3q12 earnings conference call
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3Q12 Earnings Releaseg
November 13th, 2012
Agenda
3Q12 Events and Highlights 3
3Q12 Financial Highlights 4
Product and Revenue Diversification 5
Loan Portfolio 6
Loan Portfolio Quality 7
Active Loan Portfolio Management 8
FICC 9
PINE Investimentos 10
Funding 11
Asset & Liability Management 12
Capital Adequacy Ratio (BIS) 13
Capital Increase 14
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3Q12 Events and Highlights
US$30 million, 7-year funding transaction with the Global Climate Partnership Fund (GCPF), fund backedby the German Government with the KFW Bankengruppe, the Government of Denmark and IFC, andmanaged by Deutsche Bank.
Approval by the Central Bank of the first phase of the capital increase in the amount of R$139.6 million.Amount already incorporated into shareholders´equity.
P iti t ib ti f ll b i li i 9M12 60 2% f C t C dit 17 6% fPositive revenue contributions from all business lines in 9M12: 60.2% from Corporate Credit, 17.6% fromHedging Desk, 11.2% from Treasury and 11.0% from PINE Investimentos, which continues to demonstratethe recurring nature of these revenue streams.
Positive liquidity gap maintained for over 10 quarters: 14 months for credit versus 16 months for funding.
Highly liquid balance sheet, with a strong cash position of R$1.4 billion, or 41% of time deposits.
Nominated by the International Finance Corporation (IFC), as the best issuing bank, in recognition ofPine´s support of the energy efficiency sector.
Ranked amongst the 15 largest players in the CETIP derivatives ranking, and 2nd largest in commodityderivatives.
9th largest bank in Brazil in offering credit to large corporates, 15th in credit to companies, and 5th in
3/15Investor Relations | 3Q12|
g g g p , p ,wealth generated per employee, according to the “Melhores e Maiores” ranking compiled by Examemagazine.
3Q12 Financial HighlightsThe main performance indicators continued to show positive development in the period…
R$ MillionsT t l C dit Ri k1 T t l F di Sh h ld ' E itTotal Credit Risk1
8.3%
Total Funding
7.6%
Shareholders' Equity
23.8%
6,875 7,444 6,248 6,725
982
1,216
Sept 11 Sept 12 S t 11 S t 12
982
Sept 11 Sept 12
ROAE
170 bps19 0%2
Net Income
23 7%
Sept-11 Sept-12 Sept-11 Sept-12 Sept-11 Sept-12
Fee Income
19.0%223.7%86.7%
17.3% 17.7%38 47
15
28
4/15Investor Relations | 3Q12|
¹ Includes debentures, CRIs, eurobonds and hedge fund shares
3Q11 3Q123Q11 3Q123Q11 3Q12
2 Excluding the capital increase of R $ 139.6 million in September,
Product and Revenue Diversification ...with contributions from all business lines, fruits of the strategy of complete service to clients.
Clients with more than one Product Penetration Ratio – Clients with more than one Product
More than 1 product 1 product
41% 40% 37%2.8
2.9
2.8
59% 60% 63%
Revenue MixSept-10 Sept-11 Sept-12 Sept-10 Sept-11 Sept-12
9M11 9M12
Corporate Credit65.9%
PINE Investimentos
3.9%
9M11
PINE Investimentos
11.0%
Treasury4.9%
Corporate Credit60.2%
Treasury11.2%
5/15Investor Relations | 3Q12|
FICC25.3%
FICC17.6%
Loan Portfolio1
The portfolio has maintained its product distribution…R$ millions
8164 477 063
7,426 7,641 7,444
772 756
782 1,021 1,154 942
269 230190
124 10081 47
Retail
Trade finance5,613
6,033 6,0576,545
6,875 7,063
883 822 800 827
1,022 1,117 1,372
1,534 1,687 1,684 1,599 1,699
555
533 622 772
336
269 Trade finance
Guarantees
4 75 172
279 325 386 670 783644 846 881 912
881 883 883
BNDES Onlending
3,251 3,358 3,132 3,126 3,300 3,286 3,370 3,332 3,174 Private Securities
Sept-10 Dec-10 Mar-11 Jun-11 Sept-11 Dec-11 Mar-12 Jun-12 Sept-12
Working Capital
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¹ Includes debentures, CRIs, eurobonds and hedge fund shares
Loan Portfolio Quality... with quality, collaterals, and adequate credit coverage.
