ARGENTINA
BBVA Group
Third Quarter 2016
BBVA Group Third Quarter 2016 ARGENTINA Disclaimer This document - - PowerPoint PPT Presentation
BBVA Group Third Quarter 2016 ARGENTINA Disclaimer This document is only provided for information purposes and does not constitute, nor should it be interpreted as, an offer to sell or exchange or acquire, or an invitation for offers to buy
ARGENTINA
Third Quarter 2016
1
This document is only provided for information purposes and does not constitute, nor should it be interpreted as, an offer to sell or exchange or acquire, or an invitation for offers to buy securities issued by any of the aforementioned companies. Any decision to buy or invest in securities in relation to a specific issue must be made solely and exclusively on the basis of the information set out in the pertinent prospectus filed by the company in relation to such specific issue. No one who becomes aware of the information contained in this report should regard it as definitive, because it is subject to changes and modifications. This document contains or may contain forward looking statements (in the usual meaning and within the meaning of the US Private Securities Litigation Reform Act of 1995) regarding intentions, expectations or projections of BBVA or of its management on the date thereof, that refer to or incorporate various assumptions and projections, including projections about the future earnings of the
results or final decisions to differ from such intentions, projections or estimates. These factors include, without limitation, (1) the market situation, macroeconomic factors, regulatory, political or government guidelines, (2) domestic and international stock market movements, exchange rates and interest rates, (3) competitive pressures, (4) technological changes, (5) alterations in the financial situation, creditworthiness or solvency of our customers, debtors or counterparts. These factors could cause or result in actual events differing from the information and intentions stated, projected or forecast in this document or in other past or future documents. BBVA does not undertake to publicly revise the contents of this or any other document, either if the events are not as described herein, or if such events lead to changes in the information contained in this document. This document may contain summarized information or information that has not been audited, and its recipients are invited to consult the documentation and public information filed by BBVA with stock market supervisory bodies, in particular, the prospectuses and periodical information filed with the Spanish Securities Exchange Commission (CNMV) and the Annual Report on Form 20-F and information on Form 6-K that are filed with the US Securities and Exchange Commission. Distribution of this document in other jurisdictions may be prohibited, and recipients into whose possession this document comes shall be solely responsible for informing themselves about, and
URUGUAY-PARAGUAY
Journey
> BBVA’s global presence > History of BBVA > Main figures > BBVA share > Organizational chart > Our team > Presence in social media > Social commitment > Awards and recognitions
PERU
4
Journey
> BBVA’s global presence > History of BBVA > Main figures > BBVA share > Organizational chart > Our team > Presence in social media > Social commitment > Awards and recognitions
As of September 2016. It includes customer’s data as of August 2016.
North America
USA / Mexico
Europe
Germany / Belgium/ Spain/ France / Holland / Italy / Luxembourg / Malta / Portugal / U.K. / Romania / Russia / Switzerland / Turkey
Asia - Pacific
Australia / China / UAE / Hong Kong / India / Indonesia / Japan / South Korea/ Singapore / Taiwan
South America
Argentina / Bolivia / Brazil / Chile / Colombia / Paraguay / Peru / Uruguay / Venezuela
€ 725
billion in total assets
68
million customers
35
countries
8,761
branches
30,890
ATMs
136,244
employees
5
Journey
> BBVA’s global presence > History of BBVA > Main figures > BBVA share > Organizational chart > Our team > Presence in social media > Social commitment > Awards and recognitions
BBVA is the result of the merger of two major Spanish banking institutions
