Banking in CEE – Despite some headwinds, it is worthwhile
2015 Euromoney CEE Forum – Vienna, January 21st 2015
Gianni Franco Papa, Group Deputy General Manager, Head of CEE Division and CIB Division
Carmelina Carluzzo, Deputy Head of CEE Strategic Analysis
CEE Banking Outlook 2015
CEE remains a diverse Region. Cross-country differentiation is a key feature. This year, economic
growth in CESEE is likely to keep a similar pace as in 2014, at 2.5%, with CE outperforming SEE
(2.8% vs 1.6%). Taking CEE as a whole, GDP evolution will be affected by a contraction in Russia.
Cross-country differentiation is also observable in banking sector developments, with some
important positive features:
o While overall lending growth has remained weak, some countries showed
encouraging trends.
o Some of the past vulnerabilities are being addressed as external liabilities(1) in CESEE
have been replaced by domestic funding, mainly deposits and capital.
Looking forward, a slight acceleration in lending growth in CESEE is likely to be visible in
2015, mainly driven by corporate lending. For CEE as a whole, lending growth will be affected by
a significant deceleration in Russia. Differentiation across countries will remain a key feature.
With margins remaining under pressures, banks will increasingly look for wider range of
opportunities to improve their revenue generation capacity. Non-interest income - fees and
commissions - will therefore play a relevant role. Cost efficiency will remain important.
CEE banking sector in 2015 is expected to keep its profitability ratio – RoA – comparable to
2014, at around 1.0%, with NPL likely to remain a challenge. Geopolitical developments as well as
changes in the external environment represent a source of uncertainty for the overall outlook.
2
Note: CEE (Central Eastern Europe) includes Bosnia, Bulgaria, Croatia, Czech Republic, Hungary, Poland, Romania, Russia, Serbia, Slovakia, Slovenia,
Turkey, Ukraine; CESEE (Central Europe and South Eastern Europe) is CEE excluding Russia, Turkey and Ukraine; CE includes Czech Republic,
Hungary, Slovakia, Slovenia, Poland; SEE includes Bosnia, Bulgaria, Croatia, Romania, Serbia.
(1) External liabilities correspond to financing from non-residents, mainly including parent banks‘ funding
3
Agenda
UniCredit - confirms commitment to CEE
CEE Banking Trends - some strengths under uncertainty
Country Cards
CEE Banking Outlook - it is worthwhile
CEE remains a diverse Region
Real GDP growth, % Real GDP growth by country, %
0.4
-2.1
-0.7
1.5
2.5
0.0
3.3
2.3
2.72.3
3.32.9
-3.4
-0.7
-0.2
1.82.0
2.32.42.52.5
3.33.4
1.5
UA
-4.6
-6.7
RU RS HR BG SI BH HU CZ RO SK PL TR
2015 F 2014 E
1.4
2.92.52.5
5.0
4.0
3.0
2.0
1.0
-1.0
-2.0
-3.0
-4.0
-5.0
-6.0
2016F
2.2
2015F
0.2
2014E 2013 2012 2011 2010 2009 2008
CESEE CEE
SOURCE: UniCredit Research, UniCredit CEE Strategic Analysis 4
Lending growth fatigue?
CEE - Total gross loans growth, % yoy (1)
11.3
2.1
-5
0
5
10
15
20
Dec-10 Dec-11 Dec-12 Dec-13
CEE CESEE
Oct-14
SOURCE: UniCredit CEE Strategic Analysis
(1) Local currency terms, FX end-2013 constant
5
Cross-countries picture shows differentiation, with a few nice spots
CEE Total lending growth by country (latest data Oct-14), % yoy (1)
TR and RU fast growth but
with decelerating trend
Some countries with
accelerating trend…
… while others still with loans
contracting
-10
-5
0
5
10
15
20
25
30
35
40
Dec-10 Dec-11 Dec-12 Dec-13
TR RU
-5
-3
-1
1
3
5
7
9
11
13
15
Dec-11 Dec-12 Dec-13
CZ SKRS BHBG PL
-25
-20
-15
-10
-5
0
5
10
15
Dec-10 Dec-11 Dec-12 Dec-13
HU SIRO HRUA
SOURCE: UniCredit CEE Strategic Analysis
(1) FX loans are adjusted for movements in the exchange rate
6
Oct-14 Oct-14 Oct-14
While FX retail lending growth is negative in a few SEE countries, local
currency retail lending shows a positive dynamics
-4
-2
0
2
4
6
8
10
12
14
16
HR RO BG
-12
-10
-8
-6
-4
-2
0
2
4HR RO BG
SOURCE: UniCredit CEE Strategic Analysis
LC retail loans growth, % yoy FX retail loans growth, % yoy
7
Other
9
Capital
56
External
liabilities
-34
Debt
issued
15
Deposits
167
Total
Assets
213 Change in 2014
Change 2008-2013
CESEE - Change in funding sources (1)
Funding model more sustainable
9698102107107105107
Sep-14 2013 2012 2011 2010 2009 2008
13.613.713.512.512.311.810.3
Sep-14 2013 2012 2011 2010 2009 2008
Loans/Deposits ratio, %
8
Change in funding sources, 2008-2014(2), EUR bn
SOURCE: UniCredit CEE Strategic Analysis
(1) Local currency terms, FX end-2013 constant. Other include deposits from MFIs and other liabilities. BG as of Jun-14 for Sep-14; (2) Latest 2014 data as of
