Yapi ve Kredi Bankasi A.S. · BIST:YKBNK
Yapi ve Kredi Bankasi A.S — Yapı Kredi — 9M12 Earnings Presentation
39 slides from Yapi ve Kredi Bankasi A.S's earnings presentation, Nov 13, 2012
Slide 1: Yapı Kredi 9M12 Earnings Presentation
Yapı Kredi 9M12 Earnings Presentation Istanbul, 13 November 2012
Slide 2: Agenda
Agenda Operating Environment 9M12 Results (BRSA Consolidated) Performance of Strategic Business Units & Subsidiaries Outlook / Strategy 2
Slide 3: Macro and financial stability leading to Turkey's achievement of investment grade
Macro and financial stability leading to Turkey’s achievement of investment grade Macroeconomic Environment Current Account Budget Deficit/ GDP Drivers Inflation Interest Rates Deficit GDP 10% GDP Growth (y/y) 12.5% CAD / GDP 5.0% 3.3% 2.9% CPI Inflation (eop) 11.5% O/N lending rate 9.9% 7.5% 10.6%
Slide 4: Sound banking system underpinning the investment grade rating
Sound banking system underpinning the investment grade rating Banking Sector Key Performance Balance Sheet Net Interest Margin Indicators TL bln Sep'12 Sep 12 1Q 2Q 3Q YTD Cumulative Quarterly 2011 1H12 9M12 1 Total Loans 716 2% 5% 2% 10% ROAE 15.4% 15.7% 15.4% TL 518 4% 7% 3% 14% 4.0% 3.9% 4.2% 4.0
Slide 5: Agenda
Agenda Operating Environment 9M12 Results (BRSA Consolidated) Performance of Strategic Business Units & Subsidiaries Outlook / Strategy 5
Slide 6: 9M12 Yapı Kredi Key Highlights
9M12 Yapı Kredi Key Highlights Key Highlights Balance sheet evolution confirming customer business focus Selective lending growth focused on value generating TL loans driven by GPLs (2x sector) and credit cards Strong TL deposit growth (+12% ytd) confirming solid gathering capability reinforced
Slide 7: 9M12 KPIs at a Glance
9M12 KPIs at a Glance Key Performance Indicators Net Income (mln TL) Return on Average Equity1 3 +11% 11% 1 835 1,835 1,653 20.8% 19.5% 3 Tangible: 19.5% 21.2% 1,478 13.1% 13.2% Tangible: +51% 15.5% 16.8% 639 414 424 1Q12 2Q12 3Q12 9M11 9M12 1Q12 2Q12 3Q12 9M11 9M12 Return on Assets2 Cost / Income 4
Slide 8: 1,478 mln TL net income driven by robust core revenue performance and cost discipline
1,478 mln TL net income driven by robust core revenue performance and cost discipline Income Statement y/y Revenues +7% y/y (+10% excl. mln TL 1Q12 2Q12 3Q12 9M11 9M12 y/y excl. reg. regulatory impacts). Core impacts p 2 revenues +17% y/y / (+21% Total Revenues 1,599 1,644 1,872 4,804 5,116 7% 10%
Slide 9: Balance sheet evolution confirming ongoing customer-focus
Balance sheet evolution confirming ongoing customer-focus Balance Sheet bln TL 2011 3Q12 3Q∆ YTD∆ Total Assets 117.5 127.0 2% 8% Loan growth +7% ytd with some Loans 69.3 74.2 2% 7% slowdown in 3Q (+2% vs 5% in 2Q) Securities 21.3 21.0 1% -1% Loans/assets at 58%, Deposits 66.2 69.3 1% 5% securiti
Slide 10: Solid core revenue performance
Solid core revenue performance Revenues Revenue Composition (mln TL) Core Revenue Breakdown (mln TL) 5,116 +7% 4,804 4,854 +17% Strong above sector core revenue performance 4,131 (+17% y/y, 21% excluding Net Interest 56% regulatory impacts1) Income 69% 68%1 1,798 − NII / revenues at 68% 1,508 1,54
Slide 11: Disciplined NIM management with resilient loan yields and positive evolution in deposit costs
Disciplined NIM management with resilient loan yields and positive evolution in deposit costs Net Interest Margin Net Interest Margin (NIM)1 (bank-only) Core Banking Spread2 (bank-only) 3.9% 4.1% 4.0% 3.5% 3.8% 3.6% 2.8% 2.5% 2.6% 2.1% 2.3% 2.2% 2011 9M12 4Q11 1Q12 2Q12 3Q12 2011 9M12 4Q11 1Q12 2Q12
Slide 12: Fees +13% y/y at Bank level with robust growth in card and insurance fees
Fees +13% y/y1 at Bank level with robust growth in card and insurance fees Fees & Commissions Net Fees and Commissions (mln TL) Group fees +7% y/y like-for-like1 (-9% y/y stated) driven by solid growth at Bank level (+13% y/y like-for-like1,-4% y/y stated) 1 434 1,434 despite contribution of subs
Slide 13: Selective growth strategy focused on value generating TL segments
