BANCA TRANSILVANIA June 2016 Financial Results

BANCA TRANSILVANIA

June 2016 Financial Results

August 2016

The information contained in the present document has not been independently verified and

no representation or warranty expressed or implied is made as to, and no reliance should be

placed on the fairness, accuracy, completeness or correctness of this information or opinions

contained herein.

Banca Transilvania cautions readers that no forward-looking statement that may be contained

in the present document is a guarantee of future performance and that actual results could

differ materially from those contained in the forward-looking statements. Forward-looking

statements speak only as of the date they are made, and Banca Transilvania undertakes no

obligation to update publicly any of them in light of new information or future events.

None of Banca Transilvania or any of its affiliates, advisors or representatives shall have any

liability for any loss howsoever arising from any use of this document or its content or

otherwise arising in connection with this document.

The present document does not constitute a public offer under any applicable legislation or an

offer to sell or solicitation of any offer to buy any securities or financial instruments or any

advice or recommendation with respect to such securities or other financial instruments.

DISCLAIMER

2

AGENDA

Banking Sector Dynamics

H1 2016 Highlights

Performance in H1 2016

Overview of Business Lines

BT Financial Group

Financial Statements

1

2

3

4

5

A

3

20.4%

19.2%

21.5%20.7%

20.2%

16.2%15.7%

13.5% 13.5%

1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16

NPL ratio, % source: NBR

356355

354

362

353 352351

364

361363

360

377

370

-1.8%

-4.3%

-5.3%

-0.9% -1.0%-0.7% -0.6%

0.5%

2.4%

3.1%

2.3%

3.6%

2.5%

320

330

340

350

360

370

380

-8%

-6%

-4%

-2%

0%

2%

4%

6%

8%

10%

1Q13 3Q13 1Q14 3Q14 1Q15 3Q15 1Q16

total bank net assets source: NBR

BANK ASSETS

continue to grow at a steady pace in 2016

net assets

in RONbn

net assets

%YoY

Bank assets advanced by 2.5%

YoY over the first quarterNPL ratio stabilized at 13.5%

BANKING SECTOR DYNAMICS H1 2016 highlights PERFORMANCE IN H1 2016 OVERVIEW OF BUSINESS LINES BT FINANCIAL GROUP

4

NBR 2

nd

defi

nit

ion

EBA

definition

LCY LOANS DISPLAY DOUBLE-DIGIT ANNUAL GROWTH

despite slowdown in overall lending activity

102

108110

114

119

113

107 107

102

99

6000%

7000%

8000%

9000%

10000%

11000%

12000%

13000%

2Q15 3Q15 4Q15 1Q16 2Q16

loans non-government , RONbn source: NBR

RO

N l

oans

FCY l

oans

Lending activity slowing down over

the first two quarters of 2016

Yet loans in LCY continue

expanding, now at 54% of total

-1.3

%

-3.3

%

-3.3

% -2.7

%

-3.9

%

-4.5

%

-3.3

%

-3.4

%

-0.1

%

0.6

%

3.0

%

2.8

%

1.2

%

-5%

-4%

-3%

-2%

-1%

0%

1%

2%

3%

4%

2Q13 4Q13 2Q14 4Q14 2Q15 4Q15 2Q16

loans non-government , %YoY source: NBR


5

ROMANIAN ECONOMY

Strong increase of the private consumption

GDP rose by 5.2% YoY in 1H2016,

due to the expansionary policy-mix

Stimulated consumption vs.

sluggish investments

BANKING SECTOR DYNAMICS 2015 highlights PERFORMANCE IN 2015 OVERVIEW OF BUSINESS LINES BT FINANCIAL GROUP

60

1

2

3

4

5

6

7

8

9

10

-20

-10

0

10

20

30

40

Jan-1

2

Apr-

12

Jul-1

2

Oct-

12

Jan-1

3

Apr-

13

Jul-1

3

Oct-

13

Jan-1

4

Apr-

14

Jul-1

4

Oct-

14

Jan-1

5

Apr-

15

Jul-1

5

Oct-

15

Jan-1

6

Apr-

16

Retail sales Industrial production (rhs)

Retail sales vs. industrial production,

MA12, %YoY source: Statistics Office (INS)

-10

-5

0

5

10

15

1Q

06

1Q

07

1Q

08

1Q

09

1Q

10

1Q

11

1Q

12

1Q

13

1Q

14

1Q

15

1Q

16

GDP, %YoY source:: Statistics Office (INS)

