CRÉDITO REAL - investor...
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CRÉDITO REALCorporate Presentation
1Q19 Financial Update
Investor Relations+52 (55) 5340 5200 Ext. [email protected]
CONTACT INFORMATION
Renata González Muñoz+52 (55) 5228 [email protected]
INVESTOR PRESENTATION 1Q19
27
32
4
Stateswithin US
States within Mexico
Countries in Central America
67%
12%
11%
5%
3% 2%
Payroll Instacredit
SMEs Used Cars USA
Used Cars MX Other
$6.7
$10.4
$13.8
$17.6
$23.9
$26.7
$36.3
$38.3
2012 2013 2014 2015 2016 2017 2018 1Q19
2.4% 2.1%2.2% 1.7%NPL: 1.9%
5%
81%
13%
Total Loan Portfolio | MXN Bn+ A leading specialty finance company in Mexico with a growing
international presence (United States and Central America).
+ Highly recognized by its product offering, designed specifically forour customer base which is underserved by the traditional bankingsector.
+ Over 25 years of experience in understanding the credit profile ofcustomers and in developing and refining proprietary underwritingstandards.
+ Listed on the Mexican Stock Exchange since 2012, being actively apublic debt issuer in Mexico and in international bond-markets since1995 and 2010, respectively.
Notes:(1) Percentage of Loan Portfolio as of 1Q19.(2) Items converted using US$ 1 / Ps$ 19.3779 as of March 31, 2018.
(1)
Mexico
United States
Costa Rica
Panama
Nicaragua
Crédito Real in a Nutshell
(1)
(1)
Honduras
Market presence
Key Company Highlights Consistently Growing Loan Portfolio
Selected Financials
1.5% 1.6%
1
MXN Mn 2015 2016 2017 2018 1Q18 1Q19CAGR / Avg. 2015-2018
IncomeStatement
Financial Margin $3,312 $5,042 $5,773 $7,080 1,570 $1,765 28.8%
Net income $1,371 $1,714 $1,661 $1,955 422.7 $625 12.6%
Balance Sheet
Assets $25,996 $35,915 $42,238 $49,562 42,832 $50,839 24.0%
Debt $17,444 $24,589 $23,585 $30,647 24,233 $31,669 20.7%
Equity $6,713 $9,277 $14,768 $15,809 14,422 $16,044 33.0%
Key Ratios
ROAA 6.0% 5.0% 4.5% 4.2% 4.0% 5.0% 4.9%
ROAE 22.2% 20.2% 15.9% 12.9% 11.6% 15.7% 17.8%
Capitalization 38.1% 38.8% 50.9% 43.5% 46% 41.9% 42.8%
Efficiency 35.9% 55.2% 50.2% 42.4% 46.7% 42.0% 45.9%
1.6%
INVESTOR PRESENTATION 1Q19
2016+ Acquisition of 70% of Instacredit+ International bond issuance of 625
USD Mn due 2023, with a 7.25% semi-annual coupon
+ MSCI Mexico Small-Cap Index, FTSE Small Cap and IMC30
+ Ranking #48 at the Mexican Stock Market (BMV) Liquidity Index
1,163 2,118 3,159 3,391 3,7365,512
6,733
10,424
13,805
17,609
23,927
29,015
36,31938,277
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 1Q19
2007
2013
2015
2007+ Introduction of
Group loans+ Partnership with
Nexxus Capital Private Equity
2012+ Successful IPO in the Mexican Stock Exchange+ Introduction of SMEs
and Used car loans+ Acquires 49% of Crédito
Maestro (payroll loan distributor)
2014+ International bond issuance of
425 USD Mn due 2019, with a 7.5% semi-annual coupon
+ Crédito Real is part of the MSCI Mexico Small Cap Index
+ Acquisition of the remaining 51% of Kondinero
2015+ First issuance in the local market of
1,000 MXN Mn
+ Acquisition of 65% of AFS
Acceptance
+ Acquisition of 55.21% of Resuelve
2017+ First issuance for 800 MXN Mn
under securitization program+ Award for excellence in Corporate
Governance from Mexican Stock Exchange.+ First issuance of Subordinated Perpetual
Notes of 230 USD Mn
2018+ Issuance of 170 CHF
Mn unsecured non-callable bonds due2022.
