banca finnat euramerica financial results as of 30.06.2015 ... · banca finnat euramerica financial...

Banca Finnat Euramerica Financial Results as of 30.06.2015 Business Plan 2015 - 2017

Milan, 15.09.2015

2.

Agenda

I The Group's Profile

II Business trends

III Financial Results as of 30.06.2015

IV Strategic guidelines

V Group's Business Plan 2015 – 2017

3.

Banca Finnat Euramerica S.p.A.

InvestiRE SGR S.p.A. Finnat Fiduciaria S.p.A.

Fedra Fiduciaria S.p.A. Finnat Gestioni S.A.

50.16%

70%

100%

100%

The Banca Finnat Group

Previra Invest SIM S.p.A.

Revalo S.p.A.

36% 20%

Imprebanca S.p.A.

25% 20%

Sigefi Italia Private Equity S.p.A.

4.

Agenda


II Business trends




16.1% Interest margin

8.4% Proprietary Trading Activities

5.7% Dividends

69.8% Net Commissions

Revenues (earnings margin) breakdown

5.

Revenues (€/000) 30-giu-14 30-giu-15 Var %Interest Margin 7,007 4,995 -28.7%

Net Commissions 11,153 21,591 93.6%

Dividends 1,558 1,766 13.4%

Proprietary Trading Activities 1,566 2,585 65.1%

4.2 % Trust Services

21.7 % Private Customers

43.1 % Real Estate Funds

1.3 % Advisory & Corporate Finance

7.5 % Institutional Customers

22.2 % Proprietary Trading

Business Segment Revenues

6.

7.

16% Corporate Customers

12% Financial Intermediary Customers

72% Private Customers

Banking activity broken down by customer type

4% 4% 3% 3%

37% 41% 43% 35%

17%16% 14% 11%

42%39% 40%

51%9,0919,875 10,278

13,243

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

31-dic-12 31-dic-13 31-dic-14 30-giu-15

8.

Total Assets Under Management (€/M)

CAGR: 13.4%

Real Estate Funds Trust activity Indirect deposits Direct customer deposits

9.

* Including delegated management

3.0% Direct customer deposits

40.2% Administered and Trust accounts

51.2% Real Estate Funds

5.4% Managed portfolios

0.2% Third party insurance products

Total AUM breakdown and performance

AUM Breakdown (€/000) 31-dic-14 30-giu-15 Var %

Direct customer deposits 336,854 402,681 19.5%

Administered and Trust accounts 5,107,552 5,321,923 4.2%

Managed portfolios * 671,942 711,667 5.9%

Third party insurance products 30,597 32,448 6.0%

Real Estate Funds 4,130,632 6,773,977 64.0%

10.

Real Estate Asset Management Companies – Asset Ranking

Assets managed as at 31.12.2014 (Euro billions)

Source: Assogestioni – Half-yearly report on Italian real estate funds 2nd half of 2014

(1) Investire Immobiliare pro forma post merger figures.

Market share

9,0

7,1

5,5 5,4

3,4 3,22,4

1,5 1,4 1,40,9 0,8 0,7 0,7 0,5 0,5 0,5 0,5 0,5 0,4 0,1

19,3% 15,2% 11,9% 11,7% 7,3% 7,0% 5,2% 3,2% 3,0% 3,0% 1,8% 1,8% 1,5% 1,4% 1,2% 1,2% 1,1% 1,1% 1,1% 0,9% 0,3%

0 ,0 %

2 ,0 %

4 ,0 %

6 ,0 %

8 ,0 %

1 0, 0%

1 2, 0%

1 4, 0%

1 6, 0%

1 8, 0%

2 0, 0%

0

1

2

3

4

5

6

7

8

9

10

11

12

11.

Post merger Real Estate Asset Management Company – Highlights

Assets managed (proforma data 2014) (1)

(1) Asset management mandates not included (Euro 360M in 2014).

3.913

1.944

1.218

0

1.000

2.000

3.000

4.000

5.000

6.000

7.000

8.000

31.12.2014

Masse (Euro M)

Development & Social Housing

Specialistic Market

Long Term & Residential

7.074

Total 32 funds

49%

6% 2%

28%

4% 11%

Intended use

Offices

Commercial

Logistics

Residential

Industrial

Other

41%

8%

37%

14%

Geographic distribution

North west

North east

Centre

South and islands

12.

