Brasilprev - Banco do Brasil

Institutional Presentation
June 13
BB Seguridade
Largest Insurance, Pension and Premium Bonds Company in Latin America
Fast Growing with High Profitability
Largest Insurance Broker in Latin America
Largest Life Insurance Company in Brazil
2nd Largest P&C Insurance Company in Brazil
Leading Presence in Other Segments, such as Premium Bonds and Rural Insurance
Insurance Operations, Pension Plans and Premium Bonds Managed Through Private Partnerships with
Global Leaders
Successful Track Record
2013*
IPO BB Seguridade
Equity investment in IRB –
Brasil RE
2012
Brasildental
Partnership with
Creation of BB Odontoprev
Seguridade
2011
Established
Joint Venture
with Mapfre
2008-2011
Ownership
restructuring of
BB’s insurance,
Partnership
Pension Plans and
with Principal
Premium Bonds
Financial
division
Group in
Private
Pension Plans
1999
1996
1992
1981
1987
Creation of
BB’s
insurance
operations
BB Corretora’s
establishment
Creation of
Brasilprev
1995
Brasilcap’s
inception in
partnership
with
SulAmérica,
Icatu and
Aliança da
Bahia
Creation of
Brasilveículos in
partnership with
SulAmérica
* Pending approval by regulators, supervisors and inspectors.
Organizational Structure
Shareholders General Meeting
Fiscal Council
Board of Directors
Audit Commitee
Executive Officers
CEO
Marcelo Augusto Dutra Labuto
Finance and Investor
Relations Directorship
Commercialization
Directorship
Products & Communication
Directorship
Leonardo Giuberti Mattedi
André Luis Cortes Mussili
Ângela Beatriz de Assis
Shareholders Structure
Free-Float
33,75%
66,25%
100% Total
100% Total
BB Seguros
BB Corretora Holdings
BB Mapfre
SH1
Mapfre
BB SH2
Brasilprev
Brasilcap
IRB –
Brasil Re 1
Brasil
dental
BB Corretora
BB Seguridade Stake in
Terms of Total Shares (%)
74,9%
50,0%
74,9%
66,7%
20,5%
74,9%
100%
BB Seguridade Stake in
Terms of Voting Shares (%)
49,9%
49,0%
49,9%
49,9%
20,5%
49,9%
100%
50%
50%
50%
67%
20%
50%
100%
Board of Directors
Representation (%)
Pending approval by regulators, supervisors and inspectors.
1 Participation in the amount of shares in IRB – Brasil Re after the Extraordinary Shareholders Meeting, expected to ago/2013.
Corporate Governance Overview
Presidents, Vice Presidents and Directors
Board of Directors
16 members
SH1
Life
8 appointments
8 appointments
16 members
SH2
P&C
8 appointments
8 appointments
16 members
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Pension
Plans
Companhia de Seguros
Aliança do Brasil
Mapfre Vida S.A
Vida Seguradora S.A
6 appointments
6 appointments
6 appointments
6 appointments
6 appointments
6 appointments
Aliança do Brasil Seguros
S.A
BB Mapfre Assistência
Brasilveículos
Mapfre Affinity
Seguradora S.A
Mapfre Seguros Gerais
S.A
6 appointments
2 appointments
6 appointments
6 appointments
6 appointments
6 appointments
2 appointments
6 appointments
6 appointments
6 appointments
3 appointments
8 appointments
8 appointments
3 appointments
12 members
Brasilcap
Premium
Bonds
8 appointments
4 appointments
2 appointments
2 appointments
3 members
Broker
3 appointments
Source: BB Seguridade and Banco do Brasil
Broker: exclusive access to BB network
…supported by the largest banking network in Latin America with multiple relationship channels
Banking Channel1
Non-banking channel2
60.2 mm clients
Sound non-banking network spread all over Brazil
Partnerships
Branches
5,401
148
1º
Points of sale
Correspondents
ATM
60,049
18,218
4.290
Shared
External Brokers
28,210
20.198
1Source:
2Source:
Banco do Brasil – june 2013
Grupo BB Mapfre – june 2013
Broker: exclusive access to BB network
SH1
SH2
Brasilprev
Brasilcap
 Exclusive access to Banco do Brasil’s network
 Access to BB Corretora
 20-year term
 Obligation to sell their products through BB Corretora’s banking network
 No termination clause
 Remuneration: fixed percentage of policies, in operational contracts signed
product by product
 Signed in January 2013
 Relationship managed by shareholder agreements with 23-year term for
PFG, 20-year term for Mapfre and indefinite for Icatu / Aliança do Brasil
Related Parties’ Transaction Policy
 Enhanced transparency and certainty to minority shareholders
 BB Seguridade’s commitment to reaffirm its best corporate governance practices
 Creating a committee related parties, composed of at least one independent member, who must have a favorable vote for
approval and signature changes in contracts with related parties
Backed by BB and Private Partnerships
BB Mapfre SH1
SH1 Life
Life
 Life comprehends life insurance, personal accidents and credit-life insurance.