+ Second Issuance for615 MXN Mn undersecuritization program
2010
+ International bond issuance
of 210 USD Mn due 2015
2011
+ Acquires 49% of Kondineroand 49% of
Credifiel (payroll loan
distributors)
2013+ New corporate
image development+ “One of the best
100 financial companies” distinction
Corporate History
2
Consolidated Loan Portfolio (MXN Mn)
2010
2018
2017
2019+ International Bond Issuance of 400 USD Mn due 2026, with a
9.5% semi-anual coupon
+ Distribution of a cash dividend payment ofMXN $0.70 per share to the shareholders; ; the highest dividend
paid in the history of the Company.
INVESTOR PRESENTATION 1Q19
Key Investment Highlights
1 2
3
+ Healthy loan portfolio with best-in-classasset quality
+ Unique, Flexible and Scalable Businessmodel focused on UnderservedSegments
+ Differentiated Distribution Platform toReach Clientele
SustainablePortfolio Growth
Focus onProfitability
QualifiedManagement and
CorporateGovernance
DiversifiedFunding Sources
+ Strong Balance with FundingFlexibility, Superior FinancialPerformance and Quality Growth
+ High Margin Growth that generatesvalue
+ Strong Bottom Line Growth
4
+ Strong Corporate Governance andExperienced Management Team
+ 50% Proportion of IndependentDirectors
+ Committees oriented Strenghten andPromote Ethics and Efficiency in ourOperations
+ Harnessing the Local andInternational Markets
+ Healthy Capital Structure
+ Strong Liquidity Profile with Diversifiedand Untapped Funding Sources
3
INVESTOR PRESENTATION 1Q19
Products
ProductsCompany’s Evolution
Payroll
Payroll-deducted loans to public employees and pensioners
SMEs
Non-revolving lines to fund working capital and investment activities, as well as leasing
Used Cars MX
Financing to individuals and legal entities through cars and commercial vehicle warranty
Used Cars US
Loans for used cars through strategic partners
Instacredit
Consumer Loans, Auto Loans, SMEs Loans and Home Equity Loans in Central America
Others
Integrated by Group Loans and Durable Goods
1
CAGR 33% in 8 years
Interest Income of Ps. 1,912Net Income of Ps. 416Equity of Ps. 1,460
Interest Income of Ps. 4,264Net Income of Ps. 1,371Equity of Ps. 6,713
Interest Income of Ps. 6,958Net Income of Ps. 1,714Equity of Ps. 9,277
Interest Income of Ps. 10,201Net Income of Ps. 1,955Equity of Ps. 15,809
100%
Mexico
82%
12%
6%Mexico
Central
AmericaUS
4
+ Profitable growth through our product diversification.
+ Sustained Double-digit growth rates.
67%
12%
3%
5%
12%
2%
INVESTOR PRESENTATION 1Q19
25%
Payroll
Ps. 62,419
44 months
52%
Product overview
Market Share
Payroll portfolio by sector
+ Personal loans granted mainly to unionized state and federal public-sector employees, retirees and pensioners
Bi-weekly
408,526
1.3%
Average term
Average annual interest rate
Payment frequency
CustomersAverage loan amount
Non-performing loan ratio
Origination and Collection Process
67%
35%
39%
14%
2%5%
4%
1% <1% Federal Education
IMSS
Government
Education Ministry
Health
State Education
Non-centralized agencies
Others
CollectionTrust
Loan disbursement
Agreements (+300)
Collection
Funding
DeductionCredit Applications(Salesforce +6,000)
Presence all over Mexico
50% Interest Income50% Risk Sharing
Government Agency
5
42%
11%11%1%
35%
Crédito Real
Consubanco
Alphacredit
Findep
Others
Source: Company estimates, based on AMDEN’s information. Filled with financial reports as of December2018
Payroll Portfolio ] 25,499.6 MXN Mn
INVESTOR PRESENTATION 1Q19
72%
52%
19%
28% 48% 81%
Employment % of GDP Financing
SMEs Corporations
