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Clasificare BT: Uz Intern

BANCA TRANSILVANIA

Q3 2018 financial results

November 15th 2018


Disclaimer

The information contained in the present document has not been independently verified and norepresentation or warranty expressed or implied is made as to, and no reliance should be placedon the fairness, accuracy, completeness or correctness of this information or opinions containedherein.

Banca Transilvania cautions readers that no forward-looking statement that may be contained inthe present document is a guarantee of future performance and that actual results could differmaterially from those contained in the forward-looking statements. Forward-looking statementsspeak only as of the date they are made, and Banca Transilvania undertakes no obligation toupdate 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 anyliability for any loss howsoever arising from any use of this document or its content or otherwisearising in connection with this document.

The present document does not constitute a public offer under any applicable legislation or anoffer to sell or solicitation of any offer to buy any securities or financial instruments or any adviceor recommendation with respect to such securities or other financial instruments.


Banking sector dynamics

Q3 2018 Highlights

Performance in Q3 2018

Overview of business lines

BT Financial Group

Financial statements

1

2

3

4

5

a

Agenda

2


342354

366 362 364377

394

428435

10000%

15000%

20000%

25000%

30000%

35000%

40000%

45000%

50000%

10 11 12 13 14 15 16 17 Jun-18

total bank net assets, RONbn source: NBR

16.2

%

15.7

%

13.5

%

13.5

%

11.3

%

10.0

%

9.6

%

9.4

%

8.3

%

8.0

0%

6.4

%

6.2

%

5.7

%

2Q15 4Q15 2Q16 4Q16 2Q17 4Q17 2Q18

NPE ratio (EBA), % source: NBR

Bank assets rose 1.6% YTD as of Jun end

Loan quality further improving, NPE ratio drops below 6%

Banking sector dynamics Q3 2018 Highlights Performance in Q3 2018 Overview of business lines BT Financial Group

Bank assets continued to expand during 1H18 reaching RON 435bn as credit activity gathers pace

3


6.17.4 7.4 7.8 7.9

6.5 6.85.9

7.2 7.7 8.1 8.3 7.83.2

-1.4 -1.7 -2.1-0.9 -0.7

0.1 1.2

2.2 1.63.2 3.5 3.6

-2.9

-0.6 -0.7

-4.3 -5.6

-3.2

-0.5

2.3

6.6

2.52.1

3.73.4

-10

-5

0

5

10

15

20

3Q15 1Q16 3Q16 1Q17 3Q17 1Q18 3Q18

YoY, RONbn source: NBR

non-financial corporate loans

financial corporate (excl. MFIs) loans

household - other loans

household - consumer credit

household - housing loans

Private loans expanding at a fast pace Housing loans remain the main driver of credit growth


4

0.6

%

3.0

%

2.8

%

1.16

%

1.17

%

1.2

4%

3.1

%

4.4

%

7.4

%

5.7

% 6.1

%

6.8

%

6.3

%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

3Q15 1Q16 3Q16 1Q17 3Q17 1Q18 3Q18

%YoY source: NBR

Lending up 6.3% YoY to RON 248bn end of Q3’18


7782

85 85

93

110

126

146

162

132

141 141

133

119

107

94

87 86

0%

2000%

4000%

6000%

8000%

10000%

12000%

14000%

16000%

10 11 12 13 14 15 16 17 Sep-18

RONbn source: NBR

RO

N l

oa

ns

FC

Y l

oa

ns

78%

65%

86%

60%

22%

35%

14%

40%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

household -consumer

credit

household -housing loans

household -other loans

non-financialcorporate loans

structure by currency as of Sepsource: NBR

RO

N l

oa

ns

FC

Y l

oa

ns

LCY loans more than double compared to 2010

All types of credit are now mostly RON denominated

Local currency loans at RON 162bn make up 2/3 of the private credit


5


The real economy & investment cycle

Economy Q3 2018 Highlights Performance in Q3 2018 Overview of business lines BT Financial Group

