Unicredit S.p.a. · MIL:UCG

Unicredit — Investor Day (December 2019)

32 slides from Unicredit's investor day presentation, Dec 3, 2019

  1. Slide 1: Capital Markets Day 2019

    Capital Markets Day 2019 J. P. Mustier London, 3 December 2019

  2. Slide 2: One Bank, One UniCredit

     UniCredit Group - Strictly Confidential One Bank, One UniCredit A simple successful Pan European Commercial Bank, with a fully plugged in CIB, delivering a unique Western, Central and Eastern European network to its extensive and growing client franchise UniCredit: a Pan European winner 2

  3. Slide 3: A simple successful Pan European Commercial Bank

     UniCredit Group - Strictly Confidential A simple successful Pan European Commercial Bank Commercial focus Pan European footprint Commercial Banks 19 Revenues, bn >430 Commercial loans, bn International branches and representative offices2 4 21% Italy1 34% Western Europe 11 15% 4 CEE 10% 20% CIB Au

  4. Slide 4: Confirmed track record of execution and delivery of targets

     UniCredit Group - Strictly Confidential Confirmed track record of execution and delivery of targets Transform 2019 showed that: we execute, we are transparent, we do the right thing for all stakeholders and we favour long-term sustainable outcomes over short-term solutions. We are committed to gen

  5. Slide 5: Transform 2019 Targets successfully delivered in worse-than-expected macro environment

    Transform 2019  UniCredit Group - Strictly Confidential Targets successfully delivered in worse-than-expected macro environment 2016-2019 headwinds Decisive actions  Acceleration of Non Core run-off Interest rate impact Acceleration of balance  BTP portfolio reduction sheet de-risking Slowdown of

  6. Slide 6: Transform 2019 Focused execution resulted in key targets being exceeded

    Transform 2019  UniCredit Group - Strictly Confidential Focused execution resulted in key targets being exceeded Strengthened corporate In line with best-in-class EU companies governance -50bn gross NPE reduction since 2015 down to 29bn, reaching by year-end a gross NPE Significant de-risking ratio

  7. Slide 7: Team 23 Plan based on four Pillars

    Team 23  UniCredit Group - Strictly Confidential Plan based on four Pillars Grow and Transform and Disciplined risk Capital and strengthen client maximise management & balance sheet franchise productivity controls management 7

  8. Slide 8: Team 23 Key targets

    Team 23  UniCredit Group - Strictly Confidential Key targets 2018 2019 2020 2023 RoTE1, % 8 >9 8 >8 1bn gross cost savings including: Costs, bn 10.3 10.1 10.2 10.2  c. 8,000 FTE reductions6  c. 500 branch Gross NPE ratio, % 7.7 <5.5 5.0 <3.8 closures6 Tangible equity, EoP bn 47.7 51.62 53 60 CET1

  9. Slide 9: Team 23 Tangible actions to deliver targets

    Team 23  UniCredit Group - Strictly Confidential Tangible actions to deliver targets Grow and Transform and Disciplined risk Capital and strengthen client maximise management & balance sheet franchise productivity controls management Selected examples Customer experience "Go-to" bank for SMEs Enhan

  10. Slide 10: Grow and strengthen client franchise – customer experience

    Grow and strengthen client franchise  – customer experience UniCredit Group - Strictly Confidential Renewed focus on customer satisfaction and service quality Transform 2019 Team 2023 Customer experience as key driver for all strategic initiatives From a strong to a focus on cost efficiency strengt

  11. Slide 11: Grow and strengthen client franchise – SME

    Grow and strengthen client franchise  – SME UniCredit Group - Strictly Confidential "Go-to" bank for SMEs thanks to enhanced service model Key success factors 2023 goals - SME WEU1 CEE Incumbent advantage thanks to long Revenues, bn 1.7 0.6 established presence CAGR 18-23 2 +3% +3% o/w fees 47% 24%

  12. Slide 12: Grow and strengthen client franchise – individuals

    Grow and strengthen client franchise  – individuals UniCredit Group - Strictly Confidential Redesign customer service for individuals thanks to a mix of integrated channels Improved customer service model 2023 goals - individuals WEU1 CEE Distribution model enhancement Revenues, bn 5.7 1.4 Focus on

  13. Slide 13: Grow and strengthen client franchise – growth engines

    Grow and strengthen client franchise  – growth engines UniCredit Group - Strictly Confidential CEE and fully plugged-in CIB as profitable growth engines Key initiatives 2023 goals  Fully exploit CEE leadership position and economic potential, delivering sustainable returns and further improvement

  14. Slide 14: Team 23 Tangible actions to deliver targets

    Team 23  UniCredit Group - Strictly Confidential Tangible actions to deliver targets Grow and Transform and Disciplined risk Capital and strengthen client maximise management & balance sheet franchise productivity controls management Selected examples Paperless bank Process optimisation 14

  15. Slide 15: Transform and maximise productivity – paperless bank

    Transform and maximise productivity  – paperless bank UniCredit Group - Strictly Confidential Dematerialised processes to reduce costs and operational risk Key priorities Main actions 2023 goals Enhancement of customer  Converge to a digital experience in the experience in branches branch  Implem

