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Banco Comercial Portugues

Investor Presentation Oct 27, 2021

1913_iss_2021-10-27_e9b9933a-b9b9-4b57-be14-b645a033b49f.pdf

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EARNINGS PRESENTATION

l The information in this presentation has been prepared under the scope of the International Financial Reporting Standards ('IFRS') of BCP Group for the purposes of the preparation of the consolidated financial statements under Regulation (CE) 1606/2002, as amended.

l The figures presented do not constitute any form of commitment by BCP in regard to future earnings.

l Figures for the first 9 months of 2021 not audited.

l Due to changes in the accounting policies of Bank Millennium (Poland), the previously published financial statements were restated from 1 January 2020 for comparability.

l The information in this presentation is for information purposes only, and should be read in conjunction with all other information made public by the BCP Group.

Highlights

Highlights: resilience of the business model

▪ Strong liquidity, well in excess of regulatory requirements, and eligible assets for ECB funding of 25.2 billion

Highlights: resilience of the business model

Growing Customer base, mobile Customers standing out

Growth in mobile demonstrates the capacity for innovation and adaptation

% Mobile Customers1 % Digital Transactions (#)3 % Digital Sales (#) # Digital Interactions 4 (mio)2

1 Customer counting criteria used in the 2024 Strategic Plan

2 Interactions (Millennium website and app)

3 Includes mobile, online and ATMs, excludes branches

4 Digital sales (Millennium website and app) in number of operations

Best Digital Bank and Leader in Customer Satisfaction in 2021

54.7
44.1 45.6 49.0
40.1 41.0 49.2
Bank 2 38.7 28.9 35.0 39.5
Bank 3 28.8 44.3 47.7 50.3
Bank 4 37.4
Bank 5 33.0 42.0 38.8 41.8
2018 2019 2020 2021
(YtD
Sep.)

"Best Digital Bank"

Unaided nomination by Customers2 , Q3'21 YtD

2 Which bank do you choose as the 'Best Digital Bank'? (Unaided reply) | Sample: Banking sector, total number of banking Customers, aged> 15 years - 70 years, Portugal (N 2021 = 2,000 per quarter; 8,000 per year)

Incorporation of ESG dimensions into the operations and the business model

100% green Electricity consumption in Portugal

Exclusion or conditioning of financing to projects within the categories and/or sectors of activity alien to the responsible financing principles of Millennium bcp

Origination and placement of green debt issues in the corporate segment

ESG initial issue 500M€ social bonds

E S G

Diversity and Equal Opportunities Policy

Gender Equality policy

Millennium bcp Foundation social action

Net income of 59.5 million in the first nine months of 2021

(Million
euros)
9M20 9M21 YoY Impact
on
earnings
Net
interest
income
1
153
7
,
1
168
6
,
+1
3%
+15
0
Commissions 498
2
534
2
2%
+7
+36
1
Core
income
1
651
8
,
1
702
8
,
+3
1%
+51
0
Operating
costs
-812
7
-851
7
+4
8%
-39
0
Of
which:
recurring
-785
2
-764
1
-2
7%
+21
0
Recurrent
operating
profit
core
866
7
938
7
+8
3%
+72
1
Other
income*
10
9
3
6
-67
3%
-7
3
Operating
income
net
850
0
854
7
+0
6%
+4
7
Impairment
and
other
provisions
-550
6
-726
1
+31
9%
-175
4
Of
which:
legal
risk
CHF
(Poland)**
mortgages
on
-67
2
-313
5
+366
2%
-246
3
Net
income
before
income
tax
299
4
128
6
-57
0%
-170
8
Income
taxes***
, non-controlling
interests
and
discontinued
operations
-153
1
-69
1
-54
8%
+83
9
income
Net
146
3
59
5
-59
3%
-86
8
income
excluding
provisions
for
legal
risk
CHF
(Poland)**
Net
mortgages
on
180
0
215
3
+19
6%
+35
4

*Dividends from equity instruments, other net operating income, net trading income and equity accounted earnings. | **Does not include provisions for legal risk on CHF mortgages of Euro Bank (guaranteed by Société Générale): 32.8 million in 9M'21. | ***Includes impact of provisions for legal risk on CHF mortgages in Poland (amount not considered tax deductible in 9M'21: 300.8 million) and of mandatory contributions (non-tax-deductible amounts in 9M'21: 39.3 million in Portugal and 72.9 million in Poland).

Net interest income

Fees and commissions

300.7 318.2 51.8 58.4 352.5 376.6 9M20 9M21 22.8 23.1 145.7 157.6 +6.8% +12.7% +5.8% +8.2% +1.4% International operations (Million euros) (Million euros)

122.9 134.5

+9.5%

9M20 9M21

Other income

15 9M'20: other operating income includes 4.3 million losses, net of intermediation fees, on the sale of real-estate and other assets; 9M'21: other operating income includes 4.3 million gains, net of intermediation fees, on the sale of real estate and other assets; +32.8 million compensation for provisions for legal risk on CHF mortgages of Euro Bank (guaranteed by Société Générale).

