Post on 24-May-2015
description
TBC Bank Recent Financial performance
H1 2011
• Georgian Banking Sector
• TBC Bank at a Glance
• Business lines
• Strategy and Forecast
• Financials
• Capital
Contents
2
13.8 17.0
19.1
18.0
20.8 23.6
26.4
9.4%
12.3%
2.4%
-3.8%
6.4%
5.5%
5.3%
-8%
-5%
-2%
1%
4%
7%
10%
13%
0.0
5.0
10.0
15.0
20.0
25.0
30.0
2006 2007 2008 2009 2010 Prel 2011 F 2012 F
Nominal GDP (GEL $bln) Real GDP growth, y-o-y (%)
GDP
General — Population: 4.4 million
— Currency: Georgian Lari (GEL)
Economy — GDP: USD 14.1 bln; GDP per Capita: USD 3,131 (Projected 2011)
— Total Government Debt (in % of GDP): 36.8% (Projected 2011)
— Average yearly Inflation June 2011: 11.3%; non-food inflation 2010 : 2.3%*
Currency — 1 USD = GEL 1.6665, 1 EUR = GEL 2.4054**
— USD/GEL during last five years: Max 1.89, Min 1.40
Ratings — Fitch Rating B+
— Standard & Poor's: B+/Stable
— Moody's rating: Ba3/Stable
Recent Achievements — No 1 “reformer” named by IFC/World Bank (Doing Business Report 2011)
— No 4 in TI 2010 Global Corruption Barometer together with Iceland and Portugal
(TI 2010 Global Corruption Barometer)
— No 12 globally in Ease of Doing Business in 2010 (Doing Business Report 2011)
Georgia At A Glance
Components of Nominal GDP* (2010 Prel)
Industry 16.9%
Trade 16.6%
Public Administration 13.0%
Transport & Communication 11.6%
Agriculture 8.4%
Healthcare & Social Assistance 6.6%
Construction 6.3%
Education 4.8%
Other 15.7%
Source: IMF
*Geostat Figure Source: IMF
* Calculated using nominal GDP (preliminary) at basic prices Source: Geostat
3
**As of June 30
Gel
Bln
4% 6% 7% 8% 8% 12%
20% 21%
33%
0%
5%
10%
15%
20%
25%
30%
35%
40%
TUR GEO CZE RUS POL BUL ROM UKR KAZ
impaired loans
9% 9% 11% 11% 12% 13% 14% 14% 17%
0%
5%
10%
15%
20%
25%
30%
ROM POL KAZ CZE UKR TUR BUL RUS GEO
Equity/Assets
30% 43% 43% 53% 54% 48%
70% 59% 76% 26%
33% 43% 35%
52% 58% 37%
76% 67%
0%
50%
100%
150%
200%
GEO KAZ RUS ROM POL TUR UKR CZE BUL
Loans/GDP Deposits/GDP
-1.3% 0.2% 2.3%
3.8% 3.9% 4.3%
6.4% 7.0%
8.2%
-3%
-1%
1%
3%
5%
7%
9%
11%
13%
15%
ROM BUL CZE POL RUS UKR GEO KAZ TUR
real gdp growth in 2010 real gdp growth in 2010
114%
Attractive Macroeconomic and Banking Sector Fundamentals
4
Real GDP growth 2010 and Loan Book Growth 2010
5 % 2 % 5 % 10% 3% 26% -6% 13% 20%
Loan to GDP and Deposits to GDP
Impaired Loans and Reserve Coverage
Reserve coverage of Impaired Loans
Real GDP growth Loan Book Growth
Equity to Assets and ROAE
NM 12.5% NM 11.9% NM 16.3% 6.3% 4.9% 13.5%
108% 131% 93% 153% 104% 83% 188% 78%
* Source: Fitch report, IMF data
ROAE
•Source: Individual countries’ Central Banks, Analyst Research. Data as at 31 December 2010 unless otherwise stated. •Note(1) Data as at 31 December 2009. Georgian Banking System ROE is given for 2011 H1 NBG reporting Standard * Source: Fitch report; Data as at 31 December 2010
* Source: Individual countries’ Central Banks, Analyst Research. Data as at 31 December 2010
(1) (1)
168% 57% 120% 65% 48% 56% 90% 88% 96%
Loan/Deposits
Main Regulatory Requirements
NBG Main Regulatory Requirements
•FX minimum reserves from 5% to 15% (From August 2011)
•For the borrowings in GEL of more than 1 year and borrowings in FC of more than 2 years not required from August 2011 Minimum Reserves
•Tier 1 > 8% and Total Capital > 12%
•Major difference with Basel is Foreign currency loan weighting at 175% Capital Requirements
•Liquidity ratio increased from 20% to 30%, (from October 2010)
•(NBG has acknowledged prudent liquidity management policy of TBC by Setting lower limit) Liquidity Ratio
•Early repayment fee of not more than 2%
•(May 2011) Yearly Repayment Fee
•Single Related party < 5% of capital •All related party < 25% of capital •Group exposure < 25 % of capital
Exposure ratios
In addition
