Procredit Holding Ag · XETR:PCZ
Procredit — Q1 2021 Earnings Presentation
41 slides from Procredit's earnings presentation, May 12, 2021
Slide 1: Q1 2021 results
Dr Gabriel Schor, Member of the Management Board Christian Dagrosa, Manager Q1 2021 results Frankfurt am Main, May 2021
Slide 2: Agenda
Agenda A Highlights B Group results C Asset quality D Balance sheet, capital and funding Q&A Appendix ProCredit Group | Q1 2021 results | Frankfurt am Main, 12 May 2021 1
Slide 3: Highlights Q1 2021
Highlights Q1 2021 Good start into the year 2021 reflected both in strong loan and deposit growth despite still challenging conditions ► Customer loans grew by 3.0%, underpinning strong positioning ► Customer deposits grew by 2.5%, achieved through business and private client sight deposits ► Green
Slide 4: Key recent developments and outlook for our countries of operations
Key recent developments and outlook for our countries of operations Overview of regional presence in SEE/EE COVID-19 pandemic and governmental response ► Infection rates in early 2021 continue to be at elevated levels in almost all ProCredit markets ► Vaccination programs moving ahead, albeit at a s
Slide 5: Steady development in customer loans
Steady development in customer loans Loan portfolio growth in 2021 ► Strong growth in customer loans continued in Q1-21 +3.0% (EUR 158m/3.0%) 33 5,412 34 91 19% Continued lending to business clients resulting in 5,254 increased market share as overall business lending still 47% somewhat muted Al
Slide 6: Good deposit development through digital banking channels
Good deposit development through digital banking channels ► YOY increase of EUR 763m (+18%) Deposits by product Achieved mostly through growth in business clients, also private client deposits increasing visibly (+ EUR 198m) 5,022 Increased share of sight deposits and FlexSave 4,259 (up 5pp YoY
Slide 7: Q1 2021 results versus guidance
Q1 2021 results versus guidance Guidance Actual FY 2021 Q1 2021 ► Growth of the loan portfolio c. 10% 3.0% ► Return on equity (RoE) 6.0 – 7.5% 7.9% assuming still elevated cost of risk, but slightly lower than in 2020 ► Cost-income ratio (CIR) 65 – 68% 64.8% ► CET1 ratio and leverage ratio c. 13% a
Slide 8: Agenda
Agenda A Highlights B Group results C Asset quality D Balance sheet, capital and funding Q&A Appendix ProCredit Group | Q1 2021 results | Frankfurt am Main, 12 May 2021 7
Slide 9: Q1 2021 results at a glance
Q1 2021 results at a glance In EUR m Q1-2020 Q1-2021 y-o-y Net interest income 50.9 49.3 -1.6 Net fee and commission income 12.0 12.0 0.0 Other operating income (net) 1.8 1.6 -0.2 Operating income 64.7 62.8 -1.9 Income Personnel expenses 20.6 21.0 0.4 statement Administrative expenses 21.2 19.8 -1.5
Slide 10: Net interest income
Net interest income ► Stable underlying net interest income as a result of strong loan growth (Q1-21: 3.0%) and slightly reduced NIM 3.1% 2.9% 2.9% 2.8% 2.7% Increased NII for most banks in spite of reduced base rates in many countries of operation 50.9 50.8 50.8 49.0 49.3 Ukraine in particular
Slide 11: Drivers of interest income in Q1 2021
Drivers of interest income in Q1 2021 Overview of main drivers ► Stable positive developments during Q1-21, mainly as a result of increased volume effects (net assets and liabilities) based on continued strong loan portfolio growth (+3.0% in Q1-21) stable pricing effects (net assets and liabilit
Slide 12: Provisioning expenses
Provisioning expenses ► Q1-21 loan loss provisioning expenses at EUR 3.6m, 71 bps corresponding to 27bps; overall below the levels in 2020 Q1-21 expenses driven primarily by stage 3 loans 57 bps 57 bps (EUR 4.6m) as well as loan growth (EUR 1.8m) Recoveries of written-off loans remained at a ste
Slide 13: Net fee and commission income
Net fee and commission income ► Q1-21 net fee and commission income stable on previous 12.7 year level, however, seasonally lower than in Q4-20 12.0 12.1 10.6 12.0 • Compared to Q1-20, increase in income from payment and card services compensating decrease in account maintenance fees and fee expense
