Intercorp Financial Services Inc. · NYSE:IFS
Intercorp Financial Services — Q1 2024 Earnings Presentation
53 slides from Intercorp Financial Services's earnings presentation, May 14, 2024
Slide 1: Earnings Presentation 1Q24 results
Earnings Presentation 1Q24 results
Slide 2: Sustainable growth, digital platform, key businesses, takeaways
1 2 Sustainable Building a growth digital platform 3 Key businesses 4 Takeaways
Slide 3: Economy starts to show signs of recovery
Economy starts to show signs of recovery Quarterly GDP growth YoY (%) Interest rates (%) 2.1% Soles reference rate (BCRP) Dollar reference rate (FED) 2024(E) 7.75 7.75 May24 7.50 3.0% 5.75% 6.75 6.00 -0.4% -0.3% -0.5% -1.0% 5.50 5.50 5.50 5.25 4.75 (1) 1Q23 2Q23 3Q23 4Q23 1Q24 Mar23 Jun23 Sep23 Dec2
Slide 4: Moderate improvement in leading indicators
Moderate improvement in leading indicators Consumer confidence index & Business trust (%) FY24 Private investment estimate Consumer confidence index Business trust 2.3% 1.8% 59 Mar23 Mar24 55 52 51 52 FY24 Public investment estimate 44 39 39 39 35 4.0% 4.0% Mar23 Jun23 Sep23 Dec23 Mar24 Mar23 Mar24
Slide 5: Digital financial platform with strategic focus on key businesses and profitability
Digital financial platform with strategic focus on key businesses and profitability Growth Digital Focus Leading digital platform Creating the best Core businesses with profitable growth digital experience 15.1% 21.8% +12% +14% 77% Digital banking MS retail deposits MS consumer banking loans YoY ins
Slide 6: Sustainable growth
1 2 Sustainable Building a growth digital platform 3 Key businesses 4 Takeaways
Slide 7: Key messages
Key messages 1 2 3 Banking results partially Marginal improvement Tight management of compensate extraordinary of CoR translates into costs reflected in solid impacts on insurance better results for IBK efficiency levels S/ 141mn (1) -55bps +30bps +2% 37.3% Net profit IFS QoQ CoR QoQ ROE IBK YoY Exp
Slide 8: IFS' 1Q24 earnings impacted by investment results and still high CoR
IFS’ 1Q24 earnings impacted by investment results and still high CoR IFS net profit (S/ mn) ROE 11.5% 11.6% 5.6% ROE 13.6% 6.8% 7.1% 37.6% 138.9% n.m. 137 Includes Banking(2) Insurance non-recurring 250 ~S/-100 mn(1) 135 140 31 (20) 1Q23 4Q23 1Q24 286 1Q23 4Q23 1Q24 267 Includes non-recurring +4% Qo
Slide 9: +2% YoY growth in revenues at IFS
+2% YoY growth in revenues at IFS IFS quarterly revenues (S/ mn) NIM 5.1% 5.2% 5.2% NIM 5.1% 5.5% 5.3% 1,193 1,258 1,209 418 392 Insurance 384 Banking 1,817 (1) 1,733 1,692 1Q23 4Q23 1Q24 1Q23 4Q23 1Q24 -4% QoQ | +1% YoY -8% QoQ | -2% YoY 108 94 management 70 (1) 90 67 Payments Wealth 47 1Q23 4Q23 1
Slide 10: CoR at 4.7% in 1Q24, good performance of new harvests and strong coverage
CoR at 4.7% in 1Q24, good performance of new harvests and strong coverage Banking Retail Commercial Credit cards & 21% personal loans 8.3% 7.9% Payroll deduction 5.4% 45% loans 3.2% 5.2% 12% Mortgages 4.7% 0.6% 0.6% Commercial 1.4% 22% 1Q23 4Q23 1Q24 Cost of risk (%) Banking – Performing loans break
Slide 11: We continue to monitor payment behavior on consumer loans
We continue to monitor payment behavior on consumer loans Non-rescheduled Rescheduled (2) Payment of non-rescheduled loans (S/ mn) 11,100 11,129 10,660 10,076 Collected Not paid 14% 18% 20% 20% 98.0% 98.1% 2.0% 1.9% Dec23 Mar24 Dec23 Mar24 (2) Payment of rescheduled loans 86% 82% 80% 80% Collected N
