slide1 n.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
#1 Privately Owned Bank for Pensioners PowerPoint Presentation
Download Presentation
#1 Privately Owned Bank for Pensioners

Loading in 2 Seconds...

play fullscreen
1 / 29

#1 Privately Owned Bank for Pensioners - PowerPoint PPT Presentation


  • 167 Views
  • Uploaded on

#1 Privately Owned Bank for Pensioners. In any corner of Russia for people above 45 years old. Moscow. January 201 4. DISCLAIMER.

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about '#1 Privately Owned Bank for Pensioners' - emilie


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
slide1

#1 Privately Owned Bank for Pensioners

In any corner of Russia for people above 45 years old

Moscow

January 2014

slide2

DISCLAIMER

THE INFORMATION SET FORTH HEREIN has been PREPARED BY SOVCOMBANK (HEREINAFTER, “SCB” OR THE “BANK”) solely to provide limited information concerning the bank’s current operationsas described in this presentation. this information is intended for a general understanding of the bank’s business and development prospects and is not intended for justification for any decision.

neither the BANKnor its shareholders nor any associated affiliates shall have any liability or responsibility, whether express or implied, for the accuracy and completeness of this information or assume any obligations in relation to such information, its accuracy, reliability, completeness, or absence. specifically, without prejudice to anything contained below, no responsibility or liability shall be assumed with respect to the achievement or adequacy of any estimates, goals, or forecasts; nothing contained herein shall be interpreted as a promise or performance obligation for the future.

the publication hereof and any information related to the analysis of the BANKdoes not contain and shall not be interpreted as containing investment advice of theBANKor its shareholders.

neither the BANK nor its shareholders nor any associated affiliates shall be obligated to provide information users with access to any additional information or update this document or correct any inaccuracies that may become evident in the future. the BANKand its shareholders reserve the right to change any information at their own discretion.

this document does not contain any proposal to sell securities under any applicable law in any jurisdiction. neither the BANK nor its shareholders shall be liable with respect to any person distributing or owning this document in any jurisdiction.

СЭТЫ КАНЦЕЛЯРИИ

ДЛЯ СОТРУДНИКОВ

(white style)

sovcombank in a nutshell

SOVCOMBANK IN A NUTSHELL

In any corner of Russia for people above 45 years old

slide4

KEY FACTS ABOUT SOVCOMBANK

Client Base

Specialization

Market Positioning (1)

  • 1,066,000retail borrowers and over 161,000 retail depositors
  • 55% pensioners and people above 45 years old
  • Stable income, high payment discipline, strong demand and high growth, limited customer mobility
  • Unsecured consumer lending and retail deposits
  • Clients above 45 years old
  • Small territories and residential areas
  • #1privately owned bank by loan portfolio to pensioners
  • #2by ROAE among specialized consumer lenders (2)
  • #3by Net Income among specialized consumer lenders (2)
  • #26by consumer loan portfolio in Russia

Geographies

Management Team

  • Small and medium-sized towns and territories in regional markets with population below 100,000 inhabitants, under penetrated in terms of banking services and with low level of competition
  • 780 small townsin 38 regions across 8 time zones
  • The close proximity to our customers and their needs
  • Highly professional management team with proven track record of success in Russian banking sector
  • Clear development strategy with clear focus on high profitability, sustainable growth and financial delivery

Financial Performance

Efficiency

Risk management

  • Low-cost distribution network of a federal scale with centralized back-office functions
  • Strong operating level (79% of total costsare variable)
  • Scalable platform
  • Effective control of credit risk
  • Significant liquidity buffer in profitable low-risk fixed-income instruments
  • Well capitalized (CAR N1 = 13.5%)

(1) Source: IFRS reporting for 1H 2013 (2)Banks-specialists in consumer lending: Russian Standard Bank, Home Credit, The Orient Express, OTP Bank, Renaissance Credit, Asian-Pacific Bank, Tinkoff Credit Systems, Credit Europe Bank

slide5

KEY NUMBERS

Assets

Loans and Deposits

CAGR

bn rub

bn rub

Note: CAGR – Compound annual growth rate

Revenue = interestand fee and commission income

Equity

Net income

ROAA/ROAE

bn rub

bn rub

Source: IFRS reporting

*annual rate based on 9 months data

slide6

MARKET POSITIONING

Market positioning in banking sector

#7 by consumer loan portfolio (1)

