Banca Monte Dei Paschi Di Siena S.p.a. · MIL:BMPS
Banca Monte Dei Paschi Di Siena — H1 2012 Earnings Presentation
44 slides from Banca Monte Dei Paschi Di Siena's earnings presentation, Aug 28, 2012
Slide 1: 1H2012 Results
1H2012 Results Siena, 28 August 2012
Slide 2: Contents
Contents 1H2012 Highlights Customer base Balance sheet Profit and Loss Business Plan progress update page 2
Slide 3: 1H2012 Highlights
1H2012 Highlights page 3
Slide 4: 1H12 Highlights (1/2)
1H12 Highlights* (1/2) Revenues substantially stable YoY, but down QoQ due to reduction of Operating Results interest rates and negative volume trends combined with ongoing correction of duration mismatch Cost of credit impacted by severe GDP downturn Funding erosion down in 2Q12, with lending
Slide 5: 1H12 Highlights (2/2)
1H12 Highlights (2/2) Leverage (TA/TE) Regulatory Capital Ratios (%) 27.9x 10.8 25.8x 10.3 8.9 19.2x 7.7 18.9x Dec-11 Jun-12 2011 Jun-12 Common Equity ratio* CT 1 TA/TE** TA/TE (net of AFS)*** Total Revenue* (YoY) Costs/Assets -1.1% 1.84% 2,806 2,837 1.61% 1.43% 1.46% 1.44% € mln Jun-11 Jun-12 2008
Slide 6: Focus on Capital
Focus on Capital Regulatory Capital Ratios (%) Main Trends CT1 as at June increased to 10.8% 10.3 10.8 (+50 bps vs. December 2011) 8.9 1H12 CT1 includes only part of the 7.7 Liability management actions that were completed in July (EUR 37 mln of total EUR 190 mln booked in 1H12) and Biver dispos
Slide 7: RWAs and Regulatory Capital Ratios
RWAs and Regulatory Capital Ratios RWA and Regulatory Capital Ratios Main Trends €/mln Dec-11 Mar-12 Jun-12 QoQ% RWA reduction is primarily RWA 105,189 102,594 96,157 -6.3% attributable to: Ratios (%) AIRB and AMA models roll-out to Core Tier 1 ratio * 10.3 10.5 10.8 0.30 subsidiaries Tier 1 rat
Slide 8: Issuance of government-sponsored capitalisation instruments
Issuance of government-sponsored capitalisation instruments Issuance of EUR 3.4 bn worth of new Government-sponsored capital securities for EBA purposes in 2012, of which EUR 1.9 bn for repayment of currently outstanding Bonds and EUR 1.5* bn to cover shortfall as at 30 June 2012, currently expect
Slide 9: Impairment test
Impairment test Total Goodwill write-downs of EUR 1,528 mln as at 30 June 2012 Goodwill write-down primarily due to the adverse macro-economic scenario which continues to be penalised by the sovereign debt crisis, tensions on the major financial markets and persisting uncertainties over global e
Slide 10: Customer base
Customer base page 10
Slide 11: Consolidating our customer base in a very challenging environment
Consolidating our customer base in a very challenging environment Net new customers (ex Biver) Number of claims -3.7% 46,000 5,263 49,000 5,070 50,000 2010 2011 Jun-12 Jun-11 Jun-12 Retention Rate* (ex Biver) Acquisition Rate* (ex Biver) 5.2% 5.4% 95.8% 95.8% Jun-11 Jun-12 Jun-11 Jun-12 * Annualised
Slide 12: Balance sheet
Balance sheet page 12
Slide 13: Assets & Liabilities
Assets & Liabilities Total Assets Main Trends €/mln Jun-11* Mar-12* Jun-12 QoQ% YoY% The Group’s Customer loans Customer loans 156,394 146,627 144,461 -1.5% -7.6% stood at EUR 144.5 bn, Loans to banks 10,793 14,877 17,130 15.1% 58.7% substantially in line with 1Q12, Financial assets 54,295 52,341
Slide 14: Direct funding
Direct funding Direct funding by Source Direct Funding by Source €/mn Jun-11* Mar-12* Jun-12 QoQ% YoY% Current Account & ex Biver ex Biver Time Repos 6.5% Current accounts & 66,037 61,677 60,672 -1.6% -8.1% Deposits (13.5% in Jun -11) Time deposits 45.8% Repos 22,006 6,828 8,604 26.0% -60.9% (40.5%
Slide 15: Focus on the network's placing power
Focus on the network’s placing power Funding breakdown Main Trends Extension of our funding maturities continued in 2Q12 33% 37% 38% For 2012, 73% of retail funding needs already met 67% 63% 62% Actively monitoring the market for potential windows of opportunities 2010 2011 Jun-12 on the insti
Slide 16: Institutional funding and Interbank Exposure
Institutional funding and Interbank Exposure Direct Funding* and Net Interbank Exposure** Main Trends 173 165 162 Institutional funding component increased (+ EUR 2 bn vs Mar 2012) 10.1 30.5 30.2 Unencumbered counterbalancing capacity** reduced (EUR 8.1 bn in June 2012, vs EUR 12.4 bn as at Marc
Slide 17: Indirect funding
Indirect funding Indirect funding Main Trends Indirect funding was down 6.4% on 1Q12, as a result of the slowdown in both AUM and AUC: €/mln Jun-11* Mar-12* Jun-12 QoQ% YoY% ex Biver ex Biver Assets under management down 3.1% on Assets under 1Q12 due to both net divestments in this 48,187 45,693
Slide 18: Lending
Lending Total Lending* Main Trends In 2Q12, Loans to customers were €/mn Jun-11 * Mar-12 * Jun-12 QoQ% YoY% ex Biver ex Biver substantially in line with 1Q2012 levels Current accounts 18,511 16,982 16,940 -0.2% -8.5% The aggregate was affected by both a decline Mortgages 87,759 85,822 85,179 -0.
