Earnings Presentation - Banco Votorantim · Earnings Presentation 4th Quarter, 2016 Disclaimer:...
Transcript of Earnings Presentation - Banco Votorantim · Earnings Presentation 4th Quarter, 2016 Disclaimer:...
Earnings Presentation
4th Quarter, 2016
Disclaimer: This presentation may include references and statements on expectations, planned synergies, growth estimates, projections of results, and future strategies for Banco
Votorantim, it’s associated and affiliated companies, and subsidiaries. Although these references and statements reflect the management’s belief, they also involve imprecision and
risks that are highly difficult to be foreseen. Consequently, they may conduct to different results from those anticipated and discussed here. These expectations are highly dependent on
market conditions, on Brazil’s economic and banking system performances, as well as on international market conditions. Banco Votorantim is not responsible for bringing up to date
any estimate in this presentation.
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Net Income of R$ R$ 426M in 2016 Consistent revenue generation, drop in credit provisions and cost base under control
Net Income
of R$ 426M
Net Income of R$ 426M in 2016, compared to R$ 482M in 2015
• In 4Q16, the Net Income totaled R$ 119M (R$ 112M in 3Q16)
Shareholders’ equity reached R$ 8.43B in Dec/16
Consistent
revenue
generation
Income from Services and Insurance increased 17.3% in 2016/2015, more than offsetting the 1.3%
decrease observed in the Net Interest Income, due to the conservatism in credit underwriting
Net Financial Margin grew 11.0% in 2016, to R$ 2.56B, reflecting the drop in credit provisions
Conservative
approach
to credit
Expanded credit portfolio of R$ 60.9B in Dec/16 – down 7.1% in 2016, but up of 1.4% in 4Q16
• Wholesale: portfolio of R$ 27.4B, up by 2.4% in 4Q16
• Auto Finance: portfolio of R$ 28.2B, an increase of 1.3% compared to Sept/16
Drop in
delinquency
90-day NPL of 5.5%, flat in the quarter, and 20bps lower than Dec/15
• Wholesale: 90-day NPL of 5.6% (Dec/15: 5.8%)
• Consumer Finance: 90-day NPL of 5.5% (Dec/15: 5.7%). Vehicles’ NPL dropped to 5.1% (Dec/15: 5.3%)
Effective cost
management
Personnel and admin. expenses grew 2.0% in 2016, compared to IPCA of 6.3% in the last 12 months
• Disregarding labor claims, the expenses would have reduced 0.4% in 2016/2015, despite inflation
Efficiency Ratio for the last 12 months reached 38.8% in Dec/16 (Dec/15: 39.4%)
Executive summary
Highlights of results
3
Net Income of R$ 426M in 2016
119112108
8677
137146
122
+6.5%
4Q16 3Q16 2Q16 1Q16 4Q15 3Q15 2Q15 1Q15
R$482M R$426M
Consolidated results
Net Income (R$M)
4Q16 profit confirms the consistency
of Banco Votorantim’ s results
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]Net Interest Income (A) 1,098 1,172 1,072 -8.6% 4,702 4,641 -1.3%
ALL expenses¹ (B) (453) (492) (623) 26.7% (2,394) (2,079) -13.1%
Net Financial Margin (A+B) 645 681 449 -34.0% 2,308 2,562 11.0%
Operating Income/Expenses (543) (483) (575) 19.1% (2,276) (2,156) -5.3%
Income from Services and Banking Fees 266 281 321 14.6% 961 1,123 16.8%
Personnel and Administrative expenses (608) (547) (674) 23.2% (2,332) (2,378) 2.0%
Tax expenses (88) (87) (94) 7.7% (417) (372) -10.8%
Income from subsidiaries² 40 55 50 -9.0% 163 194 19.4%
Other Operating Income/Expenses (152) (184) (179) -3.0% (651) (724) 11.1%
Operating Income (Loss) 102 198 (126) - 32 406 -
Non-Operating Income (Loss) (2) 3 (8) - (29) 1 -
Income Tax and Profit Sharing (23) (89) 253 - 479 19 -96.1%
Net Income 77 112 119 6.5% 482 426 -11.6%
(R$ Million) 3Q16Var.