No limits or restrictions on the sector or FX policy
In the future
NBG is discussing to introduce Loan to Deposit ratio of < 130% and non-resident deposit to total deposit book ratios < 20%. We will meet the requirements if it materializes as our Loan to Deposits is forecasted to be at 117% and non resident deposits is less than 5%
5
4,589
5,993
5,185
6,261 6,901
84%
31%
-13%
21%
20%
-20%
0%
20%
40%
60%
80%
100%
0
1,400
2,800
4,200
5,600
7,000
2007 2008 2009 2010 2011 I H
Gel
Mln
Total Loans Growth %
3,215 3,568 3,950
5,488 5,775 65%
11%
11%
39%
10%
0%
10%
20%
30%
40%
50%
60%
70%
0
1,400
2,800
4,200
5,600
7,000
2007 2008 2009 2010 2011 I H
Gel
Mln
Total Deposits Growth %
Georgian Banking Sector Growth Dynamics in USD Millions
6
Source: National Bank of Georgia. NBG Reporting Standard *Growth Annuialized
2,993
3,469
3,102
3,847 4,187
1,596
2,524
2,084 2,414
2,713
0
900
1,800
2,700
3,600
4,500
2007 2008 2009 2010 2011 I H
Gel
Mln
Corporate loans Retail Loans
1,666 1,709
1,846
2,846 2,964
1,549 1,859
2,104
2,641 2,812
0
800
1,600
2,400
3,200
4,000
2007 2008 2009 2010 2011 I H
Gel
Mln
Corporate Deposits Retail Deposits
Georgian Banking Sector Loan Growth Over Last 5
Years
Georgian Banking Sector Loan Growth Over Last 5
Years
Georgian Banking Sector Deposit Growth Over Last
5 Years
Source: National Bank of Georgia. NBG Reporting Standard
Source: National Bank of Georgia. NBG Reporting Standard
Georgian Banking Sector Deposit Growth Over Last
5 Years
Source: National Bank of Georgia. NBG Reporting Standard *Growth Annualized
Number of world’s largest financial institutions have partnered with Georgian banks :
Y 2000 Y 2002 Y 2004 Y 2006 Y 2008 Y 2010 Y 2011 Q2
2.6%
3.4%
3.9%
6.4%
6.4%
8.3%
25.1%
36.0%
2.0%
2.4%
2.5%
6.1%
8.1%
11.8%
30.0%
33.1%
All banks, including TBC Standalone, NBG Reporting Standards
Total Loans Retail Deposits
1.5%
3.0%
3.2%
6.5%
7.5%
8.5%
27.6%
34.6%
Total Deposits
Georgian Banking Sector – Eight Largest Banks Market Shares Q2 2011
7
• Georgian Banking Sector
• TBC Bank at a Glance
• Business lines
• Strategy and Forecast
• Financials
• Capital
Contents
8
• Corporate
49.1%
• Retail
35.5%
• SME
10.7%
• Micro** 4.7%
Fitch Moody’s
Long Term B+ Foreign Currency B1
Ratings
• No 1 by Retail Deposits – 33.1% of market share as at 30 June 2011
• A leading bank in the country with 25.1% of total customer loans market share as at 30 June 2011
• 45 branches, 183 ATMs, 2,414 POS’s across Georgia
• Number of accounts c. 615,800; Number of employees c. 2,400
• Entered microfinance segment in May, 2011 through acquiring Bank Constanta
• Presence in Azerbaijan-subsidiary TBC Kredit - non-banking credit organization
TBC Bank at a Glance
Financial Highlights and Ratios
(As of and for the Q2 2011) USD m
Total assets 1,657
Net loans 1,026
Customer deposits 972
Stockholders’ equity 249
Financial Ratios
ROE annualized (H1 2011) 24.3%
Cost to income (H1 2011) 49.2%
BIS Tier1 capital adequacy ratio (H1 2011) 19.5%
Key Facts About TBC
Shareholder Structure
Notes: Market shares are NBG Based, * Micro Segment includes Constanta Portfolio, Number of branches and number of accounts excludes Constanta
Loan portfolio composition as per the segments – 2-nd Q 2011
Source: TBC Bank Consolidated IFRS Statements (Unaudited) Exchange Rate Used: USD/GEL 1.6665
9
Georgian Shareholders 35.3%
European Bank for Reconstruction and Development (EBRD) 20.0%
International Financial Corporation (IFC) 20.0%
Deutsche Investitions-und Entwicklungsgesellschaft (DEG) 11.4%
JP Morgan 5.0%
Ashmor 5.0%
Netherlands Development Finance Company (FMO) 3.3%
History
1993 • TBC bank was granted banking license to Conduct International Operations in May
1996 • TBC Bank became a member of the international financial information exchange system S.W.I.F.T.