Slide 19: Specialised lending product flows: deleveraging underway
Specialised lending product flows: deleveraging underway Reduction in flows and deleveraging consistent with Business Plan targets MPS Capital Services Leasing -12.3% -26.8% 355 311 283 207 € mln € mln Mar-12 Jun-12 Mar-12 Jun-12 Factoring Consumer Credit Flows -18.3% +0.5% 2,312 1,890 618 620 € m
Slide 20: Asset quality and Risk profile
Asset quality and Risk profile High-granularity loan book Low Risk top 10 customers account for 2.7% of total loans as at Concentration June 2012 vs. 3.6% in June 2011 strong geographical diversification High granularity Top 20 RE clients account for approx EUR 3 bn (13.8% of exposure to RE
Slide 21: Asset quality
Asset quality Mkt share (Delta %) of Performing and Non-Performing Loans Main Trends 2 Delta of Performing Loan Market Share Delta of NPL Market Share NPL market share up by 10 bps compared to June 2011 but down 0 by 575 bps from 2008 -2 As at the end of June 2012, the -4 Group's net exposure to
Slide 22: Asset quality: Coverage
Asset quality: Coverage Impaired Loans Coverage Main Trends As at June 2012, coverage of impaired -50bps loans stood at 39.2%, (-50 bps on March 40.6% 39.7% 39.2% 2012 due to a slight decrease in coverage of NPLs) The 50 bps decrease in NPLs coverage is driven by proportionally greater inflows o
Slide 23: Asset quality: NPL/Watchlist trend
Asset quality: NPL/Watchlist trend Gross NPL and Watchlist Inflows Main Trends NPL Watchlist NPL inflows up 12% QoQ in 2Q12 274 241 224 Conversely, watchlist loan inflows down 139 129 7.1% QoQ 237 225 224 198 212 Construction, agriculture and retail € mln contributed the highest flows of NPLs
Slide 24: Asset quality: Recovery flows
Asset quality: Recovery flows Monthly Recovery - Inflows Main Trends 90 Increase in recovery flows compared to 1Q12 60 In Residential and Commercial Real Estate (CRE) mortgages, BMPS’s Loan to Value 30 as at December 2011 (latest data available) was lower than that of main 0 € mln competitors du
Slide 25: PD and Provisioning
PD and Provisioning PD on performing loans (Δ bps Jun-12 vs Mar-12) Main Trends 0.44 Probability of default down on 2Q12 0.17 (2.14% vs. 2.16% of Mar-12) due to loan 0 book remix with a shift towards lower-risk counterparties and migration of risk -0.07 positions from performing to non- performing
Slide 26: Financial Assets
Financial Assets Securities and Derivatives Portfolio Main Trends Market Value Jun-12 QoQ% Financial Assets portfolio: EUR 36 bn (€ mln) down by 4.5% vs March 12 mainly due HFT 9,740 +7.7% to the reduction in the AFS component AFS 22,293 -8.1% L&R 04,299 -9.5% Total Portfolio 36,333 -4.5% Italian
Slide 27: Profit and Loss
Profit and Loss page 27
Slide 28: P&L: 1H2012
P&L: 1H2012* € mln Jun-11 Jun-12 Change MPS Group (*) Ins. % Net interest income 1,658.5 1653.7 -4.8 -0.3% Net commissions 912.1 836.9 -75.2 -8.2% Income from banking activities 2,570.6 2,490.6 -80.0 -3.1% Dividends, similar income and gains (losses) on equity investments 46.1 39.1 -7.0 -15.2% Net p
Slide 29: P&L: Quarterly trendline
P&L: Quarterly trendline* € mln 2011 2012 MPS Group 2nd quarter 3rd quarter 4th quarter 1st quarter 2nd quarter Net interest income 801.0 853.5 910.4 874.1 779.6 Net commissions 448.8 450.0 400.3 424.3 412.6 Income from banking activities 1,249.8 1,303.5 1,310.8 1,298.4 1,192.2 Dividends, similar in
Slide 30: Focus on Net Interest Income
Focus on Net Interest Income Net Interest Income* (YoY) Net Interest Income* (QoQ) -2.6% -0.3% -10.8% 910 1,659 854 874 1,654 801 780 € mln € mln Jun-11 Jun-12 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 2Q12 NII Analysis Main Trends NII totals approx. EUR 1,654 mln, substantially in line with previous yea
