ADDIKO BANK AG 1Q24 Results Presentation
Herbert Juranek (CEO)
Edgar Flaggl (CFO)
Tadej Krašovec (CRO)
Ganesh Krishnamoorthi (CMO & CIO)
Constantin Gussich (Investor Relations)
8 May 2024
Executive Summary & Business Update
Financials & Risk Update
Outlook & Wrap-Up
Additional Materials
Key Highlights 1Q24
Earnings
&
Asset Quality
Business
Development
Funding,
Liquidity
& Capital
AGM 2024
&
Dividend
- 1Q24 net profit up 61% YoY to €15.6m (1Q23: €9.7m) and up 42% vPQ
- Return on average Tangible Equity increased to 8.0% (1Q23: 5.4%)
- Operating result up 41% YoY to €28.5m reflects continued momentum on earnings despite higher deposit funding costs and inflation impact on operating expenses
- NPE volume at €146m (YE23: €138m) with NPE ratio (on-balance loans) at 2.9% (YE23: 2.8%),
while NPE coverage further increased to 81.4% (YE23: 80.9%) - Cost of Risk on net loans remained benign at -20bps(€-6.9m)
- Double-digitYoY growth in Consumer and SME continued - on track to achieve guidance
- NII up 14.5% YoY despite usual seasonality effects in first quarter and higher funding costs
- NCI improving 8.4% YoY on the back of accounts & packages, bancassurance and card business
- Expansion to Romania progressing according to plan
- Funding situation remained solid: Slight deposit growth to €5.1b, LDR at 69% and LCR >400%
- TCR ratio stable at a strong 20.3% fully-loaded - all in CET1 (YE23: 20.4%)
- AGM 2024 held on 26 April 2024 with all agenda items approved (c. 53% shareholders present)
- Dividend of €1.26 per share paid to shareholders on 7 May 2024
ADDIKO BANK AG | 8 MAY 2024 | 3 |
Strong Growth Momentum in Focus Continued
Focus portfolio development
Gross performing loans (€m)
Total Book | 3,304 | 3,361 | 3,486 | 3,520 | |||
+2% | |||||||
3,017 | 3,074 | ||||||
SME | 2,805 | ||||||
2,722 | 240 | 253 | |||||
Medium | 299 | 297 | |||||
SME | 1,070 | 1,069 | |||||
Micro & | 889 | 946 | |||||
Small SME
Consumer | 1,535 | 1,562 | 1,706 | 1,752 |
2022 | 1Q23 | 2023 | 1Q24 | |
New | ||||
Business | 1,322 | 346 | 1,522 | 379 |
(YTD) |
+10% YoY
- Total book (gross performing loans) up 1% since YE23 (up 5% YoY)
- +10% YoY growth in focus book (+12% YoY excluding medium SME)
- New business generation up +10% YoY
- Focus yield up to 6.6% with new business yields reaching 8.0% in Consumer and 6.0% in SME
- Focus book at 87% of gross performing loans
- Consumer book grew by 12% YoY
- SME book up 6% YoY while large ticket medium SMEs decreased by 15%
- Micro & Small SME book up 13% YoY
- Underwriting criteria continue to be calibrated to current environment in line with risk appetite
- Prudent risk approach remains strategic anchor - balancing of demand vs. risk appetite as priority over volume growth
ADDIKO BANK AG | 8 MAY 2024 | 4 |
Visible Progress in Business with Consumer & SME Customers in CSEE
Business Update
Improving dynamics YoY
• Strong customer growth in cash loans (+27% YoY)
• Solid new business delivered (+37% YoY) with
Consumer | premium pricing (+49bp YoY) | |
• | Card acceleration drives 35% YoY NCI growth | |
• Launching partnership business in Bosnia | ||
• Launched E2E digital lending enhancements |
€m
New business
(gross disbursements)
346
27
171
148
379
26
151
203
YoY
- +10%
- -6%
- -12%
- +37%
• New business slow down due to weaker demand | ||
followed by price drops by competition | ||
SME | • | Still keeping the price at premium (+65bp YoY) |
• NCI driven USPs: Launched auto-overdraft, credit | ||
card relaunch & bancassurance new products | ||
• Advancing Addiko's brand perception | ||
• Focus on maintaining premium price positioning | ||
• E2E digital in all countries without branch support | ||
2024 | • | Grow BNPL & partnership business |
Priorities | • | Expand revenue pools through new products & |
Consumer
New business yield
SME
New business yield
Focus yield1
Share of Partnerships in consumer gross disbursements
1Q23
7.5%
5.4%
6.0%
7%
1Q24
8.0% | +49bp |
6.0% | +65bp |
6.6% | +60bp |
+100%
12%
customer engagement & launching Romania | |
• | Best-in-class risk tools & streamlined process |
• | Focus on AI to enhance business |
1 Focus yield equals the gross yield of focus segments and is calculated as regular interest income (i.e. excluding interest income on NPE, interest like income and before FTP) divided by the simple average of gross performing loans based on beginning and end of period amounts.