1997 • The Bank entered into a credit line with the World Bank for a principal amount of U.S.$1 million
1998 • TBC received funds in an amount of U.S.$ 2 million from EBRD, U.S.$ 3 million from IFC and DM 3 million from DEG
1999 • The volume of the Bank’s letter of credit provided by the EBRD was increased by USD 2 million
2000 • IFC and DEG became TBC Bank shareholders, each with a 10% share
2002 • TBC Bank became the principle member of VISA-INTERNATIONAL and started issuing Visa plastic card
2003 • EBRD allocated a USD 6 million credit line to the bank • TBC Bank’s total assets market share increased by 2.9 percentage points from y/e 2002 and reached historical maximum of 19.7
percent market share by y/e 2003
• The Bank’s subsidiary, TBC Leasing began operations
2005
• In February the Bank’s new Head Office was opened • TBC Bank’s total assets market share increased by 2.9 percentage points from y/e 2003 and reached historical maximum of 22.6
percentage market share by y/e 2005 • TBC Bank has acquired the license of general member bank from “MasterCard International”
2006 • The Bank entered into a U.S.$35 million loan facility with Citibank
2007 • The Bank raised USD 102m funding from J.P. Morgan, Credit Suisse and FMO, that included both senior and subordinated loans • TBC bank’s market share further increased by 1.1 percentage points from y/e 2005 and reached historical maximum of 23.7 percent • The Bank acquired 75% of the share capital of SOA Credit (currently TBC Kredit LLC), a company incorporated in Azerbaijan
10
2008
• The TBC Bank attracted funds totaling USD 206 million from foreign markets, including following international financial institutions: DEG, FMO, Merrill Lynch, Rose Mount, OTP, Banco International, EBRD, OPIC, CITI Bank
• In order to support the victims of the hostilities, TBC Bank established a charitable organization – “TBC Foundation” and made the initial contribution of GEL 5 million
2009
• EBRD, FMO, JP Morgan and Ashmore became the shareholders of TBC Bank • The Bank raised U.S.$ 138.3 m from four international financial institutions: IFC, EBRD, FMO and DEG, that included: Equity
contribution - $39.9m, Senior Loan – $52.3m, and Subordinated Loan - $44m • Recapitalization transactions changed the composition of the Supervisory Board: Each IFI shareholder has its nominee to the Board
2010 • The Bank’s growth continued despite the effects of the global financial crisis as reflected by the levels of specific financial indicators as
at 31 December 2010
2011 • In March 2011, the Bank acquired [80]% of the share capital of Bank Constanta, through which it entered the micro-finance segment. • TBC Bank was granted Visa and MasterCard licenses for electronic commerce merchant acquiring
2004
Current Shareholders
Shareholder Structure
11
Founder Shareholders
• Mamuka Khazaradze, Chairman of the supervisory board since 1992. Founded TBC-Group and JSC TBC Bank in 1992
• Until the early 2000s, Vice-Chairman of the Supervisory Board of Microfinance Bank of Georgia.