4Q16/3Q16
Var.
2016/2015201620154Q15 4Q16
Highlights of Results Consistent revenue generation, drop in credit provisions and cost base under control
Banco Votorantim continues advancing in the profitability of its
businesses, operational efficiency, and revenue diversification
Consolidated results
Managerial Income Statement (R$M)
1. Allowance for Loan Losses (ALL), net of revenues from recovery of written-off loans; 2. Subsidiaries accounted by the equity method
5
Consistent revenue generation Reduction in NII offset by the growth of income from services and insurance sales
NII decreased in 2016/2015, reflecting the
conservative approach to credit
Income from Services grew 17.3% in 2016,
reflecting the higher auto finance origination
Insurance
(Commission)
Services and
Fees
-8.6%
4Q16
1,072
3Q16
1,172
281 321
7464
+8.9%
4Q16
385
3Q16
354
-1.3%
2016
4,641
2015
4,702
214
256
961
+17.3%
2016
1,378
1,123
2015
1,175
3.5 3.8 12.4 13.3 5.1% 4.7% 4.9% 4.9% NIM¹ (% a.a.)
60.0 60.9 65.5 60.9
Revenues
Net Interest Income – NII (R$M) Income from Services, Fees and Insurance3 (R$M)
Auto finance
origination (R$B)
Average interest
earning assets (R$B)
1. Ratio between Net Interest Income and Average Interest-Earning Assets; 2. Includes guarantees provided and private securities;
3. Result of the stake in Votorantim Corretora de Seguros (insurance brokerage) is recognized using the equity method.
6
-7.1% +1.4%
Wholesale
Auto Finance
Payroll
Credit Cards
Dec/16
60.9
27.4
28.2
3.6 1.6
Sept/16
60.0
26.8
27.8
3.9 1.5
Jun/16
59.4
26.3
27.5
4.2 1.4
Mar/16
61.9
28.4
27.7
4.4 1.3
Dec/15
65.5
31.9
27.7
4.6 1.3
Maintenance of the conservative approach to credit Expanded credit portfolio of R$ 60.9B in Dec/16, growth of 1.4% compared to Sept/16
+2.4%
+1.3%
∆Dec16
/Sept16
-7.1% +9.7%
-14.1%
+1.6%
∆Dec16
/Dec15
-20.6% +26.4%
Credit portfolio by segment
Focus on profitability (vs. growth)
Expanded credit portfolio (R$B) (includes guarantees provided and private securities)
7
285 313 370
168 179
252
4Q16
623
3Q16
492
4Q15
453
Credit provision expenses reduced 13% in 2016/2015 90-day Coverage Ratio reached 140% in Dec/16
Credit provision expenses
reduced 13,1% in 2016/2015
90-day CR remains in a conservative level,
ending Dec/16 at 140%
140%127%
150%
Dec/16
2,638
3,684
Sept/16
2,567
3,267
Dec/15
2,923
4,387
90-day NPL balance (R$M)
Allowance for Loan Losses balance (R$M)
Wholesale
Consumer
Finance
-13.1%
2016
2,079
1,373
706
2015
2,394
1,316
1,077
+4.3%
-13.1%
∆2016
/2015
Credit indicators – ALL and 90-day Coverage
Credit provision expenses – ALL¹ (R$M) 90-day Coverage Ratio² (%) – Managed portfolio
90-day
Coverage
Ratio (CR)
1. Allowance for Loan Losses, net of income from recovery of written-off loans; 2. Ratio between the balance of ALL and the balance of loans past due over 90 days
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5.1%
5.50%
5.2%
5.54%
5.4%
5.74%
5.3%
5.62%
5.3%
5.67%
Banco
Votorantim
90-day NPL flat in the quarter, and 20bps lower than Dec/15 Auto Finance: delinquency declined to 5,1% in Dec/16 (Dec/15: 5,3%)
