covered bonds investor presentation · 2018. 6. 3. · 4 1h 2015 highlights market share of...

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Covered Bonds Investor Presentation

June 2015

2

Index

01 EXECUTIVE SUMMARY

Bankia Results……………………………………………………………………. 3

Covered Bonds Ratings…………………………………………………….. 5

02 MORTGAGE COVER POOL

Cover Pool Metrics…………………………………………………………….. 6

Residential Sub-Pool in figures………………………………………. 8

Commercial Sub-Pool in figures…………………………………….. 9

03 WHOLESALE MATURITIES

Wholesale Maturities profile………………………………………..… 10

04 ANNEXES

Macroeconomic Indicators……………………………………………. 11

Spanish Real Estate Markets…………………………………………. 12

Disclaimer

This document has been prepared by Bankia, S.A. (“Bankia”) and is presented exclusively for information purposes. It is not a prospectus and does not constitute an offer or recommendation to invest.

This document does not constitute a commitment to subscribe, or an offer to finance, or an offer to sell, or a solicitation of offers to buy securities of Bankia, all of which are subject to internal approval by Bankia.

Bankia does not guarantee the accuracy or completeness of the information contained in this document. The information contained herein has been obtained from sources that Bankia considers reliable, but Bankia does not represent or warrant that the information is complete or accurate, in particular with respect to data provided by third parties. This document may contain abridged or unaudited information and recipients are invited to consult the public documents and information submitted by Bankia to the financial market supervisory authorities. All opinions and estimates are given as of the date stated in the document and so may be subject to change. The value of any investment may fluctuate as a result of changes in the market. The information in this document is not intended to predict future results and no guarantee is given in that respect.

Distribution of this document in other jurisdictions may be prohibited, and therefore recipients of this document or any persons who may eventually obtain a copy of it are responsible for being aware of and complying with said restrictions. By accepting this document you accept the foregoing restrictions and warnings.

This document does not reveal all the risks or other material factors relating to investments in the securities/ transactions of Bankia. Before entering into any transaction, potential investors must ensure that they fully understand the terms of the securities/ transactions and the risks inherent in them. This document is not a prospectus for the securities described in it. Potential investors should only subscribe for securities of Bankia on the basis of the information published in the appropriate Bankia prospectus, not on the basis of the information contained in this document.

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ATTRIBUTABLE PROFIT

966 Mn€ *

NET INTEREST INCOME

2,927 Mn€

NEW LENDING

+40%

CET1 PHASE IN

12.28% CET1 FULLY LOADED

10.60%

01. EXECUTIVE SUMMARY

Bankia Results

€

CUSTOMER FUNDS

+6.6% €

BRANCHES

1,978 CUSTOMER FUNDS

152,242 Mn€

ATMs

5,593 POS TERMINALS

86,315

CUSTOMER LOANS

121,769 Mn€

€

€

2014 HIGHLIGHTS

UNIVERSAL BANKING MODEL, based on multi-channel management, with a presence throughout Spain and high market shares in historical core regions.

BEST IN CLASS CORPORATE GOVERNANCE, optimal organizational structure and highly respected management team

SOLVENT, EFFICIENT AND PROFITABLE INSTITUTION, following implementation of 2012-2015 Strategic Plan, with a 9.8% ROE in the 1H 2015, in line with the target of 10% by the end of 2015.

CLEAN BALANCE SHEET, with reduced real estate developer exposure and high loan loss coverage.

SUSTAINABLE CAPITAL AND LIQUIDITY GENERATION. Comfortable solvency levels with a ratio of Common Equity Tier I – BIS III Phase In of 12,8% and BIS III Fully Loaded of 11,3% as of June 15.

POSITIVE COMMERCIAL DYNAMICS, with growth in new lending to consumers and businesses, and an increase in retail customer funds. New credit grow 35% compared to 1H 2014.

* Excludes the impact of IPO contingency provision

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1H 2015 HIGHLIGHTS

MARKET SHARE OF HOUSEHOLD MORTGAGES 12.28%(1) 12.25%

NEW LENDING(2) 8,021 7,827

COMMERCIAL ACTIVITY

NON-PERFORMING LOANS 15.3 €

18.6

NPL COVERAGE RATIO 60.6% 58.9%

NPL RATIO 12.2% 14.0%

ATRIBUTABLE PROFIT 556 €

498

CET1 BIS III FULLY LOADED 11.31% 9.95%

%

JUNE 2015 DEC 2014

ASSET QUALITY 1H 2015 1H 2014

PROFITABILITY & CAPITAL 1H 2015 1H 2014

COST OF RISK 53 66 bps

%

%

€bn

€Mn

ROE 9.8% 7.9%

€Mn

%

%

ISSUER RATINGS

LONG TERM OUTLOOK SHORT TERM

STANDARD & POOR’S

FITCH RATINGS

BB Stable B

BB+ Positive B


Bankia Results

(1) May-15; (2) 6 months. Does not include refinancings

1 COMMERCIAL ACTIVITY

+ €1.4 Bn Customer Funds vs. Dec14

+ 4,0% Loans to businesses and consumers 1H15 vs. 1H14

2 EFFICIENCY & PROFITABLITY

41.5% Cost to Income ratio 1H15

9.8% ROE 1H15

3 ASSET QUALITY

€ 1.2 bn NPL´s reduction vs Dec 14

60.6% Coverage ratio (+3.0 p.p. vs Dec 14)

