Bank Millennium SA · GPW:MIL
Bank Millennium SA — Investor Presentation (March 2023)
31 slides from Bank Millennium SA's investor presentation, March 2023
Slide 1: Bank Millennium Group Institutional Presentation
BANK MILLENNIUM GROUP INSTITUTIONAL PRESENTATION March 2023 1
Slide 2: Agenda
AGENDA 1. 2. 3. 4. Macroeconomic Banking sector Bank Millennium Financial environment in Poland general overview performance in Poland and strategy 2
Slide 3: Macroeconomic environment in Poland
01 BANK’S PRESENTATION Macroeconomic environment in Poland 3
Slide 4: Macroeconomic Overview: Economy
MACROECONOMIC OVERVIEW Economy Economic growth in Poland slowed to Data from real economy (% y/y) PMI indexes for Poland and Germany (pts) estimated 1.6% y/y in 4Q22 and in the whole year reached 4.7% compared to 6.8% in 2021. High inflation and high interest rates reduced real growth of consumption
Slide 5: Macroeconomic Overview: Financial markets
MACROECONOMIC OVERVIEW Financial markets Evolution of FX rates WIBOR 3M and market expectations (%) The Monetary Policy Council hiked a reference rate to 6.75% in September 2022 and switched to wait-and-see approach that has been adopted due to the mounting risks for economic activity in coming quar
Slide 6: Macroeconomic Overview: Monetary aggregates
MACROECONOMIC OVERVIEW Monetary aggregates Loans to households Mortgage loans Loans to companies Demand for loans is (PLN bn, % y/y) (PLN bn, % y/y) (PLN bn, % y/y) declining both in households’ and corporates’ sector amid high interest rates and lower economic activity. Consumer and mortgage loans
Slide 7: Banking sector in Poland
02 INSTITUTIONAL PRESENTATION Banking sector in Poland 7
Slide 8: Polish Banking Sector Overview
POLISH BANKING SECTOR OVERVIEW (*) 30 fully registered banks, 496 co- Strong resilience during the pandemic crisis – operative banks (active mainly in rural only one bank was subject to resolution areas of the country) and additional 34 procedure (due to pre-pandemic issue), fall- international bank
Slide 9: Bank Millennium is Poland's #7 Bank by Assets
BANK MILLENNIUM IS POLAND’S #7 BANK BY ASSETS As on December 31 2022 (PLN billion) 450 430,7 Loans and advances to clients 420 Debt securities 390 47 360 Other financial assets 330 300 135,6 281,1 Other assets 259,2 270 34 240 217,5 209,9 42 210 9 80,3 180 55,1 48,8 28 151,5 150 55,1 18 120 110,9 23
Slide 10: Recent M&A Transactions in the Polish Banking Sector
RECENT M&A TRANSACTIONS IN THE POLISH BANKING SECTOR Upper logo: Acquirer 1) Lower logo: Acquired entity 1) 2) 2) 2007 2009 2011 2012 2013 2014 2015 2015 2017 2018 2019 2020 1) 1) (*) 1) 2) 2) 2) 3) 3) (*) Most of assets/liabilities of Idea Bank acquired as a part of resolution process at the turn o
Slide 11: Bank Millennium general overview and strategy
03 INSTITUTIONAL PRESENTATION Bank Millennium general overview and strategy 11
Slide 12: History of Bank Millennium at a Glance
HISTORY OF BANK MILLENNIUM AT A GLANCE 1989 1992 1997 1998 2003 2006 2010 2015 Bank Inicjatyw BIG S.A. is the first Merger with Bank Joint venture with BIG Bank GDAŃSKI Change of the Bank's Successful capital Increase of a Gospodarczych BIG bank listed on the Gdański (a regional Portuguese BCP to re
Slide 13: 2022-24 Strategy: Inspired by People
2022-24 STRATEGY: INSPIRED BY PEOPLE For years clients have been at the center Pillars of ’Millennium 24’ strategy: of our thinking. We talk, listen, understand and co-create our solutions together. Now, we are to leverage this approach in even more intensive way … 01 02 03 Top quality and Bank of t
Slide 14: Strategy 2022-2024 Execution
STRATEGY 2022 - 2024 EXECUTION STRATEGIC GOALS: 2021 2022 2024 • Bank is progressing with the execution of its 3-year business Number of active strategy adopted for the period 2022 to 2024. retail clients (thsnd.) 2 694 2 887 >3 000 • Operationalisation of the strategy is based on an intense program
Slide 15: Mortgages – Our Long-Term Customer Acquisition Product
MORTGAGES – OUR LONG-TERM CUSTOMER ACQUISITION PRODUCT Millennium Mortgage Bank (MBH) started operating performance on June 14, 2021 Rationale for establishing MBH Share of mortgage loans in total portfolio (top 9 banks) (%) 80% 4Q21 4Q22 MBH will provide opportunities for medium term sustainable 70
Slide 16: Bank Millennium Today
BANK MILLENNIUM TODAY 2.9 million (*) active retail clients, 6% average market share, of which 7-8% 2.5 million (*) online active clients in retail segment and 4% in corporate 2.2 million (*) mobile active clients business Well developed retail banking Profitability under pressure platform with 635
Slide 17: Market Shares in Main Products
