Bank of Cyprus Group Group Financial Results for the period ended 31 March 2019 This presentation has not been audited by the Group’s external auditors. This financial information is presented in Euro ( € ) and all amounts are rounded as indicated. A comma is used to separate thousands and a dot is used to separate decimals. Important Notice Regarding Additional Information Contained in the Investor Presentation The presentation for the Group Financial Results for the quarter ended 31 March 2019 contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014. The presentation for the Group Financial Results for the quarter ended 31 March 2019 (the “Presentation”), available on https://www.bankofcyprus.com/en-GB/investor-relations-new/reports- presentations/financial-results/, includes additional financial information not presented within the Group Financial Results Press Release (the “Press Release”), primarily relating to (i) NPE 13 May 2019 analysis (movements by segments and customer type), (ii) rescheduled loans analysis, (iii) details of historic restructuring activity including REMU activity, (iv) analysis of new lending, (v) Income statement by business line, (vi) NIM and interest income analysis and (vii) Loan portfolio analysis in accordance with the three-stages model for impairment of IFRS 9. Except in relation to any non-IFRS measure, the financial information contained in the Investor Presentation has been prepared in accordance with the Group’s significant accounting policies as described in the Group’s Annual Financial Report 2018. The Investor Presentation should be read in conjunction with the information contained in the Results Announcement and neither the financial information in the Results Announcement nor in the Investor Presentation constitutes statutory financial statements prepared in accordance with International Financial Reporting Standards.
1Q2019 - Highlights • CET1 ratio of 14.9% 1,2 pro forma for Helix (13.4% as reported) Good Capital Position • Total Capital ratio of 17.9% 1,2 pro forma for Helix (16.2% as reported) • Helix legal completion process underway, following ECB’s “Significant Risk Transfer” approval received in March 2019. Completion expected during 2Q2019 Continuing • Sixteen consecutive quarters of organic NPE reduction. NPEs down c.70% since December 2014 Progress on • NPEs reduced by € 157 mn to € 4.6 bn 1 ( € 2.4 bn net) pro forma for Helix Balance Sheet repair • NPE ratio at 35% 1 and coverage at 48% 1 pro forma for Helix • Management actively exploring strategies to further accelerate de-risking including further portfolio sales • Significant liquidity surplus of € 3.8 bn pro forma for Helix Strong Liquidity • Deposits at € 16.3 bn at quarter end, down by 3% qoq, up by 1% yoy for Cyprus Position • Loan to deposit ratio of 67% pro forma for Helix • Total Income of € 176 mn, Operating profit of € 71 mn, Underlying profit 3 after tax before restructuring costs of € 23 mn • Cost of risk at 1.2% reflecting continued de-risking Positive • Helix loss of € 21 mn relating mainly to completion and timing adjustments performance in 1Q2019 • Positive impact of € 109 mn following tax legislation amendments in March 2019 • Profit after tax of € 95 mn In March 2019, the Bank received approval from the ECB for the Significant Risk Transfer (‘SRT’) benefit from Helix. Helix remains subject to various outstanding conditions precedent (refer to slide (1) 31). All relevant figures and pro forma calculations are based on 31 March 2019 financial results, unless otherwise stated. Calculations on a pro forma basis assume completion of Helix, expected to occur in 2Q2019. The pro-forma ratios include any impact from the agreement for the sale of retail unsecured NPEs of € 33 mn GBV or € 5 mn NBV (known as Project Velocity) signed in December 2018 (2) Allowing for IFRS 9 transitional arrangements (3) Profit after tax and before restructuring costs relating to NPL sale (Helix), loss relating to Helix, reversal of impairment of DTA and impairment of tax receivables 2
