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2 0 0 3 R E S U L T S 2 0 0 4 - 0 5 T A R G E T S U P D A T E

2 0 0 3 R E S U L T S 2 0 0 4 - 0 5 T A R G E T S U P D A T E. M a r c h 3 1, 2 0 0 4. 2003 results at a glance. 2003 2002 Change. GROUP NET INCOME (€ mn) 95.5 78.0 * +22.4 %

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2 0 0 3 R E S U L T S 2 0 0 4 - 0 5 T A R G E T S U P D A T E

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  1. 2 0 0 3 R E S U L T S 2 0 0 4 - 0 5 T A R G E T S U P D A T E M a r c h 3 1, 2 0 0 4

  2. 2003 results at a glance 2003 2002 Change GROUP NET INCOME (€ mn)95.5 78.0* +22.4% ROE (goodwill adj.)13.0% 11.1% +190 bp ROE 10.2% 8.9% +130 bp COST / INCOME67.0% 67.1% --- NET NPLs RATIO 1.14% 1.06% + 8 bp * 2002 net income has been adjusted for 2002 Eptaconsors extraordinary dividend

  3. Business segment results 2003 2002 PF 2001 PF 2003 2002 PF 2001 PF as % of gross income Retail banking 126 123 151 56% 62% 72% Consumer credit 75 54 41 33% 27% 19% Product companies 20 19 13 9% 10% 6% Service companies 5 5 4 2% 2% 2% Tax collection 1% -1 -2 2 0% -1% Gross income* 225 199 211 * € mn - Goodwill and taxes excluded

  4. Banks’ spread compression • Strong contribution from consumer credit • Greater commissions and trading income, less dividend payouts • Positive trend for companies at equity Total income Non-interest income Interest margin +4.0% +11.8% € mn € mn Cos at equity 15.0 Dividends 9.3 2003 total income € 1,009.5 mn [+5.7%] % change has been adjusted for 2002 Eptaconsors extraordinary dividend

  5. Avg. total spread 3.29% Avg. total spread 3.14% € mn € mn 2002 quarters 2003 quarters 4Q ’02 1Q 2Q 3Q 4Q’03 Bank customers’ spread* 3 months Euribor Interest margin * Mark-up + mark-down

  6. +11.8% +8.7% +15.8% 2003 2002PF Non-interest income 373.0 Trading inc. +157.3% 333.6 Net other inc. +6.0% Net commissions +7.9% € mn Collect. & pay’t serv. AUM

  7. Change +2.6% +1.1% CAGR 2003 2002 PF Ex Findomestic Personnel exp. 378.7 370.1 2.3% 0.9% Other costs 236.0 223.7 5.5% 4.2% Depreciation 61.3 65.3 -6.1% -6.3% € mn 2002PF 2003 2003 (ex Findomestic)* Total costs • Cost control achieved • Personnel expenses slightly affected by labour contract renewal • Restructuring costs better then expected Goodwill excluded - * The % change is in comparison to “Ex Findomestic 2002PF”

  8. +16.8% Operating and net incomes +12.8% +30.4% -44.1% -13.5% +8.3% +22.4% • Clear improvement in operating income • Prudent provisions management • Assets streamlining • Better tax rate € mn - % change has been adjusted for Eptaconsors 2002 extraordinary dividend

  9. Assets under custody -1.0% Assets under mng. +7.9% Other -12.7% Bonds +14.9% Sight borrowing +7.7% Total financial assets +5.9% 27,838 26,296 Indir. Funding +4.2% Direct funding +7.7% € mn

  10. +7.9% Portfolio composition 8,843 8,198 Insurance products +23.1% Discr. Accounts +20.5% Mutual funds -3.7% 2002 2003 Discr. accounts Insurance prod. Mutual funds Assets under management € mn

  11. +7.1% Public admin. Consumer Credit Retail Small Business Corporate • Good increase despite non-favourable economic cycle • Real estate financing (+ 13.6%): an important contribution • Volumes moved towards retail and P.A. • High portfolio balance thanks to consumer credit Customer loans € mn

  12. Net NPLs cover ratio Gross NPLs/Gross loans Self-liquidating Collateral sec. Personal sec. Net NPLs/Net loans Not secured Other Credit quality 54.4% 53.5% 52.6% 2.40% 2.36% 2.28% Controlled credit risk loans 69% +240 bp 1.14% 1.14% 1.06% 2001 2002 2003 • Credit quality is unchanged • Increase in guaranteed and self-liquidating loans • The internal rating system shows more loans in “good shape”

  13. 278 branches* 13 centers* 9 centers* 366Family portfolio mgrs 109portfolio managers 48portfolio managers 301 Personal portfolio mgrs 14 special prod. advisors 11 staff 272Business portfolio mgrs 8 credit managers 704 staff 117 staff 254 branch managers 12 branch managers Network restructuring program RETAIL CORPORATE & PRIVATE BKG. RETAIL BRANCHES CORPORATE CENTERS PRIVATE BKG. CENTERS STRUCTURE COMPLETED by SEPTEMBER 2003 * Banca CR Firenze only