ADDIKO BANK AG
1Q23 | 1Q24 | |||||
Partnerships/ | 382/ | 575/ | ||||
Locations | 948 | 1,076 | ||||
Consumer | Micro & Small SME | Medium SME | ||||
8 MAY 2024 | 5
Addiko Story Well Positioned for Strong Growth in Mid-Term
Vision
- We will turn Addiko into leading CSEE specialist bank for Consumer & SME customers
- We are focused and offer the best digital products to challenge universal banks
- We will accelerate the bank's transformation and generate value for our shareholders
- We offer better personal customer service than pure online banks
Consumer (Mid-Term)
Focus on less capital-intensive new products (packages, cards) driving fees
Embedded finance - Expansion to new industries with >30% of new business with higher interest rates & cross selling
E2E digital lending replacing
10-20% branch business adding convenience to digital customer
Better engaging mobile banking / cash-in & payment solutions driving better share of wallet
Products | |||
New | New | ||
Products | Products | ||
Distribution | |||
POS / | Smart | ||
Partnership | Targeting | ||
Digital | |||
E2E Digital | E2E Digital | ||
Lending | Lending | ||
Platform | |||
M-Banking | M-Banking | ||
App | App | ||
Operational Excellence
Best-in-class Risk Management
SME (Mid-Term)
Building SME ecosystems of new products
Enhanced SME targeting through focus on data, efficiency and leveraging the unique selling proposition of fast loans
Fastest lending solutions also available online to increase online channel distribution to 70%
Better mobile banking application offering engaging propositions tailored to diverse SME products
ADDIKO BANK AG | 8 MAY 2024 | 6 |
Executive Summary & Business Update
Financials & Risk Update
Outlook & Wrap-Up
Additional Materials
Financial Performance 1Q24 at a Glance
Financial Performance 1Q24
YTD, €m
1Q23 | YoY | ||
Net interest income | 59.8 | 52.2 | +14.5% |
Net fee & commission | 16.9 | 15.6 | +8.4% |
income | |||
Net banking income | 76.6 | 67.8 | +13.1% |
Net result on | 0.3 | 0.2 | 75% |
financial instruments | |||
Other operating result | -1.9 | -4.0 | -51.8% |
General administrative | -46.5 | -43.7 | +6.4% |
expenses | |||
Operating result1 | 28.5 | 20.3 | +40.6% |
Other result | -2.6 | -4.7 | -44.3% |
Expected credit | -6.9 | -4.5 | +55.1% |
loss expenses | |||
Tax on income | -3.4 | -1.5 | >100% |
Result after tax | 15.6 | 9.7 | +60.9% |
1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | ||
72.9 | 77.0 | 77.4 | 76.6 | |||
67.8 | ||||||
17.7 | 16.9 | -0.1% | 16.9 | |||
17.0 | ||||||
NCI | 15.6 | |||||
3.90% | 3.89% | 3.89% | ||||
3.80% | ||||||
3.55% | ||||||
NIM | ||||||
NII | 60.6 | -1.3% | ||||
55.9 | 59.3 | 59.8 | ||||
52.2 | ||||||
Avg. | ||||||
Loan | 1Q23 | 2Q23 | 3Q23 | 4Q23 | 1Q24 | |
Book2 | 3,299 | 3,338 | 3,373 | 3,402 | 3,464 | |
CIR | 64.5% | |||||
59.2% | 58.5% | 60.3% | 60.7% | |||
CoR | -0.13% | -0.14% | -0.01% | -0.07% | -0.20% | |
on net loans | ||||||
5.80%
5.30%
4.80%
4.30%
3.80%
3.30%
2.80%
2.30%
1.80%
- Continued positive trajectory on focus business NII and stable NIM, partially influenced by maturing non-focusloans and higher deposit cost
- 1Q24 NCI improving on the back of higher income from accounts & packages, bancassurance and credit card business
- General administrative expenses (OPEX) remained in check despite high inflation
- QTD CIR at 60.7% (down 3.8pp YoY)
