Procredit Holding Ag · XETR:PCZ
Procredit — 9M / Q3 2024 Earnings Presentation
49 slides from Procredit's earnings presentation, Nov 14, 2024
Slide 1: 9M / Q3 2024 results
Hubert Spechtenhauser, Chairman of the Management Board Christian Dagrosa, CFO and member of the Management Board 9M / Q3 2024 results Frankfurt am Main, November 2024
Slide 2: Agenda
A. Highlights and business update B. Group results C. Regional performance D. Outlook ProCredit Group | 9M / Q3 2024 results | Frankfurt am Main, 14 November 2024 1
Slide 3: Balance sheet transformation underway
Balance sheet transformation underway 9M delivering on strategic priorities laid out at Capital Markets Day Strong foundation laid in the past two years 9M 2024: significant step on our growth trajectory Strong growth metrics in 9M-24 • Profitable in 2022 despite war in Ukraine, 2023 best year eve
Slide 4: Highlights 9M 2024
Highlights 9M 2024 Strong growth alongside high level of strategic investments Strong business growth in line with strategic priorities for increased scale 9.0% loan growth ► Loans grow by EUR 557m, significant growth momentum across all banks outside Ukraine and Ecuador (9M-23: 1.9%) ► Deposits gro
Slide 5: Strong portfolio growth driven by all customers segments
Strong portfolio growth driven by all customers segments Loan portfolio growth ► Customer loans increase by EUR 557m or 9.0%, underscoring 9.0% YoY goals of updated group strategy for strong and granular growth 9.0% YTD >60% of growth from lower-volume segments (Micro, Small 6,656 6,784 6,226 6,22
Slide 6: Strong deposit development through digital banking channels
Strong deposit development through digital banking channels Deposit growth ► Customer deposits grow by EUR 566m or 7.8% 12.7% YoY Private client deposits grow strongly by more than 10% 7.8% YTD (~60% of total deposit growth), demonstrating good progress of ProCredit’s direct banking strategy 7,549
Slide 7: Strategic positioning on SEE/EE, with positive expected GDP development
Strategic positioning on SEE/EE, with positive expected GDP development and increased international focus on the region GDP outlook for SEE/EE remains intact, well above Euro area Macroeconomic environment / key current themes SEE/EE Euro area • Recent update of GDP growth estimates by IMF with slig
Slide 8: B. Group results
A. Highlights and business update B. Group results C. Regional performance D. Outlook ProCredit Group | 9M / Q3 2024 results | Frankfurt am Main, 14 November 2024 7
Slide 9: Operating income and expense overview
Operating income and expense overview Operating income ► Good increase in operating income yoy by EUR 29.5m or 9.8%, 9.8% 1.4% to EUR 330.7m 330.7 301.2 Continued positive trajectory of net interest income with yoy increase of 11% (in EUR m) 109.4 111.0 Net fee income with slight improvement yoy
Slide 10: Net interest income
Net interest income Quarterly development ► Q3 NII at EUR 90m on level of previous quarters 3.9% 3.8% 3.7% 3.6% 3.5% Volume-driven increases in income from customer loans broadly offset by lower income from cash and cash equivalents due to declined policy rates Interest expenses in Q3 on Q2 leve
Slide 11: Net fee and commission income
Net fee and commission income Quarterly development ► Q3 net fee and commission income of EUR 14.7m On level of previous year Q3 ► YTD net fee and commission income up EUR 0.8m or 1.8% compared to previous year period 14.4 14.3 14.1 15.3 14.7 Income up EUR 5.7m or 8.8%, mainly due to good (in EU
Slide 12: Personnel and administrative expenses
Personnel and administrative expenses Quarterly development ► Q3 personnel and administrative expenses of EUR 76.4m, up 66.3% 68.8% 62.9% EUR 1.8m or 2.4% compared to Q2 61.7% 57.1% 74.6 76.4 70.1 Costs related to strategic investments increasingly levelling 66.1 62.4 37.6 39.3 37.2 33.9 Staff n
