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Commerzbank AG — Investor Presentation 2016
Mar 17, 2016
81_ip_2016-03-17_dc7c336c-ea53-48a6-8e17-6be485de5f3e.pdf
Investor Presentation
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Commerzbank 2015: More than 1 billion net profit − successful execution of strategy
Morgan Stanley – European Financials Conference 2016, London
Stephan Engels | CFO | London | 17 March 2016
More than 1 billion net profit − successful execution of strategy
Significantly increased earnings – strategy pays off
- › Sound operating result of €1.9bn and net income of €1.1bn
- › Operating RoTE of 7.3% and net RoTE of 4.2%
- › Earnings per share of €0.88
Strengthened capital ratio – proposal for dividend
- › With RWA <€200bn CET1 ratio fully phased-in of 12.0%
- › Leverage Ratio of 4.5%
- › Proposal for dividend of 20ct per share
Group with sound risk profile – NCA targets achieved
- › Group with low LLPs of €0.7bn and cost of risk at low 16bps
- › Group NPL ratio at record low of 1.6%
- › CRE & Ship Finance exposure already below €20bn
Sound operating result of €1.9bn
Commerzbank well capitalised
B3 fully phased-in capital ratios
Strong market position in all Core Bank divisions
Operating result (€m)
Private Customers: Strategy pays off
Best advisory with >60% highly satisfied customers and ~820,000 net new customers since 2013
10% market share in new mortgage business and revenue increase of ~€50m from growing consumer loan business
Growing recurring revenue stream from volume based fee model accounts for more than 65% of total revenues from securities
Mittelstandsbank: No. 1 in Germany
Strong relationship model with customer satisfaction of >96%
Total lending growth of +12% since end-2013 and +4% y-o-y despite reluctance of corporate customers to invest
Top partner in foreign trade of the eurozone with market share of 19% in export letters of credit and 8% in export payments
Central & Eastern Europe: mBank most innovative bank in Poland
400,000 net new customers to almost 5 million overall in 2015
Lending volume +7% thanks to mortgages in local currency, consumer credit and corporate loans
36% growth in cashless card transactions towards 12% market share
Stephan Engels | CFO | London | 17 March 2016 7
Corporates & Markets: Client-centric investment banking
Securing access for Mittelstand clients to tailored corporate finance and capital market solutions
No.1 in Europe as market maker for ETFs with a 14% market share
No.2 globally as lead manager for covered bonds in euros
Significant investments into our digitisation strategy
From a branch bank to a mulit-channel bank – e.g. online-/videochat, pure online account opening, cash management app
Active promotion of fintech via our flexible, innovative units main incubator, CommerzVentures and Start-up Garage of comdirect
Digital transformation of internal processes to improve efficiency and the customer interface
Sound risk profile
Oil/gas exposure stands for <1% of total exposure – >75% investment grade
- › Roughly 60% of the exposure to integrated oil & gas majors and Tier II operators
- › Commodity trader exposure concentrated to world's top independent energy traders
- › >75% of the overall portfolio rated investment grade
- › High reactability more than 50% of the exposure with maturities below 1 year
- › No exposure to single asset operations
- › No shale producers
- › No project finance
Stephan Engels | CFO | London | 17 March 2016 11 1) Largely state owned and / or national companies with diversified operations with integrated upstream and downstream
Transfer of high quality assets to Core Bank
New ACR is ring-fenced with sufficient equity capital even under stress – we aim for significant capital relief over time
Sound risk profile and significantly improved returns on a substantially increased capital base
Substantial achievements despite significant headwinds from the low and negative interest rate environment and regulatory requirements
CET1 ratio fully phased-in of 12.0%
Proposal for dividend of 20ct per share
NCA reduced ahead of repeatedly stretched targets
Net RoE Core Bank of 8.1% despite capital buildup of ~€7bn / 50% since 2012
CIR Core Bank of 60% not within reach in the current low interest rate environment
| FY 2014 | FY 2015 | Targets 2016 |
||
|---|---|---|---|---|
| Basel 3 CET1 (fully phased-in) |
9.3% | 12.0%1) | > 10% | |
| Leverage Ratio (fully phased-in) |
3.6%2) | 4.5%2) | ~ 4% | |
| Volume NCA (CRE & Ship Finance) |
€32bn | €19bn | ~ €20bn | |
| RoE, Core Bank (net after tax) |
6.2%3) | 8.1%3) | > 10% | |
| CIR, Core Bank | 77% | 72% | ~ 60% |
Includes net profit of FY 2015 excl. dividend accrual
1)
2)
Stephan Engels | CFO | London | 17 March 2016 14 Leverage Ratio-Exposure according to revised CRD4/CRR rules published 10 Oct 2014