Slide 12: Tight management of costs with only 2% YoY growth
Tight management of costs with only 2% YoY growth IFS expenses (S/ mn) Banking expenses (S/ mn) C/I 37.1% 36.2% 37.3% C/I 39.1% 36.2% 38.7% 680 691 690 487 475 488 1Q23 4Q23 1Q24 1Q23 4Q23 1Q24 0% QoQ | +2% YoY +3% QoQ | 0% YoY 12
Slide 13: Building a digital platform
1 2 Sustainable Building a growth digital platform 3 Key businesses 4 Takeaways
Slide 14: Scalable digital proposition
Scalable digital proposition IzipayYa Izipay Digital bank Investments Insurance Cuenta Sueldo Marketplace Loyalty & promotions Digital My financing finances Piggy Payments bank 2.6 mn 1.4 mn IBK app users Izipay - merchants 100% digital account
Slide 15: Consolidating digital achievements in banking
Consolidating digital achievements in banking 60% 63% 76% 69% Mar23 Mar24 Mar23 Mar24 Digital sales - Retail Digital self-service (% of digital self-service) (1) (% of products sold digitally) 72% 77% 60 61 Dec23 Mar-24 Mar23 Mar24 Digital customers - Retail NPS Retail (1) (Points – Retail Banking)
Slide 16: Working towards digital innovation in insurance & wealth management
Working towards digital innovation in insurance & wealth management 63% 13% 82% 12% 75% Insurance 50% 1Q23 1Q24 1Q23 1Q24 1Q23 1Q24 SOAT digital sales Digital premiums – Vida cash Digital self-service (% of products sold digitally) (% of total premiums Vida cash) (% of digital self-service) 41% 45%
Slide 17: Key businesses
1 2 Sustainable Building a growth digital platform 3 Key businesses 4 Takeaways
Slide 18: Double digit growth in lower-risk products & segments
Double digit growth in lower-risk products & Banking segments Includes Impulso MyPeru 673 437 438 307 597 613 398 233 ~60% 197 1Q23 4Q23 1Q24 1Q23 4Q23 1Q24 1Q23 4Q23 1Q24 Payroll deductible loans disbursements (S/ mn) Mortgage disbursements (S/ mn) SME disbursements (S/ mn) +13% YoY | +10% QoQ +10%
Slide 19: Strong market relevance in key products
Banking Strong market relevance in key products 22.3 21.9 19.2 18.9 13.7 14.6 Mar23 Mar24 Mar23 Mar24 Mar23 Mar24 MS Consumer banking loans (%) MS Retail banking loans (%) MS Payroll inflow (%) 14.9 15.1 9.7 16.9 9.2 11.0 Mar23 Mar24 Mar23 Mar24 Mar23 Mar24 MS Retail banking deposits (%) MS Commerci
Slide 20: Loan book boosted by Impulso MyPeru
Loan book boosted by Impulso MyPeru: Banking Almost S/ 1 billion disbursed by Interbank SME 36% Mid- sized 15 auctions 50%-98% 64% +S/ 8,200 mm guarantee levels Impulso MyPeru disbursements (S/ mn) Average BCP Grace period 22% auction rate 6 months Others 42% < 13% BBVA 19% Interbank 17% Market shar
Slide 21: Evolving loan mix impacting NIM
Banking Evolving loan mix impacting NIM % of Unsecured 24% 22% 21% loans (2) Retail loans Commercial loans NIM Risk-adjusted NIM Financial investments Cash and banks Yield on loans Return on interest-earning assets 68,572 65,554 66,092 18% 14% 15% 11.5% 11.6% 10.9% 11.3% 10.8% 15% 18% 17% 9.3% 8.7%
Slide 22: Decrease in cost of funds on better funding mix and lower market rates
Decrease in cost of funds on better funding Banking mix and lower market rates LDR(1) 99% 102% 96% System’s LDR(1) 104% 102% 97% Cost of funds Cost of deposits Ref. rate YoY(3) - 175bps (S/) 61,460 +75bps (US$) 58,572 59,096 8% 7% 11% 12% 13% 15% 4.2% 4.2% 4.0% 4.0% 3.6% 36% 39% 38% 3.8% 3.8% 3.6% 3