SMEs and Used Cars MX
SMEs – Product overview
+ Providing financing sources to small and medium businesses for working capital requirements and investment activities as well as leasing
15%
Ps. 130,624
12 – 48 months
36%
Monthly
9,081
1.2%
Solid Growth in the portfolio Market Underserved in Mexico
1,368.51,746.1
3,676.7
2,358.4
4,420.1
0%
2%
4%
6%
8%
0
500
1,0 00
1,5 00
2,0 00
2,5 00
3,0 00
3,5 00
4,0 00
4,5 00
5,0 00
2016 2017 2018 1Q18 1Q19
Portfolio NPL
CAGR ‘15-’18: 64%
Source: INEGI
0.6%
1.6%
0.6%
1.4%
1.5%
1.4%
0.5% 0.5%0.4%
0.7%
0.3% 0.3%
1.2%
1.5%
1.5%
1.5% 1.6%
1.5%
1.6% 1.6% 1.7% 1.7% 1.6% 1.7% 1.7% 1.7%
1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19
Used Cars SectorSource: CNBV
+ Focused on financing semi-new and used cars through strategic alliances with a network of distributors that use their own sales force to promote our loans
Average term
Average annual interest rate
Payment frequency
CustomersAverage loan amount
Non-performing loan ratio
Ps. 7.5 million
3 – 36 months
19%
Monthly
591
0.9%
Used Cars MX – Product overview
+21 states
6
As of December, 2018
Attractive Low-Risk Business
INVESTOR PRESENTATION 1Q19
76%
16%
25%
Used Cars US
Ps. 240,543
66 months
21%
Product overview
Hispanics in the US
Portfolio Evolution
+ Commercial and financing business for used cars through our strategic alliances
Monthly
8,490
0.6%
5%
Headquarters
Source: Pew Research Center.
27 States 2,317.8
2,100.4
2,030.5 2,028.6 2,042.2
0%
1%
2%
3%
4%
1,8 50
1,9 00
1,9 50
2,0 00
2,0 50
2,1 00
2,1 50
2,2 00
2,2 50
2,3 00
2,3 50
2016 2017 2018 1Q18 1Q19
Portfolio NPL
Auction Upgrade car
Sale & Financing
✓ CreditAnalysis
Collection
Average term
Average annual interest rate
Payment frequency
CustomersAverage loan amount
Non-performing loan ratio
Origination and Collection Process
7
35.85.4
2.2
2.1
1.9
1.45.1
Mexicans
Puerto Ricans
Salvadorans
Cubans
Dominicans
Guatelmalans
Others
In millions
+ Biggest hispanic marketoutside Mexico with morethan 53 million people,which represents a bigopportunity to offer ourfinancial services in the US.
INVESTOR PRESENTATION 1Q19
184.1
82.8 83.3
51.4 58.440.5
89.3 76%
16%
50%
25%
Instacredit
Ps. 26,520
46 months
56%
Product overview
Geographic concentration by product
Portfolio by product
+ Consumer loans, SMEs loans, auto loans and mortgage loans granted in Costa Rica, Nicaragua and Panama
Monthly
169,282
4.8%
Domestic credit provided by Financial Sector (% of GDP)
12%
46 Branches
Products Personal Used Cars Small Business Home Equity
% Mix Portfolio 49% 37% 11% 3%
Customers 122,275 23,605 22,411 991
Avg. Loan Amount $827 $3,270 $1,048 $5,283
Avg. Term 39 months 49 months 39 months 57 months
Avg. Interest Rate 61% 49% 56% 52%
Source: World Bank as of 2017.
Attractive opportunities due to low creditpenetration
Average term
Average annual interest rate
Payment frequency
CustomersAverage loan amount
Non-performing loan ratio
13 Branches
5 Branches
8
53%46% 45%
51%
36%39%
49% 37%
9% 15%6%
9%3% 3%
Costa Rica Nicaragua Panama Instacredit
Home Equity
SMEs
Used Cars
Personal
INVESTOR PRESENTATION 1Q19
Market opportunity – Focused on Underserved Segments(1/2)
Market segments(1) Percentage of total population Players CREAL(2)
A and B
(1) Market segments are defined based on monthly family income, in accordance with the categories established by AMAI: Segment E, fromPs.0.00 to Ps.2,699; Segment D, from Ps.2,700 to Ps.6,799; Segment C, from Ps.11,600 to Ps.34,999, Segment C+, from Ps.35,000 to Ps.84,999,Segment A and B, from Ps.85,000 or more.