3) Based on average tax rate 2013-2015 calculated by applying total group tax expenses to the Core Bank result
Rating upgrades in Q1 2016 reflect improved profile of CBK – Credit Issuer Ratings of all three agencies in the upper "BBB" range
| Commerzbank Ratings | since 11.03. |
∆ | since 25.01. |
∆ | since 07.03. |
∆ |
|---|---|---|---|---|---|---|
| Counterparty Risk Assessment |
- | - | A2 | +1 | - | - |
| Deposits | - | - | A2 stable | +2 | - | - |
| Issuer Credit Rating |
BBB+ stable | +/-0 | Baa1 stable | +/-0 | BBB+ stable | +1 |
| Stand-alone (Financial Strength) |
bbb+ | +1 | Baa3 | +1 | bbb+ | +1 |
| Subordinated debt (Tier 2) |
BBB- | +1 | Ba1 | +1 | BBB | +1 |
| Short-term debt | A-2 | +/-0 | P-1 | +1 | F2 | +/-0 |
| Upgrades were driven by enhanced capitalisation, profitability and improved risk profile |
Stand-alone rating came back to investment-grade level at Moody´s; all issuer credit ratings in the upper "BBB" range with stable outlooks |
Subordinated debt: Tier 2 Bonds fulfill in principle iBoxx Index investment-grade requirements1) |
Stephan Engels | CFO | London | 17 March 2016 15 1) Based upon conversations and documentation from Markit we expect Commerzbanks' EURO Benchmark Tier2 transactions to be included in the iBoxx Subordinated Index
Financial outlook 2016 in an overall challenging macro environment
We pursue our strategy and aim to further increase market share in our core bank divisions
We aim to keep our cost base stable with exception of additional external burdens
We expect a moderate increase in loan loss provisions due to lower releases from impaired loans
Overall we expect a slight increase in net profit
Disclaimer
Investor Relations
This presentation contains forward-looking statements. Forward-looking statements are statements that are not historical facts; they include, inter alia, statements about Commerzbank's beliefs and expectations and the assumptions underlying them. These statements are based on plans, estimates, projections and targets as they are currently available to the management of Commerzbank. Forward-looking statements therefore speak only as of the date they are made, and Commerzbank undertakes no obligation to update any of them in light of new information or future events. By their very nature, forward-looking statements involve risks and uncertainties. A number of important factors could therefore cause actual results to differ materially from those contained in any forward-looking statement. Such factors include, among others, the conditions in the financial markets in Germany, in Europe, in the United States and elsewhere from which Commerzbank derives a substantial portion of its revenues and in which it hold a substantial portion of its assets, the development of asset prices and market volatility, potential defaults of borrowers or trading counterparties, the implementation of its strategic initiatives and the reliability of its risk management policies.
In addition, this presentation contains financial and other information which has been derived from publicly available information disclosed by persons other than Commerzbank ("external data"). In particular, external data has been derived from industry and customer-related data and other calculations taken or derived from industry reports published by third parties, market research reports and commercial publications. Commercial publications generally state that the information they contain has originated from sources assumed to be reliable, but that the accuracy and completeness of such information is not guaranteed and that the calculations contained therein are based on a series of assumptions. The external data has not been independently verified by Commerzbank. Therefore, Commerzbank cannot assume any responsibility for the accuracy of the external data taken or derived from public sources.
Copies of this document are available upon request or can be downloaded from https://www.commerzbank.de/en/hauptnavigation/aktionaere/investor_relations.html
For more information, please contact Commerzbank's IR team
Tanja Birkholz (Head of Investor Relations / Executive Management Board Member) P: +49 69 136 23854 M: [email protected]
Christoph Wortig (Head of IR Communications)
P: +49 69 136 52668 M: [email protected]
Institutional Investors and Financial Analysts
Michael H. Klein P: +49 69 136 24522 M: [email protected]
Maximilian Bicker P: +49 69 136 28696 M: [email protected]
Retail Investors
Florian Neumann P: +49 69 136 41367 M: [email protected]
Simone Nuxoll P: +49 69 136 45660 M: [email protected]
Dirk Bartsch (Head of Strategic IR / Rating Agency Relations)
P: +49 69 136 22799
[email protected] www.ir.commerzbank.com