Agenda


II Business trends




13.

Consolidated reclassified income statement

Consolidated income statement (€/000) 30-giu-14 30-giu-15 Var %Interest margin 7,007 4,995 -28.7%Dividends 1,558 1,766 13.4%Net Commissions 11,153 21,591 93.6%Profit (loss) on proprietary trading activities 1,566 2,585 65.1%Earning margin 21,284 30,937 45.4%

Administrative expenses (17,186) (24,377) 41.8%Value adjustments (amortisation/depreciation) (252) (293) 16.3%Other operating income (expense) 1,027 2,092 103.7%Operating cost (16,411) (22,578) 37.6%

Profit (loss) from holdings 165 91 -44.8%Gross operating profit 5,038 8,450 67.7%

Value adjustments on receivables/financial assets (834) (1,488) 78.4%Net operating profit 4,204 6,962 65.6%

Income tax for the year (1,708) (1,409) -17.5%Third-party income (306) (1,417) 363.1%Net income for the year 2,190 4,136 88.9%

Highlights of the Group

14.

Highlights of the Group 30-giu-13 30-giu-14 30-giu-15

Interest margin/ Earnings margin 37.0% 32.9% 16.1%

Net commissions / Earnings margin 57.7% 52.4% 69.8%

Cost / Income ratio 79.3% 77.1% 73.0%

Gross operating profit / Earnings margin 22.5% 23.7% 27.3%

Net operating profit / Gross operating margin 88.6% 83.4% 82.4%

Net profit / Gross operating margin 44.7% 43.5% 48.9%

15.

Agenda


II Business trends




Main actions taken

16.

• The BFE Group aims to develop and consolidate its presence as an excellent financial and real-estate manager in the Italian market.

• Reported below are the main actions taken between 2014 and the first half of 2015, consistently with the guidelines identified in the Plan.

Financial

● Developing existing funding and acquiring new assets through the current commercial workforce and by adding new consultants.

● Start and development of the evolved financial consultancy service. ● Scouting and assessment of growth opportunities for external lines through

the acquisition of competitors. In particular the Bank took part in the procedure aimed at the potential acquisition of Banca Cesare Ponti, which was not successful.

1

Real Estate

● Finalisation of the merger with the subsidiary Investire Immobiliare, Beni Stabili Gestioni SGR and Polaris Real Estate SGR.

● This transaction allowed the Group to consolidate its presence in the sector of Real Estate Asset Management Companies by becoming the majority shareholder of the second operator in the Italian market without committing any capital.

2

17.

Strategic guidelines

Indirect Deposits ● Increasing the revenues from indirect deposits while expanding the customer base

and developing the products managed and the remunerated consultancy

2

Services to SMEs ● Expanding the service portfolio ● Developing and consolidating the corporate consultancy activity ● Developing the services for AIM Italia in order to gain a leading market position

3

Properties ● Searching for new opportunities ● Giving value to holdings

7

Strategic guidelines

Real Estate Asset Management

Company

● Valorising the assets managed ● Increasing volumes and profitability

6

Loans to customers ● Increasing the interest margin linked to the disbursement of loans to customers, with

a limited risk profile and with the aim of shortening the average maturity of the portfolio

1

Trust activity 5

● Merger between Finnat Fiduciaria and Fedra Fiduciaria

Other services for institutional customers

4 ● Establishing a management company under Luxembourg law (ManCo) ● Seizing potential cross selling opportunities

18.