4 CAPITAL GENERATION

+ 71 bps Capital generation in 1H15 (CET1 BISIII FL)

MARKET SHARE OF BUSINESS LENDING

5.80%(1) 5.74%

+ 11.5% Attributable Profit vs. 1H14

5


Covered Bonds Ratings

BANKIA’S RATINGS HAVE STRENGTHENED AS A RESULT OF THE IMPROVEMENT IN THE MATURITY PROFILE OF THE COVERED BONDS OUTSTANDING AND THE OVERCOLLATERALIZATION LEVEL, AND ULTIMATELY THE CHANGES IN METHODLOGY DUE TO THE BRRD FRAMEWORK.

On 5 February 2015, S&P having adapted its rating methodology, affirmed Bankia’s covered bond rating at “A”, outlook Negative. This rating was once again affirmed in March after a new €1 billion covered bond issue. Finally on 27 April, S&P revised the covered bond outlook to Stable as a result of Bankia’s long-term rating being affirmed and it outlook being revised to Stable.

Fitch Ratings raised Bankia’s covered bond ratings by one notch from “BBB+” to “A-”, outlook Stable, on 6 April 2015. This action was a result of an improved OC level and the impact of Fitch’s revised methodology. Subsequently on 27 May, Fitch affirmed the rating at “A-”, outlook Stable, taking into account the positive trend of the OC level due to Bankia’s active management of its retained covered bonds, that allows sufficient margin to maintain the current rating level.

On 26 March 2015, as a result of a new €1 billion covered bond issue, DBRS affirmed its covered bond rating at “A (high)”. On 26 May, DBRS placed Under Review with Developing Implications Bankia’s covered bond programme after announcing a Request For Comments for its covered bond methodology that proposes a new analysis for the determination of European covered bond ratings that are subject to the Bank Recovery and Resolution Directive (BRRD).

A Stable

A+

2013 2014 2015

BBB

A-

A

Fitch Ratings Standard & Poor’s

A-

BBB+

DBRS

2013 2014 2015

A-

A+

2013 2014 2015

DBRS

A- Stable

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02. MORTGAGE COVER POOL

Cover Pool Metrics

AMPLE

ISSUANCE

CAPACITY

HIGH

OC

LEVEL

0

20.000

40.000

60.000

80.000

100.000

120.000

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

STRONG

ELEGIBLE

COVER

POOL

COLLATERAL AND CB’s OUTSTANDING

86,519

71,067

51,607

41,286

33,941

7,345

Total Collateral Elegible Legal Issuance Issued

84% Residential

16% Commercial

73% of the cover pool eligible € 7,345

million Issuance Capacity

X 80%

2012 2013 2014 2015

X 2,09 over-collateralized

Collateral CB’s Outstanding

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Cover Pool Metrics

Q2 2015 Q4 2014

Collateral Eligible Collateral Eligible

Outstanding (million €) 71,067 51,607 73,968 54,006

Number of loans 712,338 600,723 723,529 610,629

Number of debtors 634,722 548,652 643,643 556,182

Average Seasoning (months) 79 88 74 83

Life (months) 326 331 323 329

Time to maturity (months) 247 243 249 246

Average LTV 62% 50% 62% 51%

Q2 2015 Q4 2014


Residential 58,167 47,155 59,809 48,769

Commercial 9,360 2,284 10,368 2,783

SME 2,909 1,818 3,126 2,069

Developers 534 350 568 384

Land 98 0 96 0

0

5.000

10.000

15.000

20.000

25.000

0-40% 40%-60% 60%-80% 80%-100% >100%

Mill

ones

COLLATERAL LTV DISTRIBUTION

NPL RATIO

80% OF THE

COVER POOL

HAS A LTV

RATIO BELOW

80%

POSITIVE NPL’S

PERFORMANCE

WITH NPL RATIO

STANDING AT 7.70%

AS OF 2Q15

8,18%7,70%

Jun 14 Jun 15

Source: ECBC Label. In Spain a loan is doubtful when: Repayment is considered uncertain and some losses are expected; and also when the loan is in arrears: the obligor is past due more than 90 days on the mortgage credit obligation to the credit institution (that includes capital, interest payments..) or when the total amount due to the lender exceeds 25% of the mortgage debt (and it has not been considered as a default yet).