  16. Slide 16: Transform and maximise productivity – process optimisation

    Transform and maximise productivity  – process optimisation UniCredit Group - Strictly Confidential Continuous process optimisation leading to a new way of working Customer journey1 Main objectives 2023 goals Current accounts Transform and streamline processes to enhance customer experience Investm

  17. Slide 17: Team 23 Tangible actions to deliver targets

    Team 23  UniCredit Group - Strictly Confidential Tangible actions to deliver targets Grow and Transform and Disciplined risk Capital and strengthen client maximise management & balance sheet franchise productivity controls management Credit and financial risk Operational risk and compliance 17

  18. Slide 18: Disciplined risk management – credit and financial risk

    Disciplined risk management &UniCredit controls - credit and financial risk Group - Strictly Confidential Strengthened monitoring and management 2023 targets Disciplined origination targeting best rated clients Automatic risk approval by segments and products with enhanced data analytics during pre

  19. Slide 19: Disciplined risk management – compliance and operational risk

    Disciplined risk management &UniCredit controls – compliance and operational risk Group - Strictly Confidential Targeted actions on Compliance and Operational risk Reinforced governance and steering Rotation of people between business and control functions Anti Financial Crime controls, Improved ov

  20. Slide 20: Team 23 Tangible actions to deliver targets

    Team 23  UniCredit Group - Strictly Confidential Tangible actions to deliver targets Grow and Transform and Disciplined risk Capital and strengthen client maximise management & balance sheet franchise productivity controls management 20

  21. Slide 21: Capital and balance sheet management Decisive actions to increase flexibility

    Capital and balance sheet management  UniCredit Group - Strictly Confidential Decisive actions to increase flexibility Main actions 2023 target  Preference for share buybacks over M&A  Only small bolt-on acquisitions might be considered to accelerate capital allocation Capital allocation  Proact

  22. Slide 22: The way in which results are achieved is as important as the actual results

    Team 23  UniCredit Group - Strictly Confidential The way in which results are achieved is as important as the actual results Grow and Transform and Disciplined risk Capital and strengthen client maximise management & balance sheet franchise productivity controls management 22

  23. Slide 23: Ethics & Respect: Do the right thing!

    Ethics & Respect: Do the right  thing! UniCredit Group - Strictly Confidential Guiding principle for all stakeholder interactions Investors Communities Environment Do the right thing! Colleagues Customers "Do the right thing" to generate sustainable results See annex for details 23

  24. Slide 24: Team 23 Key financials

    Team 23  UniCredit Group - Strictly Confidential Key financials Grow and Transform and Disciplined risk Capital and strengthen client maximise management & balance sheet franchise productivity controls management 24

  25. Slide 25: Team 23 A clear commitment to deliver whatever the environment

    Team 23  UniCredit Group - Strictly Confidential A clear commitment to deliver whatever the environment  Team 23 plan based on pragmatic macro Resilient underlying net profit, assumptions, more adjusted for non-operating items1, the basis for increasing capital distribution conservative than marke

  26. Slide 26: Team 23 – Key targets

    Team 23 – Key targets  UniCredit Group - Strictly Confidential 16bn value creation, 8bn capital distribution and 8bn tangible equity increase1 2018 2019 2020 2023 RoTE2,% 8 >9 8 >8 Costs, bn 10.3 10.1 10.2 10.2 Gross NPE ratio, % 7.7 <5.5 5.0 <3.8 8bn increase1 Tangible equity, EoP bn 47.7 51.63 53

  27. Slide 27: Team 23: a clear commitment to deliver

     UniCredit Group - Strictly Confidential Team 23: a clear commitment to deliver Proven ability to execute as confirmed by Transform 2019 success 16bn value creation, 8bn capital distribution and 8bn tangible equity increase1 "Do the right thing!" 1. Based on Team 23 economic assumptions. 27

  28. Slide 28: Annex

     UniCredit Group - Strictly Confidential Annex ANNEX 28

  29. Slide 29: Notes and methodology

     UniCredit Group - Strictly Confidential Notes and methodology All figures in this presentation are in Euros unless otherwise stated; Figures might not add up due to rounding reasons. Page 3  Revenues refer to Business Divisions, excluding Group Corporate Centre and Non Core  Ranking by corporate

  30. Slide 30: Ethics & respect: do the right thing!

    Ethics & respect: do the right thing! UniCredit Group - Strictly Confidential 2023 targets: a firm commitment to sustainability with tangible initiatives Policy and principles Social impact banking  Endorsement of Task Force on Climate Related Financial Disclosures (TCFD)1 recommendations as clear

  31. Slide 31: Material non-operating items basis for underlying net profit adjustment

     UniCredit Group - Strictly Confidential Material non-operating items basis for underlying net profit adjustment Non-operating items Net P&L CET1, Net P&L CET1, 4Q19 2020 and beyond impact, bn % impact, bn % Unwinding of Yapi joint venture1 -0.4 -0.1 Yapi deconsolidation3 -3.1 +0.7 Integration cost

  32. Slide 32: Disclaimer

     UniCredit Group - Strictly Confidential Disclaimer This Presentation may contain written and oral “forward-looking statements”, which includes all statements that do not relate solely to historical or current facts and which are therefore inherently uncertain. All forward-looking statements rely o

UniCredit — Investor Day (December 2019) on 6ix