Lines of action (1/3)

● Expanding the service portfolio ● Developing and consolidating the corporate

consultancy activity ● Developing the services for AIM Italia in order to

gain a leading market position

● Expanding and consolidating the market plan addressing Italian SMEs, also by networking with professional practices and funds connected to minibonds or mezzanine capital

● Implementing commercial synergies with other sectors of the bank for the acquisition of new potential customers

Strategic guidelines Lines of action

● Increasing the revenues from indirect deposits while expanding the customer base and developing the products managed and the remunerated consultancy

● Acquiring new customers and increasing the assets through the current commercial workforce and by adding new consultants

● Developing remunerated private consulting ● Pursing any growth strategies for external lines (e.g. acquisition of

competitors) ● Consolidating and developing the portfolio of products / services

offered to institutional customers

Indirect Deposits 2

Services to SMEs 3

● Increasing the interest margin linked to the disbursement of loans to customers, with a limited risk profile

● Increasing the average return of medium/long-term investments through an amount of new gross grants (with spreads in line with those applied in the last few years) that allow the progressive replacement of maturing loans and a slight rise in volumes

● Increasing short-term disbursements in the form of guaranteed current account credit opening

Loans to customers 1

19.



● Establishing a management company under Luxembourg law (ManCo)

● Seizing potential cross selling opportunities

● Offering administrative, control and governance services to foreign managed Luxembourg SICAVs

● Consolidating the customers base and institutional relations to encourage adhesion to BFE service proposals in the Group's various business sectors

Other services for institutional customers

● Merger between Finnat Fiduciaria and Fedra Fiduciaria

● Rationalising the trust activity for operating and strategic requirements deriving from both the industry regulations and the objective of optimising costs for greater operating efficiency

Trust activity

4

5

● Expanding the service portfolio

● Developing and consolidating the corporate consultancy activity

● Developing the services for AIM Italia in order to gain a leading market position

● Acquiring mandates on the AIM Italia market through the leading position BFE is acquiring on the market, also in light of the transactions carried out in the last few years

● Analysing and developing potential financial advisory activities in financial sectors and innovative lending sources (minibonds, mezzanine, non-performing loans)

Services to SMEs 3

20.



● Valorising the assets managed

● Increasing volumes and profitability

● Disposing of the existing real estate assets, with special reference to the FIP fund

● Physiological growth of the currently managed funds and development of existing asset class products

● Developing new initiatives by identifying potential business opportunities in sectors such as: corporate real estate, nursing homes and protected residences, non-performing bank loans, hotel industry, social housing, spin-offs of non strategic portfolios of public entities

Real Estate Asset Management Company

● Searching for new opportunities

● Giving value to holdings

● Pursing any growth strategies for external lines (e.g. acquisition of competitors)

● Acquiring new holdings and/or disposing of the holdings currently in the portfolio

● Increasing and developing treasury operations

Properties

6

7

21.

Agenda


II Business trends




7,8 8,49,3

11,2

0

2

4

6

8

10

12

14

2014A 2015E 2016E 2017E

22.

Indirect deposits

• Indirect deposits from private customers are expected to grow more than Euro 400M by the year 2017, also thanks to the addition of 19 new private bankers to the current team of 31.

New indirect deposits from private customers (Euro M) Commissions from indirect deposits (Euro M)

• Commissions are expected to rise from Euro 7.8M in 2014 to Euro 11.2M in 2017, recording a CAGR equal to 13%.

• The increase is attributable to a larger customer base and the development of managed products and remunerated consultancy activities.

CAGR+13%

92 50 50

192 23 85 118

226

115 135

168

418

0

50

100

150

200

250

300

350

400

450

2015E 2016E 2017E Totale

Current team New private bankers

23.

Real Estate Asset Management Company

• The graph shows how the assets managed have evolved in terms of Long Term & Residential, Specialistic Market and Development & Social Housing.

• In 2017 total assets should reach Euro 9.3B, recording a rise of Euro 2.2B, while the number of funds managed should rise from the current 35 to 43.

Assets managed (Euro M)

3.913 3.8464.774 4.539

1.944 1.885

2.277 2.4191.218 1.318

1.580 2.2997.074 7.048

8.631

9.258

0

1.000

2.000

3.000

4.000

5.000

6.000

7.000

8.000

9.000

10.000

11.000

12.000

13.000

2014A 2015E 2016E 2017E

Long Term & Residential (1) Specialistic Market Development & Social Housing

Commissions (Euro M)

CAGR+9%

• Commissions include management fees, development fees, other variable fees and commissions for consultancy services.

