Credito Emiliano S.p.a. · MIL:CE
Credito Emiliano — Q1 2019 Earnings Presentation
24 slides from Credito Emiliano's earnings presentation, 2019
Slide 1: Group Results 1Q19
GROUP RESULTS 1Q19
Slide 2: 1Q19 Highlights
1Q19 HIGHLIGHTS • Loans to Customers showed an excelent growth of +€1.1 billion YoY (+4.6% YoY compared to +0.8% GROWTH YoY of the Industry) • Wealth Management volumes were up +€1.4 billion in 1Q19 only (+4.4% vs FY18), also thanks to the market effect, with positive net inflows in february and mar
Slide 3: Income Statement
INCOME STATEMENT €, million 1Q18 4Q18 1Q19 Δvs 1Q18 Δvs 4Q18 • Compared to 1Q18, 1Q19 Operating Income was affected ù Operating Income 309.9 290.0 287.4 -7.3% -0.9% by a lower contribution from Core Operating Financial Activities, while Income (net of Fin. «core» Operating Income was 274.7 283.5 271
Slide 4: Income Statement: IFRS 16 Impact
INCOME STATEMENT: IFRS 16 IMPACT 1Q19 Δ 1Q19 Ifrs16 1Q19 €, million 1Q18 (pre-Ifrs 16) vs 1Q18 impact* (Ifrs 16) Net Interest Income 120.9 123.6 +2.2% -1.1 122.5 D&A -12.5 -13.3 +6.4% -5.8 -19.1 Admin. Expenses -58.5 -58.3 -0.3% +6.9 -51.4 Net Profit 44.9 44.9 Starting from January 1, 2019 the new I
Slide 5: Core Operating Income
CORE OPERATING INCOME CORE OPERATING INCOME (quarterly average) 275.3 271.7 280 268.3 +29% 270 257.0 260 248.8 247.7 250 234.0 240 230 224.4 220.7 224.4 220 209.9 210 200 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 1Q19 • Core* Operating Income (net of non-recurrent components: Income from Fin
Slide 6: Net Interest Income (1/3)
NET INTEREST INCOME (1/3) NET INTEREST INCOME: EVOLUTION +1.3% (+2.2% net Ifrs 16) Positive Net Interest Income performance, 126.4 +1.3% 1Q19 vs 1Q18 (+2.2% net of Ifrs 16 124.7 impact), thanks to the strong volumes 120.9 122.5 120.4 growth YoY Customers spread showed a growth of +4 bps vs 4Q18
Slide 7: Net Interest Income (2/3)
NET INTEREST INCOME (2/3) LOANS RATE DEPOSIT RATE Discontinuity in the time 2.68 2.63 2.59 2.58 series* 2.57 0.75 0.73 0.72 2.60 0.62 0.60 1.91 1.93 - 0.71 2.10 1.88 1.85 1.87 0.60 1.60 1.10 - 0.54 0.60 0.11 0.10 0.09 0.07 0.06 0.10 - 1Q18 2Q18 3Q18 4Q18 1Q19 1Q18 2Q18 3Q18 4Q18 1Q19 Credem: average
Slide 8: Net Interest Income (3/3)
NET INTEREST INCOME (3/3) SECURITIES’ PORTFOLIO BREAKDOWN Securities’ Portfolio stood at €7.4 billion, 2.7 bn 2.7 bn 2.7 bn 2.7 bn around -€390 million vs FY18 figure, 100% mainly due to the reduction of «core» Europe bonds 90% 28% 33% 36% 35% Italian govies exposure remained stable 80% 37% at €
Slide 9: Non Interest Margin
NON INTEREST MARGIN Total (€, million) 189.0 153.6 158.8 163.6 164.9 30.3 Performance Fees 7.7 6.5 14.5 5.9 Income from 43.2 45.3 45.5 Financial Activities 43.5 43.8 Banking Fees 15.5 13.9 16.2 14.4 17.1 Insurance Income 91.0 84.6 83.6 90.6 82.2 Asset Management and Brokerage Fees 1Q18 2Q18 3Q18 4Q1
Slide 10: Operating Costs
OPERATING COSTS OPERATING COSTS EMPLOYEES / NETWORKS -4.5% (-0.9% net Ifrs 16) Employees 6,195 6,249 6,068 6,140 192 184 176 188 183 5,899 5,763 5,544 5,519 5,604 5,609 180 59 59 51 61 56 2010 2011 2012 2013 2014 2015 2016 2017 2018 1Q19 130 Financial Advisors 133 129 132 885 80 123 120 855 827 820
Slide 11: Loans to Customers
LOANS TO CUSTOMERS LOANS TO CUSTOMERS: EVOLUTION 24,000 5,285 5,101 4,844 5,045 5,077 20,000 Other Loans 6,784 6,838 16,000 Residential 6,744 6,751 6,726 Mortgage 12,000 Leasing 2,538 2,546 2,392 2,435 2,476 Short-Term 8,000 Loans 9,925 10,017 9,813 10,890 10,509 4,000 0 1Q18 1H18 9M18 2018 1Q19 Tot
Slide 12: Loans: Comparison with the Industry
LOANS: COMPARISON WITH THE INDUSTRY LOANS TO CUSTOMERS GROWTH* MARKET SHARES** EVOLUTION 1.79% 1.77% +4.6% YoY 1.77% 140 Industry 1.66% 130 Credem 1.58% +37% 1.6% 1.48% 120 1.28% 110 1.3% 1.20% +0.8% YoY 1.16% MS on Performing Loans 100 1.07% 90 1.0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 1Q19
Slide 13: Group Customers Funding: Net Inflows Breakdown