Slide 23: Plin: 4x increase YoY in transactions and 2.6x in volume
Plin: 4x increase YoY in transactions and 2.6x in Payments volume, increasing customer engagement IBK Share 45% 46% 46% (%) 15.4 +44% YoY 14.2 10.7 QR Share 9% 14% 18% (%) Mar23 Dic23 Mar24 83.4 +4x YoY Users (mn) 76.6 IBK Share 35% 40% 42% (%) 11.9 11.9 +2.6x YoY 21.6 4.6 1Q23 4Q23 1Q24 1Q23 4Q23 1
Slide 24: Acquiring business continues to grow in all segments
Acquiring business continues to grow Payments in all segments +17% YoY +11% YoY Corporate 1.2 1.3 1.4 13.5 15.5 15.1 Mid- Sized Mar23 Dec23 Mar24 1Q23 4Q23 1Q24 Merchants (mn) Volume (S/ bn) SMEs +42% YoY +40% YoY 747 814 1.7 1.6 574 1.2 Micro merchants Mar23 Dec23 Mar24 1Q23 4Q23 1Q24 Micro merchan
Slide 25: We continue to focus on our payment ecosystem
Payments We continue to focus on our payment ecosystem 129 110 111 Additional cash flow Increased float in merchants’ -13% QoQ coming to IBK accounts +1% YoY IBK accounts +20% YoY +40% YoY 1Q23 4Q23 1Q24 Izipay - Revenues (S/ mn) 32 25 26 +6% QoQ Greater transactional volumes Float from micro mercha
Slide 26: Sustained growth on annuities and diversified revenue generation
Insurance Sustained growth on annuities and diversified revenue generation Annuities %chg %chg market 28.8% 24.2% 28.9% 31.3% QoQ YoY (1) share 300 310 266 61 49 +24% +65% 37 212 85 90 +6% +18% 44 76 71 65 74 77 +4% +18% 34 58% 51% 88 92 82 -11% -7% 61 (2) 2019 1Q23 4Q23 1Q24 Quarterly gross premium
Slide 27: 11.5% YoY growth in wealth management's AUM
Wealth 11.5% YoY growth in wealth management’s AUM management and slight recovery of investment portfolio AUM (US$ mn) Diversified revenue generation (S/ mn) 6,250 6,462 Net Interest Income Net Fee Income Other Income 5,793 +3.5% QoQ +11.5% YoY Fee’s as % of AuM 0.7% 0.6% 0.6% 1Q23 4Q23 1Q24 70 67 4
Slide 28: Takeaways
1 2 Sustainable Building a growth digital platform 3 Key businesses 4 Takeaways
Slide 29: ESG updates
ESG updates Sustainability update Environmental Social Governance & Economic Great Place to Work 2024 New Green Financings IFS was included in S&P's Sustainability Yearbook 2024 Financing related to agricultural and forestry activities holding Sustainability Certifications for up to Interbank #1 in
Slide 30: Operating trends 1Q24
Operating trends 1Q24 Capital Profitability Loan growth 2024 3M24 2024 3M24 Guidance Actual Guidance Actual Mid single digit growth IBK TCR > 14% 15.1% IFS ROE > 12% 5.6% in total loans(1) IBK CET1 ∼ 11% 11.3% To remain at sound levels Still below midterm range Total loans +2.2% Revenues Cost of ris
Slide 31: Takeaways
Takeaways 1 2 3 In 2024, macro environment Investment portfolio Selective growth in retail is showing first recovery impacted by mark-to-market banking with a slight signs with upside potential improvement in CoR 4 5 6 Impulso MyPerú enables Tight management of We continue strengthening growth in co
Slide 32: Appendix
Appendix
Slide 33: IFS key indicators 1Q24
IFS key indicators 1Q24 11.5% 11.6% 5.1% 5.5% 5.3% 5.6% ROE NIM 1Q23 4Q23 1Q24 1Q23 4Q23 1Q24 5.2% 4.7% 1.3% 3.2% 1.2% Banking 0.6% ROA CoR 1Q23 4Q23 1Q24 1Q23 4Q23 1Q24 IFS 5.1% 5.2% 5.2% 39.1% 36.2% 38.7% NIM C/I ratio 1Q23 4Q23 1Q24 1Q23 4Q23 1Q24 6.5 management 5.8 6.3 37.1% 36.2% 37.3% Wealth C
