An introduction to the UBI Banca Group - September 2016
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An introduction to the UBI Banca Group September 2016
Disclaimer This document has been prepared by solicitation, offer, invitation or Group, please refer to publicly available Unione di Banche Italiane Spa (“UBI”) for recommendation to purchase, subscribe or information, including Annual, Quarterly informational purposes only. sell for any investment instruments, to and Interim Reports. It is not permitted to publish, transmit or effect any transaction, or to conclude any By receiving this document you agree to be otherwise reproduce this document, in legal act of any kind whatsoever. bound by the foregoing limitations. whole or in part, in any format, to any third This document may contain statements party without the express written consent that are forward-looking: such statements Please be informed that some of the of UBI and it is not permitted to alter, are based upon the current beliefs and managers of UBI involved in the drawing manipulate, obscure or take out of context expectations of UBI and are subject to up and in the presentation of data any information set out in the document. significant risks and uncertainties. These contained in this document either The information, opinions, estimates and risks and uncertainties, many of which are participated in a stock option plan and were forecasts contained herein have not been outside the control of UBI, could cause the therefore assigned stock of the company or independently verified and are subject to results of UBI to differ materially from those possess stock of the bank otherwise change without notice. set forth in such forward looking acquired. The disclosure relating to They have been obtained from, or are statements. shareholdings of top management is based upon, sources we believe to be available in the half year and the annual reliable but UBI makes no representation Under no circumstances will UBI or its reports. (either expressed or implied) or warranty affiliates, representatives, directors, on their completeness, timeliness or officers and employees have any liability accuracy. whatsoever (in negligence or otherwise) for Nothing contained in this document or any loss or damage howsoever arising expressed during the presentation from any use of this document or its Methodology constitutes financial, legal, tax or other contents or otherwise arising in connection All data are as at 30th June 2016 unless advice, nor should any investment or any with the document or the above mentioned otherwise stated. other decision be solely based on this presentation. document. This document does not constitute a For further information about the UBI Page 2
Agenda
The UBI Banca Group
Background
UBI Banca and its Peers
UBI Banca’s profile in a snapshot
Key figures as at 30th June 2016
The Group Structure
Presence in Italy
The UBI Banca International Network
Contacts
Annexes
Page 3Background
Unione di Banche Italiane Spa (“UBI Banca”) was formed following the merger of the skills and experience of
the BPU Banca and Banca Lombarda e Piemontese Groups (1st April 2007)
The history of UBI Banca is marked by a succession of mergers which have led banks with strong roots in local
communities to the significant reality of today
Birth of the
“Banca Mutua Birth of the
Popolare della “Società per la Birth of the “BPU
Città e Stagionatura e Banca Group”
Acquisition of from the 1st April 2007
Provincia di l’Assaggio delle “Banca Acquisition integration of Birth of 12 October 14 October
Bergamo” , Sete ed Affini” Popolare di of “Banca BPB-CV and BPCI “UBI Banca” 2015 2016
subsequently subsequently Merger of BPB Ancona” (BPA) Carime” by 2003 following the UBI is the first UBI EGM will
renamed renamed and “Credito by BPB-CV. BPCI merger of the popolare bank decide on the
“Banca “Banca Varesino” Birth of the 2001 BPU Banca to become a transition from
Popolare di Popolare (BPB-CV) BPB-CV Group
Bergamo” Commercio e 1992 Group and the Joint Stock the federal
1996 Banca
(BPB) Industria” 2000 Company model to the
1869 (BPCI) 1888 Lombarda e Single Bank
Acquisition of
Piemontese
1998 “Banca
Group
Merger of CAB and Regionale
BSPB with the Europea”* by
creation of “Banca Banca
1992
Lombarda” as Lombarda. The
1883 1888 1963 CAB acquires
parent company and Group takes the
Birth of the Birth of the BSPB acquires “Banco di San
contribution of name of “Banca
“Credito “Banca San “Banca di Giorgio” (BSG)
branch network of Lombarda e
Agrario Paolo di Valle
CAB and BSPB to Piemontese
Bresciano” Brescia” Camonica”
“Banco di Brescia”0 Group”
(CAB) (BSPB) (BVC)
* Banca Regionale Europea was created in 1994 following the merger between “Cassa di Risparmio di Cuneo” and “Banca del
Page 4 Monte di Lombardia”Background
Since 4th November 2014 UBI Banca is under the ECB’s Single Supervisory Mechanism.
