Obbligazioni Bancarie Garantite Programme

Transcription

Obbligazioni Bancarie Garantite Programme
Investor Presentation
July 2015
Disclaimer
| Strettamente riservato e confidenziale
This document has been prepared by “Banca popolare dell’Emilia Romagna” solely for information purposes, and only in order to present its
strategies and main financial figures.
The information contained in this document has not been audited.
No guarantee, express or implied, can be given as to the document’s contents, nor should the completeness, correctness or accuracy of the
information or opinions herein be relied upon.
Banca popolare dell’Emilia Romagna, its advisors and its representatives decline all liability (for negligence or any other cause) for any loss
occasioned by the use of this document or its contents.
All forecasts contained herein have been prepared on the basis of specific assumptions which could prove wrong, in which case the actual
data would differ from the figures given herein.
No part of this document may be regarded as forming the basis for any contract or agreement.
No part of the information contained herein may for any purpose be reproduced or published as a whole or in part, nor may such information
be disseminated.
Banca popolare dell’Emilia Romagna Società cooperativa con sede in Modena, via San Carlo, 8/20 - Codice Fiscale, Partita IVA e iscrizione nel Registro Imprese di Modena
n. 01153230360 - Capitale sociale variabile - Codice ABI 5387.6 Iscritta all’Albo delle Banche al n. 4932 e all’Albo delle Cooperative al n. A163859 - Telefono 059.2021111 Telefax 059.2022033 - email: bpergroup@bper.it - PEC: bper@pec.gruppobper.it Aderente al Fondo Interbancario di Tutela dei Depositi e al Fondo Nazionale di Garanzia Capogruppo del Gruppo bancario Banca popolare dell’Emilia Romagna iscritto all’Albo dei Gruppi Bancari al n. 5387.6 - bper@pec.gruppobper.it - bper.it - gruppobper.it
Page | 2
Agenda
Introduction to BPER Group
1Q15 Results
 Executive summary
 Profit and loss
 Balance sheet structure
 Assets
 Funding & Capital
 Annexes
OBG Programme & Cover pool description
Italian mortgage market
Becoming BPER: new Business Plan 2015-17 in a snapshot
Page | 3
National Presence and Strong Multi-Regional Footprint
#6 in Italy by Branches and Total Assets1
National presence
Group
Commercial banks
BPER
Banco di Sardegna
Banco di Sassari
CR Bra
Total
Geografic
areas in Italy
North
Centre
South
Islands
Total
# Branches
816
374
55
28
1,273
# Branches
432
192
229
420
1,273
Market Shares
3
Greater than 7.5%
46
34
Between 5% and 7.5%
Between 2.5% and 5%
28
316 (9.7%)
Lower than 2.5%
5
Number of
Italian Branches
Data as of 31.12.2014
Bank 1
Total
Assets (€/bn)
646
4,473
Bank 2
844
4,009
Bank 3
183
2,186
Bank 4
123
1,812
Bank 5
122
1,670
BPER
Bank 7
10
61
1,273
48
654
9
2
Focus on traditional business with customers1
98
73
10
104
Customer loans / Total assets (%)
Data as of 31.12.2014
37
35
400
43
20
Source: BPER Group data as of 31 Mar.’15
1) Includes: ISP, UCG, BMPS, BP, UBI and PMI
Source: Company information
Page | 4
BPER: overview of the common stock history and the shareholder structure
Common stock history and status
Shareholder Structure
•
Shares outstanding as of 31 Mar.’15: 481,308,435
•
BPER share milestones:
•
Geographical distribution:
•
22 Jun.’09: listing on MTA (“Mercato Telematico Azionario”)
•
North: 83.5% (of which Emilia Romagna 78.3%)
•
19 Sept.’11: inclusion in the FTSEMIB index (Italian “blue chips” index)
•
Centre, South & Island: 15.5%
•
Abroad: 0.2%
•
Last 3 months average daily volume: c. 4.0 million shares
•
Currently, the “cooperative” status of BPER, according to Italian law, implies
that every shareholder has one vote in relation to the resolutions of the
Shareholders' meeting regardless of the number of shares owned (“one head
one vote” rule). The recent approval of the law regarding the “Banche
popolari reform” implies the mandatory transformation of Popolari banks
(with total assets above 8 €/bn) into join-stock companies by the end of
2016.
Market Capitalisation1 (€/bn)
•
•
Registered shareholders ("Soci") as of 31 Mar.’15: 89,143
Institutional investors in BPER’s total capital (as of 31 Aug.’14): 32.3%
•
Geographical distribution (main countries):
•
USA 33%, UK 26%, France 11%, Norway 7%
Institutional Investors’ Growth
% BPER Shares Held by
Institutional Investors
1) Includes: ISP, UCG, BMPS, BP, UBI and PMI.
Source: Company information, Bloomberg of 17 July 2015, Shareholders ID (31/08/2014)
Page | 5
Agenda
1Q15 Results
 Profit and loss
 Assets
 Annexes
Page | 6
Executive summary
•
1Q15 Net profit of 51.7 €/mn (+65.6% y/y) the best result since 3Q12
•
Loan loss provisions accounted in 1Q15 (147.5 €/mn) significantly down (-30.4% y/y; -36.6% q/q), the lowest level in the last
10 quarters, confirming the beginning of a new phase of “cost of credit” normalization
•
Cash coverage ratio on total doubtful loans at 41.0% (+30 bps versus Dec 2014), the highest level since 2009
•
Solid capital base with a CET1 ratio “Fully Phased” of 11.3% as of 31 Mar.’15 (or 11.4% “Phased in”) excluding potential
benefits from internal models (“AIRB”) validation (process already started at the end of January 2015 with both ECB and Bank
of Italy)
•
B3 leverage ratio at 7.1% one of the best among domestic peers
•
Liquidity ratios LCR and NSFR well above 100%*
•
Operating income at 555.0 €/mn in the 1Q15 up by 2.7% q/q (-4.9% y/y):
•
•
Net interest income slightly up by 0.3% q/q (-4.8% y/y) thanks to a spread improvement with substantially flat loans volume and despite
the “calendar effect” (2 days less than the last quarter of 2014)
•
Net commissions up by 1.7% q/q (+4.5% y/y) resulting mainly from improving AuM & bancassurance fees (+21.2% q/q; 33.2% y/y) and
recording signals of stabilization of “traditional business” fees related to loans and guarantees in the quarter (-0.3% q/q)
•
Dividends and Trading income up by 19.5% q/q (-27.5% y/y) mainly thanks to favourable financial markets
Operating costs broadly in line compared to 1Q14 (+0.3%) and down by 7.7% q/q (4Q14 included some one-off items)
*: LCR index at 31 March 2015 stands at 117%, whereas the NSFR index is estimated well over 100% (at 31 December 2014 it was 115%)
Page | 7
Agenda
1Q15 Results
 Profit and loss
 Assets
 Annexes
Page | 8
Profit & Loss
1Q15 Reclassified consolidated Profit & Loss
(€/mn)
Captions
10+20
40+50
70
80+90+100+110
220*
180 a)
180 b)*
200+210
130 a)
130 b)+c)+d)
190
240+260+270
290
310
320
330
340
Mar 15
Mar 14
Chg y/y (%)
4Q14
3Q14
2Q14
1Q14
Net interest income
Net commissions
Dividends
Net trading income
Other revenues/costs
Operating income
Staff expenses
Administrative expenses
Depreciations & Amortizations
Operating costs
Net operating income
Loan loss provisions
Other provisions
Total provisions
Net Provisions for Risks & Charges
Net other income
Profit (loss) before taxes
Taxes
Net profit of assets under disp.