Slide 34: Customer base growth continues across businesses
Customer base growth continues across businesses 5.2 4.6 +12% YoY 2.5 2.9 +14% YoY Mar23 Mar24 Mar23 Mar24 Banking – customers (mn) (1) Insurance – customers (mn) 1.4 1.2 68 76 +12% YoY +17% YoY Mar23 Mar24 Mar23 Mar24 Wealth management – customers (th) Payments – merchants (mn) 34 (1) New methodolo
Slide 35: Insurance investment portfolio
Insurance Insurance investment portfolio Insurance - ROIP (%) Insurance - Portfolio breakdown 6.6% 5.0% 10% 10% 6% 5% 84% 85% 1Q23 1Q24 1Q23 1Q24 Fixed Income Equity and Mutual Funds Real Estate 35
Slide 36: Sound capitalization levels
Sound capitalization levels Banking System 16.7% 16.4% 17.1%(1) 145.6% 129.3% TCR 118.8% Insurance 100.0% Reg. min. 1Q23 4Q23 1Q24 15.2% 15.5% 15.1% 11.8% 11.3% 11.1% Solvency ratio Banking 11.0% Reg. 6.5% 17.6% management min. Reg. 16.2% 17.4% min. Wealth 12.0% Reg. min. 1Q23 4Q23 1Q24 1Q23 4Q23 1Q
Slide 37: Focusing on low-risk loans & retail deposits
Focusing on low-risk loans & retail deposits Breakdown of loans (S/ mn) Funding structure (S/ mn) %chg %chg %chg %chg 1Q23 4Q23 1Q24 QoQ YoY 1Q23 4Q23 1Q24 QoQ YoY Consumer loans Credit cards & other loans 10,358.0 9,951.0 9,340.1 -6.1% -9.8% Deposits 46,247.0 46,053.6 48,090.4 4.4% 4.0% (1) Payroll
Slide 38: Contained banking NPLs despite growth in provisions
Contained banking NPLs despite growth in provisions, S2 reflects rescheduling (S2+S3) ratio & S3 NPL ratio (%) Impairment loss on loans, net (S/ mn) & Cost of risk (%) 6.0% 616 14.1% 14.0% 581 549 5.0% 11.2% 5.0% 5.2% 4.0% 417 4.7% 368 (1) 3.0% 278 3.6% 1,291 210 3.2% 3.2% 3.4% 2.0% 152 2.5%(1) 2.6%
Slide 39: Reactiva loan balances down 63% YoY
Reactiva loan balances down 63% YoY, representing 1% of Interbank’s portfolio Reactiva Peru loan balances by segment (S/ bn) 1Q24 Segment YoY Corporate -65% 1.7 Corporate: n.m. Mid-sized -63% Mid-sized: S/ 0.4 bn SME: S/ 0.2 bn SME -63% 0.8 0.6 Total -63% 1Q23 4Q23 1Q24 39 SME Mid-sized Corporate
Slide 40: Manageable dollarization levels at Interbank
Manageable dollarization levels at Interbank Total loans Retail loans Commercial loans % PEN 68% 72% 90% 93% 57% 58% System 7% 4% 27% 26% 50% 54% 93% 96% 73% 74% 50% 46% 1Q19 1Q24 1Q19 1Q24 1Q19 1Q24 Retail loans breakdown Commercial loans breakdown Consumer Mortgages Corporate Medium Small & Micro
Slide 41: IFS' 1Q24 statement of financial position
IFS’ 1Q24 statement of financial position Intercorp Financial Services' Statement of financial position S/ million %chg %chg 03.31.23 12.31.23 03.31.24 03.31.24 03.31.24 12.31.23 03.31.23 Assets Cash and due from banks and inter-bank 12,448.5 10,343.6 13,361.2 29.2% 7.3% funds Financial investments
Slide 42: IFS' 1Q24 P&L
IFS’ 1Q24 P&L Intercorp Financial Services' P&L statement S/ million %chg %chg 1Q23 4Q23 1Q24 QoQ YoY Interest and similar income 1,658.0 1,805.0 1,800.2 -0.3% 8.6% Interest and similar expenses -584.6 -681.5 -667.0 -2.1% 14.1% Net interest and similar income 1,073.5 1,123.5 1,133.2 0.9% 5.6% Impair
Slide 43: Banking segment's 1Q24 statement of financial position
Banking segment’s 1Q24 statement of financial position Banking Segment' Statement of financial position S/ million %chg %chg 03.31.23 12.31.23 03.31.24 03.31.24 03.31.24 12.31.23 03.31.23 Assets Cash and due from banks and inter-bank 10,810.7 9,123.4 12,200.0 33.7% 12.9% funds Financial investments
