Banque Cantonale Vaudoise · SIX:BCVN
Banque Cantonale Vaudoise — Non-Deal Roadshow (May 2006)
29 slides from Banque Cantonale Vaudoise's roadshow presentation, May 4, 2006
Slide 1: BCV Group full year 2005 figures and strategy going forward
BCV Group full year 2005 figures and strategy going forward Zurich, 04 May 2006 1
Slide 2: 1. BCV in 2005 2. Strategy going forward and outlook 2006
1. BCV in 2005 2. Strategy going forward and outlook 2006 2
Slide 3: Record results
Record results Changes 2004 YTD % Gross profit clearly improved CHF 1,038 mn +10% Revenues climb over a CHF 486 mn +22% billion Strong net profit growth CHF 457 mn +36% 3
Slide 4: 2005: main trends in business volumes
2005: main trends in business volumes CHF mn (rounded) ESTIMATES Increase in mortgage volumes 1 +374 +2% Slight increase in other credit volumes 1 +78 +1% Strong growth in AuM's +7,680 +12% Increase in savings and client +596 +3% deposits Strong growth in structured products +414 +85% 1 Excl. effect
Slide 5: P&L in 2005
P&L in 2005 CHF mn (rounded) 2004 2005 Variation All revenue sources Total revenues 944 1,038 +94 +10% on the increase Operational Sustained cost expenses -546 -552 +6 +1% control Gross profit 399 486 +87 +22% Depreciations -86 -91 +5 +5% No longer needed provisions for the Value adjustments, affili
Slide 6: Revenues climb over a billion
Revenues climb over a billion CHF mn (rounded) 1•038 +10% 944 +13 +25 +19 +37 461 +9% Interest income 424 Growth stems from all revenue 323 +8% sources Commis- sions 298 Trading 84 103 +22% Others 138 151 +10% 2004 Interest Commis- Trading Others 2005 income sions 6
Slide 7: Rigorous cost control
Rigorous cost control Trends in operational expenses, CHF mn (rounded) +1% 5671 554 552 546 Other operational Slight increase due to 190 181 188 investments in strategic expenses 181 projects Personnel 377 Sustained cost 373 365 364 control in personnel expenses 2002 2003 2004 2005 1 Includes the fu
Slide 8: Extraordinary income generated by provision releases
Extraordinary income generated by provision releases Breakdown in extraordinary income in 2005, CHF mn ESTIMATES 211 195 +16 +45 +91 +79 -20 New Release from Releases Partial release Total net sum of Others Extraordinary provisioning real estate from other from the lump the new and income of BCV nee
Slide 9: CHF 110 mn allocated to the reserve for general banking risks (RGBR)
CHF 110 mn allocated to the reserve for general banking risks (RGBR) Trend for RGBR at RGBR as % of equity BCV, in CHF mn 442 36% • The RGBR is an 110 integral part of the equity • Meant to cover Building of exceptional events reserves • Regularly used by 211 Swiss cantonal banks 14% 332 110 Extraor
Slide 10: Changes in the balance sheet: assets
Changes in the balance sheet : assets Assets, CHF bn (rounded) Change 34.9 +8% 32.3 Increase mainly due to the 5.6 +20% inflow of client funds and Cash and due divestments 4.7 to banks Mostly due to the reduction in 5.8 -9% impaired loans (CHF -800 mn) Loans and advances 6.4 to customers New mortgag
Slide 11: Changes in the balance sheet: liabilities
Changes in the balance sheet : liabilities Liabilities, CHF bn (rounded) Change 34.9 +8% 32.3 2.1 +70% Banks 1.2 Savings remain stable (some transfers towards other 8.8 -0.4% investment products and Savings 8.9 bancassurance) Significant inflow of cash from 9.1 +8% corporates and institutionals Othe
Slide 12: Strong increases in assets under management
Strong increases in assets under management CHF bn (rounded) 71.8 +12% 4.8 64.1 1.9 60.2 4.0 54.8 3.0 2.1 Piguet 1.5 2.2 •Net new money Other affiliates 2.3 1,546 mn1 •Without taking into account the outflows linked to the 65.1 integration of 55.7 58.0 activities from 2 Parent bank, 50.3 institution
Slide 13: All business areas on the rise
All business areas on the rise CHF mn (rounded) Gross profit Net profit 2004 2005 Change 2004 2005 Change Retail banking 146 157 +7% 36 46 +27% Wealth management 140 175 +25% 59 83 +40% Corporate banking 163 153 -6% 42 51 +22% Trading 23 30 +32% 10 14 +41% 13
Slide 14: Board proposals accepted at the 2006 AGM
Board proposals accepted at the 2006 AGM Priority dividend for participation certificates 30.8 mn (CHF 2.69 per PC) Proposed dividend of CHF 4.50 per reg. share (up 50% 38.5 mn from CHF 3.00 in 2004) Buy-back tranche of participation capital in 400.0 mn 2006 14
Slide 15: We kept our word
We kept our word • Successful launch of an ambitious growth program ü • Further significant reduction of impaired loans ü • Implementation of the first buyback tranche of P-C capital while proposing a second buyback tranche ü • Improved credit rating from Standard & Poors from A– to A (as of 27.01.2
Slide 16: Changes in revenues, gross and net profit