Net profit (loss)
Minority Interests
Profit (loss) for the period
pertaining to the Parent Company
314.1
179.2
0.2
46.1
15.4
555.0
-199.3
-93.6
-17.3
-310.3
244.8
-147.5
-2.5
-150.0
-14.1
-1.8
78.9
-27.2
0.0
51.7
-6.5
329.8
171.5
0.6
63.3
18.7
583.8
-196.8
-96.3
-16.4
-309.5
274.3
-211.8
-2.9
-214.7
-6.7
-1.0
52.0
-20.8
0.0
31.2
-2.9
-4.8%
4.5%
-56.6%
-27.2%
-17.3%
-4.9%
1.3%
-2.8%
5.9%
0.3%
-10.8%
-30.4%
-14.6%
-30.2%
111.7%
82.4%
51.9%
31.2%
n.m.
65.6%
120.7%
313.3
176.2
1.1
37.7
12.2
540.4
-208.8
-106.8
-20.4
-336.0
204.5
-232.6
-35.0
-267.6
-11.1
0.7
-73.6
27.6
0.0
-46.0
-0.3
320.0
169.0
0.1
20.3
5.9
515.3
-180.0
-97.9
-17.0
-295.0
220.4
-163.3
-3.8
-167.1
-8.0
2.3
47.5
-14.3
0.0
33.3
-8.1
328.6
174.0
17.6
46.4
11.1
577.8
-201.1
-103.3
-16.6
-321.0
256.8
-205.0
-3.8
-208.8
-13.0
-2.8
32.3
-20.9
0.0
11.3
-3.7
329.8
171.5
0.6
63.3
18.7
583.8
-196.8
-96.3
-16.4
-309.5
274.3
-211.8
-2.9
-214.7
-6.7
-1.0
52.0
-20.8
0.0
31.2
-2.9
45.2
28.3
59.9%
-46.3
25.2
7.6
28.3
cost / income
cost / (net interest income + net commissions)
cost of credit (bps)
cost of credit on annual basis (bps)
net profit / total income
tax rate
55.9%
62.9%
34
135
9.3%
34.5%
53.0%
61.7%
46
185*
5.3%
39.9%
62.2%
68.6%
53
57.2%
60.3%
37
55.6%
63.9%
45
53.0%
61.7%
46
-8.5%
37.4%
6.5%
30.0%
2.0%
64.9%
5.3%
39.9%
n.m.: Not meaningful; (*) Caption exposed net of “Recovery of taxes” reallocated, for better representation, at caption 180 a) “Other administrative costs”, where relative tax costs are accounted
(*) Estimated annualized cost of credit based on March ‘14 figures; 2014 final year cost of credit was 185 bps
Note: figures in this page may not add exactly due to rounding differences
Page | 9
Net Interest Income
Net Interest Income (€/mn)
-4.8%
+0.3%
Net Interest Income contribution (%; y/y)
Spread effect
Volume
effect
•
Net Interest Income down by 4.8% y/y mainly due to the different
economic and market environment and interest rates level
•
NII up by 0.3% q/q despite the “calendar effect” (2 days less than the
last quarter of 2014) mainly infuenced by:
•
Lower financial asset yield offset by an increase in volume
(contribution to NII stable vs the last quarter)
•
increasing pressure on loans competition: loans spread
reduction offset by a significanti reduction of cost of funding
•
benefits from repricing actions on cost of funding mainly on
sight deposits (effective by 1 Jan.’15)
•
partial substitution of retail funding with wholesales one
benefeting by positive market conditions
Net Interest Income contribution (%; q/q)
Spread effect
Volume
effect
Calendar
effect
Total
Total
Page | 10
Spread evolution
Spread (%)
3.29
3.26
3.15
3.05
2.07
3.00
2.50
2.17
2.16
2.09
1.12
1.11
1.06
Spread slightly up (2.10% in the 1Q15 from 2.07% in 4Q14)
•
Asset yield reduction driven by commercial and financial yield decline
more than offset by the decrease of cost of funding
•
Mark-down improving by 12 bps and mark-up slight decline by 5 bps
•
1Q15 average 3M Euribor down to 5 bps from 8 bps in 4Q14 and 29 bps
in 1Q14
Mark up & mark down (%)
Spread contribution (%)
3.50
•
2.93
2.10
2.00
1.50
1.00
0.50
0.30
0.30
0.17
0.98
0.83
0.08
0.05
4Q14
1Q15
0.00
1Q14
2Q14
Euribor 3M (avg)
3Q14
Tot. Assets yield
Tot. Liabilities yield
Spread
Figures from data management system and calculated on a Consolidated basis
Page | 11
Net Commissions
Net Commissions (€/mn)
•
+4.5%
Net commissions up 4.5% y/y and +1.7% q/q mailnly driven by good
performance in AuM and Bancassurance placement:
•
indirect deposits and bancassurance +33.2% y/y (+21.2% q/q)
•
credit cards, collections/payments down by 6.1% y/y
(-9.3% q/q)
•
loans and guarantee -4.3% y/y affected by weak credit
demand, but broadly stable vs 4Q14 (-0.3%) showing
encouraging signs of stabilization
Net Commissions evolution (€/mn)
Net Commissions breakdown (€/mn; %)
+1.7%
Mar 15
Mar 14
Chg y/y (%)
Indirect deposits and bancassurance
46.5
34.9
33.2%
Credit cards, collections and payments
35.7
38.0
-6.1%
Loans and guarantees
86.4
90.2
-4.3%
Other commissions
10.6
8.3
28.1%
179.2
171.5
4.5%
Total
Page | 12
Dividends and Trading income
•
Dividends and Trading income (€/mn)
-27.5%
Dividends and Trading income breakdown (€/mn; %)
Dividends
Trading (net)
Plus
Minus
FVO
Others
Total
Mar 15
0.2
30.7
30.9
-1.4
-6.5
-7.6
46.3
Dividends and trading income down at 46.3 €/mn vs 63.9 €/mn in
Mar.’14 but up by 19.5% q/q:
•
Trading income (realized gains) of 30.7 €/mn in 1Q15 only
partially due to the AFS financial assets disposal on
Government bonds
•
Fair Value Option on financial liabilities: -6.5 €/mn in Mar.’15.
