Eurobank S.a. · ATHEX:EUROB
Eurobank — Eurobank Ergasias Services and Holdings — FY2020 Earnings Presentation
62 slides from Eurobank's earnings presentation, Mar 10, 2021
Slide 1: FY 2020 Results
emassnia Holdings FY 2020 Results 10 March 2021
Slide 2: Disclaimer
Disclaimer By attending the meeting where this presentation is made, or by reading the presentation slides, you agree to be bound by the following limitations: This presentation has been prepared by Eurobank Ergasias Services and Holdings S.A. (“Eurobank Holdings”) and its 100% subsidiary Eurobank S
Slide 3: Table of contents
A) urobank Table of contents votes > 2020 operating performance 3 > 2021-2022 business update 6 > FY2020 results highlights 11 > Segmental analysis 17 > FY20 results review 22 > Asset Quality 29 > ESG commitments and performance 35 Appendix! — Supplementary information 39 Appendix Il — Macroeconomic
Slide 4: 2020 operating performance
2020 operating performance Page 3
Slide 5: 2020: Facing the COVID-19 pandemic challenge
2020: Facing the COVID-19 pandemic challenge Pandemic economic shock alleviated by strong policy Eurobank initiatives support (EU and domestic) Contained unemployment Protect health & safety of our employees, with over 60% working System deposit increase by c€20bn remotely Ample liquidity (s
Slide 6: Operating performance delivery
Operating performance delivery Group Figures €7.3bn NPEs stock reduction 2020 Core PPI up 3% vs initial guidance; up 4% vs FY19 830 840 865 € bn 13.0 (7.3) 5.7 1 FY19 FY20 e FY20 FY19 FY20 NPE ratio down by 15.2ppts; coverage up by 6.6ppts Texas Ratio2 improved by ~30ppts +6.6ppts 61.9% 55.3% Provis
Slide 7: 2021-2022 business update
2021-2022 business update Page 6
Slide 8: NPE reduction plan, 2021-2022
NPE reduction plan, 2021-2022 Launching a new securitization (Mexico) in 2021 of ~€3.3bn perimeter (~85% Retail, ~15% Corporate) New securitization to drive the NPE ratio to single digit by end 2021 Texas ratio1 post securitization at ~36% vs 63% at FY20 Balance sheet clean up improves quali
Slide 9: 2021 Profitability drivers
2021 Profitability drivers Δ y-o-y (~3%) ~+10% flat ~+4% ~+1% Negative impact from NPEs deconsolidation mitigated by funding (TLTRO) and new loans generation ~€875 m €865 m OPEX Greece Bancassurance, network activities, credit cards and rental income EPS1 ~€0.10 RoTBV1 ~7% FY20 Core PPI NII Greece F
Slide 10: Total CAD, 2021-2022
Total CAD, 2021-2022 FLB3 12.0% ~12.8% ~13.7% CET1 16.3% ~180bps ~16.6% ~120bps 16.0% ~100bps ~(60bps) 1 ~(70bps) ~(30bps) ~(50bps) ~(50bps) ~(20bps) ~(30bps) ~(60bps) Loan growth & other 2 2 FY20 FY21 IFRS 9 transitions FY21 PBT FY22 PBT IFRS9 transitions DTC amortization DTC amortization Loan grow
Slide 11: Financial goals, 2021-2022
Financial goals, 2021-2022 2021 2022 RoTBV1 ~7% ~10% EPS1 ~€0.10 ~€0.15 TBV/S ~€1.40 ~€1.50 C/I ~50% ~50% CoR ~130bps ~60bps NPE ratio ~9.0% ~6.0% FLB3 CET1 ~12.8% ~13.7% Total CAD ~16.0% ~16.6% >100bps organic capital generation p.a. post 2022, paves the way for dividend distribution 1. Adjusted
Slide 12: FY 2020 results highlights
FY 2020 results highlights Page 11
Slide 13: FY20 results
FY20 results Highlights Key financials Net profit1 €544m in FY20; €196m in 4Q20 €m FY20 FY19 Δ(%) 4Q20 3Q20 Δ(%) 1 Core pre-provision income (PPI) up 4.2% y-o-y at €865m; up 1.6% q-o-q Net interest income 1,349.4 1,377.4 (2.0) 329.3 331.3 (0.6) NII down 2.0% y-o-y at €1,349m; down 0.6% q-o-q Com
Slide 14: Pre-provision income (PPI)
Pre-provision income (PPI) Core PPI and other income (€ m) Δ PPI (q-o-q, € m) 28 3 63 184 197 Other income 213 212 224 213 216 13 57 60 397 14 413 68 65 59 SEE (8) (2) 166 Greece 145 147 154 157 4Q19 1Q20 2Q20 3Q20 4Q20 PPI per region (€ m) 413 397 58 63 Δ ΝΙΙ 3Q20 PPI 3Q20 PPI Δ other income Δ comm