Changes in revenues, gross and net profit CHF mn (rounded) +10% Sustained and significant increase Total 943 944 1•038 840 858 in revenues while revenues improving the Group's risk profile +22% 389 399 486 330 320 Significant Gross profit operational improvement +36% 457 337 157 Strong rise in net N
Slide 17: Volumes of impaired loans have been significantly reduced but levels remain too high
Volumes of impaired loans have been significantly reduced but levels remain too high Trends in impaired loans, CHF bn (rounded)1 Parent bank 4.4 Ratio "impaired loans/ credit exposure 3.7 2.7 0.8 1.9 0.2 Of which Non <0.8 Performing according 1.7 to SFBC rules 15% 13% 10% 7% <3% 2002 2003 2004 Reduc
Slide 18: Significant improvement in key ratios
Significant improvement in key ratios 2002 2003 2004 2005 Impaired loans / Quality and 15% 13% 10% 7% credit exposure balance Client deposits / sheet 68% 74% 78% 83% Loans to clients structure Net interest margin 1.25% 1.23% 1.29% 1.40% Equity ratio SFBC 76% 156% 185% 195% Equity Tier 1 ratio (BRI)
Slide 19: Comparing key ratios with stated goals
Comparing key ratios with stated goals 2002 2005 Goals Strong improvement Impaired loans / 15% 7% <3% but needs to Quality and credit exposure continue balance sheet structure Excellent progress Net interest margin 1.25% but more remains to 1.40% •1.50% be done Current performance Cost/income has to
Slide 20: 1. BCV in 2005 2. Strategy going forward and outlook 2006
1. BCV in 2005 2. Strategy going forward and outlook 2006 20
Slide 21: BCV has entered the second phase of its strategy
BCV has entered the second phase of its strategy 2004 2005 2006 2007 2008 First phase Successful turnaround: Strategic realignment ü Financial situation ü Second phase Governance and organisation ü Growth and profitability in core businesses Capital structure ü CroisSens growth project Products Oper
Slide 22: Main strategic objectives
Main strategic objectives • Strengthen business growth and profitability of core businesses • Further reduce the impaired loan portfolio • Pursue the in-depth review and overhaul of management and business processes • Plan additional buybacks of the participation certificates 22
Slide 23: CroisSens program: Five key levers to strengthen BCV's market position
CroisSens program: Five key levers to strengthen BCV’s market position Specific and differentiated • Improve our value proposition for key 1 value propositions for segments, e.g., affluent clients with a better each customer segment adapted offer (proximity, service level, etc.) Increase the commerc
Slide 24: The goal and impact of "CroisSens"
The goal and impact of "CroisSens" Goal Impact Stabilize market position by 2007 Growth Strengthen the strong long term market position BCV growth Increase revenues due to additional volumes (deposits, AuM, mortgages) resulting in a lower C/I in the future Market growth Despite costs associated to C
Slide 25: CroisSens: operational implementation on schedule
CroisSens: operational implementation on schedule Client proximity Successful migration of client portfolio's within the CroisSens reorganisation between core businesses 2 call centres (one for general inquiries and one for the corporate client base) Increased client contacts and new client oriented
Slide 26: CroisSens: next steps
CroisSens: next steps BCV Brand • Launch of the new brand and its April – June corporate repositioning 2006 Retail • Network revamp from mid-2006 until Fall 2006 network 2007 Training • Behavioural based sales training for the April – Dec. front 2006 Progress • Individual analysis of sales targets S
Slide 27: Other selective sources of growth
Other selective sources of growth Trade finance • Market fundamentals in selected segments (softs and metals) remain positive • Opportunities to increase BCV's risk exposure within the limits of the Group's current risk profile Institutional asset management • Excellent fund results based on consist
Slide 28: Outlook for financial results in 2006
Outlook for financial results in 2006 • Based on the Group's moderately positive views on the Swiss and Vaud economy as well as on financial markets • Slight increase in business volumes • Sustained improvements of gross profits but at a slower pace than in 2005 28
Slide 29: Optimising BCV's value proposition for shareholders
Optimising BCV’s value proposition for shareholders • Aiming for long term moderate but steady top line growth • Improving recurrent gross profit growth in core businesses • Optimising equity requirements in order to meet ROE targets over the long term • Aiming for continuous dividend increases whil
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