30 slides from Intercorp Financial Services's IPO roadshow presentation, June 2007
Slide 1: Management Presentation
Management Presentation June 2007
Slide 2: Disclaimer
Disclaimer The information contained herein is confidential information regarding Intergroup Financial Services Corporation (“Intergroup") and its subsidiaries. By accepting this information, the recipient agrees that it will, and it will cause its directors, partners, officers, employees and repres
Slide 3: Management Team
Management Team Team Blue Carlos Rodríguez-Pastor Chairman – Intergroup and Interbank Jose Antonio Rosas CFO – Intergroup Controller – Interbank Gonzalo Basadre Chief Investment Officer – Interseguro Team Green Jorge Flores CEO – Intergroup and Interbank Juan Carlos Vallejo Deputy CEO – Intergroup C
Slide 4: Offering Summary
Offering Summary Issuer: Intergroup Financial Services Corp. Common Stock on the Lima Stock Exchange Offering Structure: Internationally (under Rule 144A / Reg S) Ticker / Exchange: IFS / Lima Stock Exchange Number of Shares: 19,230,769 shares Offering Type: 7,692,308 primary shares (40%) / 11,538,4
Slide 5: Investment Highlights
Investment Highlights 1. Peru: Best performing economy in Latin America 2. Strong and growing financial system 3. Proven track record with focused strategy 4. Leading franchise in retail banking and annuities 5. Management team with deep domestic and international experience 4 Intergroup Management
Slide 6: Intergroup – A Leading Financial Services Company in Peru
Intergroup – A Leading Financial Services Company in Peru Overview of Intergroup Intergroup Financial Highlights (US$ million) 2004-1Q07 1Q07 CAGR # 2 provider of consumer loans Total Assets $2,975 16.7% # 2 provider of credit card financing among Total Loans (1) 1,341 16.0 banks (1) (2) Retail
Slide 7: Strategic Focus on Retail Banking and Annuities
Strategic Focus on Retail Banking and Annuities Others Float 1.9% 73.1% 1.0% 24.0% 96.8% 100.0% Asset Individual Retail / Commercial Capital Disability Retail Banking Management Annuities Life Mandatory Traffic Banking Markets Insurance and Other Insurance Insurance 53% of Loans(1) 47% of Loans(1) 6
Slide 8: 1. Peru: Best Performing Economy in Latin America
1. Peru: Best Performing Economy in Latin America 7
Slide 9: Sustained Economic Growth and Stability
Sustained Economic Growth and Stability Fastest Growing Economy Among Peers (%) Lowest Inflation in the Region (%) Average GDP Growth (2002-2006) 2007E GDP Growth Average Inflation (2002-2006) 2007E Inflation 11.5% 6.8% 5.8% 5.4% 5.4% 5.4% 4.9% 4.7% 4.6% 4.5% 4.4% 3.5% 3.4% 3.3% 3.0% 2.8% 2.7% 2.4%
Slide 10: Improving Macroeconomic Conditions
Improving Macroeconomic Conditions Increasing Export Sector and Trade Balance Responsible Fiscal Policy Exports (US$ bn) Trade Balance / GDP (%) Fiscal Balance / GDP (%) 2.1% $25.6 $23.7 $17.3 0.3% 9.5% $12.8 8.0% $9.1 2001 2002 2003 2004 2005 2006 2007E $7.0 $7.7 6.6% (0.3%) 1.4% 4.3% 0.5% (1.0%) (
Slide 11: 2. Strong and Growing Financial System
2. Strong and Growing Financial System 10
Slide 12: Diversified and Growing Financial System
Diversified and Growing Financial System Financial System Breakdown by Assets (US$ billion) Top Players in Banking (Asset Market Share) 39.3% Banks Pension / Mutual Funds Other Lending Institutions Insurance 22.1% % $58.7 14.3 16.1% = GR $54.8 5.4% 7 CA 9.0% 10.1% Q0 5.6% –1 14.8% 01 3.4% 20 16.2% $
Slide 13: Strong Fundamentals Driving Profitable Growth in Banking
Strong Fundamentals Driving Profitable Growth in Banking Total Loans (US$ billion) ROAE (%) (2) 2001-1Q07 Retail Loans (1) Other Loans CAGR $16.5 8.7% $15.8 27.4% $12.7 22.7% 21.5% $10.6 $10.8 $11.0 $10.3 69.5% 69.0% 5.3% 70.8% 11.6% 72.4% 10.8% 81.7% 79.9% 75.5% 8.5% 4.4% 30.5% 31.0% 20.2% 27.6% 29
Slide 14: Growing and Profitable Insurance Sector
Growing and Profitable Insurance Sector Total Assets (US$ million) Total Premiums (US$ million) ROAE (%) (1) Annuities Other Life Insurance Non-Life Premiums $3,180 % $3,073 .6 2001-1Q07 19 % CAGR = 2.6 R 1 G = $1,109 34.2% CA $2,562 AGR $1,085 07 7 C Q0 1Q – 1 – 01 $919 $937 201 28.5% 01 $2,182 20
Slide 15: Underpenetrated Banking and Insurance Sectors
