apimec meetings banco do brasil · 2018. 9. 18. · this presentation may include references and...
TRANSCRIPT
APIMEC MeetingsBANCO DO BRASIL 2018
Rio de Janeiro
This presentation may include references andstatements, planned synergies, estimates, projections ofresults, and future strategy for Banco do Brasil, itsAssociated and Affiliated Companies, and Subsidiaries.Although these references and statements reflect themanagement’s belief, they also involve estimates andunforeseen risks. Consequently, results may differ fromthose anticipated and discussed here. Theseexpectations are highly dependent on market conditions,on Brazil’s economic and banking system performances,as well as on international market conditions. Banco doBrasil is not responsible for updating any estimate in thispresentation.
Disclaimer
Index
Profile 4
BB in Rio de Janeiro 5
Ownership structure and Value Generation 6
BBAS3 7
Corporate Governance 8
Strategy and Results 9
BB’s Lending Process 10
Individuals Organic Classified Loan Portfolio 11
Very Small and Small Companies Support 12
Capital Markets 13
Agribusiness 14
Asset Quality 15
CET 1 Evolution 16
Guidance 2018 17
#maisquedigital 18
Investment in IT 19
Digital Customers 20
Digital Strategy Evolution 21
Socioenvironmental Responsibility Governance 22
Green Economy 23
Environment Value Creation 24
Taking care of what matters to people 25
Profile
Business diversification including:
Banking
Services
Insurance Capital
Markets
Payment of
Methods
International
Franchise
Asset
Management
SolidFinancialPerformance
MarketLeaderships
FundingStable and diversified
Established in 1808
4
(1) It includes retail branches, companies, specialized small and very small companies and Government
(2) It includes Banking Agents, Postal Bank Branches, and kiosks
253 Branches¹
11 Empresa Branches
31 Estilo Branches
14 Offices
2 Estilo
12 Exclusivo
290 Other points of service²
1s
tB
B B
ran
ch
in
1808
CCBB: Opening in 1989BB in Rio de Janeiro
In the 100 cultural institutions
most visited in the world 2017³
Rio de Janeiro is the most
Digital place
Mondrian e o movimento de Stijl – was
the 6th most visited exhibit on the Planet
(3) According to The Art Newspaper. 5
(1) Dividendos e JCP 12 meses / Capitalização de Mercado.
6
R$ 1.8 Bi47.8%
52.2%
23.0%
24.8%
Free Float
Federal
Government
Foreign Capital
Domestic Capital
Total Shares (–) Shares Owned by the Company
2,785,235,449
Ownership structure and Value Generation
(1) Dividends and Interest on own Capital 12 months / Market Capitalization.
4.4%¹
Dividend yield in the 1H18
1st company listed on the stock exchange in Brazil
For the firsthalf of 2018, itwill be distributed
In interest on own capital
6
15.03
27.51
14.45
42.68
48,964
75,429
30000.0
40000.0
50000.0
60000.0
70000.0
80000.0
90000.0
100000.0
110000.0
120000.0
14.0
19.0
24.0
29.0
34.0
39.0
44.0
30
.ma
i.1
6
30
.ju
n.1
6
31
.ju
l.16
31
.ag
o.1
6
01
.ou
t.16
01
.no
v.1
6
02
.dez.1
6
02
.ja
n.1
7
02
.fev
.17
05
.ma
r.17
05
.ab
r.17
06
.ma
i.1
7
06
.ju
n.1
7
07
.ju
l.17
07
.ag
o.1
7
07
.set.
17
08
.ou
t.17
08
.no
v.1
7
09
.dez.1
7
09
.ja
n.1
8
09
.fev
.18
12
.ma
r.18
12
.ab
r.18
13
.ma
i.1
8
13
.ju
n.1
8
14
.ju
l.18
14
.ag
o.1
8
14
.set.
18
BBAS3 BBAS3 Minimum BBAS3 Maximum Ibovespa
At R$ 27.51 BBAS3 appreciated 83,0% while Ibovespa grew by 54.1%
BBAS3 – Adjusted Closing Price from May 30th, to Sep 14th, 2018. Past performance is no guarantee of future returns. This information is based on Economatica data.
Points
IBOVBBAS3 Price
(R$)
09.m
ar.
