Procredit Holding Ag · XETR:PCZ
Procredit — ProCredit Holding AG & Co. KGaA — Q1 2023 Earnings Presentation
48 slides from Procredit's earnings presentation, May 15, 2023
Slide 1: Q1 2023 results
Hubert Spechtenhauser, Chairman of the Management Board Christian Dagrosa, CFO and member of the Management Board Q1 2023 results Frankfurt am Main, May 2023 (updated as of 14 th February 2024)
Slide 2: A. Highlights and business update
A. Highlights and business update B. Group results C. Regional performance D. Outlook ProCredit Group | Q1 2023 results | Frankfurt am Main, 15 May 2023 1
Slide 3: Highlights Q1 2023
Highlights Q1 2023 Strong first quarter result underlines group’s medium-term ambitions 13.3% ► RoE of 13.3% well within range of medium-term target due to positive margin development and strong credit risk performance RoE, 11.6% excl. UKR (+1.5pp vs. Q1-22) ► Operating income increases by 21%, as n
Slide 4: Q1 2023 results versus guidance
Q1 2023 results versus guidance Guidance Actual FY 2023 Q1 2023 ► Growth of the loan portfolio Medium single digit percentage growth1 -0.5%1 6.0 – 8.0% 13.3% ► Return on equity (RoE) (based on up to 70bps cost of risk) (12bps cost of risk) On FY 2022 level2 59.7% ► Cost-income ratio (CIR) (2022: 64.
Slide 5: Customer loan portfolio on stable level
Customer loan portfolio on stable level Loan portfolio growth ► Customer loans slightly reduced by EUR 47m or 0.8% since +0.5% YoY (1.5% FX-adj) beginning of the year -0.8% YTD (-0.5% FX-adj) ▪ Targeted reduction of loan portfolio in Ukraine of EUR 29m 5,924 6,029 6,108 6,061 (EUR 22m on FX adjusted
Slide 6: Good deposit development through digital banking channels
Good deposit development through digital banking channels Deposit growth ► YoY increase of EUR 807m or 14.6% +14.6% YoY (15.2% FX-adj) +0.6% YTD (+0.8% FX-adj) ▪ Strong growth across all products 6,290 6,324 5,542 5,517 ▪ Particularly good contribution from private individual client 1,872 2,052 depo
Slide 7: Strategic group positioning on SEE/EE, with positive expected GDP development
Strategic group positioning on SEE/EE, with positive expected GDP development and increased international focus on the region GDP outlook for SEE/EE remains intact, Euro area lower Macroeconomic environment / key current themes SEE/EE, excl. Ukraine(1) Euro area • 2023 median GDP growth in SEE/EE es
Slide 8: B. Group results
A. Highlights and business update B. Group results C. Regional performance D. Outlook ProCredit Group | Q1 2023 results | Frankfurt am Main, 15 May 2023 7
Slide 9: Operating income and expense overview
Operating income and expense overview 14.5 13.7Operating income 14.0 14.0 12.6 1.3 ► Strong increase in operating income yoy by approx. 21%, to 1.2 1.2 1.1 1.3 EUR 93.7m in Q1-23 339.8 281.9 93.7 ▪ Continued positive dynamics in net interest (up 25% yoy) 77.7 and net fee income (up 11% yoy) 12.5 12.