• Founded IDS Borjomi Georgia, Borjomi Beverages Co.N.V. • In 2004 he founded Georgian Reconstruction and Development
Company (GRDC), • Founded and served as the Chairman of the Lisi Lake
Development and the private high school -The American Academy in Tbilisi.
• Badri Japaridze, deputy chairman of the board since 1992. Co-Founder of TBC-Group and JSC TBC Bank in 1992
• Member of the Board of GeoPlant, the largest Georgian producer and exporter of green tea.
• Since the early-2000s, member of the Supervisory Board of both American Chamber of Commerce in Georgia and EU-Georgia Business Council (EUGBC).
• Board Member of Georgian Reconstruction and Development Company (GRDC) and Bank Constanta.
• Chairman of the Board of TBC-TV, a Georgian advertising company, and,
• Chairman of the Board of TBC Kredit, TBC Bank’s subsidiary in Azerbaijan.
• IFC Became a shareholder in May 2000. Eric Rajenda Member of the Supervisory Board nominated by IFC in 2010
• DEG Became a shareholder in May 2000. Steffen Shuhany Member of the Supervisory Board nominated by DEG in 2007
• EBRD Became a shareholder in April 2009. Mike Hesketh Member of the Supervisory Board nominated by EBRD in 2009
• FMO Became a shareholder in April 2009. Mike Hesketh Member of the Supervisory Board nominated by FMO in 2009
• JP Morgan and Ashmore Became a shareholder in April 2009, They are entitled (but not required) to send an observer to attend all meetings of the Supervisory Board
Two Founder Shareholders,
28%
EBRD, 20% I F C, 20%
Management &
Other 8%
JPMorgan 5%
Ashmore 5%
FMO 3%
D E G 11%
11
Source: IFRS Consolidated
Statements
12
IFI Shareholders
EBRD
EBRD - 20.0% • Total Exposure to TBC Bank
• Senior Loan - USD 71 ml • Subordinated Loan - USD 18.5 ml
• Diversified product range: • SME • Mortgage • Energy Efficiency • Trade Finance • RCA • Subordinated Loan • Agro Loan • Local Currency Loan • Co Financing Agreement • Revolving Facility
• TC Projects • EUR 500,000 worth TC project provided by EBRD in 2010 – 2011 covered 5
modules including: Corporate Recovery, Risk Management, Accounting and Finance, HR, IT.
• Ongoing TC project of Trade finance through E-learning • Various TC projects in different years to strengthen SME financing,
Environmental and Social Management System, Credit Risks, Operational Risks
IFC -20.0% • Total Exposure to TBC Bank
• Senior Loan - USD 31 ml • Subordinated Loan - USD 20.5 ml
• Diversified product range: • Subordinated Loan • Senior Loan • Revolving Facility
• TC Projects • Various TC projects in different years to strengthen SME
financing, Environmental and Social Management System, Credit Risks, Operational Risks
FMO – 3.3% • Total Exposure to TBC Bank
• Senior Loan - USD 21 ml • Subordinated Loan - USD 27 ml
• Diversified product range: • Subordinated Loan • SME Loan • Mortgage Loan • Revolving Facility
• TC Projects • TC projects in different years to strengthen ALM
DEG – 11.4% • Total Exposure to TBC Bank
• No Senior Loan • Subordinated Loan - USD 20 ml
• Diversified product range: • Subordinated Loan • Senior Loan • Revolving Facility
• TC Projects • Various TC projects in different years to strengthen
Environmental and Social Management System, Credit Risks
Cost Of Risk
0.4%
2.3%
7.2%
C/I
49.0%
55.1%
57.9%*
ROAA
3.8% (Annualized)
2.5%
0.2%
ROAE
24% (Annualized)
14%
1%
NPLs (PAR 90)
0.85%
1.6%
2.6%
Net Profit
48
49
3
Net Loans
1,710 (23.8% growth)
1,381 (39.7% growth)
988
Total Assets
2,762 (21.8% growth)
2,268 (30.5% growth)
1,738
2010
A Winning Franchise with Robust Performance throughout the Financial Crisis
2010 2010 2010
Awards
Banker Award 2010 Euromoney Award 2011
*IFRS Statements Unaudited 2011 Q2