Operating costs

16 *9M'20: compensation of 5.8 million for temporary salary cuts in Portugal, headcount adjustment costs of 10.0 million in Portugal, Euro Bank integration costs of 11.8 million (international operations); 9M'21: headcount adjustment costs of 87.6 million in Portugal.

Cost of risk and provisions

17 *Cost of risk adjusted by one-off reversals of 79bp in Portugal and of 47bp in the international operations. | **Does not include provisions for legal risk on CHF mortgages of Euro Bank (guaranteed by Société Générale): 32.8 million in 9M'21.

Relevant reduction of NPEs under a complex context

*By loan-loss reserves, expected loss gap and collaterals.

NPE include loans to Customers only, except if otherwise indicated.

Customer funds keep growing

*Deposits, debt securities, assets under management, assets placed with Customers and insurance products (savings and investments).

Continued increase of the loan portfolio

Group Capital and liquidity

Capital above regulatory requirements

Total capital of 15.3%* (fully implemented) as of September 2021, above SREP requirements

Surplus of 2.0pp between the total capital ratio and the SREP requirement not using the capital conservation and the O-SII buffers, and of 5.1pp if such buffers are used

  • CET1 capital ratio of 12.0%* (fully implemented) as of September 2021
  • MDA buffer at 0.9 billion above the level at which there are restrictions on the maximum distributable amount of results, in accordance with banking regulation

*Including expected impact of ongoing sale of operation and unaudited net income for the first 9 months of 2021. **Minimum phased-in regulatory requirements from March 12, 2020.

Capital at adequate levels

Leverage ratio

(Fully implemented, latest available data)

Leverage ratio at 6.2% as of September 2021, a comfortable and comparatively strong figure in European banking

RWA density

(RWAs as a % of assets, latest available data)

High RWA density (51% as of September 2021), compared to lower figures in most European banking markets

Reinforced liquidity position

Portugal

Resilient profitability in Portugal

Net operating revenue

(Million euros)

  • Net income of 115.2 million in the first 9 months of 2021
  • Net income was driven by stronger core income and by headcount adjustment costs

Net interest income

(Million euros)

Net interest income stood at 619.5 million in the first 9 months of 2021, up 4.8% (+28.3 million) from 591.2 million in the same period of 2020. The positive impacts of the growing performing portfolio, lower wholesale funding cost (influenced by the TLTRO impact) and of the continued decline in the remuneration of time deposits, have more than compensated for the negative impacts of the loan portfolio (influenced by the negative evolution of Euribor), reduction of NPEs, excess liquidity and lower yields of the securities portfolio.

Continued reduction of the cost of deposits

2.69% 2.64% 9M20 9M21 Spread on the performing loan book (vs 3m Euribor) (average) -0.39% -0.54%

  • Spread of the portfolio of term deposits of -0.57% in the first 9 months of 2021 (-0.51% in the same period of 2020); Customer rate down to 0.02% in the first 9 months of 2021 from 0.11% in the same period of 2020
  • Spread on the performing loan portfolio stood at 2.64% in the first 9 months of 2021, compared to 2.69% in the same period of 2020
  • NIM stood at 1.45%

Commissions and other income

9M20 9M21 YoY
300.7 318.2 +5.8%
73.1 80.3 +9.9%
76.2 78.7 +3.3%
62.7 63.9 +1.9%
83.3 89.1 +7.0%
5.3 6.1 +15.7%
51.8 58.4 +12.7%
39.0 39.7 +1.7%
12.8 18.8 +46.4%
352.5 376.6 +6.8%

(Million euros) Commissions Other income

(Million euros) (Million euros)

30 9M'20: other operating income includes 6.0 million losses, net of intermediation fees, on the sale of real-estate and other assets; 9M'21: other operating income includes 4.1 million gains, net of intermediation fees, on the sale of real estate and other assets.

Operating costs

*9M'20: compensation of 5.8 million for temporary salary cuts and headcount adjustment costs of 10.0 million; 9M'21: headcount adjustment costs.

Continued decrease of NPEs

Non-performing exposures (NPE)

(Million euros)

NPE build-up

Sep
21
Sep
21
(Million
euros)
vs.Sep
20
vs.Dec
20
Opening
balance
2
701
,
2
363
,
outflows/inflows
Net
13 13
Write-offs -228 -208
Sales -555 -238
Ending
balance
931
1
,
931
1
,
  • NPEs in Portugal total 1.9 billion at end-September 2021, 0.8 billion down from September 2020 and 0.4 billion down from end-2020
  • The decrease from September 2020 results from net inflows of 0.01 billion, write-offs of 0.2 billion and sales of 0.6 billion
  • The decrease of NPEs from September 2020 is attributable to a 0.5 billion reduction of NPL>90d and to a 0.3 billion decrease of other NPEs
  • Cost of risk of 68bp in the first 9 months of 2021 (90bp in the first 9 months of 2020), with a reinforcement of NPE coverage by loan-loss reserves to 69% from 61%, respectively

NPE coverage

  • Total coverage*≥100% for both NPE categories (NPL>90d and other NPE)
  • Coverage by loan-loss reserves is stronger in loans to companies, where real-estate collateral, usually more liquid and with a more predictable market value, accounts for a lower coverage than in loans to individuals: coverage by loan-losses was 80% for companies NPE as of September 2021, reaching 118% for companies NPL>90d (96% and 150%, respectively, if cash, financial collateral and expected loss gap are included)

