BANK HANDLOWY W WARSZAWIE S.A. 2Q 2011 consolidated financial results. August 2011

Transcription

1 BANK HANDLOWY W WARSZAWIE S.A. 2Q 2011 consolidated financial results August 2011

2 Second quarter of 2011 summary Revenue () % 576 Corporate demand deposits (PLN B) % 5.7 Elite credit card - MasterCard World Signia Ultime Improvement of quality perceived by customers 2011 goal 80% ROE 12.8% 12.8% 0,0 pp. Retail demand deposits (PLN B) % 2.0 The first Payment Travel Card in Wrocław NPS ratios in 2Q 2011 significantly above financial sector benchmark (30%) 69.2% 60.9% The first Payment Travel Card in the Tri-city 45.7% 39.7% Corporate loans (PLN B) Number of customer touchpoints 30% % 7.1 1,614 1,757 Oddział Citigold CitiPhone CitiService Opening of the first R&D Center in the Polish banking sector 2

3 // 360 EFFICIENCY Net profit 1H 2011 vs. 1H NET PROFIT 1H % Net interest income Interests Fees Treasury Other revenue Expenses Net impairment losses 7% Net fee and commission income 34% Treasury 6% Expenses & depreciation Tax NET PROFIT 1H % Net impairment losses 3

4 // 200 EFFICIENCY Net profit 2Q 2011 vs. 1Q NET PROFIT 1Q % Net interest income Interests Fees Treasury Other revenue Expenses Net impairment losses 1% Net fee and commission income 35% Treasury 6% Expenses & depreciation Tax NET PROFIT 2Q % Net impairment losses 4

5 Interest margin under pressure Financial sector Interest income () % 470 Still one of the highest margins in the sector 4.6% Debt securities % % 4.0% Credit cards % Cash loans % 126 Corporate loans % 66 2Q10 1Q11 2Q % 348 Interest expenses () Other % 122 Financial sector Q Q Q 2011 Corporate deposits Net interest income Margin on average interest assets Retail deposits % 30 2Q10 1Q11 2Q11 5

6 Loans corporate banking volumes still in the upward trend Corporate loans 7,089 5,993 5% Sector: -2% 6,272 13% Sector: 8% 13% Significant growth of corporate loans in 1H 2011 Growth beating the sector dynamics 2Q10 4Q10 2Q11 Retail loans 5,490 5,322-3% Sector: 5% -4% Sector: 4% 5,118 4% Decrease of retail loans More stringent credit policy criteria (implementation of T Recommendation) 35% Increase of mortgage loans balance to PLN 431 MM 2Q10 4Q10 2Q11 Growth in the sector: +8% 6

7 Deposits focus on operating accounts Corporate deposits 14,907 9,269-23% 35% 14,688 7,097-11% -25% 12,059 6,328 25% Drop of demand deposits in 1H 2011, however there was a growth as compared to 2Q ,638 7,592 5,731 Seasonal decrease, in line with market trend (-4%) 2Q Q Q 2011 Retail deposits 6,246 4,503 1,744-14% 6% 5,718 5,699-5% 3,876 3,683 9% 1,842 2,016 9% Growth of demand deposits in 1H 2011 Effect of focus on operating accounts Growth beating the sector dynamics (+5%) 2Q Q Q 2011 Demand deposits Time deposits 7

8 Stable net fee and commission income Net fee and commission income 1% 44% (2Q 2011/ 2Q 2010) Brokerage DMBH market share: 10% Value of equity turnover Market position # % (2Q 2011/ 2Q 2010) Custody services # 1 Citi Handlowy market share: 41% Value of assets under custody 2Q Q Q 2011 Key transactions of 2Q 2011 Initial Public Offering PLN 5.37 B Syndicated loan EUR 2.6 B 2% (2Q 2011/ 2Q 2010) Credit and payment cards Citi Handlowy market share 1 : 22% Value of transactions 1 Data for 1Q 2011 # 1 Sales of cards higher by 50% than average sales in 4 recent quarters 8

9 Breakdown of net fee and commission income Credit cards retail sales Net fee & commission income Investment products sales 1, % 1,491.0 Insurance and investment products 20% Cards 30% Payment orders 17% % Credit cards international sales % Other 3% Cash management 4% Brokerage services 11% Cash loans 2% Custody services 13% Assets under custody % PLN B 9

