Investor Presentation • Feb 3, 2023
Investor Presentation
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12M22 BANCO BPI CONSOLIDATED RESULTS
03 FEBRUARY 2023
Support to Families and Businesses Loans grew by 6% and deposits by 5% ( yoy)
Financial strength and low risk NPE of 1.6%, with 155% coverage; CET1 and total capital ratios of 14.8% and 18.9%
Net profit of 235 M.€ (+31% yoy) in Portugal and 365 M.€ (+19% yoy) consolidated
Social commitment in collaboration with "la Caixa" Foundation 40 M.€ of social investment and support to 97 thousand people in 2022.
"Best Bank in Portugal 2022" for Euromoney
"Bank of the Year 2022" for The Banker magazine (Financial Times Group)
Full 2022
| Commercial activity in Portugal |
Loans YoY +1.6 Bn.€ +6% |
Deposits YoY +1.5 Bn.€ +5% Stable customer resources |
YoY +14% Gross income +20% Net interest income +3% Fee and commission income |
Digital Banking Regular users 856 th. BPI app users +93 th. YoY |
|---|---|---|---|---|
| Risk and capitalisation |
NPE Ratio (EBA) 1.6% |
NPE coverage 155% (by impairments and collaterals) |
Cost of Risk 0.20% (as % of loans and guarantees) |
14.8% CET1 16.4% T1 18.9% Total (Phasing-in) IRB adoption mortgage loans |
| Profit and profitability |
Net profit in Portugal YoY 235 M.€ +31% |
Recurrent ROTE in Portugal 8.0% |
Cost-to-core income in Portugal 50.2% |
Consolidated net profit YoY 365 M.€ +19% |
Net profit in Portugal grew 31%, to 235 M.€
| In M € |
Dec 21 |
Dec 22 |
Δ% |
|---|---|---|---|
| Activity in Portugal |
|||
| profit Recurrent net |
200 | 249 | 24% |
| 1) Non-recurrent impacts |
-22 | -15 | -32% |
| profit in Portugal Net |
179 | 235 | 31% |
| contribution BFA |
106 | 96 | -9% |
| contribution BCI |
23 | 34 | +52% |
| Consolidated profit net |
307 | 365 | +19% |
| Activity in Portugal | Dec | 21 | Dec 22 |
Recurrent ROTE 6.8% 8.0%
| +104 M.€ |
|---|
| -18 M.€ |
| -13 M.€ |
| -24 M.€ |
| +49 M.€ |
1) Early retirements and voluntary terminations (after tax)
5
2) Net interest income, fees and commissions, dividends and equity accounted income.
| Loans to Customers by segments | |||||
|---|---|---|---|---|---|
| portfolio in Gross Bn € , |
Dec 21 |
Dec 22 |
YoY | ||
| individuals I Loans to |
14 9 |
16 0 |
7% | ||
| loans Mortgage |
13 1 |
2 14 |
8% | ||
| Other loans individuals to |
1 8 |
1 8 |
0% | ||
| companies II Loans to |
10 5 |
10 9 |
4% | ||
| Public III sector |
2 1 |
2 2 |
6% | ||
| Total loans |
27 5 |
29 2 |
6% | ||
| Note: | |||||
| portfolio of Loan net impairments |
27 0 |
28 6 |
6% | ||
| Market share | |
|---|---|
| of total loan portfolio |
11.5% +0.4 p.p. YoY |
| (Dec. 2022) | |
| Customer Resources | Market shares | |||
|---|---|---|---|---|
| In Bn.€ | Dec 21 | Dec 22 | YoY | |
| I. Customer deposits | 28.9 | 30.3 | 5% | |
| II. Off-balance sheet resources | 11.4 | 9.7 | -15% | |
| Mutual funds | 6.3 | 5.3 | -15% | |
| Capitalisation insurance | 4.6 | 4.3 | -6% | |
| Public offerings | 0.6 | 0.1 | - | |
| Total | 40.3 | 40.0 | -1% | |
| Additionally, the placement of structured products increased |
| Nov 22 |
YoY |
|
|---|---|---|
| resources 1 Customer |
11 2% |
-0 1 p.p. |
| Deposits 2 | 10 9% |
+0 0 p.p. |
| Mutual funds |
6% 11 |
+1 1 p.p. |
| Capitalisation insurance |
18 2% |
+0 1 p.p. |
| plans Retirement savings |
4% 11 |
-0 4 p.p. |
1) Deposits, mutual funds and capitalisation insurance.
by 0.4 Bn.€ in 2022.