Slide 10: Net interest income
Net interest income 3.3% 3.4% 3.1% 3.2% Quarterly development 2.9% ► Q1-23 NII increased by EUR 2.8m or 3.9% vs. Q4-22 to EUR 3.3% 3.4% 75.4m, with NIM of 3.4% 3.1% 3.2% 72.6 75.4 2.9% 64.7 67.2 14.5 13.7 14.0 14.0 60.2 12.6 12.6 72.6 75.4 11.9 ▪ Continued positive re-pricing effects of portfolio of
Slide 11: Net fee and commission income
70.0 60.0 50.0 Net fee and commission income 40.0 Quarterly development 14.5 ► Net fee and commission income increased by 11% yoy, 13.7 14.0 14.0 30.0 12.6 14.0 14.5 1.3 14.0 reaching good level of EUR 14m in Q1-23 13.7 1.2 1.2 1.1 12.6 1.3 1.3 1.2 1.2 1.1 (in EUR m) 20.0 1.3 ▪ Positive development
Slide 12: Personnel and administrative expenses
Personnel and administrative expenses Quarterly development 72.6% 72.6% ► Q1-23 cost-income ratio on good level of below 60% 61.0% 61.0% 61.9% 61.9% 59.7% 59.7% 59.1% 59.1% 14.0 72.6% 14.5 14.0 13.7 12.6 61.9% 1.3 59.7% 59.1% 61.0% 1.2 1.2 1.1 ▪ EUR 57.0% 1.1m negative 57.0% extraordinary effect on
Slide 13: Loss allowance
.0 70 .0 60 .0 50 Loss allowance .0 35.6 40 35.6 Quarterly development 14.0 14.5 14.0 ► Q1-23 loss allowance on low level of EUR 1.9m, with cost of .0 238 bps 12.6 141 bps13.7 139 bps 30 25.4 164 bps 12 bps risk of 12 basis 25.4 points well below the previous-year quarters 1.2 1.3 1.121.8 21.7 1.2 2
Slide 14: Loan portfolio quality
Loan portfolio quality Loan portfolio by geography Net-write offs (annualised) Ecuador Germany 0.1% 0.1% 0.1% 0.2% 0.2% 1% Moldova 8% Bulgaria 3% 24% Georgia 6% Ukraine Stage 2 9% 7.8% 7.3% 7.5% 7.3% 7.0% Albania 4% Serbia 4.6% 4.5% 3.2% 3.3% 3.7% Bosnia & 15% Herzegovina 5% Romania 6% North Kosovo
Slide 15: Regulatory capital, risk-weighted assets, capital ratios
Regulatory capital, risk-weighted assets, capital ratios Capitalisation overview ► CET1 ratio increased to 14.1% mainly due to further increase in in EUR m Dec-22 Mar-23 RWA efficiency CET1 capital 820 837 Additional Tier 1 capital 0 0 ▪ CET1 capital includes 2/3 of profits of FY 2022; 0.1ppt pro- T
Slide 16: C. Regional performance
A. Highlights and business update B. Group results C. Regional performance D. Outlook ProCredit Group | Q1 2023 results | Frankfurt am Main, 15 May 2023 15
Slide 17: Contribution of regional segments to group net income
Contribution of regional segments to group net income Group functions, e.g. risk management, reporting, capital management, IT, liquidity management, training and development Includes ProCredit Holding, Quipu, ProCredit Academy Fürth, PCB Germany (EUR 51m loan portfolio; EUR 257m deposits) (Q1-23, i
Slide 18: Segment South Eastern Europe
Segment South Eastern Europe Segment key financials SEE Individual bank development (Q1-23) Operating income (€m) Cost-income ratio Country Profit after tax (€m) Cost-income Return on ratio equity +26% -1.1pp 56.1% Bulgaria 6.3 52% 12% 58.3 55.0% 46.2 Kosovo 5.8 49% 24% Q1-22 Q1-23 Q1-22 Q1-23 Serbi
Slide 19: Segment Eastern Europe
Segment Eastern Europe Segment key financials EE Individual bank development (Q1-23) Operating income (€m) Cost-income ratio Country Profit after tax (€m) Cost-income Return on +21% ratio equity -3.3pp +32% 145.6 Georgia 5.1 45% 19% 120.3 50.7% 48.0% 47.4% 26.4 50.0 22.9 20.0 42.6% 13.4 Ukraine 3.1
Slide 20: Update on ProCredit Bank Ukraine
Update on ProCredit Bank Ukraine Current status of operations Regional risk classification ► Safety of staff: Out of 308 staff (329 at the start of the year), 11 are mobilized ► Banking operations basically uninterrupted since beginning of the war: Bank’s operationality secured through uninterrupted
Slide 21: D. Outlook
A. Highlights and business update B. Group results C. Regional performance D. Outlook ProCredit Group | Q1 2023 results | Frankfurt am Main, 15 May 2023 20
Slide 22: Outlook FY 2023