Slide 44: Banking segment's 1Q24 P&L
Banking segment’s 1Q24 P&L Banking Segment's P&L statement S/ million %chg %chg 1Q23 4Q23 1Q24 QoQ YoY Interest and similar income 1,384.6 1,556.0 1,510.4 -2.9% 9.1% Interest and similar expenses -525.5 -619.0 -596.2 -3.7% 13.5% Net interest and similar income 859.1 937.0 914.2 -2.4% 6.4% Impairment
Slide 45: Insurance segment's 1Q24 statement of financial position
Insurance segment’s 1Q24 statement of financial position Insurance Segment' Statement of financial position S/ million %chg %chg 03.31.23 12.31.23 03.31.24 03.31.24 03.31.24 12.31.23 03.31.23 Assets Cash and due from banks and inter-bank 558.4 266.3 539.4 n.m. -3.4% funds Financial investments 11,67
Slide 46: Insurance segment's 1Q24 P&L
Insurance segment’s 1Q24 P&L Insurance Segment's P&L statement S/ million %chg %chg 1Q23 4Q23 1Q24 QoQ YoY Interest and similar income 228.1 196.9 238.8 21.2% 4.7% Interest and similar expenses -30.4 -32.6 -42.3 29.9% 39.4% Net interest and similar income 197.8 164.4 196.4 19.5% -0.7% Recovery (loss
Slide 47: Wealth management segment's 1Q24 statement of financial position
Wealth management segment’s 1Q24 statement of financial position Wealth Management Segment' Statement of financial position S/ million %chg %chg 03.31.23 12.31.23 03.31.24 03.31.24 03.31.24 12.31.23 03.31.23 Assets Cash and due from banks and inter-bank 988.2 845.0 509.2 -39.7% -48.5% funds Financia
Slide 48: Wealth management segment's 1Q24 P&L
Wealth management segment’s 1Q24 P&L Wealth Management Segment's P&L statement S/ million %chg %chg 1Q23 4Q23 1Q24 QoQ YoY Interest and similar income 43.8 49.0 48.0 -2.0% 9.5% Interest and similar expenses -22.6 -29.0 -27.6 -5.1% 21.9% Net interest and similar income 21.2 20.0 20.5 2.5% -3.7% Impai
Slide 49: Payments segment's 1Q24 statement of financial position
Payments segment’s 1Q24 statement of financial position Payments Segment' Statement of financial position S/ million %chg %chg 03.31.23 12.31.23 03.31.24 03.31.24 03.31.24 12.31.23 03.31.23 Assets Cash and due from banks and inter-bank 107.1 130.1 141.2 8.5% 31.8% funds Financial investments 53.1 56
Slide 50: Payments segment's 1Q24 P&L
Payments segment’s 1Q24 P&L Payments Segment's P&L statement S/ million %chg %chg 1Q23 4Q23 1Q24 QoQ YoY Interest and similar income 1.7 3.0 2.9 -2.5% 71.6% Interest and similar expenses -1.1 -1.2 -1.2 -4.5% 10.8% Net interest and similar income 0.6 1.8 1.7 -1.1% n.m. Fee income from financial servi
Slide 51: Definitions
Definitions Concept Definition Net interest and similar income + Net fee income from financial services + Other income Total revenues + Income from insurance results (Salaries and employee benefits + Administrative expenses + Depreciation and amortization) / (Net Efficiency ratio interest and simila
Slide 52: Safe Harbor for Forward-Looking Statements
Safe Harbor for Forward-Looking Statements This corporate presentation contains “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1955. Other than statements of historical or current facts, all statements included in this presentation regarding IFS’ b
Slide 53: Intercorp Financial Services
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Intercorp Financial Services Inc. Common Shares — Q1 2024 Earnings Presentation on 6ix