9
10
| M.€ | 2021 | 2022 |
|---|---|---|
| Net loan impairments | 71 | 87 |
| Gains on the sale on non performing loans |
23 | 27 |
| TOTAL | 47 | 61 |
▪ Sale of 141 M.€ non-performing loans (gross) in 3rd quarter 22 with 27 M.€ gain (pre-tax)
On-balance sheet non-allocated impairments: 50 M.€ in Dec.22
| 2022 | |
|---|---|
| NPL ratio (EBA criteria) |
2.0% |
| Non-Performing Loans (NPL) | 571 M.€ |
| NPL coverage by impairments and collaterals |
157% |
| Foreclosed properties (net book value) |
2 M.€ |
| Corporate restructuring and recovery funds (book value) |
24 M.€ |
| Actuarial deviations (M €) |
In 2022 |
|---|---|
| Change in the discount rate |
611 |
| from portfolio Income investment |
-215 |
| and growth Wages pensions |
-203 |
| Other | -49 |
| Actuarial deviations |
145 |
BPI meets MREL requirements for the start of 2024
BPI adopts IRB approach to calculate capital requirements for mortgage loans. +1.5 pp impact on CET1 ratio.
| CAPITAL RATIOS Consolidated (phasing-in) |
17 4% |
18 9% |
Capital requirements (SREP) | ||
|---|---|---|---|---|---|
| Total Capital | 2022 | 2023 | |||
| Tier 1 Common Equity Tier 1 |
15 7% 14 2% |
16 4% 8% 14 |
Total Capital | 13.00% | 12.90% |
| T1 | 10.50% | 10.43% | |||
| Capital requirements net of dividend distribution |
CET1 | 8.63% | 8.57% | ||
| 21 Dec |
22 Dec |
||||
| Risk-weighted assets (RWA) | 18.3 Bn.€ | 17.3 Bn.€ -5.5% |
|||
| MDA buffer (Maximum Distributable Amount) | 4.5% | 5.9% | |||
| Leverage ratio | 6.8% | 7.1% | Leverage | 3.0% | 3.0% |
| MREL RATIOS | MREL requirement | ≥1Jan.2022 | ≥1Jan.2024 | ||
| MREL as % of RWA |
23.7% | 25.6% | MREL / RWA | 1) 19.18% |
1) 22.40% |
| MREL as % of LRE |
10.3% | 11.1% | MREL / LRE | 5.91% | |
15 1) Includes combined capital buffer requirement RWA – Risk Weighted Assets; LRE – Leverage Ratio Exposure.
ECB funding reduced to 0.4 Bn.€
1) 12-month average, in accordance with the EBA guidelines. Average value (previous 12 months) of the calculation components: Liquidity reserves (10 675 M.€); Total net outflows (4 495 M.€).
2) High Quality Liquid Assets (HQLA) of 7.2 Bn.€ and other assets eligible as collateral with ECB of 5.7 Bn.€
16
2022-2024 Sustainability Master Plan, Commitments and Results
| 2022-2024 TARGET |
ACHIEVED IN 2022 |
||||
|---|---|---|---|---|---|
| Global | |||||
| Sustainable business | 4 Bn.€ | 2 Bn.€ | |||
| ▪ in Loans ▪ in Investment |
2 Bn.€ 2 Bn.€ |
608 M.€ 1.4 Bn.€1 |
|||
| Social | |||||
| Beneficiaries | 200 th. | 97 th. | |||
| Investment BPI "la Caixa" Foundation |
120 M.€ | 40 M.€2 | |||
| Governance | |||||
| Women in management positions3 |
43% | 43% | |||
| 1 Net production (-38 M€) and transformation of Mutual Funds and Insurance into Art.8/9 (1.4 Bn.€) 2 Budget 2022 |
3 Percentage of women in management positions in branches with more than 10 Employees and in all central service functions.
Commitment to People Commitment to Society Commitment to the Environment
Improved compensation and benefits for employees in 2022 and 2023
MoveON Programme (teleworking model)
Trainees Academy
Summer internships for children of Employees
Improved work facilities
Recognition Award for Social Responsibility and Sustainability Practices 2022, in the Voluntary Service category, from APEE, the Portuguese Association for Business Ethics.
Half-day leave from work for Employees to participate
+200 initiatives
2 000 volunteers
direct
+12.8 th.
beneficiaries
8 100 hours of voluntary service
Goods sorting at the Food Bank Against Hunger in Lisbon
Commitment to People Commitment to Society
Commitment to the Environment
"la Caixa" Foundation initiative with the collaboration of BPI
BPI "la Caixa" Foundation Awards 4.6 M.€ | 120 projects supported | 19 th. beneficiaries
Decentralised Social Initiative 1.4 M.€ | 225 projects supported | 48 th. beneficiaries
Promove Programme 3.6 M€ in non-repayable grants | 20 projects and 9 ideas
Initiative for Social Equity | 2.2 M€
Sundry local support 2.1 M.€ | 74 actions supported
Support to refugees from Ukraine
Certification of Environmental Management System of banking and support activities.