6

Evolution around the potential pace Deterioration of the current account

-10

-8

-6

-4

-2

0

2

4

6

8

10

12

3Q

05

1Q0

63

Q0

61Q

07

3Q

07

1Q0

83

Q0

81Q

09

3Q

09

1Q10

3Q

101Q

113

Q11

1Q12

3Q

121Q

133

Q13

1Q14

3Q

141Q

153

Q15

1Q16

3Q

161Q

173

Q 1

71Q

18

3Q

18

GDP (%, YoY) source: Statistics Office

-25

-20

-15

-10

-5

0

5

3Q

08

1Q 0

9

3Q

09

1Q 1

0

3Q

10

1Q 1

1

3Q

11

1Q 1

2

3Q

12

1Q 1

3

3Q

13

1Q 1

4

3Q

14

1Q 1

5

3Q

15

1Q 1

6

3Q

16

1Q 1

7

3Q

17

1Q 1

8

3Q

18

Current account deficit (EUR bn, TTM) source: NBR


The financial economyInflationary pressures fading out gradually, while EUR/RON resilient tothe volatility on the global markets

Economy Q3 2018 Highlights Performance in Q3 2018 Overview of business lines BT Financial Group

7

Inflation changed the trend EUR/RON stability

-4

-2

0

2

4

6

8

Jan

-13

Ap

r-1

3Ju

l-13

Oct

-13

Jan

-14

Ap

r-1

4Ju

l-14

Oct

-14

Jan

-15

Ap

r-1

5Ju

l-15

Oct

-15

Jan

-16

Ap

r-1

6Ju

l-1

6O

ct-1

6Ja

n-1

7A

pr-

17

Jul-

17O

ct-1

7Ja

n-1

8A

pr-

18

Jul-

18O

ct-1

8

CPI (%, YoY) source: Statistics Office

4.5

4.6

4.6

4.7

4.7

4.8

4.8

No

v-17

Dec

-17

Jan

-18

Feb

-18

Mar

-18

Ap

r-1

8

May

-18

Jun

-18

Jul-

18

Au

g-18

Sep

-18

Oct

-18

EUR/RON source: NBR

Clasificare BT: Uz InternBanking sector dynamics Q3 2018 Highlights Performance in Q3 2018 Overview of business lines BT Financial Group

Banca Transilvania’s

business development and

financial performance in Q3 2018


*without POCI adjustments

Q3 2018 BT Highlights


9

pr

ofi

tab

ilit

y

YTD Sep 2018 YTD Sep 2017 ∆

Net interest income RONmn 1,562.9 1,320.3 18.4%

Net fee and commission income RONmn 466.7 424.3 10.0%

Operating expenses RONmn (1,053.3) (957.6) 10.0%

Gross profit before provisions RONmn 1,189.2 959.6 23.9%

Net income RONmn 979.1 779.8 25.5%

Cost of risk, net (%) -0.32% 0.16%

NIM* 3.54% 3.19% 0.3 pp

ROE 19.00% 16.68% 2.3 pp

Cost-to-income ratio 46.97% 49.95% -3.0 pp

cr

ed

it

ac

tiv

ity

Sep-18 Dec-17 ∆

Gross loans to customers RONmn 34,690.5 31,828.3 9.0%

Deposits from customers RONmn 52,384.2 49,099.2 6.7%

Gross loans-to-deposits ratio 66.22% 64.82% 1.4 pp

NPL ratio 3.13% 3.05% 0.1 pp

ca

pit

al Sep-18 Dec-17 ∆

Total equity RONmn 7,175.9 6,970.1 3.0%

Tier 1 capital ratio (profit included) 18.81% 18.25% 3.1%

Total capital ratio (profit included) 23.16% 19.21% 20.5%


Business performance Q3 2018at a glance

10

Total assets at RON 64.7bn Balance sheet consolidation

Capital adequacy ratio at 23.16%

Strong capital base, supporting organic and non organic growth

Net fees and commissions at RON 467mn +10% Y/Y

Increased number of operations and additional cross-sell

CoR, net CoR at -0.32%, recoveries and releases are higher than provision expenses

Net profit at RON 979mn

Net profit positively influenced by increase in interest income, fees and commissions income and decrease in provisions

Cost/income at 46.97% Operational efficiency closely monitored



Trends in income structureRONmn

11

958

162

424

1,320

1,053

176

467

1,563

Net trading incomeNet fee and commission income

+10.0%

+9.0%

+10.0%

+18.4%

Operating expensesNet interest income

YTD Sep 2018

YTD Sep 2017



Loan structure

12

Loans to households, RONbn

8.2 8.7

8.49.3

Sep’18

18.00.1

Dec’17

16.70.0

Other ConsumptionHousing

10.7 11.7

4.34.9

Sep’18

16.6

Dec’17

15.0

Large corporatesSMEs

22%78%

RON FX

20%80%

RON FX

*SMEs identified according to internal classification rules

Loans to companies, RONbn


Deposit structure

13

19.1 20.6

11.313.8

34.4

Sep’18Dec’17

30.4

Current accounts Deposits

11.09.6

7.78.4

Dec’17

18.7 18.0

Sep’18

Large corporatesSMEs

46%54%

FXRON

28%72%

FXRON

Deposits from households, RONbn Deposits from companies, RONbn

*SMEs identified according to internal classification rules



NPL ratio at 3.13%Banca Transilvania continued to provide a sound coverage ratio for its PAR 90 portfolio