Slide 15: Asset quality
Asset quality NPEs formation1 (€ m) NPEs ratio (%) 29.2% 28.9% 33 57 (24) SEE (5) (46) Greece (77) 15.3% 14.9% (15.2ppts) 14.0% (342) 4Q19 1Q20 2Q20 3Q20 4Q20 4Q19 1Q20 2Q20 3Q20 4Q20 Loan loss provisions (€ m) Provisions / NPEs (%) 1.4% 1.3% 1.5% 1.7% 1.6% Cost of Risk2 +660bps 61.9% 155 146 62.5%
Slide 16: Capital position
Capital position 10bps 20bps 16.3% 50bps 15.6% (10bps) 2.4% CET1 FBL3: Tier II 12.0% 16.3% 13.9% CET 1 ~530bps buffer over 2021 Total Capital requirement (TSCR) of 11.0% 1 2 3Q20 CAD 4Q20 result Debt Securities at CRR "Quick fixes" Other 4Q20 CAD FVOCI RWAs 39,801 436 40,237 (€ m) Capital 6,198 196
Slide 17: Funding and liquidity
Funding and liquidity Highlights Deposits (€ bn) Deposits in Greece increased by €1.7bn in FY20; €0.7bn q-o-q 83.2% 83.4% 81.6% Group Deposits up by €2.4bn in FY20; up €1.1bn q-o-q 80.1% 79.1% Net Loans / Deposits ratio LCR ratio at 124% in 4Q20, improved from 107% in 2Q20 47.3 Repos at €0.7
Slide 18: Segmental analysis
A) urobank Holdings Segmental analysis | Page 17
Slide 19: Eurobank Group segmental analysis
Eurobank Group segmental analysis: Earnings generation diversified in different segments in Greece and regionally Key metrics (FY20) Net profit1 (q-o-q, € m) Net 171 Assets RWAs TBV 2019 Profit1 RoTBV (€ bn) (€ bn) (€ m) RoTBV 135 (€ m) 61 Greek 21 12 Greek banking Banking 49.7 31.7 2,906 379 10.3%
Slide 20: Eurobank Investment Real Estate Portfolio
Eurobank Investment Real Estate Portfolio Big boxes & FY20 Office Mixed use Retail Logistics Special use Total supermarkets No. of assets (#) 44 17 76 45 9 11 202 Market Value (€ m) 392 201 162 433 86 61 1,335 % of total MV 29% 15% 12% 32% 6% 5% 100% Price / GLA (€ /sqm) 1,347 2,161 1,666 1,104 573
Slide 21: Bulgaria key metrics
Bulgaria key metrics1 FY20 Highlights PPI and provisions (€ m) Net profit €67m in FY20; €13m in 4Q20 Core pre-provision income (PPI) down 9% y-o-y at €121m; down 4% q-o-q 32 29 31 26 24 NII down 2% y-o-y at €181m; down 1% q-o-q PPI (16) (9) (11) (10) Commission income down 2% y-o-y at €53m;
Slide 22: Cyprus key metrics
Cyprus key metrics1 FY20 Highlights PPI and provisions (€ m) Net profit €64m in FY20; €12m in 4Q20 Core pre-provision income (PPI) down 7% y-o-y at €88m; stable q-o-q 25 26 26 23 22 PPI NII down 1% y-o-y at €102m; stable q-o-q (2) (1) (6) Commission income down 6% y-o-y at €27m; up 8% q-o-q
Slide 23: FY 2020 results review
FY 2020 results review Page 22
Slide 24: Balance Sheet composition
Balance Sheet composition Assets (€ bn) Liabilities and Equity (€ bn) 67.7 67.7 Equity 5.2 Net loans and 37.4 advances to customers Trading & • Core 67% other Tbills Deposits 47.3 Other • Time 33% issuers 2% 1% 18% Securities GGBs 8.4 47% PP&E, intangibles and other assets 4.8 Other Derivatives 2.6
Slide 25: Loans
Loans Gross loans (€ bn) Performing loans (€ bn) +2.1bn organic loan growth 44.4 45.0 +4.01 35.2 34.5 34.7 7.7 40.6 40.7 40.9 7.6 31.8 31.2 7.5 SEE 7.3 7.4 1.1 1.1 7.8 8.0 8.1 7.1 SEE 7.0 Greece 3.5 3.5 3.5 Greece 3.5 3.5 3.5 1.1 Senior notes 1.1 +1.5 14.2 Senior notes 20.5 21.0 13.7 16.7 16.7 17.0
Slide 26: Net interest margin & spreads
Net interest margin & spreads Net interest margin (bps) Deposit spreads (Greece, bps) 4Q19 1Q20 2Q20 3Q20 4Q20 4Q19 1Q20 2Q20 3Q20 4Q20 Greece 200 194 204 188 187 Savings & Sight (60) (55) (55) (59) (62) SEE 265 255 231 226 219 Time (71) (66) (59) (55) (58) Group 215 208 210 197 195 Total (64) (59)
Slide 27: Net interest income
