Erste Group Bank Ag · VIE:EBS

Erste Group Bank — FY2023 Earnings Presentation

25 slides from Erste Group Bank's earnings presentation, Feb 29, 2024

  1. Slide 1: Annual results 2023

    PRESS CONFERENCE, 29 FEBRUARY 2024 Annual results 2023 Willi Cernko, Chief Executive Officer Stefan Dörfler, Chief Financial Officer Alexandra Habeler-Drabek, Chief Risk Officer Ingo Bleier, Chief Corporates & Markets Officer

  2. Slide 2: GDP growth in 2023: Gloomy macro environment

    GDP growth in 2023: Gloomy macro environment -0.4% +1.1% -0.7% -0.9% +2.0% +2.4% eurozone +0.5% +2.5% Erste region Ø +0.3% Sources: Erste Group Research; European Commission 2

  3. Slide 3: GDP forecast for 2024: CEE back on the growth path

    GDP forecast for 2024: CEE back on the growth path +1.4% +2.0% +0.6% +2.0% +2.6% +2.5% eurozone +0.7% +3.3% Erste region Ø +1.7% Sources: Erste Group Research; European Commission 3

  4. Slide 4: GDP forecast for 2025: Growth solidifies

    GDP forecast for 2025: Growth solidifies +3.1% +2.7% +1.6% +3.4% +3.9% +2.6% eurozone +1.1% +3.6% Erste region Ø +2.8% Sources: Erste Group Research; European Commission 4

  5. Slide 5: Budget deficits: Declining new indebtedness

    Budget deficits: Declining new indebtedness IN % OF GDP eurozone Ø 2023 2024e 2025e Maastricht criteria 2023: -3.2% 2024e: -2.8% 2025e: -2.7% AT CZ SK HU RO HR RS -0.5 -1.5 -2.0 -2.2 -2.2 -2.3 -2.5 -2.7 -2.7 -2.8 -2.8 -3.6 -4.1 -4.0 -5.0 -5.0 -5.7 -6.0 -6.0 -6.0 -6.5 Sources: Erste Group Research; E

  6. Slide 6: Public debt: CEE clearly below eurozone average

    Public debt: CEE clearly below eurozone average IN % OF GDP eurozone Ø 2023 2024e 2025e Maastricht criteria 2023: 90% 2024e: 90% 76 76 77 2025e: 90% 73 72 72 60 61 61 60 58 58 53 50 50 51 51 48 45 45 46 AT CZ SK HU RO HR RS Sources: Erste Group Research; European Commission 6

  7. Slide 7: Inflation: Strong cooling-off expected in 2024

    Inflation: Strong cooling-off expected in 2024 IN % eurozone Ø 2023 2024e 2025e 2023: 5.5% 2024e: 2.5% 17.6 2025e: 2.1% 12.5 10.7 10.5 10.5 8.1 7.7 5.5 4.7 4.0 4.3 3.5 3.7 3.5 2.7 3.0 3.0 2.7 2.9 2.4 2.2 AT CZ SK HU RO HR RS Sources: Erste Group Research; European Commission 7

  8. Slide 8: Key interest rate: First interest rate cuts in CEE

    Key interest rate: First interest rate cuts in CEE IN % CZ HU RO RS Eurozone 20 16 12 8 4 0 1 1 1 1 1 1 1 1 -0 7 -0 1 -0 7 -0 1 -0 7 -0 1 -0 0 0 0 0 0 0 0 1- 1- 2- 2- 3- 3- 4- 2 02 2 02 2 02 2 02 2 02 2 02 2 02 Sources: Erste Group Research, as of 19.02.2024 8

  9. Slide 9: Labour markets continue to prove robust

    Labour markets continue to prove robust UNEMPLOYMENT RATE, IN % eurozone Ø 2023 2024e 2025e 2023: 6.6% 2024e: 6.6% 2025e: 6.4% 9.4 8.8 8.6 6.3 6.0 5.9 6.0 5.7 5.5 5.5 5.5 5.7 5.1 5.1 4.9 3.9 4.0 3.8 3.6 3.3 2.6 AT CZ SK HU RO HR RS Sources: Erste Group Research; European Commission 9

  10. Slide 10: Risk costs remain at a low level

    Risk costs remain at a low level Risk costs Crisis-induced performing risk provisions In basis points of gross customer loans In EUR mn Macro Covid Ukraine/geopolitical situation 78 928 773 734 740 56 15 15 9 9 117 6 41 2 -4 2015 2016 2017 2018* 2019 2020 2021 2022 2023 2018 2019 2020 2021 2022 2023

  11. Slide 11: NPL ratio increases slightly, but remains at low level

    NPL ratio increases slightly, but remains at low level NPL ratio NPL coverage ratio In % In % 2.3 94.6 85.1 2.0 Dec 22 Dec 23 Dec 22 Dec 23 11

