Permanent TSB Group Holdings PLC · EURONEXT:PTSB
Permanent TSB — FY2013 Earnings Presentation
30 slides from Permanent TSB's earnings presentation, Aug 24, 2014
Slide 1: permanent tsb
permanent tsb
Slide 2: Forward Looking Statements
Forward Looking Statements 1 A number of statements we make in our presentation, and in the accompanying slides, will not be based on historical fact but will be “forward‐ looking” statements within the meaning of the US Private Securities Litigation Reform Act of 1995. Actual results may differ mat
Slide 3: Road to Recovery
Road to Recovery Year Key Milestones Stage 2 2012 • Overhauled the Group Architecture • New Senior Management Team • Restructuring Plan Submission • Building Capabilities Including Establishing the AMU Laying the 2013 • Completion of Internal Reorganisation Foundations • Return to Lending and Buildi
Slide 4: Agenda
Agenda 3 1 • Summary and Progress To Date 2 • Financial Performance 3 • Arrears Management 3 4 • Recap & Priorities 5 •Q & A 3
Slide 5: Summary and Progress To Date
4 1 • Summary and Progress To Date 4 Jeremy Masding 4
Slide 6: Turning the Corner
Turning the Corner 5 Successful re‐entry into the market; force for competition Permanent tsb SBU profitable in 2014 System Funding reduced by 35%; returned to wholesale market Arrears have peaked and are now in decline Engaged with over 80% of customers in financial difficulties 5 CBI B
Slide 7: Summary Financial Performance (1)
Summary Financial Performance (1) 6 Loss after tax of €261m including two significant one‐off accounting adjustments for pension schemes and deferred tax assets Loss pre‐exceptional items flat versus 2012 at €977m; operating loss pre‐ impairment charge reduced by 44% Total operating income inc
Slide 8: Summary Financial Performance (2)
Summary Financial Performance (2) 7 Funding and Liquidity positions improved o €2.6bn Senior Debt repaid + System funding down by 35% o Market access signified by €500m of RMBS issuance in 2013 o Customer deposits increased by €2.9bn to 56% of total funding requirement 7 Core Tier 1 ratio of 13.
Slide 9: Core Bank
Core Bank 8 permanent tsb Group permanent tsb bank Asset Management Unit Non Core (UK) Non Core (ROI) 8 An end‐to‐end Irish Retail Bank; serving customers and an asset for the State permanent tsb – providing competition in the Irish Market Place AMU – Best‐in‐class collections unit 8
Slide 10: Core Bank – permanent tsb
Core Bank – permanent tsb 9 permanent tsb bank has returned successfully to the market, with major gains in Current Accounts and Lending. Deposits Current Accounts Lending Retail Deposits up by €0.5bn Over 40,000 new Current Close to €300m new Mortgages Accounts opened approved; over €200m paid out
Slide 11: Core Bank – permanent tsb
Core Bank – permanent tsb 10 Success has been driven by a range of simple, innovative, customer‐friendly products, supported by new technology. New Initiatives • New Products: Early 2014 signs Fee‐free Switch Current Account encouraging… €100m home improvement fund Market Leading Car Finance O
Slide 12: Core Bank – AMU
Core Bank – AMU 11 • Collections through to Recoveries is an integral part of an end to end banking platform • Invested heavily to build and develop this capability and skillset in the AMU The AMU has 3 Key Objectives: 1. Deliver a better 2. Support ptsb front- 3. Meet all Central Bank bottom line e
Slide 13: Non‐Core
Non‐Core 12 permanent tsb Group permanent tsb bank Asset Management Unit Non Core (UK) Non Core (ROI) • Capital Home Loans • CRE • Isle of Man • Springboard 12 Non‐Core being managed in line with expectations; Outsourced management of CRE book to enhance value Increasing buyer appetite for Iri
Slide 14: Financial Performance
13 2 • Financial Performance Glen Lucken 13 13
Slide 15: Group Income Statement
Group Income Statement €m 2013 2012 Change Total Operating Income 14 Net Interest Income 309 300 3.0% Increased by 28% largely due to reduction in ELG NIM (excluding ELG) has increased to 0.82%, Other Income (net) 48 62 ‐22.6% primarily due to reduction in cost of funding and ELG Fees (105) (165