Wholesale
5.5% 5.5%
4.6% 4.6%
5.7%
Dec/16
5.6%
Sept/16
5.3%
Jun/16
2.0%
Mar/16
2.4%
Dec/15
5.8%
Consumer
Finance
Auto
Finance
Consumer
Finance
90-day market¹ NPL increased
40bps over the last 12 months
1. National Financial System. 90-day NPL obtained in the historical series released on the Central Bank website
Credit indicators – Delinquency
90-day NPL ratio of the managed loan portfolio (%)
9
Dec/16
1.3
1.3%
Jun/16 Dec/15
1.1
Jun/15 Dec/14
1.3
Jun/14 Dec/13
1.3
Jun/13 Dec/12
1.1
Jun/12 Dec/11
1.0
Jun/11 Dec/10
2.1
Jun/10 Dec/09
1.5
Lower quality vintages
Inad 30¹ (by vintage)
Used cars dealers
New cars dealers
Consumer Finance – Auto Finance
Participation in the portfolio
zeroed in Sept/16
Steady quality in auto finance origination has contributed
to the favorable trend in delinquency
1. First payment default, or % of each month’s production with first installment past due over 30 days
Auto finance: maintenance of quality in auto finance
origination, focusing on used cars
Auto Finance – Origination by channel (R$B) and first payment default by vintage – Inad 30¹ (%)
10
+6.9%
2016
13.3
10.9
(82%)
2.3
2015
12.4
10.3
(83%)
2.2
Used
Cars
Other
Vehicles¹
4Q16
3.8
3.1
0.6
3Q16
3.5
2.9
0.7
4Q15
3.1
2.6
0.6
Auto finance: continued focus on used cars and
maintenance of tight credit origination standards
Origination of auto loans (R$B)
Focus on used cars, which
represented 82% of 2016 origination Maintenance of conservative
lending standards
D Cars Market:
• New cars: -27%
• Used cars: -3%
+6.6%
+8.3%
∆2016
/2015 41% 41% 41%
454544
4Q16 3Q16 4Q15
Dec/16
26.2
Sept/16
26.7
Dec/15
29.3
Consumer Finance – Auto Finance
Down payment (%) and Average term (months)
Auto finance interest rate x Selic² rate (% p.y.)
Down payment
Average term
Banco Votorantim is one of the leading players
in the auto financing market
1. New cars, trucks and motorcycles Note: In Dec/16, the average ticket size was R$ 21,000, and the average vehicle age was 4.9 years (portfolio)
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303 283 304
226 217 236
79134
Administrative
Personnel - Other
Labor claims
4Q16
674
3Q16
547
47
4Q15
608
1. Excludes expenses with labor lawsuits Note: The IPCA price index reached 6.29% in the last 12 months.
Effective cost management Personnel and administrative expenses increased 2.0% in 2016, below inflation (IPCA of 6.3%)
916 883
294 347
+2.0%
2016
2,378
1,148
2015
2,332
1,123
+7.6%
+8.6%
∆4Q16
/3Q16
+2.3%
-3.6%
∆2016
/2015
Personnel
38.8 39.4 Efficiency ratio –
last 12 months¹ (%)
-0.4%
+186.5%
+18.1%
Personnel and administrative expenses (R$M)
Personnel and administrative expenses
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Net Income and Net Margin (post provisions) Personnel and Administrative expenses
11911277
449645 681
4Q16 3Q16 4Q15
Summary: Net Income of R$ 426M in 2016 Highlight to the Net Margin growth and effective cost base management
354 385
4Q16
1,457
1,072
3Q16
1,526
1,172
4Q15
1,419
1,098
321
303 283 304
305 264370
Admin.