• In 2017 commissions should total Euro 38.9M, recording a CAGR of 10%.

8,6 10,416,3

12,4

14,4 11,7

11,3

11,6

6,5 7,6

9,3 14,8

29,5 29,7

36,938,9

0

5

10

15

20

25

30

35

40

45

50

55

2014A 2015E 2016E 2017E

Long Term & Residential (1) Specialistic Market Development & Social Housing

CAGR+10%

(pro forma) (pro forma)

24.

Evolution of Group's assets

Total assets at year end (Euro M)

CAGR+9%

• The Group's assets are broken down below by direct deposits, indirect deposits (administered deposits, consultancy, UCIs, BFE managed savings and policies), trust activity and Real Estate Asset Management Company.

• Real estate assets are expressed in terms of market value of the assets managed and do not include the asset management mandates. The proforma data of the post-merger asset management company was considered for the year 2014.

• Total assets are predicted to record a CAGR of 9%, increasing from Euro 13.2B in 2014 to Euro 16.9B in 2017. Indirect deposits should rise from Euro 4.3B in 2014 to Euro 5.5B in 2017 due to the development of managed products.

Breakdown of indirect deposits (Euro M)

CAGR+8%

337 407 431 467

4.338 4.998 5.232 5.454

1.472 1.550 1.627 1.709

7.074 7.048

8.631 9.258

13.221 14.003

15.921 16.888

0

2.000

4.000

6.000

8.000

10.000

12.000

14.000

16.000

18.000

20.000

22.000

2014A 2015E 2016E 2017E

Direct customer deposits Indirect deposits Trust activities RE Asset Management Company

3.182 3.669 3.669 3.669

184 249 274 304

270 312 355 410

31 32 39 47

672 735 894 1.023

0 0 0 0

4.338

4.998 5.232 5.454

0

1.000

2.000

3.000

4.000

5.000

6.000

7.000

8.000

2014A 2015E 2016E 2017E

Administered deposits Consultancy UCIs Policies BFE savings managed

25.

Net commissions trend

Total net commissions (Euro M)

• Net commissions are expected to rise from Euro 25.8M in 2014 to Euro 56.9M in 2017.

• A growing incidence of net commissions on the earnings margin up to about 80% in the two-year period 2016/2017 is highlighted compared to 57% in 2014.

• Such performance will be mainly attributable to the development of the commercial plan arranged for the private banking area and the hypotheses of development, valorisation and disposal of the portfolio managed by the real estate asset management company.

Net commissions/Earnings Margin (%)

25,8

44,0

52,8

56,9

0

10

20

30

40

50

60

2014A 2015E 2016E 2017E

56,9%

74,4%79,9% 79,5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

2014A 2015E 2016E 2017E

Plan Targets – Main financial data

26.

Operating costs (Euro M) Earnings margin (Euro M)

Cost / Income ratio (%)

45.3

59.266.1

71.6

0

10

20

30

40

50

60

70

80

2014A 2015E 2016E 2017E

33,8

46,3 48,150,7

0

10

20

30

40

50

60

2014A 2015E 2016E 2017E

74.8%78.3%

72.8% 70.8%

20%

30%

40%

50%

60%

70%

80%

90%

2014A 2015E 2016E 2017E

• In 2017 the earnings margin and the operating costs should reach Euro 71.6M and Euro 50.7M, respectively.

• The rise in revenues is mainly attributable to the rising net commissions.

• The trend of operating costs reflects the hiring plans of the parent company and the subsidiaries.

• A decrease in the cost / income ratio is predicted, from 74.8% in 2014 to 70.8% in 2017.

27.

Plan Targets – Capital soundness

• At the end of the plan timeframe, the persistence of a high capital soundness is highlighted, which is accompanied by a risk profile that remains essentially unchanged.

• In 2017 Tier 1 Capital and Own funds will equal Euro 157M and Euro 158M, respectively, compared to first pillar risks of Euro 47M.

• The Tier 1 ratio and the Total Capital ratio will stand at high levels in the whole period of the Plan, both reaching about 27.0% in 2017.