Sept-14; (3) External liabilities correspond to financing from non-residents, mainly including parent banks’ funding
Ext. Liabilities/Tot. Assets ratio, %
13.514.014.917.718.618.821.0
Sep-14 2013 2012 2011 2010 2009 2008
Equity/Tot. Assets ratio, %
(3)
(2)
9
Agenda
UniCredit - confirms commitment to CEE
CEE Banking Trends - some strengths under uncertainty
Country Cards
CEE Banking Outlook - it is worthwhile
Gross loans growth, % yoy (1)
14.1
3.42.6
-5
0
5
10
15
20
2015F 2014E 2013 2012 2011 2010
9.3
Slight acceleration in lending growth ahead in CESEE…
3.3
4.13.9
-5
0
5
10
15
20
2015F 2014E 2013 2012 2011 2010
5.4
9.7
Total Loans Corporate Loans
18.2
3.5
0.5
-5
0
5
10
15
20
2015F 2014E 2013 2012 2011 2010
12.4
Retail Loans
CESEE HU adj.**
CESEE
CEE
SOURCE: UniCredit CEE Strategic Analysis
(1) Local currency terms, FX end-2013 constant; (2) CESEE HU adj. excludes the estimated impact of the conversion scheme
(2)
10
Loans growth, % yoy (1)
…with differentiation across countries
2.6
14.1
-0.7-3.6
15.5
0.8
-1.5
-9.3
3.52.85.66.36.1
22.2
16.1
3.4
9.3
-5.0
0.10.70.81.02.02.83.73.94.06.5
10.9
16.7
CESEE CEE HU RO UA BG HR SI BH CZ SK RS PL RU TR
2015F 2014E
5.3
9.6
2.93.00.2
5.62.2
10.4
6.13.03.6
6.28.0
14.4
9.1
4.2
9.1
0.83.0
0.22.21.51.4
3.93.23.14.9
6.9
11.2
15.0
CESEE CEE HU RO UA BG HR SI BH CZ SK RS PL RU TR
2015F 2014E
Deposits growth, % yoy (1)
120 113 104 135 91 69 111 101 116 88 158 94 97
xxx L/D ratio 2015F, %
SOURCE: UniCredit CEE Strategic Analysis
(1) Local currency terms, FX end-2013 constant
11
Corporate lending accelerating overall faster than retail lending
0.5
18.2
-5.6
0.9
-0.5
17.1
0.50.8
-15.0
-0.2-0.5-1.8
7.6
26.020.6
3.5
12.4
-0.8
0.50.71.01.81.92.02.03.03.18.0
14.518.9
CESEE CEE RO BG SK UA HU BH SI HR CZ RS PL RU TR
2015F 2014E
3.9
9.7
-2.1
0.3
11.411.0
-2.7
5.5
-1.8-0.8
3.97.35.9
18.0
7.03.3
5.41.01.3
6.9
0.0
-13.6
3.62.0
-0.4
4.54.86.05.0
12.5
CESEE CEE RO BG SK UA HU BH SI HR CZ RS PL RU TR
2015F 2014E
(1) Local currency terms, FX end-2013 constant; (2) CESEE HU adj. excludes the estimated impact of the conversion scheme
Corporate loans growth, % yoy (1)
Retail loans growth, % yoy (1)
12
4.1(2)
SOURCE: UniCredit CEE Strategic Analysis
Revenues margins are expected to remain under pressure. Non-NII
revenues therefore to be a key profitability driver
Share of non-interest revenues, 2015F % (1)
5.3
3.63.7
1.91.8
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
5.5
6.0
6.5
2012 2011 2010 2009 2008 2015F 2014E 2013
4.7
Revenues / Avg. Assets, % (1)
13
69.3%
30.7%
NII
Non-NII
CEE
65.6%
34.4%
CESEE
61.2%
38.8%
AT, DE, IT(2)
(1) Revenues exclude all one-off effects in Hungary. AT, DE and IT revenue share as per 2013; (2) Austria (AT), Germany (DE) and Italy (IT)
SOURCE: UniCredit Group Strategic Planning, UniCredit CEE Strategic Analysis
CEE AT, DE, IT CESEE (2)
Cost efficiency will continue to be an important contributor to
profitability…
SOURCE: UniCredit Group Strategic Planning, UniCredit CEE Strategic Analysis
47.7
52.651.9
60.4
62.3
40
50
60
70
2015F 2014E
47.6
2013 2012 2011 2010 2009 2008
14
Costs / Income ratio, % Costs / Avg. Assets, %
CEE
AT, DE, IT
CESEE
2.52
1.881.93
1.121.12
1.0
1.5
2.0
2.5
3.0
3.5
2.26
2009 2013 2015F 2010 2008 2014E 2012 2011
Country 2013 2014 E 2015 F
Ukraine 23.5% 30.0% 34.0%
Serbia 20.7% 24.0% 23.0%
Russia 12.7% 18.0% 21.0%
Bulgaria 16.9% 18.9% 20.7%
Hungary 21.2% 20.5% 19.5%
Croatia 15.6% 18.0% 18.9%
Slovenia 19.9% 20.6% 18.9%
Bosnia-H. 15.1% 17.0% 17.5%
Romania 32.1% 14.4% 11.4%
Poland 7.6% 7.3% 6.9%
Czech R. 6.1% 6.3% 6.1%
Slovakia 5.3% 5.4% 5.3%
Turkey 2.6% 3.0% 3.2%
CEE 11.2% 12.3% 13.7%
CESEE 10.8% 10.9% 10.5%
15
…while NPLs likely to remain a challenge
Non Performing Loans ratio, % (1)
13.7
12.3
10.510.9
2.42.9
1.21.3
2015F 2014E 2013 2012 2011 2010 2009
CESEE - CoR CESEE - NPLs
CEE - CoR CEE - NPLs
NPL ratio by country, % (1)
SOURCE: UniCredit CEE Strategic Analysis
(1) NPL definition varies across countries. In this slide CEE/CESEE aggregates exclude also Romania because of methodological changes in the NPL
calculation in 2014; (2) Romania NPL ratio time series not consistent between 2013 and 2014 because of a methodological change in the calculation of NPL in
2014; (3) Provisions exclude all one-off effects in Hungary
(2)
(3)
(3)
Return on Assets (RoA) (1), % Return on Assets (RoA) (1) by country, %
-1.2
-0.5
0.1
-0.6
0.50.60.6
1.0
1.31.31.3
1.8
-1.0
0.00.1
0.30.4