14

33%

45%46% 40%

54%46%

2013

122%

77% 78%

46%

119%

73%

127%

2017

49%

2016

117%

74%

43%

2015

119%

79%

40%

2014

127%

81%

45%

Sep’ 2018

NPL coverage with mortgage collaterals NPL coverage with provisions



Retail bankingretail loan portfolio reached RON 18bn as of Sep 2018

15

60,000 non-card retail loans disbursed in

the first nine months of 2018

3.2 mn active cards, with a market share of

about 19%

The Bank manages a portfolio of 410.000

credit cards, representing 30% of the

Romanian retail card transactions.

BT Pay- first bank wallet in Romania – has

over 180.000 downloads; A 33% increase

compared to Q2 2018 for mobile-phone

transactions and money transfers.

10.3

18.0

16.7

15.1

7.56.8

3.3

13.6

20162015 201720142013 Sep-18

Retail loansLoans transferred from VBRO

0.2

Loans transferred from Bancpost


SME bankingSME loan portfolio at RON 4.9bn and 252,400 active clients


16

• First non-banking solutions platform for

SMEs, BT Store

• Banca Transilvania continued its specific

focus on the SME business sector, offering

more than 15,000 new loans in the first nine

months of 20182.8

4.9

4.3

3.2

2.62.5

0.3

20172016 Sep-182013 2015

3.1

2014

SME loansLoans transferred form VBRO


Corporate bankingcorporate loan portfolio reached RON 11.7bn


17

• Sectorial specialization is a main focus

• BT is present with lending facilities

especially in the industrial manufacturing

and agribusiness segments

• Joint actions BT and Bp to ensure common

clients customized approach

10.1

11.7

10.711.1

10.09.90.9

2017

11.0

20142013 2015 2016 Sep’18

Loans transferred form VBRO Corporate loans


Total assets: RON 3.5bn

AuM: RON 3,824mn

Total assets: RON 906mn

*Total assets for Bancpost are computed under IFRS;Total assets for Victoriabank are computed under local FINREP standards, at official MDL/RON exchange rate as at 30.09.2018;Total assets for subsidiaries other than banks are presented under RAS rules.


Banca Transilvania Financial Groupas of 30.09.2018*


18






H1 2018 Highlights – consolidated figures

19

pr

ofi

tab

ilit

y

YTD Sep 2018 YTD Sep 2017 ∆

Net interest income RONmn 2,089.6 1,379.0 51.5%

Net fee and commission income RONmn 569.2 458.8 24.1%

Operating expenses RONmn (1,587.3) (1,056.2) 50.3%

Gross profit before provisions RONmn 1,668.6 1,033.5 61.5%

Net profit RONmn 1,241.1 829.5 49.6%

EPS RON 0.2553 0.1729 47.7%

Cost of risk, net (%) 0.34% 0.23% 49.2%

NIM* 3.99% 3.30% 20.9%

ROE 22.65% 17.07% 32.7%

Cost-to-income ratio 48.75% 50.54% -3.5%

cr

ed

it

ac

tiv

ity Sep-18 Dec-17 ∆

Gross loans to customers RONmn 40,889.4 32,120.7 27.3%

Deposits from customers RONmn 62,787.9 48,932.2 28.3%

Gross loans-to-deposits ratio 65.12% 65.64% -0.8%

ca

pit

al

Sep-18 Dec-17 ∆

Total equity RONmn 7,542.2 7,125.4 5.8%

Tier 1 capital ratio (profit included) 16.31% 18.37% -11.2%

Total capital ratio (profit included) 19.92% 19.31% 3.2%

*without POCI adjustments


annex Iincome statement YTD Sep 2018 – individual figures


20

IFRS individual, RONmn YTD Sep 2018 YTD Sep 2017 ∆

Net interest income 1,562.9 1,320.3 18.4%

Net fee and commission income 466.7 424.3 10.0%

Net trading income 176.5 162.0 9.0%

Other net income 36.5 10.7 240.6%

Operating income 2,242.5 1,917.2 17.0%

Personnel expenses (584.2) (528.3) 10.6%

D&A (80.2) (64.8) 23.8%

Other operating expenses (388.9) (364.5) 6.7%

Operating expenses (1,053.3) (957.6) 10.0%

Cost of risk 84.3 (37.8)