#5by retail deposit portfolio (1)

2010

2011

2012

3Q 2013

bn rub

bn rub

6 months 2013

6 months 2013

#52

#59

#80

#76

Assets

#57

#71

#81

#79

Equity

Consumer loans

#26

#34

#27

#35

Retail deposits

#43

#37

#34

#32

Source: Interfax

#3by net income (1)

#2by return on equity (ROAE) (1)

#2 by Loans \ Deposits (1)

Consumer loans/Retail deposits

bn rub

6 months 2013

6 months 2013

6 months 2013

(1) – IFRS reporting, * - assessment on the basis of historical data under IFRS and RAS

BRC - Russian Standard Bank, HCF - Home Credit, VE - The Orient Express, OTP - OTP Bank, RC - Renaissance Credit, ATB - Asian-Pacific Bank, TCS - Tinkoff Credit Systems, CE – Credit Europe Bank

slide7

KEY DEVELOPMENT MILESTONES

  • Acquisition of the Bank by the current management team
  • Rebranding into inSovcombank
  • Retail license obtained
  • Acquisition of a stake in the Bank by Kardan group
  • Merger with ARKA (regional network of credit agencies)
  • Development of a consumer lending platform
  • Commercial launch of consumer lending
  • Expansion into 30 new regions via over 1,000 mini-offices
  • Enhancing credit risk management procedures and cost optimization
  • Development of investment business segment
  • Active growth and high profitability
  • Kardan group quit SCB
  • Rolling up corporate business segment
  • Rated by Moody's and S&P
  • Deeper penetration into smaller territories in regional markets
  • Targeting customers with higher IRR
  • Debt securities of SCB included into Lombard list of the Central Bank
  • Acquisition of GE Money Russia announced

Total assets of Sovcombank

bn rub

+27%

CAGR

+70%

CAGR

Source: IFRS reporting

slide8

BUSINESS STRATEGY

  • #1 PRIVATELY OWNED BANK FOR ACTIVE ADULTS AND THEIR PARENTS
  • #1 specialized privately owned Bank for active adult population and pensioners (older than 45)
  • Top-5 among privately owned specialized players in consumer loans and credit cards
  • Top-5 among privately owned specialized players by retail deposits
  • FEDERAL COVERAGE OF SMALL AND MEDIUM TOWNS AND RURAL TERRITORIES
  • Federal presence and deep penetration into local regional markets of small and medium towns and rural territories with population over 5,000 inhabitants
  • Located in close proximity to customers and their needs
  • Low-cost distribution and servicing model
  • STABLE GROWTH MANAGED TO MAINTAIN PROFITABILITY
  • Stable managed growth
  • ROAE above 30%
  • Further utilization of operating leverage and economy of scale to enhance operating efficiency (C/I < 40%)
  • Optimization of funding cost
  • FOCUS ON SUSTAINABILITY OF BUSINESS
  • Conservative credit, market and liquidity management policies
  • Liquidity cushion and solid capital position, partially employed in profitable and low-risk fixed income investments
  • Diversifying funding mix into public debt instruments while maintaining at least 50% share of retail deposits
  • Maintain ability to adapt for changes in demand and macro environment
  • Remain cautions on cost of risk
customers

CUSTOMERS

For people above 45 years old

slide10

UNIQUE CUSTOMER NICHE – active ADULTs

AND THEIR PARENTS

Stable demand

PENSIONERS AND ELDER PEOPLE ABOVE 45+

Stable income

  • The fastestgrowing segment of the population in Russia
  • Strong demand for banking services while supply is limited
  • Low income makes difficult the accumulation for significant purchases
  • Pensions
  • Stable salaries
  • Income from natural economy
  • Financial support from families

Population 45+ (mln people)

