Third quarter results 2001
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Third quarter results 2001. 12 November 2001. Mix of clients and products proves its value,. Revenues held up well despite weaker market conditions Operating result excluding contribution EAB and impact exchange rate, up by 2.3% Efficiency ratio stable at 73.9% from 73.8% in Q2. despite…….

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Third quarter results 2001

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Third quarter results 2001

Third quarter results 2001

12 November 2001


Mix of clients and products proves its value

Mix of clients and products proves its value,

  • Revenues held up well despite weaker market conditions

  • Operating result excluding contribution EAB and impact exchange rate, up by 2.3%

  • Efficiency ratio stable at 73.9% from 73.8% in Q2


Despite

despite…….

  • Increase in provisioning to EUR 308 mln, driven by one-off items in WCS portfolio

  • Increase in effective tax rate to 38% due to losses not tax deductible

  • Net profit was at EUR 476 mln, a decline of 29.1% from Q2


Wcs client coverage model further refined

WCS client coverage model further refined

  • To strengthen co-ordination between the client and product business units

  • To focus specialist sector resources on most significant client relationships

  • To reinforce country coverage capabilities to support greater focus on large cap corporate clients


Capital allocation and operating result

Capital allocation and operating result

Operating result

Capital Allocation


Higher provisioning

Q3 01

Q2 01

Q3 00

(EUR m)

- specific bad debt provisioning

- cross-border risks provisioning

Provisioning for loan losses

Addition to FAR

Total

295

13

308

-

308

262

(9)

253

-

253

154

0

154

-

154

Q3 01

Q2 01

Q3 00

(EUR m)

200

90

1

6

11

220

40

(1)

5

(11)

75

60

5

14

0

Higher provisioning

C&CC

WCS

PCA M

AALH

CC


Provisioning is within sustainable levels

Provisioning is within sustainable levels

RWA

BASIS

POINTS

EUR bn

39bp

35bp

40bp

26bp

23bp

Risk provisioning (2001: excl. changes in FAR)as a % of RWA (right hand scale)

* 2001 annualised


Tier 1 ratio affected by fx

Tier 1 ratio affected by FX

% change

30 09 01/

30 06 01

30 09 01/

31 12 00

(EUR bn)

30 09 01

30 06 01

Total assets

Shareholders’ equity

Group capital

Risk-weighted assets

Total capital ratio

Tier 1 ratio

597.7

11.1

32.7

274.1

10.10%

6.47%

614.6

11.6

34.7

286.1

10.19%

6.55%

(2.7)

(4.3)

(5.8)

(4.2)

10.0

(11.6)

0.5

3.9


Strong performance c cc reflects inherent strength

Strong performance C&CC reflects inherent strength

Revenues Q3 2001

% change

Interest (66%)

Commissions

(18%)

ytd 01/

ytd 00

Q3 01/

Q2 01

Q3 01

Q2 01

(EUR m)

Trading (3%)

(2.8)

(9.1)

(1.2)

(4.5)

818

220

598

166.4

5.0

143.3

(11.3)

Operating result

Provisioning

Pre-tax profit

RWA* (EUR bn)

795

200

591

158.9

Other (13%)

* RWA September 2001 compared to June 2001

  • Operating result excluding Q2 contribution of EAB, up by 8.3%

  • Strong performance of all three home markets (Netherlands, US and Brazil)

  • Overall quality of the portfolio remains strong, reflecting diversified client base.