Net interest income NII breakdown (€ m) NII evolution (q-o-q, € m) Total NII 347 339 349 331 329 o/w Greece 247 244 260 240 239 4 o/w SEE 100 96 90 91 90 0 331 (1) (2) 329 (2) (1) 378 367 364 349 348 Loan margin Eurosystem 5 10 0 0 10 Bonds & other 59 58 60 57 55 3Q20 Deposits SEE 3Q202 Bonds & othe
Slide 28: Commission income
Commission income Commission income breakdown (€ m) Commission income per region (€ m) 64bps over assets 109 109 104 104 95 22 Lending 95 21 92 92 26 SEE 88 28 88 15 16 24 19 26 23 34 Network transactions & credit cards 39 31 37 83 Greece 29 17 71 Capital Markets 5 11 7 76 6 64 Bancassurance & 66 20
Slide 29: Operating expenses
Operating expenses OpEx per region (€ m) OpEx breakdown (€ m) Greece (6.0%) 901 (3.6%) 869 237 109 109 220 222 213 213 Depreciation 60 57 56 56 57 SEE 312 317 Administrative 178 163 158 157 165 Greece 481 Greece staff cost Staff 443 (11.8%) 4Q19 1Q20 2Q20 3Q20 4Q20 FY19 FY20 Cost-to-income ratio (%)
Slide 30: Asset Quality
Holdings Asset Quality | Page 29
Slide 31: Loans under payment moratoria (Greece)
Loans under payment moratoria (Greece) 1 Payment moratoria in Greece2 Payment segmentation post moratoria €4.9bn Gefyra I&II 20% Step-up programmes 5% Expired FY20 €3.3bn Moratoria €4.9bn expiring FY21 Regular 13% Household 48% payment Corporate 42% €4.9bn 29% At risk Small business 20% 23% Expiring
Slide 32: Δ stock NPEs (€m)
Δ stock NPEs (€m) 30 (883) (130) (343) Δ stock NPEs Group (6,784) 22 (722) (112) (287) Δ stock NPEs Solo (6,805) NPE inflows 164 152 132 84 111 (117) (103) (81) NPE outflows (205) (53) (41) (46) (340) (65) Cash Payments (86) (118) (38) (60) (19)(16) (262) (15) (45) (12) (3) (64) (57) (82) (270) NPE
Slide 33: NPEs formation per segment (Greece)
NPEs formation per segment (Greece) Mortgages (€ m) Consumer (€ m) 22 (17) 7 (24) 4 2 (41) 1 (67) (57) (80) (66) (81) (83) (85) (2) (4) (105) (3) (2) (5) (123) (9) (10) 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 3Q18 1Q18 2Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 Small busin
Slide 34: NPEs metrics (Group)
NPEs metrics (Group) 90dpd bridge to NPEs (€ bn) NPEs per region Provisions & Provisions/ Total NPEs NPEs ratio collaterals / NPEs NPEs 0.2 (€ bn) (%) (%) (%) 5.7 Consumer 0.7 30.1 101.9 114 1.2 Mortgages 1.6 16.1 48.3 130 4.3 Small Business 1.0 25.4 62.2 128 Total Retail 3.3 20.3 63.5 126 Corporate
Slide 35: Loans’ stage analysis (Group)
Loans’ stage analysis (Group) Loans’ stage breakdown Provisions stock over NPEs Δ 62.5% 61.9% (€ bn) 4Q19 1Q20 2Q20 3Q20 4Q20 55.3% 55.6% 60.6% q-o-q Stage 1 25.2 25.7 28.3 28.8 28.7 (0.1) Stage 2 6.3 6.2 6.1 5.8 6.4 0.6 Stage 3 13.0 13.0 6.2 6.1 5.7 (0.4) (NPEs) 1 Total 44.5 44.9 40.5 40.7 40.9 0.2
Slide 36: ESG commitments and performance
ESG commitments and performance Page 35
Slide 37: Performance
Performance 67% reduction of GHG emissions from 2014 to 2020 & 31% reduction of Energy Consumption from 2014 to 2020 Climate profile 19 green buildings, LEED (gold & platinum ratings) or BREEAM (good, very good & excellent ratings) certified 57% reduction of paper procured from 2014 to 2020 Pa
Slide 38: ESG roadmap
ESG roadmap Achievement of annual Signatory to the Gender diversity absolute energy and UNEP FI PRB at BOD emissions reduction target Dec 2017 Dec 2018 Jun 2019 Oct 2019 Nov 2020 Nov 2020 2021 onwards Key milestones going forward: Issue of the Sustainable Bond Redesigned Achievement of annual Publ
Slide 39: ESG ratings and regulations
ESG ratings and regulations ESG ratings Key regulations & standards Eurobank is included in all major Indexes The EU Sustainable Finance Action Plan The action plan is part of the European Green Deal and entails 10 regulations that lead financial service market participants to invest in sustainable