UBI Banca is a joint stock company as from the 12th of October 2015. The transformation from co-operative was approved by a
general meeting of the shareholders on 10th October 2015, after a recent Law dated March 2015 established that cooperative banks
with total assets above 8€ bln must transform into Joint Stock Companies.
UBI Banca is listed on the Milan Stock Exchange and included , among others, in the FTSE/MIB and in the FTSE4Good indexes.
UBI Banca’s governance model is based on a “dualistic” system. Under this dualistic governance system, the shareholders appoint a
Supervisory Board (strategy and supervision). The current Supervisory Board was appointed on 2nd April 2016 by the General Meeting
of Shareolders of UBI Banca (15 members; former 23) for the 3-year period 2016-18.
The Supervisory Board, in turn, appoints a Management Board (day-by-day management of the bank), currently composed by 7
members (former 9 members).
34.3
#3
14.4
Market Capitalisation* as at 2nd September
2.2
2016 (EUR bln) 1.9
Source: “Il Sole 24Ore” – Italian Financial Newspaper – 1.7 1.7
Dated 3rd September 2016 0.7
* Total shareholders (voting and non voting) number around 155,000
Page 5UBI Banca and its Peers
No. of branches as at 30th June 2016 Total assets as at 30th June 2016 (€ bln)
6,606 891
5,242
717
2,048 #5
1,733
1,537
164 #5
1,176
655 124 117
62 50
Customer loans as at 30th June 2016 (€ bln) Total direct funding as at 30th June 2016 (€ bln)
596
489
387
360
#4 #4
108 112
88
84 79 83
44 35 46
37
Page 6 Source: Press releases and periodic reportsUBI Banca’s profile in a snapshot:
predominant retail business, solid capital base and low risk profile
3rd Italian commercial banking Group by market capitalization
Strong EUR 83.9 bn customer lending and EUR 87.5 bn direct funding (loan/deposit ratio: 95.9%)
competitive As at 30 June 2016, 81.2% of loans to customers were granted in Northern Italy, 10.6% in Central Italy
positioning and 8.2% in Southern Italy, while 74.1% of customer deposits came from Northern Italy, 11.2% from
Central Italy and 14.7% from Southern Italy
Capital ratios as at 30th June 2016:
CET 1 ratio phased in: 11.43% vs. 9.25% SREP requirement disclosed in Nov ‘15
Solid Capital CET 1 ratio fully loaded under Basel 3 rules: 11.02% (11.62% at year-end 2015)
and Balance Leverage ratio under Basel 3 (tier one capital / (on- and off-balance-sheet assets)) is at 5.7% phased in,
Sheet Position 5.5% fully loaded
Sound Liquidity position: the Group already complies with the Net stable Funding Ratio and Liquidity
Coverage Ratio as per Basel 3 requirements
UBI Banca has the second lowest level of gross non-performing loans among the major Italian banks
(Deteriorated Loans/Total Gross Loans ratio of 14.9%)
Good Asset
Quality 76.4% of Performing Exposures is low risk (76.0% in March 2016)
Strong improvement in coverage up to 44.3% for NPEs and to 58.3% for Bad Loans (including write-offs),
respectively +667 bps and +584 bps vs Mar ‘16
Focus on traditional banking activities: Customer loans/total assets at 72%
Low Risk Profile Funding mainly from own customer base (approx. 80%); limited recourse to institutional markets
Financial assets/total assets: approx. 16%. Italian Govies represent 13.9% of total assets
Figures as at 30th June 2016 unless otherwise stated
Data referred to banking perimeter only.