(2) The market segments of Instacredit, Don Carro and Crédito Real USA are defined based on their average loan amount as of 3Q18.
Target Market
83%
17%
D and E
C & C-
C+
A & B
6%
11%
27%
56%
9
2017 Total Population: 129.2 million
INVESTOR PRESENTATION 1Q19
51.0
96.3
59.5
43.5
82.3
17.5 19.5
93.1 93.8
70.0
45.8
74.3
48.736.9
U Sp B Co Ch A M
(%)
Credit to Private Non-Financial Sector by Banks
% of the Population with an Account in a Financial Institution
Market opportunity – Focused on Underserved Segments(2/2)
A & B
C & C-
C+
D & E
Banking penetration(2)Sector
25%
57%
83%
96%
Target Market
Traditional Banks Crédito Real
Customers walking intobranches
Competing with distributorswith a loan portfolio and a
regional presence
Focus on high incomepopulation with high credit
penetration
Standard credit analysisfocused on mid and high
income segments
Customer approach on siteTrain and develop salesforce
Invest in a partnershipEstablish a strategic Alliance
Exclusivity agreements
Expert and parametric creditanalysis developed according
to the segment.
Focus on middle and lowincome population with low
credit penetration
Source: CNBV, ENIF, BCRA, BCRB, SBIF, SBS, Superfinanciera de Colombia, IMF and World Bank.Note: Serving an underpenetrated market date reported as of 2017. Bancarization reported as of 2013.(1) US show figures as of 2016,(2) Population utilizing banking services. Income level by bracket (approximate annual amount in US$): “A/B” +108,400; “C+” 76,500; “Cm/C” 29,700; “D” 8,900; “E” 3,400.
Differentiators
10
192.2
105.7
59.7 49.4
112.6
16.1
35.5
19.0 11.7 15.4 13.4 14.00.2 5.7
U Sp B Co Ch A M
(%)
Credit Penetration to Private Sector as of % of GDP
Consumer Loan Penetration as of % of GDP
INVESTOR PRESENTATION 1Q19
ProductKey
Subsidiaries OwnershipDistribution Network Annual Interest Rate Customers
Avg. Loan Amount (Ps$) Strategy Yield 2022
PAYROLL14 distributors+6,000 reps
52% 408,526 62,419Pensioners market development
Focus on federal-level employees35%
INSTACREDIT
46 branches in Costa Rica
18 branches in Nicaragua and
Panama
56% 169,282 26,520
Efficiency in funding cost and general expenses
Improvement in asset quality
Expansion in Central America
60%
USED CARS MX
20 branchesand agreementswith 89 agenciesin 21 States of
Mexico
36% 9,081 130,624
Drive & Cash expansion
Enlarge dealers network
Increase competitive positioning
30%
USED CARS US
Two strategicalliances with
one Branch and +830 distributors
in the US
21% 8,490 240,543
Grow dealers network
New Credito Real USA brand, merger of Don Carro and CR USA Finance,
Coupled with the enhancement in servicing and collection
30%
SMEs Alliance withFondo H
19% 591 7.5 million
Increase origination through brokers
Diversification of Fondo H portfolio
Define new products sized for our clients
Leasing and factoring
20%
Average yield >35%
PerformanceExpected ROA: > 4.5%Expected ROE: > 20%
>5%
Current businesses growth strategy
100%
49%
49%
70%
51%
80%
99%
11
INVESTOR PRESENTATION 1Q19
Risk-return view(1)
Solid capital base(2)
Avg.3.0%
Delivering bottom-line results (ROAA)(3)
Source: Credito Real Research and last updated information filed with BMV – Bolsa Mexicana de Valores. Information as of 1Q19, except Alphacredit, Consubanco, and Unifin which show figures as of 2018.
