3Q09 Presentation
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Transcript of 3Q09 Presentation
Disclaimer
All financial information presented herein is consolidated, including the Bank´s financialstatements, its subsidiaries, the Credit Receivables Investment Fund Paraná Banco I, CreditReceivables Investment Fund Paraná Banco II (FIDC), the insurers JMALUCELLI Seguradora,JMALUCELLI Seguradora de Crédito (pending SUSEP`s approval) the reinsurer JMALUCELLI ReJMALUCELLI Seguradora de Crédito (pending SUSEP s approval), the reinsurer JMALUCELLI Re.,JMALUCELLI Agenciamento and Paraná Administradora de Consórcio.
All information, except when otherwise indicated, is presented in the Brazilian currency (in Reais)and was prepared based on the accounting practices g p pursuant to the Brazilian Corporatep p g p g p p pLaw, associated with the regulations and instructions issued by the National Monetary Council(“CMN”), the Brazilian Central Bank (“BACEN”), the Brazilian Securities and ExchangeCommission ("CVM"), the National Council of Private Insurance (“CNSP”), the Brazilian PrivateI A th it (“SUSEP”) d th A ti St d d C itt (“CPC”) hInsurance Authority (“SUSEP”) and the Accounting Standards Committee (“CPC”), wheneverapplicable.
Information contained herein regarding future events is exposed to risks and uncertainties and issubject to change resulting from among other factors: market behavior Brazil’s economical andsubject to change, resulting from, among other factors: market behavior, Brazil s economical andpolitical situation, and changes in legislation and regulations. Information presented herein isentirely based on the expectations of the Bank’s Administration regarding its future performance,and does not constitute a guarantee of performance.
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Market and Economic Environment
G th A l tiInflation
Converging to Target/ Low Interest Rate
Growth Acceleration Program (”PAC”)
Tax Waivers and Incentives
Interest Rate
Investment in Infrastructure World CUP 2014World CUP 2014
Recovery in credit
Olympic Games 2016
D bl t it th i dit i f t t (i b i )D bl t it th i dit i f t t (i b i )
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Double opportunity: growth in credit + infrastructure (insurance business)Double opportunity: growth in credit + infrastructure (insurance business)
Main Highlights
Net Income in 3Q09:R$ 21.1 million 10.5% vs. 3Q08 R$ 75.2 million
Total Deposits:
R$ 935.4 million 19 1% 2Q0910.5% vs. 9M08
P fit bilit
19.1% vs. 2Q09
T t l A t Profitability:
ROAE of 10.9% (3Q09) and 12.6 (9M09) ROAA of 3.3% (3Q09) and 4.2% (9M09)
Total Assets: R$ 2.6 billion
7.1% vs. 2QT0911.0% vs. 3Q08
NIM of 14.7% (3Q09) and 13.2% (9M09)
Loan Portfolio:Loan Portfolio:
R$ 1,205.3 million4.1% vs. 2Q09
Portfolio from AA to C:
93.8% of Paraná Banco`s
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portfolio.
Main Highlights – Insurance
Net Income - Insurer: R$ 6.3 million
53.2% vs. 3Q08 R$ 19 7 million
Fitch Ratings:Revision of JM Seguradora rating
from 'A-(bra)' to 'A (bra)'R$ 19.7 million 37.2% vs. 9M08
( ) ( )
M k t h i A tMarket-share in August:
JM Seguradora: 31.4% JM Re: 38 7%
Insurance business share:
35.7% of 3Q09t i
Combined Ratio
JM Re: 38.7%
Retained Premiums
net income
Combined Ratio JM Seguradora: 65.8%
-15.9 p.p. vs. 3Q08
Retained Premiums JM Seguradora + JM Re:
R$ 27.1 million
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R$ 27.1 million 59.1% x 2Q09
Financial Performance
9M09 9M08 9M09 x 9M08
3Q09 x 3Q08
R$ thousand 3Q09 2Q09 3Q09 x 2Q09
3Q08
Income from financial operations 88,205 83,962 5.1% 103,104 (14.5%) 252,128 288,045 (12.5%)Expenses from financial operations (41,500) (30,986) 33.9% (57,193) (27.4%) (109,444) (127,397) (14.1%)Result from financial operations 46,705 52,976 (11.8%) 45,911 1.7% 142,684 160,648 (11.2%)Efficiency Ratio 58.3% 48.8% 9.5 p.p. 58.5% -0.2 p.p. 56.7% 59.8% -3.1 p.p.
