Brd Groupe Societe Generale Sa (romania) · BVB:BRD
Brd Groupe Societe Generale Sa (romania) — BRD - Groupe Société Générale — H1 2018 Earnings Presentation
30 slides from Brd Groupe Societe Generale Sa (romania)'s earnings presentation, Aug 3, 2018
Slide 1: BRD Group Results 2nd Quarter and 1st Half 2018
BRD - GROUP R E S U LT S 2 ND Q U AR T E R AN D 1 ST H A L F 2 0 1 8 AUGUST 2018
Slide 2: Disclaimer
DISCLAIMER The consolidated and separate financial position and income statement for the period ended June 30, 2018 were examined by the Board of Directors on August 1, 2018. The financial information presented for the period ended June 30, 2018 and comparative periods has been prepared according to
Slide 3: Introduction
INTRODUCTION BRD
Slide 4: H1 2018: Net Profit of RON 757m
H1 2018: NET PROFIT OF RON 757M Double-digit revenue growth thanks to dynamic retail banking and rising interest rates NBI RON 1,480m +10.5% vs H1 2017 Net interest income up +13.2% y/y, on growing volumes and rising interest rates Solid increase of average outstanding of net loans (+5.1%) and depos
Slide 5: Q2 2018: Accelerating Revenues Momentum Supporting the Bottom Line
Q2 2018: ACCELERATING REVENUES MOMENTUM SUPPORTING THE BOTTOM LINE NBI excluding non Strong revenue generation recurring items (RON m) NBI up +9.7% vs Q2 2017 on +12.3% higher net interest income Robust commercial dynamics in retail banking +9.7% 756 Retail loans up +6.1% y/y* +3.4% Close to zero co
Slide 6: Macroeconomic & Banking Environment
2 MACROECONOMIC & BANKING ENVIRONMENT
Slide 7: Economic Growth Slowing Down
ECONOMIC GROWTH SLOWING DOWN GDP GROWTH Economic growth slowing down In Q1 2018, the GDP annual growth rate* slowed down to +4.2%, 6.9% while on a quarterly basis it was quasi-stable Easing consumer demand in the first quarter, in an environment 4.8% 4.7% marked by rising inflation and weaker consum
Slide 8: Loan Growth Steadily Backed by Household Demand
LOAN GROWTH STEADILY BACKED BY HOUSEHOLD DEMAND ROMANIAN BANKING SYSTEM LOANS (RON bn) Loans are growing steadily in nominal terms yoy* Continuous double-digit increase in housing loans (+12.2%* y/y) 254 240 245 +5.1% Consumer loans accelerating at +5.5%* y/y, as demand rebounded in 123 126 +1.3% 12
Slide 9: Comfortable Prudential Indicators, High Profitability
COMFORTABLE PRUDENTIAL INDICATORS, HIGH PROFITABILITY ROMANIAN BANKING SYSTEM NPL RATIO NPL ratio continuing the downtrend 20.7% NPL ratio at 6.0% at May 2018 end, compared to 20.7% at 2014 end Further decline in NPL ratio as a result of write off operations and sale of defaulted loans portfolios, a
Slide 10: 2nd Quarter and 1st Half 2018 BRD Group Results
3 2ND QUARTER AND 1ST HALF 2018 BRD GROUP RESULTS
Slide 11: Increasing Adoption of Digital Banking Solutions
INCREASING ADOPTION OF DIGITAL BANKING SOLUTIONS AVERAGE INDIVIDUAL CUSTOMER More intense commercial relationships EQUIPMENT RATE Average equipment rate of individual clients up to 4.22 from 4.13 4.22 at June 2017 4.13 4.16 Average equipment rate of small business clients up to 3.73 from 3.64 at Jun
Slide 12: Further Loan Growth, Mainly Fueled by Dynamic Household Demand
FURTHER LOAN GROWTH, MAINLY FUELED BY DYNAMIC HOUSEHOLD DEMAND LOANS TO INDIVIDUALS PRODUCTION (RON m) Retail loans +6.1%* y/y H1-18 vs. H1-17 Housing loans outstanding up by +11.1% y/y 3,131 3,075 -1.8% 2,869 New housing loans up +8.3% in H1-2018, with increasing share of BRD specific product “La C
Slide 13: Increase in Retail Deposits
INCREASE IN RETAIL DEPOSITS DEPOSITS (outstanding amounts, RON bn) Households savings still on the rise yoy* ytd* Retail savings +6.8%* y/y with deposits in current accounts up by 43.1 44.2 44.3 +1.8% +0.1% 26%* for individual customers -6.2% -4.3% 16.6 16.4 15.7 Non retail deposits decreased in a c
Slide 14: Consistent Revenue Growth