18
7
Corporate Governance
Recent Improvements
Appointment and
succession policy
Compensation and
Eligibility Committee
Risk and Capital Committee
Segregationof Responsibilities
Risk
ManagementModel of
Defense lines
Structure of committees
3 Advisory Committees
of the Board of Directors
14 Executive Committees
and 1 Superior Committee
DECISION MAKING
PROCESS
Collegiate
Decision
8
Strategy and Results
9.2%12.8% 13.8%
Market
Profitability Growth
Adjusted Net Income(R$ billion)
1.80 2.65 3.24
2Q16 2Q17 2Q18
+1.2%Administrative
Expenses
(1H18/1H17)
EFFICIENCY
Improvement
-29.0% ALLL
(1H18/1H17)
Operational and
Credit Losses
REDUCTION
CET 1Target
11% in Jan/22
CAPITAL
Adequacy
ROE
+5.5% Fee Income
(1H18/1H17)
Driven by
Checking
Account (+7.2%)
and Asset
Management (+13.2%) 9
43.7
188.6
189.8
263.4
685.5
Jun/18
44.9
188.2
185.9
277.2
696.1
Jun/17
Abroad
Agribusiness
Individuals
Companies
Loan Portfolio Expanded View
Credit
qualityImprovement
ALLL
ReductionDisbursements
Increase
BB’s Lending Process
Client Risk
External Information
Internal Information
SCR
Behavioral
Customer File
Information
Customer
Limit Value
Risk
ApprovalLevels
CreditLimits
Income/Revenue
Risk / Portfolio
Guarantees 10
36.3%
24.7%10.1%
26.6%
Individuals Organic Classified Loan Portfolio
Auto Loans2.3%
22.2%Market Share
Jun/18
Consolidated with
BB2018 Target: To reach R$ 2 bi in disbursements
1H18: 56% of transactions
contracted through mobile
Other
Payroll
Mortgage
Salary Loans
R$ 1.5 bi disbursed through
mobile since launch until Jun/18
Increase of
Credit Lines
Participations
with better
risk-adjust
return.
11
Very Small and Small Companies Support
Working Capital/Receivables
Foreign Trade
Investment
65.2%
32.4%34.3%
Jun/17
64.2%
1.5%57.4
40.72.4%
Jun/18
R$ billion
(1) It does not include credit card, overdraft account and revolving working capital transactions.
Portfolio breakdown
Disbursements¹
Shorter Maturities
Receivables and Working Capital
Guarantees
168 Empresa
branches and
1.1 thousand branches provide
managed services
More than 2.2 million customers
685 thousand costumers with access
to specialized services
7,000 Dedicated EmployeesManagers and Business Assistants
Specialized Service
Increase of 7% on/2T17
Increase of 16% on/1T1812
Ranking ANBIMA
3rd
Jun/18
39 Fixed Income
Transactions
15% Market
Share
9 Foreign
Issues
49% Market
Share
2nd
DomesticFixed Income
Consolidated Origination
Domestic Fixed Income
Consolidated Distribution
Capital Markets
Capital Market Fees
R$ 415 milionon 1H18
+18.9% over 1H17
1H18
2ndInternationalFixed Income
Private Issues
RELEVANCE
PROTAGONISM
Financial desintermediation |
50.3% of the originated volume was
distributed to the market
Ready to act
in lower interest rate environment
R$ 24.4 bi
Present in 31% of the total
funding captured by companies
13
(1) Source: Brazilian Central Bank.
Agribusiness
Best in Class
59.7 %Market Share Jun/18¹
14.9%
15.5%
69.6%
R$ 80.4 bi
Harvest 17/18
16.6%
18.6%
64.9%
R$ 72.3 bi
Harvest 16/17
Harvest Disbursements2017/2018
Medium Size Producers - Pronamp
Small Agriculture - Pronaf
Companies
BB provides R$ 103
billion for the Harvest
2018/19An increase in Disbursements of
21% over the 2017/18 Harvest
14
143.3%
166.2%
4.18%
Jun/17
3.57%
Jun/18
Coverage Ratio
Asset Quality
NPL+90 days Cost of Risk
3.34%
Jun/18
4.11%
Jun/17
7.35%
3.33%
Companies 5.20%
3.34%Individuals
Agribusiness1.61%
1.39%15
40% in 2018
CET 1Evolution
Jun/17
Jun/18
9.18
9.61
New Payout
Between
30% to 40%
CET 1 Target:
Minimum of 11% in January 2022 16
Adjusted Net Income - R$ billion
Net Interest Income - %
Organic Domestic Loan Portfolio – Expanded View %
Individuals- %
Companies - %
Agribusiness - %
ALLL Expenses net of recovery of write-offs - R$ billion
Fee Income - %
Administrative Expenses - %
11.5 a 14
-5 a 0
1 a 4
4 a 7
-3 a 0
4 a 7
-16 a -14
4 a 7
1 a 4
6.3
-8.1
-1.0
4.0
-7.0
5.1
-7.8
5.5
1.2
Guidance
2018
1H18
Performance
Revised¹
(1) Guidance revised. Previous range between R$ -19 a -16 bilion.
Guidance 2018
17
Improving customer experience
Co
mp
an
ies
Ind
ivid
ua
ls
Relationship
Manager
Branch
Manager
Digital
Relationship
From 10am
to 4pm
Specialized Advisory
Human Solutions Digital Solutions
Telephone E-mail
Chat /
messages
Videoconference
Documents
Electronic
Exchange
Double
Confirmation
#maisquedigital
From 8am
to 10pm
From 10am
to 4pm
From 8am
to 6pm
18
(1) POS, Agents in country and CABB
TRANSACTIONS
18.2%
26.6%
36.8%
12.1%
4.5%
22.8%19.8%
13.9%
Jun/16
48.8%
Jun/17
13.2%
3.1%
57.2%
10.1%
2.5%
10.4%
Jun/18
Mobile Others¹
Internet
TAA
Branches
Investment in IT
From 2012 to 2018 was invested in IT
R$ 19.8 billion
3.22.8
3.43.0
3.13.1 1.4
20132012 20152014 2016 2017 1H18 Total
19.8
Taking the bank toTHE CUSTOMER
19
(1) Customers who started the relationship with Banco do Brasil through digital channels, from
Nov/2016 to July 31, 2018.