 Life insurance is a product focused on individual aiming at assuring financial protection to the beneficiaries chosen by the policy holder, in case of natural or
accidental death, or permanent disability of the individual.
 Credit life insurance (life insurance linked to loans) is intended to ensure the payment of a debt in the event of death, permanent disability or unemployment of the
borrower, preventing family member to inherit this liability. BB Seguridade products mainly cover the risks of death and disability.
Mortgage
 Housing insurance is related to the payment of housings. In case of death or disability of the insured, the insurance policy gives the guarantee that his family will
receive the property and the bank will receive the full payment of the property debt. A housing insurance can also protect against physical damage to the insured
property.
BB Mapfre SH1
SH1 Life
Rural Insurance
 Rural insurance protects farmers against adverse natural events, up to a maximum limit. It also covers cattle, farmer’s equity, farm assets, credit to commercialize
production, and the risk of death of producers.
Life (Insurance Premium) (R$ mm)
Premiums
BB Seguridade: +31.2%
Industry: +24.0%
Market Share
20.6%
Housing (Insurance Premium) (R$ mm)
Premiums
BB Seguridade: +107.4%
Industry: +23.9%
Market Share
6.6%
21.8%
1,427.5
4.0%
1,087.8
35.9
17.3
2Q12
2Q13
2Q12
2Q13
Rural (Insurance Premium) (R$ mm)
Premiums
BB Seguridade: +60.9%
Industry: +58.3%
Market Share
77.8%
79.1%
476.3
296.1
2Q12
2Q13
Source: SUSEP Data: Jun/13
Mapfre BB SH2
SH2 P&C
Property
 Property insurance consists in products developed to protect assets or property from individuals or companies, linked or not to loans. The main products of this
segment are housing insurance (covers the risk related to the property, and not to the individual, as it is the case for mortgage life or housing life insurance),
businesses insurance (protection for companies assets) and insurance for machines and equipment (protection of goods belonging to individuals and businesses).
Auto
 Auto insurance is a product aimed at protecting vehicles, for commercial or private use, from damage sustained and caused in accidents or other situations, besides
other assistances provided to the policy holder for their daily lives.
Auto
Premiums
Market Share
14.8%
887.7
2Q12
(Insurance Premium) (R$ mm)
∆%
BB Seguridade: +24.2
Industry: +21.4
15.2%
1,102.5
2Q13
Source: SUSEP Data: Jun/13
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Pension Plans
 Complementary pension plans are an optional product giving individuals additional financial protection outside of public retirement plans.
 The two most important products in this segment are PGBL (Plano Gerador de Benefício Livre) and VGBL (Vida Gerador de Benefício Livre). They are pension plans in
which individuals contribute during their working lives in return for receiving a monthly income or a single payment usually upon retirement.
 PGBL products are recommended for people who declare income tax (IR) in complete form because the contributions are deductible in the calculation bases of income
tax.
 VGBL products are recommended for those who declares income tax in simplified format or is exempt, since the contributions are not deductible in calculating the tax
base. In this modality, in case of redemption or income received, the incidence of IR is only on the value of income.
Pension Plans
Collection
Market Share
25.9%
4,718.1
2Q12
(Collection) (R$ mm)
∆%
BB Seguridade: +36.1
Industry: +8.7
30.1%
5,949.3
2Q13
Source: SUSEP Data: Jun/13
Brasilcap
Premium Bonds
 Premium bonds is a typical product of the Brazilian market, which links into a single financial instrument components of accumulation (savings) and lottery.
 Customers can choose between bonds single payment or perform monthly payments. In both cases, during the period, savers participate in draws with cash prizes. Part
of the payments is directed to the company to pay, for example, the cost of the plan and the prizes with draws. The remaining amount compose a reservation that the
participant gets back to the end of the plan.
 There are similar products in Spain and United Kingdom.