Outlook FY 2023 FY 2023 outlook for ProCredit group Medium single digit percentage growth ► Growth of the loan portfolio (FX adjusted) 6.0 – 8.0% ► Return on equity (RoE) (based on up to 70bps cost of risk) On FY 2022 level ► Cost-income ratio (CIR) (with margin of +/- 1 ppt) ► CET1 ratio and levera
Slide 23: Medium-term outlook
Medium-term outlook Medium-term outlook for ProCredit group ► Growth of the loan portfolio Medium to high single digit percentage growth p.a. ~12% ► Return on equity (RoE) (based on 25 – 30 bps risk cost over the cycle) ~57% ► Cost-income ratio (CIR) (without one-off effects) ► Green loan portfolio
Slide 24: Q&A
Q&A Photovoltaic project financed by ProCredit Bulgaria
Slide 25: Appendix
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | Q1 2023 results | Frankfurt am Main, 15 May 2023 24
Slide 26: 2022 sustainability highlights and developments
2022 sustainability highlights and developments Preferred partner for Enhanced trainings LATEST ACHIEVEMENTS thematic on E&S topics external events Developing Introduction of tools to facilitate Target achieved: Promoting and animal welfare Member of the NZBA ESG impacts and communicating E&S assess
Slide 27: Sustainability commitment firmly integrated in the business model
Sustainability commitment firmly integrated in the business model – Impact report 2022 published Impact through Environmental Comprehensive staff business responsibility development ► Supporting SMEs through the cycle ► Green loan portfolio > €1.2bn, avg. ► High diversity, gender parity growth 16% p
Slide 28: Appendix
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | Q1 2023 results | Frankfurt am Main, 15 May 2023 27
Slide 29: Q1 2023 results at a glance
Q1 2023 results at a glance In EUR m Q1-22 Q1-23 Y-o-Y Net interest income 60.2 75.4 15.3 Net fee and commission income 12.6 14.0 1.4 Other operating income (net) 4.9 4.3 -0.5 Operating income 77.7 93.7 16.1 Income Personnel expenses 23.3 27.6 4.3 statement Administrative expenses 22.6 28.3 5.7 Loss
Slide 30: Overview of quarterly financial development
Overview of quarterly financial development In EUR m Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 Net interest income 60.2 64.7 67.2 72.6 75.4 Net fee and commission income 12.6 13.7 14.0 14.5 14.0 Other operating income (net) 4.9 4.2 5.2 6.2 4.3 Operating income 77.7 82.5 86.4 93.2 93.7 Income Personnel expenses
Slide 31: Balance sheet
Balance sheet in EUR m Dec-22 Mar-23 Assets Cash and central bank balances 1,940 1,992 Loans and advances to banks 280 297 Investment securities 480 502 Loans and advances to customers 6,108 6,061 Loss allowance for loans to customers -215 -212 Derivative financial assets 13 12 Property, plant and e
Slide 32: Asset reconciliation
Asset reconciliation Other assets 12% Cash and cash equivalents 22% Net loans to 66% customers 14.0 14.5 14.0 13.7 12.6 1.3 1.2 1.2 1.1 1.3 12.5 12.8 13.2 12.8 11.4 (in EUR m) Q1-22 Q2-22 Q3-22 Q4-22 Q1-23 ProCredit Group | Q1 2023 results | Frankfurt am Main, 15 May 2023 31
Slide 33: Liabilities and equity reconciliation
Liabilities and equity reconciliation 14% Liabilities to banks 71% Liabilities to customers (in EUR m) 2% 1% Other liabilities 10% Equity ProCredit Group | Q1 2023 results | Frankfurt am Main, 15 May 2023 32
Slide 34: Appendix
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | Q1 2023 results | Frankfurt am Main, 15 May 2023 33
Slide 35: Structure of the loan portfolio by exposure and currency
Structure of the loan portfolio by exposure and currency Loan portfolio by exposure Loan portfolio by currency 7% 32% 35% 19% 53% 15% 12% 27% < 50k 50-250k 250-500k 500k-1.5m >1.5m EUR USD Other Currencies ProCredit Group | Q1 2023 results | Frankfurt am Main, 15 May 2023 34
Slide 36: Development of green loan portfolio
