54% NPLs coverage 65.8% 83.8% Provision Charge (% of net loans) 1.98% 1.07% Tier Ι Ratio* 10.9% 8.8% Total Capital Adequacy* 12.1% 11.4% ROA after tax 0.42% 1.23%
Slide 25: Summary Figures
Page 25 Summary Figures Summary Figures (€ m) 1H 09 1H 08 Δ% New Europe Net Interest Income 1,133.9 1,155.9 -1.9% 383.4 Net fees & Commissions 196.6 309.2 -36.4% 73.4 Insurance and Non banking fees 36.9 35.0 5.4% 2.7 Total Operating Income 1,475.8 1,596.2 -7.5% 474.8 Operating Expenses 724.5 776.2 -
Slide 26: Key figures of New Europe operations
Page 26 Key figures of New Europe operations Romania Bulgaria Serbia Cyprus Poland Turkey Ukraine NE Δ% Total Assets 6,167 4,042 1,631 1,665 4,775 2,076 791 21,163 13% Balance Sheet Total Loans 3,679 3,158 1,067 512 4,050 1,035 695 14,195 7.7% Total Deposits 2,324 1,828 714 1,436 2,346 755 227 9,625
Slide 27: Key regional macroeconomic data
Page 27 Key regional macroeconomic data GDP growth (%) CPI (%) Public Debt / GDP Current Account / Unemployment (%) (%) GDP (%) 2009e 2010f 2009e 2010f 2009e 2010f 2009e 2010f 2009e 2010f EU (4.0) (0.1) 0.9 1.3 72.6 79.4 (1.6) (1.7) 9.4 10.9 Greece (0.9) 0.1 1.8 2.3 103.4 108.0 (11.5) (11.9) 9.1 9.7
Slide 28: 1H 2009 – Summary per Segment
Page 28 1H 2009 – Summary per Segment Segmental Results 1H 09 Wealth Global & Capital Capital & Elimination Total (€ m) Retail Corporate Management Markets Other Center New Europe Interest income 543.4 197.2 -2.1 25.4 -2.6 0.0 372.6 1,133.9 Net fee & commission income 23.5 23.1 21.5 55.9 -0.76 0.0 7
Slide 29: 1H 2008 – Summary per Segment
Page 29 1H 2008 – Summary per Segment Segmental Results 1H 08 Wealth Global & Capital Capital & Elimination Total (€ m) Retail Corporate Management Markets Other Center New Europe Interest income 602 150 16 54 18 0 317 1,156 Net fee & commission income 28 22 39 83 0 0 138 309 Net Insurance income 0
Slide 30: Contacts
Page 30 Contacts EFG Eurobank Ergasias, 20 Amalias Avenue, 105 57 Athens, Greece Fax: +30 210 3337 160 E-mail: investor_relations@eurobank.gr Internet: www.eurobank.gr Reuters: EFGr.AT Bloomberg: EUROB GA Investor Relations Dimitris Nikolos Tel: +30 210 3337688 E-mail: dnikolos@eurobank.gr Yanni