Result from Financial Operations before Allowance for Doubtful Accounts (PDD)
65,230 63,188 3.2% 56,000 16.5% 182,785 187,410 (2.5%)
9M08 9M09 x 9M08
Net Interest Margin (NIM) 3Q09 2Q09 3Q09 x 2Q09
3Q08 3Q09 x 3Q08
9M09
Allowance for Doubtful Accounts (PDD)Financial operations annual margin before allowance %
14.7% 15.4% -0.7 p.p. 12.4% 2.3 p.p. 13.2% 13.4% -0.2 p.p.
Result from Financial Operations: 1.7% growth year-over-year.
Efficiency Ratio: 58.3%, increase of 9.5 pp over 2Q09. Impacted by the increase in retained claims
Result from Financial Operations: 1.7% growth year-over-year.
Efficiency Ratio: 58.3%, increase of 9.5 pp over 2Q09. Impacted by the increase in retained claims and merger of FIDC Paraná Banco I.
Net Interest Margin: 14.7%, an increase of 2.3 pp year-over-year, driven by the reduction in basic interest rates and funding expenses.
and merger of FIDC Paraná Banco I.
Net Interest Margin: 14.7%, an increase of 2.3 pp year-over-year, driven by the reduction in basic interest rates and funding expenses.
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Financial Performance
Net Income(R$ thousand)(R$ thousand)
10.5%
68,10475,235
10.5%
19 113 21 123
10.5%
26.3% 39.8% 32.8% 35.7%
9M08 9M09 3Q08 3Q09
19,113 21,123
9M08 9M09 3Q08 3Q09
Share of the Insurance Business
Growth in Net Income: Recovery in credit, reduction in operating expenses and financial expenses due to lower funding rates in comparison to the average registered in 3Q08.
Increasing share of the insurance business in total earnings.
Growth in Net Income: Recovery in credit, reduction in operating expenses and financial expenses due to lower funding rates in comparison to the average registered in 3Q08.
Increasing share of the insurance business in total earnings.
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Operational Performance
3Q09 x 3Q08
3Q09 2Q09 3Q09 x 2Q09
3Q08
Loan Portfolio (R$) 1,205,341 1,158,182 4.1% 1,467,142 (17.8%)
Total Deposits (R$ thousand) 935,454 785,231 19.1% 996,087 (6.1%)
Time Deposits (R$ thousand) 783,482 735,891 6.5% 827,173 (5.3%)
3Q082Q09
11.9%
Loan Portfolio – Operations Falling Due
12.3%
Funding – Operations Falling Due
23.0%
37 7%
Up to 3 months
Between 3 and 12 months
Between 1 and 3 years
23.2%
37 4%
Up to 3 months
Between 3 and 12 months
Between 1 and 3 years
27.4%
37.7% Between 1 and 3 years
Above 3 years27.1%
37.4% y
Above 3 years
Loan Portfolio: 4.1% growth, in line with the recovery in the credit market.
Matching of Terms: 50 4% of the portfolio and 50 3% of funding maturing within 1 year
Loan Portfolio: 4.1% growth, in line with the recovery in the credit market.
Matching of Terms: 50 4% of the portfolio and 50 3% of funding maturing within 1 year
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Matching of Terms: 50.4% of the portfolio and 50.3% of funding maturing within 1 year.Matching of Terms: 50.4% of the portfolio and 50.3% of funding maturing within 1 year.