Slide 13: Loss allowance
Loss allowance Quarterly development ► Q3 loss allowance with net release of EUR 1.6m Provisions from stage transfers more than offset by partially released management overlays 55 bps 42 bps 2 bps 33 bps -10 bps ► 9M loss allowance of EUR 4.1m, or 8 bps cost of risk Loss allowances for credit ri
Slide 14: Loan portfolio quality
Loan portfolio quality Loan portfolio by geography Net-write offs (annualised) Ecuador Germany 0% Moldova 7% 0.4% 0.5% 0.0% 0.2% 0.2% Bulgaria 3% 19% Georgia 7% Ukraine 7% Stage 2 Albania Serbia 5% 14% 8.8% 9.2% 8.6% 8.1% 8.2% Bosnia & Herzegovina 5% Kosovo Greece 1 13% 6% Romania Macedonia 6% 8% Q3
Slide 15: Regulatory capital, risk-weighted assets, capital ratios
Regulatory capital, risk-weighted assets, capital ratios Capitalisation overview ► CET1 ratio at 14.1%, before recognition of Q3-24 result in EUR m Dec-23 Sep-24 CET1 capital 885 926 Capital ratio well above regulatory capital requirements of Additional Tier 1 capital 0 0 9.3% CET1, 11.5% Tier 1,
Slide 16: C. Regional performance
A. Highlights and business update B. Group results C. Regional performance D. Outlook ProCredit Group | 9M / Q3 2024 results | Frankfurt am Main, 14 November 2024 15
Slide 17: Contribution of regional segments to group net income
Contribution of regional segments to group net income Group functions, e.g. risk management, reporting, capital management, IT, liquidity management, training and development Includes ProCredit Holding, Quipu, ProCredit Academy Fürth, PCB Germany (EUR 40m loan portfolio; EUR 271m deposits) -8.0 32.1
Slide 18: Segment South Eastern Europe
Segment South Eastern Europe Segment key financials SEE Individual bank development (9M-24) Operating income (€m) Cost-income ratio Country Profit after tax (€m) Cost-income Return on ratio equity +17% +2.2pp 224.4 Bulgaria 25.5 46.2% 16.8% 192.6 53.0% 55.3% Kosovo 23.0 48.5% 25.0% Serbia 18.5 53.1%
Slide 19: Segment Eastern Europe
Segment Eastern Europe Segment key financials EE Individual bank development (9M-24) Operating income (€m) Cost-income ratio Country Profit after tax (€m) Cost-income Return on ratio equity +5% +7.9pp Ukraine 19.2 51.0% 37.1% 33.7% 80.9 85.3 43.2% Georgia 8.9 61.2% 11.4% Moldova 4.0 74.1% 10.8% 9M-2
Slide 20: D. Outlook
A. Highlights and business update B. Group results C. Regional performance D. Outlook ProCredit Group | 9M / Q3 2024 results | Frankfurt am Main, 14 November 2024 19
Slide 21: Outlook FY 2024
Outlook FY 2024 Updated on 05 November 2024 FY 2024 outlook (updated) Above 10% ► Growth of the loan portfolio Previous: Around 10% (FX adjusted) Around 10% ► Return on equity (RoE) Previous: 10% – 12% (based on up to 40bps cost of risk) Around 66% ► Cost-income ratio (CIR) Previous: Around 63% (wit
Slide 22: Medium-term financial outlook
Medium-term financial outlook Medium-term outlook ► > €10bn loan portfolio driven by strong growth in number of clients ► Return on equity to reach ~13 – 14%, based on over the cycle risk costs of 30 – 35 basis points ► Cost-income ratio to improve to a level of around 57%, excluding one-off effects
Slide 23: Q&A
Q&A ProCredit Academy, Fürth-Weschnitz, Germany
Slide 24: Appendix A. Impact reporting
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | 9M / Q3 2024 results | Frankfurt am Main, 14 November 2024 23
Slide 25: Strong impact track record over the decades
Strong impact track record over the decades Consistently low net-write offs 5% Network of 4% Opening of the EV CHARGING Establishment of Published OUR RESPONSE 3% ProCredit academies STATIONS installed ProCredit as a ON FORCED LABOUR BANKING GROUP ALLEGATIONS related to 2% and consolidation of GREEN
Slide 26: Impact in ProCredit today