Percentage of population 45+

in the general population

Low competition

High payment discipline

  • Besides national banks and SCB there are no other players with a strong expertise in the segment
  • Unique brand, product know-how, high level of service help SCB to win customer trust and loyalty
  • Low risk appetite
  • High payment discipline
  • Low level of delinquency

Source: Rosstat data and forecasts, SCB estimates

slide11

#1 BANK FOR PEOPLE ABOVE 45

Brand

  • - Strong, well-established and well recognized brand among the target clientele
  • Long-term investments in marketing and unique advertising expertise

Service

  • Permanent analysis and change of processes according to demand of people above 45
  • Specialized training programs to serve pensioners

Products

  • Simple, understandable, affordable products
  • Affordable interest rates for pensioners and people older than 45 as a result of lower cost of risk

Proximity to customers

  • Wide regional distribution platform
  • Convenient locations in close proximity to customers
  • Social projects
slide12

SCB FOCUSES ON TARGET SEGMENT

Retail portfolio by segments

Operating profit by segments

Source: IFRS reporting

Source: IFRS reporting

markets and distribution

MARKETS AND DISTRIBUTION

In any corner of Russia

slide14

Nationwide REGIONAL FOOTPRINT

780 towns and territories in 38 Federal regions and 8 time zones

96% retail loans ...

Retail loan portfolio

Coverage of over 60% population

  • - SCB operations

x

  • - Number of offices

SbFD

UFD

CFD

NWFD

SFD

VFD

FEFD

14

... and 55% retail deposits inregional markets

KamchatkaKrai

Yaroslavl Obl

Vologda Obl

2

3

Moscow and

Retail deposit portfolio

29

Kostroma Obl

Moscow Obl

Sakha Rep

87

31

49

2

Vladimir Obl

3

3

Tula Obl

3

Krasnoyarsk Krai

Nizhny Novgorod Obl

Lipetsk Obl

20

Moscow

1

7

Sakhalin Obl

155

Ivanovo Obl

Khabarovsk Krai

Voronezh Obl

24

35

Samara Obl

66

Tyumen Obl

Tomsk Obl

Amur Obl

Chelyabinsk Obl

Krasnodar Krai

42

42

48

123

59

7

Irkutsk Obl

11

Omsk Obl

18

4

Rostov Obl

6

86

4

Bashkortostan

87

142

7

Adygea Rep

Buryatia Rep

Orenburg Obl

Kemerovo Obl

104

Primorsky Krai

Rep

4

Evreyskaya

165

Novosibirsk Obl

АО

Stavropol Krai

153

3

33

Zabaykalsky Krai

155

Khakassia Rep

Altai Krai

Regions

8

Altai Rep

Note: Sovcombank, data as of October 1, 2013; SbFD- The Siberian Federal District, CFD - Central Federal District, FEFD - Far Eastern Federal District, SFD - Southern Federal District, UFD - Urals Federal District, VFD - Volga Federal District, NWFD - North-West Federal District

Source: Sovcombank, data as of October 1, 2013

slide15

«LIGHT» COST-EFFICENT DISTRIBUTION NETWORK ALLOWSTO REACH OUT TO …

Expansion of distribution platform viacost-efficient mini-offices

«Light» distribution network

Offices

Mini-offices

Points of sale

Source: Sovcombank, data as of October 1, 2013

  • 1,319mini-offices
  • 395points of sale
  • 275offices
  • 1,148ATMs
  • 1,520 EFTPOS-terminals

Source: Sovcombank, data as of October 1, 2013

slide16

… DEFENSIVE REGIONAL MARKETS OF SMALL TOWNS AND RESIDENTIAL AREAS

Focus on small towns and territories

  • Low Competition

Retail customer base Sovcombank by towns of residence

0-100 thous. people

  • High margins

100-300 thous. people

300-700 thous. people

  • Low level of credit risk

>700 thous. people

Distribution network of Sovcombank towns of presence

  • The low mobility of population

0-100 thous. people

100-300 thous. people

  • Stable income

300-700 thous. people

>700 thous. people

  • Well protected againstpotential competitors

77% of SCB customers lives in towns with populations of below 300 '000 people

Source: Sovcombank, data as of October 1, 2013

slide17

BUSINESS EFFICIENCY INCREASES DUE TO ECONOMIES OF SCALE

Growing efficiency of distribution network

Increasing operating efficiency (Cost / Income)

