Brd Groupe Societe Generale Sa (romania) · BVB:BRD
Brd Groupe Societe Generale Sa (romania) — BRD - Groupe Société Générale — Q4 2018 Earnings Presentation
31 slides from Brd Groupe Societe Generale Sa (romania)'s earnings presentation, Feb 8, 2019
Slide 1: BRD Group Results 4th Quarter and Full Year 2018
BRD - GROUP R E S U LT S 4 TH Q U AR T E R AN D F U L L Y E AR 2 0 1 8 8 FEBRUARY 2019
Slide 2: Disclaimer
DISCLAIMER The preliminary consolidated and separate financial position and income statement for the period ended December 31, 2018 were examined by the Board of Directors on February 5, 2019. The financial information presented for the period ended December 31, 2018 and comparative periods has been
Slide 3: Introduction
INTRODUCTION BRD
Slide 4: 2018: A Year Marked by Strong Financial Results
2018: A YEAR MARKED BY STRONG FINANCIAL RESULTS Double digit growth in revenues on higher contribution from all business lines NBI Solid increase of avg. outstanding of retail loans (+6.1% y/y) and RON 3,117m +11.9% vs 2017 deposits (+7.9% y/y) Accelerated growth in gross operating income GOI RON 1,
Slide 5: Q4 2018: Sustained Revenue Growth Supporting Steady Profitability
Q4 2018: SUSTAINED REVENUE GROWTH SUPPORTING STEADY PROFITABILITY NET BANKING INCOME(RON m) Healthy NBI growth Increase in both net interest income (+16.1% y/y) and non interest income revenues (+10.6% y/y) in Q4 2018 vs. Q4 2017 +14.1% +8.7% 827 725 667 Net cost of risk write-backs Net cost of risk
Slide 6: Macroeconomic & Banking Environment
2 MACROECONOMIC & BANKING ENVIRONMENT
Slide 7: Softer Economic Growth in 2018
SOFTER ECONOMIC GROWTH IN 2018 Economic growth slows down GDP GROWTH GDP growth momentum slowed in 2018 (+4.2%* y/y in Q3 2018) after the peak in 2017, given the slower rise in private consumption 7.0% (which remains the main growth determinant), while investment activity was still subdued 4.8% 4.0%
Slide 8: Loan Growth Acceleration
LOAN GROWTH ACCELERATION ROMANIAN BANKING SYSTEM LOANS (RON bn) Loan growth acceleration Y/Y* Housing loans continued to rise at double-digit rate (+11.0%*) 263 +7.4% 233 239 Consumer loans increased steadily (+6.7%*) due to rising disposable income driven by a tight job market and rising public 117
Slide 9: Sound Risk Profile
SOUND RISK PROFILE ROMANIAN BANKING SYSTEM NPL RATIO Further improving risk profile 20.7% Declining trend in NPL ratio as a result of write off operations and sale of defaulted loans portfolios, as well as positive lending dynamics 13.6% NPL ratio at 5.0% at November 2018 end, compared to 20.7% at 2
Slide 10: 4th Quarter and Full Year 2018 BRD Group Results
3 4TH QUARTER AND FULL YEAR 2018 BRD GROUP RESULTS
Slide 11: Continuous Enhancement of Digital Solutions
CONTINUOUS ENHANCEMENT OF DIGITAL SOLUTIONS DIGITAL BANKING SOLUTIONS* ContAll – the first bank account aggregator on the market 970 ContAll, launched in November 2018, allows MyBRD Mobile 932 users to have, in a single place, a quick and comprehensive 832 overview of their accounts at multiple ba
Slide 12: Loan Growth Driven by Both Retail and Large Corporate Segments
LOAN GROWTH DRIVEN BY BOTH RETAIL AND LARGE CORPORATE SEGMENTS NET LOANS Retail loans up +3.7%* y/y (outstanding amounts, RON bn) Y/Y* Consumer loans up by +7.0%* 30.4 +4.0% 28.5 29.2 Focus on higher mass market customers with sound risk +4.6% 8.2 8.6 profile, as reflected by the +22% increase in av
Slide 13: Large and Growing Retail Deposit Base Ensuring Stable Funding Sources
LARGE AND GROWING RETAIL DEPOSIT BASE ENSURING STABLE FUNDING SOURCES Retail savings continued to rise DEPOSITS Retail deposits up by +7.1%* y/y due to higher inflows in current (outstanding amounts, RON bn) Y/Y* accounts (+21%* y/y) 44.2 45.2 +2.2% Corporate deposits pragmatically adjusted as BRD i
Slide 14: Strong and Broad-Based Revenue Growth
STRONG AND BROAD-BASED REVENUE GROWTH NET BANKING INCOME (RON m) Revenue growth momentum maintained Solid net banking income increase, on the back of both interest Y/Y and non interest income growth 827 +14.1% +14.1% in Q4-2018 vs. Q4-2017 725 85 +15.9% +11.9% in 2018 vs. 2017 Other income 74 20