FVO effects almost completely absorbed and no more impacts
expected from next quarter onwards
Trading gains excluding dividends (€/mn)
Mar 14 Chg y/y (% )
0.6
-56.6%
71.3
-57.0%
16.0
93.4%
-3.0
-53.3%
-12.7
-48.4%
-8.3
-8.5%
63.9
+22.3%
-27.5%
1
Note 1: Trading income includes an accounting reallocation (-29.0 €/mn) occurred in the 3Q14 from LLPs to “Losses on disposal of loans” within trading (from item 130-a to item 100-a in the
P&L), already accounted in 2Q14, related to the sale of a “non-core” portfolio of residential mortgage NPLs
Page | 13
Operating costs
Operating Costs (€/mn)
+0.3%
•
Operating costs broadly stable (+0.3% y/y) but down by 7.7% q/q
(4Q14 included some one-off items):
•
Staff costs +1.3% y/y (-4.5% q/q; 4Q14 included a redunduncy plan
one-off cost of c. 9 €/mn). Previous National Labour contract inertial
increase offsets savings from headcont reduction
•
Administrative expenses down by 2.8% y/y mainly affected by
seasonality; -12.3% q/q influenced by extra one off costs recorded in
4Q14 mainly related to AQR activities, infra-group mergers, rights
issue
•
D&A up 5.9% y/y mainly due to investments expenses in 2014 in
execution of the old Business plan
Operating costs evolution (€/mn)
Operating costs breakdown (€/mn; %)
-7.7%
Mar 15 Mar 14 Chg y/y (% )
Staff expenses
199.3
196.8
1.3%
Administrative expenses
93.6
96.3
-2.8%
D&A
17.4
16.4
5.9%
310.3
309.5
0.3%
Operating costs
Page | 14
Provisions
Provisions breakdown (€/mn)
Total figures
214.7
-30.2%
150.0
•
Total provisions significantly down by 30.2% y/y (-64.7 €/mn y/y) and
down by 44,0% q/q (-117.7 €/mn)
•
Loan Loss Provisions down by 30.4% y/y, the lowest level in the
last 10 quarters (3Q12:128.6 €/mn)
•
Other provisions (-14.6% y/y) including an impairment of a
financial assets available for sale for a total value of 6.0 €/mn
relating to a single shareholding
• Cost of credit at 34 bps in 1Q15 (135 bps annualized) remarkably down with
the previous quarters
Loan Loss Provisions evolution (€/mn)
Cost of credit evolution (bps)
-36.6%
Page | 15
Agenda
1Q15 Results
 Profit and loss
 Assets
 Annexes
Page | 16
Customer loans
Customer loans (€/mn)
•
Net customer loans down by 4.3% y/y still below the one-year ago level as
a consequence of the prolonged economic recession in Italy, still weak
demand for investments, credit sector de-risking strategy (ie. real estate
and construction) and a gradual refocus on higher rating customer
exposures
•
1Q15 net loans volume trend substantially flat (-0.1%)
•
Gross loans value shows a positive performance (+0.1%) after 8
consecutive decling quarters showing that a turning point in volumes
should have been reached
•
Retail mortgages new business up by 43.5% y/y confirming an uptrend
which started at the beginning of the last year
•
Corporate and retail loans account for 94.3% of the total loan book,
confirming BPER Group’s focus on commercial business
-4.3%
-0.1%
Customer loans breakdown (net figures; €/mn )
€/mn
Current accounts
Mar 15
Dec 14
Mar 14
Chg vs Dec '14
(%)
Customer loans breakdown by customer segment (%)
Chg y/y
(%)
6,456
6,514
7,559
-0.9%
-14.6%
Medium-Long term loans
24,950
24,896
25,434
0.2%
-1.9%
Other transactions
12,459
12,510
12,855
-0.4%
-3.1%
Customer loans
43,865
43,920
45,849
-0.1%
-4.3%
Large
corporate
4.7%
Others
1.0%
Retail &
Private
41.1%
Corporate
53.2%
Page | 17
Customer loans: portfolio composition
Customer loans breakdown by sectors (%)
Business sector
Customer loans breakdown by geographical distribution* (%)
Mar 15 % on Total ∆ % vs Dec 14
Agriculture, forestry and fishing
1,230
2.8%
-0.7%
Manufacturing
7,021
16.0%
1.2%
Constructions
4,814
11.0%
-1.1%
Wholesale and retail services, recoveries and repairs
4,985
11.4%
1.7%
HORECA*
1,676
3.8%
2.0%
Real Estate
3,259
7.4%
-4.3%
Other
5,206
11.9%
0.8%
Total loans to resident non-financial businesses 28,191
64.3%
0.1%
134
0.3%
4.4%
Total loans to non-financial businesses
28,325
64.6%
0.1%
Households
10,396
23.7%
-1.3%
5,144
11.7%
0.8%
43,865
100.0%
-0.1%
Non-resident, non-financial companies
North: 52.0%
Emilia Romagna: 35.2%
South: 12.1%
Centre: 19.1%
Islands: 16.3%
Total loans to financial businesses
Total Customers Loans
Figures as per ATECO business sector definitions (ISTAT)
*: Hotel, Restaurant & Cafè (HORECA)
Sardinia: 14.9%
*Commercial banks + Sarda Leasing
•
Well diversified loan portfolio
•
Construction sector further downsizing (-1.1 since Dec 14; -12.1% y/y) following a de-risking strategy
Page | 18
Doubtful loans (1/2)
Doubtful loans breakdown (net figures; €/mn)
Total figures
6,470
6,564
256
334
3,583
3,630
6,590
6,618
6,527
296
192
218
Net doubtful loans only slightly up by 1.0% (63 €/mn) and +1.8% y/y. (119
€/mn) showing signs of stabilization
•
New EBA standards and definitions about non-performing exposures (i.e.
different accountability of watchlist and restructured loans according to the
introduction of the “unlikely to pay” cathegory*)
•
In details (net figures):
+13.2%
3,504
3,516
3,614
+1.0%
•
-0.3%
•
Non performing loans (Sofferenze) up (+11.0% y/y; +1.7% since
Dec.’14)
•
Unlikely to pay down (-3.5% y/y; -0.3% since Dec.’14)
•
Past-due down by 15.1% y/y; +13.2% since Dec.’14
2,584
2,647
2,708
2,819
2,868
+1.7%
•
Coverage on doubtful loans at 41.0% (40.7% in Dec.’14), the highest level
since 2009. Unlikely to pay coverage up by 92 bps since Dec.’14
Mar 14
Jun 14
Sept 14
Dec 14
Mar 15
Change
vs Dec.’14
•
85.7% of total net doubtful loans are collateralized (76.1% fully
collateralized)
Non performing
Unlikely to pay
Past due
Doubtful loans breakdown (% on total net loans)
Cash coverage trend (%)
Total figures
14.1%
14.5%
0.6%
0.7%
14.8%
0.7%
14.9%
0.4%
8.1%
8.0%
Mar 15
15.0%
0.5%
Non performing
7.9%
5.6%
Mar 14
7.9%
5.8%
Jun 14
Non performing
6.1%
Sept 14
Unlikely to pay
6.4%
Dec 14
Past due
6.5%
Mar 15
Mar 14
56.5%
56.6%
55.4%
63.7%
63.9%
64.3%
Unlikely to pay
Past due
19.2%
7.6%
18.3%
8.1%
18.5%
6.9%
Total doubtful loans
41.0%
40.7%
38.5%
47.2%
47.0%
45.9%
In bonis
0.6%
0.6%
0.5%
Total loans
9.8%
9.6%
8.5%
including write-off
8.0%
Dec 14
including write-off
*: with reference to the new supervisory rules that took effect on 1 January 2015, and in particular the 7th update of Bank of Italy Circular 272/2008, which redefined the categories of
impaired financial assets known as "non-performing exposures", with the creation of a new category of probable defaults known as "unlikely to pay" and the elimination of watchlist and
restructured loans.
Page | 19
Doubtful loans (2/2)
Unlikely to pay inflows/outflows*
Non performing (Sofferenze) inflows/outflows*
(gross figures; €/mn)
(gross figures; €/mn)
138.0
143.0
115.0
491.0
377.9
-75.0
-20.0
102.5
215.9
454.0
380.0
309.9
395.0
370.0
403.5
337.0
129.8
279.1
241.2
157.0
-353.0
-227.0
-339.0
-400.0
-470.0
-25.3
-27.1
-25.6
-27.2
4Q14
1Q15
-176.6
1Q14
2Q14
3Q14
Inflows
Outflows
4Q14
1Q15
Net flows
1Q14
2Q14
3Q14
Inflows
Outflows
Net flows
*: Figures from data management system and referred to commercial banks within the Group (excl.CR Bra);
Data showed in the boxes referred to inlfows/outflows and don’t take into consideration other increases/decrease
•
1Q15 trends.