Decarbonisation, Renewable Energies, Tourism, Agriculture, Circular Economy and Real Estate
With new proposals and solutions at every step new of your life
Future
Sustainable Offer of Prestige Products
BPI Impacto Clima Funds (Art. 9 - Sustainable Finance Disclosure Regulation)
NEW OFFER RENEWED BET ON THE YOUTH SEGMENT
AGE Junior and AGE Jovem accounts, for young people up to 25 years old.
No maintenance fees and extensive set of cost-free means of operating the account.
Dedicated digital platform in BPI App and bpiage.pt website
The partner for all companies at the various stages of their lives
➢ Virtual IBAN: new solutions
➢ Dedicated Events with Clients
BPI gets AENOR service quality certification in Corporate Banking
Recognition of BPI's Corporate Banking daily work as a competitive value proposition.
▪ In November 2022, BPI became the first Bank to achieve AENOR service quality certification in Corporate Banking, due to the optimisation of its commercial performance model.
| Themes | Dedicated financial solutions | Partnerships | Awards |
|---|---|---|---|
| AGRICULTURE | ▪BPI/EIF Agriculture: guarantee agreement with the EIF Market #1 amount of farming season credit granted (IFAP) share: 65% #1 no. of advances on subsidies (CAP) |
▪ National Agricultural Fair Ovibeja ▪ Colóquio do Milho ▪ |
National Agricultural Awards ▪ 1 321 applications ▪ 10 awards ▪ Personality Award: Salvador Guedes (formerly of Sogrape) |
| TOURISM | ▪ Support Line to Upgrade the Offer 2021 - Turismo de Portugal |
BTL – Lisbon Tourism Fair ▪ ▪Tourism Companies Programme 360 from Turismo de Portugal ▪ NEST – Centro de Inovação do Turismo |
National Tourism Awards ▪ 743 applications 7 awards ▪ Career Award: Jorge Rebelo de ▪ Almeida (Vila Galé Group) |
| INTERNATIONAL TRADE |
▪Credit risk hedging in partnership with COSEC (22% share of global policies) |
BPI-CaixaBank initiatives ▪ "Businesses with the World" (2 editions): 56 meetings between BPI Customers and Caixabank representatives to discuss various markets (Algeria, Egypt, Hong Kong, India, Morocco, UAE, Turkey) ▪ In-Company Sessions Free-of-charge information sessions held at corporate Clients' premises |
BPI WOMAN ENTREPRENEUR AWARDS
STATUS
Supporting young and innovative companies, driving growth and global expansion
6th edition
in Portugal
CaixaBank initiative with the cooperation of Banco BPI and Enisa
148 applications +45% vs previous edition
Applications closed (15 Dec.)
Recognising the professional path, leadership and social responsibility of Portuguese women
Winner: Isabel Azevedo CEO of Fricon
Distinguishing companies that stand out for their performance in innovation, financial strength and sustainability
5th edition 2nd edition 1st edition
BPI jointly promotes this initiative
Encouraging and rewarding innovation initiatives that contribute to the transformation of companies in Portugal
Applications in 2023
More Clients, more sales with digital contribution, and prominent position
26
inContact
(launched in Jan.20)
Omnichannel Customer relationship model with remote personal account manager
11 Centres 124 Account Managers
344 th. Clients
~3.4 Bn.€ business volume
96% acceptance rate
(launched in Oct.22)
BPI VR will be showcased at the Oculus Quest Store and in some BPI branches, where virtual reality equipment will be available.