-48 bps

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RESIDENTIAL PORTFOLIO


Residential Sub-Pool in figures

RESIDENCIAL

PORTFOLIO

ELIGIBILITY

STANDS AT 81%

AVERAGE LTV

OF THE

PORTFOLIO IS

51%

Q2 2015 Q4 2014


Outstanding (million €) 58,167 47,155 59,809 48,769

Number of loans 667,209 570,875 676,153 579,216



Life (months) 355 339 353 340


Average LTV 58% 51% 59% 52%

MATURITY DISTRIBUTION

0

5.000

10.000

15.000

20.000

25.000

1-5 5-10 10-20 20-30 >30

Mill

on

es

GEOGRAPHIC DISTRIBUTION Q2 2015

Madrid 19,703

C. Valenciana 9,117

Catalunya 8,652

Andalucía 5,406

Castilla La Mancha 3,181

Canarias 3,053

Castilla y León 2,565

Resto 6,489

91% LOANS FOR PRIMARY RESIDENCE

34%

15%

16%5%

4%

9%

5%

2%

1% 1% 1%

1%1%

1%

1%

2%

98% FIRST RANKED MORTGAGES

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COMMERCIAL PORTFOLIO

RESTRICTIONS

TO COMMERCIAL

MORTGAGE

LENDING IN

RECENT YEARS

AVERAGE LTV

OF THE

COMMERCIAL

PORTFOLIO

STANDS AT 36%

Q2 2015 Q4 2014


Outstanding 12,901 4,452 14,158 5,236

Number of loans 45,129 29,848 47,376 31,413



Life (months) 192 204 196 223


Average LTV 76% 36% 74% 40%

SPLIT BY INDUSTRY CODE

MATURITY DISTRIBUTION

0

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

4.500

5.000

1-5 5-10 10-20 20-30 >30

Mill

on

es


Commercial Sub-Pool in figures

Building & Materials

Real Estate

Business Services

Transport. Retail Lodging/ Restaurants

Energy Healthcare Food / Beverage / Tobacco

Leisure / Entertainment

Industrial Consumer Products

Others

18%

13%

10% 9% 8% 8% 6%

3% 3% 3% 3% 3%

13%

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03. WHOLESALE MATURITIES

Wholesale Maturities Amortizing Profile

2,069 5,610 1,026 2,241 2,620 127 512 9,475

Amount Outstanding (€Mn) 23,679

Covered Bonds (*) 20,124

Senior Debt 2,555

Subordinated debt 1,000

(*) Not including retained covered bonds

1.925

5.152

555

2.166 1.630

127 477

8.093

144

458

471

75 990

35

382

1.000

2015 2016 2017 2018 2019 2020 2021 >2021

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04. ANNEXES

Macroeconomic Indicators

QUARTERLY SERIES GDP. PREVIUS QUARTER RATE (%)

0,9

0,7

0,50,5

0,30,3

0,1

-0,1

-0,3

1T 20154T 20143T 20142T 20141T 20144T 20133T 20132T 20131T 2013

SPAIN SOVEREIGN DEBT RATING

LONG TERM OUTLOOK SHORT TERM

STANDARD & POOR’S

FITCH RATINGS

BBB Stable A-2

BBB+ Stable F2

MOODY’S

DBRS

Baa2 Positive P-3

A- Stable R-1-

UNEMPLOYMENT RATE IN SPAIN

0%

5%

10%

15%

20%

25%

30%

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 mar-15

“GROWTH

CONSOLIDATION

”

“FAVOURABLE

EMPLOYMENT

TREND”

“IMPROVED

FINANCIAL

CONDITIONS AND

INCREASED

MARKET

CONFIDENCE”

€

AVERAGE EXPENDITURE OF HOUSEHOLDS. PREVIOUS YEAR RATE (%)

-0,2

-3,7

-3,4

-1,0

-2,5

-4,8

0,2

4,7

-6,0

-4,0

-2,0

0,0

2,0

4,0

6,0

20142013201220112010200920082007

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04. ANNEX

Spanish Real Estate Market

MORTGAGES CONSTITUTED OVER DWELLINGS

EVOLUTION OF THE QUARTERLY RATE OF THE GENERAL HPI

“Mortgages

over dwellings

quarterly

increase 23%”

“The general

HPI variation in

the first

quarter 2015

was –0.6%.”

“New housing

prices increased

by 2.2% ”

0

10.000

20.000

30.000

40.000

50.000

60.000

70.000

Q1-2013 Q2-2013 Q3-2013 Q4-2013 Q1-2014 Q2-2014 Q3-2014 Q4-2014 Q1-2015

-0,6

0,20,2

1,7

-0,3-1,3

0,7

-0,8

-6,6

Q1-2015Q4-2014Q3-2014Q2-2014Q1-2014Q4-2013Q3-2013Q2-2013Q1-2013

EVOLUTION OF THE QUARTERLY RATE OF THE HPI BY TYPE OF HOUSING

2,2

-0,1

1,2

0,60,1

-1,2

2,3

-2,4

-6,8

-1,0

0,3

0,0

1,9

-0,4

-1,3

0,1

-0,1

-6,5

Q1-2015Q4-2014Q3-2014Q2-2014Q1-2014Q4-2013Q3-2013Q2-2013Q1-2013

-2,0

-1,5

-1,0

-0,5

0,0

0,5

1,0

1,5

2,0

2,5

3,0

3,5

1Q 2015. ANNUAL VARIATION RATE OF THE HPI BY AUTONOM. COMMUNITY

New housing Second-hand housing

covered bonds investor presentation · 2018. 6. 3. · 4 1h 2015 highlights market share of...

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