Loan Portfolio Quality Non Performing Loans > 90 daysSeptember 30th, 2012
B40,5%
0.8%Contracts overdue
I t ll t O d
C0.5%
0.6% 0.7%0.6%
0.4%
Installments Overdue
11,7%
D-E2,5%
F-H
0.2% 0.2% 0.2% 0.2%
Credit Coverage Collaterals
P d t +80 bps
AA-A43.7%
1,6%Sept-11 Dec-11 Mar-12 Jun-12 Sept-12
Products Pledge
47%
Investments
Guarantees2%
+80 bps
Properties
Investments3%
2.7%3.7% 3.5%
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Receivables26%
Properties Pledge
22%
Sept-11 Jun-12 Sept-12
Active Loan Portfolio Management
3Q12 2Q12
Sugar and Ethanol; 19%
Financial Institutions; 2%
Meatpacking; 2%
Telecom2%
Others; 9%
Sugar and Ethanol16%Financial
Institutions2%
Construction Material
2%
Others 9%
Construction10%
Beverages and
Metal and Mining; 3%
Food Industry; 3%
Chemicals; 3%
;
Construction12%
Beverages and
Food Industry3%
Telecom2%
Chemicals2%
2%
Electric and Renewable Energy;
9%Specialized Services;
4%
Vehicles and Parts; 4%
Beverages and Tobacco; 4%
Electric and Renewable Energy
10%
S i li d
Metal and Mining4%
Vehicles and Parts4%
Beverages and Tobacco
3%
Reduction of exposure to the Sugar and Ethanol sector from 19% to 16%;
Agriculture; 9%
Infrastructure; 7%Foreign Trade; 5%
Transportation and Logistics; 5%Agriculture
9%Infrastructure
6%Transportation and Logistics
6%
Foreign Trade6%
Specialized Services
4%
Reduction of exposure to the Sugar and Ethanol sector, from 19% to 16%;
Increased participation in other sectors such as Electric and Renewable Energy, Transportation and Logistics,
Foreign Trade;
Reshuffle of the 20 largest clients in approximately 25%;
Reduced relative participation of the top 20 clients when compared to shareholders equity by 6%, or 17% when
considering the capital increase; and
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20 largest clients represented 27% of the total portfolio.
FICCPINE is the 2nd player in commodity derivatives1.
Client Notional Derivatives Portfolio by Market Notional Value and MtMSeptember 30th, 2012 R$ millions
Fixed Income
22%597 629
Notional Value
MtM
Stressed MtM
Currency56% 256 238
358 354 354
Commodities22%
56%
3,709 3,712 4,287 4,720 4,875
178 157 126
256 238
Market Segments Portfolio Profile
Scenario on September 30thFixed Income: Fixed Floating Inflation Libor
22%
Sept-11 Dec-11 Mar-12 Jun-12 Sept-12
Scenario on September, 30th
Duration: 210 days
Mark-To-Market : R$238 million
Fixed Income: Fixed, Floating, Inflation, Libor
Currencies: Dollar, Euro, Yen, Pound, Canadian Dollar,Australian Dollar
Stress Scenario (Dollar: +31% and Commodities Prices: -30%):
Stressed MTM: R$629 million
Commodities: Sugar, Soybean (Grain, Meal and Oil), Corn,Cotton, Metals, Energy
9/15Investor Relations | 3Q12|
1Source: Cetip Report, September 2012
PINE InvestimentosConsolidation of the Investment Banking franchise.
Transactions
Capital Markets: Structuring and Distribution of Fixed
Income TransactionsIncome Transactions.
Financial Advisory: Project & Structured Finance, M&A,
and hybrid capital transactions.
R$ 90,400,000Debentures
R$ 36,000,000Debentures
R$ 90,000,000Debentures
y p
Assets under Management: Fixed Income, Credit Funds,
Exclusive Mandates.September 2012
Coordinator
August 2012
Lead Coordinator
July 2012
Coordinator
Volume of Underwriting Transactions RevenuesR$ Millions R$ Millions
880 52
September, 2012August, 2012July, 2012
623
880 52
242 346
217
2
18 1814
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3Q11 2Q12 3Q12 9M11 9M12 3Q11 2Q12 3Q12 9M11 9M12
FundingDiversified sources of funding…
R$ millions
Trade Finance
6,933 6,725
234 250 125 118
180 596 814
753 841
1,089 1,083
Private Placements
Multilateral Lines
5,3225,437
5,9026,248
6,544 6,421,
33 829 898 867 867 868 813
829 -21
33
247 256 281 291 553 561
194 194
185
205 237 246 233 295
260
200 160
282
267 310 353 276
234 156
166 158
155
84 86 125 180
413 377 435
596 International Capital Markets
Local Capital Markets
5,322,5,182
1 287 1,253 1,196 1,186 1,228 1,177
198 214 218
212 228 250 281 223 213 224 320
272 210 165 106 161 194
176 46 42
41 53 66 112 31 33
33 626 829
867 898 867 829
BNDES
Demand Deposits
8 1 965 2 130 2 128 2,153 2 056
1,463 1,530 1,114 1,287 1,253 ,
Interbank Time Deposits
High Net Worth Individual Time Deposits
1,654 1,592 1,720 1,845 1,965 2,130 2,128 2,153 2,056
Sept-10 Dec-10 Mar-11 Jun-11 Sept-11 Dec-11 Mar-12 Jun-12 Sept-12
p
Corporate Time Deposits
Institutional Time Deposits
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p
Asset & Liability Management... presenting a positive gap between credit and funding.