BPI was elected 'Bank of the Year 2022 in Portugal' by The Banker (Financial Times Group)
01 BPI Ratings versus peers
Income Statements and Balance sheet in accordance with IAS / IFRS and consolidated indicators
Reconciliation between BPI reported figures and BPI Segment contribution to CaixaBank Group 03
04
02
Alternative Performance Measures
| (Long Term Debt/ Issuer Credit Rating) |
(Long Term Debt/ Issuer rating) |
(Issuer Default Rating) |
(Long-Term Debt/ Issuer Rating) |
|
|---|---|---|---|---|
| …AA+ e AAA |
…Aa1, e Aaa |
…AA, AA+ e AAA |
…AA, AA (high), AAA | |
| t n e e |
AA | Mortgage bonds Aa2 |
AA | AA |
| AA- | Aa3 | AA | Mortgage bonds AA (low) |
|
| A+ | A1 | A+ | A (high) | |
| m d st a r |
A | A2 | A | Bank 1 A |
| e G v |
A | A3 Deposits |
Bank 1 A |
A (low) |
| n I |
Bank 1 BBB+ |
Baa1 | Deposits BBB+ Senior debt |
BBB (high) |
| BBB | Bank1 Bank3 Baa2 |
BBB | Bank 3 BBB |
|
| BBB | Bank 2 Baa3 |
Bank 3 BBB |
Bank 2 BBB (low) |
|
| Bank 2 BB+ |
Ba1 | BB+ | BB (high) | |
| t n |
BB | Ba2 | Bank 2 BB |
BB |
| e m |
BB | Ba3 | BB | BB (low) |
| st e d |
B+ | B1 | B+ | Bank 5 B (high) |
| e a v r n g |
B | Bank 4 B2 |
Bank 4 B |
Bank 4 B |
| I - n |
B | Bank 5 B3 |
B | B (low) |
| o N |
CCC+ | Caa1 | CCC+ | CCC (high) |
| CCC | Caa2 | CCC | CCC | |
| S&P (16th Sep.22) upgraded in 1 notch the rating of BPI and its long term senior debt to BBB+, with Stable outlook. |
Moody's (21st Sep.21) upgraded the rating on BPI long term deposits to A3 and maintained the rating on BPI and its LT senior debt at Baa2. The outlook on ratings is Stable. |
Fitch | (8th Jul.22) upgraded the standalone rating to bbb- (investment grade) and reaffirmed the ratings of BPI (BBB), with Stable outlook, and its senior debt and deposits (BBB+). |
| In M € |
Dec 21 |
Dec 22 |
% |
|---|---|---|---|
| Net interest income |
455 6 |
548 5 |
20% |
| Dividend income |
9 1 |
4 1 |
118% |
| Equity accounted income |
23 1 |
24 5 |
6% |
| fee and Net commission income |
288 2 |
295 7 |
3% |
| Gains/(losses) financial and liabilities and other assets on |
10 0 |
25 4 |
154% |
| Other operating income and expenses |
-27 4 |
-40 7 |
-48% |
| income Gross |
751 3 |
857 6 |
14% |
| Staff expenses |
-231 1 |
-238 4 |
3% |
| Other administrative expenses |
-135 6 |
-139 7 |
3% |
| and Depreciation amortisation |
-61 2 |
-67 5 |
10% |
| Recurring operating expenses |
-427 9 |
6 -445 |
4% |
| Non-recurrent costs |
-29 8 |
-21 2 |
-29% |
| Operating expenses |
-457 7 |
-466 8 |
2% |
| operating income Net |
293 6 |
390 8 |
33% |
| Impairment losses and other provisions |
-50 9 |
-67 4 |
32% |
| and losses other Gains in assets |
-0 6 |
-0 1 |
80% |
| income before income Net tax |
242 2 |
323 3 |
33% |
| Income tax |
-63 6 |
-88 7 |
39% |
| Net income |
178 6 |
234 6 |
31% |
1) Includes medium and long-term sovereign debt of 4.7 Bn.€ (Portugal 41%; Spain 21%, Italy 14%, European Union 13% and USA 10%), with an average residual maturity of 3.9 years.
32
| Gross portfolio, in M.€ | Dec 21 | Dec 22 | YoY |
|---|---|---|---|
| I. Loans to individuals | 14 892 | 15 984 | 7% |
| Mortgage loans | 13 089 | 14 183 | 8% |
| Other loans to individuals | 1 803 | 1 800 | 0% |
| II. Loans to companies | 10 523 | 10 945 | 4% |
| III. Public sector | 2 115 | 2 233 | 6% |
| Total loans | 27 529 | 29 161 | 6% |
| Note: | |||
| Loan portfolio net of impairments |
27 008 | 28 630 | 6% |
| Loan portfolio |
Customer resources |
|||||
|---|---|---|---|---|---|---|
| Gross portfolio, in M.€ | Dec 21 | Dec 22 | YoY | € In M |
Dec 21 |
Dec 22 |
| I. Loans to individuals | 14 892 | 15 984 | 7% | deposits I Customer |
28 872 |
30 326 |
| Mortgage loans | 13 089 | 14 183 | 8% | Off-balance sheet II resources |
11 433 |
718 9 |
| Other loans to individuals | 1 803 | 1 800 | 0% | Mutual funds |
6 273 |
325 5 |
| II. Loans to companies | 10 523 | 10 945 | 4% | Capitalisation insurance |
4 588 |
4 313 |
| III. Public sector | 2 115 | 2 233 | 6% | Public offerings |
572 | 81 |
| Total loans | 27 529 | 29 161 | 6% | 40 045 |
||
| Note: | Total | 40 305 |
||||
▪ Additionally, the placement of structured products increased by 412 M.€ in 2022.