THE IMPACT OF THE PRO-BREXIT VOTE

HIGHER PRUDENCE AND LOWER FINANCING COSTS

Inflexion of the CPI dynamics, as the

impact of the VAT cuts is fading out

The 10YR financing costs down

close to the record low levels

BANKING SECTOR DYNAMICS 2015 highlights PERFORMANCE IN 2015 OVERVIEW OF BUSINESS LINES BT FINANCIAL GROUP

7-5.0

-3.0

-1.0

1.0

3.0

5.0

7.0

Jan-1

3

Apr-

13

Jul-1

3

Oct-

13

Jan-1

4

Apr-

14

Jul-1

4

Oct-

14

Jan-1

5

Apr-

15

Jul-1

5

Oct-

15

Jan-1

6

Apr-

16

Jul-1

6

consumer prices, %YOY source: Statistics Office (INS)

1.2

1.4

1.9

2.8

3.8

0.4 0.4

1.5

2.2

2.9

0.0

1.0

2.0

3.0

4.0

5.0

11-Aug-15

11-Aug-16

yield curve, % source: NBR


BancaTransilvania’s

business development and

financial performance

H1 2016

8

PR

OF

ITA

BIL

ITY

Mil. RON H1 2016 H1 2015 ∆

Operating income 1,415.2 946.8 49.5%

Operating expenses (551.7) (483.7) 14.1%

Gross profit before provisions 863.5 463.1 86.5%

Net profit 458.3 190.2 140.9%

EPS RON 0.13 0.05 140.9%

Cost of risk (%) 2.20% 2.33% -5.7%

NIM (%) 3.40% 2.84% 0.6 pp

ROE (%) 16.49% 10.40% 6.1 pp

Cost-to-income ratio (%) 38.98% 51.09% -12.1 pp

CR

ED

IT

AC

TIV

ITY

Jun-16 Dec-15 ∆

Gross loans to customers 28,642.4 27,740.0 3.3%

Deposits from customers 39,020.7 38,395.3 1.6%

Loans-to-deposits ratio 66% 65% 1 pp

NPL ratio 9.17% 9.75% -0.6 pp

CA

PIT

AL Jun-16 Dec-15 ∆

Total equity 5,301.0 6,117.8 -13.3%

Tier 1 capital ratio (profit included) 16.98% 16.43% 3.3%

Total capital ratio (profit included) 18.17% 17.82% 1.9%

9


H1 2016 HIGHLIGHTS


Total assets at RON 47.9 bn ● Enhanced ALM for higher efficiency

Capital adequacy ratio at 18.2%● Strong capital base, supporting organic and non organic growth, after special

dividend payout

Net fees and commissions at RON

242.9 mn 15.2% Y/Y● Driven by increased number of operations and additional cross-sell

Conservative CoR● CoR at 2.20%, mainly driven by a very conservative approach with regard to

the Walkaway law

Net profit at

RON 458.3 mn 140.9% Y/Y● Operating income positively influenced by increase in all income positions

Cost/income at 39.0%● Cost to income was positively influenced by both recurrent and one-off