Notes:(1) ROAE = 1Q19 Net Income / Average Stockholders’ Equity between 1Q19 and 4Q18(2) Capitalization Ratio = 1Q19 Stockholders’ Equity / 1Q19 Total Loan Portfolio(3) ROAA = 1Q19 Net Income / Average Assets between 1Q19 and 4Q18.
Profitability – Defensive Competitive Positioning
Avg.35.4%
2
12
0.9
2.5
1.4
3.1
5.0
2.1
6.7
2.8 2.6 2.8 3.0
26.5
17.0 19.1
53.7
41.9
51.9 53.358.3
23.916.8
27.0
Alphacredit
BanBajio
Santander CAME
Consubanco
Crédito Real
Independencia
FonacotGentera
Inbursa
Banorte
BanRegio
Unifin
Banco Azteca
0
5
10
15
20
25
0.0 1.0 2.0 3.0 4.0 5.0 6.0
1Q
19
RO
E (%
)
1Q19 NPLs (%)
INVESTOR PRESENTATION 1Q19
Peer-superior asset quality
Improving levels of NPL while maintaining healthy reserves(1)
1.9% 2.4% 2.2% 2.1% 1.7%
1.9% 1.6%
3.0% 2.8%
3.2% 3.7%
2.9%
3.4% 3.4%
2014 2015 2016 2017 2018 1Q18 1Q19
NPL Ratio Reserves / Total loan portfolio
30.4%
63.8%
28.2%31.0%
24.3%14.2%
Total Instacredit Payroll Used CarsMX
Used Cars US SMEs
1.6%1.3%
0.8% 0.9%
4.8%
1.9%
2.8%
1.7% 1.7% 1.8%
Total Payroll Used Cars SMEs Instacredit
Credito Real Banking Sector
Average Yield Breakdown by Product NPL Breakdown by Product(2)
Source: Company filings, CNBV, SUGEF(1) Reserves calculated as end of period allowance for loan losses divided by total loan portfolio.(2) Average LTM as of February 2019.
13
+ Below the banking sector in most of our products
INVESTOR PRESENTATION 1Q19
76%50%
25%
Key financial performance
Interest Income
Net Income
Loan Portfolio
Financial Margin
23,927
29,015
36,319
31,356
38,277
0.0%
2.0%
4.0%
6.0%
0
10,000
20,000
30,000
40,000
2016 2017 2018 1Q18 1Q19
Loan Portfolio NPL
YoY Growth: 22%CAGR ’16–’18: 23%
6,665
8,463
10,201
2,3102,830
28.0%
30.0%
32.0%
34.0%
0
2,000
4,000
6,000
8,000
10,000
2016 2017 2018 1Q18 1Q19
Interest Income Yield
CAGR ’16–’18: 24%
5,042
5,773
7,080
1,570 1,765
12.0%
16.0%
20.0%
24.0%
28.0%
0
2,000
4,000
6,000
2016 2017 2018 1Q18 1Q19
Net Interest Income NIM NIM after provisions
CAGR ’16–’18: 19%
1,714 1,661
1,955
423625
470
0
500
1,000
1,500
2,000
2016 2017 2018 1Q18 1Q19
CAGR ’16–’18: 7%
YoY Growth: 48%YoY Growth: 12%
YoY Growth: 23%
14
Adjusted for thenon-recurringeffect(1)
(1) Adjusted for the Ps. 220 million gain from the derivatives unwinding of the Senior Notes due 2019.
INVESTOR PRESENTATION 1Q19
16%
50%
25%
Key financial measures
Efficiency
ROAE
Capitalization
ROAA
38.1% 36.4%31.9%
32.6%30.9%
50.9%
43.5%46.0%
41.9%
2016 2017 2018 1Q18 1Q19
Excluding Subordinated
Perpetual Notes 49.9% 50.2%
42.4%46.7%
42.0%
2016 2017 2018 1Q18 1Q19
5.0%4.5%
4.2%4.0%
5.0%
2016 2017 2018 1Q18 1Q19
18.4%
15.9%
12.9%11.6%
15.7%
17.6% 17.9%
15.8%
21.3%
2016 2017 2018 1Q18 1Q19
15
Excluding Subordinated
Perpetual Notes
(1) Adjusted for the Ps. 220 million gain from the derivatives unwinding of the Senior Notes due 2019.
