Otp Bank Nyrt · BET:OTP
Otp Bank Nyrt — OTP Bank — FY2004 Earnings Presentation
36 slides from Otp Bank Nyrt's earnings presentation, March 2005
Slide 1: OTP Bank 2004 Preliminary Performance Based on HAR
OTP Bank 2004 Preliminary Performance Based on HAR Presented by: Dr. Zoltán Spéder CFO March 2005
Slide 2: Forward looking statements
Forward looking statements This presentation contains certain forward-looking statements with respect to the financial condition, results of operations, and businesses of OTP Bank. These statements and forecasts involve risk and uncertainty because they relate to events and depend upon circumstances
Slide 3: Macro environment
Macro environment
Slide 4: Interest rate environment from 2003
Interest rate environment from 2003 25-25 bp rate decrease 14% 23 March and 6 April 50 bp rate cut 4 May, 17 Aug, 200 bp rate increase 2004 19 Oct & 23 Nov, 21 Dec 2004 19 June 2003 13% 100-100 bp rate cut to 50 bp rate defend HUF 16&17 300 bp rate 12% decrease 25 January 2003 increase 28 Jan and 75
Slide 5: EUR/HUF environment 2003-2004
EUR/HUF environment 2003-2004 274 13.5% 269 12.5% 264 11.5% 259 10.5% 254 9.5% 249 8.5% Moving of center of 244 band (devaluation) 7.5% 239 6.5% 234.69 240.01 234 5.5% 2-Jan- 2-Mar- 2-May- 2-Jul-03 2-Se p- 2-Nov- 2-Jan- 2-Mar- 2-May- 2-Jul-04 2-Se p- 2-Nov- 2-Jan- 03 03 03 03 03 04 04 04 04 04 05 HU
Slide 6: Evolution of banking system
Evolution of banking system Intermediation started to grow due to mortgage lending and HUF bn wage increases 22,500 100% 20,000 90% 20,245 18,573 77.6% 17,500 80% 73.0% 15,000 16,740 70% 65.1% 65.3% 65.1% 64.7% 14,850 64.0% 12,500 64.1% 64.8% 60% 13,172 49.4% 10,000 11,394 50% 42.5% 10,087 8,540 7,5
Slide 7: Loan growth (Y-on-Y)
Loan growth* (Y-on-Y) Corporate Municipality shift from FX to HUF 70% 45% 42% shift from HUF 58% 40% 37% to FX 60% 35% 50% 35% 48% 50% 45% 46% 30%26% 42% 38% 24% 40% 35% 25% 20% 32% 34% 18% 17% 27% 28% 20% 17% 30% 36% 36% 34% 25% 14% 13% 15% 31% 20% 19% 29% 30% 31% 15% 20% 25% 26% 26% 25% 10% 7% 14%
Slide 8: Personal financial assets & liabilities
Personal financial assets & liabilities Retail Loans Outstanding (HUF bn.) Selected components of RFA vs. Real Wage Index 2,500 125 4,500 70% 31-Dec-97 30-Sep-04 CA GR (Rh-scale) Housing Loa ns 120 58.4% 4,000 60% Consum e r loa ns 2,000 115 Re a l wa ge s 3,500 50% 1990=100 110 3,000 40% 1,500 105
Slide 9: Macro assessment
Macro assessment 2003 2004F 2005F Real GDP growth 3.0% 3.9%** 3.5% Household consumption 6.5% 2.9% 2.0% Public consumption 5.4% -1.5% -2.0% Investment growth 3.0% 14.4% 7.2% Final consumption 7.3% 2.4% 1.6% Exports 7.6% 15.6% 11.5% Imports 10.4% 17.6% 10.0% Budged deficit (cash flow based) HUF -1,06
Slide 10: OTP Bank Consolidated HAR results and performance
OTP Bank Consolidated HAR results and performance
Slide 11: Market shares