Premium Bonds
Collection
Market Share
(Collection) (R$ mm)
∆%
BB Seguridade: +102.4
Industry: +37.5
34.9%
23.7%
1,958.4
967.6
2Q12
2Q13
Source: SUSEP Data: Jun/13
BB Corretora
Brokerage
 The brokerage businesses consist in intermediating the sale of insurance products between the insurance company and clients.
 Due to the intermediation services, the broker receives a commission, which is calculated as a % of the value of the premium.
 There are no direct underwriting risks involved.
Commercialization of BB Seguridade’s products in BB’s retail banking base
Commercialization process
Gross premium
SH1
SH2
Reimbursement
of costs /
expenses
BB’s client
Brokerage
BB Corretora
Brasilprev
Banking service fees
Brasilcap
Highlights
Insurance, Pension Plans and Premium Bonds
Distribution
Holding
Business Lines
SH1
Life1
Ranking 10
1st
3
SH2
P&C2
nd
Pension Plans
1st
8
Premium Bonds
Brokerage
1st
1st
447
Net Revenues (2Q13)5
(R$ mm)
1,783
1,828
5,895
1,958
Adjusted ROAE
(2Q13)
27.7%
13.2%
59.0%
63.9%
Adjusted net income
(2Q13) 6 (R$ mm)
147.9
39.8
108.4
18.9
231.6
% of BB Seguridade
adjusted net income 9
26.9%
7.2%
19.7%
3.4%
42.1%
1st
39.1%
550.3 7
Source: Company fillings and Susep
1. SH1 comprises Life, Credit Insurance, Housing and Rural Insurance / 2. SH2 comprises Auto, Casualty and Others (except for Housing and Rural Insurance) / 3. 1ST position: Represents BB Seguridade’s Life products / 4.
2nd position: Represents BB Seguridade’s P&C products / 5. Premiums written for BB Mapfre SH1 and Mapfre BB SH2; Collections for Brasilcap; Contributions for Brasilprev; Operational revenues for BB Corretora / 6.
Considers the net income attributable to BB Seguridade / 7. BB Seguridade’s net income includes R$ 3.7mm related to holding revenues/expenses and taxes, which are not shown above / 8. 1ST position: Represents BB
Seguridade’s collections products / 9. Considers the results of holdings BB Seguridade, BB Seguros and BB Cor / 10. Position in 1H13
16
Earnings by Segment
Income from insurance, pension plans and premium bonds grows in all affiliates. Financial
result impacted by mark-to-market.
BB Mapfre SH1
Underwriting result
Underwriting result: +19.1%
Net investment income: -22.1%
Adjusted net income: +26.3%
Net investment income
Adjusted net income
Underwriting result
(R$ mm)
Underwriting result: +274.7%
Net investment income: -48.5%
Adjusted net income: +53.8%
Net investment income
Adjusted net income
197.2
156.2
79.6
51.8
241.5
202.7
73.2
57.0
2Q12
2Q13
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Result with pension plan
Net investment income
Adjusted net income
116.0
106.8
Mapfre BB SH2
(R$ mm)
102.5
54.7
27.4
28.1
2Q12
2Q13
Brasilcap
(R$ mm)
Result with pension plans: +56.7%
Net investment income: -19.3%
Adjusted net income: +24.7%
Result with premium bond
Net investment income
Adjusted net income
87.7
70.8
Result with premium bond: +145.0%
Net investment income: -109.0%
Adjusted net income: -21.9%
36.3
144.6
167.3
(R$ mm)
21.6
28.3
40.7
52.9
-3.7
2Q12
2Q13
2Q12
2Q13
Consolidated Earnings
Adjusted net income 31% higher even in an adverse environment for financial income
BB Seguridade Adjusted
Adjusted net income
ROAE (%)
(R$ mm)
Net income
Adjusted net income: +31.4%
34.3
BB Seguridade
(R$ mm)
ROAE (%)
Net income: +84.9%
39.1
39.1
550.3
23.6
418.9
550.3
297.6
2Q12
2Q13
2Q12
2Q13
BB Mapfre SH1 – Highlights
Adjusted ROAE grew fueled by growth in earned premiums.
Earned premiums
28.8%
Claims
(R$ mm)
(%)
+2.0 p.p.
1,173.4
32.0
34.0
2Q13
2Q12
2Q13
910.8
2Q12
Combined ratio
Adjusted ROAE
(%)
+1.7 p.p.