Slide 15: Improved Operational Efficiency
IMPROVED OPERATIONAL EFFICIENCY OPERATING EXPENSES (RON m) Marginally increasing operating expenses (+1.1% y/y) in 2018 vs. 2017 Y/Y 410 reduced annual contribution to Bank Deposit 385 -6.1% Guarantee Fund and Resolution Fund (-50.5% y/y) Staff expenses 215 194 -9.5% …almost compensating staff c
Slide 16: Improved Asset Quality
IMPROVED ASSET QUALITY GROSS LOANS – December 31, 2018 breakdown by segment and currency (RON bn) Loan portfolio market mix 69.4% on individuals market segment 30.6% on legal entities market segment 21.3 20.3 Consolidation of RON lending Share of RON denominated loans at 66.4% (vs 61.9% as of Decemb
Slide 17: Negative Cost of Risk
NEGATIVE COST OF RISK COST OF RISK EVOLUTION (RON m) 500 2,083 1,883 400 Net cost of risk at -89 bps in Q4 2018 300 1,193 1,193 Significant net provision reversals related to recoveries both from 200 800 198 recent defaults and still legacy portfolio 631 137 461 100 Limited new defaults 0 -95 -69 -2
Slide 18: Very Robust Operating Performance Leading to Strong Profitability
VERY ROBUST OPERATING PERFORMANCE LEADING TO STRONG PROFITABILITY NET PROFIT (RON m) Strong full year results driven by broad based revenue growth and cost of risk write-backs 423 +21.2% - incl. non recurring items Net profit, up by +23.6% y/y excluding the positive non- 349 recurring elements relat
Slide 19: Solid Capital Position
SOLID CAPITAL POSITION SOLVENCY RATIO Solid Tier 1 capital base CAR of 21.1% at December 2018 end, comfortably above regulatory requirement Regulatory own funds composed solely of tier 1 capital +149bp -15bp -9bp +6bp -1bp RWA decreased on a yearly basis as a result of 19.76% 21.06% collaterals’ eli
Slide 20: Conclusions
CONCLUSIONS BRD
Slide 21: Conclusions
CONCLUSIONS Broad based revenue growth pushed by strong commercial dynamic, as reflected by loans and deposits volume advance Further enhancement of digital product offer, with new features implemented like the recently launched bank account aggregator (ContALL) through which BRD positioned its
Slide 22: An Active Engagement in the Romanian Society
AN ACTIVE ENGAGEMENT IN THE ROMANIAN SOCIETY SPORT CULTURE •Journalism – culture and education: Scena9.ro, Scoala9.ro • WTA Tournament - BRD Bucharest Open • Platform for the new creators: Rezidenta BRD Scena9 • Romanian Handball Federation •Classical Music: Sonoro, Stradivarius •Performing Arts: Si
Slide 23: Recognized Excellence
RECOGNIZED EXCELLENCE Bank of the Year in Romania Bank of the Year in Romania Best Trade Finance Provider in Romania Best Investment Fund – Simfonia, BRD Asset Management Friendliest Bank for Youth, Romania Best FX Provider e-product: ContALL - the first bank account aggregator (MyBRD Mobile) Best S
Slide 24: Q&A Session
Q&A SESSION BRD
Slide 25: Appendix
APPENDIX BRD
Slide 26: 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 Q4-2018 Q4-2017 Change 2018 2017 Change Net banking income 827 725 +14.1% 3,117 2,786 +11.9% Operating expenses (385) (410) -6.1% (1,489) (1,473) +1.1%
Slide 27: BRD | Key Figures for Bank Only
BRD | KEY FIGURES FOR BANK ONLY RON m Q4-2018 Q4-2017 Change 2018 2017 Change Net banking income 777 680 +14.3% 2,981 2,641 +12.8% Financial results Operating expenses (359) (385) -6.7% (1,400) (1,388) +0.9% Gross operating income 418 295 +41.8% 1,581 1,254 +26.1% Net cost of risk 69 95 -27.1% 246 3
Slide 28: BRD | Stock Price Performance
BRD | STOCK PRICE PERFORMANCE Market capitalisation 4,000 EUR 1.7 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 29: Financial Calendar for 2019
FINANCIAL CALENDAR FOR 2019 7th February: Preliminary 2018 financial results and annual press conference 18th April: General Shareholders Meeting for approving the 2018 annual financial results 3rd May: Presentation of the 1st quarter 2019 financial results 1st August: Presentation of the 2n
Slide 30: 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 31: BRD Groupe Societe Generale - Investor Relations
BRD GROUPE SOCIETE GENERALE - INVESTOR RELATIONS +4 021 380 47 62 investor@brd.ro www.brd.ro
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