| In M.€ | Dec 21 | Dec 22 | % |
|---|---|---|---|
| Net interest income | 460.5 | 559.4 | 21% |
| Dividend income | 99.8 | 91.5 | -8% |
| Equity accounted income | 47.8 | 67.3 | 41% |
| Net fee and commission income | 288.2 | 295.7 | 3% |
| Gains/(losses) on financial assets and liabilities and other | 26.5 | 37.7 | 42% |
| Other operating income and expenses | -35.3 | -47.7 | -35% |
| Gross income | 887.5 | 1 003.9 | 13% |
| Staff expenses | -260.9 | -259.6 | -1% |
| Of which: Recurrent staff expenses | -231.1 | -238.4 | 3% |
| Non-recurrent costs | -29.8 | -21.2 | -29% |
| Other administrative expenses | -135.6 | -139.7 | 3% |
| Depreciation and amortisation | -61.2 | -67.5 | 10% |
| Operating expenses | -457.7 | -466.8 | 2% |
| Net operating income | 429.8 | 537.1 | 25% |
| Impairment losses and other provisions | -50.9 | -76.2 | 50% |
| Gains and losses in other assets | -0.6 | -0.1 | 80% |
| Net income before income tax | 378.4 | 460.8 | 22% |
| Income tax | -71.6 | -95.7 | 34% |
| Net income | 306.8 | 365.0 | 19% |
| M.€ In |
Dec 21 |
Dec 22 |
|---|---|---|
| ASSETS | ||
| Cash and cash balances central banks and other demand deposits at |
6 246 |
2 466 |
| Financial held for trading fair value through profit or loss and fair assets , at at value through other comprehensive income |
884 1 |
613 1 |
| Financial amortised assets at cost Of which: Loans to Customers |
32 138 27 008 |
33 753 28 630 |
| and Investments in joint ventures associates Tangible assets |
274 209 |
269 198 |
| Intangible assets Tax assets |
98 201 |
108 184 |
| Non-current and disposal groups classified as held for sale assets Other assets |
5 323 |
26 288 |
| Total assets |
41 378 |
38 905 |
| LIABILITIES Financial liabilities held for trading Financial liabilities amortised at cost Deposits - Central Banks and Credit Institutions Deposits - Customers Debt securities issued Of which: subordinated liabilities Other financial liabilities Provisions liabilities Tax Other liabilities |
104 37 201 826 5 28 872 2 206 304 296 53 20 334 |
87 34 436 1 421 30 326 2 339 431 349 49 125 343 |
| Total Liabilities |
37 711 |
35 040 |
| Shareholders' equity attributable the shareholders of to BPI Non controlling interests |
3 668 0 |
3 865 0 |
| Total Shareholders' equity |
3 668 |
3 865 |
| Total liabilities and Shareholders' equity |
41 378 |
38 905 |
| Profitability Efficiency and Liquidity Indicators , (Bank of Portugal no. 16/2004 with the amendments of 6/2018) Instruction Instruction |
Dec 21 |
Dec 22 |
|---|---|---|
| / Gross income ATA |
2 2% |
2 4% |
| before and attributable non-controlling / Net income income income interests ATA tax to |
1 0% |
1 1% |
| before and attributable non-controlling / Net income income income interests tax to shareholders' (including non-controlling interests) equity average |
10 7% |
11 9% |
| income 1) Staff / Gross expenses |
26 0% |
23 7% |
| income 1) Operating / Gross expenses |
48 2% |
44 4% |
| (net) deposits ratio Loans to |
94% | 94% |
| ratio and forborne NPE (according the EBA criteria) to |
Dec 21 |
Dec 22 |
| Non-performing (M €) - NPE exposures |
646 | 583 |
| NPE ratio |
1 6% |
1 6% |
| by impairments NPE coverage |
84% | 94% |
| by and collaterals NPE impairments coverage |
149% | 155% |
| NPE 2) of forborne Ratio included in not |
0 4% |
0 4% |
| "Crédito duvidoso" (non-performing loans) (according Bank of criteria) to Spain |
Dec 21 |
Dec 22 |
| €) 3) "Crédito duvidoso" (M |
683 | 589 |
| "Crédito duvidoso" ratio |
2 3% |
9% 1 |
| "Crédito duvidoso" by impairments coverage |
80% | 93% |
| "Crédito duvidoso" by and collaterals impairments coverage |
140% | 153% |
36
2) Forborne according to EBA criteria. On December 2022, the forborne was 362 M.€ (forborne ratio of 0.9%), of which 149 M.€ was performing loans (0.4% of the gross credit exposure) and 212 M.€ was included in NPE (0.5% of the gross credit exposure).
3) Includes guarantees provided (recorded off-balance sheet).