Slide 31: Commercial Mark up and Mark down
Commercial Mark up and Mark down Short Term Mark up* Short Term Mark down* -116bps +148bps MPS MPS Short Term Spread Main Trends Euribor reduction (from average 0.64% in 1Q12 to 0.39% in 2Q) put pressure on mark down +32bps Short-term spread up 32 bps on Jun- 11, but down by 3 bps vs Mar-12 MPS
Slide 32: Fee and Commission Income
Fee and Commission Income Fees* YoY Fees* QoQ -8.1% -8.2% -2.8% 912 449 837 450 424 413 400 € mln € mln Jun-11 Jun-12 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Fees breakdown Main Trends €/mn Jun-11 Mar-12 Jun-12 QoQ% YoY% ex Biver ex Biver Net fees and commissions, totalling AuM dees, o/w 118 130 124 -4
Slide 33: Dividends and trading
Dividends and trading Other Revenues Main Trends Dividends and gains on €/mn 2Q11 1Q12 2Q12 QoQ% YoY% ex Biver ex Biver investments: EUR 28.5 mln in 2Q12 Dividends, similar income and gains Bancassurance contribution: EUR 35 19 11 29 n.m 52.0% (losses) on equity investments mln in 1H12 Net tradi
Slide 34: Operating Costs
Operating Costs Total Costs (YoY % growth) Main Trends +0.7% Operating costs up by 0.7% in 1H12 despite unfavourable regulatory framework -0.8% -0.8% Cost/income ratio down to 59.5%, a significant improvement on -5.2% December 2011 -8.0% Overall Cost/Assets trend continues 2008 2009* 2010 2011
Slide 35: Personnel Expenses
Personnel Expenses Personnel expenses* YoY Personnel expenses* QoQ +6.7% +2.1% +4.1% 1,038 1,060 597 541 507 514 519 € mln € mln Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Jun-11 Jun-12 Headcount trend vs. Business Plan Main Trends 31,424 30,422 Cost management actions will start to generate gains as of 2
Slide 36: Administrative Expenses and Net Adjustments
Administrative Expenses and Net Adjustments Administrative expenses* YoY Administrative expenses: breakdown Communi- cation Real -4.2% 5.2% Estate Others 542 19.6% 34.5% 519 Taxes 2.1% Consulting Logistic 1.0% 20.2% TLC € mln ICT 1.2% Jun-11 Jun-12 16.3% Net adjustments* to fixed assets Main Trends
Slide 37: Other P&L components
Other P&L components Net provisions Net provisions for risks and charges and other operating expenses (income), totaling approx. -EUR 128 mln, comprise: approx. EUR 61 mln of provisions for risks and charges, of which roughly EUR 43 mln in 2Q2012 primarily arising from legal disputes/claw-back a
Slide 38: Business Plan progress update
Business Plan progress update page 38
Slide 39: 2012-2015 Business Plan Progress Update (1/2)
2012-2015 Business Plan Progress Update (1/2) Business Plan progress is being monitored to ensure full «execution» of both short-term commercial objectives in the «100-day Plan» and longer-term Projects underlying the 2012-2015 Business Plan 2012 2013 2014 2015 21 Projects to fully Executive Plan
Slide 40: Business Plan execution: 100 days Plan track record (2/2)
Business Plan execution: 100 days Plan track record (2/2) Direct Funding flows Lending flows € mln € mln 1Q12 2Q12 July August 1Q12 2Q12 July August Bancassurance flows (Monthly average ) NPL flows (Monthly average ) € mln € mln 1Q12 2Q12 July August 1Q12 2Q12 July August page 40
Slide 41: Thank you for your attention - Q&A
Thank you for your attention Q&A page 41
Slide 42: 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
Slide 43: 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 strategies and financials. The information contained herein has not been independently verified. No representation or warranty, express or implie
Slide 44: fe DEI PASCHI
fe DEI PASCHI I SIENA ==” BANCA DAL 1472 www.mps.it
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