Personnel
4Q16
674
3Q16
547
4Q15
608
285 313 370
168 179252
Consumer
Finance
Wholesale
4Q16
623
3Q16
492
4Q15
453
Net Margin Net income
+2.4%
2016
6,019
4,641
1,378
2015
5,877
4,702
1,175
+2.0%
2016
2,378
1,148
1,230
2015
2,332
1,123
1,210
-13.1%
2016
2,079
1,373
706
2015
2,394
1,316
1,077
426482
2016
2,562
2015
2,308
NII and Income from Services¹ and Insurance Credit provision expenses – ALL
Net Interest
Income
Services¹
and Insurance
1. Income from services and banking fees
Consolidated results
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Funding profile improved over the last years Bills and Credit Assignments account for 50% (R$ 34.3B) of the total funding sources
Bills (LF, LCA and LCI)
Loans securitized to
Banco do Brasil
Debentures (BV Leasing)
Sub Debt
Loans and onlendings
Time deposits (CD)
Securities abroad
Other¹
Dec/16
67.3
20.5
(30%)
13.8
(20%)
16.0
6.0
5.2 2.5 1.3
Sept/16
65.7
17.5
(27%)
13.2
(20%)
17.5
6.3
5.5 2.3 1.1
Dec/15
78.0
17.2
15.7
17.9
6.9
2.2
8.1
Dec/14
72.3
16.3
(23%)
7.9
17.4
6.2
6.7 2.4 6.6
15.2
(21%)
LF: R$17.6B
LCA and LCI: R$2.9B
12.9 13.2
244% 251%
Funding and Liquidity
Funding evolution (R$B)
High Quality Liquidity Assets (HQLA) (R$B)
Liquidity Coverage Ratio (LCR) – Pro Forma²
Additionally, Banco Votorantim has a stand-by credit
facility of ~R$ 7B from BB, which has never been tapped
1. Includes cash and interbank deposits; 2. Ratio of total high quality liquid assets (HQLA) and the total cash inflows for a 30 days period. Considers stand-by credit facility
with Banco do Brasil. Excluding it, the LCR regulatory reported the Central Bank in Dec/16 was 165% and the regulatory minimum of 70%.
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Total Capital 10,742 9,737 9,219
Tier I Capital 6,686 6,894 6,837
Common Equity Tier I 6,686 6,894 6,837
Additional Tier I - - -
Tier II Capital 4,056 2,843 2,382
Risk Weighted Assets (RWA) 70,549 61,626 61,207
Credit risk 62,926 56,871 55,922
Market risk 2,843 1,130 670
Operational risk 4,780 3,625 4,615
Minimum Capital Requirement 7,760 6,086 6,044
Basel Ratio (Capital/RWA) 15.2% 15.8% 15.1%
Tier I Capital Ratio 9.5% 11.2% 11.2%
Common Equity Tier I Ratio 9.5% 11.2% 11.2%
Additional Tier I Ratio - - -
Tier II Capital Ratio 5.7% 4.6% 3.9%
Sept.16 Dec.16BASEL RATIO
(R$ Million)Dec.15
Basel Ratio of 15.8% in Dec/16 Tier I Capital ratio of 11.2%, entirely composed of Common Equity
Capital structure
Note: In 2016, the minimum capital requirement was changed to 10.50% (11.00% in 2015), For Tier I Capital, it is 6.0% and for Principal Capital it is 4.5%.
15
Appendix
16
Banco Votorantim is one of the leading banks in Brazil “Top 10” in total assets, with strong shareholders and shared governance
Banco Votorantim is one of the largest
privately-held Brazilian banks in total assets...
Banco Votorantim – Overview
Shareholder
50% Total
10 largest Banks in Sept/16 - Total Assets (R$B)
...and also in terms of loan portfolio
81104
143
195665
955
Bradesco 1,062
CEF 1,231 Itaú 1,319
Banco do Brasil 1,483
Safra
BTG Pactual
Citibank Votorantim
Santander BNDES
10 largest Banks in Sept/16 – Loan Portfolio¹ (R$B)
National privately-held
State-owned
Foreign
29
44
47
47
246362
446
553
657
691
Santander
Safra
BTG Pactual
Votorantim
BNDES
Bradesco
Itaú
CEF
Banco do Brasil
Banrisul
State-owned
National privately-held
Foreign
1.On-balance loan portfolio according to Bacen’s Resolution 2,682.