1) Excluding early-retirement costs.
| Profit & loss account |
BPI | Business segment | |||
|---|---|---|---|---|---|
| Dec 22 (M.€) | As reported by BPI |
Adjustments 1 ) |
contribution to CABK Group |
BPI | Corporate Center |
| Net interest income | 559 | ( 5) | 554 | 544 | 11 |
| Dividends | 91 | 0 | 92 | 4 | 87 |
| Equity accounted income | 67 | 0 | 67 | 25 | 43 |
| Net fees and commissions | 296 | ( 0) | 296 | 296 | |
| Trading income | 38 | 2 | 39 | 27 | 12 |
| Other operating income & expenses | ( 48) | 3 | ( 45) | ( 38) | ( 7) |
| Gross income | 1 004 | ( 1) | 1 003 | 857 | 146 |
| Recurrent operating expenses | ( 446) | ( 9) | ( 455) | ( 455) | |
| Extraordinary operating expenses | ( 21) | 21 | |||
| Pre-impairment income | 537 | 11 | 548 | 402 | 146 |
| [Pre-impairment income without extraordinary expenses] |
558 | ( 10) | 548 | 402 | 146 |
| Impairment losses on financial assets | ( 61) | 55 | ( 6) | ( 6) | 0 |
| Other impairments and provisions | ( 16) | ( 15) | ( 31) | ( 22) | ( 9) |
| Gains/losses on disposals & others | ( 0) | 0 | ( 0) | ( 0) | |
| Pre-tax income | 461 | 51 | 511 | 374 | 138 |
| Income tax | ( 96) | ( 13) | ( 109) | ( 101) | ( 8) |
| Profit for the period | 365 | 37 | 402 | 272 | 130 |
| Minority interests & other | ( 0) | 0 | |||
| Net income | 365 | 37 | 402 | 272 | 130 |
| December 2022 (M.€) |
reported by As BPI |
Adjustments | BPI contribution to (BPI segment) CABK Group |
|---|---|---|---|
| and advances Loans to customers, net |
28 630 |
( 67) |
28 563 |
| Total funds customer |
40 045 |
(4 391) |
35 654 |
The difference between the earnings released by BPI and the earnings attributable to CaixaBank Group is largely a result of consolidation adjustments and the net change in the fair value adjustments generated from the business combination.
Additionally, BPI contribution to CaixaBank Group results is broken down into BPI segment and Corporate Center segment, the latter including the contributions from BFA and BCI.
The difference between BPI reported figures and those reported by CaixaBank for the BPI segment can largely be explained by:
1) Consolidation, standardisation and net fair value adjustments in the business combination.
The following table shows, for the consolidated profit & loss account, the reconciliation of the structure used in this document (Results' Presentation) with the structure adopted in the financial statements and respective notes of the Report and Accounts.
| Adopted acronyms and designations | Units, conventional sings and abbreviations |
|||
|---|---|---|---|---|
| YtD | Year-to-date change | €, Euros, EUR | euros | |
| YoY | Year-on-year change | th.€, th.euros | thousand euros | |
| QoQ | quarter-on-quarter change | M.€, M.euros | million euros | |
| ECB | European Central Bank | Bn.€, Bi.€ | billion euros | |
| BoP | Bank of Portugal | | change | |
| CMVM | Securities Market Commission | n.a. | not available | |
| APM | Alternative Performance Measures | 0, – | null or irrelevant | |
| MMI | Interbank Money Market | vs. | versus | |
| T1 | Tier 1 | b.p. | basis points | |
| CET1 | Common Equity Tier 1 | p.p. | percentage points | |
| RWA | Risk weighted assets | E | Estimate | |
| TLTRO | Targeted longer-term refinancing operations | F | Forecast | |
| LCR | Liquidity coverage ratio | |||
| NSFR | Net stable funding ratio |
| Structure used in the Results' Presentation | Dec 22 | Dec 22 | Structure presented in the financial statements and respective notes |
|---|---|---|---|
| Net interest income | 559.4 | 559.4 | Net interest income |
| Dividend income | 91.5 | 91.5 | Dividend income |
| Equity accounted income | 67.3 | 67.3 | Share of the profit or (-) loss of investments in subsidiaries, joint ventures and associates accounted for using the equity method |
| Net fee and commission income | 295.7 | 323.3 | Fee and commission income |
| -27.6 | Fee and commission expenses | ||
| Gains/(losses) on financial assets and liabilities and other | 37.7 | 0.7 | Gains or (-) losses on derecognition of financial assets and liabilities not measured at fair value through profit or loss, net |
| 14.8 | Gains or (-) losses on financial assets and liabilities held for trading, net | ||
| -3.1 | Gains or (-) losses on non-trading financial assets mandatorily at fair value through profit or loss, net | ||
| -3.0 | Gains or (-) losses from hedge accounting, net | ||
| 28.1 | Exchange differences [gain or (-) loss], net | ||
| Other operating income and expenses | -47.7 | 28.1 | Other operating income |
| -75.8 | Other operating expenses | ||
| Gross income | 1 003.9 | 1 003.9 | GROSS INCOME |
| Staff expenses | -259.6 | -259.6 | Staff expenses |
| Other administrative expenses | -139.7 | -139.7 | Other administrative expenses |
| Depreciation and amortisation | -67.5 | -67.5 | Depreciation |
| Operating expenses | -466.8 | -466.8 | Administrative expenses and depreciation |
| Net operating income | 537.1 | 537.1 | |
| Impairment losses and other provisions | -76.2 | -9.9 | Provisions or (-) reversal of provisions |