  • Provisioning back to normal in Netherlands and stabilisation in US and Brazil


Restructuring within c cc on track

Restructuring within C&CC on track

  • Restructuring programme BU Netherlands on track

    • To date, 158 branches have been closed

    • Staff informed about option of voluntary retirement

      Staff should make decision before 15 January

  • Closure of countries and disposal of retail businesses

    • Sale of retail business in Argentina completed

    • Exit of nine countries completed

  • Integration of MNC and Standard Federal completed

    • Standard Federal completed its merger with MNC in October

    • Number of branches has decreased by 59


Increasing share of annuity business in wcs

Increasing share of annuity business in WCS

% change

Revenues Q3 2001

Commissions (34%)

ytd 01/

ytd 00

Q3 01/

Q2 01

Q3 01

Q2 01

(EUR m)

Trading (19%)

Operating result

Provisioning

Pre-tax profit

RWA* (EUR bn)

229

40

178

100.5

(20.1)

125.0

(52.2)

(4.3)

(43.5)

9.4

(61.7)

183

90

85

96.1

Other (6%)

Interest (41%)

* RWA September 2001 compared to June 2001

  • Mix of clients, products and geography proves its value

  • Measures are being taken to bring costs in line with revenue development

  • Provisioning has risen, but credit quality has overall been holding up well

  • Sharp increase in effective tax rate due to losses not tax deductible


Wcs cost target at most zero growth

WCS cost target - at most zero growth

  • Equity related business in the US

    • Focus research around key sectors

    • Reduction of trading personnel to reflect smaller stock footprint.

  • Equity related business in Asia

    • Closure of domestic Japanese equity business

    • Rationalisation of Asian (ex-Japan) equities operations

  • Corporate Finance

    • Refocus on key sectors


Wcs benefits from well diversified portfolio

WCS benefits from well diversified portfolio

Manufacturing

Services/Leisure

Telecom Services

11% (6%)

5% (6%)

8% (10%)

Media

Agriculture/Raw

4% (3%)

Materials

Technology

2% (2%)

7% (8%)

Construction/Real

Estate

6% (6%)

Oil & Gas

10% (9%)

Metals & Mining

3% (3%)

Utilities

Transport

10% (9%)

7% (7%)

Retail

Chemical

2% (2%)

5% (5%)

Consumer (Non)

Durables

Pharma/Health

Food etc.

Automotive

3% (3%)

3% (2%)

7% (10%)

7% (8%)

( ) December 2000


Revenues pcam affected by weak markets

Revenues PCAM affected by weak markets

% change

Revenues Q3 2001

Q3 01/

Q2 01

ytd 01/

ytd 00

Commissions (74%)

(EUR m)

Q3 01

Q2 01

Revenues

Operating result

Provisioning

Pre-tax profit

330

51

1

47

377

97

(1)

99

(12.5)

(47.4)

-

(52.5)

(3.8)

(43.4)

(80.0)

(42.7)

Trading (2%)

Other (3%)

Interest (21%)

  • Decline in revenues, due to depressed market conditions

  • Migration from equities to bonds and cash leads to lower margins

  • Fall of assets under management/administration due to weaker market values

  • We expect the coming year to be challenging


Third quarter results 2001

ANNEXES


Key figures profit and loss account

4,674

3,456

1,218

308

858

329

-

476

476

0.30

4,901

3,615

1,286

253

1,039

296

962

1,633

671

0.44

(4.6)

(4.4)

(5.3)

21.7

(17.4)

11.4

-

(70.9)

(29.1)

(31.8)

2.3

6.5

(7.8)

75.1

(21.9)

(15.3)

-

15.3

15.3

(25.6)

Key figures: profit and loss account

% change

Q3 01/

Q2 01

9 months 01/00

(EUR m)

Q3 01

Q2 01

Revenues

Operating expenses

Operating result

Provisioning for loan losses

Operating profit before tax

Taxes

Extraordinary result

Net profit

Net profit excl. sale EAB

EPS (x EUR)


Third quarter results 2001

Operating result excluding contribution EAB and impact exchange rate, up by 2.3%

Publisheddecrease

Impact ofEAB

Impact ofcurrencies

Organic growth (%)

(EUR m)

1.5

1.3

2.3

(14)

(168)

(106)

(62)

(17)

(134)

(99)

(35)

(19)

(227)

(159)

(68)

(181)

Revenues

Expenses

Operating result

Pre- tax profit


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