Solid year for KAS BANK Strengthening core business. Analyst meeting

Transcription

1 Solid year for KAS BANK Strengthening core business Analyst meeting Amsterdam, 25 February

2 New Managing Board Introduction Sikko van Katwijk Chairman Managing Board Jaap Witteveen Chief Operating Officer Mark Stoffels Chief Financial & Risk Officer Corporate Commercial Department Treasury Internal Audit UK & German Branches Operations IT HR & BS Finance Risk Compliance KAS Trust 2

3 Our priorities for KAS BANK Create value for clients, shareholders and other stakeholders 1. Enhance business model: increase profitability 2. Strengthen product portfolio; partnerships: grow top-line 3. Leverage size/agility; become more Lean: lower cost & increase efficiency 3

4 Solid year for KAS BANK, strengthening core business Continued growth of core business all institutional segments contributing to top line with higher gross income numbers. Pensions and insurance segments gross income increased by > 15%. Transaction Banking remains a solid base and contributor; resulting in significant improvement of operational results (+18%) up to EUR 15.4 million with solid contributions across the board. Total net result of EUR 15.3 million (2014: EUR 24.3 million); solidifying our capital ratios which remains stable at an average of 20%; allowing us to maintain our attractive dividend payout proposing EUR 0.64 per share; And securing that we keep our long-term strategic initiatives on track Increased productivity of operations Clear focus strategy leads to client driven product solutions 4

5 Program today 5 topics 1 KAS BANK s strategy 2 Our financial performance 3 Operational Excellence 4 Outlook 2016 by Sikko van Katwijk by Mark Stoffels by Jaap Witteveen by Sikko van Katwijk 5 Your questions 5

6 KAS BANK s Strategy Becoming a prominent securities specialist for Institutional Investors now 2020 Grow in German & UK markets Maintain low risk profile Launch partnerships Grow top-line Become more efficient Lean and lower costs Develop staff base Strengthen capital base Extend product range Enhance customer experience 6

7 Program today 5 topics 1 KAS BANK s strategy 2 Our financial performance 3 Operational Excellence 4 Outlook 2016 by Sikko van Katwijk by Mark Stoffels by Jaap Witteveen by Sikko van Katwijk 5 Your questions 7

8 Results Satisfactory growth in result from operations m 2015 ى 2014 Operating income % Operating expenses % Tax expense % -4.0 Net result from operations % 13.0 Impairments Resolution levy and contribution to resolution funds Result of sale Lehman claim Received compensation dwpbank Expenses related to announced investment plan Tax expense Net result other Net result for the period %

9 Comprehensive income Pension volatility in equity removed m Net result for the period Revaluation Available for Sale portfolio Revaluation land and buildings Actuarial gains/losses on pension ,5 Net total comprehensive income Highlights: Pensions: transfer from DB-scheme to CDC-scheme Revaluation land and buildings based on own use 9

10 Financial targets Satisfactory progress with work to do Target Leverage income versus cost* ق 3% 2% 6% Efficiency ratio* 70% - 77% 82% 84% Return on Equity* 10-year +5-8% 8% 6% Growth in earnings per share* > 8% 18% 44% Dividend pay-out 60-80% 62% 39% Average capital ratio ق 16% 20% 24% *based on result from operations 10

11 Operating income Increase of recurring operating income, mainly client driven m 2015 ى 2014 Operating income % Interest % 25.4 Commission income % 65.3 Trading/investments client driven % 10.9 Trading/investments own portfolio % 1.3 Other % 1.3 Other items Total operating income %

12 Commission income Growth in all commission income categories m 2015 ى 2014 Commission income % 65.3 Asset Servicing Client wins and higher asset base (custody, accounting, trust) Increase of regulatory services (AIFMD, FTK) Transaction Servicing Higher transaction volumes Fee pressure Treasury Increase of securities lending volumes Higher demand to order execution and collateral management % % %

13 Operating expenses Challenges due to investments and pension m 2015 ى 2014 Operating expenses % 87.2 Personnel % 57.4 IT expenses % 15.1 Other expenses % 10.7 Depreciation % 4.0 Other items Total operating expenses %

14 Capital and liquidity Capital and liquidity levels remain strong, m Capital ratio (as per year-end) 24% 22% Common equity tier 1 (as per year-end) Risk weighted assets (as per year-end) Liquidity Coverage Ratio 143% n/a m 2015 Equity as per 1 January 194 Revaluation reserve (AFS, own building) 10 Profit / (interim) dividend 6 Equity as per 31 December

15 Dividend yield KAS BANK Strong returns for shareholders Dividend Yield year end price 4.5% 5.2% 6.2% 5.8% 8.5% 6.6% 6.5% 6.0% Yield average price 2.1% 6.4% 5.9% 4.9% 8.3% 6.8% 6.4% 5.8% 15

16 Financial wrap-up Positive developments, focus on cost reductions Positive development in recurring operating income Disappointed expense level Remaining high capital and liquidity ratios, increasing equity position Strong return for shareholders 16

17 Program today 5 topics 1 KAS BANK s strategy 2 Our financial performance 3 Operational Excellence 4 Outlook 2016 by Sikko van Katwijk by Mark Stoffels by Jaap Witteveen by Sikko van Katwijk 5 Your questions 17

18 Operational Excellence Strategic initiatives in progress A successful implementation with Lean Six Sigma: 1 st pilot completed in Q The second wave of improvement projects started in Q1 2016; Improving the administration platform: successfully completed 1 st phase of process improvement project and on track to complete 2 nd phase in Q (optimize use of platform, by replacing third party software solutions with integrated modules); IT: investigation for outsourcing opportunities completed in Q4, RFP sent to three vendors in Q1 2016; The building: investigation started to review opportunities for current KAS BANK head office building in Amsterdam; Partnerships: researching the rationalization of the operational infrastructure and the optimization of the network, product extension and quality improvement; 18

19 Program today 5 topics 1 KAS BANK s strategy 2 Our financial performance 3 Operational Excellence 4 Outlook 2016 by Sikko van Katwijk by Mark Stoffels by Jaap Witteveen by Sikko van Katwijk 5 Your questions 19

20 Outlook 2016 KAS BANK expects that the financial markets in general and for our clients in particular will remain to be uncertain which means market conditions are expected to remain extremely challenging. As we expect a continued, sustainable growth of the business and strategic initiatives to contribute to the improvement of the bank s efficiency, we reconfirm the long term objectives. KAS BANK will continue to invest in its core business, efficiency and customer experience to follow the strategic path to

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