Page 7Key figures as at June 2016
STRONG CAPITAL VOLUMES
Net of financing to the Cassa Compensazione e Garanzia*
11,43% 11,02% loans to customers to 83.1 bln/€ (83.5 bln/€ in Mar 2016),
Buffer 218 bps
9,25% (177 bps vs FL) due to an increase in performing exposures (+1.3% vs Mar ’16)
and a decrease in non-performing exposures (-12% vs Mar ’16)
Total assets under management, amounting to 50.1 bln/€,
(+3.7% vs Mar 2016)
CET 1 CET 1 SREP
phased in fully loaded requirement
Deposits and current accounts to 49.1 bln/€, up both
compared to Dec 2015 (+2.9%) and to Jun 2015 (+9.8%)
FINANCIAL ASSETS & LIQUIDITY ECONOMICS
MAIN INCOME STATEMENT ITEMS in 1H16 (€ mln)
Further downsizing of Italian Govies Portfolio: 16.2 bln/€
(-8.5% vs Mar 2016) within UBI’s diversification strategy Core revenue: NII + Net fees & commissions 1,433
Operative income 1,588
A very high proportion of the portfolio consists of HQLA Operating expenses (1,043)
(High Quality Liquid Assets), with govies accounting for
Net operating income 545
81.9% of net financial assets
Profit (loss) for the period before BP impact 48
Total eligible assets at 27 bln/€, 55% of current accounts Business Plan impacts (835)
and deposits, of which 12 bln/€ unencumbered Profit (loss) for the period after BP impact (787)
Dividend paid in May 2016 at 11 €/cent.
* Technical Lending The Group has always paid cash
Page 8
dividend throughout the crisisUBI Banca has the second lowest level of gross non-performing loans
among the major Italian banks
RATIO OF TOTAL GROSS DETERIORATED LOANS/TOTAL GROSS LOANS
As at 30 Jun 2016
34,9%
23,5% 23,3%
16,3% 15,7% 14,5%
14,9%
MPS BPER BP BPM ISP UBI Banca UCG
Page 9The Group Structure
UBI BANCA provides management, co-ordination, control and supply of centralized services to the network
banks (single IT System, centralised risk management, centralised finance and treasury, commercial
coordination, credit coordination, logistics, purchasing, on line banking, etc...)
NETWORK BANKS
MAIN PRODUCT COMPANIES
100.00%
347 branches
ASSET MANAGEMENT UBI Pramerica
100.00% (partnership with Prudential US)
287 branches
FACTORING UBI Factor
83.76% (1)
Northern 192 branches
Italy LEASING UBI Leasing
74.79% (2)
204+3* branches LIFE BANCASSURANCE Lombarda Vita (partnership with Cattolica)
Aviva Vita Spa
63 branches
98.70% Aviva Assicurazioni Vita Spa
Central 99.58%
202 branches
Italy Merger of the 7 network
Southern 99.99% banks into UBI Banca
211 branches
Italy announced in the 2019-20
Business Plan. The
** 21 branches, ~ 824 100.00% Extraordinary General
financial advisors
Meeting of the Parent is
Information updated as at 30th June 2016, unless otherwise stated
* indicates branches outside Italy convened on 14th Oct 2016
**Merger between IW Bank and UBI Private Investment completed on 25 May 2015
1) moreover, 16.24% of capital held by Fondazione Banca del Monte di Lombardia
Page 10 2) further 24.90% of Banca Regionale Europea capital held by Fondazione Cassa di Risparmio di Cuneo and the rest by minority shareholders
10Presence in Italy
Introduction to the UBI Banca Group:
Predominant Retail Business and Strong Northern Italian Franchise
UBI Banca Market Share*
1 9 in %
Contribution
Branches
Loans Current accounts
to GDP ** to Customers and deposits
1
749