Selective growth strategy focused on value generating TL segments Loans Loans Loan Composition Share of YKB YKB Sector Market 9M12 retail loans: 3Q∆ YTD∆ YTD∆ Share 48% 51% Credit 1 74.2 2% 7% 10% Cards 15.0% 17.7% Total Loans 10.0% Auto TL 50.7 3% 14% 14% 9.7% 1.8% 1.6% GPL 8.1% FC ($) 13.5 1% 0% 6
Slide 14: Strong TL deposit growth with contained deposit costs reinforced by 1-to-1 deposit pricing initiative
Strong TL deposit growth with contained deposit costs reinforced by 1-to-1 deposit pricing initiative Deposits Deposits TL Time Deposit Market Share and Cost YKB YKB Sector Market 10.3% 10.4% 9M12 3Q∆ YTD∆ YTD∆ Share 9.9% Total Deposits 69.3 1% 5% 6% 9.1% Cost of TL 8.8% Time Deposit TL 39.3 3% 12%
Slide 15: Cost growth in line with average inflation
Cost growth in line with average inflation Operating Costs Total Operating Costs (mln TL) 2,331 10% 6% 2,114 23% 5% Other1 Total costs +10% y/y, in line with average inflation 49% 50% 9% Non-HR2 − HR costs +10% y/y − Non-HR costs +9% y/y incorporating ongoing branch expansion (922 branches, +15 15
Slide 16: Asset quality evolution reflecting soft-landing of the economy
Asset quality evolution reflecting soft-landing of the economy Asset Quality NPL Ratio NPL Inflows and Collections NPL Inflows Collections 729 3.6% 597 595 3.3% 3.0% 466 477 408 428 304 346 297 3Q11 4Q11 1Q12 2Q12 3Q12 2011 2Q12 3Q12 Net Inflows3 (mln TL) 48 115 132 187 301 Collections/ C ll ti / In
Slide 17: 110% NPL coverage, <100bps cost of risk
110% NPL coverage, <100bps cost of risk 2 Provisioning and CoR Specific and General Provisioning Cost of Risk1 (Cumulative, net of collections) General provisions / NPL Specific Specific p provisions p / NPL Total 0.90% excl. regulatory impacts2 111% 111% 114% 110% 1.37% 100% 1.29% 1.21% 46% 45% 47%
Slide 18: Improvement in commercial effectiveness better than sector
Improvement in commercial effectiveness better than sector Commercial Effectiveness Productivity Indicators Product/Customer Related Initiatives 1Q11 2Q11 3Q11 2011 1Q12 2Q12 3Q12 Monthly change in # of disbursements 90% ee 3 372 3,372 +13% 70% Sound improvement in per TL Loans / Employe 50% SME 2
Slide 19: Agenda
Agenda Operating Environment 9M12 Results (BRSA Consolidated) Performance of Strategic Business Units & Subsidiaries Outlook / Strategy 19
Slide 20: Solid performance in Retail, Corporate and Commercial. Cards gradually improving. Private impacted by regulation
Solid performance in Retail, Corporate and Commercial. Cards gradually improving. Private impacted by regulation Business Units Weight in Bank Customer Revenues Y/Y Revenues1 Drivers of Revenue Growth Business2 (mln TL) (9M12 – 9M11) 42% 37% Retail3 Selective high margin loan growth and early 1,777
Slide 21: Steady performance by subsidiaries. YK Portföy impacted by regulation
Steady performance by subsidiaries. YK Portföy impacted by regulation Subsidiaries Revenues Revenue ROE Sector (mln TL) (y/y growth) Positioning Drivers of Revenue Growth #1 in total Increase in business volume despite lower YK Leasing L i 161 9% 15% transaction volume (17.2% mkt share) spreads 1 1
Slide 22: Agenda
Agenda Operating Environment 9M12 Results (BRSA Consolidated) Performance of Strategic Business Units & Subsidiaries Outlook / Strategy Annex 22
Slide 23: Increasingly positive economic outlook in 2013 supporting acceleration in sector volume growth
Increasingly positive economic outlook in 2013 supporting acceleration in sector volume growth Outlook 2012 2013 Drivers GDP Growth 3 2% 3.2% 4 6% 4.6% Higher g domestic demand coupled p with strong net exports Inflation1 Declining due to still moderate domestic 7.1% 6.4% cro demand and base effect
Slide 24: Continued focus on long-term strategic pillars
Continued focus on long-term strategic pillars Strategy Growth & Commercial Efficiency & Funding & Capital Asset Quality Effectiveness Cost Optimisation Selective and quality Above sector deposit Disciplined cost Dynamic and proactive loan growth growth & optimisation of efficiency approach
Slide 25: Agenda
Agenda Operating Environment 9M12 Results (BRSA Consolidated) Performance of Strategic Business Units & Subsidiaries Outlook / Strategy Annex 25
Slide 26: Agenda