•
unlikely to pay loans:
• 1Q15 records the lowest level of inflows in the last 6 quarters
• Significant reduction of outflows mainly into non performing cathegory
•
non performing loans:
•
inflows in the 1Q15 significantly down, the lowest level in the last 3 years
Note: 3Q14 non-peforming loans (Sofferenze) outflows record the disposal of the residential mortgage NPL portfolio “Systema Mutui” already finalized in 2Q14 but accounted on 10 July 2014
with the transfer of the loans and payment of the consideration under a contract signed at the end of Jun.’14 (165.8 €/mn gross value)
Page | 20
Financial Assets
Financial Assets breakdown (€/mn; %)
€/mn
Bonds
Equity
Funds and Sicav
Other*
Group
HFT
687
72
54
266
1,080
CFV
38
71
109
AFS
7,061
374
154
7,589
HTM
2,522
2,522
Total
10,308
447
279
266
11,300
% on total
•
Financial assets portfolio at 11.3 €/bn, up by 1 €/bn since Dec.’14
•
Bond portfolio at 10.3 €/bn of which 6.7 €/bn of Italian Government
bonds (duration 3.9 years stable vs Dec.’14)
• Italian govies account for 130% of tangible shareholders’ equity
•
AFS net reserve as of 31 Mar.’15 at +272.6 €/mn of which 147.6 €/mn on
govies (respectively +211.3 €/mn and +97.9 €/mn in Dec.’14)
•
Implicit positive reserve of 242.7 €/mn on HTM portfolio calculated as
difference between the fair value and the book value
91.2%
4.0%
2.5%
2.3%
100.0%
* Derivatives for hedging purposes
Note: 459.4 €/mn of Loans and Receivables (banks and customers) not included
Financial Assets (€/bn)
+9.7%
Bond portfolio by issuer (€/bn)
Total figures
8.0
10.3
8.6
8.6
9.4
0.4
0.4
0.4
0.4
1.8
2.0
6.2
6.4
6.2
6.7
7.0
Mar 14
Jun 14
Sept 14
Dec 14
Mar 15
0.4
1.4
Government
Corporate & ABS
2.2
2.9
Supranational
Page | 21
Financial Assets details
Govies & Supranational PTF by issuing country (€/bn)
Total figures
6.6
0.2
0.4
6.8
6.6
0.2
0.2
0.4
7.2
0.1
0.4
Italian Govies PTF by accounting valuation (€/bn)
Total figures
7.4
0.3
0.4
0.4
6.2
6.0
6.2
6.0
0.8
Mar 14
6.6
6.0
Jun 14
Sept 14
Italy
Dec 14
Supranational
0.9
1.5
0.4
0.5
0.5
1.0
0.4
Mar 15
3.9
5.4
3.3
3.5
4.8
5.0
4.7
4.7
4.7
Mar 14
Jun 14
Sept 14
Dec 14
Mar 15
AFS
Other
HFT
Duration
(Years)
HTM
Italian Govies PTF Maturities* (€/bn)
Total figures
Total figures
0.5
1.5
6.7
Italian Govies PTF by coupon (€/bn)
6.0
6.0
0.8
0.4
6.7
6.6
6.2
6.0
0.7
0.2
0.9
0.9
6.6
6.7
0.5
0.3
0.8
2.1
0.9
1.3
0.91
0.02
0.09
4.6
Mar 14
5.3
4.9
4.6
Jun 14
Sept 14
Fixed
Floating
Dec 14
5.5
Mar 15
0.6
0.8
0.6
0.10
0.05
0.08
0.04
0.06
0.05
0.50
0.47
2015
2016
0.3
1.23
0.77
2017
AFS
ZC
2018
HFT
0.14
0.07
0.07
2019
0.2
1.04
0.12
0.01
0.08
2020
> 2020
HTM
*: figures are shown as per nominal values
Page | 22
Agenda
1Q15 Results
 Profit and loss
 Assets
 Annexes
Page | 23
Direct funding
Total Direct Funding (€/mn)
-2.0%
•
Direct funding down by 2.0% y/y (-0.9 €/bn) and down by 1.9% since
Dec.’14 (-0.9 €/bn)
•
1Q15 key trends:
-1.9%
•
Current accounts and
sight deposits
Term deposits
Repurchase agreements
Other short-term loans
Bonds
- subscribed by
institutional customers
- subscribed by ordinary
customers
Certificates of deposit
Direct customer deposits
Mar 15
Dec 14
Mar 14
Jan.’15: 750 €/mn Covered bond issue (total outstanding at 1.75
€/bn)
•
Direct funding reduction also due to switch to AuM and
bancassurance products
•
Retail bond maturities only partially replaced by new issues
•
Reduction of expensive funding from customers, mainly corporate
Total wholesale and covered bonds account only around 2 €/bn. No
wholesale bond maturities in 2015 and only 0.3 €/bn in 2016-17 providing
flexibility to the Group’s funding strategy
Direct Funding breakdown by customer segment (%)
Direct Funding breakdown (%)
€/mn
•
Chg vs Dec '14
(%)
Large
Others
Corporate 3.8%
2.6%
Chg y/y
(%)
26,848
2,525
1,313
2,447
8,354
27,487
2,969
1,063
2,445
8,320
25,699
3,556
1,506
2,321
9,574
-2.3%
-14.9%
23.5%
0.1%
0.4%
4.5%
-29.0%
-12.9%
5.5%
-12.7%
2,010
1,249
1,262
61.0%
59.3%
6,344
7,071
8,312
-10.3%
-23.7%
3,808
3,899
3,584
-2.3%
6.2%
45,295
46,183
46,241
-1.9%
-2.0%
Corporate
12.1%
Retail &
Private
81.5%
Page | 24
Bonds maturities and issues details
Bonds issues (€/bn)
Total figures
•
Bonds stock decline by 12.7% y/y but broadly stable q/q
(+0.4%). Substitution of retail bonds in favour of cheaper
wholesales ones (Covered bond)
•
Covered bond new issue of 750 €/mn in Jan.’15 expiring in
2022
•
Total wholesale bond (issues under the EMTN Programme
and covered bonds) account only around 2 €/bn. No
wholesale bond maturities in 2015 and only 0.3 €/bn in 201617 providing flexibility to the Group’s funding strategy
Bonds maturities breakdown (€/bn)
2015 Bonds maturities (€/bn)
8.2 €/bn
2.4 €/bn
Total figures
1.7 €/bn
1.7
1.8
1.7
Total figures
0.1
1.3
1.7
1.2
1.0
0.2
1.6
0.8
0.5
1.1
0.8
2015*
* Remaining 3 quarters
2016
2017
Retail
2018
EMTN
0.5
0.4
2019
beyond
Covered Bond
Note: figures in this page: 1) are shown as per nominal values and 2) may not add exactly due to rounding differences
Page | 25
Eligible assets and counterbalancing capacity
Total eligible Assets evolution* (€/mn)
Eligible Assets Pool Composition (%)
+1.3%
12,054
11,480
12,001
11,632
11,508
6,234
4,633
4,201
3,917
Mar 14
Jun 14
Total eligible assets
Sept 14
Dec 14
4,427
Mar 15
Unencumbered eligible assets
*: Net of ECB haircuts
•
Counterbalancing capacity (CBC) as of Mar.’15 at 11.6 €/bn of which 4.4 €/bn unencumbered
•
In Dec.’14, CBC was at 11.5 €/bn of which 4.6 €/bn unencumbered
•
ECB TLTRO programme ("Targeted Long Term Refinancing Operations"): 2 €/bn allotment in Sept.’14 auction
•
ECB exposure as of Mar.’15: 3.3 €/bn of which 1.3 €/bn attributable to short-term Repos and 2 €/bn to 4Y TLTRO
Page | 26
Basel 3 Phased in regulatory capital (pre-AIRB validation)
B3 Common Equity Tier 1 Phased in Ratio (%)
•
B3 CET1
Fully Phased*
•
Capital ratios further improvement vs Dec,.’14 excluding potential
benefits from internal models (“AIRB”) validation:
•
CET1 ratio pro-forma Phased in at 11.43% (11,26% in Dec,’14):
+17 bps
•
CET1 ratio pro-forma Fully Phased* at 11,28% (10,91% in
Dec.’14): + 35 bps mainly due to the application of the B3
transitional regime and the increase of the AFS reserve
RWA slight decline by 1,1% (-0,5 €/bn since Dec.’14) due to volumes
trend and coverage improvement (credit risk capital requirements
reduction of 45 €/mn)
Capital & ratios
Capital requirements
B3 Phased in
€/mn
Mar 15 (*) Dec 14
Sept 14 (*)
Common Equity TIER 1
4,599
4,581
4,676
TIER 1
4,616
4,592
4,697
Own Funds
4,934
4,982
5,495
Total RWA
40,237
40,692
42,148
Common Equity TIER 1 Ratio
11.4%
11.3%
11.1%
TIER 1 Ratio
11.5%
11.3%
11.1%
Own Funds Ratio
12.3%
12.2%
13.0%
Requirements as of Mar 15
Credit risk
€/mn
%
2,843
88.3%
Credit Valuation Adjustment (CVA)
26
0.8%
Market risk
55
1.7%
7
0.2%
288
9.0%
3,219
100.0%
Other regulatory equirements
Operating risks
Total
(*): Common Equity Tier 1 ratio pro-forma ("CET1") calculated taking into account the share of profits attributable to equity earned during the period and the net effects accrued during the same period
from application of the fair value option. Fully Phased CET1 estimated according to the new Basel 3 regulations on a "fully phased" basis at January 2019.
