Bawag Group Ag · VIE:BG
Bawag — Investor Day (March 2025)
29 slides from Bawag's investor day presentation, Mar 4, 2025
Slide 1: Investor Day
INVESTOR DAY 4 March 2025
Slide 2: Welcome to BAWAG's Investor Day
WELCOME TO BAWAG’s INVESTOR DAY SAT ENVER ANAS SHAH SIRUCIC ABUZAAKOUK Deputy CEO Deputy CEO CEO BAWAG Group 22
Slide 3: BAWAG Group Franchise Overview
BAWAG GROUP FRANCHISE OVERVIEW THE LONG ARC OF OUR TRANSFORMATION FRANCHISE Multi-brand and multi-channel commercial bank with over 4 million customers across our core markets TRACK RECORD OF Average Return on Tangible Common Equity (RoTCE) 18% since 2012 … RoTCE > 20% through all cycles DELIVERING
Slide 4: Our Performance Since Our IPO
OUR PERFORMANCE SINCE OUR IPO OUTPERFORMING THE MARKET Earnings per share Total Shareholder Return since IPO (in €) Indexed as of 24 October 2017; as of 28 February 2025; share price of €97.10 12% 9.6 300 201% CAGR BAWAG Group +201% 8.3 250 outperformance vs EuroStoxx Banks Index (SX7E) +110pts 5.8
Slide 5: Our Core Principles
OUR CORE PRINCIPLES HOW WE RUN THE BANK PATIENCE & GOOD STEWARDS CULTURE & DISCIPLINE OF CAPITAL COMMITMENT Earnings per share 23x €9.60 2x 4.5% CUSTOMER LOAN BOOK OWNERSHIP SENIOR 2012 - 2024 LEADERSHIP TEAM €4.43 14 14 years M&A DEALS €0.42 AVERAGE TIME AT BAWAG OF COMPLETED SENIOR LEADERSHIP TEAM
Slide 6: The Evolution of Our Franchise
THE EVOLUTION OF OUR FRANCHISE PATIENT & DISCIPLINED … ROTCE >20% THROUGH THE CYCLE CONSISTENT STRATEGY KEY METRICS FRANCHISE Core revenues ~€2.5b Business and geographic mix … 6% CAGR Retail & SME + DACH/NL focused €1.6b GROWTH €0.8b €1.0b ~50% ~90% in core markets through loan growth & M&A … Focus
Slide 7: M&A as a Differentiator
M&A AS A DIFFERENTIATOR MERITS OF STAYING PATIENT & DISCIPLINED WHAT WE ACQUIRED WHAT WE DO LOOKING AHEAD... ✓ IN-HOUSE TEAM FOR 6 Banks DD & INTEGRATION ✓ ENHANCE TECH/OPS AND BEING AN ACTIVE PLAYER CENTRAL FUNCTIONS IN EUROPEAN BANKING Product Factories / 6 Specialty Finance CONSOLIDATION ✓ PROVID
Slide 8: Building a Resilient Franchise
BUILDING A RESILIENT FRANCHISE BEING GOOD STEWARDS OF CAPITAL BUSINESS MODEL GENERATING SIGNIFICANT CAPITAL FROM 2012 – 2024 ENABLING US TO … STRENGTHENING CUSTOMERS INVESTMENTS M&A SHAREHOLDERS CAPITAL BASE O WPI;D 2x growth €1.7 billion 14 deals €1.8 billion €3.0 billion Customer loans doubled Agg
Slide 9: The BAWAG Culture
THE BAWAG CULTURE OUR FOUNDATION LEADERSHIP & 14 years EMBRACING CHANGE average tenure of SLT >50 MERITOCRACY, DIVERSITY & INCLUSION MANAGEMENT BOARD Nationalities working in BAWAG 6 members Contracts extended until end of 2029 SIMPLE & FLAT 3 layers ORGANIZATION Banding structure EXECUTIVE COUNCIL
Slide 10: Our 2027 Targets
OUR 2027 TARGETS FOCUSED ON DELIVERING ON OUR COMMITMENTS 2025 thru 2027 2025 thru 2027 2027 Target 2027 Target >€2.7b >375bps >€1b >€1b Net profit Average gross capital Net profit Excess capital generation per year BAWAG July 18, 2024 Group BAWAG Group 10
Slide 11: Our Retail Franchise
= NZ NC Group OUR RETAIL FRANCHISE
Slide 12: Retail & SME Transformation
RETAIL & SME TRANSFORMATION JOURNEY TO BECOMING A DIGITAL BANK DIGITAL BANK WITH HIGH PLANTING THE SEEDS QUALITY ADVISORY NETWORK FOR GROWTH RIGHT SIZING THE BUSINESS ✓ >4m customers across 7 geographies ✓ Heavy investment into technology ✓ Focus on integration of new acquisitions ✓ Exited non-core
Slide 13: Consistent Retail & SME Strategy
CONSISTENT RETAIL & SME STRATEGY LEADING TO A DIGITAL BANK WITH AN ADVISORY FOCUSED BRANCH NETWORK Strategic Pillars Digital Bank w/ • Positioned to bank Customers across multiple channels > 4 million Advisory via • Branch transformation – transactional banking online, advisory via branch Branch Net
Slide 14: Comprehensive Product Offering
COMPREHENSIVE PRODUCT OFFERING DELIVERING SIMPLE, EASY, TRANSPARENT & DIGITAL PRODUCTS TO OUR CUSTOMERS Offering Cards & Brokerage • Broad-based products stitched together over time Revolvers Auto Financing Building • Protecting our customers by offering affordable, Society transparent & simple prod
Slide 15: Multi-Channel Strategy
MULTI-CHANNEL STRATEGY LEVERAGE TRADITIONAL AND DIGITAL CHANNELS TO REACH OUR CUSTOMERS Branch Digital DIGITAL BANK STRATEGIC PARTNERS • High-touch advisory meetings • Frictionless customer experience • Embedded within brokers, dealers, platforms & partners • More complex fee generating • Relevant o
