Banca Mediolanum SpA · MIL:BMED
Banca Mediolanum SpA — Mediolanum — FY2012 Earnings Presentation
43 slides from Banca Mediolanum SpA's earnings presentation, Mar 21, 2013
Slide 1: Mediolanum FY 2012 Results
1 March 21, 2013 MEDIOLANUM FY 2012 RESULTS 2 Table of Contents FY 2012 Group p Results 3 FY 2012 Domestic Market Results 15 FY 2012 Foreign g Markets Results 34 FY 2012 Group p Embedded Value 39 Business Update 51 Mediolanum Facts 67
Slide 2: Q4 Income Statement - Group
3 FY 2012 Group Results FY 2012 4 Group Q4 Income Statement - Group € mn Q412 Q411 Change Net premiums written 2,389.6 2,477.3 -4% Amounts paid & change in technical reserves (2,383.2) (2,469.5) -3% Life revenues ex-commission 6.5 7.8 -17% Entry fees 36.8 20.1 +83% Management fees 126.0 103.8 +21% P
Slide 3: Income Statement - Group and Salient Points
FY 2012 5 Group Income Statement - Group € mn FY12 FY11 Change Net premiums written 8,051.3 9,543.4 -16% Amounts paid & change in technical reserves (8,018.1) (9,505.0) -16% Life revenues ex-commission 33.3 38.4 -13% Entry fees 115.6 98.5 +17% Management fees 472.2 417.8 +13% Performance fees 171.9
Slide 4: Quarterly Management Fees and Net Interest Income
FY 2012 7 Group Quarterly Commission Income from Management Fees € mn Management fees (€ mn) yearly bps on average assets 250 160 203 204 205 140 197 200 120 150 100 80 100 126 60 113 114 120 94 100 105 105 104 104 86 91 72 81 40 50 59 66 20 0 0 2009 2010 2011 2012 FY 2012 8 Group Quarterly Net Inte
Slide 5: Performance Fees and Assets under Administration
FY 2012 9 Group Yearly Commission Income from Performance Fees Including Managed Accounts & Unit-linked policies Performance fees (€ mn) bps on average assets* 160 146 200 133 140 160 120 99 100 97 avg bps 82.5 88 120 80 63 57 52 172 60 153 155 152 80 45 45 40 92 85 83 40 57 62 20 50 0 0 2003 2004 2
Slide 6: Assets under Administration and Embedded Value
FY 2012 11 Group Assets under Administration € mn 31/12/12 31/12/11 Change Life 13,795.7 13,678.5 +1% 'Freedom' Life Policies 3,433.0 4,503.8 -24% Asset management 23,384.4 19,725.3 +19% Banking* 11,336.5 8,925.6 +27% Consolidation adjustments (9,515.3) (8,966.0) +6% Italy - Banca Mediolanum 42,434.
Slide 7: Dividend Proposal and Dividend Payout
FY 2012 13 Group Dividend Proposal Dividend per share 18 eurocents - interim dividend paid in November 2012 10 eurocents - balance to be paid in May 2013 8 eurocents Total amount of dividends € 132 mn Dividend payout ratio - on consolidated net income 38% - on Mediolanum S.p.A. statutory net income
Slide 8: FY 2012 Domestic Market Income Statement
15 FY 2012 Domestic Market Results FY 2012 16 Domestic Market Income Statement - Domestic € mn FY12 FY11 Change Net premiums written 7,922.8 9,400.9 -16% Amounts paid & change in technical reserves (7,908.5) (9,381.5) -16% Life revenues ex-commission 14.3 19.4 -26% Entry fees 110.4 94.5 +17% Managem
Slide 9: Domestic Income Statement by Quarter
FY 2012 17 Domestic Market Income Statement by Quarter € mn Q111 Q211 Q311 Q411 Q112 Q212 Q312 Q412 Life revenues ex-commission 7.3 7.8 2.5 1.9 7.7 1.9 3.8 0.9 Entry fees 25.3 25.9 24.1 19.2 25.0 26.4 23.7 35.3 Management fees 100.7 101.3 99.7 99.8 108.4 109.2 115.3 121.1 Performance fees 13.0 7.4 9
Slide 10: Total Net Inflows by Group; Profit by Segment
FY 2012 19 Domestic Total Net Inflows by Group: Market Mediolanum at the top of the ranking Italian Networks - € thousands FY 2012 Total Net Inflows o/w Managed Assets o/w Mutual Funds * * Banca Mediolanum 2,323,738 1,417,567 2,348,479 Banca Fideuram (incl. Sanpaolo) 2,316,262 2,748,961 583,679 Unic
Slide 11: Asset Management Segment Inflows