0.60.60.6
0.9
1.1
1.31.3
1.8
UA SI RS RO HU
-1.8
HR BH BG RU PL CZ SK TR
2015 F 2014 E
1.04
0.90
0.44
0.33
2.0
1.8
1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
2015F 2014E 2013 2012 2011 2010 2009 2008
0.88
0.59
0.98
AT, DE, IT CESEE
CESEE HU adj. CEE
16
Overall, RoA comparable to 2014 in most of the countries with Romanian,
Slovenian and Hungarian banking systems turning back to profit
(2)
(1) RoA is calculated as Profit before Tax divided by average Assets; (2) RoA excluding all one-off effects in Hungary
SOURCE: UniCredit Group Strategic Planning, UniCredit CEE Strategic Analysis
Downside Risks
Increase of geopolitical tensions
Deterioration of the economic growth
outlook for the euro area
Lower oil prices for Russia
Upside Risks
Lower oil prices to boost households
and companies spending power
More accommodative monetary policies
Efforts towards a greater harmonization
of financial services regulations
CEE Banking Sector Outlook – downside/upside risks
17
18
Agenda
UniCredit - confirms commitment to CEE
CEE Banking Trends - some strengths under uncertainty
Country Cards
CEE Banking Outlook - it is worthwhile
UniCredit is a rock-solid European commercial bank
Strong positioning in CEE2:
#1 in CEE Region in terms network – over 68,000 employees and more than 3,400 branches –
and expertise
Strong contribution to Group profitability – Operating income in CEE: EUR 4,313 mn;
Operating profit in CEE: EUR 2,481 mn
Ranked among the top five banks in 9 CEE3 countries
Total Customers loans in CEE ~ EUR 85 bn; Total Customers deposits in CEE ~ EUR 80 bn
1. Data as at September 30, 2014. Number of employees counted for the rate of presence. Figures include employees of Koç Financial Group calculated at 100%.
2. Including direct and indirect presence in the following countries, excluding representative offices: The figures include: Azerbaijan, Bosnia & Herzegovina, Bulgaria, Czech Republic, Croatia,
Hungary, Poland, Romania, Russia, Serbia, Slovenia, Slovakia, Turkey, Ukraine
3. Market share in terms of total assets 2Q 2014.
Source: company data
19
International network in approx. 50 countries, with around 8,600 branches and more than
148,000 employees1
Operating income: EUR 16,863 mn; Operating profit: EUR 6,531 mn
Common Equity Tier I ratio at 10.73%
Comprehensive Assessment results proved UniCredit's solid capital position. 2016 CET1 under
the stress test adverse scenario is 6.8%.
Data as of YTD 9M '14
20
UniCredit maintains a leadership position in CEE…
Countries of
presence (3)
Total Assets (1)
EUR bn Number of
Branches
116 1,299 3,927 19
6
4
11
9
15
19
14
1,475
991
2,494
1,843
2,920
2,488
Data as of
1H 2014
CEE, % share in
Group revenues
n.m.
10
14
55
84
25
OTP 33
ISP 37
KBC 57
SocGen 73
Erste 77
RBI 80
UniCredit 142
(5)
81
-480
173
353
199
380
902
Net Profit (2)
EUR mn
(6) (7) (7)
Note: (1) 100% of total assets for controlled companies (stake > 50%) and pro rata for non- controlled companies (stake < 50%), except for OTP; (2) After tax and before minorities; (3)
Including direct and indirect presence in the 25 CEE countries, excluding representative offices; (4) including branches in Turkey at 100%; (5) Results of RBI exclude group corporate,
markets and corporate center segments; (6) BG, HR, MG, MD and MC as of FY2013 since 1H 2014 data not available; (7) Excluding BG, HR, MG, MD and MC since 1H 2014 data not
available. (8) As of FY2013
SOURCE: UniCredit CEE Strategic Analysis
1,475
991
771
2,494
1,843
2,920
3,495
28 (8)
(4)
Poland
10.5% market share
1,001 branches #2
Baltics
Leasing
Russia
1.5% market share
108 branches #9
Azerbaijan
16 branches
Ukraine
3.6% market share
309 branches #6
Bulgaria
15.2% market share
202 branches #1
Turkey
9.1% market share
978 branches #5
Czech Republic
8.7% market share
106 branches #4
Slovakia
6.5% market share
78 branches #6
Hungary
6.4% market share
85 branches #6
Slovenia
7% market share
33 branches #5
Croatia
26.6% market share
137 branches #1
Bosnia and Herzegovina
21.5% market share
122 branches #1
Romania
7.2% market share
185 branches #5
Serbia
9.1% market share
73 branches #3
Rep. Office in
FYR Macedonia
and
Montenegro
Market shares in terms of total assets 2Q 2014, according to local accounting standard, unconsolidated figures (Bosnia & Herzegovina, Bulgaria, Czech Republic, Hungary, Russia,
Serbia, Turkey, Ukraine) local accounting standard, consolidated figures (Croatia), IFRS (Poland, Romania, Slovakia, Slovenia). Croatia and Hungary includes mortgage bank.