*2009 Excludes one-off income of GEL 25900 and one-off expense 4,600
2009
2010
2009
2010
2009
2009 2009 2009
2010
2009
Source: TBC Bank Consolidated IFRS Audited Figures (Unaudited for H1 2011)
13
2010
2009
2011 1H* 2011 1H*
2011 1H* 2011 1H* 2011 1H* 2011 1H*
2011 1H* 2011 1H*
All Figures in Million GEL
Branches
45
POS
2414
TBC Pay
442
Mobile Banking
6.5K customers
Internet Banking
66K customers
Highly-Organized Call Center
Superior Customer Experience
“The Most Desired Employer in Georgia” - according to on-line
survey held by National Credit Information Bureau
Keeping up with Modern Day Banking
TBC Bank – Distribution Channels
14
Effective Branch Network
Net Loans and Deposits/Number of Branches*
Total Tbilisi Regions
Bank of Georgia 133 75 58
Procredit Bank 59 33 26
TBC Bank 45 31 14
Bank Republic 37 21 16
VTB Bank 16 7 9
GEL
Mln
Source: *NBG Based for comparison for 1H 2011
The Best Employer in the Market
Source: TNS Georgia 2011 report
Source: TBC Bank Internal Figures
36
17
13 10 9
35
17
11 10 8
0
10
20
30
40
50
TBC BOG VTB Republic Procredit
Net Loans/Number of Branches Total Customar Deposits/Number of Branches
75.0%
80.0%
85.0%
90.0%
95.0%
100.0%
2008-I 2008-II 2009-I 2009-II 2010-I 2010-II 2011-I
TBC BOG Republic ProCredit
26.00% 25.60%
26.70% 26.60% 26.70%
27.63%
20%
22%
24%
26%
28%
30%
10-Mar 10-Jun 10-Sep 10-Dec 11-Mar 30-Jun
432
854 946 756
976 1,095 159
314
509
413
572
775
56%
98%
25%
-20%
32% 21%
-40%
-20%
0%
20%
40%
60%
80%
100%
120%
0
400
800
1,200
1,600
2006 2007 2008 2009 2010 2011 Q2
Corporate Loans Retail Loans Growth %
21.99% 22.78%
23.38% 23.80% 24.22% 25.13%
15%
20%
25%
30%
10-Mar 10-Jun 10-Sep 10-Dec 11-Mar 30-Jun
Total Deposits Market Shares *
Sustainable Growth
15
Total Customer Deposits
Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 2011)
Total Loans Market Shares
* Excludes Railway Transfer of USD 250m
3.1
4 %
Source: NBG, NBG Reporting Standard
1.6
3 %
Gel
Mln
Gel
Mln
Total Gross Customer Loans
308 343 334 321 513
668 244
437 511 671
852
952
45% 41%
8%
17%
38%
19%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
0
400
800
1,200
1,600
2006 2007 2008 2009 2010 2011 Q2
Corporate Deposits Retail Deposits Growth %
Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 2011)
Source: NBG, NBG Reporting Standard
• Georgian Banking Sector
• TBC Bank at a Glance
• Business lines
• Strategy and Forecast
• Financials
• Capital
Contents
16
2008 2009 2010 2011 Q2
Customer Loans (Gel Mln)
Customer Deposits* (Gel Mln)
# of accounts (‘000)**
Net Income (Gel Mln)***
Universal Bank with Diverse Customer Base
17
Corporate SME Retail Micro ****
% of Loans
% of Deposits
Loans > USD 1,5m Or Turnover => GEL 8m
Loans < USD 1,5m Or Turnover <
GEL 8m
All Individual Customers
Total Portfolio of Constanta Loans <
USD 150K
54 52 49 52
2008 2009 2010 2011 Q2 2008 2009 2010 2011 Q2 2008 2009 2010 2011 Q2
29 23 31 28
13 13 9 10
11 9 10 10
33 35 37 38
60 68 58 62
N/A N/A 5 N/A
N/A N/A 0.4 N/A
Source: 2010 TBC Bank audited consolidated IFRS Figures, SME Deposits – Internal Data (H1 2011 unaudited) Notes: *Customer Deposits Internal Data, **Number of Accounts Internal Data - excluding accounts with zero balances, *** Net Income Internal Data, **** Bank Constanta Data, ***** Bank Constanta Standalone Profit, consolidated by TBC as at H1 2011 will be only 0.5 mln Note: figures exclude Minority shares
918 176 687 88
3.5 23.2 508 14
28.1 11.0 1.2*****
506 162 945 7
8.1
198
153 153
176
82 91
136
162
0
50
100
150
200
250
2008 2009 2010 2011 Q2
Gel
mln
SME Loans SME Deposits
802 604
812 918
252 229
377
506
27%
23% 24% 26%
20% 18% 18%
22%
0%
5%
10%
15%
20%
25%
30%
0
200
400
600
800