Page | 27
Agenda
1Q15 Results
 Profit and loss
 Assets
 Annexes
Page | 28
Assets & Liabilities: reclassified balance sheet
Assets*
€/mn
Mar 15 Dec 14 Sept 14
Liabilities & Shareholders’ equity*
Jun 14
Mar 14
Chg vs
Dec '14 (%)
€/mn
Mar 15 Dec 14 Sept 14
Jun 14
Mar 14
Chg vs
Dec' 14 (%)
Customer Loans
43,865 43,920
44,581
45,417
45,849
-0.1%
Securities Portfolio
11,300 10,302
9,510
9,439
8,874
9.7%
Customer Deposits
45,295 46,183
46,276
45,712
46,241
-1.9%
6,945
6,845
6,920
6,400
9.3%
Net Interbank Position
5,504
4,770
3,412
5,705
4,897
15.4%
1,785
1,764
1,764
1,756
-0.8%
Other Funds & Liabilities
2,848
2,481
3,215
3,125
2,928
14.8%
Shareholders' equity
5,612
5,510
5,551
4,777
4,783
1.9%
2,937
2,599
2,699
2,370
-20.9%
Total Liabilities
59,259 58,944
58,454
59,319
58,849
0.5%
59,259 58,944
58,454
59,319
58,849
0.5%
of which AFS 7,589
Equity Investments,
1,770
Properties & Intangibles
Other current assets
2,324
Total Assets
* Total Assets shown as net of loans to banks
*Total Liabilities inclusive of “Net Interbank Position” (Due to banks - Loans to banks)
Page | 29
Asset quality breakdown
Mar 15
Gross exposure (€/mn)
Doubtful loans
Non-performing loans
Unlikely to pay loans
Past due loans
Gross performing loans
Total gross exposure
A
11,165
6,593
4,336
236
37,481
48,646
Dec 14
%
23.0%
13.6%
8.9%
0.5%
77.0%
100.0%
B
10,998
6,487
4,302
209
37,604
48,602
Mar 15
Mar 14
%
22.6%
13.3%
8.9%
0.4%
77.4%
100.0%
C
%
21.0%
11.6%
8.9%
0.5%
79.0%
100.0%
10,520
5,793
4,452
275
39,590
50,110
Dec 14
Chg
31/3 - 31/12 (A-B)
Mar 14
Adjustments to loans (€/mn)
A
coverage (%)
4,575
3,725
832
18
206
4,781
Adjustments to doubtful loans
Past due loans
Adjustments to performing loan
Total adjustments
41.0%
56.5%
19.2%
7.6%
0.5%
9.8%
A
6,590
2,868
3,504
218
37,276
43,865
coverage (%)
4,472
3,668
786
17
211
4,682
Mar 15
Net exposure (€/mn)
Doubtful loans
Past due loans
Net performing loans
Total net exposure
B
C
40.7%
56.5%
18.3%
8.1%
0.6%
9.6%
Dec 14
%
15.0%
6.5%
8.0%
0.5%
85.0%
100.0%
B
6,527
2,819
3,515
192
37,393
43,920
coverage (%)
4,049
3,208
822
19
211
4,261
38.5%
55.4%
18.5%
6.9%
0.5%
8.5%
Mar 14
%
14.9%
6.4%
6.6%
0.4%
85.1%
100.0%
C
6,470
2,584
3,630
256
39,379
45,849
Chg
31/3 - 31/12 (A-B)
Abs.
Chg (%)
166
1.5%
105
1.6%
34
0.8%
26
12.6%
-122
-0.3%
44
0.1%
%
14.1%
5.6%
7.9%
0.6%
85.9%
100.0%
Abs.
Chg (%)
103
56
46
1
-5
98
2.3%
1.5%
5.8%
6.2%
-2.4%
2.1%
Chg
31/3 - 31/12 (A-B)
Abs.
Chg (%)
63
1.0%
49
1.7%
-12
-0.3%
25
13.2%
-117
-0.3%
-55
-0.1%
Chg
31/3 - 31/3 (A-C)
Abs.
Chg (%)
645
6.1%
800
13.8%
-116
-2.6%
-40
-14.4%
-2,109
-5.3%
-1,464
-2.9%
Chg
31/3 - 31/3 (A-C)
Abs.
Chg (%)
526
516
10
-1
-5
520
13.0%
16.1%
1.2%
-4.9%
-2.6%
12.2%
Chg
31/3 - 31/3 (A-C)
Abs.
Chg (%)
119
1.8%
284
11.0%
-126
-3.5%
-39
-15.1%
-2,104
-5.3%
-1,984
-4.3%
Page | 30
Indirect deposits and “bancassurance”
Total Indirect Deposits and bancassurance* (€/mn)
+9.9%
48.1%
30,457
31,169
2,718
2,971
11,919
51.3%
13,004
15,820
52.8%
15,194
Mar 14
Assets under custody
+7.4%
•
Indirect deposits and bancassurance* significantly up by 9.9% y/y (+3.0
€/bn) and up by 7.4% since Dec.’14 (+2.3 €/bn) even better than new
Business Plan 15-17 estimates:
33,472
•
AuM up by 20.1% y/y and up by 10.1% since Dec.’14
3,342
•
AuM composition: in the 1Q15, Cash still decreasing in favour of
different kinds of Funds (equity, balanced, Flexible)
14,315
•
Significant growth in bancassurance* both y/y and in the 1Q15
(respectively +22,9% and +12,5%)
•
AuC broadly stable y/y and up by 4,1% in the 1Q15 minly due to
temporary institutional counterparties inflows
15,815
Dec 14
Mar 15
Assets under management
Bancassurance (stock)
•
Well on track on indirect deposits remix strategy in line with new Business
Plan 15-17 guidelines: AUM and bancassurance* increased to 52.8% from
51.3% in Dec.’14, increasing its weight on total indirect funding
AUM net inflows1 (€/mn)
+157.5%
AUM composition1 (%)
100%
100%
100%
+270 bps
Change
y/y
*: life-insurance products
(1): figures from data management system
Page | 31
Performance ratios
Structural ratios (%)
net loans to customers/total assets
Capital and liquidity ratios
31.03.2015
2014(*)
72.38%
72.41%
Common Equity ratio (CET1 ratio) - Phased in
11.43%
11.26%
11.47%
11.29%
12.24%
10.91% (5)
net loans and advances to customers/direct deposits from customers
96.84%
95.10%
Tier 1 ratio (T1 ratio) - Phased in
financial assets/total assets
18.65%
16.99%
Total Capital ratio (TC ratio) - Phased in
12.26%
11.28%
fixed assets/total assets
goodwill/total assets
direct deposits/total assets
deposits under management/indirect deposits
financial assets/tangible equity
Total tangible assets/tangible equity
net interbank lending/borrowing (in thousands of Euro)
2.11%
2.12%
Common Equity ratio (CET1 ratio) - Fully Phased
0.63%
0.63%
Leverage ratio - Phased in
7.2%
7.2%
7.1%
6.9%
125%
86.04%
86.83%
Leverage ratio - Fully Phased
47.51%
46.12%
Liquidity coverage ratio (LCR)
117%
Net stable funding ratio (NSFR)
n.d.