| -66.3 | Impairment or (-) reversal of impairment on financial assets not measured at fair value through profit or loss | ||
| Gains and losses in other assets | -0.1 | Impairment or (-) reversal of impairment of investments in subsidiaries, joint ventures and associates | |
| 0.9 | Impairment or (-) reversal of impairment on non-financial assets | ||
| 0.0 | Gains or (-) losses on derecognition of investments in subsidiaries, joint ventures and associates, net | ||
| -0.8 | Gains or (-) losses on derecognition of non financial assets, net | ||
| -0.3 | Profit or (-) loss from non-current assets and disposal groups classified as held for sale not qualifying as discontinued operations | ||
| Net income before income tax | 460.8 | 460.8 | PROFIT OR (-) LOSS BEFORE TAX FROM CONTINUING OPERATIONS |
| Income tax | -95.7 | -95.7 | Tax expense or income related to profit or loss from continuing operations |
| Net income from continuing operations | 365.0 | 365.0 | PROFIT OR (-) LOSS AFTER TAX FROM CONTINUING OPERATIONS |
| Net income from discontinued operations | Profit or (-) loss after tax from discontinued operations | ||
| Income attributable to non-controlling interests | Profit or (-) loss for the period attributable to non-controlling interests | ||
| Net income | 365.0 | 365.0 | PROFIT OR (-) LOSS FOR THE PERIOD ATTRIBUTABLE TO OWNERS OF THE PARENT |
| EARNINGS, EFFICIENCY AND PROFITABILITY INDICATORS | The following earnings, efficiency and profitability indicators are defined by reference to the above structure of the profit and loss account used in this document. |
|---|---|
| Gross income | Net interest income + Dividend income + Net fee and commission income + Equity accounted income + Gains/(losses) on financial assets and liabilities and other + Other operating income and expenses |
| Commercial banking gross income | Net interest income + Dividend income + Net fee and commission income + Equity accounted income excluding the contribution of stakes in African banks |
| Operating expenses | Staff expenses + Other administrative expenses + Depreciation and amortisation |
| Net operating income | Gross income – Operating expenses |
| Net income before income tax |
Net operating income – Impairment losses and other provisions + Gains and losses in other assets |
| Cost-to-income ratio (efficiency ratio) 1) |
Operating expenses / Gross income |
| Cost-to-core income ratio (core efficiency ratio)1) |
[Operating expenses, excluding costs with early-retirements and voluntary terminations and (only in 2016) gains with the revision of the Collective Labour Agreement (ACT) – Income from services rendered to CaixaBank Group (recorded under Other operating income and expenses)] / Commercial banking gross income |
| Return on Equity (ROE)1) | Net income for the period, less the interest cost of AT1 capital instruments recorded directly in shareholders' equity / Average value in the period of shareholders' equity attributable to BPI shareholders, excluding AT1 capital instruments |
| Return on Tangible Equity (ROTE) | 1) Net income for the period, less the interest cost of AT1 capital instruments recorded directly in shareholders' equity / Average value in the period of shareholders' equity attributable to BPI shareholders (excl. AT1 capital instruments) after deduction of intangible net assets and goodwill of equity holdings |
| Assets (ROA)1) Return on |
(Net income attributable to BPI shareholders + Income attributable to non-controlling interests - preference shares dividends paid) / Average value in the period of net total assets |
| Unitary intermediation margin | Loan portfolio average interest rate, excluding loans to employees – Deposits average interest rate |
| BALANCE SHEET AND FUNDING INDICATORS | |
| On-balance sheet Customer resources2) |
Deposits + Capitalisation insurance of fully consolidated subsidiaries + Participating units in consolidated mutual funds ▪ Deposits = Demand deposits and other + Term and savings deposits + Interest payable + Retail bonds (Fixed rate bonds placed with Customers) ▪ Capitalisation insurance of fully consolidated subsidiaries (BPI Vida e Pensões sold on Dec.17) |
| Off-balance sheet Customer resources3) |
Mutual funds + Capitalisation insurance + Pension plans + Subscriptions in public offerings ▪ Mutual funds = Unit trust funds + Real estate investment funds + Retirement-savings and equity-savings plans (PPR and PPA) + Hedge funds + Assets from the funds under BPI Suisse management + Third-party unit trust funds placed with Customers. ▪ Capitalisation insurance4) = Third-party capitalisation insurance placed with Customers ▪ Pension plans4) = Pension plans under BPI management (includes BPI pension plans) ▪ Subscriptions in public offerings = Customers subscriptions in third parties' public offerings |
(1) Ratio referring to the last 12 months, except when indicated otherwise. The ratio can be computed for the cumulative period since the beginning of the year, in annualised terms.