Matching of Transactions
CREDIT FUNDING
Loan / Total Funding
80%76%
81%76% 73%
BNDES BNDES
Trade Finance Trade Finance
73%
DepositsWorking Capital, Private
Securities1 And Cash Financial Bills
ALM Deposits vs. Total Funding
Intl. Funding1 Includes debentures, CRIs, eurobonds, and fund shares
R$ MillionsR$ Millions
Sept-11 Dez-11 Mar-12 Jun-12 Sept-12
41% 45% 46%
Oth
6,9336,248 6,7252,947
2,165
1,739
2,155
1,679
Credit Funding
59% 55% 54%
Others
Total Deposits
-
1,363
494
118 33
,
957
162
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Sept-11 Jun-11 Sept-12
No maturity Up to 3 months
From 3 to 12 months
From 1 to 3 years
From 3 to 5 years
More than 5 years
Capital Adequacy Ratio (BIS)BIS ratio reached 17.0%.
Tier II Tier IMinimum Capital Requirement (11%)
3 6%4.5%
18.4%17.4% 17.1% 16.6%
19.6%18.5%
16.4% 15.9%17.0%
3.6% 3.6% 3.7% 3.4%
4.5%4.2%
3.1% 3.3%3.0%
14.8% 13.8% 13.4% 13.2%15.1% 14.3% 13.3% 12.6% 14.0%
Sept -10 Dec -10 Mar -11 Jun -11 Sept -11 Dec -11 Mar -12 Jun -12 Sept -12
R$ milion BIS Ratio(%)
Tier I 14.0%
Tier II 3.0%
1,210
256
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Total 17.0%1,466
Capital IncreaseCentral Bank approved the capital increase announced in August 2012.
The capital increase resulted in the issuance of 6,558,123 common shares in the amount of R$93,649,996.44,and 3,220,203 preferred shares, totaling R$45,984,498.84, at a unit price of R$14.28.
Summary
Total of R$139.6 million
Total Shares Subscribed: 6,558,123 common shares and 3,220,203 preferred shares:
2,100,839 by DEG;
519,577 by Management;
587,732 by minorities; and
12 055 l ft b ib d b i it h h ld
With the aproval of the Central Bank, the shareholders´ structure is as follows:
12,055 left overs subscribed by minority shareholders.
f d lCommon Preferred Total %
Controlling Shareholder 58,444,889 15,595,863 74,040,752 68.2%
Management - 5,923,784 5,923,784 5.5%
Free Float - 28,271,724 28,271,724 26.0%
Individuals - 2,734,411 2,734,411 2.5%
Institutional Investors - 11,330,025 11,330,025 10.4%
DEG - 5,005,067 5,005,067 4.6%
Foreign Investors - 9,202,221 9,202,221 8.5%
T eas 394 840 394 840 0 4%
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Treasury - 394,840 394,840 0.4%
Total 58,444,889 50,186,211 108,631,100 100.0%
For managerial purposes, minority shareholders were considered individuals.
Investor Relations
Noberto N. Pinheiro Júnior
CEO
Susana Waldeck Norberto Zaiet Junior
CFO / IRO COO
Raquel Varela
H d f I R l iHead of Investor Relations
Alejandra Hidalgo
Investor Relations ManagerInvestor Relations Manager
Ana Lopes
Investor Relations AnalystInvestor Relations Analyst
Fone: +55-11-3372-5343
Thi t t i f d l ki t t t i th b i t j ti f ti d fi i l lt d th tl k f PINE Th l j ti d h
www.pine.com/ir
ir@pine.com
15/15Investor Relations | 3Q12|
This report may contain forward-looking statements concerning the business prospects, projections of operating and financial results and growth outlook of PINE. These are merely projections and as suchare based solely on management’s expectations regarding the future of the business. These statements depend substantially on market conditions, the performance of the sector and the Brazilian economy(political and economic changes, volatility in interest and exchange rates, technological changes, inflation, financial disintermediation, competitive pressures on products and prices and changes in taxlegislation) and therefore are subject to change without prior notice. Given that PINE is in quiet period because of the issuance of Financial Bills of its 2nd public issuance, we recommend that any potentialinvestor read in conjunction with this Press Release, the Final Prospectus (in particular the section "Risk Factors") and the documents incorporated by reference to it, such as PINE's Reference Form,available on its website (www.pine.com/ir)..
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