CONSISTENT REVENUE GROWTH NET BANKING INCOME (RONm) Solid revenue growth in both Q2 2018 and H1 2018 YoY Strong revenue generation, thanks to increasing volumes, 756 +9.7% favorable interest rate environment and higher trading result 689 Other income 88 +15.9% 76 Net fee and 195 +1.5% 192 commission
Slide 15: Moderate Increase in Costs
MODERATE INCREASE IN COSTS OPERATING EXPENSES (RON m) Operating costs reflecting ongoing transformation investments and tight labor market YoY Pressure on staff costs, due to adjustment of compensation 353 +5.7% packages in a tight labor market context 334 Rising other expenses on higher IT and cons
Slide 16: Improved Asset Quality
IMPROVED ASSET QUALITY GROSS LOANS – June 30, 2018 breakdown by segment and currency (RON bn) Loan portfolio market mix 68.7% on individuals market segment 31.3% on legal entities market segment 21.0 19.9 Consolidation of RON lending 9.6 10.7 Share of RON denominated loans at 64.9% (vs 59.0% as of J
Slide 17: Negative Cost of Risk
NEGATIVE COST OF RISK COST OF RISK EVOLUTION (RON m) Net cost of risk at -13 bps as a joint result of: Significant net provision reversals (49 MRON) on corporate counterparties, driven mainly by strong recovery performance Recurrent NCR for Individuals (27 MRON), in line with previous quarters’ resu
Slide 18: Strong Profitability, Driven by Solid Operating Performance
STRONG PROFITABILITY, DRIVEN BY SOLID OPERATING PERFORMANCE NET PROFIT (RON m) Strongly increasing net profit, after excluding non- 420 recurring items -18.5% ...supported by the solid operating performance Non-recurring 342 incl. non recurring items 130 items contribution to net profit * H1 2018 ne
Slide 19: Solid Capital Position
SOLID CAPITAL POSITION SOLVENCY RATIO Solid Tier 1 capital base CAR at 18.8% at June 2018, comfortably above -24bp regulatory requirement. +86bp -148bp +30bp -0.02bp Regulatory own funds composed solely of tier 1 capital. Impact of the decrease of the revaluation reserve for 19.37% 18.80% debt instr
Slide 20: Conclusions
CONCLUSIONS BRD
Slide 21: Conclusions
CONCLUSIONS Consistent revenue generation driven by rising volumes of loans, deposits and non-cash transactions Steady loan growth sustained by retail banking Continued improvement of customer experience through further development of digital capacities Very strong operational performance
Slide 22: Q&A Session
Q&A SESSION BRD
Slide 23: Appendix
APPENDIX BRD
Slide 24: BRD Group | Key Figures
BRD GROUP | KEY FIGURES RON m Q2-2018 Q2-2017 Change H1-2018 H1-2017 Change Net banking income 756 689 +9.7% 1,480 1,339 +10.5% Operating expenses (353) (334) +5.8% (738) (718) +2.8% Gross operating income 402 355 +13.3% 742 621 +19.4% Reported financial results Net cost of risk 2 146 -98.9% 154 270
Slide 25: BRD Group | Key Figures
BRD GROUP | KEY FIGURES Loans and deposits RON bn Jun-17 Dec-17 Jun-18 vs. Jun-17 vs. Dec-17 (1) 28.7 29.2 29.8 +2.8% +2.0% Net loans including leasing (RON bn) Retail 20.0 21.0 21.4 +6.1% +1.9% Non retail 8.7 8.2 8.4 -4.7% +2.3% (1) 43.1 44.2 44.3 +1.8% +0.1% Total deposits (RON bn) Retail 26.5 27.
Slide 26: BRD | Key Figures for Bank Only
BRD | KEY FIGURES FOR BANK ONLY RON m Q2-2018 Q2-2017 Change H1-2018 H1-2017 Change Net banking income 757 692 +9.4% 1,438 1,289 +11.5% Financial results Operating expenses (333) (316) +5.5% (697) (679) +2.6% Gross operating income 424 377 +12.6% 741 610 +21.4% Net cost of risk 10 145 -93.4% 160 276
Slide 27: BRD | Stock Price Performance
BRD | STOCK PRICE PERFORMANCE Market capitalisation 4,000 EUR 2.0 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 28: Financial Calendar for 2018
FINANCIAL CALENDAR FOR 2018 8th February: Preliminary 2017 financial results and annual press conference 19th April: General Shareholders Meeting 19th April: General Assembly of Shareholders and publication of the 2017 BoD Report 4th May: Q1-2018 results publication 2nd August: H1-2018 res
Slide 29: 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 30: 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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