Data as of June 30th, 2014, except Hungary (FY2013) and Romania (1Q14)
Branches: data as at 30 September 2014. Bosnia & Herzegovina includes UniCredit Bank Banja Luka. Azerbaijan includes Yapi Kredi branches.
Source: UniCredit CEE Strategic Analysis
… with a strong footprint in the Region
21
UniCredit has a strong focus on customer proximity
Corporate and
Investment
Banking
Retail Banking
Private Banking
International clients: more than 20,000 international clients
operating in CEE supported by UniCredit International
Centers Network
EU Subsidized Finance: leadership in EU Funds business
Global Investment Strategy (GIS): a unique global
independent investment philosophy
Preferred Partners (PP): selection of best-in-class
Investment Funds
Alternative channels: cutting edge banking applications and
internet banking platform
Innovation: enhance digital banking and platform for
consumer finance (mobile payments, touchless biometric
payments, etc.) and enlarge market potential
22
Latest Awards acknowledge our consistent performance
Euromoney - Award for Excellence
•Best Bank in Bosnia & Herzegovina 2013
•Best Cash Management House in CEE 2013
•Best Project Finance House in CEE 2013
Global Finance
•Best Overall Bank for Cash Management in CEE
2013, 2014 & 2015
•Best Bank for Payments & Collections in CEE 2013
•Best Bank for Liquidity Management in CEE
•Best Bank in Bulgaria 2013
Global Finance
•Best Trade Finance Bank CEE 2013, 2014 & 2015
•Best Trade Finance Bank in Bulgaria in 2013, 2014&
2015, in Croatia in 2015, in Czech Republic in 2013, 2014 &
2015, Russia in 2013, in Ukraine in 2013, 2014 & 2015
•Best Supply Chain Finance Provider in CEE 2013 &
2014
Trade & Forfaiting Review
•Best Trade Bank in CEE 2013
Global Finance
•Best Sub-Custodian Bank in CEE 2013 & 2014
•Best Sub-Custodian Bank in Bulgaria in 2014, in
Croatia in 2013, in Czech Republic in 2013 & 2014, in
Hungary in 2013 & 2014, in Poland in 2013 & 2014, in
Slovakia in 2013, in Slovenia in 2014, and Ukraine in
2013 & 2014
emeafinance
•Best Project Finance Adviser in CEE 2013
EuroWeek
•Best Sub-Custodian Bank in Croatia, Czech
Republic, Hungary, Poland, Slovakia and
Ukraine in 2013
Best Cash Management House in
Bosnia Herzegovina, Croatia, Czech Republic,
Poland, Romania, Serbia and Slovenia in 2013
tmi
•Best Bank in Trade Finance in Eastern
Europe 2013
•Best Bank for Financial Supply Chain
Management – Central and Eastern Europe
2014
Euromoney - PB Survey
• Best Range of Investment Products
Czech Republic 2014
• Best Corporate Advisory for PB Clients
Hungary 2014
• Best PB Services Overall 2014
Financial Times and Merger market
M&A Awards
Financial Advisor of the Year in CEE 2013
•Best Trade Finance Provider in CEE
•Best Trade Finance Provide in Bosnia
Herzegovina, Bulgaria, Croatia, Czech Republic,
Hungary, Poland, Romania, Russia, Serbia,
Slovakia, Turkey in 2015
23
Eastern Europe Syndicated Loans EUR-Den. (All Asset Classes)
Pos Bookrunner Deal Value
(EUR mn)
No. Share*
%
1 ING 1,238 18 5.4
2 UniCredit 1,037 14 4.5
3 Citi 836 12 3.7
4 Deutsche Bank 813 10 3.6
5 Société Générale CIB 698 8 3.1
6 RBS 593 4 2.6
7 Standard Chartered Bank 417 13 1.8
8 Commerzbank Group 407 11 1.8
9 HSBC 399 10 1.7
10 Wells Fargo Securities 350 9 1.5
Total 22,910 84 100.0
Period: 1 Jan – 31 Dec 2014; Source: Dealogic Loanware, per 7 Jan 2015
* Bookrunner market share is a proportion of bookrunner-led loan volume only
24
Project Finance in Eastern Europe
Pos Mandated Arranger Deal Value
(EUR mn)
No. Share
%
1 UniCredit 672 11 12.0
2 ING Groep NV 644 8 11.5
3 Société Générale CIB 349 4 6.2
4 Crédit Agricole SA 345 4 6.2
5 Sberbank of Russia OAO 293 2 5.2
6 BNP Paribas SA 261 5 4.7
7 Citigroup Inc 248 2 4.4
8 Raiffeisen Zentralbank Oesterreich AG 243 3 4.3
9 Bank of China Ltd 198 1 3.5
9 Royal Bank of Scotland Group plc 198 1 3.5
9 VTB Bank OAO 198 1 3.5
Total 5,593 22 100.0
Period: 1 Jan – 31 Dec 2014; Source: Dealogic ProjectWare, per 7 Jan 2015
All Eastern European Bonds in EUR
Pos Bookrunner Deal Value
(EUR mn)
No. Share
%
1 Société Générale CIB 3,314 13 11.2
2 JPMorgan 3,025 12 10.2
3 UniCredit 2,938 16 9.9
4 Citi 2,780 15 9.4
5 Deutsche Bank 2,362 12 8.0
6 HSBC 2,234 8 7.5
7 Barclays 1,872 9 6.3
8 BNP Paribas 1,706 11 5.8
9 Erste Group Bank AG 1,028 6 3.5
10 Commerzbank Group 931 7 3.1
Total 29,636 47 100.0
Period: 1 Jan – 31 Dec 2014; Source: Dealogic Analytics, per 5 Jan 2015
Financial Advisors to CEE* M&A by No. of Deals
Pos Financial Advisors Deal Value
(EUR mn)
No.