Market shares* Market share – total assets Market share – total loans HUF bn HUF bn 2,500 25% O TP Bank Tot al loans 16,000 30% 2,000 20% Group t ot al 1,500 15% loans 14,000 28% 1,000 10% Market 12,000 26% share-t ot al 500 5% loans 10,000 24% 0 0% Group Market 31-Dec-30-Jun-31-Dec-30-Jun-31-Dec-30
Slide 12: Consolidated balance sheet, interest income
HAR Consolidated balance sheet, interest income Consolidated assets, liabilities Loans +19.5% +17.4% HUF bn HUF bn 3,000 CAGR: +9.3% 2,582.4 4,000 2,500 CAGR: 39.4% 2,078.8 3.7% 3,000 2,000 929 36.0% 2,000 1,328.0 791 1,500 2,698 2,911 2,512 1,000 2,140 2,026 1,000 642 1,323 1,557 60.3% 1,208 0 500
Slide 13: Consolidated non interest income, expense
HAR Consolidated non interest income, expense Non interest incomes Non interest expenses HUF bn +13.6% HUF bn +16.5% 160 Other 250 CAGR: 9.1% CAGR: 15.0% 10 140 13 200 120 Insurance 17 55 incom e 88 100 150 72 60 P roperty 61 80 53 transactions 8 42 100 43 60 Forex trading 41 18 1 16 40 50 16 62 71
Slide 14: Consolidated loans, deposits
Consolidated loans, deposits Loans Foreign: 22.3% 1.3% 15.3% 22.0% 1.2% 14.2% 1,600 RoBank 1,400 211 DSK Ba nk 188 1,200 OBS HUF bn 1,000 63 OTP Mortg. Ba nk 115 770 55 744 105 HIF 800 600 Me rk antil Car 400 807 745 Me rk antil Bank 200 371 362 OTP Building Soc. 0 95 0 89 0 OTP F a ktoring Corporat
Slide 15: Quality of consolidated loans
HAR Quality of consolidated loans Consolidated qualified loans Provisions, coverage HUF bn HUF bn 360 360 45% 320 320 40% 57 61 60 280 59 280 35% 58 20 20 23 240 19 25 240 27.6% 30% 26 27 22 26 Qualified receivables as 25.9% 25.0% 25.1% 200 25 % of total receivables 200 23.2% 25% 324.6 327.4 334.6 1
Slide 16: Consolidated provisions, loan quality
HAR Consolidated provisions, loan quality Provisions Qualified/total receivables HUF bn 18% 20 18.3 +36.3% Ba d 15% 16 2.8% 12.9 13.4 12% 4.7% 2.4% Doubtful 12 9% 8 6% Be low 10.0% 8.9% a v e ra ge 4 3% 7.6% 0 0% Wa tch 12M 02 12M 03 12M 04P 2002 2003 2004 Provisions/avg. total receivables Provision
Slide 17: Consolidated retail business
HAR Consolidated retail business Group retail loans Consolidated retail loans on Dec 31, 2004 HUF bn HUF bn 770.3, 49% Consolida te d O TP Bank 1,500 60% re ta il loa ns O TP Building Society 1,200 50% Re ta il loa ns Merkantil Group group m a rk e t 900 40% sha re * O TP Mortgage Bank 26.7, 2% 600
Slide 18: Mortgage Loans at OTP Group
Mortgage Loans at OTP Group Cumulative HUF bn Monthly 900 43.8 43.2 45 40.4 38.9 800 40 40 37 34 24 35.3 47 46 34.7 34.9 35.2 34.9 50 34.5 56 53 700 32.9 71 35 32.2 32.1 72 31.2 69 29.6 71 29.4 600 28.5 69 28.2 770 30 70 757 26.3 25.0 82 751 24.0 745 500 77 25 733 82 20.9 726 76 715 400 18.5 703 20
Slide 19: OTP Mortgage Bank selected data