11.9% Adjustedfor the non-recurring effect(1)
3.7% Adjustedfor the non-recurring effect(1)
INVESTOR PRESENTATION 1Q19
64%
36%
Short Term
Long Term
100%53%
47%
Secured
Unsecured
14%
86%
83%
17%
Drawn
Undrawn
Funding sources
Consolidated Debt Status
44%
19%
3%
25%
9%
Senior Notes
Credit Lines
Securitizations
Equity
Hybrid
31.6%(1)
Capital Structure
Cost of funds
Market risks
Interest Rate Risk 54.4% of Credito Real‘s consolidated debt is fixed
Asset & Liabilities duration Assets Liabilities
1.7 years 3.9 years
Assets in USD: +100 million
Drawn vs. Undrawn
Secured vs. Unsecured
Term
100%
Credit Lines100% = $12,567
Securitizations100% = $10,000
Credit Lines100% = $9,472
Credit Lines100% = $9,472
Securitizations100% = $1,415
Securitizations100% = $1,415
3
(1) Hybrid plus Equity as percentage of total Assets(2) Short term refers to amortization under 1 year. Long term ranges from 1 to 5 years.
MXN Mn
16
4.5%7.0% 8.0% 7.7% 8.5%
3.7%
4.4% 3.1% 2.8%
5.2%
2016 2017 2018 1Q18 1Q19
Spread
Average TIIE11.4% 11.1%
10.5%
8.2%
Adjusted Capitalization | 47,712.9 MXN Mn
13.7%
INVESTOR PRESENTATION 1Q19
Debt Profile
$11,842
$7,701
$3,405$4,324
$3,563
$894
$328
$364
$22
$284
$472
$449
$188
$4,207
2019 2020 2021 2022 2023 2026
Senior Notes Swiss Bond Credit Lines Securitization Subordinated Notes
67%
22%
11%
USD
MXN
CHF
Debt by currency
SN 2010BB-
SN 2019BB
PerpetualNotesB+BB-
SN 2023BB+
Swiss Bond 2022BB+
17
SN 2026BB+
(1) All the figures represent only the notional and exclude accrued interests and mark-to-market of hedges. Debt converted using US$ 1 / Ps$ 19.3779 as of March 31, 2019.
BB+ BB+ BBB-
Global Scale
Negative Stable Stable
+ Comfortable debt maturity profile for the next 3 years
INVESTOR PRESENTATION 1Q19
Strong Corporate Governance and Experienced Management Team
Robust standards of corporate governance
Well-respected
shareholders driving the business
+ Listed on Mexican stock exchange (BMV:CREAL*) with a market cap of ~380 USD Mn(1)
+ Founding members well-known and reputable in the Mexican business community (founders of leading manufacturer in the Americas, MABE)
+ Our management have a proven expertise on the sector
+ 50% of Credito Real’s Board is integrated by independent members
Shareholder Structure
Ángel Romanos
CEO
25 years in CR
Carlos Ochoa
Co-CEO / CFO
22 years in CR
Luis Carlos Aguilar
Commercial Officer
for Payroll Loans
23 years in CR
Jose Juan González
COO
10 years in CR
Luis Magallanes
CMO
6 years in CR
Claudia Jolly
General Treasurer
21 years in CR
Luis Calixto López
General Counsel
18 years in CR
Adalberto Robles
Human Resources
Officer
11 years in CR
Luis Berrondo
M&A Officer
4 years in CR
Pablo Bustamante
Controller
3 years in CR
Felipe Guelfi
Project Officer
3 years in CR
Hector Huelgas
Internal Audit Officer
3 years in CR
EthicsCommittee
SecuritiesTransactionsCommittee
ExecutiveCommittee
Communicationand Control Committee
68%
25%
7%Float
Berrondo
Family
Saiz Family
4
Management team
Key Committees
AuditCommittee
CorporatePracticesCommittee
Governance Highlights
(1) As of April, 2019
CNBV Supervision
18
Appendix
INVESTOR PRESENTATION 1Q19
Profit & Loss
MXN Mn 1Q19 1Q18 % Var.1Q19 (USD)
4Q18 % Var.