Foreclosed assets and corporate restructuring funds

726 700 124 89 850 789 RE/tourism Industry -7.2% Corporate restructuring funds (Million euros)

Sep 20 Sep 21

• Net foreclosed assets were down by 33.2% between September 2020 and September 2021. Valuation of foreclosed assets by independent providers exceeded book value by 31%

  • 1,376 properties were sold during the first 9 months of 2021 (1,511 properties in the first 9 months of 2020), with sale values exceeding book values by 16 million
  • Corporate restructuring funds decreased 7.2% to 789 million at end-September 2021. The original credit exposure on these funds totals 2,006 million, with total reserves (original credit, plus restructuring funds) corresponding to a 61% coverage

Growing customer funds and loans to customers

Performing credit grows in Portugal

  • Performing credit portfolio in Portugal up by 2.2 billion (+6.2%) from September 2020
  • Strong support to companies, which accounted for 56% of the total performing loan growth from September 2020
  • ✓ Credit lines to support the economy of 2.9 billion with European guarantees, including the 1.7 billion reinforcement celebrated in October, to support small and medium-sized companies affected by the pandemic
  • Main bank for companies (DataE 2020); most appropriate products; most efficient; best; closest to Customers
  • 19% market share (up to August 2021) in the placement of loans with State guarantees, in partnership with Banco Português de Fomento (BPF)
  • Leading bank in Factoring and Confirming: factoring invoicing of 6.1 billion in the first 9 months of 2021 and market share of 27%*
  • Leading bank in Leasing: 348 million new leasing business in the first 9 months of 2021 and market share of 19%*

Moratoriums

(Million euros)

Moratoriums
expired
in September
Moratoriums
to expire
after September
Families 3
096
,
106
Companies 3
115
,
624
TOTAL 6
211
,
730

Breakdown by stages Breakdown by stages

(Moratoriums expired in September and to expire after September)

90% of outstanding moratoriums in September are performing

After September, there will be 730 million in active moratoriums (106 million to families, mortgages represent 98%; and 624 million to companies)

Moratoriums to expire from September Evolution of moratoriums expired between March and June 2021

(Private moratoria; million euros)

Amount %
Personal 291 46%
Mortgage 339 54%
TOTAL 630

• Behavior of the expired moratoriums portfolio reflects prudent approach

Breakdown by stages aligned with pre-expiration levels

International operations

Contribution from international operations to consolidated net income

(Million euros*)

9M20 9M21
29
0
-181
2
61
3
-5
9
88
1
-125
7
-34
2
70
0
0
5
--
54
4
-55
7
59
3
-0
2

Net earnings affected by provisions for legal risk on CHF loans

587.4 580.1 9M20 9M21 Net operating revenue (Million euros*) -1.2%

  • Adjusted net income** up by 51.5%, despite the 0.6pp decrease of the 3m WIBOR
  • Net losses of 181.2 million, affected by 311.1 million provisions for legal risk on CHF loans
  • Continued implementation of measures to rationalise the workforce and to optimise geographic presence: reduction of 811 employees and 61 branches
  • Strong franchise, as demonstrated by the increase of Customers funds by 6.0% and of loans to Customers by 6.4%
  • CET1 ratio of 15.1% with total capital of 18.2%

Significant reduction of operating costs

145.9 135.0 117.1 108.8 30.9 22.2 293.9 266.0 -9.5% -7.5% -7.1% Staff costs Other Resol. Fund and DGF Operating costs (Million euros*)

9M20 9M21

Commissions and other income

(Million euros**; does not include tax on assets and contribution to the resolution fund and to the DGF)

Credit quality

  • Coverage of NPL>90d by loan-loss reserves at 128% (116% as of September 2020)
  • Cost of risk of 36bp, compared to 92bp in the first 9 months of 2020,which included Covid-19 provisions

Increased Customers funds and loans to Customers

CHF mortgages

44

*Excludes Euro Bank. | *FX effect excluded. €/CHF constant at September 2021 levels: Balance Sheet 1.08. €/Zloty constant at September 2021 levels: Income Statement 4.54; Balance Sheet 4.60. | **Average for 9 largest banks listed in the Warsaw Stock Exchange, excluding PKO's Q4'20 provisions for conversion.

Net income reflects resilience in challenging environment

Net operating revenue

(Million euros*)

  • Net income of 61.3 million in the first 9 months of 2021
  • Customer funds grew 7.5%; loans to Customers decreased by 14.8%
  • Capital ratio of 48.7%

Increased net interest income and commissions

**Excludes employees from SIM (insurance company)

*FX effect excluded. €/Metical constant at September 2021 levels: Income Statement 79.47; Balance Sheet 74.29.