Slide 14: Operating expenses
Operating expenses 72.4% ► Operating expenses in Q1-21 slightly below level of Q1-20, 64.6% 68.4% 66.7% 64.8% with cost-income ratio stable YOY at 64.8% General and administrative expenses reduced versus 22.4 Q1-20 in part due to reduction in travelling expenses 20.7 (EUR 0.7m) 20.6 20.7 21.0 Pe
Slide 15: Contribution of segments to group net income (Q1 2021)
Contribution of segments to group net income (Q1 2021) Group functions, e.g. risk management, reporting, capital management, IT, liquidity management, training and development Includes ProCredit Holding, Quipu, ProCredit Academy Fürth, ProCredit Bank Germany (EUR 52m customer loan portfolio; EUR 275
Slide 16: Agenda
Agenda A Highlights B Group results C Asset quality D Balance sheet, capital and funding Q&A Appendix ProCredit Group | Q1 2021 results | Frankfurt am Main, 12 May 2021 15
Slide 17: Structure of the loan portfolio
Structure of the loan portfolio Loan portfolio by geographical segments Loan portfolio by sector Investment and other loans Ecuador Germany Housing 1% 1% Moldova 6% 5% Bulgaria Wholesale and 3% 21% retail trade Georgia Other 26% 7% economic activities 21% Ukraine 11% Serbia Transportation Bosnia 18%
Slide 18: Loan portfolio quality
Loan portfolio quality IFRS 9 ► Overall, steady development of risk indicators in Q1-21 ► Stage 3 loans at 2.7%, slightly increased vs. Q4-20 in line Net write- 0.3% 0.1% 0.0% with expectations offs ► Stage 2 loans at 4.6%, slightly decreased vs. Q4-20 Coverage despite an increase in restructured lo
Slide 19: Agenda
Agenda A Highlights B Group results C Asset quality D Balance sheet, capital and funding Q&A Appendix ProCredit Group | Q1 2021 results | Frankfurt am Main, 12 May 2021 18
Slide 20: Asset reconciliation
Asset reconciliation ProCredit Group | Q1 2021 results | Frankfurt am Main, 12 May 2021 19
Slide 21: Liabilities and equity reconciliation
Liabilities and equity reconciliation (in EUR m) Debt securities ProCredit Group | Q1 2021 results | Frankfurt am Main, 12 May 2021 20
Slide 22: Regulatory capital and risk-weighted assets
Regulatory capital and risk-weighted assets in EUR m Dec-20 Mar-21 ► Capital ratios well above regulatory capital requirements CET1 capital 706 714 (8.2% CET1 capital, 10.1% T1, 12.6% total capital) Additional Tier 1 capital 0 0 ► CET1 capital includes interim profits for Q1 and Q2 2020 Interim pr
Slide 23: Development of CET1 capital ratio (fully loaded)
Development of CET1 capital ratio (fully loaded) H2-20 attributable profits net of Increase in group’s translation dividend accrual of 1/3; total Loan portfolio growth of Partially decreased excess reserve as consequence of H2-20 attributable profits of EUR 158m (3.0%) liquidity temporarily placed a
Slide 24: Agenda
Agenda A Highlights B Group results C Asset quality D Balance sheet, capital and funding Q&A Appendix ProCredit Group | Q1 2021 results | Frankfurt am Main, 12 May 2021 23
Slide 25: Q&A ProCredit Bank Bulgaria
Q&A ProCredit Bank Bulgaria ProCredit Group | Q1 2021 results | Frankfurt am Main, 12 May 2021 24
Slide 26: Agenda
Agenda A Highlights B Group results C Asset quality D Balance sheet, capital and funding Q&A Appendix ProCredit Group | Q1 2021 results | Frankfurt am Main, 12 May 2021 25
Slide 27: ProCredit – A unique approach to banking
ProCredit – A unique approach to banking Summary Key figures Q1 2021 and FY 2020 ► A profitable, development-oriented commercial group of banks for Total assets Customer loan portfolio Deposit/loan SMEs with a focus on South Eastern Europe and Eastern Europe EUR 7,492m EUR 5,412m 93% ► Headquartered
Slide 28: Overview of quarterly financial development
Overview of quarterly financial development In EUR m Q1-2020 Q2-2020 Q3-2020 Q4-2020 Q1-2021 Net interest income 50.9 49.0 50.8 50.8 49.3 Net fee and commission income 12.0 10.6 12.1 12.7 12.0 Other operating income (net) 1.8 0.1 0.6 0.7 1.6 Operating income 64.7 59.8 63.5 64.2 62.8 Income Personnel
Slide 29: Segment South Eastern Europe
