Brd Groupe Societe Generale Sa (romania) · BVB:BRD
Brd Groupe Societe Generale Sa (romania) — BRD Groupe Société Générale — FY2019 Earnings Presentation
35 slides from Brd Groupe Societe Generale Sa (romania)'s earnings presentation, Feb 7, 2020
Slide 1: BRD Group Results
BRD GROUP RESULTS 4th quarter and full year 2019 | 07.02.2020
Slide 2: Disclaimer
DISCLAIMER The preliminary consolidated and separate financial position and income statement for the period ended December 31, 2019 were examined by the Board of Directors on February 5, 2020. The financial information presented for the period ended December 31, 2019 and comparative periods has been
Slide 3: Introduction
1 INTRODUCTION BRD GROUPE SOCIETE GENERALE
Slide 4: Solid development of activity
SOLID DEVELOPMENT OF ACTIVITY Expanding volumes on all segments Net loans Strong advance of average loans outstanding, up +4.6% y/y RON 30.8bn, + 4.6% vs 2018 Average outstanding of retail deposits, up +4.0% y/y Rising contribution of growth relays BRD AM Remarkable development of asset management a
Slide 5: High profitability
HIGH PROFITABILITY Strong operating performance C/I* ratio Stable C/I ratio excluding regulatory costs*, supported by growth 46.8%, stable vs 2018 in revenues Acceleration of investments in business model transformation Solid risk profile Decrease in NPL ratio, -147 bps y/y NPL ratio 3.1% vs. 4.6% a
Slide 6: Macroeconomic environment
2 MACROECONOMIC ENVIRONMENT
Slide 7: Still robust economic growth, but widening twin deficits
STILL ROBUST ECONOMIC GROWTH, BUT WIDENING TWIN DEFICITS Decelerating, but still solid economic growth In Q3 2019, real GDP growth shrank to +3.2%* y/y from +4.3%* y/y in the previous quarter GDP GROWTH Growth still dominated by domestic demand 7.0% Robust gross fixed capital formation, with double-
Slide 8: Stable monetary policy stance
STABLE MONETARY POLICY STANCE Inflation rate picked up INTEREST RATE ENVIRONMENT CPI rose at +4.0% y/y at December 2019 end, breaching the upper limit of the central bank’s target interval (2.5% ± 1 ppt) 5.4% Going forward, inflation rate expected to temper, but upside risks still 4.0% present both
Slide 9: 4th quarter and full year 2019 BRD Group results
3 4TH QUARTER AND FULL YEAR 2019 BRD GROUP RESULTS
Slide 10: Continuously enhancing our multi-channel business model
CONTINOUSLY ENHANCING OUR MULTI-CHANNEL BUSINESS MODEL Contact Center Awarded digital channel for individuals Launch of 3 new digital solutions MyBRD Mobile awarded “Product of the dedicated to our corporate customers year 2019” * Specialized Manage your business finances on the Platforms Free
Slide 11: Loan growth driven by both retail and corporate segments
LOAN GROWTH DRIVEN BY BOTH RETAIL AND CORPORATE SEGMENTS NET LOANS (average amounts, RON bn) Y/Y Retail loan growth fueled by demand for both 29.5 30.8 +4.6% consumer and housing loans 8.5 9.1 +7.4% Consumer lending (+5.2% y/y) and housing loans (+4.7% y/y) contributing both to retail loan growth Fo
Slide 12: Strong saving franchise
STRONG SAVING FRANCHISE Large retail deposit base Increasing retail deposits (+4.0% y/y) SAVINGS Corporate deposits influenced by the reduction of EUR non (average outstanding amounts, RON bn) transactional deposits, driven by an assumed balance sheet management choice. Y/Y 47.8 48.9 +2.3% 2.9 3.8 +
Slide 13: Increased focus on alternative savings market
INCREASED FOCUS ON ALTERNATIVE SAVINGS MARKET Very dynamic asset management activity BRD AM’s assets under management up +74% y/y Significant inflow dynamics in 2019 for both BRD Simfonia BRD AM (RON denominated) and Eurofond (EUR denominated), which MARKET SHARE invest mainly in government bonds, f
Slide 14: Good revenue generation dynamic
GOOD REVENUE GENERATION DYNAMIC NET BANKING INCOME (RON m) Consistent revenue generation Net banking income, up by +5.0% y/y in 2019 reflecting strong Y/Y commercial dynamics supported by benign economic conditions 3,270 +5.0% 3,115 Other income 314 -4.7% Strong net interest income growth 329 Net fe
Slide 15: Quasi stable C/I ratio, excluding regulatory costs
QUASI STABLE C/I RATIO, EXCLUDING REGULATORY COSTS OPERATING EXPENSES (RON m) Y/Y 1,678 +12.6% Tax on financial 1,490 75 assets - 72 2.1x Costs’ evolution reflecting labor market tightness, Contributions to 35 ongoing investments in transformation and FGDB & FR 826 768 increasing regulatory costs +7
Slide 16: Strong asset quality
STRONG ASSET QUALITY GROSS LOANS – December 31, 2019 breakdown by segment and currency (RON bn) Loan portfolio market mix 70.2% on individuals market segment 29.8% on legal entities market segment 21.7 21.1 Consolidation of RON lending Share of RON denominated loans at 68.2% (vs 66.3% as of December
Slide 17: Cost of risk supporting the bottom line
COST OF RISK SUPPORTING THE BOTTOM LINE COST OF RISK EVOLUTION 570 Net cost of risk at -73 bps in 2019, and -5 bps in Q4 2019 470 1,883 2,083 370 Significant recoveries from previously written off exposures 270 1,193 1,193 Proceeds from retail portfolio sale 800 198 170 137 631 Insurance indemnities