Bancaria de España
Hipotecario
6
Journey
> BBVA’s global presence > History of BBVA > Main figures > BBVA share > Organizational chart > Our team > Presence in social media > Social commitment > Awards and recognitions
BBVA had significant growth since 1995
1995
(Mexico)
1996
1997
1998
1999
2000
(Mexico)
2005
(USA)
Financieros (Chile)
(USA)
2006
2007
2008
2009 2010 • New extension CITIC
agreement
(Turkey)
2012
2013
2014
(China)
in Turkiye Garanti Bankasi (Turkey)
Atom (UK)
2015
(Chile)
2011
2004
2016
7
Journey
> BBVA’s global presence > History of BBVA > Main figures > BBVA share > Organizational chart > Our team > Presence in social media > Social commitment > Awards and recognitions
8,882
Operating income
2,797
Net attributable profit
Earnings (€m)
724,627
Total assets
55,891
Total equity
422,844
Loans and advances to customers - gross
Balance sheet (€m)
385,348
Deposits from customers
7.2%
ROE
0.67%
ROA
51.8%
Efficiency ratio
Efficiency / Profitability
5.1%
NPL ratio
72%
NPL coverage ratio
Risk management
12.26%
Phased-in
11.00%
Fully-loaded
Solvency – CET1 ratio
For more information click here
18,431
Gross income
8
Journey
> BBVA’s global presence > History of BBVA > Main figures > BBVA share > Organizational chart > Our team > Presence in social media > Social commitment > Awards and recognitions
Figures as of 30th September 2016
Number of shares issued (m) 6,480 Book value per share (€) 7.33 Closing price (€) 5.38 Market capitalization (€m) 34,877
Listed on the main international stock markets BBVA’s capital ownership is well diversified
Shareholder breakdown
47.8 52.2 2.7 6.7 2.7 35.7
Banks Institutions Employees Individuals Resident Non-resident
#shareholders
947,244
For more information click here
Weighting (30-09-2016)
IBEX 35 7.7% Euro Stoxx 50 1.7% Euro Stoxx Banks 9.9% Stoxx Europe 600 Banks 4.5%
Madrid New York Mexico London Peru
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Journey
Execution & Performance New Core Competencies Risk & Finance
Group Executive Chairman
Francisco González Strategy & Control
CEO
Carlos Torres Vila Corporate & Investment Banking
Juan Asúa
Country Monitoring1
Jorge Sáenz-Azcúnaga
Talent & Culture
Ricardo Forcano
Engineering
Ricardo Moreno
Finance
Jaime Sáenz de Tejada
Global Risk Management
Rafael Salinas
Global Economics Regulation & Public Affairs
José Manuel González-Páramo
Legal & Compliance
Eduardo Arbizu
Strategy & M&A
Javier Rodríguez Soler
Accounting & Supervisors
Ricardo Gómez Barredo
Communications
Paul G. Tobin
General Secretary
Domingo Armengol
Internal Audit
José Luis de los Santos
Customer Solutions2
Derek White
Mexico
Eduardo Osuna
USA
Manolo Sánchez
Spain
Cristina de Parias
Turkey
Fuat Erbil
> BBVA’s global presence > History of BBVA > Main figures > BBVA share > Organizational chart > Our team > Presence in social media > Social commitment > Awards and recognitions
Nota 1: Reporting channel to CEO for Argentina, Colombia, Chile, Peru, Venezuela, Uruguay and Paraguay, as well as monitoring of all countries, including Spain, Mexico, Turkey and USA. Nota 2: Integrates Global Marketing & Digital Sales; Business Development in Spain, Mexico, Turkey, USA and South America; Distribution model; Insurance and Prevision; Asset Management & Global Wealth; Consumer Finance and New Digital Businesses.
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Journey
> BBVA’s global presence > History of BBVA > Main figures > BBVA share > Organizational chart > Our team > Presence in social media > Social commitment > Awards and recognitions
We are creating the kind of culture, environment and ways
we do
The best team
Our people are the cornerstone of our transformation and helping BBVA deliver the best customer experience anywhere We are defining what it means to be an employee at BBVA, and what sets us apart from any
In 2015, we established
In 2016, we will focus
United States
10,590
Mexico
37,408
South America
30,698
Spain
32,341 Turkey 22,391
Rest of Eurasia
2,816
Age average: 37 years
46% 54%
BBVA Group:
136,244
employees
Note 1: Figures as of 30th of September 2016. Note 2: Criteria for number of employees is based on location.