Credit quality

  • with coverage by loan-loss reserves of 76% on the same date
  • Cost of risk of 141bp in the first 9 months of 2021 (197bp in the same period of 2020)

Business volumes

Loans to Customers (gross)

(Million euros*)

Key figures

Strategic Plan: Excelling 24

9M 2021 2024
C/I ratio 50%
(45% excluding non-usual costs)
≈40%
Cost of risk 60 bp
(69 bp excluding one-off reversals)
≈50 bp
RoE 1.4% ≈10%
CET1 ratio 11.8%
(12.0% pro forma*)
>12.5%
NPE ratio 4.9% ≈4%
Share of mobile Customers 55% >65%
Growth of high engagement
Customers** (vs 2020)
+3% +12%
Average ESG rating*** 75% >80%

50 *Including expected impact of ongoing sale of operation and unaudited net income for the first 9 months of 2021. | **Active Customers with card transactions in the previous 90 days or funds > €100 (>MZM 1,000 in Mozambique) | ***Average of Top 3 indices (DJSI, CDP and MSCI) | NPE include loans to Customers only.

Millennium bcp Foundation Society Sustainability

Santa Clara church: Built in the 1st half of the 15th century, within the city walls of Porto, it is one of the most beautiful examples of Johannine baroque. After a recovery and restoration intervention, which has been ongoing since 2014, it reopens in October 2021.

Estudo "Património Cultural em Portugal: Avaliação do Valor Económico e Social" Tremor festival: A musical experience in the center of the Atlantic (Azores – São Miguel), which combines music, territory and the arts. The Millennium bcp Foundation is a patron of artistic residencies. It took place from the 7th to the 11th of September.

Eça de Queiroz Foundation literary award/Millennium bcp Foundation: aims to encourage the production of literary works in Portuguese. Frederico Pedreira was this year's winner, with the work "A Lição do Sonâmbulo".

Pédipédia: free online pediatric medicalsurgical encyclopedia. It is presented in two complementary versions, one for health professionals and other for parents and caregivers of children and young people.

Millennium bcp Literacy Program for the senior population. The objective is to transmit to the target population a set of basic notions that will allow them to carry out a set of essential banking operations through online channels.

Palácio Nacional da Ajuda: : restoration of the Royal Family Dining Room Cup and the Queen's Kitchen for the musealization of the most representative collections of objects related to the "table arts", which include ceramic, jewlery and textile items.

Millennium bcp subscribes manifesto "Rumo à COP26" promoted by BCSD Portugal, joining an appeal from more than 80 national companies to accelerate the process of decarbonisation of the economy and to comply with the Paris Agreement.

Millennium bcp concludes its participation in the 2021 edition of the Portugal Chama and Raposa Chama national campaign (for younger people), materializing its

Millennium bcp carries out its first issue of senior debt with a Social function, in the amount of 500 million, in line with its ESG (Environmental, Social and Governance) business strategy and its 2021 Sustainability Master Plan (PDS).

Millennium bcp launches a Sustainability Course directed to all the Bank's Employees in Portugal, adjusting internal skills to a new reality arising from the accelerated growth of Sustainable Finance and the applicable regulatory framework.

Millennium bcp integrates the Steering Committee of the WEP (Women's Empowerment Principles) of the Portuguese Network of the United Nations Global Compact, integrating the national effort to promote gender equality and opportunities.

Millennium bcp obtains an "A-" classification on the Refinitiv ESG Combined Score, an evaluation of the performance of Sustainability, another recognition of the Bank's work in this area and which places it in the top 3 of Portuguese companies.

Awards in 2021

Millennium bcp : "PME Líder'20 " programme : largest number of awards among participating banks ( 3rd year in a row)

Millennium bcp : Main bank for companies ; most appropriate products ; most efficient ; best ; closest to Customers

Millennium bcp : Best bank for companies in Portugal and Best digital bank Portugal (Brand Score Q3 '21 )

Millennium bcp : Book Runner Equity and Local market in Equity awards

Millennium bcp : Leader of the 1st edition of the "Inovadora COTEC" program

Millennium bcp : Best Consumer Social Media Marketing and Services, Best in Consumer lending, Best Corporate/Institutional Information Security and Fraud Management in Western Europe, in 2021 . Best FX Provider 2021 in Portugal

Millennium investment banking : Europe M&A deal of the year for advisory services on the acquisition of a shareholding in Brisa

Millennium bim : Best Bank 2021 in Mozambique

Millennium bim : The Innovators 2021 award, "outstanding innovations in payments" category for the Pay IZI solution

Millennium bim : Best Digital Bank, Best FX Provider e Best trade finance provider 2021 in Mozambique

Bank Millennium : The Innovators 2021 award , "outstanding innovations in reatil banking " category , for the Open Banking Services solution

2

: Best Bank, Best Digital Bank

nd in Poland's Best

e

: ranked

Bank Millennium Employer ranking, banking and financial services category

Bank Millennium

Best FX Provider 2021 in Polónia

Bank Millennium : Climate Leaders Poland 2021 (best ranked bank, 2 nd among all companies in reduction of greenhouse gases)

Bank Millennium : CSR golden leaf award

Bank Millennium : ranked 3 rd in the Best 200 Polish Brands ranking, prepared by the Forbes magazine (best ranked bank )

Bank Millennium : 1 st in the "Mortgage Loans" category, 2 nd in "Corporate Social Responsability " and 3 rd in the "Best Quality in Multichannel Service" category