1 KPMG 1,422 25
2 Deloitte 588 17
3 UniCredit 2,674 16
4 Citi 5,087 14
4 PwC 642 14
4 EY 521 14
7 Sberbank CIB 10,373 13
8 VTB Capital ZAO 5,892 12
8 Rothschild 2,027 12
10 3 Seas Capital Partners 10 11
Period: 1 Jan – 31 Dec 2014; Source: Mergermarket, per 7 Jan 2015
* incl. Russia, Turkey, Poland
For some businesses we are among top players in the Region
25
Going forward – Focus on customer and business development
Building on our achievements, we aim to further strengthen our position in the CEE Region
also scouting for selected inorganic opportunities, keeping our strong focus on
customer proximity and leveraging on our strong geographical footprint and expertise.
Taking into consideration today's demanding and rapidly changing economic environment,
since July 2013 the Group - within the framework of 2013-2018 Strategic Plan - has launched
CEE2020, the Program aimed at developing new ways to generate growth and value creation.
The objective is to create the proper environment for a healthier CEE Division that will
continue to deliver sustainable results well into the future.
Strategic initiatives include:
Retail: Product and process simplification, alternative channels enhancement
CIB: Capital light model, International clients ad hoc offering and SME's value
proposition
PB: Need Based Advisory and Investment Advisory 2.0
26
Agenda
UniCredit - confirms commitment to CEE
CEE Banking Trends - some strengths under uncertainty
Country Cards
CEE Banking Outlook - it is worthwhile
27 SOURCE: UniCredit Research, UniCredit CEE Strategic Analysis, UniCredit CEE Banking Network
CEE Country Data – 1/7
Bosnia-H. 2011 2012 2013 2014E 2015F Bulgaria 2011 2012 2013 2014E 2015F
Real GDP, % yoy 1.0 -1.2 2.1 0.0 2.0 Real GDP, % yoy 2.0 0.5 1.1 1.5 1.5
Inflation, % avg 3.7 2.1 -0.1 -0.8 1.6 Inflation, % avg 4.2 3.0 0.9 -1.4 -0.5
1M Euribor 1.02 0.11 0.22 0.02 0.02 Reference rate, eop (%) - - - - -
Loans (yoy %) 5.3 4.1 2.9 3.5 2.8 Loans (yoy %) 3.4 2.3 0.1 0.8 0.8
Loans ( % GDP) 59.4 61.9 62.4 65.0 64.5 Loans ( % GDP) 71.4 70.5 70.5 71.1 69.9
Deposits (yoy %) 3.8 2.4 7.0 6.1 3.9 Deposits (yoy %) 12.4 7.6 8.9 5.6 2.2
Deposits ( % GDP) 50.3 51.6 54.2 57.8 58.0 Deposits ( % GDP) 66.9 69.4 75.6 79.8 79.5
Loans to Deposits Ratio (%) 118.0 119.9 115.2 112.4 111.3 Loans to Deposits Ratio (%) 106.8 101.6 93.3 89.1 87.9
External Liabilities (% of total liabilities) 19.1 17.7 16.6 13.8 13.1 External Liabilities (% of total liabilities) 16.4 16.6 14.1 12.8 12.2
Cost to Income Ratio (%) 67.6 67.4 71.7 67.9 67.6 Cost to Income Ratio (%) 50.0 52.0 53.5 49.7 47.6
Revenues/avg. Volumes (%) 4.4 4.2 4.0 3.9 3.8 Revenues/avg. Volumes (%) 3.9 3.6 3.3 3.5 3.5
Return on Assets (%) 0.8 0.7 -0.1 0.6 0.6 Return on Assets (%) 0.9 0.8 0.8 0.6 0.6
Impaired loans ratio (% gross loans) 11.8 13.5 15.1 17.0 17.5 Impaired loans ratio (% gross loans) 14.9 16.6 16.9 18.9 20.7
Cost of Risk (%) 1.5 1.5 2.2 1.5 1.5 Cost of Risk (%) 2.5 2.2 2.0 2.7 2.9
28
CEE Country Data – 2/7
SOURCE: UniCredit Research, UniCredit CEE Strategic Analysis, UniCredit CEE Banking Network
Croatia 2011 2012 2013 2014E 2015F Czech Republic 2011 2012 2013 2014E 2015F
