Dexia Holding SA · EURONEXT:DEXB
Dexia Holding SA — Q3 2005 Earnings Presentation
42 slides from Dexia Holding SA's earnings presentation, Nov 17, 2005
Slide 1: Activity and Financial Results in Q3, 2005
Activity and Financial Results in Q3, 2005 Brussels, November 17, 2005 Rembert von Lowis Group CFO
Slide 2: Changes in accounting referential, scope of consolidation, segmentation and conventions
Changes in accounting referential, scope of consolidation, segmentation and conventions Pro forma accounts 9 Scope (M€) Reported net income – Group share September 30, 2004 1,396 - Exits (Kempen & Co, SMBP) -2 + Additions (FMS Hoche) ≅0 Pro forma net income – Group share September 30, 2004 1,394 Δ -
Slide 3: Summary of 9M 2005 P&L account
Summary of 9M 2005 P&L account NINE MONTHS 2005 Evolution of U Evolution of underlying (M€) 9M 2004* 9M 2005** 9M 05 / underlying *** 9M 04 *** at constant rate of exchange Income 4,185 4,406 + 5.3 % + 5.3 % + 5.6 % of which net commissions 778 868 + 11.5 % Costs - 2,265 - 2,387 + 5.4 % + 5.4 % +
Slide 4: Key performance indicators
Key performance indicators 9M 2004 9M 2005 C/I ratio 54.1 % 54.2 % C/I ratio underlying 55.4 % 55.5 % ROE 17.5 % 19.3 % EPS (€) 1.24 1.36 RORWA 1.78 % 1.89 % Profit margin 34.6 % 34.7 % Variation in 30/06/05 30/09/05 3 months Tier 1 ratio 9.4 % 9.9 % RWA (Bn€) 114.5 111.8 - 2.3 % NAV per share (€) C
Slide 5: Cost of risk
Cost of risk related to total net O/S commitments** (in basis points) 2.5 1.2 1.2 Credit 0.4 0.7 0.6 0.6 0.6 0.8 enhancement 12.2 * 9.8 * 7.8 6.4 6.6 5.7 * Banking 2.2 1.8 * activities 1.1 * 1997 1998 1999 2000 2001 2002 2003 2004 9M 2005 annualized * Excluding impact of charges for Legio Lease at D
Slide 6: Summary of Q3 2005 P&L account
Summary of Q3 2005 P&L account THIRD QUARTER 2005 Evolution of U Evolution of underlying (M€) Q3 2004* Q3 2005** Q3 05 / underlying *** Q3 04 *** at constant rate of exchange Income 1,319 1,510 + 14.5% + 9.1% + 10.0% of which net commissions 234 285 + 22.0% Costs - 766 - 821 + 7.3% + 5.8% + 6.3% G
Slide 7: Quarterly evolution
Quarterly evolution of the underlying gross operating income (M€) 1,435 1,415 1,430 1,363 1,389 1,353 1,311 Income Costs 784 792 810 758 765 773 730 633 632 662 623 620 546 569 Gross operating income Q1 2004* Q2 2004* Q3 2004* Q4 2004* Q1 2005** Q2 2005** Q3 2005** * Without IAS 32, IAS 39 and IFRS
Slide 8: Business lines
Business lines Activity and Results
Slide 9: Strong top line performances and originations in the three commercial business lines
Strong top line performances and originations in the three commercial business lines Underlying revenues growth Business volumes growth (in 12 months) (M€) + 12.0 %* PUBLIC FINANCE 1,663 1,497 • LT commitments + 18.9 % • Net par o/s FSA + 4.8 % 9M 04 9M 05 (M€) + 4.1 % PERSONAL FINANCIAL 1,611 1,676
Slide 10: Public/Project Finance & Credit Enhancement
Activity highlights Public/Project Finance & Credit Enhancement LT originations LT banking commitments (excl. Germany) (incl. Germany) (Bn€) + 59 % + 19 % 221.2 33.8 + 44 % at constant 186.1 scope 9.4 168.6 3.2 New 20.5 21.2 business Change of 28.0 scope 203.5 169.9 153.2 16.4 16.8 4.8 5.8 3.7 15.4
Slide 11: Public/Project Finance & Credit Enhancement
Activity highlights Public/Project Finance & Credit Enhancement 9 Long-term banking commitments* (Bn€) + 18.9 % 221.2 186.1 17.7 39.6 America Project/ 16.2 27.7 Corporate Finance 97.1 78.7 Other countries 203.5 169.9 Public Finance France + Belgium 79.7 84.5 + Luxembourg 30/09/2004 30/09/2005 * full