Retail loans / Offices (mln RUR)

Source: Sovcombank

Source: Sovcombank

Strong operating leverage

OPEX/Offices

OPEX breakdown

mln RUR per annum

Source: Sovcombank

Source: Sovcombank

business

BUSINESS

Retail, Dynamic, Quality

slide19

QUALITY GROWTH OF RETAIL PORTFOLIO

Active growth of customer base

Quality growth of retail portfolio

19%

30%

10%

104%

69%

13%

30%

30%

'000customers

bn rub

*Sum of the number of customers by product is different from total number of customers because some customers have more than one product

Moderate growth in average loan balances

'000 rub

Source: Sovcombank

slide20

LOW DEBT-CAPACITY UTILIZATION OF SCB CLIENTS

Average contractual loan of SCB

Average monthly client payment for SCB loan

'000 rub

'000 rub per month

Source: Sovcombank, Ministry of Finance

slide21

QUALITY PORTFOLIO AND CONSERVATIVE

PROVISIONING POLICY

NPL 90+ \ Gross retail portfolio

Provisions \ NPL 90+

Source: IFRS reporting

Source: IFRS reporting

  • NPL 90+ is 100% provisioned
  • NPL 360+ is written-off
  • Conservative NPL provisioning policy
  • Total NPL 90+ coverage at 121%
funding and capital

FUNDING AND CAPITAL

Solid, Sustainable

slide23

FUNDING BASE

Funding structure

Average cost of funding

Debt instruments of SCB ...

Credit ratings

Ruble bonds

3 000 000 000 RUB

Ruble bonds

2 000 000 000 RUB

Рублёвые облигации

3 000 000 000 РУБ

11.25%

ПЛАНИРУЕТСЯ

PLANNED

18/06/201320/06/2016

... included in the Lombard list of the Central Bank

Source: Sovcombank, data as of October 1, 2013

Source: Sovcombank, data as of October 1, 2013

slide24

RETAIL DEPOSITS – KEY SOURCE OF FUNDING

Over 160,000 retail depositors and 67 bn rub outstanding deposit portfolio

An average deposit account is 370,000 rub

Over 80% SCB deposits are fully insured and SCB faces a low risk of sudden withdrawal of deposits

About 90% of portfolio in RUR to match lending currency mix

SCB effectively manages deposit inflows to match loan disbursements as a result of balancing of deposit rate and marketing activity

Term deposits are almost 100% of the portfolio

Retail deposits

Key source of funding

Depositors '000

141

160

65

92

113

bn rub

Note: The data on the amount indicated including current accounts, number of clients only on term deposits

Average cost of retail deposits

Over 80% of retail portfolio insured with DIA

<=1mln rub

>1 mln rub

Source: Sovcombank, data as of October 1, 2013

DIA – State Deposit Insurance Agency

slide25

SOLID CAPITAL BASE

Capital base

Capital adequacy (N1)

Well positioned amongspecialized consumer lenders

  • Positive dynamics of equity underRAS and IFRS
  • The high level of security of capital under RAS and IFRS
  • Capital adequacy N1 at the level of 13.5%, well above the minimum of 10%

Source: Sovcombank, Central Bank of Russia

Source: Central Bank of Russia

financial performance

FINANCIAL PERFORMANCE

Efficient, Dynamic

slide27

ATTRACTIVE FINANCIAL PERFORMANCE

Revenue* (12 months)

Revenue* (9 months)

+42%

+40%

+59%

+37%

Net income (12 months)

Net income (9 months)

+6%

+8%

+109%

+4%

Source: IFRS reporting

*Revenue= interestand fee and commission income

slide28

KEY FINANCIAL HIGHLIGHTS

* Annual rate based on 9 months data

Source: IFRS reporting

** Net margin = (net interest and fee income) / earning assets

contact information

CONTACT INFORMATION

E-mail: aosnos@sovcombank.ru

Andrei Osnos, CFO

Internet:http://www.sovcombank.ru/about/