Real GDP, % yoy -0.3 -2.2 -0.9 -0.7 -0.2 Real GDP, % yoy 2.0 -0.7 -0.7 2.3 2.4
Inflation, % avg 2.3 3.4 2.2 0.0 0.7 Inflation, % avg 1.9 3.3 1.4 0.4 1.2
1W money market rate eop 1.18 0.74 0.53 0.60 0.90 Reference rate, eop (%) 0.75 0.05 0.05 0.05 0.05
Loans (yoy %) 6.0 -2.4 0.8 -1.5 1.0 Loans (yoy %) 5.3 2.4 3.5 2.8 3.7
Loans ( % GDP) 86.5 85.0 85.7 85.0 85.5 Loans ( % GDP) 53.1 54.0 55.3 54.2 53.7
Deposits (yoy %) 1.6 2.7 3.9 2.2 1.5 Deposits (yoy %) 5.3 6.6 6.2 3.0 3.2
Deposits ( % GDP) 66.2 68.4 71.1 73.2 73.9 Deposits ( % GDP) 72.7 77.0 81.0 79.4 78.3
Loans to Deposits Ratio (%) 130.7 124.2 120.5 116.2 115.6 Loans to Deposits Ratio (%) 73.0 70.1 68.3 68.2 68.5
External Liabilities (% of total liabilities) 21.7 18.0 17.2 17.3 17.2 External Liabilities (% of total liabilities) 8.5 7.2 9.8 10.4 10.5
Cost to Income Ratio (%) 51.1 53.8 54.5 54.5 54.5 Cost to Income Ratio (%) 44.8 44.0 43.0 43.3 44.7
Revenues/avg. Volumes (%) 3.4 3.1 3.0 3.0 3.0 Revenues/avg. Volumes (%) 3.3 3.2 3.1 3.0 2.9
Return on Assets (%) 1.1 0.9 0.3 0.5 0.6 Return on Assets (%) 1.4 1.6 1.5 1.3 1.3
Impaired loans ratio (% gross loans) 12.4 13.9 15.6 18.0 18.9 Impaired loans ratio (% gross loans) 6.2 6.2 6.1 6.3 6.1
Cost of Risk (%) 1.3 1.3 2.1 1.8 1.7 Cost of Risk (%) 1.3 0.8 1.0 1.1 1.0
29 SOURCE: UniCredit Research, UniCredit CEE Strategic Analysis, UniCredit CEE Banking Network
CEE Country Data – 3/7
Hungary 2011 2012 2013 2014E 2015F Poland 2011 2012 2013 2014E 2015F
Real GDP, % yoy 1.6 -1.7 1.5 3.3 2.3 Real GDP, % yoy 4.8 1.8 1.7 3.3 3.3
Inflation, % avg 3.9 5.7 1.6 0.0 0.4 Inflation, % avg 4.3 3.7 0.9 0.0 0.3
Reference rate, eop (%) 7.00 5.75 3.00 2.10 2.10 Reference rate, eop (%) 4.50 4.25 2.50 2.00 1.75
Loans (yoy %) -0.1 -13.2 -4.2 -0.7 -5.0 Loans (yoy %) 14.8 1.7 3.7 6.1 6.5
Loans ( % GDP) 66.8 57.1 51.4 47.9 43.8 Loans ( % GDP) 58.8 56.6 57.0 58.7 60.8
Deposits (yoy %) 5.3 -0.9 2.4 2.9 0.8 Deposits (yoy %) 10.1 6.0 5.7 8.0 6.9
Deposits ( % GDP) 51.2 50.0 48.2 46.5 45.1 Deposits ( % GDP) 52.2 52.3 53.7 56.2 58.5
Loans to Deposits Ratio (%) 130.3 114.2 106.8 103.0 97.1 Loans to Deposits Ratio (%) 112.7 108.1 106.1 104.3 103.9
External Liabilities (% of total liabilities) 24.5 19.7 16.7 15.3 14.3 External Liabilities (% of total liabilities) 17.5 15.1 14.4 13.1 11.9
Cost to Income Ratio (%) 51.6 83.6 67.9 61.1 65.1 Cost to Income Ratio (%) 50.7 50.9 53.0 51.0 53.7
Revenues/avg. Volumes (%) 3.4 2.1 2.7 3.0 2.8 Revenues/avg. Volumes (%) 3.6 3.5 3.2 3.1 2.8
Return on Assets (%) -0.4 -0.1 -0.1 -1.8 0.4 Return on Assets (%) 1.5 1.4 1.3 1.3 1.1
Impaired loans ratio (% gross loans) 19.2 20.3 21.2 20.5 19.5 Impaired loans ratio (% gross loans) 7.4 7.9 7.6 7.3 6.9
Cost of Risk (%) 3.7 0.9 1.8 6.4 1.0 Cost of Risk (%) 1.1 1.1 0.9 0.9 0.8
30 SOURCE: UniCredit Research, UniCredit CEE Strategic Analysis, UniCredit CEE Banking Network
CEE Country Data – 4/7
Romania 2011 2012 2013 2014E 2015F Russia 2011 2012 2013 2014E 2015F
Real GDP, % yoy 1.1 0.6 3.5 2.7 2.5 Real GDP, % yoy 4.3 3.4 1.3 0.4 -3.4
Inflation, % avg 5.8 3.3 4.0 1.2 1.6 Inflation, % avg 8.6 5.1 6.8 7.7 9.4
Reference rate, eop (%) 6.00 5.25 4.00 2.75 2.50 Reference rate, eop (%) 5.25 5.50 5.50 17.00 8.50