Slide 40: Appendix I – Supplementary information
Appendix I – Supplementary information Page 39
Slide 41: Summary performance
Summary performance Balance sheet – key figures Income statement – key figures €m 4Q20 3Q20 €m 4Q20 3Q20 Gross customer loans 40,874 40,694 Net interest income 329.3 331.3 Provisions (3,477) (3,734) Commission income 108.8 95.1 Loans FVTPL 27 28 Operating income 635.1 610.8 Net customer loans 37,424
Slide 42: Consolidated quarterly financials
Consolidated quarterly financials Income Statement (€ m) 4Q20 3Q20 2Q20 1Q20 4Q19 Net Interest Income 329.3 331.3 349.5 339.4 346.7 Commission income 108.8 95.1 87.8 92.3 103.8 Other Income 197.0 184.3 63.4 2.7 28.2 Operating Income 635.1 610.8 500.6 434.4 478.7 Operating Expenses (221.7) (213.4) (2
Slide 43: Consolidated financials
Consolidated financials Income Statement (€ m) FY20 FY19 Δ y-o-y (%) Net Interest Income 1,349.4 1,377.4 (2.0) Commission income 384.1 353.7 8.6 Other Income 447.5 112.8 >100 Operating Income 2,180.9 1,843.9 18.3 Operating Expenses (868.8) (901.3) (3.6) Pre-Provision Income 1,312.1 942.6 39.2 Loan L
Slide 44: SEE operations key figures – 4Q20
SEE operations key figures – 4Q201 Bulgaria Cyprus Serbia Lux Sum Assets 6,010 6,852 1,691 1,892 16,445 Gross loans 4,053 2,019 1,225 535 7,832 Net loans 3,917 1,974 1,181 534 7,606 Balance Sheet (€m) 90dpd Loans 139 41 22 0 202 Balance NPE loans 273 74 72 0 419 Sheet Deposits 5,228 5,462 948 1,462
Slide 45: Gross loans (SEE, € m)
Gross loans (SEE, € m) Bulgaria Cyprus 3,898 3,988 4,053 2,019 3,801 3,856 1,953 1,983 1,874 1,910 575 617 632 155 164 168 Other 528 547 149 151 Consumer 1,075 1,089 1,114 1,150 1,167 Mortgage 1,725 1,759 1,798 1,819 1,851 Business Business 2,198 2,220 2,209 2,221 2,254 4Q19 1Q20 2Q20 3Q20 4Q20 4Q19
Slide 46: Deposits (SEE, € m)
Deposits (SEE, € m) Bulgaria Cyprus 5,501 5,578 5,438 5,462 5,228 5,418 4,821 4,684 4,696 4,897 1,636 Time 2,335 2,190 2,034 1,930 Time 1,628 2,451 1,670 1,619 1,601 3,269 3,593 Core 3,532 3,150 3,064 3,096 3,050 3,242 3,248 3,384 Core 4Q19 1Q20 2Q20 3Q20 4Q20 4Q19 1Q20 2Q20 3Q20 4Q20 Serbia Luxembo
Slide 47: Appendix II – Macroeconomic update
Appendix II – Macroeconomic update Page 46
Slide 48: Recent macro & market developments and FY-2021 outlook
Recent macro & market developments and FY-2021 outlook The FY-2020 real GDP growth rate stood at -8.2% from 1.9% in 2019; this result was better relative to EC’s winter forecasts (-10.0%). For 2021 and 2022 EC projects a recovery of 3.5% and 5.0% respectively 2020 2020 2021* 2022* GDP €bn nominal
Slide 49: Real Gross Domestic Product
Real Gross Domestic Product Annual Real GDP Growth Rate ELSTAT’s 1st estimate: FY20 real GDP decline of (% YoY and contribution in ppts of the demand components) -8.2%, from +1.9% in 2019 This result was better relative to EC’s winter forecasts (-10.0%) Real FY % YoY 2019 2020 Gross Domestic Pro
Slide 50: Selected indicators of domestic economic activity
Selected indicators of domestic economic activity Dive of Economic Sentiment in the first wave of PMI manufacturing index slightly below the 50 units no-change the pandemic, mild recovery afterwards threshold in Feb-21 (well below the Euro Area) Due to the 2nd lockdown the retail trade The manufactu
Slide 51: Domestic Labour Market
Domestic Labour Market Despite the deep recession, the average unemployment rate Government support policies led to a relatively mild dropped to 16.5% in Jan-Nov 2020 from 17.4% in Jan-Nov 19 decrease of employment (in number of persons) Long term unemployment as a percentage of total unemployment T