Slide 12: Public/Project Finance & Credit Enhancement
Activity highlights Public/Project Finance & Credit Enhancement Credit enhancement (FSA) Gross present value originations Net par outstanding (M US$) (Bn US$) + 1.5 % + 4.8 % 692 710 721 31 53 72 49 52 54 336 352 105 97 79 7 13 290 40 33 3 10 138 171 37 7 185 6 87 100 84 369 323 345 209 160 182 9M 2
Slide 13: Public/Project Finance & Credit Enhancement
Public/Project Finance & Credit Enhancement Analysis of 9M 2005 underlying P&L NINE MONTHS 2005 Δ Δ at constant (M€) 9M 2004* 9M 2005** 9M 05 / rate of 9M 04 exchange Income 1,497 1,663 + 11.1 % + 12.0 % Costs - 509 - 555 + 9.0 % + 9.6 % Gross operating income 988 1,108 + 12.1 % + 13.2 % Cost of ris
Slide 14: Public/Project Finance & Credit Enhancement
Public/Project Finance & Credit Enhancement Analysis of Q3 2005 underlying P&L THIRD QUARTER 2005 Δ Δ at constant (M€) Q3 2004* Q3 2005** Q3 05 / rate of Q3 04 exchange Income 499 571 + 14.4 % + 17.2 % Costs - 175 - 188 + 7.4 % + 9.3 % Gross operating income 323 382 + 18.2 % + 21.6 % Cost of risk -1
Slide 15: Public/Project Finance & Credit Enhancement
Public/Project Finance & Credit Enhancement Quarterly evolution of the underlying gross operating income (M€) 571 540 541 551 499 500 499 Income 382 362 361 365 335 330 323 Gross operating income Costs 178 180 186 188 163 170 175 Q1 2004* Q2 2004* Q3 2004* Q4 2004* Q1 2005** Q2 2005** Q3 2005** * Wi
Slide 16: Personal Financial Services: Total Customer Assets
Activity Highlights Personal Financial Services 9 Total Customer Assets (Retail and Private Banking) (Bn€) + 8.4 % 124.9 of which 115.1 116.7 8.9 7.5 8.0 Insurance 41.4 (Life insurance technical Private reserves) Banking 51.4 53.0 61.0 Off Balance Sheet products (Mutual funds, direct securities,...)
Slide 17: Personal Financial Services: Total Customer Loans
Activity Highlights Personal Financial Services 9 Total Customer Loans (Retail and Private Banking) (Bn€) + 8.6 % 28.2 26.0 26.4 2.7 Loans to Private banking 2.5 2.5 customers 6.2 6.0 Loans to SME, independents 6.0 2.3 2.4 Consumer loans 2.3 Mortgage loans 15.5 17.0 15.2 Sept. 2004 Dec. 2004 Sept. 2
Slide 18: Personal Financial Services
Personal Financial Services Analysis of 9M 2005 underlying P&L NINE MONTHS 2005 Δ (M€) 9M 2004* 9M 2005** 9M 05 / 9M 04 Income 1,611 1,676 + 4.1 % Costs - 1,182 - 1,195 + 1.2 % Gross operating income 429 481 + 12.1 % Cost of risk - 23 - 16 - 28.3 % Tax expense - 126 - 146 + 15.1 % Other items +3 0 n
Slide 19: Personal Financial Services
Personal Financial Services Analysis of Q3 2005 underlying P&L THIRD QUARTER 2005 Δ (M€) Q3 2004* Q3 2005** Q3 05 / Q3 04 Income 545 572 + 5.0 % Costs - 394 - 406 + 3.1 % Gross operating income 152 167 + 9.9 % Cost of risk -8 -2 Tax expense - 44 - 53 Other items +2 +1 Net income – Group share 102 11
Slide 20: Personal Financial Services
Personal Financial Services Quarterly evolution of the underlying gross operating income (M€) 572 545 547 557 531 534 540 Income 572 547 557 531 530 528 530 406 394 393 397 406 382 386 Costs : without upfront fees on structured products Gross 154 154 160 167 149 152 operating 129 income Q1 2004* Q2
Slide 21: Investment Management and Insurance Services: Assets under Management
Activity Highlights Investment Management and Insurance Services 9 Assets under Management* (Bn€) Organic growth: YTD + 18.9 % Market effect: YTD + 11.1 % + 30.0 % 2.3 87.9 4.2 2.3 81.4 3.4 Market 1.2 75.7 Organic 3.0 effect 1.7 71.5 Market growth 67.6 2.1 Market Organic Organic effect effect growth