Slide 18: High profitability level on dynamic commercial performance and strong risk profile
HIGH PROFITABILITY LEVEL ON DYNAMIC COMMERCIAL PERFORMANCE AND STRONG RISK PROFILE NET PROFIT (RON m) Good operational performance Y/Y GOI +4.8% y/y in 2019 vs 2018, excl. contribution to FGDB&RF 1,563 1,499 -4.1% and tax on financial assets Non recurring CoR 69 - as reported 147 - contribution to n
Slide 19: Solid capital position
SOLID CAPITAL POSITION SOLVENCY RATIO Comfortable solvency ratio CAR of 21.4% at December 2019 end Regulatory own funds composed solely of Tier 1 capital Increase in own funds on a yearly basis explained by +143bp +68bp -155bp -22bp higher retained earnings and positive impact of revaluation of bond
Slide 20: Balanced profit allocation policy
BALANCED PROFIT ALLOCATION POLICY Dividend proposal maintained at 1.64 RON/ share GROSS DIVIDEND (RON/share) NET PROFIT (RON m)????? 2019 dividend proposal of 1.64 RON/ share (payout ratio of 75%), subject to AGM approval 1.64 1.64 1.64 Stable vs 2017 and 2018 0.73 Confirmation of the capacity to of
Slide 21: Social responsibility at the heart of our action
4 SOCIAL RESPONSIBILITY AT THE HEART OF OUR ACTION
Slide 22: Volunteering
VOLUNTEERING ZIUA V, BRD’s online platform where employees find volunteering projects that generate change in local communities (like blood donations, meals preparations, Christmas gifts, charity races, greening school yards, cleaning forest…) 1day/year allocated for BRD employees to encourage and s
Slide 23: Education & Technology
EDUCATION & TECHNOLOGY Highlight from a wide range of initiatives BRD First Tech Challenge, a full training robotics program for high school students: technical kits for students, teachers & mentors, coding, pitches, 3D printers, trainings on soft skills 2nd largest independent competition in the wo
Slide 24: Culture
CULTURE CULTURE HIGHLIGHTS IN 2019 Focused to support contemporary culture, and also the new French Romanian season and the generation of artists mainly through our foundation presence of Societe Generale Art FUNDATIA 9 Collection at MNAR Sonoro Conac Scena9, cultural journalism publication on line
Slide 25: Environment
ENVIRONMENT Continuously working on reducing our CO2 footprint. Our actions enabled to reduce our CO2 emissions by 8% from 2016 to 2018 BRD Forests Fund launched in 2019 to support causes related to forests in Romania: monitor and preserve valuable forests educate youngsters and adults on the im
Slide 26: Conclusions
.) CONCLUSIONS BRD GROUPE SOCIETE GENERALE
Slide 27: Conclusions
CONCLUSIONS Another excellent year marked by commercial growth on both retail and corporate segments, strong risk profile, and high profitability Remarkable performance in asset management, with a market share gain of 6.5 ppts, positioning BRD Asset Management in the market top 3 Accelerated i
Slide 28: Q&A session
6 Q&A SESSION BRD GROUPE SOCIETE GENERALE
Slide 29: Appendix
APPENDIX BRD GROUP – KEY FIGURES BRD STANDALONE - KEY FIGURES STOCK PRICE PERFORMANCE FINANCIAL CALENDAR FOR 2020 GLOSSARY – CLIENT SEGMENTATION
Slide 30: BRD Group | Key figures
BRD GROUP | KEY FIGURES (1) Variations at constant exchange rate; (2) Bank only, including impact of prudential filters in Sep-17 and Dec-17; RON m Q4-2019 Q4-2018 Change 2019 2018 Change Net banking income 824 826 -0.3% 3,270 3,115 +5.0% Operating expenses (491) (385) +27.6% (1,678) (1,490) +12.6%
Slide 31: BRD | Key figures for bank only
BRD | KEY FIGURES FOR BANK ONLY RON m Q4-2019 Q4-2018 Change 2019 2018 Change Net banking income 779 777 +0.2% 3,170 2,981 +6.3% Financial results Operating expenses (463) (359) +28.9% (1,580) (1,400) +12.9% Gross operating income 317 418 -24.3% 1,590 1,581 +0.5% Net cost of risk 4 69 -94.6% 224 246
Slide 32: BRD | Stock price performance
BRD | STOCK PRICE PERFORMANCE Market capitalisation 4,000 EUR 2.3 bn 16.0 3,500 3,000 14.0 2,500 12.0 2,000 10.0 1,500 1,000 8.0 500 6.0 0 Volume ('000 shares, rhs) Price (RON, lhs) BRD is part of the main market indices on the Bucharest Stock Exchange BRD is in Top 5 largest domestic companies
Slide 33: Financial calendar for 2020
FINANCIAL CALENDAR FOR 2020 6th February: Preliminary 2019 financial results and annual press conference 23rd April: General Shareholders Meeting for approving the 2019 annual financial results 6th May: Presentation of the 1st quarter 2020 financial results 3rd August: Presentation of the 2nd quarte
Slide 34: Glossary – Client segmentation
GLOSSARY – CLIENT SEGMENTATION The Retail category is comprised of the following customer segments: • Individuals – BRD provides individual customers with a range of banking products such as: savings and deposits taking, consumer and housing loans, overdrafts, credit card facilities, funds transfe
Slide 35: BRD Groupe Societe Generale - Investor Relations
BRD GROUPE SOCIETE GENERALE - INVESTOR RELATIONS +4 021 380 47 62 | investor@brd.ro; www.brd.ro
BRD Groupe Société Générale — FY2019 Earnings Presentation on 6ix