GROUP CUSTOMERS FUNDING: NET INFLOWS BREAKDOWN 1,033 AUC 840 Direct Deposits AUM + Insurance 609 Total Net Inflows 511 259 245 285 193 70 130 41 -18 -103 -74 -389 -554 1Q16 1Q17 1Q18 1Q19 1Q16 1Q17 1Q18 1Q19 • 1Q19 total Net Inflows were positive and reached almost €200 million • AUM and Insurance s
Slide 14: Deposits, Bonds and AUM
DEPOSITS, BONDS AND AUM €, million 2017 2018 1Q19 • After the 2018 financial market negative evolution, AUM were back to growth, +€1.2 billion in 1Q19 only Sight / Saving Deposits 21,451 23,142 22,920 (+4.8% vs FY18) CD and Other Deposits 499 485 553 • Also Insurance Reserves showed a positive trend
Slide 15: Issued Bonds and Future Maturities
ISSUED BONDS AND FUTURE MATURITIES ISSUED BONDS BONDS MATURITIES Retail Bonds 000 Wholesale 365 Retail 500 1,407 1,473 000 127 1,500 23 500 938 2019 2020 2021 600 38 750 312 523 249 - 50 100 2010 2011 2012 2013 2014 2015 2016 2017 2018 1Q19 Wholesale Bonds 1,000 As of January 10, 2019, Credem issu
Slide 16: Credit Quality (1/2)
CREDIT QUALITY (1/2) GROSS NON PERFORMING LOANS 900 820 707 698 2017 600 2018 Bad Loans 465 413 411 Disposal 1Q19 300 41 34 34 0 Gross Bad Loans Gross UTP Loans Gross Past Due Loans % on Loans (Credem) 3.2 2.7 2.7 1.8 1.6 1.6 0.2 0.1 0.1 % on Loans (Industry)* 8.5 5.1 4.8 4.1 0.3 0.2 GROSS NPL RATIO
Slide 17: Credit Quality (2/2)
CREDIT QUALITY (2/2) NET QUARTERLY AVERAGE 2017-2019 GROSS NPL FLOWS NET QUARTERLY FOCUS 70 5 68 2017-19 Quarterly Average: - 14 €, million 0 42 46 48 -5 -1 -1 25 27 26 -7 28 22 -10 15 -11 -15 8 -20 -16 12 -6 -22 -11 -25 -22 -23 -26 32 -23 -30 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 1Q19 1
Slide 18: NPL Coverage
NPL COVERAGE NET NON PERFORMING LOANS €, million 2017 2018 1Q19 0 1Q19 Net Non Performing Loans furtherly reduced Net Bad Loans 319.3 232.6 227.7 to ~€550 million Total NPL accounting coverage kept growing and Net UTP Loans 374.9 300.2 296.6 reached 52% Net Past-Due Loans 33.7 26.6 26.8 Net Ba
Slide 19: NPL: Comprehensive Coverage
NPL: COMPREHENSIVE COVERAGE Gross Net Shortfall* Coverage Comprehensive Coverage kept NPL Coverage (€, million) (€, million) (€, million) incl. Shortfall improving (above 83% for Bad Loans and 65% for total NPL), Bad Loans 698.2 227.7 67.4% 111.3 83.3% remaining among the highest in the Industry U
Slide 20: Cost of Risk
COST OF RISK 68 59 55 58 52 42 44 48 31 32 34 38 47 45 39 41 24 28 34 30 13 18 27 8 21 8 13 15 2010 2011 2012 2013 2014 2015 2016 2017 1Q18 2018 8 1Q19 Cost of risk Cost of Risk (net of non-recurrent events) COST OF RISK: HISTORY 80 70 70 62 59 60 Parmalat 55 52 1Q19 Cost of Risk was only €5 Default
Slide 21: Assets & Liabilities
ASSETS & LIABILITIES ASSETS Compared to FY18, Loans to 25,497 24,995 2018 Customers were affected 1Q19 12,000 from the 1Q usual seasonality (about -€500 million) and the 6,980 7,217 securities portfolio showed a 5,336 6,000 5,457 decrease of the HTC component (-€550 million) 2,276 1,762 1,726 Bo
Slide 22: Liquidity Ratios
LIQUIDITY RATIOS NSFR LCR 220% 123% 124% 210% 121% 180% 166% 172% 100% 150% 120% 100% 90% 2017 2018 1Q19E 2017 2018 1Q19E 1.10 LOAN TO DEPOSIT RATIO* 1.05 Both NSFR and LCR stood well above minimum 0.98 regulatory requirements. NSFR at 124% allows the 1.00 0.97 0.96 Group for a greater flexibility
Slide 23: Consolidated Capital Ratios
CONSOLIDATED CAPITAL RATIOS CAPITAL AND CAPITAL CET1 RATIO FULLY PHASED RATIOS (fully phased) (CREDEMHOLDING)* Banking Group Credemholding 1,800 14.0% €,million 2018 1Q19 2017 FL 2018 1Q19 13.3% 13.2% 1,600 CET 1 1,920 1,963 1,799 1,782 1,832 13.0% 12.7% Total Capital 2,267 2,311 2,106 2,093 2,142 1
Slide 24: Disclaimer and Contacts
DISCLAIMER AND CONTACTS The manager responsible for preparing the company’s financial reports Mr. Paolo Tommasini of Credito Emiliano S.p.A., declares, pursuant to paragraph 2 of Article 154 bis of the Consolidated Law on Finance, that the accounting information contained in this presentation corres