Equal
representation
of each
shareholder Board of
Directors
Executive board
Fiscal
Council
Audit
Committee
Compensation
& HR
Committee
Products &
Marketing
Committee
Finance
Committee
Total: 50.00%
Voting: 49.99%
Non-voting: 50.01%
Total: 50.00%
Voting: 50.01%
Non-voting: 49.99%
Votorantim S.A. Banco do Brasil
Ownership Structure
Corporate Governance Structure
7th
9th
17
Banco do Brasil Votorantim S.A. +
R$ 60.9B
XX
Auto Finance
To originate portfolios with quality, scale and profitability
To focus on used auto finance (multi-brand dealers), where BV has a history of leadership and expertise
R$ 28.2B
Other Businesses
Payroll loans: to focus on
INSS (portfolio refinancing)
and Private (portfolio growth)
Credit Card, Insurance,
Student and Individual loans
and CrediCasa (home equity):
to leverage the existing client
base and diversify revenues
Other synergies with BB:
Promotiva, consortium, etc
R$ 5.3B
Consumer Finance R$ 33.5B
Corporate Bank
Business approach focused on long-term relationships
• Agility to serve
• Customer knowledge
Capital discipline
• Active portfolio management
Corporate bank: growth
• Leverage customer base
• Increase spread and cross-sell
Large Corporate: profitability
Wealth
Management
Asset: 9th largest in the market, with innovative products and growing synergies with BB
R$ 53.8B in AuM¹
Private: tailor-made solutions
Atacado
R$ 27.4B
Strategy
Diversified business portfolio Focus on increasing business profitability, operating efficiency and diversifying revenues
Shareholders
Pillars
1. Assets under management 2. Includes guarantees provided by the Bank and private securities
Expanded² credit portfolio
18
Consumer Finance Businesses
Used
New
Dec/16
28.2
24.7
(88%)
3.4
Sept/16
27.8
24.3
(87%)
3.5
Dec/15
27.7
23.7
(85%)
4.1
INSS
Private
Public
Dec/16
3.6
2.4
0.8
0.4
(12%)
Sept/16
3.9
2.6
0.8
0.5
Dec/15
4.6
3.1
0.8
0.7
(16%)
Consumer Finance businesses
Consumer Finance: increased focus on used auto
finance and INSS payroll loans (retirees and pensioners)
Payroll Loans Auto finance
Loan portfolio (R$B) Loan portfolio (R$B)
Among market leaders in auto financing, with the following
advantages:
• Capillarity: presence in ~12,000 car dealerships nationwide
• Agility: 83% of proposals with automatic credit decision
• Expertise: continuous improvement of management tools
(pricing, credit, collection etc.)
• Long-term relationship: first access to customer record
Focus on refinancing the INSS payroll loan portfolio
(retirees and pensioners)…
...and on increasing the private payroll loan portfolio
Selective operation in public payroll agreements
Continuous improvement of management tools
(pricing, credit, collection etc.)