Quality of the Loan Portfolio
R$ 3Q09 2Q09 3Q09 x 3Q08 3Q09 x
Allowance for Doubtful Accounts (PDD) 62,331 56,562 10.2% 47,381 31.6%Portfolio (> 90 days) 67,023 60,802 10.2% 48,953 36.9%Portfolio (> 180 days) 38,475 34,602 11.2% 26,485 45.3%T t l P tf li * 1 347 703 1 339 040 0 6% 1 476 543 (8 7%)
R$ 3Q09 2Q09 2Q09 3Q08 3Q08
Total Portfolio* 1,347,703 1,339,040 0.6% 1,476,543 (8.7%)Portfolio Coverage Index (PDD / > 90 days) 93.0% 93.0% (0.0%) 96.8% (3.9%)Portfolio Coverage Index (PDD / > 180 days) 162.0% 163.5% (0.9%) 178.9% (9.4%)Allowance for Doubtful Accounts (PDD) / Total Portfolio 4.6% 4.2% 0.4 p.p. 3.2% 43.8%* Includes balance of assignment with co-obligation. Includes balance of assignment with co obligation.
Delinquency rate - Paraná BancoPayroll deductable (> 90 days) = 4.7%
Small and Mid Companies(> 90 days) = 1.1%
Delinquency Rate- Brazilian Financial System (“SFN”)
Individuals (> 90 days) = 8 2%
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Individuals (> 90 days) = 8.2% Corporations (> 90 days) = 4.0%
Funding
Funding Sources
901
6334
142
2005 2006 2007 2008 1Q09 2Q09 3Q09
MTN FIDCs Loans Assigment Deposits
Time Deposits: traditionally the Bank´s largest funding source.
Total Deposits: increase of 19.1% in the quarter. Increased participation of institutional investorsand other companies
Time Deposits: traditionally the Bank´s largest funding source.
Total Deposits: increase of 19.1% in the quarter. Increased participation of institutional investorsand other companiesand other companies.
Issue overseas: R$ 35 million maturing in August 2011 (portfolio is 100% hedged)
and other companies.
Issue overseas: R$ 35 million maturing in August 2011 (portfolio is 100% hedged)
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Segmentation
Payroll-Deductable Loan Origination Sector Distribution - SME
14.1%21.2% INSS
States
16.7%
Industry
31.1%
30.6%
Armed Forces
Municipality
Others
11.4%
72.0%
Commerce
Services
3.0%
Payroll-Deductible Loans: diversification dilutes the regulatory risk of credit andconcentration of agreements.
Payroll-Deductible Loans: diversification dilutes the regulatory risk of credit andconcentration of agreements.
Alternative Distribution Channels: 80 franchises, 4 in progress and 7 own stores.
Small and Mid Companies: growth of 18.4% in 3Q09. Synergy with the JMalucelli Seguradora represents 7.0% of the portfolio. Distribution in the platforms of Curitiba and São Paulo.
Alternative Distribution Channels: 80 franchises, 4 in progress and 7 own stores.
Small and Mid Companies: growth of 18.4% in 3Q09. Synergy with the JMalucelli Seguradora represents 7.0% of the portfolio. Distribution in the platforms of Curitiba and São Paulo.
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Origination
Origination of the Payroll‐Deductible Loans(R$ thousand)
283,455
337,789
7.0%
8.0%
9.0%
300,000
350,000
400,000 (R$ thousand)
226,901
131,139 161,179
182,819
4.0%
5.0%
6.0%
150,000
200,000
250,000
72,819
,
2.0%
3.0%
4.0%
50,000
100,000
150,000
1.0%-1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09
Origination Commissions/Origination
Payroll-Deductable Loans Origination: 13.4% increase in 3Q09.Payroll-Deductable Loans Origination: 13.4% increase in 3Q09.
