MEDIOBA BANCA NCA POSI SITI TIVE VE START RT TO O FY19 19/20 /20 1Q20/ 0/3M 3M RESULTS TS AS AT 30 SEPTEMBE MBER R 2019 Milan, 24 October 2019
AGENDA NDA Section 1. Group results as at September 2019 Section 2. Closing remarks Annexes 1. Quarterly segmental reporting tables 2. Asset quality details by segment 3. Glossary
POSITIV TIVE E START ART TO FY19/20: 9/20: NET PROFIT IT UP 10%, %, ROTE>1 E>10% 0% SUSTAI AINAB ABIL ILIT ITY Y AND DISTIN INCT CTIV IVENES ENESS OF MB ACCRETI ETIVE VE VALUE UE CYCLE E CONFIRMED IRMED ONCE AGAIN IN MB continues on its growth roadmap, leveraging on the effectiveness of its diversified business model with focus on high-margin, specialized, growing businesses whose growth is driven by long-standing trends, with one of the lowest risk/high return profiles in Europe Sustainability and distinctiveness of MB accretive value cycle confirmed in 1Q FY 2019-20 Growth in revenue-generating assets, TFAs up 5% YoY to € 68bn (up 1% QoQ), with € 1.1bn of qualified NNM (AUM/AUA) in Affluent and PB segments in last 3M Loans up 6% YoY to € 45bn (up 1% QoQ) fostered by robust capital (CET1@14%¹) and strong business positioning delivered 7% growth in revenues (to € 684m, up 7% YoY and QoQ) NII and fees at € 514m, up 3% YoY and QoQ funding investment in people (headcount up 3% YoY, to 4,840 employees), innovation and distribution, keeping operational gearing and asset quality at among the best levels in Europe Banking² C/I ratio ~50% - CoR at 58bps – Gross NPLs/Ls ~4% Net profit up 10% YoY to € 271m (up 37% QoQ³) Banking activities and Group delivered ROTE adj. 4 >10% 1) Managerial calculation as at Sept19 differs from that stated in the Common Reporting (COREP), as it includes the result for the period (not subject to authorization pursuant to Article 26 CRR), which accounts for approx. 35bps of CET1; CET1 fully loaded @13% (with DC and IFRS9 fully phased). 3 2) Banking business defined as Group activities excluding Ass.Generali contribution 3) Including gains earned by Ass.Generali on Generali Leben disposal 4) Excluding non-recurring items, also those reported by Ass.Generali as indicated in Note 3.
PROGRES RESS S IN ALL DIVISION ONS 3M results as at September 2019 Section 1 WM: enhancement of awareness and positioning reflected in sound NNM and AUM/AUA growth Affluent: at the top level of asset gatherer sector by NNM. Growth in TFAs, with improving mix, revenue & profit With NNM at € 0.5bn in AUM/AUA in last 3M, CheBanca! consolidates previous quarter NNM level and doubles YoY, over performing competitors (in last 3M negative YoY NNM trend for major asset gatherers) TFAs growing and improving in mix: TFAs at € 25.8bn, up 12% YoY (up 2% QoQ), with AUM/AUA at 43% (vs 37% Sept18) Distribution empowered: FAs up to 365 (up 9% or 30 QoQ, up 50% or 121 YoY); RMs up to 451 (up 6 QoQ) Revenues up 7% YoY at € 77m (flat QoQ) , net profit up 35% YoY at € 8m (up 12% QoQ) UHNWIs: building a reference private investment bank. IB&PB: the business model ready to operate in a market with flattening asset growth, ever-decreasing margins and bar-belling of client portfolios. Distinctive and unique internal capabilities to offer a competitive PE/Alternatives proposition PB: robust NNM inflows with NNM@ € 0.7bn in last 3M, of which € 0.6bn in AUM/AUA Consumer Banking: confirmed as highly profitable/sustainable growing business Loans at € 13.4bn, up 7% YoY (and up 1% QoQ) with selected new business (up 11% to € 1.9bn) and margins resilient Revenues at € 267m, up 4% YoY (and QoQ), driven by NII up 5% YoY and QoQ Asset quality strong and resilient. CoR at 197bps, up 16bps YoY (and 4bps QoQ), with limited impact from growth of gross NPEs due to new definition of default¹ because of already high coverage levels in place Distribution empowered: 5 agencies opened in the quarter (to 204 total direct branches) 4 1) More details at slide number 10