Bank Millennium : among the 10 most digitally advanced European banks in Bain & Company's ranking

Millennium bcp Consumer Choice 2021, "Large banks" category

Millennium bcp Best ranked company in Portugal in The World's Best Employers 2021 ranking

Millennium bcp Best Consumer Digital Bank in Portugal

Millennium bcp Part of Europe's Climate Leaders 2021 ranking

ActivoBank Consumer Choice 2021, "Digital banks" category

Appendix

Sovereign debt portfolio

(Consolidated, million euros)

Sep
20
Dec
20
Mar
21
Jun
21
Sep
21
YoY QoQ
Portugal 8,057 7,742 8,420 9,152 8,069 +0% -12%
T-bills
and
other
1,052 384 514 1,129 497 -53% -56%
Bonds 7,004 7,358 7,906 8,023 7,572 +8% -6%
Poland 5,463 4,066 4,303 4,235 4,042 -26% -5%
Mozambique 302 350 431 462 494 +64% +7%
Other 2,756 2,913 2,912 4,977 4,981 +81% +0%
Total 16,578 15,072 16,066 18,827 17,585 +6% -7%

Sovereign debt portfolio Sovereign debt maturity

The sovereign debt portfolio totalled 17.6 billion, 14.8 billion of which maturing in more than 2 years

The Portuguese sovereign debt portfolio totalled 8.1 billion, whereas the Polish and Mozambican portfolios amounted to 4.0 billion and to 0.5 billion, respectively; "other" includes sovereign debt from Spain (1.6 billion), Italy (1.1 billion), France (1.0 billion), Belgium (0.5 billion), Ireland (0.5 billion) and USA (0.2 billion)

Sovereign debt portfolio

(Million euros)

Portugal Poland Mozambique Other Total
Trading
book
497 33 0 13 543
1

year
491 6 0 0 497
1
and
2
>
year

years
0 3 0 0 3
2
and
5
>
years

years
6 12 0 0 18
5
and
8
years
years
>
0 8 0 1 9
8
and
10
years

years
>
0 3 0 10 13
10
>
years
0 1 0 2 3
Banking
book*
7
572
,
4
009
,
494 4
967
,
17
042
,
1

year
31 1
044
,
118 20 1
213
,
1
and
2
>
year

years
66 998 57 1 1
122
,
2
and
5
>
years

years
2
252
,
1
812
,
215 1
594
,
5
873
,
5
and
8
>
years

years
4
407
,
153 36 1
354
,
5
949
,
and
8
10
years

years
>
524 2 0 816 1
342
,
10
years
>
292 1 68 1
183
,
1
544
,
Total 8
069
,
4
042
,
494 4
981
,
17
585
,
1
year
522 1
049
,
118 20 1
709
,
and
2
1
>
year

years
66 1
001
,
57 1 1
125
,
2
and
5
>
years

years
2
259
,
824
1
,
215 594
1
,
891
5
,
5
and
8
>
years

years
4
407
,
161 36 1
354
,
5
958
,
and
8
10
years
years
>
524 5 0 826 1
355
,
10
years
>
292 2 68 1
185
,
1
547
,

*Includes financial assets at fair value through other comprehensive income (10,779 million) and financial assets at amortised cost (6,263 million).

Diversified and collateralised portfolio

Loans

  • Loans to companies accounted for 43% of the loan portfolio as of September 2021, including 6% to construction and real-estate sectors
  • Mortgage accounted for 47% of the loan portfolio, with low delinquency levels and an average LTV of 60%
  • 86% of the loan portfolio is collateralised

Collaterals

  • Real estate accounts for 93% of total collateral value
  • 80% of the real estate collateral is residential

Consolidated net income

(Million euros) 9M20 9M21 YoY Impact on
earnings
Net interest income 1,153.7 1,168.6 +1.3% +15.0
Net fees and commissions 498.2 534.2 +7.2% +36.1
Other income* 10.9 3.6 -67.3% -7.3
Net operating revenue 1,662.7 1,706.4 +2.6% +43.7
Staff costs -469.9 -518.3 +10.3% -48.4
Other administrative costs and depreciation -342.8 -333.4 -2.7% +9.4
Operating costs -812.7 -851.7 +4.8% -39.0
Profit before impairment and provisions 850.0 854.7 +0.6% +4.7
Loans impairment (net of recoveries) -374.2 -264.0 -29.4% +110.2
Other impairment and provisions -176.4 -462.0 +161.9% -285.6
Impairment and provisions -550.6 -726.1 +31.9% -175.4
Net income before income tax 299.4 128.6 -57.0% -170.8
Income taxes -121.6 -143.1 +17.7% -21.5
Non-controlling interests -35.9 69.3 +105.2
Net income from discontinued or to be discontinued operations 4.5 4.7 +5.8% +0.3
Net income 146.3 59.5 -59.3% -86.8

*Includes dividends from equity instruments, other net operating income, net trading income and equity accounted earnings.