  12. Slide 12: Operating income rises significantly

    Operating income rises significantly IN EUR MN Net interest income Net fee and commission income +23.1% Net trading result and gains/losses from financial instrument at FVPL 10,552 Other operating income 8,571 7,228 5,951 2,640 2,452 449 -47 215 235 2022 2023 12

  13. Slide 13: Operating expenses: Higher on inflationary pressure

    Operating expenses: Higher on inflationary pressure IN EUR MN Personnel expenses Other administrative expenses +9.7% Depreciation and amortisation 5,020 4,575 2,991 2,668 1,356 1,469 551 560 2022 2023 13

  14. Slide 14: Slight increases for loans and deposits

    Slight increases for loans and deposits Loans Deposits Loan-to-deposit ratio Net loans & advances to customers, in EUR bn in EUR bn in % +3.9% +2.8% 232.8 90.2 89.3 224.0 207.8 202.1 Dec 22 Dec 23 Dec 22 Dec 23 Dec 22 Dec 23 14

  15. Slide 15: Strong net result thanks to solid operating performance

    Strong net result thanks to solid operating performance IN EUR MN +38.5% 445 172 875 1,981 2,998 2,165 2022 Operating Operating Risk costs Taxes and 2023 income expenses Other result 15

  16. Slide 16: Strong capitalization provides basis for financing economies

    Strong capitalization provides basis for financing economies CET1 RATIO IN % (CRR, FINAL) 15.7 14.5 14.2 14.2 13.5 13.7 12.8 12.9 12.0 11.2 11.4 10.6 9.2 9.4 8.3 Dec 09 Dec 10 Dec 11 Dec 12 Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Dec 18 Dec 19 Dec 20 Dec 21 Dec 22 Dec 23 16

  17. Slide 17: Corporates and Markets segment: Growth despite challenging environment

    Corporates and Markets segment: Growth despite challenging environment Corporate loans New sustainable loans Operating result Volume on a gross basis, in EUR bn Volume in EUR bn Corp. & Markets segment, in EUR mn +5.5% +21% 78.2 1,923 74.1 1,587 +36% 2.95 2.17 Dec 22 Dec 23 2022 2023 Dec 22 Dec 23 1

  18. Slide 18: Group Markets and Asset Management provide very solid contribution to 2023 result

    Group Markets and Asset Management provide very solid contribution to 2023 result Co-arranged issuances Assets under Management Issuance volume, in EUR bn in EUR bn of which sustainable funds +20% 153.5 128.0 2023 Markets business almost +12.7% reached the level of 2022 78.2 69.4 244 capital market

  19. Slide 19: Digitization successes in corporate clients business

    Digitization successes in corporate clients business powered by the rollout of George Business Roll-out of George Business progresses 37,000 businesses have activated With Financial Health, we bring further George Business so far added value for corporate clients to our Continuous functional enhance

  20. Slide 20: Retail segment

    Retail segment Securities savings plans Housing loans New housing loans Stock, in quantities Stock volume, in EUR bn Volume of new business in the quarter, in EUR bn +23.6% +1.7% -65% 1,165,000 71.7 72.9 5.1 943,000 3.0 2.1 2.0 1.9 1.8 1.7 Dec 22 Dec 23 Dec 22 Dec 23 Q2/22 Q3/22 Q4/22 Q1/23 Q2/23 Q3

  21. Slide 21: Digital innovations aimed at strengthening Financial Health

    Digital innovations aimed at strengthening Financial Health 10 million Digital initiatives for Financial Health users AI-based Financial Health Prototype www.erstebank.ai Fit+ Financial Health Check 1.1 mn Financial Health consultations Every second product sale George Junior Is already concluded di

  22. Slide 22: 20 years after the EU's 2004 enlargement: CEE's unprecedented catch-up story

    20 years after the EU’s 2004 enlargement: CEE’s unprecedented catch-up story Real GDP per capita as % of EU average, adjusted for purchasing power 2004 2022 130 124 90 81 76 75 71 73 63 58 57 44 34 33 AT CZ SK HU RO HR RS Source: Eurostat 22

  23. Slide 23: 20 years after the EU's 2004 enlargement: Strong increase in prosperity across CEE

    20 years after the EU’s 2004 enlargement: Strong increase in prosperity across CEE Per capita financial assets in EUR 2004 2022 +90% 90,295 +94% 74,719 47,431 +301% 38,608 36,188 +204% +291% +430% 22,542 +783% 21,481 18,998 11,634 9,026 7,414 3,583 5,491 1,318 EU27 AT CZ SK HU RO HR Source: Eurostat

  24. Slide 24: Next steps for CEE …

    Next steps for CEE … Digitalization provides the next step in the value chain Financing the green transition remains in focus Capital markets union as a source of funding for "twin transition" Collaboration between politics and business to meet future challenges 24

  25. Slide 25: Erste Group

    ERSTES Group

Erste Group Bank — FY2023 Earnings Presentation on 6ix