Net income before taxation 1,273.4 921.9 38.1%

Income tax (expense) / revenue (294.4) (142.0) 107.3%

Net income after taxation 979.1 779.8 25.5%


annex IIbalance sheet 30.09.2018 – individual figures


21

IFRS individual, RONmn Sep 2018 Dec 2017 ∆

Cash & cash equivalents 6,204.0 6,637.7 -6.5%

Placements with banks 4,133.7 5,302.3 -22.0%

Loans to customers, net 32,510.6 29,914.0 8.7%

T-bills & securities 19,478.8 16,115.7 20.9%

Fixed assets 583.2 533.4 9.3%

Participations 1,183.8 156.6 655.8%

Current tax assets 22.9 148.6 -84.6%

Deferred tax assets 32.2 173.2 -81.4%

Other financial assets 429.3 211.9 102.6%

Other assets 108.2 108.5 -0.3%

Total assets 64,686.9 59,302.1 9.1%

Deposits from banks 161.9 127.9 26.5%

Deposits customers 52,384.2 49,099.2 6.7%

Loans from banks and FIs 1,535.1 1,099.9 39.6%

Subordinated loan 1,759.0 414.6 324.3%

Provisions for other risks and charges 317.0 373.1 -15.0%

Other financial liabilities 1,294.0 1,154.8 12.1%

Other liabilities 59.8 62.4 -4.2%

Total liabilities 57,511.1 52,332.0 9.9%

Shareholders’ equity 7,175.9 6,970.1 3.0%


annex IIIincome statement YTD Sep 2018 – consolidated figures


22

IFRS consolidated, RONmn YTD Sep 2018 YTD Sep 2017 ∆

Net interest income 2,089.6 1,379.0 51.5%

Net fee and commission income 569.2 458.8 24.1%

Net trading income 169.9 204.9 -17.1%

Other net income 427.2 47.0 809.8%

Operating income 3,255.9 2,089.7 55.8%

Personnel expenses (732.7) (560.8) 30.7%

D&A (121.4) (89.9) 35.1%

Other operating expenses (733.2) (405.5) 80.8%

Operating expenses (1,587.3) (1,056.2) 50.3%

Cost of risk (103.3) (53.9) 91.6%

Bargaining gain 110.8 0.0

Net income before taxation 1,676.1 979.6 71.1%

Income tax (expense) / revenue (435.0) (150.1) 189.9%

Net income after taxation 1,241.1 829.5 49.6%


annex IVbalance sheet 30.09.2018 – consolidated figures


23

IFRS consolidated, RONmn Sep 2018 Dec 2017 ∆

Cash & cash equivalents 8,823.7 6,637.7 32.9%

Placements with banks 5,301.6 5,348.1 -0.9%

Loans to customers, net 38,433.4 30,249.0 27.1%

T-bills & securities 22,076.8 16,096.2 37.2%

Fixed assets 805.0 766.9 5.0%

Current tax assets 0.0 146.9 -100.0%

Deferred tax assets 73.5 187.1 -60.7%

Other financial assets 791.6 234.3 237.8%

Other assets 246.1 138.8 77.3%

Total assets 76,551.7 59,805.0 28.0%

Deposits from banks 282.6 127.9 120.9%

Deposits from customers 62,787.9 48,932.2 28.3%

Loans from banks and FIs 1,737.7 1,487.0 16.9%

Subordinated loan 1,763.0 414.6 325.3%

Current tax liabilities 92.2 0.0

Provisions for other risks and charges 381.6 382.8 -0.3%

Other financial liabilities 1,549.1 1,216.2 27.4%

Other liabilities 125.4 104.0 20.5%

Total liabilities 68,719.5 52,664.9 30.5%

Shareholders’ equity 7,542.2 7,125.4 5.8%

Non-controlling interest 290.0 14.7 1873.8%

Total liabilities and equity 76,551.7 59,805.0 28.0%


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-relationswww.bancatransilvania.rowww.bt24.ro

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