Segment South Eastern Europe Regional loan portfolio breakdown Key financial data Bosnia (in EUR m) Q1 2020 Q1 2021 Albania 6% 6% Net interest income 28.0 29.8 Bulgaria Romania 29% Net fee and commission income 8.3 7.5 9% Other operating income (net) 1.2 1.3 Operating income 37.5 38.6 North Macedoni
Slide 30: Segment Eastern Europe
Segment Eastern Europe Regional loan portfolio breakdown Key financial data (in EUR m) Q1 2020 Q1 2021 Moldova 14% Net interest income 17.3 15.0 Net fee and commission income 2.3 1.8 Other operating income (net) 2.0 0.6 Operating income 21.5 17.4 Ukraine Personnel expenses 3.1 3.0 54% Georgia Admini
Slide 31: Segment South America
Segment South America Regional loan portfolio breakdown Key financial data (in EUR m) Q1 2020 Q1 2021 Net interest income 4.7 4.4 Net fee and commission income -0.1 -0.1 Other operating income (net) 0.0 -0.3 Operating income 4.6 4.0 Ecuador 100% Personnel expenses 1.5 1.4 Administrative expenses 2.7
Slide 32: Development of green loan portfolio
Development of green loan portfolio Green loan portfolio growth ► Green loan portfolio amounting to > EUR 1bn for the first time, representing now 18.8% of total loan portfolio 12.6% 15.4% 16.6% 18.7% 18.8% 985 1,018 ► Q1-21 growth of EUR 33m/3.3%, representing more than 21 22 20% of the group’s tot
Slide 33: 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% 33% 19% 35% 54% 14% 11% 27% < 50k 50-250k 250-500k 500k-1.5m >1.5m EUR USD Other currencies ProCredit Group | Q1 2021 results | Frankfurt am Main, 12 May 2021 32
Slide 34: Structure of collateral
Structure of collateral Collateral by type ► Majority of collateral consists of mortgages ► Growing share of financial guarantees mainly as a result of 19% InnovFin and other guarantee programmes provided by the European Investment Fund ► Clear, strict requirements regarding types of acceptable coll
Slide 35: Funding and rating
Funding and rating Funding sources overview 1% 4% 2% ► Highly diversified funding structure and counterparties 10% ► Customer deposits main funding source, accounting for 75%, Customer deposits supplemented by long-term funding from IFIs and 8% Liabilities to IFIs institutional investors Liabilities
Slide 36: Liquidity update
Liquidity update Liquidity coverage ratio 181% ► LCR at 143%, comfortably above the regulatory minimum 170% 143% ► Increase of HLAs mainly driven by strong deposit growth 100% 100% 100% ► No visible deterioration of liquidity since the outbreak of COVID-19 pandemic Mar-19 Mar-20 Mar-21 LCR Regulator
Slide 37: Balance sheet
Balance sheet in EUR m Dec-20 Mar-21 Assets Cash and central bank balances 1,405 1,413 Loans and advances to banks 237 237 Investment securities 336 337 Loans and advances to customers 5,254 5,412 Loss allowance for loans to customers -123 -130 Derivative financial assets 1 4 Property, plant and equ
Slide 38: Income statement by segment
Income statement by segment 01.01.- 31.03.2021 South Eastern Germany Eastern Europe South America Consolidation Group (in EUR m) Europe Interest and similar income 6 25 37 8 -5 71 of which inter-segment 5 0 0 0 0 0 Interest and similar expenses 6 10 7 4 -5 22 of which inter-segment 0 1 2 1 0 0 Net i
Slide 39: 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 and manage the implementation and further development of the group’s business and risk strategy: The growth of the customer loan portfolio(1) is a key indicator of the succe
Slide 40: Contact Investor Relations
Contact Investor Relations Contact details Financial calendar (continuously updated on IR Website) Investor Relations Date Place Event information ProCredit Holding AG & Co. KGaA Equity Forum 17.-18.05.2021 virtual Investor Relations Team Spring Conference 2021 27.05.2021 virtual Annual General Meet
Slide 41: Disclaimer
Disclaimer The material in this presentation and further supporting This presentation and further supporting documents may contain documents have been prepared by ProCredit Holding AG & Co. forward-looking statements including statements regarding our KGaA, Frankfurt am Main, Federal Republic of Ger