Slide 22: Investment Management and Insurance Services: Fund Administration
Activity Highlights Investment Management and Insurance Services 9 Fund Administration Capital managed at end # of NAV to calculate # of transactions of period (Bn€) in the year (x 1000)** (in million) 402 2.15 412 2.05 348 1.97 338 1.83 397 1.76 163 381 157 160 Other* 240 Mandates to 181 189 DFS Se
Slide 23: Investment Management and Insurance Services: Insurance premiums
Activity Highlights Investment Management and Insurance Services 9 Insurance premiums (M€) 971 91 841 845 of which 113 105 686 700 PPF Non life 101 18 % 95 880 PFS 728 740 70 % 591 599 Life IMIS 12 % Q3 2004 Q4 2004 Q1 2005 Q2 2005 Q3 2005 23
Slide 24: Investment Management and Insurance Services
Investment Management and Insurance Services Analysis of 9M 2005 underlying P&L NINE MONTHS 2005 Δ Δ at constant (M€) 9M 2004* 9M 2005** 9M 05 / rate of 9M 04 exchange Income 460 493 + 7.2 % + 7.4 % Costs - 277 - 309 + 11.3 % + 11.3 % Gross operating income 183 184 + 0.9 % + 1.4 % Cost of risk -1 0
Slide 25: Investment Management and Insurance Services
Investment Management and Insurance Services Analysis of Q3 2005 underlying P&L THIRD QUARTER 2005 Δ Δ at constant (M€) Q3 2004* Q3 2005** Q3 05 / rate of Q3 04 exchange Income 143 154 + 7.3 % + 8.0 % Costs - 97 - 109 + 12.5 % + 12.5 % Gross operating income 46 45 - 3.5 % - 1.4 % Cost of risk 0 0 n.
Slide 26: Investment Management and Insurance Services
Investment Management and Insurance Services Quarterly evolution of the underlying gross operating income (M€) 173 171 172 168 154 144 143 Income 109 102 98 101 97 88 92 Costs 81 69 69 70 56 46 45 Gross operating income Q1 2004* Q2 2004* Q3 2004* Q4 2004* Q1 2005** Q2 2005** Q3 2005** * Without IAS
Slide 27: Quarterly evolution
IMIS Quarterly evolution of the underlying gross operating income (M€) Asset Management Fund Administration 62 71 73 65 62 64 61 60 50 45 44 46 42 47 49 43 44 44 44 35 40 29 22 25 27 21 22 24 34 25 20 28 21 19 20 21 22 24 17 20 13 16 Q1 2004* Q2 2004* Q3 2004* Q4 2004* Q1 2005** Q2 2005** Q3 2005**
Slide 28: Insurance Activities at Group level
Insurance Activities* at Group level: Contribution of the business lines to the revenues (Underlying in M€) 9M 9M2005 2005revenues: revenues: 309 309M€ M€ + +5.4 5.4% %over over9M 9M2004 2004 Public/Project Finance 5% 48 % Personal Financial Services 47 % Investment Management and Insurance Services
Slide 29: Treasury and Financial Markets
Treasury and Financial Markets Analysis of 9M 2005 underlying P&L NINE MONTHS 2005 Δ Δ at constant (M€) 9M 2004* 9M 2005** 9M 05 / rate of 9M 04 exchange Income 343 366 + 6.7 % + 7.7 % Costs - 123 - 128 + 3.8 % + 4.2 % Gross operating income 220 238 + 8.2 % + 9.7 % Cost of risk 15 1 n.s. Tax expense
Slide 30: Treasury and Financial Markets
Treasury and Financial Markets Analysis of Q3 2005 underlying P&L THIRD QUARTER 2005 Δ Δ at constant (M€) Q3 2004* Q3 2005** Q3 05 / rate of Q3 04 exchange Income 88 133 +50.5 % +54.7 % Costs - 42 - 43 + 1.1 % + 2.2 % Gross operating income 46 90 + 95.7 % x 2.0 Cost of risk 4 0 n.s. Tax expense -3 -
Slide 31: Treasury and Financial Markets
Treasury and Financial Markets Quarterly evolution of the underlying net income - Group share (M€) 82 74 73 65 53 47 45 Q1 2004* Q2 2004* Q3 2004* Q4 2004* Q1 2005** Q2 2005** Q3 2005** * Without IAS 32, IAS 39 and IFRS 4, based on pro forma accounts ** With IAS 32, IAS 39 and IFRS 4 31