OTP Mortgage Bank selected data All data as of December 31, 2004 Distribution of mortgage portfolio by size Distribution of mortgage portfolio Distribution of portfolio by maturity by purpose Average: HUF4.34 mn Average: 18 years 12.3% 25.2% 1 - 5 21.5% 21.5% 3.7% years Hom e building 18.9% up to HU
Slide 20: Representative margin on mortgage loans
Representative margin on mortgage loans before after after Validity 16 June 2003 16 June 2003 22 December 2003 8%2 (max. GBBY * 1.1 + Rate paid by customer 6% (4+2%) max. 5% (3+2%) max. 4% - GBBY * 0.6) 10% (CMB coupon + Liability side subsidy 9.03% (GBBY * 1.05) 5.16% (GBBY* 0.6) 2% but max. 10%) 1
Slide 21: Consolidated corporate business
HAR Consolidated corporate business Group corporate loans Consolidated corporate loans on Dec 31, 2004 HUF bn HUF bn 11.8, 1% 16.7, 2% O TP Bank 1,000 20% 63.1, 6% 2.9, 0% Merkantil Group 800 16% 114.8, 11% O BS 600 12% Consolida te d corp loa ns D SK 400 8% HIF 200 4% Group ma rk e t 36.3, 3% sha r
Slide 22: Consolidated municipal business
HAR Consolidated municipal business Group municipal loans Consolidated municipal loans on Dec 31, 2004 HUF bn HUF bn 0.2, 0% 100 59% 0.4, 0% O TP Bank Consolida ted 80 57% municipal loa ns 1.1, 1% O TP Building Society 60 55% O BS 40 53% 0.1, 0% Group ma rk et sha re * 20 51% D SK 0 49% 31-D ec- 31-
Slide 23: Consolidated market shares (1)
Consolidated market shares* (1) (at December 31, 2004) Total assets Housing and mortgage loans Total deposits OTP Group, 25.8% Ba nk Ba nk sy ste m sy ste m , 69.2% 0.5% 46.5% 0.5% 1.2% OTP Bank OTP Group system, Group, 30.8% 74.2% 53.5% Total loans Corporate loans Total retail deposits OTP OTP Grou
Slide 24: Consolidated market shares (2)
Consolidated market shares* (2) (at December 31, 2004) Municipal deposits Car loans Insurance (at Sep 30, 2004) OTP OTP Group, Group, 70.5% OTP 9.3% Group, 20.0% 0.2% Ba nk 0.1% sy ste m, Ba nk 29.5% n.c. sy ste m , Bank 90.7% sy stem, 80.0% Life insurance Investment funds Private pension funds (at
Slide 25: Market shares of subsidiaries (in their own country)
Market shares of subsidiaries (in their own country) (at December 31, 2004) Mortgage Bank DSK Bank OTP Banka Slovensko by loan volume by deposits by deposits DSK, OBS, OTP MB, 2.6% 15.0% 61.2% Ba nk Othe rs, sy ste m, 38.8% 85.0% 0.9% Ba nk 2.1% sy ste m, 0.1% 97.4% Mortgage Bank DSK Bank OTP Banka
Slide 26: Profits of consolidated subsidiaries
HAR Profits of consolidated subsidiaries Change Change Change in HUF million 4Q 2003 3Q 2004 4Q 2004 Q-o-Q Y-o-Y 2003 2004P Y-o-Y Merkantil Bank Ltd. 748 702 725 3.3% -3.1% 2,646 3,115 17.7% Merkantil-Car Ltd. 454 275 211 -23.3% -53.5% 1,452 1,458 0.4% Merkantil Bérlet Ltd. 48 56 57 1.8% 18.8% 159 3
Slide 27: Equity, CAR
HAR Equity, CAR HUF bn Equity, gearing Book value per share HUF 400 11.4% 1,500 Bank Consolidated 1,391 11.0% 1,335 1,300 1,241 350 10.9% 11.0% 1,165 1,138 1,161 1,090 1,070 10.7% 1,100 990 935 300 10.6% 900 700 250 10.2% 500 10.0% 300 200 9.8% 31- De c-03 31-Ma r- 04 30-Jun- 04 30- Se p- 04 31- De