FY 2012 21 Domestic Asset Management Segment Market Gross Inflows € mn - U-L assets not included FY12 FY11 Change 'Best Brands' funds of funds (IRL) 3,659.0 2,920.0 +25% 'Challenge' mutual funds (IRL) 1,018.9 837.6 +22% 'Fondi Italia' mutual funds (ITA) 1,067.9 606.3 +76% 'Real estate' fund (ITA) 18
Slide 12: Asset Management Segment Assets under Management
FY 2012 23 Domestic Asset Management Segment Market Assets under Management € mn - including U-L assets 31/12/12 31/12/11 Change 'Best Brands' funds of funds (IRL) 7,676.9 5,398.3 +42% 'Portfolio' funds of funds (IRL) 578.5 680.1 -15% 'Challenge' mutual funds (IRL) 11,980.7 11,221.2 +7% Funds of Hed
Slide 13: Life Segment Gross Premiums Written
FY 2012 25 Domestic Life Segment Market Gross Premiums Written € mn FY12 FY11 Change U-L pension plans 25.5 27.4 -7% U-L endowment policies 24.5 18.5 +32% U-L whole-life investment policies 13.1 17.0 -23% Recurring policies (AP)* 63.1 62.9 +0% Term, Group, Investment policies 8.0 8.2 -2% U-L whole-l
Slide 14: Life Segment Amounts Paid and Surrender Rate
FY 2012 27 Domestic Life Segment Market Amounts Paid in detail € mn - ex 'Freedom' Life Policies FY12 FY11 Change Claims 64.8 69.4 -7% Coupons 64.5 84.1 -23% Maturities 1,095.8 1,248.1 -12% o/w index-linked 773.4 970.1 -20% Surrenders 997.6 916.6 +9% AMOUNTS PAID 2,222.8 2,318.2 -4% FY 2012 28 Domes
Slide 15: Life Policyholders' Assets and Banking Revenues
FY 2012 29 Domestic Life Segment Market Policyholders' Assets € mn 31/12/12 31/12/11 Change Traditional 1,372.0 1,350.7 +2% Index-linked 2,572.7 3,171.7 -19% Unit-linked pension plans 3,728.2 3,087.4 +21% Unit-linked endowment policies 3,620.7 3,484.3 +4% Unit-linked investment policies 2,502.1 2,58
Slide 16: Banking Segment Assets and Customers
FY 2012 31 Domestic Banking Segment Market Assets under Administration* € mn 31/12/12 31/12/11 Change Cash deposits 7,623.1 5,489.2 +39% Repurchase agreements 12.9 211.2 -94% Mediolanum bonds 409.7 487.6 -16% 3rd-party structured bonds 1,216.1 805.9 +51% Other securities under custody 2,074.8 1,931.
Slide 17: Banca Esperia Highlights
FY 2012 33 Domestic Banca Esperia (100%) Market Highlights € mn FY12 FY11 Change Profit Before Tax 8.0 4.9 +62% Net Income 5.1 1.4 +256% o/w Mediolanum share 2.5 0.7 +256% Assets under Administration 13,800 12,817 +8% % in Managed Assets 55.7% 62.6% -11% Net Inflows (1,241) 603 n.s. o/w Managed Asse
Slide 18: Spain and Germany - B. A. Lenz Highlights
FY 2012 35 Foreign Spain Markets Highlights € mn FY12 FY11 Change Net Income before impairment 27.4 3.9 n.s. Impairment of CGU 'Spain' (20.1) 0.0 n.s. Net Income 7.2 3.9 +86% Managed Assets 1,181.2 986.8 +20% Administered Assets 618.4 594.5 +4% Total Assets 1,799.6 1,581.2 +14% Gross Inflows into Ma
Slide 19: Germany - Gamax and Total Highlights
FY 2012 37 Foreign Germany - Gamax Markets Highlights € mn FY12 FY11 Change Net Income 1.7 1.6 +11% Assets under Administration 228.4 204.8 +12% Gross Inflows 53.7 36.0 +49% Net Inflows (0.1) 1.1 n.s. FY 2012 38 Foreign Germany - Total Markets Highlights € mn FY12 FY11 Change Net Income (4.7) (11.5)
Slide 20: FY 2012 Group Embedded Value Methodology
39 FY 2012 Group Embedded Value FY 2012 40 Group EV MCEV-compliant Methodology Further details available in the supplementary disclosure on the Mediolanum website Compliant with CFO Forum MCEV Principles MCEV fully adopted for covered business (Life Insurance) Asset Management and Banking Consistent
Slide 21: Group Embedded Value and EV Earnings
FY 2012 41 Group EV Group Embedded Value € mn FY12 FY11 Change Published shareholders' net assets 1,420 762 +86% Adjustments to net assets (103) 8 n.s. Adjusted shareholders' net assets 1,317 770 +71% Italy - VIF Life Business (MCEV) 1,294 1,225 +6% Italy - VIF A.M. Business 686 564 +22% Italy - VIF
Slide 22: EV Earnings Components: Earnings on Initial EV