Slide 32: Treasury and Financial Markets
Treasury and Financial Markets Underlying contribution of the business line’s main segments Credit Spread Money Market Other desks Total (M€) portfolio 9M 04* 9M 05** 9M 04* 9M 05** 9M 04* 9M 05** 9M 04* 9M 05** Income 161 178 95 99 87 89 343 366 Costs - 22 - 20 - 30 - 36 - 71 - 72 - 123 - 128 Cost
Slide 33: Central Assets
Central Assets Analysis of underlying P&L (M€) Q3 2004* Q3 2005** 9M 2004* 9M 2005** Income + 36 +1 + 153 + 82 Costs - 57 - 64 - 162 - 189 Gross operating income - 22 - 64 -9 - 107 Tax expense + 10 -6 + 11 + 23 Other items -5 -2 - 17 -8 Net income –Group share - 17 - 72 - 15 - 92 * Without IAS 32, I
Slide 34: Impact of the non-operating items on the P&L
Impact of the non-operating items on the P&L (M€) Q3 2004* Q3 2005** 9M 2004* 9M 2005** Income +9 + 80 + 107 + 126 of which MtM variations of FSA’s CDS portfolio - + 35 - + 21 Costs -1 - 11 0 - 12 Gross operating income +8 + 69 + 107 + 114 Cost of risk +4 + 36 +5 +9 Impairments on (in)tangible asset
Slide 35: Main non-operating items
Main non-operating items (M€) Q3 2004* Q3 2005 Income • Interest discount on “Dexia offer” loans + 11.1 + 7.0 • Gains/losses on equities + 1.0 + 39.7 • MtM of FSA’s CDS portfolio (impact IAS32&39) - + 34.8 Costs • Restructuring cost DBNL -1.4 - • Closure of Rekord in Germany - - 11.2 Cost of risk •
Slide 36: Appendices
Appendices • Update on DBNL/Legio • Update on Artesia integration • Evolution of outstanding shares • Impact of IAS 32/39
Slide 37: Evolution of the share leasing portfolio outstanding
DBNL/Legio Evolution of the share leasing portfolio outstanding 4,178 (M€) 140 3,269 172 2,401 2,448 Total 2,059 Of which Of which Of which 147 1,844 1,776 contracts Dexia Dexia 1,868 180 with Offer Offer 207 capital accepted not 176 1,489 repayments accepted 1,324 1,204 1,136 685 1,637 538 553 1,22
Slide 38: Share Leasing – Evolution of the stock of provisions
DBNL/Legio Share Leasing – Evolution of the stock of provisions (M€) 809 -56 -20 733 Of which: Reversal -36 -25 672 218 con- 288 of DBNL 315 Utilisations Reversal tribution provisions 221 of DBNL from Utilisations provisions 510 Aegon 275 85 -14 -6 Settlement Duisenberg Reversal (400) net of prior o
Slide 39: Downsizing of the branch network in Belgium
Artesia integration Downsizing of the branch network in Belgium Objective Objectivealready alreadyexceeded exceeded Target set in 2001 1,483 -- 27 27 % % 1,083 1,099 940 840 895 543 243 204 2001 2002 2003 2004 Sept. 2005 End 2005 Employee network Independent agents network 39
Slide 40: Impact on personnel
Artesia integration Impact on personnel Objective Objectivealready alreadyexceeded exceeded EFT reduction Achieved to objective 30/09/05 vs EFT headcount at 30/06/01 Head offices - 1,400 - 1,654 Employee network - 870 - 719 - 2,270 - 2,373 40
Slide 41: Evolution of outstanding shares
Evolution of outstanding shares Shares cancelled at Outstanding shares Exercice of General Meeting of 1,145,261,366 warrants May 11, 2005 3,617,864 - 51,886,865 Outstanding shares 1,096,992,365 of which: 12,980,000 bought back in 2005 Treasury shares of which: 11,371,937 10,498,400 31/12/2004 30/09/
Slide 42: Impact of IAS 32/39
Impact of IAS 32/39 on specific items of the income statement Application of IAS 32/39 since Jan. 1st 2005 brings added volatility, among other, to the following items of the P&L Impact on 9 months 05: (M€) Ö Income -5 Of which: CDS FSA + 21 Revenue on structured products - 22 (previously upfron