Underpenetrated Banking and Insurance Sectors Retail Loans Penetration (1) Credit Cards / Inhabitant Mortgage Loans / GDP (%) Consumer Loans / GDP (%) 52.9% 4.2 34.1% 18.9% 15.3% 13.4% 14.3% 1.1 1.0 0.9 9.0% 8.1% 0.5 4.2% 4.1% 0.3 2.0% 2.4% 1.6% 2.6% 2.3% 2.7% 0.2 0.1 Spain U.S. Brazil Chile Colombi
Slide 16: 3. Proven Track Record and Focused Strategy
3. Proven Track Record and Focused Strategy 15
Slide 17: Clear and Consistent Strategy
Clear and Consistent Strategy Elements of Our Strategy Key Objectives Expand distribution network: 70 new financial stores and 1,000 new ATMs by 2009 Convenience Continue developing electronic banking and alternative distribution channels Maintain leadership in annuities Customer Service
Slide 18: 4. Leading Franchise in Retail Banking
4. Leading Franchise in Retail Banking 18
Slide 19: Evolving Focus From Commercial to Retail
Evolving Focus From Commercial to Retail Loan Portfolio Mix Evolution Superior portfolio mix vs. industry Commercial Retail Retail lending contributed 74% of financial 25% income in 1Q07 (1) vs. 45% in 2001 47% 53% 75% 2001 1Q07 Increasing Funding from Deposits 1Q07 Deposit Breakdown Due to Bank
Slide 20: Leading Player in Retail Banking
Leading Player in Retail Banking Consumer Loans (US$ million) Retail Credit Cards (1) (US$ million) $534 $224 $227 $496 % % 6.6 7.5 2 3 m m ste ste y .S . Sy s v $373 vs $161 % % 3.8 .2 R 3 55 G R $310 G CA CA $126 $241 $94 $179 $62 $116 $23 2001 2002 2003 2004 2005 2006 1Q07 2001 2002 2003 2004 200
Slide 21: Demonstrated Ability to Deliver Results
Demonstrated Ability to Deliver Results Total Revenue (1) (US$ million) Profitability (2) Net Income (US$ million) ROAE (%) 29.3% $265.4 .3% 26.1% 12 $250.0 .5 % em 47 $54.0 yst m .S s te $50.3 vs Sy % . .3 vs 19 % 21.6% GR 1.2 $192.4 7 CA GR C A $169.6 $33.0 14.5% $141.8 12.9% $136.0 $20.1 9.6% $10
Slide 22: Strong Asset Quality, Improving Efficiency and Solid Capital Base
Strong Asset Quality, Improving Efficiency and Solid Capital Base PDLs / Total Loans (%) Reserves / PDLs (%) 11.2% 235.4% 241.5% System 246.5% 7.9% 184.3% 175.8% 6.5% 4.9% 151.9% 151.7% 120.1% 2.9% 1.9% 1.9% System 1.6% 2001 2002 2003 2004 2005 2006 1Q07 2001 2002 2003 2004 2005 2006 1Q07 Cost / Inc
Slide 23: 4. Leading Franchise in Annuities
4. Leading Franchise in Annuities 23
Slide 24: Leading Franchise in Annuities and Life Insurance
Leading Franchise in Annuities and Life Insurance Annuities (US$ million) Life Premiums (US$ million) CAGR 27.2% vs. System 28.5% CAGR 31.3% vs. System 16.6% $72.5 $89.3 $64.3 $78.7 $78.4 $77.1 $57.1 $71.5 $51.3 $52.6 $14.8 $15.3 $18.8 $18.1 2001 2002 2003 2004 2005 2006 LTM 2001 2002 2003 2004 2005
Slide 25: Most Profitable Among Largest Peruvian Insurance Companies
Most Profitable Among Largest Peruvian Insurance Companies Total Assets (US$ million) Profitability (1) 9.6% Net Income (US$ million) ROAE (%) m1 te s . Sys $479.5 v $458.3 % 47.8% 46.4 R em 46.5% 07 CAG $374.3 Syst -1Q vs. 1 200 $289.1 5% 115. $20.5 $209.5 G R CA 34.1% 07 2-1Q $94.1 $61.7 200 32.1%
Slide 26: 5. Management Team With Deep Domestic and International Experience
5. Management Team With Deep Domestic and International Experience 26
Slide 27: Experienced and Recognized Management Team
Experienced and Recognized Management Team Experience Name Position International Years in Sector Carlos Rodriguez-Pastor Chairman 25 Jorge Flores CEO Intergroup and Interbank 25 Juan Carlos Vallejo CEO Interseguro 19 José Antonio Rosas CFO Intergroup 2 Juan D’Auriol VP Credit Cards 10 And
Slide 28: Strong Corporate Governance
Strong Corporate Governance Intergroup: 5 members (2 independent) Board of Directors Interbank: 11 members (8 independent) Interseguro: 7 members (3 independent) Intergroup Audit Committee (3 board members) Interbank Executive Committee (4 board members and CEO of Interbank) Committees
Slide 29: Key Takeaways
Key Takeaways Peru: Best performing economy in Latin America Strong and growing financial system Proven track record and focused strategy Leading franchise in retail banking and annuities Management team with deep domestic and international experience 29 Intergroup Management Presentation
Slide 30: a Intergrou
a Intergrou financial service