1,000
1,200
2008 2009 2010 2011 Q2
Gel
mln
Corporate Loans Corporate Deposits
Market Share CL Market Share CD
Corporate
SME
Corporate & SME Banking
18
Defined as loans more than USD 1.5 m and turnover minimum GEL 8 m
2nd position in the market by loan and deposit portfolio size as well as by the number of clients
c. 1,400 clients, 4,240 accounts, 760 loans
Strong industry expertise. Especially strong presence in following industries: Energy, Consumer Product and Services , Oil and Gas, Food and Drinks, Construction
Convenient Service Model in the head office and major branches, Bank-Client, Internet Banking, Call Centre. 81%* of non cash transactions are performed by e-channels
The strongest brand and most appropriate image Diversified product: Trade Finance, Asset Finance, Project Finance, Working
Capital, Syndicated Loans
Defined as loans up to USD 1.5 m and turnover up to GEL 8 m
No 1 by SME Deposits – 149 mln GEL vs 118 mln GEL PCB total Corporate**
No 2 by SME Loans – 176 mln GEL vs 386 mln GEL of PCB**
c. 26000 customers, 44,000 accounts, 1,200 loans
Customers can access 45 branches across all major cities with the highest service quality that is expressed in bright and comfortable environment, politeness and high qualification of staff and quick service
Strong presence in following industries: Consumer Product and Services, Food and Drinks, Real Estate, Health care and Construction etc
Convenient Internet banking, Bank-Client, Internet Banking, Call Centre. 87%* of non cash transactions are performed by e-channels
Corporate Loans & Deposits
SME Loans & Deposits
Surce: TBC Bank Consolidated IFRS Statement (derived from audited statement, H1 2011 unaudited). market Shares TBC Standalone NBG Reporting based
Surce: TBC Bank Consolidated IFRS Statement (derived from audited statement, H1 2011 unaudited). * TBC bank Standalone ** SME market position based on TBC Bank Standalone NBG standard reporting
486 413
584 687
511 671
852 945
27.0%
31.4% 31.8% 33.1%
19.8% 20.1% 23.2% 24.2%
0%
5%
10%
15%
20%
25%
30%
35%
40%
0
300
600
900
1,200
1,500
2008 2009 2010 2011 Q2
Gel
Mln
Retail Loans Retail Deposits
Market Share RD Market Share RL
Retail Segment
19
Defined as all individual customers Number 1 in Deposits, 2nd in Loans 45 branches, 183 ATMs, 2414 POS’s across Georgia c.567,500 accounts, c. 512,800 Debit Cards, c.5,500 mortgages 942 VIP customers, separate service and products for VIPs with Personal
Bankers The highest Service quality in the branches that is expressed in bright and
comfortable environment, politeness and high qualification of staff and quick service
Significant multi channel capabilities including internet banking, SMS banking, TBC Cash in and call centre. 40%* cash in and 61%* of non cash transactions are performed by e-channels
The strongest brand and most appropriate image
Retail Loans & Deposits
58 53 69
88
0.95% 1.02%
1.10%
1.25%
0.0%
0.2%
0.4%
0.6%
0.8%
1.0%
1.2%
1.4%
0
15
30
45
60
75
90
2008 2009 2010 2011 Q2
Gel
Mln
Total Loans Market Share
Recently acquired bank focused purely on micro finance segment with the strongest image and the best developed expertise in the segment
4-th in the micro loans
c. 442 employees, assets of GEL 114 m (2Q 2011)
c. 14,000 accounts, 25,000 loans
22 branches across the country, specific products for microfinance in rural areas
Well-diversified high quality credit portfolio
Micro Loans Micro Segment
Retail & Micro Banking
*Note: TBC Bank Standane
Source: TBC Bank Consolidated IFRS Figures (Unaudited H1),
NBG standards for market share information.
Source: bank Constanta IFRS Figures (Unaudited H1),
NBG standards for market share information.