Slide 28: Efficiency, productivity
HAR Efficiency, productivity HUF mn HUF mn 450 17,500 16 18,000 14.7 391.5 14.5 400 16,000 13.0 352.7 355.9 14 16,000 345.7 343.7 13.2 350 14,500 300 13,000 12 14,000 249.2 250 11,500 16,997 224.5 210.5 215.2 205.0 10 12,000 17,150 17,074 200 10,000 16,707 8.3 13,768 150 8,120 8,500 8 7.4 10,000 7,9
Slide 29: Performance indicators
HAR Performance indicators Non-interest vs. total income Cost income ratio 46% 65% 62.0% 44.0% 44% 43.1% 43.3% 42.8% 42.8% 60% 42.0% 42% 55.7% 55% 54.1% 52.7% 40% 51.9% 50.6% 50% 47.9% 38% 37.2% 37.2% 37.4% 36.8% 36% 45% 42.8% 42.2% 40.7% 34% 40% 2003 3M2004 1H2004 9M2004 2004 2003 3M2004 1H2004 9M2
Slide 30: ROA, ROE
HAR ROA, ROE ROAE annualized ROAA annualized 45% 4.5% 41.7% 39.6% 39.6% 40.4% 4.24% 40% 39.1% 38.1% 4.15% 35.7%36.3% 35% 30.6% 4.0% 30.6% 30% 3.71% 3.63%3.61% 25% 3.57% 3.53% 3.5% 20% 34.6% 3.28% 33.4% 31.3% 15% 28.9% 25.9% 10% 3.0% 2.78% 5% 2.66% 25.9% 32.8% 32.0% 32.6% 29.5% 0% 2.5% 2003 1Q 04 1H
Slide 31: OTP Group at a glance (IFRS)
OTP Group at a glance (IFRS) (as at or for the year ending 31 December 2004) Net Non Non HUF billion Total interest NII after interest interest Pre-tax Assets Loans Deposits Equity income provisions income expenses profits OTP Bank 3,054.2 1,296.3 2,340.9 389.4 151.1 142.5 139.9 134.1 148.3 Merkanti
Slide 32: DSK in 2004: aggressive growth
IFRS DSK in 2004: aggressive growth BGN millions Total assets Net revenues * +35% 3,221 +30% +46% 3,116 245.4 247.3 2,389 +48% 2,019 167.6 145.7 2002 2003 2004 2004f 2002 2003 2004 2004f Operating profit (no restructuring Operating costs and tax) +17% 121.9 +9% 113.5 123.4+96% 104.6 116.1 91.8 +84%
Slide 33: Acquisition activity
Acquisition activity HUF/IFRS SK BG OBS DSK Market share by total assets 2.61% 14% PL Total assets 214.9 bn 410.7 bn CZ Total equity 15.0 bn 54.3 bn Ukraine After tax profit 510.7 mn 11.735 mn 2002 ROA 0.31% 2.58% SK ROE 3.4% 20.6% Customers 280,000 6 mn Branches 58 319 HU SL Moldova Year of acquisi
Slide 34: Management's 2005 HAR projections
Management’s 2005 HAR projections
Slide 35: 2005 HAR projections
2005 HAR projections Bank Consolidated with Nova banka Balance sheet related growth rates HUF bn Growth rate HUF bn Growth rate 2005 2005/2004 2005 2005/2004 Total assets 3,526.8 15.8% 5,306.2 26.8% Total loans 1,394.6 9.6% 3,255.5 26.1% Corporate loans 861.7 6.8% 1,085.6 16.9% Retail loans 423.9 14
Slide 36: DSK Bank 2004/2005 financial targets
DSK Bank 2004/2005 financial targets Financial indicators 2004 2004 / 2005 2005P/ 2003 (BGN millions) Preliminary 2003 % Planned 2004 % Balance sheet Total assets 2,396 3,233 35 4,338 34 Total loans 1,217 2,131 75 3,037 43 Retail 994 1,678 69 2,373 41 Total deposits 2,041 2,638 29 3,252 23 Retail 2,