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Market ‐ Share (August 2009)
Market Share Evolution - direct premiums JMalucelli Re. Market Share
499,334 519,698
Market Share Evolution - direct premiums(R$ thousand)
3.5%
JMalucelli Re. Market ShareTotal Reinsurance Premius (%)
J. MALUCELLI RESSEGURADORAS A
187,768 167,452192,364
346,089
38.7%26.9%
RESSEGURADORA S.A.
IRB BRASIL RESSEGUROS S.A.
MAPFRE RE DO BRASIL COMPANHIA DE RESSEGUROS
29.2% 37.0% 42.3% 50.4% 43.0% 31.4%
,
2004 2005 2006 2007 2008 Aug-0929.8%
1.1%MUNCHENER RUCK DO BRASIL RESSEGURADORA S.A.
XL RESSEGUROS BRASIL S.A.
g
JMalucelli Seguradora Market
JMalucelli Seguradora: market leader - profitable operation, low claims ratio, agility in credit analysis, selectivity of clients and attractiveness to reinsurers.
JM l lli R d 1 t i th f fi i l i k
JMalucelli Seguradora: market leader - profitable operation, low claims ratio, agility in credit analysis, selectivity of clients and attractiveness to reinsurers.
JM l lli R d 1 t i th f fi i l i k
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JMalucelli Resseguradora: 1st in the group of financial risks.JMalucelli Resseguradora: 1st in the group of financial risks.
Operational Performance (Insurance)
50% Insurance Claims
40%
50% Claim Ratio 164,893 Insurance Claims
31.8%
20%
30%
76,155 76,004
5.6%
0%
10%38,273
29,950
16,146
253 4,025 2,372 6,457 9,056 9,025
0%
2004 2005 2006 2007 2008 Aug‐09
Market JMalucelli Seguradora
2004 2005 2006 2007 2008 Aug‐09
Insurance Claims Market Insurance Claims JMalucelli Seguradora
Expected performance: 61.1% increase in retained claims. Our estimated claims ratio werealready ascending due to the scenario of uncertainties.
Expected performance: 61.1% increase in retained claims. Our estimated claims ratio werealready ascending due to the scenario of uncertainties.
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Capital Structure
Initial Balance 804,540 807,363
Equity Changes (R$ thousand) 3Q09 2Q09
Net Income 21,123 33,819 Interest on Equity (7,547) (18,284)
Treasury shares (6,363) (18,349) Adjustment to market value - Marketable securities 6 (9) Others (391) -
Final Balance 811,368 804,540
3Q08Capital ComplianceBasel II Rules
3Q09 2Q09 1Q09 4Q08
Reference Shareholder's Equity 810,347 804,946 807,027 807,759 809,092Reference Shareholder's Equity Required 280,596 275,500 288,408 304,271 261,133Basel required minimum margin 529,751 529,446 518,619 503,488 547,959
Basel II Rules
Ch i Sh h ld ’ E it i t d b th 5th d 6th h b b k d b thCh i Sh h ld ’ E it i t d b th 5th d 6th h b b k d b th
Margin / Reference Shareholder's Equity Required 189% 192% 180% 165% 210%
Changes in Shareholders’ Equity: impacted by the 5th and 6th share buy-back programs and by the payment of IOE worth R$ 7.6 million in 3Q09.
Basel II: Shareholders’ equity exceeded 189% of minimum required by the Brazilian Central Bank.
Changes in Shareholders’ Equity: impacted by the 5th and 6th share buy-back programs and by the payment of IOE worth R$ 7.6 million in 3Q09.
Basel II: Shareholders’ equity exceeded 189% of minimum required by the Brazilian Central Bank.