PROGRES RESS S IN ALL DIVISION ONS 3M results as at September 2019 Section 1 Larger CIB: M&A and strong positioning strategic to offset ongoing pressure in European CIB segment Sound client business in the quarter, lower prop trading NII stable QoQ and YoY, at € 69m, despite ongoing pressure on large corporate spread due to disciplined growth in loans (up 2% YoY to € 17.6bn) driven by strong positioning and risk assessment Fees flat YoY and up 8% QoQ (at € 57m) despite low investment banking /capital market activities in the summer quarter due to larger proportion of advisory/capital-light fees coming from newly-consolidated Messier Maris Asset quality confirmed strong: no impact from new definition of default, writebacks continue though more limited PI: contribution again positive, investment profitable Contribution of equity-accounted companies positive once again (Ass.Generali stake @12.92%) AG value growing: NAV up 19% to € 3.6bn, BV at € 3.5bn, up 14% YoY and 9% QoQ Contribution to earning at € 136m, up 38% YoY due to € 45m in extraordinary gains from disposal reported by AG HF: distinctive funding mix and CoF/gearing control make us different NII flat despite even more negative rates due to distinctive funding mix (35% bonds, to be progressively repriced at lower spread) and active control of CoF Central costs flat at € 26m, despite fast-growing Group scope and size due to cost control Gop risk adj. up from - € 48m to - € 46m 5
INCREAS ASE IN REVENUE UE-GENERAT RATING ING ASSETS S & DIVERSIF RSIFICATION ICATION DELIVE VERE RED D STEADY DY REVENUES UES GROWTH OWTH Steady loan book … … and robust TFAs growth … …generated steady increase in revenues ( € bn ) ( € bn) ( € m, 3m) 3YCAGR : +9% 3YCAGR : +7% 3YCAGR : +11% +7% +6% +5% 684 638 45,0 598 137 68 99 530 1.9 65 91 36,8 2.0 78 2.2 57 150 2.4 159 17.6 153 17.2 50 150 14.9 14.7 140 136 122 91 12.1 10.5 9.7 8.6 267 257 246 236 13.4 12.6 11.9 11.1 Sept 16 Sept 17 Sept 18 Sept 19 Sept 16 Sept 17 Sept 18 Sept 19 Sept 16 Sept 17 Sept 18 Sept 19 Consumer WM CIB HF& other Consumer WM CIB PI HF& other Asset generating revenues steadily up in last 3Y: loan book up 6%YoY (+7% 3YCAGR); TFAs up 5%YoY (+11% 3YCAGR) Robust growth in revenues (up to € 0.7bn, 3YCAGR +9%, up 7% YoY) driven by business diversification (Consumer and WM growing steadily, CIB resilient, AG contributing soundly (1Q FY 2020 growth due to extra gains on disposals) 6
UNBROKE ROKEN N GROWTH OWTH IN NII DESP SPITE TE NEGATIVE TIVE RATE DUE E TO DISTINCTIVE TINCTIVE BUSIN INESS S AND FUNDIN NDING G MIX IX 3M results as at September 2019 Section 1 NII by division ( € m, 3m) Loans by division ( € bn) Consumer Banking Mortgages 359 +7% +16% FY19 avg: 349 FY18 avg: 340 349 344 332 69 9.5 70 13.4 69 66 68 13.2 12.6 66 9.0 69 67 64 8.2 69 64 66 66 64 66 63 63 64 Sept18 June19 Sept19 Sept18 June19 Sept19 235 227 223 224 224 218 218 218 214 Funding stock breakdown & MB securities issuances & redemptions (Sept19, € bn, CoF bps vs Euribor3M) Avg.cost expiring 52.6 90 135 160 100 bonds 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 6.4 Avg.cost 90 4.3 issued bonds Consumer WM HF & Other CIB 19.3 3.1 2.6 2.6 NII at € 359m, up 3% QoQ and 4% YoY , as result of 1.8 1.1 Diversified and growing loan book ( € 45bn, up 6% YoY 22.6 and 1% QoQ), fostered by all divisions, especially Consumer and Mortgages Sept19 Sept19- 12M 12M Distinctive funding structure : CoF manageable as bond June20 June21 June22 Sept19 portion progressively to be repriced at lower spread as MB bond issuances well as tied deposits in WM WM deposits MB bonds MB bond redemptions ECB Other 7
HIGHE GHER R K-LIG LIGHT HT FEE EES (WM WM & ADVISO ISORY) RY) OFF FFSET T SUBDUE BDUED D CAPMKT PMKT AND COSTS TS TO ENHANCE CE DISTRIBUTION TRIBUTION NETWORK ORK 3M results as at September 2019 Section 1 Group fees by quarter ( € m, 3m) CIB fees by product ( € m) 57 Lending 57 53 9 12 10 FY18 avg: 155 9 Specialty fin 155 FY19 avg: 153 12 10 11 10 14 155 Capmkt (2) 150 31 138 24 20 63 Advisory 75 66 57 57 53 63 52 1Q19 4Q19 1Q20 53 WM fees by source ( € m) 70 70 71 Other 73 70 71 71 70 1 69 2 66 64 1 56 Performance fees 75 74 69 Management+ 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 Banking+Advisory (6) (8) (8) Passive fees¹ WM Consumer CIB 1Q19 4Q19 1Q20 Fees stable YoY and up 3% QoQ , with: High quality of WM fees (upfront and performance fee represent just 10% of revenue stream, 90% recurring fees). WM fees reflect cost of fast-growing FAs network (fees payable) and customer risk aversion Advisory in CIB leveraged by MMA partnership 1) Including custodian fees as well as FAs payout and acquisition costs 8 2) CapMkt including ECM, DCM, sales
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