Banco Santander, S.a. · BME:SAN
Banco Santander — Investor Presentation (October 2017)
24 slides from Banco Santander's investor presentation, Oct 10, 2017
Slide 1: Helping people and businesses prosper
Helping people and businesses prosper Hector Grisi Country Head Mexico
Slide 2: Forward-looking statements disclaimer
1 Banco Santander, S . A . ("Santander") cautions that this presentation contains statements that constitute “forward - looking statements” within the meaning of the U . S . Private Securities Litigation Reform Act of 1995 . Forward - looking statements may be identified by words such as “expect”, “
Slide 3: Contents
2 Contents Key takeaways 4 Mexican market and outlook 1 Delivering on our strategic targets ahead of plan 2 Positioned to capture further growth opportunities 3
Slide 4: Mexican market and outlook
3 Mexican market and outlook 1
Slide 5: The Mexican economy has shown remarkable resilience
4 1/4/2016 1/4/2017 2016 2017E 2018E 2019E 3.4 6.0 3.9 3.6 The mexican economy has shown remarkable resilience… Stable economic growth Hike in interest rates to control inflation FX back to stable levels Private consumption and exports main growth drivers Low fiscal and external imbalances Normalise
Slide 6: Attractive fundamentals for the financial industry
5 Positive demographic and socio - economic evolution • Young population : +15MM more working age individuals 2030E • Growing middle - class and formal employment Sound banking system • Double digit growth in credit and deposits • Healthy asset quality, strong capitalisation and liquidity • Stable r
Slide 7: Delivering on strategic targets ahead of plan
6 Delivering on strategic targets ahead of plan 2
Slide 8: We aim to be market leader in profitability and growth
7 • Become a customer centric bank • Be the market leader in profitability and growth Strategic priorities Enablers Leverage leading position in key segments… • SME & Middle markets • Mortgages • Global Corporate Banking …to increase our business with individuals • Become customers primary bank • Co
Slide 9: Clear objectives supported by a well-defined strategy
8 …with clear objectives supported by a well - defined strategy One of the top companies to work for Attractive employer for new generations Cultural transformation: Simple | Personal | Fair Digital transformation to improve customers’ experience Payroll customers growth Increasing loyalty through d
Slide 10: Improving substantially the quality of our customer base
9 2015 1H'16 2016 1H'17 1,390 1,482 1,608 1,829 1H'16 1H'17 682 1,434 2015 1H'16 2016 1H'17 876 1,045 1,282 1,694 Improving substantially the quality of our customer base Loyal customers (k) +23% Digital customer (k) New customers (net) (k) +110% +62% 2015 1H'16 2016 1H'17 475 627 929 1,174 Mobile c
Slide 11: Delivering shareholder value
10 13.2% 15.5% 19.6% RoTE C/I ratio NPL ratio CET1 ratio 3.4% 2.8% 2.6% 12.1% 10.3% 11.4% 1H‘17 2016 2015 (1) Local GAAP 41.3% 39.8% 39.1% Delivering shareholder value… 1
Slide 12: Strong financial results focused on profitability improvement
11 Note: Constant euros …due to strong financial results focused on profitability improvement 1H'16 1H'17 3.0% 2.6% Enhancing efficiency Asset quality improvement 1H'16 1H'17 40.5% 39.1% 1H'16 1H'17 Increasing NIM Higher profitability 1H'16 1H'17 3.7% 3.9% 13.6% 19.6% Business volume growth 1H'16 1H
Slide 13: Engaged team delivering the execution of strategic projects
12 Engaged team delivering the execution of strategic projects • More than 2.9k scholarships • Sustainability index of the Mexican Stock Exchange • >25k children benefited by the Trust for the Children of Mexico in 2016 • Recognised as the most socially responsible bank in Mexico for 2 nd straight y
Slide 14: Positioned to capture further growth opportunities
13 Positioned to capture further growth opportunities 3
Slide 15: Our strength in key segments and footprint enable us to close gaps
14 Our strength in key segments and footprint enable us to close gaps Market share as of Jun'17 Strengths Opportunities 26% SME loans 2 nd 18% Middle market 2 nd 19% Mortgages 2 nd 16% Credit Cards 3 rd 1% Auto loans 7 th 13% Payroll loans 4 th 12% Payroll deposits 4 th 30% Individual deposits mix v
Slide 16: Aiming to be Mexico's best Corporate Banking franchise
15 (1) Euromoney 2017 x Global coverage x Relationship - driven strategy x Teams led by senior bankers, product specialists and risk analysts x Combining local knowledge with the global expertise Lending & cash management • Strong share - of - wallet • Risk - free business Markets • #1 ETDs • #2 Fix
Slide 17: Tailored offering for Middle-Market and SME
16 Tailored offering for Middle - Market and SME with a customer centric model 2015 1H'17 Middle - Market SME PBT Contribution 75% of total payrolls attracted… …with 1/3 loyal customers +2 new zones +13 new teams 2015 1H'17 PBT Contribution Loan growth (Jun’15 - ’17 CAGR) 12% 127k Digital customers
Slide 18: Attracting new customers and increasing loyalty in retail
17 Santander Plus Loyalty program based on payroll to attract customers and promote transactions • Strong reduction in attrition ( +110% net new customers) +2MM customers Co - branded credit card with Mexico’s leading airline carrier • 35% new customers • Increased share - of - wallet with customers
Slide 19: Broadening our scope with new high-potential businesses
18 • Comprehensive offer to low income individuals • Leverage technology to improve operating model • High social impact (benefiting >350k families over the next 5 years) • New customised product offering to SME, middle market and corporate customers • Strong fee generating business • Leverage on ex
Slide 20: Transforming deeply to become our customers' first bank
19 T ransforming deeply to become our customers’ 1 st bank Customer experience Distribution model Digital Data & analytics IT & operations Talent & culture • Micro markets strategy • New commercial model • New branch concept & layout • New organisational design • Strategy for new digital talent • In
Slide 21: Key takeaways
20 Key takeaways 4
Slide 22: We are delivering ahead of plan and with an improved RoTE
21 1.7 2018 1H’17 2016 Customers Fee income YoY Loans YoY Customer satisfaction Total loyal customers (MM) Digital customers (MM) 4% 19% Top 3 1.4 0.9 4% 8% Top 3 1.6 1.3 7% 2% Top 3 1.8 1.7 10% DD Top 3 1.8 Communities Number of scholarships 2016 - 2018 (k) BMV Sustainability Index 3.5 4.0 2.9 17.6
Slide 23: Key takeaways
22 • Santander Mexico is delivering its commitments ahead of plan as it is already taking advantage of its potential to become the market leader in profitability and growth… …by leveraging our strong position in SME, middle market and corporates to attract new individual customers and become their p
Slide 24: Thank you
23 Thank you Our purpose is to help people and businesses prosper. Our culture is based on the belief that everything we do should be SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigne
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