  14. Capital ratios 2003 2003 1H 2002 2003-02 change Tier 1* 895.6 842.5 896.5 -0.1% Tier 2 816.7 642.1 608.5 34.2% Deductions 92.0 97.6 114.6 -19.7% Regulatory capital 1,620.3 1, 387.0 1,390.4 16.5% Risk weighted assets 15,753.4 15,232.3 14,434.0 9.1% SOLVENCY ratio 10.61% 9.30% 9.80% 0.81 bp TIER 1 ratio 5.68% 5.55% 6.21% - 0.53 bp € mn - * Core capital - No preference shares issued

  15. C A S S A D I R I S P A R M I OD E L L A S P E Z I A

  16. CR Spezia Parma CR Mirandola " " Bologna " CR Spezia " CR Firenze " Strategic rationale • Territorially adjacent to the area currently presided by Banca CR Firenze Group • The opportunity to rationalize the limited number of overlaps • Ideal platform for West-East development • Area of the city of Parma • Possibility of joining forces with the CR Mirandola area • Asset structure efficiency enhancement within an overall group management context

  17. CR Spezia Main characteristics • Company’s main features • Strong franchise- Market share* • funding 46.8%, loans 25.5%, branches 38.% • High level liquidity • loans/funding ratio at 62% • AUM/Indirect funding ratio at 64% • progressive switch to Group companies’ products • Governance rules that will allow real efficiency enhancement • Majority of members of the Board of Directors and the Executive Committee • Appointment of the General Manager * Main business territory (Province of La Spezia) - 30.09.2003

  18. CR Spezia Actions • Rapid Group integration • Extension of the Banca CR Firenze business model • Centralization of key functions, such as • Planning & Risk Management • Finance • Auditing • Asset Managment • Accounting • Support for innovative commercial actions • Transfer of decision-making powers to the local level • Strengthen risk control • Enrichment of the product range

  19. 2003 results at a glance 2003 2002Change NET INCOME 2.9 5.0 -42.0% ROE 1.9% 3.3% -140 bp COST / INCOME75.0% 78.1% -310 bp TAX RATE 75.9% 60.6% +1,530 bp TOTAL FIN. ASSETS 2.955 2,871 +2.9% of which AUM 930 848 +9.7% CUSTOMER LOANS 845 844 --- Net NPLs ratio 3.2% 3.4% -20 bp € million

  20. Net income ROE Targets Cost/income Tax rate € mn 2003 2006 2003 2006 • Total financial assets +7% CAGR ( AUM +11% ) • Customers loans +12% “

  21. 2 0 0 4 - 0 5 T A R G E T S U P D A T E

  22. Macroeconomic scenario 2003 2004 2005 GDP0.5% 1.6% 2.3% Old* 1.4% 2.6% 2.5% Domestic demand1.3% 2.1% 2.9% Old* 2.0% 2.5% 2.5% Disposable income1.3% 1.8% 2.3% Old* 1.4% 2.0% 2.2% Lending 6.3% 6.5% 6.2% Old* 5.4% 6.2% 6.1% Lending rate (avg.)5.0% 4.7% 4.8% Old* 5.3% 5.6% 5.9% Direct funding4.3% 4.4% 4.3% Old* 4.7% 5.1% 5.1% Source: Prometeia, December 2003 - * Figures underlying 2003-05 Business Plan

  23. Cost breakdown update 2002 PF 2005Change - New Change - Old FINDOMESTIC CAGR CAGRExcluded - CAGR TOTAL COSTS 722.4 780.0 + 2.6%+3.2 %+0.8 % Personnel expenses 407.8 428.0 + 1.6% + 1.4 %+ 0.5 % Other costs 246.5 284.0 + 4.8% + 5.7 %+ 2.1 % Depreciation 68.1 68.0 FLAT + 5.0 %- 1.3 % € million

  24. Without CR Spezia With CR Spezia* New Old EPS and Cost/Income Cost/Income EPS * EPS takes into account the capital increase connected to the acquisition

  25. F I N D O M E S T I C B A N C A C O N S U M E R C R E D I T

  26. 2003 LEADING FINANCIAL COMPANIES Udine FINDOMESTIC 4.6 FIATSAVA 3.0 AGOS ITAFINCO 2.7 DEUTSCHE BANK 2.4 FIDITALIA 1.8 GR. FINEMIRO 1.7 BIPIELLE DUCATO 1.6 FINCONSUMO 1.4 Milano Padova Verona Torino Bologna Genova Firenze Ancona Perugia Pescara Roma Sassari Bari Napoli Lecce Salerno Cagliari Cosenza € billion Reggio C. Palermo Catania Main figures Net income 90.6 (+45%) (euro mn) ROE 25.7% Market share 13.4% S&P ratings Long term A+ (1 notch up) Short term A1 (positive outlook) 2003 results at a glance