Loans (yoy %) 6.0 0.8 -3.1 -3.6 0.1 Loans (yoy %) 27.4 21.4 18.3 22.2 10.9
Loans ( % GDP) 41.4 39.5 35.7 32.8 31.4 Loans ( % GDP) 41.2 43.6 48.4 54.7 57.4
Deposits (yoy %) 4.8 5.1 9.1 3.0 3.0 Deposits (yoy %) 24.4 12.5 15.3 14.4 11.2
Deposits ( % GDP) 34.1 33.9 34.6 33.9 33.4 Deposits ( % GDP) 43.1 42.3 45.7 48.4 50.9
Loans to Deposits Ratio (%) 121.3 116.4 103.3 96.8 94.0 Loans to Deposits Ratio (%) 95.5 103.1 105.8 113.0 112.7
External Liabilities (% of total liabilities) 26.3 23.2 20.5 17.9 15.9 External Liabilities (% of total liabilities) 12.8 12.2 12.2 11.3 12.8
Cost to Income Ratio (%) 57.3 58.7 56.5 55.6 53.8 Cost to Income Ratio (%) 56.3 54.8 51.3 46.9 47.2
Revenues/avg. Volumes (%) 4.2 4.4 4.3 4.2 4.2 Revenues/avg. Volumes (%) 5.3 5.6 5.7 5.7 4.9
Return on Assets (%) -0.1 -0.7 -0.1 -0.6 0.3 Return on Assets (%) 2.3 2.3 1.9 1.0 0.9
Impaired loans ratio (% gross loans) 23.3 29.9 32.1 14.4 11.4 Impaired loans ratio (% gross loans) 16.3 14.5 12.7 18.0 21.0
Cost of Risk (%) 3.4 4.5 3.8 4.7 3.4 Cost of Risk (%) 0.5 0.8 2.1 4.0 3.4
31 SOURCE: UniCredit Research, UniCredit CEE Strategic Analysis, UniCredit CEE Banking Network
CEE Country Data – 5/7
Serbia 2011 2012 2013 2014E 2015F Slovakia 2011 2012 2013 2014E 2015F
Real GDP, % yoy 1.6 -1.5 2.5 -2.1 -0.7 Real GDP, % yoy 2.7 1.6 1.4 2.3 2.5
Inflation, % avg 11.6 7.3 7.9 2.1 3.6 Inflation, % avg 3.9 3.6 1.4 -0.1 0.4
Reference rate, eop (%) 9.75 11.25 9.50 8.00 6.75 Reference rate, eop (%) EUR EUR EUR EUR EUR
Loans (yoy %) 7.5 13.2 -1.9 6.3 4.0 Loans (yoy %) 8.6 2.2 5.7 5.6 3.9
Loans ( % GDP) 58.1 62.5 56.7 60.3 61.0 Loans ( % GDP) 51.9 51.6 53.4 55.3 56.1
Deposits (yoy %) 9.1 11.3 4.3 6.2 4.9 Deposits (yoy %) 3.1 5.8 4.5 3.6 3.1
Deposits ( % GDP) 40.8 43.2 41.7 44.3 45.2 Deposits ( % GDP) 57.1 58.8 60.2 61.1 61.5
Loans to Deposits Ratio (%) 142.1 144.6 136.0 136.2 135.0 Loans to Deposits Ratio (%) 90.8 87.7 88.7 90.5 91.2
External Liabilities (% of total liabilities) 18.9 18.4 15.7 13.0 12.1 External Liabilities (% of total liabilities) 4.4 3.4 4.1 4.2 4.3
Cost to Income Ratio (%) 61.8 66.1 65.3 62.7 62.1 Cost to Income Ratio (%) 51.9 66.9 60.3 58.8 57.2
Revenues/avg. Volumes (%) 5.1 4.7 4.3 4.2 4.0 Revenues/avg. Volumes (%) 3.3 2.9 2.9 2.9 2.8
Return on Assets (%) 0.0 0.4 -0.1 0.1 0.1 Return on Assets (%) 1.4 1.0 1.2 1.3 1.3
Impaired loans ratio (% gross loans) 19.0 18.6 20.7 24.0 23.0 Impaired loans ratio (% gross loans) 5.8 5.4 5.3 5.4 5.3
Cost of Risk (%) 3.2 2.2 2.7 2.6 2.5 Cost of Risk (%) 1.0 0.5 0.6 0.6 0.6
32 SOURCE: UniCredit Research, UniCredit CEE Strategic Analysis, UniCredit CEE Banking Network
CEE Country Data – 6/7
Slovenia 2011 2012 2013 2014E 2015F Turkey 2011 2012 2013 2014E 2015F
Real GDP, % yoy 0.6 -2.6 -1.0 2.5 1.8 Real GDP, % yoy 8.8 2.1 4.1 2.9 3.4
Inflation, % avg 2.1 2.8 1.9 0.4 0.7 Inflation, % avg 6.5 8.9 7.5 8.9 6.5
Reference rate, eop (%) EUR EUR EUR EUR EUR Reference rate, eop (%) 5.75 5.50 4.50 8.25 7.25
Loans (yoy %) -2.3 -3.9 -16.8 -9.3 2.0 Loans (yoy %) 29.8 15.4 32.5 16.1 16.7
Loans ( % GDP) 88.8 87.4 72.4 63.5 63.4 Loans ( % GDP) 50.1 53.0 63.7 65.7 69.0