Consolidated balance sheet

(Million euros)

30 September 30 September
2020
2021 (restated)
ASSETS
Cash and deposits at Central Banks 5,557.4 3,843.8
Loans and advances to credit institutions repayable on demand 411.8 239.0
Financial assets at amortised cost
Loans and advances to credit institutions 664.2 845.1
Loans and advances to customers 54,900.9 51,592.6
Debt instruments 8,364.2 6,167.1
Financial assets at fair value through profit or loss
Financial assets held for trading 1,063.9 1,782.6
Financial assets not held for trading mandatorily at fair value through profit or loss 1,011.6 1,326.3
Financial assets designated at fair value through profit or loss - -
Financial assets at fair value through other comprehensive income 13,156.7 13,289.3
Hedging derivatives 86.6 138.8
Investments in associated companies 458.3 429.0
Non-current assets held for sale 850.8 1,181.4
Investment property 5.7 12.6
Other tangible assets 603.5 647.3
Goodwill and intangible assets 242.8 235.9
Current tax assets 13.7 11.5
Deferred tax assets 2,651.9 2,624.9
Other assets 1,419.0 1,612.7
TOTAL ASSETS 91,463.0 85,980.0
30 September
2021
30 September
2020
(restated)
LIABILITIES
Financial liabilities at amortised cost
Resources from credit institutions 9,072.0 9,071.7
Resources from customers 68,320.7 62,419.1
Non subordinated debt securities issued 1,745.6 1,420.0
Subordinated debt 1,205.4 1,419.5
Financial liabilities at fair value through profit or loss
Financial liabilities held for trading 368.4 350.6
Financial liabilities at fair value through profit or loss 1,508.7 1,883.0
Hedging derivatives 238.0 260.5
Provisions 473.8 319.4
Current tax liabilities 8.5 12.0
Deferred tax liabilities 9.4 9.5
Other liabilities 1,154.3 1,335.5
TOTAL LIABILITIES 84,104.8 78,500.6
EQUITY
Share capital 4,725.0 4,725.0
Share premium 16.5 16.5
Other equity instruments 400.0 400.0
Legal and statutory reserves 259.5 254.5
Treasury shares - (0.7)
Reserves and retained earnings 829.0 742.6
Net income for the period attributable to Bank's Shareholders 59.5 146.3
TOTAL EQUITY ATTRIBUTABLE TO BANK'S SHAREHOLDERS 6,289.4 6,284.1
Non-controlling interests 1,068.7 1,195.3
TOTAL EQUITY 7,358.1 7,479.3
TOTAL LIABILITIES AND EQUITY 91,463.0 85,980.0

Consolidated income statement per quarter

(Million euros)

Quarterly
3Q
20
4Q
20
1Q
21
2Q
21
3Q
21
Net
interest
income
390
7
383
4
375
8
392
4
400
4
Dividends
from
equity
instruments
1
3
0
0
0
0
0
7
0
2
Net
fees
and
commission
income
166
7
177
7
171
1
181
5
181
7
Other
operating
income
-24
1
-11
7
-23
3
-84
6
-2
5
Net
trading
income
63
5
46
1
41
5
38
2
-8
7
Equity
accounted
earnings
11
3
13
5
15
4
13
9
12
8
Banking
income
609
3
609
0
580
4
542
2
583
8
Staff
costs
152
2
9
157
142
2
232
1
144
1
Other
administrative
costs
78
3
89
6
76
8
72
4
81
4
Depreciation 33
7
33
6
34
0
34
3
34
5
Operating
costs
264
2
281
0
252
9
338
8
260
0
Profit
bef
impairment
and
provisions
345
1
328
0
327
5
203
3
323
8
of
Loans
impairment
(net
recoveries)
136
9
135
7
0
111
9
45
107
1
Other
. and
impairm
provisions
62
4
9
154
131
8
173
1
157
1
before
Net
income
income
tax
145
8
37
3
84
7
-15
7
59
6
Income
tax
63
4
13
8
57
3
45
6
40
2
Non-controlling
interests
13
1
-10
6
-28
8
-14
2
-26
3
income
(before
disc
. oper.)
Net
69
4
34
1
56
1
-47
1
45
7
Net
income
arising
from
discont
. operations
1
0
2
6
1
7
1
6
1
5
Net
income
70
3
36
7
57
8
-45
5
47
2

Income statement

(Million euros)