• Georgian Banking Sector
• TBC Bank at a Glance
• Business lines
• Strategy and Forecast
• Financials
• Capital
Contents
20
• Implement the best (functionality and design) Multichannel platform in the region. (Including internet-banking, mobile/Ipad –banking. Actively, promote sales and service though the e-channels
1. Establish the Best Multichannel Service and Sales Model
• Replacement of the core banking software applications (Includes: cards, loans and deposits modules), development of a single customer view to further enhance customer experience and decrease cost per transition.
2. Achieve Breakthrough in Automation and Quality of Processes to Improve Customer Satisfaction
• Form foreign representatives offices, create organizational system for direct sales , Improve products and procedures and improve technological channels and communication to attract non-resident deposit.hence support growth and decrease cost of funding.
3. Become Number One in Non-Resident Deposit Portfolio
4. Microfinance Segment Development
Strategic Initiatives
A Fine-tuned Strategy
*ProCredit Bank
• Increase market penetration by opening branches in rural areas, develop new products and services, tasilored to microfinance segment, laverage from TBC Bank knowledge and experitese for synergy effect, develop cross selling capabilities between TBC and Constanta
Description
21
Main Targets 2011 Q2 Medium Term Targets
ROE 24.3% 20%
Cost to income (without Provisions) 49.6% 51.0%
Market Share in deposits 27.6% 28.6%
Market Share in loans 25.1% 26.3%
Segment Aspirations 2011 Q2 Medium Term Targets
Retail Deposits 33.1%
24.2% 33.5% 25.3% Loans
SME Deposits
100% PCB* 42%
120% PCB* 43% Loans
Corporate Deposits 22.4%
25.7% 24.7% 25.8% Loans
Micro Loans/Constanta Loans 7% N/A
Source: TBC Bank IFRS Statement (Unaudited 2011 H1), Medium Term targets from
Internal Data
• Georgian Banking Sector
• TBC Bank at a Glance
• Business lines
• Strategy and Forecast
• Financials
• Capital
Contents
22
-58
3
49 48 -3.2%
0.2%
2.5% 3.8%
-10% -80
-60
-40
-20
0
20
40
60
2008 2009 2010 2011 1H
Net Income ROAA, annualized
-58
3
49 48
-20%
1%
14%
24%
-20%
0%
20%
-80
-60
-40
-20
0
20
40
60
2008 2009 2010 2011 1H
Net Income ROAE, annualized
Rapid Post Crisis Recovery
Operating Efficiency
236
211 211
123 107 112 116
61
44.1% 52.9%
55.1% 49.6%
0%
10%
20%
30%
40%
50%
60%
0
50
100
150
200
250
2008 2009 2010 2011 1H
Net Revenue Non-Operating Expenses Cost to Income
Net Income, ROAE
Provision Expenses
Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 2011).
Gel
Mln
Gel
Mln
G
el M
ln
Gel
Mln
23
Net Income, ROAA
Note: 2009 Cost to Income Ratio excludes extraordinary income
196
94
31 4
14.9%
7.2%
2.3% 0.4%
0%
2%
4%
6%
8%
10%
12%
14%
16%
0
50
100
150
200
250
300
2008 2009 2010 2011 1H
Loan Provision Expense Cost of Risk
Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 2011).
Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 2011). Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 2011).