2.21
11.74
2.06 (1)
12.00 (2)
(5,503,915)
(4,770,260)
11,552
11,593
1,273
1,273
31.03.2015
2014(*)
ROE
3.75%
ROTE
4.17%
ROA (net profit/total assets)
0.09%
number of employees
number of national bank branches
Profitability ratios (%)
Cost/income ratio
55.90%
115% (6)
Non financial ratios
Productivity ratios (in thousands of Euro)
31.03.2015
2014(*)
direct deposits per employee
3,920.96
3,983.71
loans and advances to customers per employee
3,797.19
3,788.47
0.33%
assets managed per employee
1,239.15
1,121.71
0.37%
assets administered per employee
1,369.07
1,310.60
0.05%
core revenues per employee
42.70
43.06
net interest and other banking income per employee
46.71
48.55
operating costs per employee
26.74
25.55
53.01% (3)
Net adjustments to loans /net loans to customers
0.34%
0.46%
Basic EPS
0.094
0.084
Diluted EPS
0.094
0.084
31.03.2015
2014(*)
net doubtful loans/net loans to customers
15.02%
14.86%
net non-performing loans/net loans to customers
6.54%
6.42%
Risk ratios (%)
2014(*) (4)
31.03.2015
net unlikely to pay loans/net loans to customers
7.99%
8.00%
net past due loans/net loans to customers
0.50%
0.44%
adjustments to doubtful loans/gross doubtful loans
40.98%
40.66%
adjustments to non-performing loans/gross non-performing loans
56.50%
56.55%
adjustments to unlikely to pay loans/gross unlikely to pay loans
19.19%
18.28%
adjustments to past due loans/gross past due loans
7.61%
8.07%
adjustments to performing loans/gross performing loans
0.55%
0.56%
(*) The comparative figures for the income statement are as at 31 March 2014, except for the ROE and the ROTE which are calculated on a
yearly basis.
(1)
Tangible equity = total shareholders' equity net of intangible assets
(2)
Total tangible assets = total assets net of intangible assets
(3)
The cost/income ratio has been calculated on the basis of the layout of the reclassified income statement (operating
expenses/operating income); when calculated on the basis of the layouts provided by Circular no. 262 of the Bank of Italy the
cost/income ratio is at 57.25% (52.64% at March 31, 2014).
(4)
Capital and liquidity ratios at 31 March 2015 have been calculated on a pro-forma basis, taking into account the share of profits
attributable to equity earned during the first quarter of 2015 and the net effects accrued during the same period from application of the
fair value option (a total of € 40.5 million). On the other hand, they do not take into account the benefits of internal models (prevalidation of the AIRB models with the ECB and the Bank of Italy officially begun at the end of January 2015).
(5)
Common Equity Tier 1 ratio (CET1 ratio) – Fully Phased: as stated in the previous paragraph, it is calculated on a pro-forma basis
and estimated according to the new Basel 3 regulations at January 2019.
(6)
The NSFR, not yet available, it is in any case estimated to exceed 100%, in line with the figure at 31 December 2014.
Page | 32
Agenda
1Q15 Results
 Profit and loss
 Assets
 Annexes
Page | 33
Summary of the programme
Summary of the Covered Bond programme
Issuer
Banca popolare dell’Emilia Romagna Società Cooperativa (“BPER")
Seller
BPER
Programme size
EUR 5bn
Guarantor
Estense Covered Bond Srl (SPV ex 130/1999)
Cover Pool
100% Italian prime, first economic lien residential mortgages originated by the BPER Group
Segregation of collateral
Collateral sold to the Guarantor is segregated for the benefit of CB holders and other secured parties in the context of the programme
Listing
Luxembourg
Over-collateralization
The statutory tests are run quarterly to ensure sufficient programme support
Minimum Over-collateralization
19% committed, corresponding to 84.03% as Asset Percentage
Calculation Agent
BPER
Guarantor Calculation Agent
Securitisation Services S.p.A.
Asset Monitors
Deloitte & Touche S.p.A.
Governing Law
Italian
Representative of CB holders
Securitisation Services S.p.A.
Arranger and Dealer
The Royal Bank of Scotland plc
Page | 34
OBG Programme structure overview
Italian Covered Bond Framework
Covered
Bondholders
OBG
Covered Bond Guarantee
Covered Bond
Issuance
Proceeds
Covered Bond
Issuance
& Coupons
Subordinated Loan
Repayments of
Subordinated Loan
Estense Covered
Bond S.r.l.
(Guarantor)
Asset monitor
Cover Pool Purchase Price
Transfer of Cover Pool
Swap
Cashflows
Covered Bond
Swap Counterparty
Page | 35
Statutory tests
MANDATORY TESTS (according to the Italian regulation framework)
NOMINAL VALUE TEST
The Outstanding Principal Balance of the Eligible Cover Pool (that means Not Performing Loans excluded) plus the
aggregate amounts standing to the credit of the SPV accounts (in relation to the principal component only) ≥ the
Outstanding Principal Notional Amount of all Series of Covered Bonds
NET PRESENT VALUE TEST
The Net Present Value of the Eligible Cover Pool (that means Not Performing Loans excluded), net of the SPV general
and administrative expenses and including any cash flow expected on derivatives ≥ the Net Present Value of the
Outstanding Covered Bonds
INTEREST COVERAGE TEST
The Net Interest Collections from the Eligible Cover Pool (that means Not Performing Loans excluded), including any
cash flow expected on derivatives ≥ the interest payments scheduled to be due in respect of all the outstanding Series of
Covered Bonds
ADDITIONALY TEST (assumed in the legal documentation according to the Rating Agency requirements)
The Adjusted Eligible Portfolio ≥ the Outstanding Principal Balance of all Series of Covered Bonds
The Adjusted Eligible Portfolio is the lower between:
ASSET COVERAGE TEST
i) the Outstanding Principal Balance of every Mortgage Loan
ii) the Mortgage Loan latest real estate appraisal value,
weighted on the loan performance level, taking in consideration the haircut depending on the Asset Percentage, plus
the aggregate amounts standing to the credit of the SPV accounts (in relation to the principal component only), minus
any set-off amount, commingling amount and negative carry factor calculation.