2.2 million native digital¹
Target 2018: Reach 3.35 mi native digital customers
Digital Customers New PlataformCredit Card Order
6.000 Orders/Day
International Credit
Card which may have
100% annuity
exemption.
Target Costumer:
non checking account holders
in general; savings accounts
holders and other
costumers that do not have
a checking account with
BB; costumers that do not
use the benefits of a
traditional rewards program.
100% digital
customers
20
(1) Individuals Services in Estilo Branches and Exclusivo and Estilo Offices.
Digital Services¹(number of individuals customers,
branches and offices)
Credit Managerial Result
by service type in 2018
31%
25%11%
9%
24%
149.0
Jun/18Jun/16 Jun/17
398.0
292.0
OfficesTraditional Branches
Digital Branches Mobile & Internet
ATM
69%
Individuals Credit² Channels Distribution
37.0%
63.0%
1H18
Branches Digital Channels
Contracted Volume
(2) It does not included credit card and mortgages transactions
6041,796
3,589
Digital Customer (thousand)Digital Branches
21
Digital Strategy Evolution
For us in Banco do Brasil, socio-
environmental responsibility means
“to have Ethics as our commitment
and Respect as our attitude in our
interactions with employees,
stakeholders, suppliers, partners,
customers, creditors, shareholders,
competitors, community,
government and the environment.”
A forum that gathers executives from
BB and Fundação Banco do Brasil
aiming to support the process of
incorporations, alignment and
dissemination of the principles and
practices of Sustainability of BB; and to
accompany the socio-environmental
initiatives and the implementation of the
actions set forth in Agenda 30 BB.
Sustainability Forum
Strategic unit directly linked to the Presidency of BB and responsible for conducting
the corporate socio-environmental responsibility
theme.
Strategy and Organization (Direo)
Biannually: to aprove BB’s Sustainability Plan.
Semiannually: to track the execution off BB’s Sustainability Plan.
>> On demand: to approve, within its competence, proposals to improve of
BB’s socio-environmental performance.
Board ofDirectors
Annually: to monitor BB’s socio-environmental performance and the
initiatives in progress.
>> On demand: to approve, within its competence, proposals to
improve of BB’s socio-environmental performance.
Board of Directors
Approved by the Board of Directors in 2017, with the
purpose of advising this Board in the performance of its functions related to risk
management, including socio-environmental risk and capital.
Risk and Capital Committee
Socioenvironmental Responsibility Governance in BB
22
Investments and loans for
renewable energy
Sustainable Construction
Energy Efficiency
Sustainable Transportation
Water, fishing, woods, sustainable
agriculture and waste management.
Sustainable Tourism
R$ 1.4 billion resources allocated
in assets with socio-environmental
lineament.
Green EconomyR$ 193 bilion of our operations are in
Green Business, which represents
32.4% of our Loan Portfolio.
32.4%
Internal Classified
Loan Portfolio
Green Business
23
Conscious use of Water (Purágua)
Energy use awareness
Cartridge and toner reconditioning (Prorec) and Paper Consumption
24
201710.3% of total water consumption
reduction. Reduction of 47%
between 2013 and 2017.
Economy of 95.5 million kWh enough for
50 thousand residences in the year.
105 Thousand cartridge
reconditioning (98% of total)
Digital Strategy contributed to reduce
in 628 tons the paper consumption.
(The same as 13,3 thousand trees
uncut)
Environment Value Creation
24
(1) It includes Government remuneration and interests over Hybrid Instrument in Brazil.
In the first half of
2018, we created R$
22 billion contributing for our
society development
and favoring the
Brazilian economy.
Taking care of what matters to people
Employees
Minority Interests
Rental
Taxes
Reinvestments
The payment and
benefits of our
employees totaled
R$ 9.8 billion Were payed R$ 4.9 billion in
federal, state e municipal
taxes
R$ 669 million was the
value payed in real state
rentals, supporting our
attendance in the whole
country
R$ 877 million distributed
to the minority shareholderWere retained R$ 4.8
billion, strengthening
our capital
Shareholders¹R$ 1.0 billion distributed to
the majority shareholder
4.6%
44.6%22.1%
3.0%
21.7%4.0%
R$ 22 billion
25
+55 (11) 4298-8000Av. Paulista, 1230
18º floor
Bela Vista
São Paulo - SP
Brazil
Zip Code 01310-100
www.bb.com.br/[email protected]