1 Operating result before impairments and provisions. 2 Based on daily average.
ADDIKO BANK AG | 8 MAY 2024 | 8 |
Capital Position Remains Strong
Capital development fully-loaded
% CET1/TCR, YTD, RWA in €m
Addiko Group | 3,653 | 3,694 |
RWAFL
0.10%0.05%0.23%
CET1/
TCR
fully-loaded
20.4%
20.3%
2023 | OCI | Reg. & Equity | RWA | 1Q24 | |
changes | adjustments | Developm. | |||
Addiko Bank AG (Holding) | (incl. DTA) | ||||
CET1/TCR | 52.9% | 49.0% | |||
RWA | 936 | 1,004 |
- Solid CET1 capital as basis for business growth, supported by continued positive development in OCI during 1Q24 mainly reflecting the recovery of market values and the related fair value measurement of debt instruments measured at FVTOCI resulting in a decrease of current negative fair value reserves from €-48.6mat YE23 to €-45.7mat 1Q24
- Overall RWA growth was contained at 1% since YE23 and mainly driven by growth in Consumer and Treasury activities, supported by run-down in non-focus
ADDIKO BANK AG | 8 MAY 2024 | 9 |
Balanced NPE Development Continues in 1Q24
NPE volume & ratio development
€m, YTD
NPE ratio | 2.9% | 2.4% | 2.0% | 2.1% |
NPE ratio | 4.0% | 3.3% | 2.8% | 2.9% |
(on-balance loans)1 |
+6%
194 163 138 146
2021 2022 2023 1Q24
- Increase in NPEs in 1Q24 driven by a corporate client as well as postponed debt sale
- 1Q24 NPE ratio at 2.9% (on-balance loans)
Quarterly NPE formation & exit
€m, QTD
2Q23 | 3Q23 | 4Q23 | 1Q24 | |
Formation | 21.0 | 19.8 | 24.9 | 24.5 |
4.3 | 0.7 | |||
1.5 | ||||
1.1 | 10.3 | |||
8.0 | 9.4 | |||
8.6 | ||||
11.5 | 10.1 | 11.2 | 13.4 | |
Net change | -2.8 | -5.0 | -15.5 | +8.3 |
-13.1 | -12.9 | -14.0 | -9.1 | |
-5.0 | ||||
-8.6 | -8.3 | -2.1 | ||
-2.1 | -3.6 | -22.3 | ||
-4.1 | ||||
Exit | -23.9 | -24.8 | -40.4 | -16.2 |
Consumer SME Non-focus
1 Incl. exposure towards National Banks (respective values excl. NB exposure: 2021: 5.2%, 2022: 4.4%, 2023: 3.6%, 1Q24: 3.6%).
ADDIKO BANK AG | 8 MAY 2024 | 10 |
Attachments
- Original Link
- Original Document
- Permalink
Disclaimer
Addiko Bank AG published this content on 08 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 08 May 2024 05:42:03 UTC.