  27. NPLs ratio Italian GDP annual increase Volumes and credit quality 2003 / 2002 +16.4% Euro mn New business 2002 2003

  28. Market Findomestic Personal loans - Volumes Cards - Transactions Cards - Volumes Findomestic DB Findomestic Findomestic BPL Agos Cartasi Agos Cartasi BPL Agos DB Growth comparison 2003 New business growth € million € million /000,000

  29. € mn 0 % - CAGR 2002 2003 E Total outstanding Consumer credit Durable goods consumption The Italian market: recent developments Source: ASSOFIN and Prometeia

  30. 2002E 2012E CAGR V O L U M E S Absolute change 1 Germany Personal loans 113,2 Germany Revolving credit 181,6 Germany Revolving credit 158,6 2 UK Personal loans 107,4 UK Revolving credit 150,9 France Revolving credit 112,2 3 Germany Motor finance 86,9 UK Personal loans 145,9 Italy Personal loans 31% 102,8 4 Spain Personal loans 80,6 France Revolving credit 136,1 Italy Revolving credit 101,4 26% 5 UK Revolving credit 72,7 Germany Motor finance 122,8 UK Revolving credit 78,2 Italy Revolving credit 113,1 6 France Personal loans 48,1 France Personal loans 63,5 7 UK Motor finance 43,5 France Personal loans 111,7 Spain Revolving credit 39,6 Italy Personal loans 109,9 8 France Revolving credit 23,8 UK Personal loans 38,5 9 Germany Revolving credit 23,0 Spain Personal loans 99,5 Germany Motor finance 35,8 10 France Motor finance 22,7 Germany Personal loans 84,2 Spain Personal loans 18,8 11 Italy Motor finance 21,8 UK Motor finance 62,1 UK Motor finance 18,6 12 UK Other balances 18,1 Spain Revolving credit 49,5 Italy Motor finance 12,7 13 Spain Motor finance 17,7 Italy Motor finance 34,5 UK Other balances 11,6 Italy Revolving credit 11,6 14 France Motor finance 31,4 Spain Motor finance 9,2 15 Spain Revolving credit 9,8 UK Other balances 29,8 France Motor finance 8,7 16 France Other balances 8,8 Spain Motor finance 27,0 France Other balances 3,5 Italy Personal loans 7,1 17 France Other balances 12,4 Spain Other balances 2,9 18 Spain Other balances 4,4 Spain Other balances 7,4 Germany Other balances 0.5 19 Germany Other balances 1,0 Germany Other balances 1,5 Germany Personal loans - 28,9 (€ billion) A prospective outlook Source: Goldman Sachs - 2003, October

  31. B A C K - U P

  32. CR della Spezia - The deal Stake Euro mn PBV x Banca INTESA29.87% 69.0 1.44 CR Spezia Foundation 38.22% 162.2 2.67 Carinord2 fanout costs 6.7 TOTAL 68.09% 237.9 2.20 Dedicated capital increase mispricing -19.3 TOTAL 68.09% 218.6 2.02 Put option 31.9% 58.3 1.15 TOTAL 100.00% 276.9 1.74

  33. 2003 LEADING ASSET GATHERERS* Sanpaolo IMI 5,615 BPU 2,920 ANIMA 2,231 BANCA CR FIRENZE 1,632 CREDEM 1,491 MPS 1,449 B. LOMBARDA 1,333 POSTE ITALIANE 1,288 Euro mn AUM market share**(ex insurance products) Insurance product market share** Asset under management * Net inflows, source: Assogestioni ** Business territory, source: Prometeia Dec. 2003

  34. Consumer credit - Market comparison 2002 - Consumer credit / G.D.P. 2002 - Consumer credit / Household consumption

  35. Electronics Credit cards Personal loans Furniture New vehicles Household consumption Consumer credit - Low price sensitivity Source: ASSOFIN and Prometeia. 1Q ’98 household consumption=100

  36. Perseo Finance: NPLs securitisation • One of the best performer since the enactment of the Italian “Securitisation Law” (1999)

  37. CR Firenze Mutui: mortgage loans securitisation • Euro 521 million of “in bonis” residential mortgage loans: no value adjustment required so far Underwriting Rating Face amount/ Class Yield price Fitch/Moody's/S&P million A1 51.3 Euribor 3 m + 19 bp 100 AAA / Aaa / AAA A2 425.6 Euribor 3 m + 28 bp 100 AAA / Aaa / AAA B 28.2 Euribor 3 m + 75 bp 100 A / A2 / A C 7.7 Euribor 3 m + 145 bp 100 BBB / Bbb / BBB BCRF portfolio D 8.2 Floating 100 ----

  38. 2 0 0 3 R E S U L T S 2 0 0 4 - 0 5 T A R G E T S U P D A T E M a r c h 3 1, 2 0 0 4

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