27 Northern Italy 55.0% 6.0% 6.4% 5.0%
167 Lombardy 21.6% 12.9% 9.4% 8.4%
36 42
Piedmont 7.6% 6.9% 5.2% 4.7%
Liguria 2.8% 4.4% 6.8% 3.6%
78
7
Central Italy 22.0% 3.3% 2.7% 2.5%
18
Latium 11.5% 4.2% 3.0% 2.8%
16
105 Marches 2.5% 7.5% 8.9% 6.9%
6
Southern Italy 23.0% 7.1% 5.2% 5.8%
76 93
Campania 6.1% 5.3% 4.4% 3.9%
19
Apulia 4.4% 7.3% 4.8% 5.8%
1
Italy 100.0% 5.2% 5.3% 4.3%
80
* Market shares as at 31 December 2015
** Source: Istat (GDP in terms of value added). 2014 data
• 1,531 branches in Italy + 6 branches abroad (as at 30th June 2016)
• National market share of 5.2% in terms of branches (as at 31th March 2016)
• 2nd player by branches in Lombardy (which generates 21.6% of Italian GDP)
• 17,590 employees
• Approx. 3.6 million clients, mainly retail
Page 11Agenda
UBI Banca International Network
Presence in the world
Page 12Presence in the world
Munich
Luxembourg
UBI Banca International Krakow
• UBI Banca International**
Branch UBI Factor Branch Shanghai
• UBI Trustee SA
• UBI Management Co SA Zhong Ou Asset Management
Company Co. Ltd*
Antibes, Menton, Nice
Banca Regionale Europea
Branches
Madrid
UBI Banca International
Shanghai
Branch Representative Office
New York Hong Kong
Representative Office from Representative Office
January 2016
Mumbai
São Paulo Representative Office
Representative Office
Casablanca Dubai
Representative Office Vienna Moscow Representative Office
from February 2016 Business Consultant Representative Office from August 2015
* Joint-venture in which UBI Banca holds 35% of the total share.
** On 28th April 2016 UBI Banca signed a contract for the sale of 100% of the share capital of UBI Banca International S.A. to
Page 13
EFG International AG. The transaction is expected to be completed during the first half of 2017.Agenda
Contacts
UBI Banca Correspondent Banking
Representative Offices Contacts
Page 14UBI Banca Sergio Passoni
Head of Global Transaction and Operations
Isabella Moavero
Head of Correspondent Banking and Representative Offices
Raffaella Chilelli Marco Ligonzo
Strategic Planner Due Diligence Officer
raffaella.chilelli@ubibanca.it marco.ligonzo@ubibanca.it
Alistair Newell
Relationship Manager • Indian Subcontinent, China & Far East, Oceania
alistair.robert.newell@ubibanca.it Antonella Taiocchi
antonella.taiocchi@ubibanca.it
Ernst Rolf Hartmann
• North America, Central America, South America,
Relationship Manager
ernst.rolf.hartmann@ubibanca.it
Caribbean, Israel
Lorenzo Tassini Silvia Colosio
Relationship Manager • Turkey, Middle East, Africa silvia.colosio@ubibanca.it
lorenzo.tassini@ubibanca.it
Maria Lagonigro Elena Voronova
Relationship Manager • Europe & CIS Countries elena.voronova@ubibanca.it
maria.lagonigro@ubibanca.it
Marco Camozzi • Global Players – Responsible for relationships with Elisa Gasparini
Relationship Manager
marco.camozzi@ubibanca.it multi-regional banking groups & Special Projects elisa.gasparini@ubibanca.it
Correspondent Banking - correspondent.banking@ubibanca.it
Page 15Representative Offices Contacts
MUMBAI HONG KONG SHANGHAI
Ms Rajeshree Balsari Mr Andrea Croci Ms Lu Bo
mumbai@ubibanca.com hongkong@ubihk.com office@ubibanca.sh.cn
Tel. +91 22 22023601 Tel. +852 2878 7393 Tel +86 21 61675333
Fax +91 22 22023603 Fax +852 2878 7932 Fax +86 21 61675582
MOSCOW SAO PAULO VIENNA (Business Consult.)