77.7
+7.2 p.p.
79.4
(%)
27.7
20.5
2Q12
2Q13
2Q12
2Q13
BB Mapfre SH1 – Highlights
Banking channel sustains the growth of premiums written. Highlight for credit insurance
and rural in premium’s composition.
Premiums written
(R$ mm)
Breakdown of premiums 2Q12 vs 2Q13
2Q12
+44.7%
1,783.2
1,232.4
2Q13
Mortagage life
Others
insurance
1.4%
Rural
3.3%
20.8%
Mortgage life insurance Others
2.0%
2.8%
Rural
44.7% Life
23.8%
2Q13
Selling channels 2Q12
Life
x
29.8%
2Q12
37.3%
34.2%
Credit insurance
Credit insurance
Selling channels 2Q13
Other channel
Other channel
11.4%
15.3%
84.7%
Bancassurance channel
88.6%
Bancassurance channel
Mapfre BB SH2 – Highlights
ROAE showed an increase impacted by the growth in earned premiums and improved
combined ratio.
Premiums earned
+19.1%
Combined ratio
(%)
-3.4 p.p.
1,806.3
59.0
55.6
2Q13
2Q12
2Q13
1,516.6
2Q12
Claims
(R$ mm)
Adjusted ROAE
(%)
(%)
-3.9 p.p.
98.2
+4.5 p.p.
94.3
13.2
8.7
2Q12
2Q13
2Q12
2Q13
21
Mapfre BB SH2 – Highlights
Performance in P&C maintains the growth of premiums written.
Premiums written
+17.7%
(R$ mm)
Breakdown of premiums 2Q12 vs 2Q13
2Q12
1,828.1
1,553.0
2Q13
Others
Others
Affinity
Affinity
14.4%
1.2%
57.2%
27.3%
58.9%
Auto
Selling channels 2Q13
Bancassurance channel
Bancassurance channel
34.6%
Other channel
27.5%
2Q13
Selling channels 2Q12
65.4%
x
12.5%
Casualties
Casualties
2Q12
1.1%
Auto
34.9%
65.1%
Other channel
Brasilprev – Highlights
Brasilprev reaches 53% of net total net inflow in the market, which has been supporting
the growth of reserves1.
Gross revenue from pension plans
Adjusted ROAE (%)
(R$ mm)
+0.2 p.p.
+26.7%
5,895.0
58.8
59.0
2Q12
2Q13
4,652.0
2Q12
2Q13
Net Inflow of Contributions
(R$ mm)
Technical Reserves
+29.1%
Net Inflow of Contributions
Market Share
53.0%
37.9%
3,526.2
3,566.1
2Q12
2Q13
(R$ bn)
75.2
58.3
jun-12
jun-13
1
Source: Consultoria Quantum Axis
Brasilcap – Highlights
Strong revenue growth, with an increase of reserves. A smaller net investment income and
retained earnings limited the expansion of ROAE.
Premium Bonds Collection
+106.8%
Adjusted ROAE (%)
(R$ mm)
1,958.4
110.9
63.9
946.8
2Q12
-47.0 p.p.
2Q13
2Q12
Technical Reserves
+42.8%
(R$ bn)
7.9
5.5
jun-12
jun-13
2Q13
BB Corretora – Highlights
Benefits from the predominance of sales through the banking channel, increase of
commission income and net margin.
Brokerage Revenues
+28.8%
(R$ mm)
Revenues Breakdown 2Q12 vs 2T13
2Q12
446.8
347.0
2Q13
Other
5.3%
12.5%
2Q13
Adjusted Net Income
(R$ mm)
+41.8%
2Q12
2Q13
46.8% SH1
16.1%
16.8%
SH2
SH2
Performance
(R$ mm)
2Q12
2Q13
Brokerage Revenues
Operating Result
Adjusted Net Income
347.0
239.7
163.3
446.8
337.9
231.6
Net Margin
47.1%
51.8%
231.6
163.3
x
Brasilprev
19.1%
2Q12
0.2%
20.1%
SH1
45.6%
Brasilprev 17.5%
Other
Brasilcap
Brasilcap
Contacts:
Investor Relations
SBS – Quadra 1 – Bloco A –
Ed. Sede I – 4º andar
70.073-900 – Brasília, DF
Tel: +55 (61) 3102-5771
www.bancodobrasilseguridade.com.br
ri@bbseg.com.br
Apresentação Institucional
Março 2013