Impact in ProCredit today KPI: Jobs 200k jobs supported by our SMEs Jobs and investment KPI: Investment 64% of our lending goes to Social capital formation impact KPI: Gender Equity Diversity and 20% of our clients are inclusion women owned SMEs Sustainability at ProCredit Green energy KPI: Green Le
Slide 27: 2023 sustainability highlights and developments
2023 sustainability highlights and developments INTERNAL GREEN LENDING CLIENTS JOBS SUPPORTED EMPLOYEES ENVIRONMENTAL THROUGH OUR INDICATORS BUSINESS CLIENTS 61% 9,439 total number of 3,951 business loan clients total number of employees 193,344 electric and hybrid total number of green loans 32,244
Slide 28: Appendix B. P&L and balance sheet
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | 9M / Q3 2024 results | Frankfurt am Main, 14 November 2024 27
Slide 29: 9M 2024 results at a glance
9M 2024 results at a glance In EUR m Q3-23 Q3-24 9M-23 9M-24 Y-o-Y Net interest income 89.0 90.0 244.7 270.6 25.9 Net fee and commission income 14.4 14.7 43.2 44.0 0.8 Other operating income (net) 6.0 6.3 13.2 16.1 2.9 Operating income 109.4 111.0 301.2 330.7 29.5 Income Personnel expenses 31.4 37.1
Slide 30: Overview of quarterly financial development
Overview of quarterly financial development In EUR m Q3-23 Q4-23 Q1-24 Q2-24 Q3-24 Net interest income 89.0 92.6 90.1 90.5 90.0 Net fee and commission income 14.4 14.3 14.1 15.3 14.7 Other operating income (net) 6.0 4.5 3.0 6.8 6.3 Operating income 109.4 111.4 107.2 112.6 111.0 Income Personnel expe
Slide 31: Balance sheet
Balance sheet in EUR m Dec-23 Sep-24 Assets Cash and central bank balances 2,348 2,138 Loans and advances to banks 372 501 Investment securities 751 822 Loans and advances to customers 6,226 6,784 Loss allowance for loans to customers -197 -188 Derivative financial assets 8 7 Property, plant and equ
Slide 32: Balance sheet development
Balance sheet development YTD asset development YTD liabilities and equity development 566 6 10,309 566 60 41 10,309 -101 -8 9,749 9,749 -12 (in EUR m) (in EUR m) Dec-23 Liquid assets Net loans to customers Other Sep-24 Dec-23 Liabilities to Liabilities to Debt securities and Other liabilities Equit
Slide 33: Appendix C. Loan portfolio
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | 9M / Q3 2024 results | Frankfurt am Main, 14 November 2024 32
Slide 34: Structure of the loan portfolio by segment and currency
Structure of the loan portfolio by segment and currency Loan portfolio by segment Loan portfolio by currency 11% 3% 39% 50% 29% 57% 11% Medium Small Micro Private clients EUR USD Other Currencies ProCredit Group | 9M / Q3 2024 results | Frankfurt am Main, 14 November 2024 33
Slide 35: Development of green loan portfolio
Development of green loan portfolio Green loan portfolio growth ► Green loan portfolio amounting to EUR 1.3bn, representing close to 20% of total loan portfolio 15.4% 19.4% CAGR 2018-2023: 13% ► Includes financing of investments in: • Energy efficiency • Renewable energies 1,319 • Other environmenta
Slide 36: Structure of collateral
Structure of collateral Collateral by type (FY 2023) ► Majority of collateral consists of mortgages ► Significant share of financial guarantees mainly as a result of InnovFin and other guarantee programmes provided by the European Investment Fund 1% 16% ► Clear, strict requirements for types of acce
Slide 37: Appendix D. Information on segment and bank level
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | 9M / Q3 2024 results | Frankfurt am Main, 14 November 2024 36
Slide 38: Income statement by segment
Income statement by segment South Eastern 01.01.- 30.09.2024 (in EUR m) Germany Eastern Europe South America Consolidation Group Europe Interest and similar income 47.3 127.5 257.4 40.7 -31.6 441.3 of which inter-segment 19.1 7.0 5.5 0.0 0.0 0.0 Interest and similar expenses 48.0 55.6 70.9 27.7 -31.