(2) The amount of on-balance sheet Customer resources is not deducted from the applications of off-balance sheets products (mutual funds and pension plans) in on-balance sheet products.
(3) Amounts deducted from participating units in the Group banks' portfolios and from off-balance sheet products investments (mutual funds and pension plans) in other off-balance sheet products. (4) Following the sale of BPI Vida e Pensões in Dec.17, the capitalisation insurance placed with BPI's Customers are recorded off balance sheet, as "third-party capitalisation insurance placed with customers" and pension funds management is excluded from BPI's consolidation perimeter.
| BALANCE SHEET AND FUNDING INDICATORS (continuation) | |
|---|---|
| Total Customer resources | On-balance sheet Customer resources + Off-balance sheet Customer resources |
| Gross loans to customers | Gross loans and advances to Customers (financial assets at amortised cost), excluding other assets (guarantee accounts and others) and reverse repos + Gross debt securities issued by Customers (financial assets at amortised cost) Note: gross loans = performing loans + loans in arrears + receivable interests |
| Net loans to Customers | Gross loans to Customers – Impairments for loans to Customers |
| Loan-to-deposit ratio (CaixaBank criteria) | (Net loans to Customers - Funding obtained from the EIB, which is used to provide credit) / Deposits and retail bonds |
| ASSET QUALITY INDICATORS | |
| Impairments and provisions for loans and guarantees (income statement) |
Impairment or reversal of impairment on financial assets not measured at fair value through profit or loss relative to loans and advances to Customers and to debt securities issued by Customers (financial assets at amortised cost), before deduction of recoveries of loans previously written off from assets, interest and others + Provisions or reversal of provisions for commitments and guarantees |
| Cost of credit risk | Impairments and provisions for loans and guarantees - Recoveries of loans previously written off from assets, interest and other |
| Cost of credit risk as % of loan portfolio1) (Impairments and provisions for loans and guarantees - Recoveries of loans previously written off from assets, interest and other) / Average value in the period of the gross loans and guarantees portfolio. |
|
| Performing loans portfolio | Gross Customer loans - (Overdue loans and interest + Receivable interests and other) |
| NPE and NPL ratios | Ratio of non-performing exposures (NPE) and ratio of non-performing loans (NPL) in accordance with the EBA criteria (prudential perimeter) |
| Coverage of NPE or NPL | [Impairments for loans and advances to Customers (financial assets at amortised cost) + Impairments for debt securities issued by Customers (financial assets at amortised cost) + Impairments and provisions for guarantees and commitments] / [Non-performing exposures (NPE) or Non-performing loans (NPL)] |
| Coverage of NPE or NPL by impairments and associated collaterals |
[Impairments for loans and advances to Customers (financial assets at amortised cost) + Impairments for debt securities issued by Customers (financial assets at amortised cost) + Impairments and provisions for guarantees and commitments + Collaterals associated to NPE or NPL] / [Non-performing exposures (NPE) or Non-performing loans (NPL)] |
| Non-performing loans ratio ("credito dudoso", Bank of Spain criteria) |
Non performing loans ("credito dudoso", Bank of Spain criteria) / (Gross Customer loans + guarantees) |
| Non-performing loans coverage ratio |
[Impairments for loans and advances to Customers (financial assets at amortised cost) + Impairments for debt securities issued by Customers (financial assets at amortised cost) + Impairments and provisions for guarantees and commitments] / Non performing loans ("credito dudoso", Bank of Spain criteria) |
| Coverage of non-performing loans by impairments and associated collaterals |
[Impairments for loans and advances to Customers (financial assets at amortised cost) + Impairments for debt securities issued by Customers (financial assets at amortised cost) + Impairments and provisions for guarantees and commitments + Collateral associated to credit] / Non performing loans ("credito dudoso", Bank of Spain criteria) |
| Impairments cover of foreclosed properties |
Impairments for real estate received in settlement of defaulting loans / Gross value of real estate received in settlement of defaulting loans |
41
BANCO BPI, S.A. Registered office: Avenida da Boavista 1117, Porto, Portugal Share capital: € 1 293 063 324.98 Registered at Commercial Registry of Porto under registration number PTIRNMJ 501 214 534 and tax identification number 501 214 534
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