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Corporate Governance
1 4 155 600 8 85 36 768 E d d 07/07/2008
Total Cost (R$ million) StatusPrograms Acquired
SharesAverage
Price
1 4,155,600 8.85 36,768 Ended on 07/07/20082 4,072,300 5.06 20,604 Ended on 03/17/20093 3,331,800 4.06 13,526 Ended on 04/01/20094 2,987,200 5.55 16,568 Ended on 05/27/20095 2,756,400 8.61 23,746 Ended on 10/13/2009
* Data which refers to this program was updated on 10/16/2009
6* 603,000 9.50 5,728 OngoingTotal 17,906,300 6.53 116,940
RatingA‐
Rating Rating / Ranking RatingbrBBB+ 11.13 A
1Q09 5,974,417.92 0.06 1.302Q09 18,283,706.08 0.19 2.68
Distributed Gross Value (R$)
Interest on Equity per share (R$)
Dividend Yield (%)
Interest on Equity: R$ 7 6 million equivalent to $ 0 08 per share and payout of 36 1%Interest on Equity: R$ 7 6 million equivalent to $ 0 08 per share and payout of 36 1%
June 2009July 2009
Low Credit RiskA brBBB+ 11.13 A
Low Credit Risk Low Credit Risk ‐Medium term
May 2009
Low Credit Risk
June 2009
3Q09 7,632,650.56 0.08 0.82Total 31,890,774.56 0.33
Interest on Equity: R$ 7.6 million, equivalent to $ 0.08 per share and payout of 36.1%.
Share Buyback Program: 6th program in progress.
R ti i i Ri kB k i d f 11 07 t 11 13 l i P á B t 11th iti
Interest on Equity: R$ 7.6 million, equivalent to $ 0.08 per share and payout of 36.1%.
Share Buyback Program: 6th program in progress.
R ti i i Ri kB k i d f 11 07 t 11 13 l i P á B t 11th iti
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Ratings: increase in RiskBank index from 11.07 to 11.13, placing Paraná Banco at 11th position among Brazilian banks.
Ratings: increase in RiskBank index from 11.07 to 11.13, placing Paraná Banco at 11th position among Brazilian banks.
PRBC4 Performance
14 000
16,000
18,000
350 00
400.00
450.00
housand)
basis 100)
10,000
12,000
14,000
250.00
300.00
350.00
OLU
ME (R$ t
ARE
PRICE
(b
6,000
8,000
150.00
200.00
TRADING VO
SHA
‐
2,000
4,000
‐
50.00
100.00
DAILY T
Volume PRBC4 IBOV
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Investor Relations
Mauricio N. G. Fanganiello IR Coordinator
Cristiano MalucelliIRO IR Coordinator
Ph: (+55 41) 3351-9765
IRO
Ph: (+55 41) 3351-9950
Marianne C. BaggioIR Analyste-mail: [email protected]
IR Website: www paranabanco com br/irPh. (+55 41) 3351-9645
IR Website: www.paranabanco.com.br/ir
This presentation may include estimates and forward-looking statements. These estimates and forward-looking statements are to a large extent based on currentexpectations and projections regarding future events and financial trends that affect or may come to affect the company’s business. Many important factors may adverselyaffect the results of Paraná Banco as described in our estimates and forward-looking statements. These factors include, but are not limited to, the following: the Brazilian andinternational economic situation, fiscal, foreign-exchange and monetary policies, higher competition in the payroll deductible loan segment the ability of Paraná Banco toobtain funding for its operations and amendments to Central Bank regulations. The words: “believe”, “may”, “could”, “seek”, “estimate”, “continue”, “anticipate”, “plan”,“expect” and other similar words are intended to identify estimates and projections. The considerations involving estimates and forward-looking statements includeinformation related to results and projections, strategies, competitive positioning, the industry environment, growth of opportunities, the effects of future regulations, and theimpact from competitors.
Said estimates and projections refer only to the date on which they were expressed, and we do not assume any obligation to publicly update or revise any of these estimatesarising from the occurrence of new information, future events, or any other factors. In view of the risks and uncertainties described above, the estimates and forward-lookingstatements contained in this presentation may not materialize. Given these limitations, shareholders and investors should not make any decisions based on the estimates,projections and forward-looking statements contained herein.
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