Slide 52: Real Estate prices continued to increase in 2020
Real Estate prices continued to increase in 2020 Index of Apartment Prices Index of Retail and Office Prices 2008Q4 – 2020Q4 2010H – 2020H1 Source: BoG Page 51
Slide 53: Domestic fiscal measures and liquidity support: ca 15% of GDP
Domestic fiscal measures and liquidity support: ca 15% of GDP 2021 Budget: total measures against the pandemic for 2020 (2021) at €-23.9bn (€-7.6bn); the most recent 9th Enhanced Surveillance Review (and the Ministry of Finance) revise the 2021 measures upwards to €-11.6 bn (February 2021) Public In
Slide 54: Primary fiscal balance negative for second consecutive year
Primary fiscal balance negative for second consecutive year due to support measures against the pandemic 2016-2019: four consecutive years with an overall surplus in programme terms; turned into sizable deficit in 2020 2021 Budget Forecasts: o Primary balances for 2020, 2021 and likely 2022 nega
Slide 55: European policy response
European policy response European level stimulus Additional European Commission measures Next Generation EU Multi Year Financial Unemployment fund Framework 2021–27 • ESM credit line: up to 2% of GDP for each Eurozone country initiative (SURE) Loans €100bn €360 bn • Coronavirus Response Investment I
Slide 56: Bulgaria-Cyprus-Serbia macro-trajectory for 2020-2021
Bulgaria-Cyprus-Serbia macro-trajectory for 2020-2021 Pandemic-induced recession turned out lower than expected Covid-19 induced recession turned out milder in 2020 for regional economies than initially expected Bulgaria’s EU & Cyprus’ EMU membership enable access to EU and ECB assistance; both
Slide 57: Appendix III – Glossary
Appendix III – Glossary Page 56
Slide 58: Glossary – Definition of Alternative Performance Measures (APMs)
Glossary – Definition of Alternative Performance Measures (APMs) & other selected financial measures/ ratios This document contains financial data and measures as published or derived from the published consolidated financial statements which have been prepared in accordance with International Finan
Slide 59: Glossary – Definition of Alternative Performance Measures (APMs)
Glossary – Definition of Alternative Performance Measures (APMs) & other selected financial measures/ ratios Adjusted net profit: Net profit/loss from continuing operations after deducting restructuring costs, goodwill impairment, gains/losses related to the transformation plan and income tax adjust
Slide 60: Glossary – Definition of Alternative Performance Measures (APMs)
Glossary – Definition of Alternative Performance Measures (APMs) & other selected financial measures/ ratios Liquidity Coverage Ratio (LCR): The total amount of high quality liquid assets over net liquidity outflows for a 30-day stress period. Loans to Deposits: Loans and Advances to Customers at am
Slide 61: Glossary – Definition of Alternative Performance Measures (APMs)
Glossary – Definition of Alternative Performance Measures (APMs) & other selected financial measures/ ratios Provisions/NPEs ratio: Impairment Allowance for Loans and Advances to Customers, including impairment allowance for credit related commitments (off balance sheet items) divided by NPEs at the
Slide 62: Investor Relations contacts
Investor Relations contacts Dimitris Nikolos +30 214 4058 834 E-mail: dnikolos@eurobankholdings.gr Yannis Chalaris +30 214 4058 832 E-mail: ychalaris@eurobankholdings.gr Christos Stylios +30 214 4058 833 E-mail: cstylios@eurobankholdings.gr E-mail: investor_relations@eurobankholdings.gr Fax: +30 210
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