items

10

BUSINESS PERFORMANCE 2016

at a glance

11


DETAILED INCOME STRUCTURE

190

36

237

484

144

70

211

522

458

80

325

552

234

81

243

858

+15,5%

+15,2%

+64,3%

Net profitIncome taxCost of risk

+121,7%

+37,3%

Net interest income

+140,9%

Operating expenses

Other net operating income *

Net trading income

Net fee and commission

income

+14,1%

+62,4%

H1 2016H1 2015

* Visa transaction related income is included here

*SMEs identified according to internal classification rules

Loans to Households, RONbn Loans to Companies, RONbn

12


LOAN STRUCTURE

Jun’16

8,3

5,3

0,04

Jun’15

9,4

5,9

3,5

0,03

14,3

8,2

6,1

0,04

Dec’15

13,6

consumptionhousingother

Jun’16

14,3

11,3

3,1

Dec’15

14,1

11

3.1

Jun’15

12,7

10

2.7

large corporatesSMEs

33%67%

RON FX

Loans to Households, RONbn Loans to Companies, RONbn

79%

RON FX

21%

DEPOSIT STRUCTURE

*SMEs identified according to internal classification rules

Jun’16

24,7

18,1

6,5

Dec’15

23,3

18,2

5,1

Jun’15

20,2

16,5

3,7

DepositsCurrent accounts

Deposits from Households, RONbn

Jun’16

5,2

Jun’15

11,7

8,2

3,6

14,4

9,6

4,7

Dec’15

15,1

9,9

large corporatesSMEs

Deposits from Companies, RONbn

42%58%

FXRON

22%78%

FXRON

Deposits from Households, RONbn Deposits from Companies, RONbn

13


NPL RATIO AT 9.17%

2015 HIGHLIGHTS BANKING SECTOR DYNAMICS PERFORMANCE IN H1 2016 OVERVIEW OF BUSINESS LINES BT FINANCIAL GROUP

● Banca Transilvania continued to provide a

sound coverage ratio for its PAR 90 portfolio

79%

40%

14

127%

81%

46%

13

122%

77%

45%

12

108%

75%

119%

15

33%

125%

H1 16

46%

79%

NPL coverage with provisions

NPL coverage with mortgage collaterals

14

*For Financial Statements purposes the gross loans are netted by the unwinding adjustment; For coverage ratio purposes the

respective adjustment is included in the total stock of provisions

Retail banking


32,500 non-card retail loans

Market share for retail loans at June 2016 - 14%

Internet banking users +19%

Mobile banking users +33%

2.7 active cards, of which about 300,000 credit

cards; BT is the market leader, both in terms of

number of cards, as well as volume of transactions

generated by its cards, with a market share of

over 19%;

6.326.80

7.47

10.34

14.31

3.3

500%

600%

700%

800%

900%

1000%

1100%

1200%

1300%

1400%

1500%

2012 2013 2014 2015 H1 2016

Retail Loan Portfolio, RONbn source: BT

loans transferred

from VBR

13.64

Retail loan portfolio reached RON

14.3 bn as at Jun’16

15

SME Banking

● Banca Transilvania continued its specific focus on

the SME business sector, offering almost 10,000

new loans in H1 2016

BT continued its partnership with DFIs, offering

special loan and guarantee products to its SME

clients

● Agriculture, Healthcare and European Structural

Funds are on BT radar as specialized sectorial

approaches

SME loan portfolio at RON 3.1 bn and

196,300 active clients

2.5 2.5

2.6

2.8

3.10.3

160%

180%

200%

220%

240%

260%

280%

300%

320%

2012 2013 2014 2015 H1 2016

SME Loan Portfolio, RONbn source: BT

loans transferred

from VBR

3.1

16


Corporate Banking

● An important reorganizational process was started

in the Corporate business line, including client

resegmentation & deeper sectorial specialization

BT was present with lending facilities especially in

the industrial manufacturing and agribusiness

segments

BT continued to play an important role as co-

lender of EU structural funds eligible projects

Corporate loan portfolio above

RON 11.28 bn

8.74

9.88 9.97 10.15

11.28

0.88

700%

750%

800%

850%

900%

950%

1000%

1050%

1100%

1150%

2012 2013 2014 2015 H1 2016

Corporate Loan Portfolio, RONbn source: BT

loans transferred

from VBR

11.04

17


BANCA TRANSILVANIA FINANCIAL GROUP

full array of financial services

Total assets: 73 RON mn.

AuM: 2,795 RON mn.




BANKING SECTOR DYNAMICS Q1 2016 highlights PERFORMANCE IN Q1 2016 OVERVIEW OF BUSINESS LINES BT FINANCIAL GROUP

Total assets: 47.9 RON bn

As of 30.06.2016:

18

BANKING SECTOR DYNAMICS Q1 2016 highlights PERFORMANCE IN Q1 2016 OVERVIEW OF BUSINESS LINES BT FINANCIAL GROUP

H1 2016 HIGHLIGHTS – consolidated figures

19

PR

OF

ITA

BIL

ITY

Mil. RON H1 2016 H1 2015 ∆

Operating income 1,479.0 1,378.2 7.3%


Gross profit before provisions 883.0 795.9 10.9%

Net income 481.1 2,071.6 -76.8%

EPS RON 0.13 0.57 -76.8%

Cost of risk (%) 2.22% 0.31% 618.8%

ROE (%) 16.49% 50.65% -67.4%

Cost-to-income ratio (%) 40.30% 42.25% -4.6%

CR

ED

ITA

CT

IVIT

Y Jun’16 Dec’15

Gross loans to customers 28,779.4 28,012.3 2.7%

Deposits from customers 38,926.5 38,301.7 1.6%

Loans-to-deposits ratio (%) 67% 66% 1.1%

CA

PIT

AL

Total equity 5,458.6 6,240.8 -12.5%

Tier 1 capital ratio (profit included) (%) 17.18% 16.70% 2.9%

Total capital ratio (profit included) (%) 18.35% 18.07% 1.6%

ANNEX I INCOME STATEMENT H1 2016 - individual

IFRS, individual, RONmn H1 2016 H1 2015 ∆

Net interest income 857.7 522.0 64.3%

Net fee and commission income 242.9 210.9 15.2%

Net trading income 80.7 69.8 15.5%

Other net income* 233.9 144.0 62.4%

Operating income 1,415.2 946.8 49.5%

Personnel expenses (304.8) (243.8) 25.0%

D&A (35.7) (26.9) 32.4%

Other operating expenses (211.2) (212.9) -0.8%


Cost of risk (325.2) (236.8) 37.3%

Net income before taxation 538.3 226.3 137.9%

Income tax expense (80.0) (36.1) 121.7%

Net income after taxation 458.3 190.2 140.9%

20* Including Visa transaction

IFRS, individual, RON mn Jun-16Dec-15

(audited)∆

Cash & cash equivalents 5,096.7 4,997.9 2.0%

Placements with banks 2,503.77 3,889.5 -35.6%

Loans to customers, net 25,851.2 25,107.5 3.0%

T-bills & securities 13,585.2 12,389.4 9.7%

Fixed assets 416.5 409.5 1.7%

Participations 84.9 84.9 0.0%

Other assets 352.9 464.0 -24.0%

Total assets 47,891.2 47,342.7 1.2%

Deposits from banks 509.5 388.4 31.2%

Deposits customers 39,020.7 38,395.3 1.6%

Loans from banks and FIs 1,337.9 985.1 35.8%

Subordinated loan 412.9 416.4 -0.8%

Deferred tax liabilities 0.0 0.0

Other liabilities 1,309.1 1,039.7 25.9%

Total liabilities 42,590.1 41,224.9 3.3%

Shareholders’ equity 5,301.0 6,117.8 -13.3%

21

ANNEX II BALANCE SHEET H1 2016 - individual

IFRS, consolidated, RONmn H1 2016 H1 2015 ∆

Net interest income 881.8 940.1 -6.2%

Net fee and commission income 258.5 229.8 12.5%

Net trading income 79.7 60.3 32.2%

Other net income * 258.9 148.0 75.0%

Operating income 1,479.0 1,378.2 7.3%

Personnel expenses (318.1) (292.4) 8.8%

D&A (45.2) (40.9) 10.4%

Other operating expenses (232.7) (248.9) -6.5%


Cost of risk (317.9) (336.1) -5.4%

Bargaining gain 0.0 1,650.6

Net income before taxation 565.1 2,110.4 -73.2%

Income tax expense (84.0) (38.8) 116.5%

Net income after taxation 481.1 2,071.6 -76.8%

22

ANNEX III INCOME STATEMENT H1 2016 - consolidated

* Including Visa transaction

23

ANNEX IV BALANCE SHEET H1 2016 - consolidated

IFRS, consolidated, RONmn Jun-16 Dec-15 ∆

Cash & cash equivalents 5,096.7 4,997.9 2.0%

Placements with banks 2,524.6 3,908.9 -35.4%

Loans to customers, net 25,913.9 25,225.6 2.7%

T-bills & securities 13,601.6 12,416.9 9.5%

Fixed assets 580.1 526.7 10.1%

Participations 0.0 0.0

Other assets 425.7 503.0 -15.4%

Total assets 48,142.7 47,579.1 1.2%

Deposits from banks 509.5 388.4 31.2%

Deposits customers 38,926.5 38,301.7 1.6%

Loans from banks and FIs 1,403.6 1,129.7 24.2%

Subordinated loan 413.0 416.4 -0.8%

Deferred tax liabilities 0.0 0.0

Other liabilities 1,431.5 1,102.0 29.9%

Total liabilities 42,684.1 41,338.3 3.3%

Total equity 5,458.6 6,240.8 -12.5%

Total liabilities and equity 48,142.7 47,579.1 1.2%

Banca Transilvania HQ8, G. Baritiu Street, Cluj-Napoca

400027, Romania

+ 40 264 407 150

+ 40 264 407 179 /FAX

[email protected]

www.bancatransilvania.ro/en/investor-relations

www.bancatransilvania.ro

www.bt24.ro

facebook.com/BancaTransilvania

twitter.com/b_Transilvania

linkedin.com/company/banca-transilvania#

BANCA TRANSILVANIA June 2016 Financial Results

Documents

Transcript of BANCA TRANSILVANIA June 2016 Financial Results