FY 2012 43 Group EV EV Earnings Components (1) Earnings on Initial EV € mn FY12 FY11 Expected return on EV - unwind 194 135 Operating assumption changes (42) (76) Economic assumption changes & experience variances 399 (722) Operating experience variances* 30 (33) Earnings on Initial EV 581 (696) Val
Slide 23: Value Added by New Business; Life Margins
FY 2012 45 Group EV EV Earnings Components (2) Value Added by New Business € mn FY12 FY11 Earnings on Initial EV 581 (696) Life New Business 10 (2) A.M. New Business 194 126 Banking New Business 47 28 Value added by New Business 250 152 EV Earnings 831 (543) FY 2012 46 Group EV Life New Business Mar
Slide 24: A.M. and Life New Business Margins
FY 2012 47 Group EV A.M. New Business Margins(% %PVNBP*) Domestic Market € mn FY12 FY11 Change A.M. New Business Margin 4.0% 3.5% +13% Value of New Business - 'moment of sale' 189 124 +52% PVNBP 4,687 3,498 +34% * Present Value of New Business Premiums FY 2012 48 Group EV Life New Business Margins (
Slide 25: A.M. Margins and Spain In-force Value
FY 2012 49 Group EV A.M. New Business Margins (%APE*) Domestic Market € mn FY12 FY11 Change A.M. New Business Margin 39.1% 33.8% +16% Value of New Business - 'moment of sale' 189 124 +52% Installment plans 61 69 -12% Lump sum investments 4,219 2,989 +41% APE 483 367 +31% FY 2012 50 Group EV Spain In
Slide 26: Business Update: Banca Mediolanum Net Inflows
51 Business Update Business 52 Update Banca Mediolanum Net Inflows € mn Feb ‘13 Jan-Feb‘13 Jan-Feb’12 Life premiums* (153) (256) (116) Asset management products 269 619 168 Managed Assets Inflows 116 363 52 3rd-party Structured Bonds 19 12 15 Managed Assets incl. Structured Bonds 134 376 67 Administ
Slide 27: Total Net Inflows by Group, January 2013
Business 53 Update Total Net Inflows by Group: A good start for the year Italian Networks - € thousands January 2013 Total Net Inflows o/w Managed Assets o/w Mutual Funds * * Banca Mediolanum 237,402 253,361 350,235 Banca Generali 207,244 161,785 103,332 Unicredit (Finecobank) 176,253 315,174 348,27
Slide 28: Ranking of Italian A.M. Groups; OgniMese Mediolanum
Business 55 Update Ranking of Italian A.M. Groups by Mutual Funds Assets Source: Assogestioni (M&A operations) June 2007 December 2007 December 2008 December 2009 December 2010 December 2011 January 2013 1. Eurizon Intesa Sanpaolo Intesa Sanpaolo Intesa Sanpaolo Intesa Sanpaolo Intesa Sanpaolo Intes
Slide 29: InMediolanum Deposit Account and Results
Business 57 Update ‘InMediolanum’ Deposit Account An aggressive move to amass assets launched May 2011 No-cost deposit account for both new & existing customers of Mediolanum with a competitive interest rate paid when money is locked in for one year (currently 3.1%) Promo (Feb-Mar 2013): simultaneou
Slide 30: Freedom+ Current Account and Results
Business 59 Update ‘Freedom+’ Current Account The New Generation launched March 2012 Now a pure banking product Maintains its role as strategic tool to acquire high quality customers through competitive remuneration of liquidity Fiscal advantages of the existing bank account + life policy combo were
Slide 31: Freedom Customers Cross-selling; Group Bond Portfolio
Business 61 Update ‘Freedom’ account customers: Cross-selling into managed products Per-capita asset growth of ‘Freedom’ account holders* (€ 6.2 bn in total assets as at 31/12/2012) Average assets after 44 months € 163,540 160,000 € 75,742 (46%) in high-margin managed assets products 120,000 80,000
Slide 32: Banca Mediolanum Balance Sheet and Interest Spread
Business 63 Update Banca Mediolanum Balance Sheet € mn – as at 31/12/2012 Liabilities Assets Retail 7,710 3,894 Treasury 7,665 11,787 o/w / interbank i t b k / iintra-group t d deposits it & repos 1 1,835 835 1 1,133 133 o/w ECB (LTRO & other refinancing) 3,000 3,090 o/w MTS (collateral-backed finan
Slide 33: Banking Group Capital Ratios and Capital Adequacy