Deposits (yoy %) 3.0 -3.6 -7.0 10.4 1.4 Deposits (yoy %) 12.4 10.6 23.4 9.1 15.0
Deposits ( % GDP) 64.8 64.0 59.3 63.2 62.8 Deposits ( % GDP) 50.6 51.2 57.3 55.5 57.5
Loans to Deposits Ratio (%) 137.1 136.6 122.2 100.4 101.0 Loans to Deposits Ratio (%) 99.2 103.5 111.2 118.3 120.0
External Liabilities (% of total liabilities) 27.0 20.4 16.9 15.4 15.7 External Liabilities (% of total liabilities) 14.2 13.6 16.5 16.6 16.1
Cost to Income Ratio (%) 53.6 47.5 65.4 58.1 57.2 Cost to Income Ratio (%) 44.8 41.3 44.1 45.2 44.1
Revenues/avg. Volumes (%) 2.6 2.8 2.2 2.5 2.5 Revenues/avg. Volumes (%) 5.0 5.2 4.8 4.4 4.4
Return on Assets (%) -1.0 -1.3 -7.1 -0.5 0.0 Return on Assets (%) 2.3 2.3 1.9 1.8 1.8
Impaired loans ratio (% gross loans) 11.3 14.6 19.9 20.6 18.9 Impaired loans ratio (% gross loans) 2.6 2.8 2.6 3.0 3.2
Cost of Risk (%) 3.6 4.6 13.2 2.9 2.1 Cost of Risk (%) 1.5 2.0 1.9 1.7 1.8
33 SOURCE: UniCredit Research, UniCredit CEE Strategic Analysis, UniCredit CEE Banking Network
CEE Country Data – 7/7
Ukraine 2011 2012 2013 2014E 2015F
Real GDP, % yoy 5.2 0.3 0.2 -6.7 -4.6
Inflation, % avg 8.0 0.6 -0.3 12.0 20.8
Reference rate, eop (%) 7.75 7.50 6.50 14.00 11.50
Loans (yoy %) 9.4 1.7 11.7 15.5 0.7
Loans ( % GDP) 61.6 57.8 62.8 67.9 59.1
Deposits (yoy %) 18.0 16.4 17.1 0.2 0.2
Deposits ( % GDP) 37.8 40.6 46.2 43.4 37.5
Loans to Deposits Ratio (%) 163.1 142.4 135.9 156.7 157.5
External Liabilities (% of total liabilities) 15.7 13.7 12.7 14.2 15.6
Cost to Income Ratio (%) 63.1 64.9 65.3 43.5 44.0
Revenues/avg. Volumes (%) 6.5 5.7 5.4 6.0 5.1
Return on Assets (%) -0.6 0.4 0.2 -1.2 -1.0
Impaired loans ratio (% gross loans) 37.7 26.7 23.5 30.0 34.0
Cost of Risk (%) 4.7 2.7 2.9 7.4 6.2
34
Contacts – 1/2
This is a product of UniCredit CEE Strategic Analysis
Andrea Lacalamita, Head of Group Strategic Planning and CEE Strategic Analysis
Carmelina Carluzzo, Deputy Head of CEE Strategic Analysis
Mauro Giorgio Marrano, Milen Kassabov, Kamen Kazankin, Olga Solomatina
Kristian Laedre, Carlo Moretto, Lilit Sargsyan
Closing date: January 9th, 2015
35
Contacts – 2/2
UniCredit Bank (Bosnia and Herzegovina)
Jelena Juric
UniCredit Bulbank (Bulgaria)
Kristofor Pavlov
Zagrebacka Banka (Croatia)
Hrvoje Dolenec
UniCredit Bank Czech Republic and Slovakia (Czech Republic and Slovakia)
Pavel Sobisek
Ľubomír Koršňák
UniCredit Bank Hungary (Hungary) Tamas Nagy
Bank Pekao (Poland)
Marcin Mrowiec
UniCredit Tiriac Bank (Romania)
Catalina Molnar
UniCredit Bank (Russia)
Artem Arkhipov
Yapı ve Kredi Bankası (Turkey)
Asli Anginbas
A special thanks to UniCredit Researc
h, UniCredit Group Strategic Planning
36
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limitation: political uncertainty, changes in general economic conditions that adversely affect the level of demand for the company’s products or services, changes in foreign exchange markets, changes in international and domestic
financial markets and in the competitive environment, and other factors relating to the foregoing. All forward-looking statements contained in this report are qualified in their entirety by this cautionary statement
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