For the 9-month periods ended September 30th, 2020 and 2021

Internatio nal o peratio ns
Gro up P o rtugal T o tal B ank M illennium (P o land) M illennium bim (M o z.) Other int. o peratio ns
Sep 2 0 Sep 2 1 Δ % Sep 2 0 Sep 2 1 Δ % Sep 2 0 Sep 2 1 Δ % Sep 2 0 Sep 2 1 Δ % Sep 2 0 Sep 2 1 Δ % Sep 2 0 Sep 2 1 Δ %
Interest income 1.396 1.255 -10,1% 675 643 -4,8% 721 612 -15,0% 556 448 -19,4% 162 162 -0,3% 2 2 -1,8%
Interest expense 242 87 -64,2% 84 24 -72,0% 158 63 -60,1% 114 20 -82,5% 44 43 -2,7% 0 0 >100%
N et interest inco me 1.154 1.169 1,3% 591 619 4,8% 562 549 -2,4% 442 428 -3,2% 118 118 0,6% 2 2 -1,8%
Dividends from equity instruments 5 1 -81,7% 4 0 -97,1% 1 1 -5,4% 1 1 -5,4% 0 0 -- 0 0 --
Intermediatio n margin 1.158 1.169 1,0% 595 620 4,1% 563 550 -2,4% 443 429 -3,2% 118 118 0,6% 2 2 -1,8%
Net fees and commission income 498 534 7,2% 353 377 6,8% 146 158 8,2% 125 136 8,4% 21 22 6,8% 0 0 45,3%
Other operating income -143 -110 22,9% -72 -69 5,1% -71 -42 41,1% -79 -49 38,0% 8 8 -2,6% -1 -1 <-100%
B asic inco me 1.513 1.593 5,3% 875 928 6,0% 638 666 4,3% 489 516 5,4% 147 149 1,3% 2 1 -32,3%
Net trading income 95 71 -25,4% 47 64 37,1% 48 7 -85,8% 38 -5 <-100% 10 12 13,1% 0 0 90,7%
Equity accounted earnings 54 42 -22,3% 45 44 -1,6% 10 -2 <-100% 0 0 -- 0 0 -- 10 -2 <-100%
B anking inco me 1.663 1.706 2,6% 967 1.036 7,1% 696 671 -3,6% 528 511 -3,1% 157 160 2,1% 11 0 <-100%
Staff costs 470 518 10,3% 290 353 21,7% 180 166 -8,0% 150 135 -9,8% 30 30 0,9% 0 0 -7,9%
Other administrative costs 241 231 -4,1% 129 128 -0,3% 112 102 -8,5% 82 73 -11,3% 29 29 -0,7% 0 0 -23,7%
Depreciation 102 103 0,5% 57 60 5,5% 45 43 -5,7% 36 33 -7,5% 9 9 1,1% 0 0 -23,1%
Operating co sts 813 852 4,8% 476 541 13,8% 337 311 -7,9% 268 241 -10,0% 69 69 0,3% 1 1 -15,9%
P ro fit bef. impairment and pro visio ns 850 855 0,6% 491 495 0,7% 359 360 0,4% 260 270 3,9% 8 8 9 1 3,5% 11 - 1 <-100%
Loans impairment (net of recoveries) 374 264 -29,4% 260 204 -21,8% 114 60 -47,0% 103 54 -47,6% 10 6 -41,2% 0 0 100,0%
Other impairm. and provisions 176 462 >100% 72 103 42,8% 104 359 >100% 86 347 >100% 2 3 65,8% 17 10 -42,9%
N et inco me befo re inco me tax 299 129 -57,0% 158 188 18,4% 141 -59 <-100% 7 1 -131 <-100% 7 6 8 2 8,4% - 6 -11 -79,1%
Income tax 122 143 17,7% 66 72 8,4% 55 71 28,8% 41 50 23,0% 14 21 45,4% 0 0 -100,0%
Non-controlling interests 36 -69 <-100% 0 0 >100% 36 -70 <-100% 0 0 -- 1 0 -23,9% 35 -70 <-100%
N et inco me (befo re disc. o per.) 142 5 5 -61,4% 9 2 115 25,3% 5 0 -60 <-100% 3 0 -181 <-100% 6 1 6 1 0,0% -41 5 9 >100%
Net income arising from discont. operations 4 5 5,8% 0 0 -- 4 5 5,8%
N et inco me 146 5 9 -59,3% 9 2 115 25,3% 5 4 -56 <-100%

Glossary (1/2)

Assets placed with customers – amounts held by customers in the context of the placement of third-party products that contribute to the recognition of commissions.

Balance sheet customer funds – deposits and other resources from customers and debt securities placed with customers.

Business Volumes - corresponds to the sum of total customer funds and loans to customers (gross).

Commercial gap – loans to customers (gross) minus on-balance sheet customer funds.

Core income - net interest income plus net fees and commissions income.

Core net income - net interest income plus net fees and commissions income deducted from operating costs.

Cost of risk, net (expressed in basis points) - ratio of loans impairment (P&L) accounted in the period to loans to customers at amortized cost and debt instruments at amortized cost related to credit operations before impairment at the end of the period.

Cost to core income - operating costs divided by core income.

Cost to income – operating costs divided by net operating revenues.

Coverage of non-performing exposures by impairments – loans impairments (balance sheet) divided by the stock of NPE.

Coverage of non-performing loans by impairments – loans impairments (balance sheet) divided by the stock of NPL.

Coverage of overdue loans by impairments - loans impairments (balance sheet) divided by overdue loans.

Coverage of overdue loans by more than 90 days by impairments - loans impairments (balance sheet) divided by overdue loans by more than 90 days.

Debt instruments – non-subordinated debt instruments at amortized cost and financial liabilities measured at fair value through profit or loss (debt securities and certificates).

Debt securities placed with customers - debt securities issued by the Bank and placed with customers.

Deposits and other resources from customers – resources from customers at amortized cost and customer deposits at fair value through profit or loss.

Dividends from equity instruments - dividends received from investments classified as financial assets at fair value through other comprehensive income and from financial assets held for trading.