Business 65 Update Mediolanum Banking Group Capital Ratios as at 31/12/2012 Mediolanum Basel 3 Basel 3 Banking Group Requirements Requirements (2015) (2019) Total Capital Ratio 13.84% 8.0% 10.5% Tier 1 Capital Ratio 12.14% 6.0% 8.5% Common Equity Tier 1 Ratio 12.14% 4.5% 7.0% Business 66 Update Medi
Slide 34: Mediolanum Group Structure
67 Mediolanum Facts Mediolanum 68 Facts Mediolanum Group Structure as at 30/06/2012 40.5% 36% Doris Group Fininvest Mediolanum 3.38% (directly & through Mediobanca Mediolanum Vita) 100% Banca Mediolanum Banking Group Mediolanum* Mediolanum 51% Gestione Fondi 49% Mediolanum 50% 100% Vita Banca % 51%
Slide 35: Integrated Business Model and Retail Banking Model
Mediolanum 69 Facts The Mediolanum Integrated Business Model We integrate the asset gathering business of Life insurance & mutual funds with the banking business… /LIH ,QVXUDQFH 0XWXDO )XQGV %DQN …on the strength of an avant-garde model Mediolanum 70 Facts The Mediolanum Integrated & Comprehensive R
Slide 36: Mediolanum vs. Current Bank Models; Net Profit
Mediolanum 71 Facts Mediolanum vs. Current Bank Models Traditional bank On-line bank The human relationship Freedom of use high prices << Customer >> low prices high costs but high revenues << Bank >> low costs but low revenues The Mediolanum model unifies the advantages of the on-line with the trad
Slide 37: Family Banker Network and Customers
Mediolanum 73 Facts Banca Mediolanum Family Banker Network Licensed Advisors 5,040 5,077 4,945 4,772 4,507 4,114 4,052 4,048 3,978 4,011 4,315 3,842 3,018 2,513 2,046 1,915 1,828 1,885 2,200 1,581 1,659 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 20
Slide 38: Bank Accounts and Total Net Inflows Trend
Mediolanum 75 Facts Banca Mediolanum Bank accounts Thousands March 2005 ‘4Freedoms’ strategy launch* 708 627 582 568 534 566 466 392 344 297 339 333 219 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 * all new customers are acquired through the bank account Mediolanum 76 Facts Banc
Slide 39: Italian Households' Assets; Mutual Funds Market Share
Mediolanum 77 Facts Italian Households’ Financial Assets Mediolanum’s Market Share 1,4% 1.25% 1,2% 1,0% 0,8% 0,6% 0,4% 0,2% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 source: Banca d’Italia Mediolanum 78 Facts Mutual Funds AuM – Italian Market Mediolanum’s Market Share since Oc
Slide 40: MED.MI Total Return Index; Our Culture
Mediolanum 79 Facts MED.MI Total Return Index* 1400 1200 1000 800 600 400 200 0 * includes dividend reinvestment, June 3, 1996 – March 12, 2013 source: Datastream Mediolanum 80 Facts Our Culture, Our Competitive Advantage Our ability to generate positive inflows also in bear markets is explained by
Slide 41: Investment Advisory Strategy; Mediolanum Approach
Mediolanum 81 Facts Our Investment Advisory Strategy Our investment strategy explains the consistency of our inflows & transfers ‘technical performance’ into ‘customer performance’ We advise our customers proposing products & services that correspond to each of their specific needs Investor needs re
Slide 42: Corporate University and Corporate TV Channel
Mediolanum 83 Facts Training & Communication: Mediolanum Corporate University Inaugurated March 2009 Centralises our training know-how, in coordination with top universities, professors and individuals who are experts in the field Provides our Family Bankers & employees with a resource for life-long
Slide 43: Disclaimer and Investor Relations Contacts
85 Disclaimer This document has been prepared by Mediolanum S.p.A. for the sole purpose of providing information and presenting the Group’s strategies. The information, opinions, valuations and forecasts it contains have not been audited by any independent body; they may be altered at any time witho