Page | 36
BPER Group’s residential mortgages business
Residential mortgages stock (€/bn)
Residential mortgages by interest type (%)
8.21
8.10
0.11
0.11
0.10
1.19
8.18
0.08
1.19
1.32
1.28
6.67
6.82
6.78
6.87
6.92
2011
2012
2013
2014
1Q15
1.23
1m
Residential mortgages by payment frequency (€/bn)
8.14
8.11
6m
0.08
other
Residential mortgages new production (€/bn)
Source: figures from data management system ; gross values; Commercial banks excl. CR Bra
Note: figures in the tables above may not add exactly due to rounding differences
Page | 37
Cover Pool: Summary (1/3)
Residential cover pool summary data
Country
Total Loan Balance (€)
Average Loan Balance (€)
Borrower concentration: largest 10 borrowers
Total number of Loans
Total number of Borrowers
Total number of Properties
Loans to employees of BPER Group
Weighted average seasoning (months)
Weighted average remaining maturity (months)
Weighted average original term (months)
Weighted average OLTV (granted balance / original property valuation)
Weighted average CLTV (current balance / original property valuation)
Weighted average Indexed CLTV (current balance / updated property valuation)
Fixed Rate
Mixed - Fixed as of this report date
Floating Rate
Mixed - Floating as of this report date
Foreclosure (non performing loans)
WA interest rate on floating loans (Mixed - Floating included)
WA margin on floating loans (Mixed - Floating included): basis points
WA interest rate on fixed loans (Mixed - Fixed included)
Loans in arrears > 90 days - defaulted included
Italy
2,242,579,649
91,106
0.41%
24,615
24,405
25,340
0
53.69
202.10
255.28
58.01%
48.42%
49.35%
8.60%
5.98%
27.52%
57.57%
0.33%
2.36%
195
4.76%
0.71%
Data as of 31 March 2015
Page | 38
Current Loan to Value
Current Loan to Value – Key Data
Total Loan Balance
(€)
% of Total Loan
Balance
Number
of Borrowers
% of Number
of Borrowers
0-≤40%
711,259,820
31.72%
11,961
49.01%
>40%-≤50%
352,708,785
15.73%
3,363
13.78%
>50%-≤60%
390,948,238
17.43%
3,316
13.59%
>60%-≤70%
457,185,162
20.39%
3,442
14.10%
>70%-≤80%
320,869,085
14.31%
2,261
9.26%
>80%-≤85%
9,608,559
0.43%
63
0.26%
2,242,579,649
100.00%
24,405
100.00%
Current LTV ranges
Page | 39
Geographical distribution*
* In % of Total Loan Balance – Borrower ‘s residence
Interest Rate Type
Seasoning
Seasoning
(in months)
<12
≥12-<24
≥24-<36
≥36-<60
≥60
Total
Total Loan Balance % of Total Loan
(€)
Balance
19,894,241
231,469,543
247,394,480
955,567,259
788,254,126
2,242,579,649
0.89%
10.32%
11.03%
42.61%
35.15%
100.00%
Page | 40
Origination and underwriting
MANDATORY TESTS (according to the Italian regulation framework)
Sales Force
 All mortgages are originated through direct channels
- 1,273 branches across the Italian territory of which:
 816 BPER branches
 456 subsidiary branches
 All mortgages are underwritten at branch level
Underwriting
 Mortgage approval depends mainly on the value of the property vs. the amount requested, as well as on the clients income,
net worth and the in-house credit rating score of the client
 The credit rating score is a synthetic valuation of the credit quality of the underlying risk
Property Valuation
 Since 1st November 2006 the valuation of residential properties is assessed at the granting date by an independent appraisal
company, CRIF Service S.p.A.. The following valuation update is scheduled, at least, once a year with the assessment of a
different independent appraisal company: Prelios S.p.A..
 BPER performs all of the servicing activities of the mortgage loan portfolio
Servicing
 Collection strategies are in place to achieve the quickest and most effective recovery of loans in arrears
 The majority of loans are paid through direct debit, reducing delinquency (early detection of overdues) and allowing for a
more proactive servicing of the loans
Page | 41
The underwriting process
Italian Covered Bond Framework
2
1
DATA COLLECTION AND INPUT
 Collection of documentation from the
borrower (financial status & credit
performance; property description,
location and type)
5
SANCTIONING
6
PRE-CLOSING PROCEDURES
 Execution of loan & guarantor’s
contract
 Signing of insurance contracts &
settlement of any insurance payment
 Notarisation of the mortgage
agreement
 Registration of the mortgage / lien
over the property
INTERNAL RATING AND SCORING
 Assessment of the borrower’s credit
worthiness via an internal scoring model,
based on borrower characteristics and
loan amount
ANALYSIS OF KEY FACTORS FOR
CREDIT DECISION:
 Minimum mortgage requirements:
 Citizenship and residency
 Age
 Credit period
 Debt to income
 Loan to Value
 Guarantees
 Internal credit rating
 Appraisal of the property
3
PROPERTY VALUATION
 Residential mortgages are granted
only if the property valuation is
assessed by the independent appraisal
company CRIF Service S.p.A.
regardless of amount or scope
4
ASSIGNMENT OF FILE ACCORDING
TO LIMITS
 On the basis of the internal limits and
of the borrower’s and loan
characteristics, the file is assigned to
the appropriate responsible for the
credit decision
CLOSING
Page | 42
Cover Pool | Performance
Arrears (months)
Number of Loans
% Number of
Loans
Current Balance (€)
% Current
Balance
0 (in bonis )
23,853
96.90%
2,164,111,762
96.50%
≤1m
303
1.23%
32,865,678
1.47%
>1m to ≤2m
211
0.86%
19,377,464
0.86%
>2m to ≤3m
98
0.40%
10,195,844
0.45%
>3m to ≤6m
81
0.33%
8,689,556
0.39%
Non Performing
69
0.28%
7,339,345
0.33%
Total
24,615
100.00%
2,242,579,649
100.00%
Page | 43
Rating
Rating Overview of Italian Covered Bond Issuers (Moody’s/S&P/Fitch)
Republic
Intesa
Unicredit* UBI Banca
of Italy
Sanpaolo
BPER
Banca Pop.
di Milano
Banco
Popolare
Carige
MPS
CREDEM
LT Issuer Default
n.r.
Ba3
Ba3
Caa1
B3
Baa2
Baa1
Baa1
Baa2
Baa2
Covered Bond
A1
A2
A2
Ba1
A2
Aa2
Aa2
n.r.
Aa2
n.r.
Outlook
n.r.
Stable
Stable
Pos
Neg
Stable
Stable
Stable
Stable
Stable
LT Issuer Default
BB-
B+
n.r
B-
n.r
BBB-
BBB-
BBB-
BBB-
BBB-
Covered Bond
n.r.
n.r
n.r
n.R
n.r
n.r
n.r
n.r.
n.r
n.r
Stable
Stable
n.r
CW-
n.r
Stable
Stable
Stable
Neg
Stable
LT Issuer Default
BB
BB+
BB
B
B-
BBB+
BBB+
BBB+
BBB
BBB+
Covered Bond
n.r.
BBB+
BBB+ (RW-)
BBB-
BBB
A+
n.r.
AA+
A
n.r.
Stable
Stable
Stable
Stable
Stable
Neg
Stable
Stable
Stable
Stable
Outlook
Outlook
Source: Bloomberg as of 20 July 2015
Outlook refers to long-term ratings
Moody’s: RuR -/+ (Rating under Review Neg/Pos)
Standard and Poor’s: CW -/+ (Credit Watch Neg/Pos)
Fitch: RW +/- (Rating Watch Neg/Pos)
n.r.: Not Rated
*: UniCredit ratings relate to their CPTCB programme; Soft bullet programme ratings are: Aa2 / - / AA (M/S/F)
Page | 44
Agenda
1Q15 Results
 Profit and loss
 Assets
 Annexes
Page | 45
Growth trends for residential mortgages
•
In the past the increase in interest rates was the main cause of the
slowdown in mortgage growth in Italy
Late-stage arrears and annual default rate have been remarkably stable (at
1.6% and 1.3% respectively), despite the weak economic background.