Slide 16: Leveraging Technology as an Enabler
LEVERAGING TECHNOLOGY AS AN ENABLER … SIGNIFICANT INVESTMENT TO SUPPORT GROWTH >€700m Technology Annual technology spend Technological leadership as a competitive advantage Investments % share of operational expenses 100% Cloud 100% In-House Central Customer Other applications, ML/AI development & S
Slide 17: The Evolution of Our Digital Sales
THE EVOLUTION OF OUR DIGITAL SALES COMBINING TECHNOLOGY, DATA & MARKETING TO GROW COMBINED STRATEGY DRIVING EFFICENCY GROWING OUR FRANCHISE Performance marketing Majority of marketing spend focused on 50% ✓ LOWER COST TO SERVE Marketing digital channels (SEA, SEO, etc) with dynamic channel allocatio
Slide 18: Strategic Acquisition of Strong Digital Franchises
STRATEGIC ACQUISITION OF STRONG DIGITAL FRANCHISES €600m CAPITAL DEPLOYED, >€350m PBT BY 2027 KNAB HIGHLY COMPLEMENTARY ADDITIONS … • Leading digital bank in Dutch self-employed space CORE MARKETS • Mono-line payments provider with 400k customers sizeable platforms in 2 core markets creating "Beachh
Slide 19: Strong Track Record of Integrations
FRANCHISE BUILT ON CONSISTENT STRATEGY AND EXECUTION STRONG TRACK RECORD OF INTEGRATIONS WHAT WE DO … HOW WE DO IT … LEADING TO … Transitional Service Agreement ✓ In-house teams Strong, sustainable & efficient franchises (TSA & disentanglement) ✓ No third party reliance ✓ ~12-month process <33% >€
Slide 20: Harvesting the Investments of the Past
FRANCHISE BUILT ON CONSISTENT STRATEGY AND EXECUTION HARVESTING THE INVESTMENTS OF THE PAST REDUCED COMPLEXITY FOUNDATION BUILT 2012 TODAY Optimized footprint, products Leading Retail & CORE MARKETS DIVERSIFIED 1 7 and processes SME franchise becoming a Digital Bank with an Advisory Branch CORE PROD
Slide 21: Financial Update
= NZ NC Group FINANCIAL UPDATE
Slide 22: Our Financial Principles
OUR FINANCIAL PRINCIPLES HOW WE RUN THE BANK >300bps 33% <1% NET INTEREST MARGIN COST-INCOME RATIO NON-PERFORMING LOAN RATIO • Not chasing the market • Efficiency part of our DNA • Low risk, stable region • Bottom-line vs. volume • Owner-operator mindset • Low leverage • Retail & SME focus • Scalabl
Slide 23: Path to 2027 Targets
PATH TO 2027 TARGETS STEERING OUR BUSINESSES CAGR 2012 2024 2025 2027 in € million ’25 –’27 Net interest income 582 1 312 >1 800 ~2,100 KEY PROFITABILITY DRIVERS + Interest income growth and positive outlook Net commission income 195 310 >350 >380 + Strong underlying trend in fees and commissions Co
Slide 24: Core Revenues
CORE REVENUES NET INTEREST INCOME NET COMMISSION INCOME NIM EXPANSION EXPECTED PAYMENTS AND CARDS GROWTH >300bps - Deposit margin compression + Higher margin asset mix 2/3 + Strong C/A trend from Knab + Growing credit card business in Germany + Stable Austrian business Growing NIM + Loan Growth Paym
Slide 25: Operating Expenses
OPERATING EXPENSES MANAGING THE ABSOLUTE COST BASE TRANSFORMED OWNERSHIP & ACCOUNTABILITY • From transactional to advisory retail bank • Reduced branch footprint by >90% <€800m • In-house functions and expertise • No reliance on 3rd parties and consultants • Sales in the field, centralized support f
Slide 26: Resilient Business Model
RESILIENT BUSINESS MODEL PROTECTING THE FRANCHISE LONG-TERM Business model and strategy limiting HIGH ASSET QUALITY … LONG-TERM RESILIENCE OVER THE CYCLE certain risk-areas through focus on … NPL ratio • Focus on risk-adjusted returns versus volume growth (1.7pts) • Centralized risk management and p
Slide 27: Our Targets: Opportunities & Uncertainties
OUR TARGETS OPPORTUNITIES & UNCERTAINTIES OPPORTUNITIES UNCERTAINTIES EXCESS EXCESS RATE CREDIT CAPITAL CASH ENVIRONMENT CYCLE Generating >375bps organic ~80% granular retail deposits ECB rate RoTCE Significant downturn leading CET1 (2025 – 2027) on & covered bond program to a sharp increase in aver
Slide 28: Thank You
= NZ NC Group THANK YOU
Slide 29: Important Disclaimer
IMPORTANT DISCLAIMER: This presentation is prepared solely for the purpose of providing general information about BAWAG Group, Wiedner Gürtel 11, 1100 Wien. The information does not constitute investment or other advice or any solicitation to participate in investment business. This presentation doe