Pawn-Shops, 7%
Consumer, 23%
Fast consumer, 5%
Credit Cards, 14%
Cash Covered, 3%
Mortgage, 49%
24
Corporate Loans RB Loans SME Loans
Well Diversified Loan Book
Loans by Currency, 2011, June 30 Loan Book – Historical Data
Consolidated Audited IFRS figures, unaudited data for 2011 Q2
Source: TBC Bank Standalone NBG Reporting Standard As of June 30
Financial service, 4%
Development and real estate realization, 8%
Energy, 9%
Communication, 11%
Oil and gas, 13%
Construction, 8%
Food and drink, 7%
Consumer Service and
Product, 17%
Agriculture, 1%
Other, 23%
Source: TBC Bank Standalone NBG Reporting Standard As of June 30
30% 14% 20%
70% 86% 80%
0%
20%
40%
60%
80%
100%
120%
RB CB Total
FC
GEL
2% 9%
18%
17%
49%
0
400
800
1200
1600
2000
2009 2010 2011 Q2
Retail
SME
Corporate
35%
13%
52%
37%
10%
53%
42%
9%
49%
1,169
1,548
1,869
Financial service, 3%
Real Estate, 19%
Healt Care, 8%
Transport and Logistics, 4%
Oil and gas, 2%
Construction, 13%
Food and drink, 11%
Consumer Service and
Product, 30%
Raw Materials, 3%
Other, 8%
Source: TBC Bank Standalone NBG Reporting Standard As of June 30
Source: Audited IFRS Statements, Unaudited data for 2011 Q2
Provision Level to Gross Loans and NPL Coverage
Concentration and Quality of The Loan Book
25
NPLs* to Gross Loans
Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 2011)
*NPLs are defined as Loans overdue more than 90 days
Loan Concentration to Gross Loans
Related Party Loans to Capital
11.51% 15.47%
10.81% 8.57%
68% 84%
116%
126%
0%
20%
40%
60%
80%
100%
120%
140%
0%
10%
20%
30%
40%
50%
2008 2009 2010 2011 1H
Provision Level To Gross Loans NPL + restructured loans coverage ratio
23% 24% 27%
25%
3% 2% 3% 3%
0%
10%
20%
30%
40%
50%
2008 2009 2010 2011 1H
20 Largest Borrowers Single Largest Borrower
3.6% 2.6% 1.6% 0.8%
17.0% 18.4%
9.3% 6.8%
0%
10%
20%
30%
40%
50%
2008 2009 2010 2011 1H
NPL's Gross Loans NPLs+Restructured Loans to Gross Loans
22%
13%
6% 4%
8% 7%
2% 2%
0%
10%
20%
30%
40%
50%
2008 2009 2010 2011 1H
All Related party Loans Top 1 Related party Loan
Source: TBC Bank Internal Data Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 2011)
Source: TBC Bank Internal Data
0
400
800
1,200
1,600
2,000
2008 2009 2010 2011 1H
Current/settlement accounts Term deposits
172%
118% 113% 115%
-100% -80% -60% -40% -20% 0% 20% 40% 60% 80% 100% 120% 140% 160% 180% 200%
0
400
800
1,200
1,600
2,000
2008 2009 2010 2011 1H
GEL FC Loans to Deposits Ratio
Strong and Growing Funding Base
26
Liabilities Structure, 2011, Q2
Deposit Portfolio Concentration (M GEL)
Deposits by Type
43%
57% 52%
48%
45%
55%
845
991
1,365
22.72%
77.28%
26.0%
74.0%
27.7%
73.3% 845
991
1,365
18.2%
11.3%
16.3% 17.9%
1.1% 0.9% 0.7% 0.8%
0%
10%
20%
30%
40%
50%
2008 2009 2010 2011 1H
20 Largest Deposits All Related Party Deposits
48%
52%
1,620
Deposits by Currency
76.1%
23.9%
1,620
Due to other banks, 5%
Customer Accounts, 69%
Other borrowed funds , 17%
Other liabilities, 2%
Subordinated debt, 6%
Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 2011);
Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 2011); Source: TBC Bank Consolidated IFRS Audited Figures (Non-Audited for H1 2011);
Source: TBC Bank Internal Data
• Georgian Banking Sector
• TBC Bank at a Glance
• Business lines
• Strategy and Forecast
• Financials
• Capital
Contents
27
11.1%
16.3%
12.2% 10.3%
10.90%
22.80%
17.60%
13.44%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
2008 2009 2010 2011 1H
Tier I Capital Adequacy Ratio Total Capital Adequacy Ratio
Source: TBC Bank Standalone NBG Reporting Standard, (Unaudited IFRS 2011 1H)
Strong Capital Base
28
BIS Capital Adequacy Ratios NBG Capital Adequacy Ratios
Source: TBC Bank Consolidated IFRS Audited Figures (Unaudited IFRS 2011 1H)
Main Difference between BIS and NBG Capital Adequacy Rations
Foreign Currency Loans are weighting - 175% for NBG regulations
General Loan Reserve are included in NBG Capital
Revaluation Reserve is included in BIS Capital
Minimum Requirement of Total Capital Adequacy – 12%
Minimum Requirement of Tier I Capital Adequacy – 8%
13.3%
25.3%
21.4% 19.5% 18.80%
38.20%
30.00%
25.80%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
2008 2009 2010 2011 1H
Tier I Capital Adequacy Ratio Total Capital Adequacy Ratio