19
9.4 (34%)
7.8 (29%)
5.4 (20%)
3.3 (12%)
0.6
0.8
Highlights and strategy Corporate Bank
Wholesale: continued focus on improving return on capital Leverage Corporate customer base, increasing spread and cross-sell
Wholesale Business (CIB)
1. Includes debentures and promissory notes; 2. Includes export credit notes, working capital and Loan Offshore; 3. Rural Financing e Advances on Exchange Contracts; 4. Ranking Anbima de Distribuição – Renda Fixa Consolidado (Dec/16)
Business approach focused on long-term relationships
• Deep customer knowledge
• Agility in the interaction with clients and market
Discipline in capital allocation
• Risk x return management
• Active portfolio management
Grow in Corporate bank (R$ 300M to R$ 1.500M)
• Leverage customer base
• Increase spread and cross-sell (FX, derivatives, DCM, M&A)
• Deconcentrate risk
Increase profitability in Large Corporate (ex: unfunded )
Explore competitive advantages, such as DCM:
Loans2
Onlending
(BNDES)
Financ Export / Import Other3
Guarantees provided
Private
Securities¹
Expanded credit
portfolio
R$ 27.4B
Diversified portfolio of
wholesale products 2016
1.8
2015
1.3
Local Fixed Income Distribution Ranking4
7th 6th
Wholesale business
Expanded credit portfolio (R$B and %)
Distributed
amount (R$B)
20
Dec.16/Sept.16 Dec.16/Dec.15
CURRENT AND LONG-TERM ASSETS 109,700 103,201 102,338 (0.8) (6.7)
Cash and cash equivalents 180 176 184 4.4 2.0
Interbank funds applied 17,187 17,093 17,116 0.1 (0.4)
Securities and derivative f inancial instruments 30,424 28,225 28,480 0.9 (6.4)
Derivative f inancial instruments 2,550 3,398 2,685 (21.0) 5.3
Interbank accounts or relations 72 330 341 3.1 -
Loan Operations, Leases and Others receivables 51,135 46,542 47,401 1.8 (7.3)
Alow ance for loan losses (4,148) (3,069) (3,671) 19.6 (11.5)
Tax credit 7,833 7,238 7,411 2.4 (5.4)
Others 4,466 3,268 2,391 (26.8) (46.5)
NON-CURRENTS 522 603 660 9.5 26.5
Investments 324 406 456 12.3 40.5
Fixed assets 97 90 98 8.2 0.8
Intangible and deferred charges 100 106 106 (0.2) 6.2
TOTAL ASSETS 110,221 103,804 102,998 (0.8) (6.6)
Dec.16/Sept.16 Dec.16/Dec.15
CURRENT AND LONG-TERM LIABILITIES 102,556 95,349 94,535 (0.9) (7.8)
Deposits 4,206 4,535 4,578 0.9 8.8
Demand deposits 81 60 88 45.5 8.2
Interbank deposits 1,933 2,153 1,997 (7.2) 3.4
Time deposits 2,192 2,322 2,492 7.3 13.7
Money market borrow ings 32,800 38,840 35,673 (8.2) 8.8
Acceptances and endorsements 25,323 18,661 21,802 16.8 (13.9)
Interbank accounts 83 103 100 (2.8) 19.8
Borrow ings and onlendings 7,893 5,454 5,203 (4.6) (34.1)
Derivative f inancial instruments 2,914 2,967 2,708 (8.7) (7.1)
Others obligations 29,337 24,790 24,471 (1.3) (16.6)
Subordinated debts 6,928 6,316 6,046 (4.3) (12.7)
Credit transactions subject to assignment 15,677 13,208 13,756 4.2 (12.3)
Others obligations 6,732 5,267 4,669 (11.3) (30.6)
DEFERRED INCOME 48 38 38 (1.9) (22.2)
SHAREHOLDERS’ EQUITY 7,617 8,416 8,426 0.1 10.6
TOTAL LIABILITIES 110,221 103,804 102,998 (0.8) (6.6)
BALANCE SHEET | Liabilities
(R$ Million)Dec.15 Sept.16 Dec.16
Variation %
BALANCE SHEET | Assets
(R$ Million)Dec.15
Variation %Sept.16 Dec.16
Balance Sheet
Balance Sheet
21
+13.4%
Dec/16
53.8
Sept/16
53.1
Jun/16
51.2
Mar/16
51.2
Dec/15
47.4
-6.6%
Dec/16
103.0
Sept/16
103.8
Jun/16
108.0
Mar/16
109.3
Dec/15
110.2
Financial highlights
-6.6%
Consumer
Finance
Wholesale
Dec/16
47.6
33.5
14.2
Sept/16
47.0
33.2
13.8
Jun/16
46.9
33.1
13.7
Mar/16
48.7
33.5
15.2
Dec/15
51.0
33.6
17.4
1. Includes onshore funds (ANBIMA criteria) and private clients resources. Note: Shareholders’ Equity includes the destination of dividends (R$ 101 million) in Dec/16.