Mr Ferdinando Pelazzo Mr Isidoro Guerrerio Ms Annick Stockert
moscow@ubibanca.com saopaulo@ubibanca.com annick.stockert@esterni.ubibanca.it
Tel. +7 495 725 4466 Tel. +55 11 3063 0454 Tel. +43 1 514 37 26
Fax +7 495 725 4465 Fax +55 11 3063 3785 Fax +43 1 514 37 60
DUBAI NEW YORK CASABLANCA
(from Aug 2015) (from Jan 2016) (from Feb 2016)
Mr Luigi Landoni Mr Andrea De Benedittis Mr Abdelkrim Sbihi
ubi-dubai@ubibanca.it ubi-newyork@ubibanca.it ubi-casablanca@ubibanca.it
Tel +971 4 3277289 Tel +1 646 871 7600 Tel +212 669 58 81 76
Fax +971 4 3277290 Fax +1 646 205 4006
Page 16Agenda
Annex
UBI Banca’s consolidated results as at 31st December 2015
UBI Banca’s consolidated results as at 30th June 2016
Other main Group Companies
Group BIC codes
Page 17The UBI Banca Group: consolidated results as at 31st December 2015
MAIN INCOME STATEMENT ITEMS % change
FY14 FY15 FY15 vs FY14
Figures in € mln
Net interest income 1,818 A 1,631 (10.3%)
Net commission income 1,227 1,300 6.0%
Net result from finance 200 291 45.6%
Profits of equity-accounted investees 37 35 (4.7%)
Other income items 128 114 (11.1%)
Operating income 3,410 3,371 (1.1%)
Staff costs (1,302) (1,295) (0.5%)
Other administrative expenses (635) B (727) 14.5%
FY15 profit net of non-recurring items: +33.2% YoY
Net impairment losses on property, equipment and investment
(171) (153) (10.7%)
property and intangible assets 195.1 mln/€ in FY15 vs. 146.5 mln/€ in FY14
Operating expenses (2,108) (2,175) 3.2%
Net operating income 1,301 1,196 (8.1%)
Net impairment losses on loans (929) (803) (13.6%)
Net impairment losses on other financial assets and liabilities (9) (17) 95.0%
Net provisions for risks and charges (9) (3) (67.2%)
Profits (losses) from disposal of equity investments 94 0 (99.5%)
Pre-tax profit from continuing operations 449 374 (16.8%)
Taxes on income for the period from continuing operations (187) (161) (13.8%)
Profits for the period attributable to non-controlling interests (29) (30) 2.9%
Impairment on tangible and intangible assets
(883) (3)
(net of tax and non-controlling interests)
Charges for exit incentives
(76) (63) (17.8%)
(net of tax and non-controlling interests)
Profit (loss) for the period (726) 117 n.s.
Profit for the period NET OF NON-RECURRING ITEMS 147 195 33.2%
PPA allocated line by line
A• Net interest income decreased primarily following a change in the composition and a reduction in the size of the securities portfolio (AFS Italian Govies).
Page 18 B• Operating expenses are inclusive of the ordinary (€ 33.4 mln) and extraordinary contributions (€ 65.3 mln) to the Resolution Fund and to the
Deposit Guarantee Scheme. On a like-for-like basis with respect to 2014, and that is excluding all the above contributions, costs fell further by
1.7% compared with 2014.The UBI Banca Group: consolidated results as at 30th June 2016
95% of 2019/20 Business Plan impacts already booked in 2Q16 (-835 mln/€ net)
% change % change % change
1H15 1H16 1H16 vs 2Q15 1Q16 2Q16 2Q16 vs 2Q16 vs
Figures in € mln 1H15 2Q15 1Q16
Net interest income 847 766 (9.6%) 417 388 378 (9.3%) (2.5%)
Net commission income 669 667 (0.2%) 328 337 330 0.7% (2.0%)
Net result from finance 111 83 (25.7%) 53 16 67 26.0% n.s.