Slide 39: Segment South Eastern Europe
Segment South Eastern Europe Regional loan portfolio breakdown Key financial data Albania 6% Bosnia & Herzeg. (in EUR m) 9M-23 9M-24 6% Bulgaria 26% Net interest income 157.9 186.5 Greece1 8% Net fee and commission income 27.6 28.8 Romania 8% Other operating income (net) 7.0 9.2 Operating income 192
Slide 40: Segment Eastern Europe
Segment Eastern Europe Regional loan portfolio breakdown Key financial data Moldova 19% (in EUR m) 9M-23 9M-24 Net interest income 69.6 71.9 Ukraine Net fee and commission income 5.2 4.7 41% Other operating income (net) 6.1 8.8 Operating income 80.9 85.3 Personnel expenses 13.6 15.2 Georgia 40% Admi
Slide 41: Segment South America
Segment South America Regional loan portfolio breakdown Key financial data (in EUR m) 9M-23 9M-24 Net interest income 14.8 13.0 Net fee and commission income 0.1 0.3 Other operating income (net) -0.7 0.3 Ecuador 100% Operating income 14.2 13.6 Personnel expenses 6.0 7.6 Admininistrative expenses 8.7
Slide 42: Key figures per ProCredit bank (as per 9M 2024)
Key figures per ProCredit bank (as per 9M 2024) North Bosnia & Country Bulgaria Serbia Kosovo Romania Macedonia Herzegovina Customer loan portfolio (EUR m) 1,720 934 859 553 420 339 Change in customer loan portfolio (%) 13.4% 2.8% 14.8% 9.0% 9.8% 13.9% Credit impaired loans (Stage 3) 0.9% 3.2% 1.2%
Slide 43: Key figures for ProCredit Bank Ukraine
Key figures for ProCredit Bank Ukraine Development since 2021, before Russian invasion in 2022 Quarterly KPI update (in EUR m) FY-21 FY-22 FY-23 Q2-24 Q3-24 Selected financial indicators Staff information Loan portfolio 757 582 497 Number of staff 347 377 % of group 12.8% 9.5% 8.0% Change qoq % 0.3%
Slide 44: Appendix E. Capital, liquidity and other information
Appendix A. Impact reporting B. P&L and balance sheet C. Loan portfolio D. Information on segment and bank level E. Capital, liquidity and other information ProCredit Group | 9M / Q3 2024 results | Frankfurt am Main, 14 November 2024 43
Slide 45: Successful Tier 2 placement in Apr-24
Successful Tier 2 placement in Apr-24 supporting the group’s medium-term growth ambitions CASE STUDY ProCredit Holding AG successfully placed EUR 125m Green Tier 2 Bonds Summary of transaction: Main statistics: ► On 25-Apr-24, ProCredit Holding successfully placed green ISIN DE000A383C84 Tier 2 subo
Slide 46: Funding, rating and liquidity
Funding, rating and liquidity Funding sources Deposit-to-loan ratio development Rating 1% 3% 1% 11% Customer deposits 117% 115% BBB (stable) ProCredit Holding rating Liabilities to banks by Fitch, last affirmed on Debt securities 15 May 2024 Subordinated debt 84% Other liabilities Dec-23 Sep-24 Tota
Slide 47: 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 The credit-impaired coverage ratio(8) gives insights into loss allowances for manage the implementation and further development of the group’s business credit-impaired l
Slide 48: Contact Investor Relations
Contact Investor Relations Financial calendar (continuously updated on IR Website) Date Location Event information 25.11.2024 Frankfurt/ Main Deutsche Börse, Deutsches Eigenkapitalforum 2024 27.03.2025 Annual Report 2024 12.05.2025 Quarterly Report as of 31 March 2025 04.06.2025 Frankfurt/ Main Annu
Slide 49: Disclaimer
Disclaimer The material in this presentation and further supporting documents have been This presentation and further supporting documents may contain forward- prepared by ProCredit Holding AG, Frankfurt am Main, Federal Republic of looking statements including statements regarding our intent, belie
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