A first class workforce
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Journey
> BBVA’s global presence > History of BBVA > Main figures > BBVA share > Organizational chart > Our team > Presence in social media > Social commitment > Awards and recognitions
Followers in social media
30,326,033
Facebook (fans)
25,024,096
Twitter (followers)
4,512,150
YouTube (subscribers)
84,799
Google+ (fans)
12,358
LinkedIn (subscribers)
372,707
Instagram (fans)
319,923
USA
9
Mexico
18
Venezuela
5
Colombia
6
Peru
11
Chile
12
Argentina
7
Paraguay
5
Uruguay
4
Spain
45
Number of BBVA’s social media profiles by country (as of September 2016)
Profiles
183
Note: As of September 2016.
BBVA’s commitment is to be where the people are, to listen and understand their needs and dreams. This is the reason that makes BBVA a forward-looking entity in social media
Whoever or wherever they may be, we have a solution and a tailored-channel for all
with BBVA
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Journey
> BBVA’s global presence > History of BBVA > Main figures > BBVA share > Organizational chart > Our team > Presence in social media > Social commitment > Awards and recognitions
For more information click here
Highly committed to the societies in which we
In 2015
1. 103.61 €m
Financial Literacy Social Entrepreneurship Knowledge
Premio Fronteras del Conocimiento
(1) BBVA´s annual budget.
13
Journey
> BBVA’s global presence > History of BBVA > Main figures > BBVA share > Organizational chart > Our team > Presence in social media > Social commitment > Awards and recognitions
Once more, BBVA’s differentiated management has been recognized
The best place to work in Spain
The best bank
for Euromoney
Journey
> Vision of the financial industry > Our aspiration
COLOMBIA
15
Journey
> Vision of the financial industry > Our aspiration
(1) Source: BBVA; Banks in peer group: Santander, Deutsche, Commerzbank, BNPP, SocGen, CASA, Intesa, Unicredit, HSBC, Barclays, Royal Bank of Scotland, Lloyds, UBS y Credit Suisse, Citigroup, Bank of America, JP Morgan y Wells Fargo. (2) Juniper Research Future Proofing Digital Banking. 0.1 0.2 0.4 0.6 0.8 1.0
2010 2011 2012 2013 2014 2015
x 10 in 5 years
Regulatory pressure and the impact in profitability Mobile has changed the distribution model New players are entering the value chain
15.8%
5.6% 7.0% 2.7% 1.5% 1.7% 4.0% 4.4%
2007 2008 2009 2010 2011 2012 2013 2014 2015
Banks ROE Evolution1 (%) World mobile banking users2
16
Journey
Permanently connected
Banking anytime, anywhere
Interaction with multiple devices and applications
Seeking the best experiences for each of their banking needs
Used to digital experiences
Expect proactive and personalized help in their finance management
> Vision of the financial industry > Our aspiration
17
Journey
Better experience More efficiency
Big Data Blockchain Cloud Data processing Artificial intelligence Biometrics
The client will be the main beneficiary in this new environment as financial services become democratized
> Vision of the financial industry > Our aspiration
18
Journey
> Vision of the financial industry > Our aspiration
Strengthening the relationship with the customer
Redefining our Value Proposition to focus
Helping customers to make the best financial decision Providing the best solutions to cover all their financial needs Through an “engaging” experience: simple, clear, effortless and with high degree of automatization
Journey
> Our purpose > Strategic priorities > Progressing in
VENEZUELA
20
Journey
Having a true impact on people’s lives and businesses Aligned with our vision of the future Helping customers to achieve their life goals Be more than a bank, be an engine
> Our purpose > Strategic priorities > Progressing in
21
Journey
> Our purpose > Strategic priorities > Progressing in
To help us in this journey, we have defined six strategic priorities at a Group level
New standard in customer experience Drive digital sales New business models Optimize capital allocation Unrivaled efficiency A first class workforce
22
Journey
> Our purpose > Strategic priorities > Progressing in
A business model with the customer at the core that offers a differential service with a very ambitious goal
Peer Group: Spain: Santander,CaixaBank, Bankia, Sabadell, Popular, ING, Bankinter/ USA: Bank of America, Bank of the West, Comerica, Frost, Chase, Suntrust, Regions, US Bank, Wells Fargo, PNC, BB&T // Mexico: Banamex, Santander, Banorte , HSBC// Peru: BCP, Interbank, Scotiabank// Argentina: Banco Galicia, HSBC, Santander Rio// Colombia: Bancolombia, Davivienda, Banco de Bogotá// Chile: BCI, Banco de Chile, Santander // Venezuela: Banesco, Mercantil, Banco de Venezuela. Peru: Data as of December 2015.