Development of green loan portfolio Green loan portfolio growth ► Green loan portfolio amounting to EUR 1.2bn, representing 20.2% of total loan portfolio 15.4% 16.6% 18.7% 19.0% 20.2% 20.2% ► Includes financing of investments in: 1,231 1,224 1,128 54 56 985 36 • Energy efficiency 795 21 678 17 • Ren
Slide 37: Structure of collateral
Structure of collateral Collateral by type (FY 2022) ► Majority of collateral consists of mortgages 2% ► Growing share of financial guarantees mainly as a result of 16% InnovFin and other guarantee programmes provided by the European Investment Fund ► Clear, strict requirements for types of acceptab
Slide 38: Appendix
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | Q1 2023 results | Frankfurt am Main, 15 May 2023 37
Slide 39: Income statement by segment
Income statement by segment South Eastern 01.01.- 31.03.2023 (in EUR m) Germany Eastern Europe South America Consolidation Group Europe Interest and similar income 10.7 40.8 62.5 12.0 -8.9 117.0 of which inter-segment 5.8 1.4 1.1 0.0 0.0 0.0 Interest and similar expenses 10.3 18.4 15.2 6.6 -8.9 41.6
Slide 40: Segment South Eastern Europe
Segment South Eastern Europe Regional loan portfolio breakdown Key financial data Bosnia & Albania Herzegovin 6% (in EUR m) Q1-22 Q1-23 a 6% Romania Bulgaria Net interest income 34.8 47.3 8% 33% Net fee and commission income 8.0 8.7 North Other operating income (net) 3.4 2.2 Macedonia 11% Operating
Slide 41: Segment Eastern Europe
Segment Eastern Europe Regional loan portfolio breakdown Key financial data Moldova 15% (in EUR m) Q1-22 Q1-23 Net interest income 19.2 22.3 Net fee and commission income 1.7 1.7 Ukraine Other operating income (net) 2.0 2.3 49% Operating income 22.9 26.4 Georgia Personnel expenses 4.5 4.4 36% Admini
Slide 42: Segment South America
Segment South America Regional loan portfolio breakdown Key financial data (in EUR m) Q1-22 Q1-23 Net interest income 6.0 5.4 Net fee and commission income -0.1 0.1 Other operating income (net) -0.3 0.0 Operating income 5.6 5.4 Personnel expenses 1.5 2.0 Admininistrative expenses 3.1 2.9 Ecuador 100
Slide 43: Key figures per ProCredit bank (as per Q1 2023)
Key figures per ProCredit bank (as per Q1 2023) North Bosnia & Country Bulgaria Serbia Kosovo Romania Macedonia Herzegovina Customer loan portfolio (EUR m) 1,437 899 686 477 355 289 Change in customer loan portfolio (%) 0.4% -3.2% 1.6% 0.6% 1.1% 1.4% Credit impaired loans (Stage 3) 0.9% 2.7% 1.8% 2.
Slide 44: Appendix
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | Q1 2023 results | Frankfurt am Main, 15 May 2023 43
Slide 45: Funding, rating and liquidity
Funding, rating and liquidity Funding sources Deposit-to-loan ratio development Rating 3%1% 1% 16% BBB (stable) Customer deposits 103% 104% ProCredit Holding rating Liabilities to banks by Fitch, last affirmed on Debt securities 23 March 2023 Subordinated debt Other liabilities 79% Dec-22 Mar-23 Tot
Slide 46: Explanatory note on performance indicators and ratios
Explanatory note on performance indicators and ratios The ProCredit group uses an integrated system of indicators to monitor ▪ The share of credit-impaired loans(7) is the most significant indicator to and manage the implementation and further development of the group’s assess portfolio quality busi
Slide 47: Contact Investor Relations
Contact Investor Relations Financial calendar (continuously updated on IR Website) Date Location Event information 16.05. - 17.05.2023 Frankfurt/ Main Equity Forum, Spring Conference 2023 05.06.2023 Frankfurt/ Main Annual General Meeting 14.08.2023 Interim Report as of 30 June 2023, 16:00 CEST Analy
Slide 48: Disclaimer
Disclaimer The material in this presentation and further supporting documents have been This presentation and further supporting documents may contain forward- prepared by ProCredit Holding AG & Co. KGaA, Frankfurt am Main, Federal looking statements including statements regarding our intent, belief
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