+10.6%
Dec/16
8.43
Sept/16
8.42
Jun/16
8.28
Mar/16
8,08
Dec/15
7,62
Financial highlights
R$ Billion
Total Assets Assets under Management¹
Loan portfolio Shareholders’ Equity
22
Net Interest Income (A) 1,098 1,172 1,072 -8.6% 4,702 4,641 -1.3%
Average Interest-Earning Assets (B) 98,020 93,721 93,112 -0.6% 95,350 95,363 0.0%
Compulsory Deposits (Bacen) 24 458 335 -26.7% 38 334 -
Interbanks Funds Applied 16,689 18,474 17,105 -7.4% 14,740 17,656 19.8%
Securities 30,258 27,842 28,352 1.8% 28,243 29,141 3.2%
Loan Portfolio 51,049 46,947 47,319 0.8% 52,329 48,232 -7.8%
NIM (A/B) 4.6% 5.1% 4.7% -0.4 p.p. 4.9% 4.9% 0.0 p.p.
2015 2016NET INTEREST MARGIN (NIM)
(R$ Million)3Q164Q15 4Q16
Var.
4Q16/3Q16
Var.
2016/2015
Net Interest Margin (NIM)
Financial highlights – NIM
23
Total Personnel¹ and Administrative expenses (A) 529 500 541 8.0% 2,039 2,031 -0.4%
Total Revenues (B) 1,252 1,323 1,264 -4.5% 5,174 5,234 1.2%
Net Interest Income (NII) 1,098 1,172 1,072 -8.6% 4,702 4,641 -1.3%
Income from Services and Banking Fees 266 281 321 14.6% 961 1,123 16.8%
Income from subsidiaries² 40 55 50 -9.0% 163 194 19.4%
Other Operating Income/Expenses (152) (184) (179) -3.0% (651) (724) 11.1%
Efficiency Ratio (A/B) - period 42.3% 37.8% 42.8% 5.0 p.p. 39.4% 38.8% -0.6 p.p.
Efficiency Ratio - last 12 months 39.4% 38.7% 38.8% 0.1 p.p. 39.4% 38.8% -0.6 p.p.
2016Var.
2016/2015
EFFICIENCY RATIO (ER)
(R$ Million)4Q15 3Q16 4Q16
Var.
4Q16/3Q162015
Efficiency Ratio
Financial highlights - ER
1. Excludes expenses with labor lawsuits; 2. Subsidiaries accounted by the equity method
24
Dec/16
3,684
7.7%
3,671
13
Sept/16
3,267
6.9%
3,069
198
Jun/16
3,221
6.9%
2,989
232
Mar/16
3,271
6.7%
3,046
225
Dec/15
4,387
8.6%
4,152
235
All balance / Managed loan portfolio
Specific + Additional
Generic²
1. According to Bacen’s Resolution 2,682; 2. Considers credit provisions recognized as Liabilities in the "Other“ line (see Note #18d of Financial Statements)
Credit quality indicators
AA-C
D-H
Dec/16
88.3%
11.7%
Sept/16
90.2%
9.8%
Jun/16
90.2%
9.8%
Mar/16
90.6%
9.4%
Dec/15
88.8%
11.2%
197141 140 176
262
469624639693
4Q16 3Q16 2Q16 1Q16
1,215
4Q15
495 500 448207
4Q16
1.7%
3Q16
3.9%
2Q16
4.3%
1Q16
9.1%
1,074
4Q15
3.9%
Net Loss/Managed loan portfolio Net Loss Write-off Credit Recovery
Credit portfolio
ALL Balance (R$M) Managed loan portfolio rated by risk level¹ (%)
Credit Recovery (R$M) Net Loss (R$M)
25
Managed Loan Portfolio (A) 60,539 58,281 56,806 55,712 55,231 55,422 52,505 51,576 51,250 48,799 46,925 47,031 47,620
90-day NPL Balance 3,081 3,563 3,662 3,273 3,154 3,628 2,727 2,712 2,923 2,254 2,174 2,567 2,638