MARKET SHARES IN MAIN PRODUCTS YE18 YE20 YE21 YE22 YE18 YE20 YE21 YE22 Total loans 4.6% 6.1% 6.1% 5.9% Total deposits 5.3% 5.3% 5.5% 5.6% Loans to individuals 5.6% 8.0% 8.2% 8.2% Deposits of individuals 6.2% 6.7% 6.8% 6.8% mortgages 7.0% 8.6% 8.7% 8.6% demand deposits (**) 6.9% 7.2% 7.0% 7.1% • new
Slide 18: Bank Millennium's Physical Footprint
BANK MILLENNIUM’S PHYSICAL FOOTPRINT (as at 31 December 2022) Network of 635 branches: own and mini branches Branches -20 702 678 676 665 655 646 635 633 635 225 225 224 222 215 218 220 224 229 477 453 452 443 440 428 415 409 406 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 Own Partners' outlets Emp
Slide 19: Relations with BCP and BM's Management Composition
RELATIONS WITH BCP AND BM’s MANAGEMENT COMPOSITION Sale of 15.4% through ABB in BCP's stake - evolution since 1998 March’15 2015-2022 50,1% ▪ BCP demonstrated in the past strong support to 2010 BCP subscribed PLN691m during the right issue 65,5% Bank Millennium in Poland; commitment in equity was sh
Slide 20: Solid Foundations Appreciated by Investors
SOLID FOUNDATIONS APPRECIATED BY INVESTORS Bank Millennium's shareholder structure (31.12.2022) Annual change of Bank Millennium share performance vs. WIG Banks index 27,5% - 28% Stable 50,1% - 44% shareholder 5,6% 8,0% 8,9% BCP Nationale-Nederlanden OFE (Pension Fund) Participation in domestic stoc
Slide 21: ESG: Environment
ESG: ENVIRONMENT Sustainability has long been included in our business strategy. Now we plan to become climate neutral Our advanced capabilities in the … will support our leading position on the ESG & Sustainability development … climate neutrality path Strong own emissions’ Reduction of … and striv
Slide 22: ESG: Social
ESG: SOCIAL Banking in Millennium – responsible and without barriers Our strong position has been ... and our aspiration is continue to achieve ambitious goals recognised on the market … in the coming years Best Bank for CSR Customers In CEE 2017 Customer centric service focused on superb quality, f
Slide 23: ESG: Governance
ESG: GOVERNANCE Highest quality and standards Our strong position has been ... and our aspiration is continue to achieve ambitious goals recognised on the market … in the coming years +10 years of membership Ethical approach to business Regularly revised Code of Ethics and compliance assessment Sign
Slide 24: Financial performance
04 INSTITUTIONAL PRESENTATION Financial performance 24
Slide 25: Synthetic P&L Account
SYNTHETIC P&L ACCOUNT SYNTHETIC P&L ACCOUNT Reported results 2021 2022 Change Y/Y 3Q22 4Q22 Change Q/Q Net interest income 2 713 3 337 23% -152 1 349 - Including cost of credit holidays 0 -1 324 - -1 423 99 - Net interest income without credit holidays 2 713 4 661 72% 1 271 1 250 -2% Net commission
Slide 26: Balance Sheet
BALANCE SHEET 31.12.2021 30.09.2022 31.12.2022 Change y/y ASSETS Cash and balances with the Central Bank 3 180 10 132 9 536 200% Loans and advances to banks 771 1 186 733 -5% Loans and advances to customers 78 603 78 965 76 565 -3% Amounts due from reverse repo trans. 269 5 5 -98% Debt securities 18
Slide 27: Financial Highlights of 4Q22 and FY2022
FINANCIAL HIGHLIGHTS OF 4Q22 and FY2022 Growing core profitability and efficiency. Stable cost of risk. Positive net profit in 4Q22 of PLN249mn. Positive net profit in 4Q22 Adjusted net profit* NII** and NIM strongly up PLN249mn +99% y/y +72%; +173bp y/y Adj. ROE Adj. cost/income Cost of risk 21.5%
Slide 28: Business Highlights of 2022
BUSINESS HIGHLIGHTS OF 2022 Good dynamics of deposits and customer acquisition despite deceleration in lending. RWA management in focus. Customer deposits PLN loans PLN mortgage loans +7% y/y +1% y/y +4% y/y Debit cards Active retail customers Companies’ Active digitalportfolio customers +206k y/y 2
Slide 29: The Most Important Awards and Achievements in 4Q22
THE MOST IMPORTANT AWARDS AND ACHIEVEMENTS OF BANK MILLENNIUM in 4Q22 Fantastic people, great digital banking and remote service quality confirmed by independent rankings and competitions Bank Millennium with the title of Reliable Beata Krupińska – Marketing Director of the Bank Millennium is the be
Slide 30: ESG Activities
ESG ACTIVITIES Two New Head Offices of Bank Millennium in Gdańsk in the spirit of sustainable development Substantive Partners: • Patent Office of the Republic of Poland • University of Science and Technology in Cracow • Warsaw School of Economics • 10.2022 premiere of the Report "Eco-index Millenni
Slide 31: Investor Relations - Contact
RELACJE Z INWESTORAMI - KONTAKT Kierujący Departmentem Relacji z Inwestorami Katarzyna Stawinoga Tel: +48 22 598 1110 Dariusz Górski e-mail: katarzyna.stawinoga@bankmillennium.pl Tel: +48 514 509 925, +48 22 598 1115 e-mail: dariusz.gorski@bankmillennium.pl Marek Miśków Tel: +48 22 598 1116 e-mail: