Dexia Holding SA · EURONEXT:DEXB
Dexia Holding SA — Investor Presentation (November 2004)
53 slides from Dexia Holding SA's investor presentation, November 2004
Slide 1: World Leader of Public Finance – General Presentation
World Leader of Public Finance General Presentation November 2004
Slide 2: Contents
Contents ! Dexia within the local public finance market ! Group financial performances and objectives ! Business lines ! Appendices 2
Slide 3: Dexia within the local public finance market
Part One Dexia within the local public finance market
Slide 4: The main markets of local public finance
The main markets of local public finance LT debt O/S: ≈1,350 Bn€ ≈500 Bn€* ≈1,550 Bn€ Bond Bank loans Bond market Access: market & bond market & bank loans 4 * Local authorities only
Slide 5: The players
The local public finance market The players Liability-driven Asset-driven Domestic savings L.T. lending Intermediated banks institutions Dexia Bank Dexia Crédit Local Arrangers Dexia Public Capital Markets Disintermediated (Municipal bond market) Bond Investors insurers Dexia Municipal Agency Dexia
Slide 6: Market constituents – Clients' expectations - Products
Market constituents – Clients’ expectations - Products Market constituents Clients’ expectations ! Municipalities ! Funding ! Regions ! Long-lasting relationship ! Social housing institutions ! Assistance to Financial/budget management ! Health care institutions ! Access to capital markets solutions
Slide 7: Dexia's volume growth outperformed the market's
Dexia’s volume growth outperformed the market’s Europe USA LT loans O/S Muni bonds insured O/S 1,763 Bn$ CAGR: +4.9% p.a. 1,262 Bn$ CAGR: +1.3% p.a. 493 Bn€ 451 Bn€ 1996 1997 1998 1999 2000 2001 2002 1996 1997 1998 1999 2000 2001 2002 Gr oup 201 Bn$ CAGR: +23.2% p.a. CAGR: +8.3% p.a. 129 Bn€ 79 Bn€
Slide 8: Key business model features
Key business model features ! Solvency of borrowers " Low risk asset weighting " Narrow margins " Low cost of risk ! Long-term " Annuity building business " Low revenue volatility ! Importance of funding " High credit ratings needed ! Differential advantages " A “volume” business " Innovation: new p
Slide 9: History: In 1996 CCB and CLF combined into Dexia
History: In 1996 CCB and CLF combined into Dexia Crédit Communal de Belgique (CCB) Crédit local de France (CLF) Lendings to Retail LT lendings local public authorities to local customer public Retail loans authorities deposits LT bond issues (52 Bn€) Bond portfolio (66 Bn€) Bond portfolio assets lia
Slide 10: Dexia primary franchise
Dexia primary franchise … Assets Liabilities High grade bond funding 106 Bn€ Public/Project Finance credit o/S 201 Bn€ Institutional client deposits 45 Bn€ Retail/Private Banking deposits 64 Bn€ Credit Enhancement 290 BnUS$ Asset Management 77 Bn€ (FSA) 10 Aggregate amounts at Dec. 31st, 2003
Slide 11: Business portfolio
Business portfolio Investment Management Services 13% 21% Retail Financial Services Public/Project Finance 50% & Credit Enhancement 16% Treasury and Financial Markets Net income FY 2003: 1,431 M€ Net income 9M 2004: 1,367 M€ 11 Pie chart represents segment contributions to the underlying net income
Slide 12: Financial performances and targets
Part Two Financial performances and targets
Slide 13: A different business model
A different business model Dexia Group of the 29 first European banks 1,000 1,000 Customer loans (1,000 basis) 680 973 Risk-weighted assets B/S 595 961 Customer deposits 60 94 Shareholder Equity 4 23 Non performing loans 1,000 1,000 Revenues (1,000 basis) 539 597 Costs P&L 9 60 Cost of risk 370 238
Slide 14: Profit margin
Profit margin * HVB Group Allianz (Banking Deutsche Bank Abbey National Intesa SP IMI CA SA SocGen RBOS ABN Amro Unicredito Average of 30 ING Groep*** largest** Crédit Suisse European banks UBS Lloyds Average Barclays Fortis *** KBC HSBC Standard Chartered BBVA Santander BNP Paribas HBOS Bank of Ire
Slide 15: Return on risk-weighted assets (RORWA)
Return on risk-weighted assets (RORWA)* 2% 1.89% 1.51% 1.50% 1.39% 1.40% 1.54% 1.30% 1.53% 1.18% 1.32% 1.29% 1.23% 1% 1.12% 1.01% 0% 1998 1999 2000 2001 2002 2003 H1 2004 annualized Dexia Peer group ** * The ratio between the net income (annualized) including minority interests and the average risk-
Slide 16: Cost of risk related to total net O/S commitments
Cost of risk related to total net O/S commitments (in basis points) 2.5 bp Credit 1.2 bp 0.7 bp 1.2 bp 0.4 bp 0.6 bp 0.6 bp 0.5 bp* enhancement 12.2 bp* 9.8 bp* 7.8 bp 6.4 bp 6.6 bp 5.7 bp* Banking 2.2 bp activities 1.5 bp* 1997 1998 1999 2000 2001 2002 2003 9M 2004 annualized * Excluding impact of
Slide 17: Cost/income ratio
Cost/income ratio (%) 59.0 58.9 59.2 Objective 54.8 55.3 53.9 < 54.0 * 1999 2000 2001 2002 2003 9M 2004 2006 17 * Excluding nonrecurring items
Slide 18: ROE and tier 1 ratio
ROE and tier 1 ratio Objective ROE 17.7% 18.7% > 18.0% 16.2% 16.5% 15.7% 14.0% 12.9% 13.2% Tier 1 ratio 11.2% 9.5% 10.2% 9.9% 9.6% 9.0% 9.3% 9.3% 9.3% 9.0% 1996 1997 1998 1999 2000 2001 2002 2003 2006 18
Slide 19: Earnings per share
Earnings per share (€) Objective CAGR: 1.70* CAGR: +11.1 +11.1% %p.a. p.a. CAGR: CAGR: +9.4 +9.4%%p.a. p.a. 1.25 1.24 1.15 1.13 1.22 0.98 0.85 0.95 0.75 0.66 1996 1997 1998 1999 2000 2001 2002 2003 9M 2004 2006 19 * Excluding nonrecurring items
Slide 20: Dividend per share
Dividend per share (€) CAGR: CAGR: +10.5 +10.5%%p.a. p.a. 0.53 0.48 0.48 0.43 0.39 0.36 0.32 0.31 0.26 1997 1998 1999 2000 2001 2002 2003 Dexia France Dexia Belgium Dexia 20
Slide 21: Total shareholder return
Total shareholder return Value in € at 12/11/2004 of 1,000 € invested* on November 20, 1996 on September 19, 1999 (day before creation of Dexia) (day before merger Dexia France and Dexia Belgium) 2,846 2,572 1,957 1,899 1,850 1,287 1,115 1,011 901 841 CAC 40 EuroStox x50 BEL 20 EuroStoxx Dex ia CAC
Slide 22: Summary of P&L
Summary of P&L (M€) 2003 9M 2003 9M 2004 Evolution % Revenues 5,160 3,889 4,055 +4.3% Costs -3,055 -2,253 -2,241 -0.6% Gross operating income 2,104 1,635 1,814 +10.9% Cost of risk -176 -119 -24 -80.1% Corporate income tax -362 -353 -422 +19.5% Other items -135 -60 -1 n.s. Net income 1,431 1,103 1,36
Slide 23: Business lines
Part Three Business lines
Slide 24: Public/Project Finance & Credit Enhancement
Public/Project Finance & Credit Enhancement This segment covers: • Municipal Finance • Project Finance • Corporate Lending • Credit Enhancement 9M 2004 Net underlying* income FY 2003: 790 M€ 50% Net underlying* income 9M 2004: 664 M€ * Excluding nonrecurring items 24
Slide 25: Geographical origin of net income
Geographical origin of net income* Europe America 63% (FSA + NY branch) 35% Dexia NY • Long and short-term • Liquidity facilities financing to the public sector 2% • Project Finance Other • Other financial services to the • Bond portfolio public sector FSA • Credit Enhancement – Muni • Project Finan
Slide 26: Public and Project Finance: evolution of O/S and NIM
Public and Project Finance: evolution of O/S and NIM In & off B/S outstandings* Net interest margin** Bn€ bp 201 170 200 184 24 160 Short-term 167 19 150 15 140 17 13 Other LT 130 140 162 150 133 4 14 152 120 4 11 110 10 136 Public sector 125 100 long-term 119 90 100 80 59 bp 58 bp 70 54 bp 53 bp 53
Slide 27: Growth of outstandings stems from new markets
Growth of outstandings (banking activities) stems from new markets CAGR 2000-2003 (Bn€) +9.3% 184.7 171.8 24.1 +26.5% 154.4 21.1 141.3 17.4 11.9 USA 77.1 69.9 53.4 57.5 +13.0% Other countries France+ 76.0 79.5 80.8 83.6 +3.2% Belgium 2000 2001 2002 2003 27
Slide 28: FSA's credit enhancement: a high growth business
FSA’s credit enhancement: a high growth business Net par outstanding* CAGR 1996-2003 (Bn$) 290 +25.5% International asset- backed obligations 263 38 +67.3% 34 6 +30.0% International municipal obligations 5 217 U.S. asset-backed 25 82 +20.4% obligations 3 92 U.S. Muni obligations 154 13 86 130 2 7 1
Slide 29: Underlying P&L
Public/Project Finance & Credit Enhancement Underlying P&L (M€) 2003 9M 2003 * 9M 2004 Evolution % Revenues 1,867 1,413 1,487 +5.3% Costs -635 -473 -499 +5.6% Gross operating income 1,232 941 988 +5.1% Cost of risk -84 -57 -16 -71.3% Corporate income tax -319 -257 -288 +12.2% Other items -46 -19 -20
Slide 30: Retail Financial Services
Retail Financial Services 9M 2004 Net underlying* income FY 2003: 287 M€ 21% Net underlying* income 9M 2004: 276 M€ * Excluding nonrecurring items 30
Slide 31: Dexia Bank Belgium: a key player in asset gathering
Dexia Bank Belgium: a key player in asset gathering Dexia Bank alone Dexia Bank + Artesia 85 80 82 79 8 7 Bn€ 6 6 19 20 18 18 57 59 2 53 2 49 1 12 13 6 9 56 55 56 57 23 24 43 43 44 45 22 22 7 7 7 7 13 14 9 11 4 5 2 3 16 17 15 15 7 8 9 9 1997 1998 1999 2000 2001 2002 2003 Sept. 2004 Loans to professi
Slide 32: Domestic market shares in Belgium
Domestic market shares in Belgium (at June 2004) Savings bonds Savings accounts Mutual funds Dexia market share: 24.0% 16.5% 16.4% Insurance* Mortgages Consumer loans Dexia market share: 9.2% 15.9% 19.6% * At December 2003 32
Slide 33: Number of branches
Retail Financial Services Number of branches -26% -26% Target 1,483 -18% -18% 1,218 1,099 940 874 895 543 344 204 2001 2002 2003 Sept. 04 2005 Employee network Independent agents network 33
Slide 34: Underlying P&L
Retail Financial Services Underlying P&L (M€) 2003 9M 2003 * 9M 2004 Evolution % Revenues 1,764 1,321 1,441 +9.1% Costs -1,371 -1,025 -1,049 +2.4% Gross operating income 393 296 392 +32.2% Cost of risk -34 -31 -22 -30.0% Corporate income tax -110 -89 -121 +35.8% Other items +37 +24 +27 n.s. Net inco
Slide 35: Investment Management Services
Investment Management Services 9M 2004 13% Net underlying* income FY 2003: 180 M€ Net underlying* income 9M 2004: 174 M€ * Excluding nonrecurring items 35
Slide 36: Investment Management Services
Investment Management Services Gross operating underlying* income 9M 2004 Private Banking Dexia Bank Nederland 67 M€ 36 M€ 16% Other 84% Fund Asset Administration Management 56 M€ 62 M€ Gross operating underlying* income FY 2003: 272 M€ Gross operating underlying* income 9M 2004: 222 M€ * Including
Slide 37: Private and affluent Banking
Private and affluent Banking* Total customer assets** : 28.0 Bn€ By geographical area By type of management Advisory Luxembourg management Discretionary management 41% 69% 18% 9% Belgium 41% 10% 10% Switzerland 2% Other Without France mandate * Excluding Dexia Bank Nederland ** At Sept.30, 2004 37
Slide 38: Dexia Asset Management
Dexia Asset Management Assets by type of management (Bn€) 67.5 * 62.2 60.9 Institutional mandates 17.1 10.6 55.1 53.1 14.9 11.2 3.8 Private clients discretionary 10.6 4.8 43.2 4.0 mandates 4.1 8.6 5.3 Mutual funds (ret & instit.) 31.8 4.4 6.2 4.2 46.6 45.5 43.4 37.2 39.8 30.1 21.5 1998 1999 2000 200
Slide 39: Fund Administration
Fund Administration Total assets under custody (Bn€) 342 297 303 157 Other** 164 182 Mandates* 185 139 115 2002 2003 Sept. 2004 * Excluding Dexia Bank Nederland ** Dexia BIL Group only; excludes other units of Dexia 39
Slide 40: Underlying P&L
Investment Management Services Underlying P&L (M€) 2003 9M 2003 * 9M 2004 Evolution % Revenues 914 592 627 +5.8% Costs -604 -397 -405 +1.9% Gross operating income 310 195 222 +13.9% Cost of risk -22 -13 -2 -84.7% Corporate income tax -80 -51 -45 +12.7% Other items -4 -3 -1 n.s. Net income 204 128 17
Slide 41: Treasury and Financial Markets
Treasury and Financial Markets Net underlying* income FY 2003: 260 M€ 16% 9M 2004 Net underlying* income 9M 2004: 218 M€ * Excluding nonrecurring items 41
Slide 42: Missions and key figures
Treasury and Financial Markets Missions and key figures ! Missions ! Long and short-term funding ! Liquidity ! Financial markets desks (Forex, derivatives, equities, bonds…) ! In 2003 ! L.T. debt issued in 2003: 22 Bn€ ! CSP outstanding: 39 Bn€ ! S.T. debt outstanding 2003: 39 Bn€ Credit Spread Port
Slide 43: Underlying P&L
Treasury and Financial Markets Underlying P&L (M€) 2003 9M 2003 * 9M 2004 Evolution % Revenues 472 407 400 -1.7% Costs -153 -152 -134 -12.2% Gross operating income 319 255 267 +4.6% Cost of risk 6 +7 +15 x 2.1 Corporate income tax -60 -58 -62 +6.6% Other items -2 -2 -2 n.s. Net income 263 202 218 +7
Slide 44: Appendices
Appendices
Slide 45: Dexia ranking in Euroland (market capitalisation)
Dexia ranking in Euroland (market capitalisation) 31/12/2000 31/12/2001 31/12/2002 12/11/2004 1 ALLIANZ DRESDNER 1 ALLIANZ DRESDNER 1 BNP Paribas 1 BNP Paribas 2 ING Groep 2 ING Groep 2 ING Groep 2 ING Groep 3 DEUTSCHE BANK R 3 DEUTSCHE BANK R 3 SANTANDER 3 BCO SANTANDER Central Hispano 4 SANTANDER
Slide 46: Cost synergy achievements
Artesia integration Cost synergy achievements ⇒ 102 M€ linked to staff costs ⇒ 60 M€ linked to other operating expenses 200 (M€) 162 180 149 107 101 95 85 55 60 39 50 48 55 25 30 16 Objective Achieved Objective Achieved Objective Achieved Objective Min. Max. Min. Max. Min. Max. 9M 2004 Min. Max. 200
Slide 47: Credit ratings of main subsidiaries
Credit ratings of main subsidiaries S&P Moody’s Fitch Dexia Crédit Local AA Aa2 AA+ Dexia Bank Belgium AA Aa2 AA+ Dexia BIL AA Aa2 AA+ Dexia Municipal Agency AAA Aaa AAA FSA AAA Aaa AAA 47
Slide 48: Main stock indexes including the Dexia stock
Main stock indexes including the Dexia stock # Euronext 100 # CAC 40 # BEL 20 # Dow-Jones Stoxx & EuroStoxx # FTSE Eurotop 100 # FTSEurofirst80 # MSCI # Next CAC 70 (31/01/2005) # Dexia is also included in 4 “Sustainable Growth” indexes: # DJ Sustainability Index “World”, # ASPI Eurozone, # FTSE 4 G
Slide 49: Shareholders' base
Shareholders’ base Total number of shares outstanding: 1,136,191,653* Arcofin 15.8% Holding Communal Groupe CDC (incl. CNP) 47.6% 15.7% Ethias Staff and Management 8.0% Treasury Shares 6.2% Others 2.5% 4.2% * At Sept. 30, 2004 49
Slide 50: Forthcoming infrastructure needs (1)
Forthcoming infrastructure needs (1) Estimation of the World Bank: Total infrastructure needs in developing countries 2005-2010 465 Bn$ /year 50
Slide 51: Forthcoming infrastructure needs (2)
Forthcoming infrastructure needs (2) Estimation of Camdessus Panel Report: Water and waste water needs in developing countries until 2025 180 Bn$ /year 51
Slide 52: Forthcoming infrastructure needs (3)
Forthcoming infrastructure needs (3) EU estimates: Total investment needs to meet EU standards in the 10 accessing countries by 2015 Transport infrastructure : 92 Bn€ Environment : 108 Bn€ 52
Slide 53: Contacts
Contacts Robert Boublil Director of Investor Relations Investor Relations Officers: Peter de Baere (Brussels) Anne Garsoux (Brussels) Thomas Guittet (Paris) Tel: +32 2 213 57 46 Tel: +32 2 213 57 49 Tel: +33 1 43 92 80 34 Fax: +32 2 213 57 80 Fax: +32 2 213 57 80 Fax: +33 1 43 92 71 07 peter.debaere