90-day NPL Quarterly Variation (B) -292 482 99 (388) (119) 474 (902) (14) 211 (669) (80) 393 71
Write-off (C) 869 874 857 771 666 578 834 838 693 1,215 639 624 469
New NPL (D=B+C) 578 1,356 955 383 547 1,052 (67) 823 903 546 560 1,017 540
New NPL Rate¹ (D/A) 0.94% 2.24% 1.64% 0.67% 0.98% 1.90% -0.12% 1.57% 1.75% 1.07% 1.15% 2.17% 1.15%
4Q162Q14NEW NPL
(R$ Million)4Q13 1Q14 3Q161Q16 2Q163Q14 4Q14 1Q15 2Q15 3Q15 4Q15
1.15%
2.17%
1.15%
1.07% 1.75%
1.57%
-0.12%
1.90%
0.98%
0.67%
1.64%
2.24%
0.94%
4Q16
0.47 0.54
3Q16
0.62
1.02
2Q16
0.64 0.56
1Q16
1.22
0.55
4Q15
0.69 0.90
3Q15
0.84 0.82
2Q15
0.83
-0.07
1Q15
0.58
1.05
4Q14
0.67 0.55
3Q14
0.77
0.38
2Q14
0.86 0.96
1Q14
0.87
1.36
4Q13
0.87
0.58
New NPL rate
1. Variation in the balance of 90-day NPL balance + loans written-off to loss in the quarter, divided by loan portfolio by the end of the immediately preceding quarter
New NPL
rate¹
Write-off (R$B)
New NPL (R$B)
Credit portfolio
26
Wholesale has a diversified credit portfolio Top 20 sectors account for 86% of the Wholesale credit exposure
Credit portfolio
1. Numbers exclude private securities and are net of credit provisions. Note: Does not consider application of Credit Conversion Factor of 50% in transactions relating to
some specific guarantees provided.
R$M Part.(%) R$M Part.(%) R$M Part.(%)
Financial Institutions 5,229 21.3% 4,133 20.1% 4,523 21.9%
Sugar and Ethanol 2,252 9.2% 1,996 9.7% 1,831 8.9%
Telecom 1,675 6.8% 1,624 7.9% 1,633 7.9%
Petrochemical 1,684 6.8% 1,575 7.7% 1,395 6.8%
Retail 1,313 5.3% 945 4.6% 1,332 6.5%
Mining 1,006 4.1% 861 4.2% 891 4.3%
Railways 771 3.1% 775 3.8% 723 3.5%
Agribusiness 1,001 4.1% 768 3.7% 710 3.4%
Eletricity Generation 683 2.8% 591 2.9% 542 2.6%
Automotive 404 1.6% 450 2.2% 539 2.6%
Government 705 2.9% 573 2.8% 525 2.5%
Electricity Distribution 461 1.9% 420 2.0% 419 2.0%
Residential Construction 522 2.1% 415 2.0% 416 2.0%
Oil & Gas 401 1.6% 401 2.0% 401 1.9%
Road Cargo Transportation 533 2.2% 467 2.3% 372 1.8%
Pulp and Paper 755 3.1% 357 1.7% 355 1.7%
Steel industry 189 0.8% 270 1.3% 311 1.5%
Slaughterhouses 284 1.2% 263 1.3% 258 1.3%
Food industry 215 0.9% 330 1.6% 245 1.2%
Services 414 1.7% 289 1.4% 232 1.1%
Other sectors 4,106 16.7% 3,029 14.8% 2,958 14.3%
Total¹ 24,604 100.0% 20,532 100.0% 20,614 100.0%
Wholesale
Sectorial concentration
Dec.15 Sept.16 Dec.16
27
Banco Votorantim’ s main ratings
Ratings
RATING AGENCIES International National
Local Foreign Local
Moody’s
Long-term Ba2 Ba3 Aa3.br
Short-term NP NP BR-1
Standard & Poor’s
Long-term BB brA+
Short-term B brA-1
Brazil
Sovereign rating
Ba2
BB