Starting from June 2008, the deceleration was due to the economic
recession and the weakness of consumer spending
Market expectations for new residential mortgage lending in Italy are flat for
2014 with sign of growth in 2015
The reduction in sovereign bond rates has reduced funding spread for
banks: this has been leading to lower mortgage rates
Average interest rates on new mortgages have decreased by almost 100 bps
since 2012
3
2
1
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Germany
Spain
Portugal
40
165
20
125
0
85
(20)
45
(40)
Source: Fitch, Central Banks, National Statistical Institutes, EMF, Loan Performance, CML, DNB, IBF,
JHF, CBA
Q4 2014
Q1 2014
Q2 2013
Q3 2012
Q4 2011
(60)
Q1 2011
2014 f
2015 f
Greece
Portugal
Q2 2010
2012
2013
Germany
Netherlands
Q3 2009
2010
2011
France
Italy
United Kingdom
Q1 2005
2009
Portugal
The Netherlands
Change (%) in the volumes of residential household
mortgage issuances and household transactions
205
2008
Belgium
Ireland
Spain
The Netherlands
Italy
40
35
30
25
20
15
10
5
0
(5)
(10)
Source: S&P
Gross new mortgages lending
5
2007
Italy
Germany
Spain
Q4 2008
•
4
Q1 2008
•
5
Q2 2007
•
6
Q3 2006
•
7
Q4 2005
•
Housing loans v/s Interest rates on New housing loans
Housing loans
(% year-on-year change)
2014 has been a recovery year for Italy for the increased number of
residential household purchase: +7.4%
Average interest rates on new
housing loans (%)
•
*
Var. % mutui casa (*)
Var. % compravendite
Source: Bank of Italy, Nomisma, Italian Tax Authority
Page | 46
Very Stable Housing Market in Italy
Price Indexes
(% change current/previous period)
FUTURE TRENDS:
5.0%
The stabilization in Italy's residential property market reflects: i)
economy slight recovery and easing credit conditions; ii) increase in
consumer confidence
(5.0%)
Overall, households financial exposure remains balanced thanks to
their relatively modest indebtedness and a lowered interest rates
environment
0.0%
(10.0%)
(15.0%)
2012
UK
2013
France
2014 (F)
Germany
Ireland
2015 (F)
Italy
2016 (F)
Portugal
Spain
Source: S&P Rating Services
Affordability of the housing market
(Price/Income ratio)
Housing Price Indexes
GBR
ESP
GRC
Source: OECD, RBS; Note: index based in 2010, Southern Europe
ITA
IRL
GBR
ESP
GRC
IRL
2014
2013
2012
2011
2010
2009
2004
2003
2002
2001
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
ITA
2000
160
150
140
130
120
110
100
90
80
70
60
50
40
30
150
140
130
120
110
100
90
80
70
60
2008
•
Assuming a modest strengthening of the economy, prices will start
to gradually rise again by 1% in 2015 and 2% in 2016
2007
•
10.0%
2006
•
As of S&P 2014 report, Italian housing price will decline more slowly
this year than in the recent past (2%)
2005
•
*
Source: OECD, RBS
Page | 47
S&P’s Housing Market Forecasts
S&P’s House Price Forecasts
Italy
France
Germany
Spain
Ireland
Assuming a modest strengthening of the economy, S&P expects the performance of the industry is
forecast to accelerate, with an anticipated CAGR of 0.6% for the five-year period 2013- 2018, which is
expected to drive the industry to a value of $79.6bn by the end of 2018. It expects real GDP to rise by 0.5%
in 2014, and have lifted their forecasts for 2015 to 1.1% and for 2016 to 1.2%. Supporting an ease in house
price declines, however, the real estate market itself does not show signs of significant overvaluation.
The price-to-income ratio, a good indicator of affordability, has declined markedly from its 2009 peak and
is now close to its long-term average. Similarly, the price-to-rent ratio remains at its historical average as
rents continue to rise
S&P expects house prices will decline by 4% in 2014 and grow by 1% in 2015 and 2% in 2016. However, an
interest rate shock, although currently unlikely, would throw the market into sharper decline. It expects
the economic revival in France to be slow, with real GDP growth averaging 0.7% this year, below the
eurozone average of 1.1%. Growth is likely to pick up only gradually in 2015 and 2016, remaining below 2%,
and its expected that unemployment will come down only very slowly. Against this backdrop, structurally
strong housing demand will continue to support the market. However, future trends will be highly
dependent on interest rates. The ECB is committed to keeping interest rates very low at the short end of
the curve. In the longer run, investor demand for safe haven investments should remain strong.
S&P forecasts that the upswing in the German residential property market will continue over the next
few years amid strong macroeconomic indicators. On the back of solid economic growth, employment
and wage growth should accelerate, boding well for household incomes. However, if investment in
residential construction continues to expand at the same fast rate seen in the past, pressures on prices
may start to ease in the coming years. Low financing rates and a yearning for financial safety will
continue to lift house prices for some time, in our view. We expect financial conditions to remain
supportive, at least until 2016. However, as we believe the period of low interest rates outside the
eurozone is nearing, investment in the German residential property market is likely to become less
attractive and raise international investors' interest in other financial assets in the years to come,
additionally easing pressures on prices. Hence, we forecast price increases will slow to a 3.5% growth in
2016.
S&P believes prices will continue to decline slightly this year, bottom out in 2015, and start to rise in 2016.
Economic fundamentals are improving faster than previously expected. Over the longer term, the very
high stock of unsold new homes will still dampen prospects for a sustained recovery in prices. Although
construction of new buildings has been very slow in recent years, the stock of unsold houses has been
only slowly declining. Declining demographic trends will also weigh on housing demand and house-price
growth
House Price Change Forecast
8
6
4
2
0
-2
-4
-6
-8
-10
-12
2012
S&P views that the improvement in the economy and the labor market, as well as limited supply in Dublin
will help support the residential property market over the next two years. The improving labor market
situation, alongside rising employment and wages, should support a continued increase in housing
demand. A rise in demand in the context of home supply shortages (mainly in urban areas such as Dublin)
will likely put upward pressure on prices, leading to rises nationally. The damage or bankruptcy that many
building firms suffered during the financial crisis has contributed to the housing supply shortage. We
nevertheless don't expect the recent increase in house prices to stay as strong beyond 2014
2013
2014f
2015f
2016f
Belgium
France
Germany
Ireland
Italy
Netherlands
Portugal
Spain
Sw itzerland
U.K.
Source: S&P
Source: S&P (as of December 2014)
Page | 48
Household Leverage & Mortgage Collateral Quality
S&P’s House Price Forecasts
House Price Change Forecast
25%
Italy
-45
Belgium
-53
20%
France
-55.1
Germany
-61.6
Spain
-85.7
250
300
Liabilities
Liquid Assets (incl. Cash, Deposits, ST Securities, Shares, Equity)
350
0%
Illiquid Assets
Spain
200
Denmark
150
Ireland
100
Germany
50
Belgium
0
Italy
-50
Portugal
-100
Austria
-127.1
United Kingdom
Netherlands
5%
Sweden
-118.9
Norway
Ireland
France
-99.5
Switzerland
UK
10%
Netherlands
-94.3
Finland
Portugal
-150
15%
Liability Coverage by Liquid Assets
Source: Moody’s, Eurostat
Source: Moody’s
Page | 49
Agenda
1Q15 Results
 Profit and loss
 Assets
 Annexes
Page | 50
Becoming BPER: From The Past To The Future
Page | 51
Market Conditions Expected To Improve Over The Next Few Years
Page | 52
Industrial Plan Structured Around Key Stakeholders
Page | 53
Industrial Plan Key Financial Targets
Page | 54
ROTE Target: 9% Re-Iterated
Page | 55
Top-line Improvement: Key Objectives and Actions
Page | 56
Greater Operating Efficiency: Key Objectives and Actions
Page | 57
Risk Profile Optimization: Key Objectives and Actions
Page | 58
Contacts for Investors and Financial Analysts
Gilberto Borghi
Roberto Ferrari
Head of Investor Relations
Chief Financial Officer
Via San Carlo, 8/20
Via Aristotele 195
41121 Modena - Italy
Ph. +39 059 2022194
Ph. +39 059 2021199
e-mail: gilberto.borghi@bper.it
e-mail: roberto.ferrari@bper.it
Alessandro Simonazzi
Marco Biale
Head of Planning & Control
Head of Structured Finance
Via San Carlo, 8/20
Via G. Negri, 10
20123 Milano - Italy
Ph. +39 059 2022014
Ph. +39 02 29022474
e-mail: alessandro.simonazzi@bper.it
e-mail: marco.biale@bper.it
Page | 59

Obbligazioni Bancarie Garantite Programme

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