Equity accounted earnings - results appropriated by the Group related to the consolidation of entities where, despite having some influence, the Group does not control the financial and operational policies.

Insurance products – includes unit linked saving products and retirement saving plans ("PPR", "PPE" and "PPR/E").

Loans impairment (balance sheet) – balance sheet impairment related to loans to customers at amortized cost, balance sheet impairment associated with debt instruments at amortized cost related to credit operations and fair value adjustments related to loans to customers at fair value through profit or loss.

Loans impairment (P&L) – impairment (net of reversals and net of recoveries - principal and accrual) of financial assets at amortized cost for loans to customers and for debt instruments related to credit operations. Loans to customers (gross) – loans to customers at amortized cost before impairment, debt instruments at amortized cost associated to credit operations before impairment and loans to customers at fair value through profit or loss before fair value adjustments.

Loans to customers (net) - loans to customers at amortized cost net of impairment, debt instruments at amortized cost associated to credit operations net of impairment and balance sheet amount of loans to customers at fair value through profit or loss.

Loan to Deposits ratio (LTD) – loans to customers (net) divided by deposits and other resources from customers.

Loan to value ratio (LTV) – mortgage amount divided by the appraised value of property.

Net commissions - net fees and commissions income.

Net interest margin (NIM) - net interest income for the period as a percentage of average interest earning assets.

Net operating revenues - net interest income, dividends from equity instruments, net commissions, net trading income, other net operating income and equity accounted earnings.

Glossary (2/2)

Net trading income – results from financial operations at fair value through profit or loss, results from foreign exchange, results from hedge accounting operations, results from derecognition of financial assets and financial liabilities measured at amortized cost and results from derecognition of financial assets measured at fair value through other comprehensive income.

Non-performing exposures (NPE) – non-performing loans and advances to customers (loans to customers at amortized cost and loans to customers at fair value through profit or loss) more than 90 days past-due or unlikely to be paid without collateral realization, if they recognized as defaulted or impaired.

Non-performing loans (NPL) – overdue loans (loans to customers at amortized cost and loans to customers at fair value through profit or loss) more than 90 days past due including the non-overdue remaining principal of loans, i.e. portion in arrears, plus non-overdue remaining principal.

Off-balance sheet customer funds – assets under management, assets placed with customers and insurance products (savings and investment) subscribed by customers.

Operating costs - staff costs, other administrative costs and depreciation.

Other impairment and provisions – impairment (net of reversals) for loans and advances of credit institutions classified at amortized cost, impairment for financial assets (classified at fair value through other comprehensive income and at amortized cost not associated with credit operations), impairment for other assets, namely assets received as payment in kind, investments in associated companies and goodwill of subsidiaries and other provisions.

Other net income – dividends from equity instruments, net commissions, net trading income, other net operating income and equity accounted earnings.

Other net operating income – net gains from insurance activity, other operating income/(loss) and gains/(losses) arising from sales of subsidiaries and other assets.

Overdue loans – total outstanding amount of past due loans to customers (loans to customers at amortized cost, debt instruments at amortized cost associated to credit operations and loans to customers at fair value through profit or loss), including principal and interests.

Overdue loans by more than 90 days – total outstanding amount of past due loans to customers by more than 90 days (loans to customers at amortized cost, debt instruments at amortized cost associated to credit operations and loans to customers at fair value through profit or loss), including principal and interests.

Profit before impairment and provisions – net operating revenues deducted from operating costs.

Resources from credit institutions – resources and other financing from Central Banks and resources from other credit institutions.

Return on average assets (Instruction from the Bank of Portugal no. 16/2004) – net income (before tax) divided by the average total assets (weighted average of the average of monthly net assets in the period).

Return on average assets (ROA) – net income (before minority interests) divided by the average total assets (weighted average of the average of monthly net assets in the period).

Return on equity (Instruction from the Bank of Portugal no. 16/2004) – net income (before tax) divided by the average attributable equity + non-controlling interests (weighted average of the average of monthly equity in the period).

Return on equity (ROE) – net income (after minority interests) divided by the average attributable equity, deducted from preference shares and other capital instruments (weighted average of the average of monthly equity in the period).

Securities portfolio - debt instruments at amortized cost not associated with credit operations (net of impairment), financial assets at fair value through profit or loss (excluding the ones related to loans to customers and trading derivatives), financial assets at fair value through other comprehensive income and assets with repurchase agreement.

Spread - increase (in percentage points) to the index used by the Bank in loans granting or fund raising.

Total customer funds - balance sheet customer funds and off-balance sheet customer fund.

Total customer funds - balance sheet customer funds and off-balance sheet customer funds.

INVESTOR RELATIONS DIVISION Bernardo Collaço, Head

EQUITY Alexandre Moita +351 211 131 084 DEBT AND RATINGS Luís Morais +351 211 131 337

[email protected]

BANCO COMERCIAL PORTUGUÊS, S.A., a public company (Sociedade Aberta), having its registered office at Praça D. João I, 28, Oporto, registered at the Commercial Registry of Oporto, with the single commercial and tax identification number 501 525 882 and the share capital of EUR 4,725,000,000.00. LEI: JU1U6SODG9YLT7N8ZV32

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