Interest Income 2,830.4 2,309.8 22.5 146.1 2,735.4 3.5
Interest Expense (1,065.8) (739.8) 44.1 (55.0) (692.0) 54.0
Financial Margin 1,764.5 1,570.1 12.4 91.1 2,043.4 (13.6)
Provision for Loan Losses (385.7) (421.4) (8.5) (19.9) (452.4) (14.8)
Adjusted Financial Margin 1,378.8 1,148.6 20.0 71.2 1,591.0 (13.3)
Commissions and Fees Collected 134.8 182.1 (26.0) 7.0 0.2 -
Commissions and Fees Paid (85.6) (67.8) 26.2 (4.4) (78.2) 9.5
Intermediation Income 257.4 83.6 - 13.3 (101.9) -
Other Income from Operations 79.5 62.9 26.4 4.1 94.4 (15.8)
Administrative and Promotion Expenses (854.1) (856.3) (0.3) (44.1) (778.7) 9.7
Operating Result 910.9 553.1 64.7 47.0 726.8 25.3
Income Taxes (265.1) (129.3) - (13.7) (213.1) 24.4
Income before participation in the results of subsidiaries 645.8 423.9 52.4 33.3 513.8 25.7
Participation in the results of Subsidiaries, Associates and Non-controlling participation
(21.2) (1.2) - (1.1) 54.3 -
Net Income 624.6 422.7 47.8 32.2 568.1 10.0
19
INVESTOR PRESENTATION 1Q19
Balance SheetMXN Mn 1Q19 1Q18
%
Var. 1Q19 (USD) 4Q18 % Var.
Cash and Cash Equivalents 410.4 345.9 18.7 21.2 1,106.3 (62.9)
Investments in Securities 1,120.6 1,004.6 11.5 57.8 410.3 -
Securities and Derivatives transactions 83.2 776.6 (89.3) 4.3 1,028.0 (91.9)
Total Performing Loan Portfolio 37,648.3 30,768.3 22.4 1,942.8 35,701.6 5.5
Total Non-performing Loan Portfolio 629.1 587.6 7.1 32.5 617.6 1.9
Loan Portfolio 38,277.4 31,355.9 22.1 1,975.3 36,319.1 5.4
Less: Allowance for loan losses 1,308.0 1,076.1 21.5 67.5 1,067.9 22.5
Loan Portfolio (net) 36,969.4 30,279.8 22.1 1,907.8 35,251.2 4.9
Other Accounts Receivable (net) 5,412.9 4,688.8 15.4 279.3 5,389.3 0.4
Foreclosed Assets (net) 18.2 - - 0.9 - -
Property, Furniture and Fixtures (net) 767.0 327.6 - 39.6 341.5 -
Long-term investments in shares 1,166.0 1,275.9 (8.6) 60.2 1,193.4 (2.3)
Deferred Taxes (net) - - - - - -
Debt insurance costs, intangibles and others 4,891.5 4,132.8 18.4 252.4 4,842.5 1.0
Total Assets 50,839.2 42,832.0 18.7 2,623.6 49,562.5 2.6
Notes Payable (Securitizations) 1,363.9 3,794.1 (64.1) 70.4 1,415.0 (3.6)
Senior Notes Payable 21,227.3 14,309.6 48.3 1,095.4 17,084.2 24.3
Bank Loans Short-term 5,111.0 1,216.4 - 263.8 7,342.9 (30.4)
Bank Loans Long-term 3,966.6 4,913.0 (19.3) 204.7 4,804.7 (17.4)
Total Bank Loans 9,077.6 6,129.4 48.1 468.5 12,147.6 (25.3)
Total Debt 31,668.8 24,233.1 30.7 1,634.3 30,646.7 3.3
Income Taxes Payable 339.7 336.2 1.0 17.5 390.7 (13.0)
Securities and Derivative transactions - 1,278.2 - - - -
Other Accounts Payable 1,039.5 1,130.9 (8.1) 53.6 1,078.6 (3.6)
Deferred Taxes 1,747.2 1,431.7 22.0 90.2 1,637.6 6.7
Total Liabilities 34,795.2 28,410.0 22.5 1,795.6 33,753.6 3.1
Capital Stock 1,845.9 2,131.0 (13.4) 95.3 2,067.7 (10.7)
Perpetual Notes 4,206.7 4,206.7 - 217.1 4,206.7 (0.0)
Accumulated results from prior years 8,654.1 7,225.0 19.8 446.6 6,572.1 31.7
Result from valuation of Cash Flow hedges, net (137.9) (181.1) - (7.1) 128.6 -
Cumulative translation adjustment (85.2) (137.6) (38.1) (4.4) (30.1) -
Controlling position in Subsidiaries 935.8 755.3 23.9 48.3 908.5 3.0
Net Income 624.6 422.7 47.8 32.2 1,955.4 (68.1)
Total Stockholders’ Equity 16,044.0 14,422.0 11.2 828.0 15,808.8 1.5
Total Liabilities and Stockholders’ Equity 50,839.2 42,832.0 18.7 2,623.6 49,562.5 2.6
20
INVESTOR PRESENTATION 1Q19
Financial Ratios
1Q19 1Q18 % Var. 4Q18 % Var.