10 Treasury Income from Treasury () Income on customer activity Leading position on the FX market #1 In the category of FX trading with corporate clients according to the ranking published by Euromoney +24% YoY growth in the volume of FX transactions with corporate clients CitiFX Pulse third generation platform 2Q10 1Q11 2Q11 Proprietary management 75% share of online transactions in total FX transactions concluded through the platform Order transactions Citi Handlowy was the first bank on the market that offered possibility to place currency buy or currency sell order under the specified FX rate 2Q10 1Q11 2Q11 Pro forma data, scales on charts are not comparable 10

11 Growth of expenses as a result of expansion of business General administrative expenses and depreciation % Depreciation 5% YoY Administrative expenses Increase of expenses in 2Q 2011: Increase mainly in retail banking as an effect of: Staff expenses higher costs of sales agencies following increased acquisition of credit cards, 2Q Q Q 2011 Cost / Income 2Q10 1Q11 2Q11 Change (QoQ) higher spending on marketing and advertising (campaign promoting operating accounts and credit cards - Citibank MasterCard World and Travel Payment Cards). Corporate Banking 42% 45% 54% - Retail Banking 62% 72% 74% Bank 51% 57% 64% 11

12 Decrease of credit risk costs // Net impairment losses 11.9% Loan portfolio quality 11.2% 11.3% (140) (110) (80) (50) (20) 10 Corporate Banking Retail Banking (88.8) 3.1% (41.9) (15.4) 2Q10 1Q11 2Q11 Corporate Banking Net impairment losses () 2Q10 (10.7) (78.1) Retail Banking 1Q11 (12.3) (29.6) 2Q (28.9) 0.5% Cost of risk (%) Change YoY /PLN billion/ NPL ratio Corporate Banking Retail Banking Non-banking sector Q10 1Q11 2Q11 Non-performing loans Performing loans NPL ratio 2Q % 11.6% 11.9% 1Q11 9.8% 13.9% 11.2% 2Q11 9.2% 14.5% 11.3% Change YoY Retail Banking: Further decline of net impairment losses coupled with slower growth of impaired loans Corporate Banking: Improvement of loan portfolio quality along with drop of net impairment losses thanks to stabilization of customers financial standing 12

13 Citi Handlowy s priorities for Priorities Volumes focus on growth of loans (corporate double digit increase; retail double digit increase propped up by mortgage loans and credit cards) Operating account: increase in the number of operating accounts (both retail and corporate) 1H execution Loans to non-financial sector (PLN B) corporate +13% +5% mortgage +35% credit cards -4% 4Q Q thousand credit cards acquired in 1H 2011 Operating accounts of customers (in thousands) % corporate +1% retail +19% 4Q Q thousand retail accounts acquired in 1H H plans Volumes - corporate further growth - retail higher sales of credit cards 50 thousand cards to be acquired in 2H 2011 Operating account: - 43 thousand retail accounts to be acquired in 2H corporate accounts to be acquired in 2H 2011 Investment Banking: participation in key transaction on the capital market Initial Public Offering Initial Public Offering Public call for sales of shares Investment Banking: participation in a few public offerings and M&A transactions PLN 0.3 B PLN 5.37 B PLN 15.9 B Innovations: 10% increase of gross income from innovations Quality: 80% of customers will notice a positive change 13

14 Appendix

15 Retail banking operational data (in thousands) 2Q Q Q 2011 change YoY % change YoY Current accounts including: % Operational accounts % Saving accounts % Credit cards including: (79) (8%) co-brand cards (58) (11%) Debit cards including: % PayPass cards % 15

16 Retail banking volumes (PLN million) 1Q Q 2011 change QoQ % change QoQ Deposits 5,855 5,699 (156) (3%) demand deposits including: 4,460 4, % volumes on savings accounts 2,531 2,461 (70) (3%) time deposits 1,395 1,195 (200) (14%) Loans 5,133 5,118 (15) (0%) credit cards 2,248 2, % cash loans 2,425 2,323 (102) (4%) mortgage loans % 16