Good capital position CET1 ratio at 14.9% 1,2 pro forma for Helix 17.9% 1.4% 1.6% 14.9% 1.5% 13.4% 11.9% 12.1% 1.9% (0.2%) 0.5% (0.5%) (0.3%) (0.1%) 1 1 1 1 CET 1 DTA CET1 IFRS9 Operating Provisions Helix DTC CET 1 Helix CET 1 AT1 T2 Total Capital 31 Dec 2018 phasing in 31 Dec 2018 phasing in profitability and other 31 Mar 2019 31 Mar 2019 ratio 3 4 transitional impairments as reported pro forma for 31 Mar 2019 2 Helix pro forma for 2 Helix Continued reduction in RWA intensity Evolution of Capital Ratios Dec 2017 Dec 2018 Mar 2019 Mar 2019 CET1 2 pro forma for Helix 85% 85% 85% min 2019 SREP requirement 17.9% 16.2% 14.9% 14.9% 14.9% 73% 14.2% 13.4% 13.4% 12.7% 71% 12.2% 12.1% 11.9% 70% 64% 14.0 % 10.5% 10.5% Dec 14 Dec 15 Dec 16 Dec 17 Dec 18 Mar 19 Mar 19 1,4 1 CET 1 ratio CET 1 ratio transitional Total capital ratio pro forma 2 for Helix (1) Allowing for IFRS 9 transitional arrangements. The CET1 ratio for 31 March 2019, including the full impact of IFRS 9 amounts to 11.9% and 13.3% pro forma for Helix In March 2019, the Bank received approval from the ECB for the Significant Risk Transfer (‘SRT’) benefit from Helix. Helix remains subject to various outstanding conditions precedent (refer to slide 31). (2) All relevant figures and pro forma calculations are based on 31 March 2019 financial results, unless otherwise stated. Calculations on a pro forma basis assume completion of Helix, expected to occur in 2Q2019. The pro-forma ratios include any impact from the agreement for the sale of retail unsecured NPEs of € 33 mn GBV or € 5 mn NBV (known as Project Velocity) signed in December 2018 (3) Provisions and other impairments include the net change of the prudential charge s relating to specific credits and other items Transitional (phasing – in adjustments of DTAs) (4) 3
€ 10.4 bn or c.70% NPE reduction since peak 76% reduction of Net NPEs since peak (Dec 14) Group € bn Net NPEs ( € bn) LLR ( € bn) Gross NPE ratio UK sale in 3Q2018 reduced performing loans by € 1.8 bn; 63% 62% • Sixteen consecutive quarters of increased NPE ratio by 5 p.p 55% € 7.7 bn organic NPE reduction 60.0% 47% 47% 46% 50.0% • Agreement for sale of € 2.7 bn 15.0 14.0 35% NPEs (Helix) improves NPE 40.0% 11.0 ratio by 11 p.p. 1,2 8.8 30.0% 7.5 7.3 • NPE ratio at 35% post Helix 1,2 4.6 20.0% 9.9 8.5 10.0% 6.5 4.6 3.6 3.4 2.4 0.0% Dec Dec Dec Dec Dec Mar Mar 2019 1,2 2014 2015 2016 2017 2018 2019 pro forma for Helix Organic NPE reduction continued in 1Q2019 Cyprus operations € bn - € 0.15 bn - € 1.24 bn 0.77 (0.72) (0.98) (0.31) 0.13 0.10 (0.10) (0.12) (0.06) (2.70) 8.47 8.47 8.51 7.53 7.23 7.23 7.25 7.14 7.08 7.08 7.19 4.48 1,2 3 4,5 4,5 Dec Inflows Curing of Write-offs Foreclosures Dec Inflows Curing of Write-offs Foreclosures Mar Helix Helix Mar 2017 restructured 2018 restructured 2019 accounting 2019 loans and loans and related pro forma 1,2 collections collections impact in for Helix 6 1Q2019 In March 2019, the Bank received approval from the ECB for the Significant Risk Transfer (‘SRT’) benefit from Helix. Helix remains subject to various outstanding conditions precedent (refer to slide (1) 31). All relevant figures and pro forma calculations are based on 31 March 2019 financial results, unless otherwise stated. Calculations on a pro forma basis assume completion of the Transaction, expected to occur in 2Q2019. Includes any impact from the agreement for the sale of retail unsecured NPEs of € 33 mn GBV or € 5 mn NBV (known as Project Velocity) signed in December 2018 (2) Include a net impact of c. € 11 mn of IFRS 9 grossing up and set offs (3) (4) Includes consensual (debt for asset swaps, DFAs) and non consensual foreclosures and debt for equity swaps 4 (5) Value of on boarded assets is set at a conservative 25%-30% discount from open market valuations, by two independent sources (6) Reclassification between gross loans and expected credit losses on loans and advances to customers classified as held for sale
€ 281 mn NPE outflows in 1Q2019, leading to € 157 mn organic reduction on residual portfolio Outflows of NPEs on curing and exits ( € bn) Cyprus operations ( € bn) Curing of restructured loans DFAs & DFEs Write offs and non contractual write offs Other (Interest / Collections / Change in balances) 0.04 (0.05) (0.09) (0.10) (0.17) (0.10) (0.05) (0.06) (0.34) (0.13) (0.09) (0.12) (0.16) (0.05) (0.06) (0.28) (0.07) (0.32) (0.39) (0.37) (0.29) (0.01) (0.61) (0.71) 1Q2018 2Q2018 3Q2018 4Q2018 1Q2019 NPEs inflows ( € bn) Cyprus operations ( € bn) Redefaults New inflows Unlikely to pay Impacted by a reclassification of a Corporate Performing customer Group of € 150 mn 0.33 0.19 0.22 0.14 0.13 0.08 0.11 0.04 0.03 0.02 0.02 0.05 0.04 0.05 0.06 0.09 0.06 0.06 0.04 0.04 1Q2018 2Q2018 3Q2018 4Q2018 1Q2019 5
Recommend
More recommend