To be leaders in customer satisfaction across our global footprint
NPS (Net Promoter Score) – Jun16
BBVA - Peers Average
1st 6th 1st 1st 2nd 1st 1st 3rd
9% 45% 43% 23% 24% 31% 18% 58% 12% 47% 34% 28% 21% 33% 22% 68%
23
Journey
> Our purpose > Strategic priorities > Progressing in
7.8 11.0
Sep.15 Sep.16
Branch activity
(Million of transactions)
BBVA Spain
Digital customers*
(Million) – BBVA Group
14.2 17.2
Sep.15 Sep.16
+20%
Mobile customers*
(Million) – BBVA Group +41% 51 46 42 39
2013 2014 2015 Sep.16
We are improving
to respond to the customers’ multichannel profile
(*) Spain, Turkey, Argentina, Chile, Colombia, Venezuela, Paraguay and Uruguay data as of August 2016. Peru data as of July 2016.
24
Journey
> Our purpose > Strategic priorities > Progressing in
Digital product plan
Traditional product digitalization:
mortgages, car insurances, receipt finance, one-click loans...
% of total sales YtD, # of transactions Native product launches:
Wallet, Link, Wibe...
Driving sales through digital channels
We are promoting the development of digital products and services, for customers most convenient channel selection
Spain Mexico South America*
8.8 14.7
Dec.15 Sep. 16
7.3 15.4
Dec.15 Sep. 16
(*) Uruguay’s September data not updated (August figures considered)
9.0 15.0
Dec.15 Sep. 16
USA
9.3 19.5
Dec.15 Sep. 16
Turkey
23.4 25.2
Dec.15 Sep. 16
25
Journey
> Our purpose > Strategic priorities > Progressing in
Leveraging the fintech ecosystem to develop our value proposition
Internal Incubation Strategic partnerships Acquisitions Investments (venture capital)*
29.5% stakeAPI Client
BBVA Open API’s
3rd party API
API Client API Client
3rd party API
Enable new developments combining BBVA’s APIs, client’s technology and other building blocks
Open Platform
BBVA is driving the modularization of finance
www.bbvaapimarket.com
(*) DriveMotors, Civi, Hippo, Guideline, Brave and Hixme are investments made by Propel Venture Partners US Fund I, LP, fintech venture capital fund managed independently by Propel Venture Partners LLC, where BBVA Compass Bancshares Inc. is a Limited Partner.
26
Journey
> Our purpose > Strategic priorities > Progressing in
In 2007 we began our transformation process
We have been working
And we are adapting to the new paradigms of development
Placing technology at the customer’s service
Front-Office / Channels
Multichannel Architecture
branch mobile web social network ATMs call center BBVA Wallet
Middleware / Services Back-office or core banking System
Platform as a Service
27
Journey
> Our purpose > Strategic priorities > Progressing in
We are transforming the organization internally by fostering a new culture
New ways of working: Agile, collaborative tools Collaborative culture, entrepreneurship (‘trial - error’) Zero tolerance against low quality New headquarters Leaner structures
28
Journey
> Our purpose > Strategic priorities > Progressing in
At BBVA, we are accelerating our transformation process to become the best bank for our customers
> Highlights > Business areas
Journey
3Q16
CHILE
30
Journey
3Q16
+12.7%
Gross income Operating income
Ongoing cost control efforts & efficiency improvement
Cost of risk and loan-loss provisions + RE impairments
Cost of risk improvement
3Q16
+3.6%
constant € constant € 3Q16
Cost of risk YTD
Net attributable profit
Loan-loss provisions + RE impairments
3Q16
NPL ratio
5.1%
Coverage ratio
72%
Leverage ratio
6.6%
Fully-loaded
CET1 ratio
11.00%
Fully-loaded
12.26 %
Phased-in
Risks
Risk indicators improvement
Capital
Solid capital ratios
> Highlights > Business areas
Strong quarterly results, earnings resilience Additional restructuring charges to gain efficiency offset by higher NTI
9M16
+5.1% +16.2%
constant €
+23.3% +11.5%
2,982 €m
+17.7% +4.4% vs. 9M15
8,882 €m
9M16 constant €
3Q16
n.s. n.s.