Agenda Detailed Performance by Strategic Business Unit Other Details 26
Slide 27: Definitions of Strategic Business Units (SBU)
Definitions of Strategic Business Units (SBU) Retail: - SME: Companies with turnover less than 5 mln US$ - Affluent: Individuals with assets less than 500K TL - Mass: Individuals with assets less than 50K TL Private: Individuals with assets above 500K TL Commercial: Companies p with annual tur
Slide 28: Diversified revenue mix with retail focused loan and deposit portfolio
Diversified revenue mix with retail focused loan and deposit portfolio St t i Business Strategic B i Units U it Revenues and Volumes by Business Unit (9M12, Bank only) 40% Retail (including individual, 50% 52% 55% SME and card 55% payment systems1) 66% Pi t Private 2% 26% Corporate 8% 16% C Commerci
Slide 29: Solid revenue growth mainly driven by positive contribution of SME segment
Solid revenue growth mainly driven by positive contribution of SME segment R t il Banking Retail B ki (Individual (I di id l and d SME) Retail Banking Composition (9M12) 6.4 mln TL 1,777 mln +18% y/y TL 23.9 bln TL 25.8 bln Mass Segment: ~5.3 mln SME 10% ~609K customers generating: Affluent 7% ~44
Slide 30: Retail (Mass & Affluent)
Retail (Mass & Affluent) Selective growth and upward repricing offsetting negative impact of regulatory changes Revenues / Customer Business1 TL mln 9M12 ytd R Revenues ((y/y) / ) 580 0% y/y / Loans 12,753 12% 19,175 17% 2.8% Deposits 2.3% 2 2% 2.2% AUM 2,352 -14% % of Demand in Retail Deposits 16%
Slide 31: Retail (SME)
Retail (SME) Strong revenue performance driven by focus on value generating products ytd Revenues / Customer Business1 TL mln 9M12 Revenues (y/y) 1,196 29% y/y Loans 11,181 9% 5.1% 4.3% 4.0% Deposits p 6,643 8% AUM 655 -17% % of Demand in SME Deposits 45% -0.3 pp % of TL in SME Deposits 72% -1.4 pp
Slide 32: Card Payment Systems
Card Payment Systems Improving revenue performance via higher POS revenues offsetting higher cost of funding 9M12 ytd y/y 1 Net Revenues (mln TL) 604 -1% 2 # of Credit Cards (mln) 9.0 9% 11% # of Cardholders (mln) 5.2 4% 5% Strong g growth g in outstanding g # of Merchants (ths) 342 4% 6% volume (
Slide 33: Private
Private Revenues impacted by regulation on liquid fund management fees TL mln 9M12 ytd Revenues / Customer Business1 Revenues (y/y) 92 -10% y/y Loans 218 -16% Deposits 17,374 4% AUM 2,770 31% % of Demand in Private Deposits 4% -0.1 pp 0.7% 0.6% 0.6% % off TL in i Private P i t Deposits D it 61% 1 7
Slide 34: Corporate
Corporate Revenues driven by positive impact of upward loan repricing and lower cost of funding TL mln 9M12 ytd Revenues / Customer Business1 R Revenues 328 23% y/y / Loans 10,989 -9% Deposits 13,651 -3% AUM 4 -77% 1.9% 1.7% 1.7% % of Demand in Corporate Deposits 6% 0.3 pp % of TL in Corporate Depos
Slide 35: Commercial
Commercial Revenues driven by upward loan repricing initiatives and focused approach on high margin mid-commercial TL mln 9M12 ytd Revenues / Customer Business1 R Revenues 857 23% y/y / Loans 19,498 6% Deposits 8,142 3% 4.4% % 4.3% AUM 177 -12% 4.2% % of Demand in Commercial Deposits 32% -4.8 pp % o
Slide 36: Agenda
Agenda Detailed Performance by Strategic Business Unit Other Details 36
Slide 37: 56% of securities portfolio invested in HTM
Securities 56% of securities portfolio invested in HTM Securities Composition by Type Securities Composition by Currency (TL bln) 21 3 21.3 20 9 20.9 21 0 21.0 Trading 2% 3% 4% 38% 39% 40% AFS 51% 47% 46% FC (1% FRN) (1% FRN) (1% FRN) HTM 60% 58% 56% TL 52% 53% 54% ((52% % FRN)) ((56% % FRN)) ((60%
Slide 38: International Borrowings
Borrowings ~ US$ 2.7 bln outstanding Syndications Apr’12: US$ 264 mln and €865 mln, Libor +1.45% p.a. all-in cost, 1 year, participation of 44 banks from 21 countries Sep’12: US$ 322 mln and €618 mln, Libor + 1.35% p.a. all-in cost, 1 year, participation of 37 banks from 16 countries ~ US$ 1 1,3 3 b
Slide 39: Contact Investor Relations
Contact Investor Relations Yapı Kredi Head Office Yapı Kredi Plaza D Blok Levent 34330 Istanbul - TURKEY Tel: +90(212) 339 73 23 Email: [email protected] Web: www.yapikredi.com.tr/investorRelations 39