Slide 16: Segmental Performance
Segmental Performance 15 2013 2012 ptsb AMU Non‐Core Group Group Underlying Loss Before (€153m) (€561m) (€283m) (€977m) (€977m) Exceptional Items NIM 1.03% 0.11% 0.21% 0.82% 0.72% Loans to Customers €14.2bn €6.4bn €8.7bn €29.3bn €31.8bn Total Assets €21.9bn €6.4bn €9.3bn €37.6bn €40.9bn 15 ptsb re
Slide 17: Operating Expenses
Operating Expenses 16 Staff Costs €300m €283m Staff costs reduced by €23m or 15% due to changes on pension €127m entitlements, other staff benefits and €150m savings achieved from VSS Average staff numbers increased mainly due to significant staffing up in 16 the AMU (c.300), offset by staff €17
Slide 18: Impairment Charges
Impairment Charges 17 €m Impairment Charges PCR 2013 2012 Change 2013 2012 ROI Mortgages ‐ HLs 439 292 50% 37% 34% ‐ BTLs 290 224 30% 58% 50% UK Mortgages 21 25 ‐16% 31% 28% CRE 160 320 ‐50% 63% 66% Consumer 19 3017 ‐37% 97% 101% Total Group 929 891 4% 47% 45% Impairments on ROI HLs increased by €
Slide 19: Funding
Funding Balance Sheet Metrics 2013 2012 Balance Sheet Metrics 2013 182012 €bn Wholesale Funding: Funding Mix: Monetary Authorities 6.9 10.7 Deposits 56% 45% Market 7.9 9.6 Long‐Term Debt 28% 33% Short‐Term Debt 16% 22% Deposits: 100% 100% Retail 14.0 13.5 ECB Funding 20% 29% Corporate 5.5 3.1 LDR 15
Slide 20: Capital
Capital 19 Capital Ratios at 31 December 2013 These ratios reflect outcomes from the Balance Sheet Assessment including: 16.0% Increase in RWAs (c.€3.3bn) 14.0% 13.1% 13.4% Increase in impairment provisions 12.0% 10.9% 10.5% (c.€0.3bn) 10.0% 8% 8% Core Tier 1 ratio at 31 December 2013 was 8.
Slide 21: Conclusion
Conclusion 20 NIM increased to 0.82% from a trough of 0.66% in H2 2012; 1.03% in ptsb SBU Rebuilding Staff costs down by 15%, other costs increased due to one‐ Profitability off provisions; further actions being taken to manage costs down Impairments remain elevated but outlook stabilising S
Slide 22: Arrears Management
21 3 • Arrears Management 21 Jeremy Masding 21
Slide 23: Arrears Management Headlines
Arrears Management Headlines Arrears have peaked and now in decline 22 PCR improved across all key portfolios ROI HLs 73% of ROI residential mortgages are HLs; of these 58% are ECB trackers Early Arrears continue to reduce and are ahead of industry; Late Arrears show signs of stabilisation a
Slide 24: Asset Quality: Total Portfolio Composition
Asset Quality: Total Portfolio Composition 23 Gross Loans NPLs 1% 3% 1% ROI HL ROI HL 20% 17% ROI BTL ROI BTL 6% CRE CRE 54% 53% CHL 26% CHL 19% Consumer Consumer 23 ROI HL ROI BTL CRE CHL Consumer Total Gross Loans €bn 17.6 6.4 2.1 6.8 0.4 33.3 Performing % 74% 65% 31% €17.7bn 96% €3.9bn72% 74% NPL
Slide 25: Arrears Levels – ROI HLs and ROI BTLs
Arrears Levels – ROI HLs and ROI BTLs ROI HL: €17.6bn 24 24€6.4bn ROI BTL: Source: CBI 24
Slide 26: Long Term Treatments – ROI HLs and ROI BTLs
Long Term Treatments – ROI HLs and ROI BTLs 25 For the 12 months to Offered Accepted 31 December 2013 (so far) Total Long Term Treatments ‐ HLs (# of Cases) 14,845 10,305 ‐ HLs (€m) €2,151 €1,445 ‐ BTLs (# of Cases) 3,221 2,035 ‐ BTLs (€m) €1,172 €751 25 AMU continues to make good progress in repl
Slide 27: Recap & Priorities
e Recap & Priorities permanent tsb 26
Slide 28: 2013 – Recap & Priorities
2013 – Recap & Priorities 27 Encouraging progress in 2013; years 1 and 2 of laying the foundation and building momentum complete Successful re‐entry into the market; force for competition Recap Arrears have peaked and now in decline Good traction on mortgage restructurings Improvements in
Slide 29: Debunking myths about permanent tsb
Debunking myths about permanent tsb 28 Tracker Mortgages Myths Restructuring Plan Stress Tests 28 Returning to Profitability Reality Growing Market Share and Competing Vigorously Here to Stay 28
Slide 30: permanent tsb
permanent tsb 72)
Permanent TSB Group Holdings — FY2013 Earnings Presentation on 6ix