constant €
+64.3% n.s.
+15.0%
Ex corporate
+23.1% +37.4%
Ex corporate
9M16
constant € constant € constant €
31
Journey
3Q16
> Highlights > Business areas
BBVA Group (€m) 9M16 Change 9M16/9M15 % % constant Net Interest Income 12,674 5.5 18.1 Net Fees and Commissions 3,557 3.3 12.5 Net Trading Income 1,753 12.5 24.3 Other Income & Expenses 446
Gross Income 18,431 5.1 16.2 Operating Expenses
5.8 14.8 Operating Income 8,882 4.4 17.7 Impairment on Financial Assets
3.7 Provisions and Other Gains
Income Before Tax 5,107 17.8 38.2 NI ex Corporate Operations 3,722 15.4 33.2 Corporate Operations Income n.s. n.s. Non-controlling Interest
n.s. n.s. Net Attributable Profit 2,797 64.3 n.s. Net Attributable Profit (ex corporate operations) 2,797
15.0
32
Journey
3Q16
Net attributable profit
€ m
NPL ratio
5.9%
Coverage ratio
Spain Banking activity
58%
NII impacted by lower activity and lower ALCO contribution Negative trend in fees and commissions CX merger successfully completed in Sep.: 200 €m cost synergies Significant decrease in loan-loss provisions
Spain Real estate activity
Net attributable profit
m
USA constant €
Net attributable profit
€ m
NPL ratio
1.7%
Coverage ratio
87%
Net exposure
%
> Highlights > Business areas
Positive market trends Lower P&L negative impact Ongoing exposure reduction NII growth due to improvement in customer spread Fee revenue increase in the quarter due to CIB Management focus on cost control Loan-loss provisions positive evolution
33
Journey
3Q16
> Highlights > Business areas
Net attributable profit (1)
m
+45.7% vs. 9M15
NPL ratio
2.9%
Coverage ratio
Turkey constant €
125%
South America constant €
Activity towards more sustainable levels Double digit revenue growth Exposure to hyperinflationary economies
Net attributable profit
€ m
+2.2% vs. 9M15
NPL ratio
2.8%
Coverage ratio
110%
Net attributable profit
m
+11.4% vs. 9M15
NPL ratio
2.5%
Coverage ratio
Mexico constant €
122%
(1) Considering the additional stake in Garanti accounted for using the full consolidation method from 01/01/15 vs. 01/07/15 deal closing.
NII growth due to price management and activity Solid revenue growth Cost growth below inflation Sound asset quality indicators Double digit activity growth despite certain slowdown Top-line double digit growth translated into net profit Good year in fees supported by credit cards and cash management Positive jaws
34
Journey
3Q16
Corporate & Investment Banking
Fall in customer funds, especially in Europe, due to prices management High recurrence of our client’s revenues Deterioration of the environment causes a drop in results in line with the industry
(1) Client’s revenue / Gross margin.
Business activity Client’s revenue Results
(constant €, % YoY) (constant €, % YoY)
Lending (net)
Customer funds
Gross margin
Net margin
Net attributable profit
Wholesale banking recurrent business1
% of revenues given by
clients
(constant €, % YTD)
> Highlights > Business areas
ARGENTINA
Third Quarter 2016