Yield 30.4% 30.6% (0.3) 30.7% (0.4)
Net Interest Margin 18.9% 20.8% (1.9) 22.9% (4.0)
Return on Average Loan Portfolio 6.7% 5.6% 1.1 6.4% 0.3
ROAA: Return on Average Assets 5.0% 4.0% 1.0 4.7% 0.3
ROAE: Return on Average Stockholders’ Equity 15.7% 11.6% 4.1 14.6% 1.1
ROAE: Return on Average Stockholders’ Equity (excluding Perpetual Notes) 21.3% 15.8% 5.5 20.0% 1.3
Debt to Equity Ratio 2.0x 1.7x 0.3 1.9x 0.1
Debt to Equity Ratio (excluding Perpetual Notes) 2.7x 2.4x 0.3 2.6x 0.1
Average cost of funds 13.7% 10.5% 3.2 12.0% 1.7
Efficiency Ratio 42.0% 46.7% (4.7) 34.6% 7.4
Capitalization Ratio 41.9% 46.0% (4.1) 43.5% (1.6)
Capitalization Ratio (excluding Perpetual Notes) 30.9% 32.6% (1.7) 31.9% (1.0)
Provisions for loan losses as a percentage of total loan portfolio 4.0% 5.3% (1.3) 5.0% (1.0)
Allowance for loan losses as a percentage of total past-due loan portfolio 207.9% 183.1% 24.8 172.9% 35.0
Total past-due loan portfolio as a percentage of total loan portfolio 1.6% 1.9% (0.2) 1.7% (0.1)
21
Disclaimer
Crédito Real is a leading financial institution in Mexico, with presence in the United States, CostaRica, Panama, Nicaragua and Honduras, focusing on consumer lending with a diversified businessplatform in the following main lines of business: payroll loans, small business loans, used car loans,consumer loans through Instacredit and group loans. Credito Real offers its products mainly to lowand middle-income segments of the population that have historically been underserved by otherfinancial institutions. The Company’s stock is listed on the Mexican Stock Exchange under the tickersymbol “CREAL*”. (Bloomberg identification number is CREAL*:MF)
This presentation does not constitute or form part of any offer or invitation for sale orsubscription of or solicitation or invitation of any offer to buy or subscribe for any securities, nor shallit or any part of it form the basis of or be relied on in connection with any contract or commitmentwhatsoever.
This presentation contains statements that constitute forward-looking statements which involve risksand uncertainties. These statements include descriptions regarding the intent, belief or currentexpectations of the Company or its officers with respect to the consolidated results of operations andfinancial condition, and future events and plans of the Company. These statements can be recognizedby the use of words such as “expects,” “plans,” “will,” “estimates,” “projects,” or words of similarmeaning. Such forward-looking statements are not guarantees of future performance and actualresults may differ from those in the forward-looking statements as a result of various factors andassumptions. You are cautioned not to place undue reliance on these forward looking statements,which are based on the current view of the management of the Company on future events. TheCompany does not undertake to revise forward-looking statements to reflect future events orcircumstances.
About Credito Real