Profits of equity-accounted investees 20 12 (38.9%) 13 5 7 (50.0%) 27.5%
Other income items 62 61 (1.9%) 32 27 34 5.1% 23.5%
Operating income 1.709 1.588 (7.1%) 843 773 815 (3.3%) 5.5%
Staff costs (655) (639) (2.4%) (320) (320) (319) (0.2%) (0.1%)
Other administrative expenses (313) (327) 4.6% (165) (172) (156) (5.8%) (9.5%)
Net impairment losses on property, equipment and
(78) (72) (7.8%) (39) (36) (36) (9.1%) (1.0%)
investment property and intangible assets
Operating expenses (1.046) (1.038) (0.7%) (524) (528) (511) (2.6%) (3.2%)
Net operating income 663 550 (17.1%) 319 245 305 (4.3%) 24.3%
2019/2020 Business Plan impact
Net impairment losses on loans (389) (355) (8.6%) (199) (155) (200) 0.6% 28.8%
Net impairment losses on other financial assets and
(3) (50) n.s. (2) 0 (51) n.s. n.s.
liabilities
Net provisions for risks and charges (29) (27) (8.5%) (25) (6) (20) (18.2%) n.s.
Profits (losses) from disposal of equity investments 0 2 n.s. 0 0 1 n.s. n.s.
Pre-tax profit from continuing operations 242 119 (50.7%) 93 84 35 (62.4%) (58.4%)
Taxes on income for the period from continuing
(99) (58) n.s. (37) (34) (23) (37.5%) (32.4%)
operations
Profits/losses for the period attributable to non-
(17) (14) n.s. (7) (7) (6) (15.0%) (15.5%)
controlling interests
Profit for the period before Business Plan impacts 126 48 (61.7%) 49 43 6 (88.5%) (86.9%)
Net impairment losses on loans with shortfall - (586) n.s. - - (586) n.s. n.s.
Charges for exit incentives (1) (208) n.s. - (0) (207) n.s. n.s.
Brands impairment - (38) n.s. - - (38) n.s. n.s.
Charges for Single Bank project - (3) n.s. - - (3) n.s. n.s.
Profit (loss) for the period 124 (787) n.s. 49 42 (829) n.s. n.s.
PPA allocated line by line
Page 19 *virtual elimination of residual credit risk connected with financial instruments resulting from non-performing loan positionsOther main Group Companies
Recent merger between IW Bank (market leader in online trading in Italy with a strategy
based on three fundamental objectives: continuous product/service innovation, constant
development of technological platforms, professional support for the customer) and UBI
Private Investment, the network of financial agents of the UBI Group
Asset Management – Joint Venture with Prudential US
● UBI Pramerica develops, manages, markets and distributes a wide range of financial
products and services dedicated to private customers and institutions. It has been
awarded various international prizes.
● 45.2 bln EUR in Assets Under Management
● UBI Leasing offers its clients financing for asset acquisition such as: instrumental
leasing, real estate leasing, car leasing, aero naval leasing as well as specific
insurance and accessory services.
● 6.5 bln EUR in net Loans to Customers
● UBI Factor offers highly specialized factoring services to companies and public
administrations. The company is based in Milan with a capillary structure across the
national territory and is present also in Poland with its Krakow subsidiary. Since 1984
UBI Factor is part of the Factors Chain International network which allows it to retain a
presence in more than 75 countries and with more than 270 foreign partners.
● 4.5 bln EUR Turnover; 2.3 bln EUR net Loans to Customers
Page 20 Data as at 30.06.2016 unless otherwise statedGroup BIC codes
BEPOIT21
BCABIT21
BREUITM1
BLOPIT22 POCIITM1
BPAMIT31
CARMIT31
BVCAIT21
BLPIIT21
* UBIBESMM Madrid Branch
CABILULL
BEPODEMM Munich Branch
BIC ACTIVE
BIC NON ACTIVE
* On 28th April 2016 UBI Banca signed a contract for the sale of 100% of the share capital of UBI Banca International S.A. to
Page 21 EFG International AG. The transaction is expected to be completed during the first half of 2017.You can also read