RWA first pillar risks (Euro M) Tier 1 capital and Own funds (Euro M)

Tier 1 ratio and Total Capital ratio (%)

29,5%29,0%

27,7%

27,0%

29,8%29,2%

27,9%

27,2%

20%

21%

22%

23%

24%

25%

26%

27%

28%

29%

30%

2014A 2015E 2016E 2017ETier 1 ratio Total Capital ratio

135

146

151

157

137

147

152

158

100

110

120

130

140

150

160

2014A 2015E 2016E 2017E

Class 1 capital Own funds

25 27 29 30

4 5 5 6 7 8

9 11

37 40

43 47

0

10

20

30

40

50

60

2014A 2015E 2016E 2017E

Credit risk Market risk Operating risk

28.

Plan Targets – Return on equity

• In the period of the plan, a recovery in profitability is highlighted, in terms of ROE, which will equal 3.9% in 2017 with a net income of Euro 8.8M.

• The increase in ROE is significant also when considering that a high capital soundness has been maintained.

Net income (Euro M – without release1) ROE (%)

4,25,3

7,98,8

0,0

1,0

2,0

3,0

4,0

5,0

6,0

7,0

8,0

9,0

10,0

2014A 2015E 2016E 2017E

2,2%2,5%

3,6%3,9%

0,0%

0,5%

1,0%

1,5%

2,0%

2,5%

3,0%

3,5%

4,0%

4,5%

5,0%

2014A 2015E 2016E 2017E

(1) It does not include the accounting effects deriving from releasing the goodwill recorded after the merger of the real estate asset management company, whose impact on the income statement is estimated to equal Euro +3.2M in 2015.

29.

DISCLAIMER: THE MANAGER RESPONSIBLE FOR PREPARING THE COMPANY'S FINANCIAL REPORTS (PAOLO COLLETTINI)

DECLARES, PURSUANT TO PARAGRAPH 2 OF ARTICLE 154 BIS OF THE ITALIAN CONSOLIDATED LAW ON FINANCE, THAT THE ACCOUNTING INFORMATION CONTAINED IN THIS DOCUMENT CORRESPONDS TO THE RESULTS FROM THE DOCUMENTS, THE LEDGERS AND THE ACCOUNTING ENTRIES.

THIS PRESENTATION DOES NOT CONSTITUTE AN OFFER TO SELL OR TO DEMAND THE OFFER TO PURCHASE SHARES OF BANCA FINNAT.

THE INFORMATION IN THIS DOCUMENT, AND IN PARTICULAR THE INFORMATION PERTAINING TO THE FUTURE PERFORMANCE OF BANCA FINNAT, REFERS TO FORECASTS AND ESTIMATES THAT REFLECT THE CURRENT OPINION OF BANCA FINNAT'S MANAGEMENT REGARDING FUTURE EVENTS AND, AS SUCH, IS SUBJECT TO RISKS AND UNCERTAINTIES. BANCA FINNAT'S ABILITY TO ATTAIN THE PREDICTED RESULTS DEPENDS ON SEVERAL FACTORS THAT ARE OUTSIDE THE MANAGEMENT'S CONTROL. THE ACTUAL RESULTS MAY DIFFER SIGNIFICANTLY (AND ALSO BE NEGATIVE) FROM THOSE PREDICTED OR IMPLICIT IN THE FORECAST MODELS. ANY REFERENCE TO THE GROUP'S PAST PERFORMANCE MUST NOT BE CONSTRUED AS AN INDICATION OF FUTURE PERFORMANCE. THE PRESENTATION, WHICH WILL NOT BE SUBJECT TO SUBSEQUENT REVIEW OR UPDATED, CANNOT BE REPRODUCED, REDISTRIBUTED OR FORWARDED, ENTIRELY OR PARTLY, TO ANY OTHER PERSON.

Contacts

30.

INVESTOR RELATIONS MANAGER Gian Franco Traverso Guicciardi Tel. +39 06 69933440 E-mail: [email protected]

PRESS OFFICE SEC Marco Fraquelli Tel. +39 02 62499979 E-mail: [email protected]

banca finnat euramerica financial results as of 30.06.2015 ... · banca finnat euramerica financial...

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