european banks conference london, march 2006 · bankinter cautionsthatfigures correspondingto2005...
TRANSCRIPT
BANKINTER cautions that figures corresponding to 2005 results are estimates andtherefore provisional, subject to several requirements, among others, the compulsoryaccounts statement to be made by the Board of Directors to be approved by theGeneral Shareholders Meeting.BANKINTER also cautions that this presentation contains forward looking statements. These forward looking statements are found in various places throughtout thispresentation and include, without limitation, statements concerning our futurebusiness development and economic performance. While these forward lookingstatements represent our judgment and future expectations concerning thedevelopment of our business, a number of risks, uncertainties and other importantfactors could cause actual developments and results to differ materially from ourexpectations. These factors include, but are not limited to (1) general market, macro-economic, governmental and regulatory trends, (2) movements in local andinternational securities markets, currency exchange rates, and interest rates, (3) competitive pressures, (4) technological developments, (5) changes in the financialposition or credit worthiness of our customers, obligors and counterparties. The riskfactors and other key factors that we have indicated could adversely affect ourbusiness and financial performance contained in our past and future filings andreports, including those with the Securities and Exchange Commission of the UnitedStates of America.BANKINTER presents its financial statements following format and criteria stated by Circular of Banco de España 4/04.
01 Reinforcing the CompetitiveAdvantage:
• IT • Innovation• Quality of Service• Talent
02 ...in fostering the growth story
Reinforcing ourCompetitive
Advantage
01Our Competitive Advantages
TalentIT Innovation Quality ofService
Reinforcing ourCompetitive
Advantage
IT
01IT Investments
Ordinary Margin Total Costs
91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05
10%10% 21%21%
Reinforcing ourCompetitive
Advantage
IT
01IT: Three dimensions of value creation
ManagementTools
MultichannelPlatform
CRM
•Risk quality•Risk premia•Cost allocation•Capital allocation•EVA compensation•Management ofTalent•...
•Quality Perception•Conveniency•Usability•Innovation•Higher loyalty•Lower cost•Accurate pricing•...
•Matching client’s needs to surprise•Anticipation/Eventdriven•Advisory•Boosting cross-selling•…
Reinforcing ourCompetitive
Advantage
IT
01IT Investments breakdown
0%
20%
40%
60%
80%
100%
2004 2005 2006
Telecom. Infraestructure Outsourcing Software Develop.
42%
58%
Reinforcing ourCompetitive
Advantage
IT
01Development
2001 2002 2003 2004 2005 2006
Investment in Development
2001-2006:•Cumulative investment: €170 mill.•C.A.G.R.: 7%
Reinforcing ourCompetitive
Advantage
IT
01Development breakdown
0%
50%
100%
2004 2005 2006
Mantainance
New Developments: Products, CRM, Management tools...
46%
54%
Reinforcing ourCompetitive
Advantage
IT
01IT Management tools: Capturing thebenefits of credit risk quality
2,972
2,249
837
1,703
3,8663,470
703
29
409298
0.00
0.05
0.10
0.15
0.20
0.25
9 8 7 6 5 4 3 2 1 0
Exp
ecte
d Lo
ss (%
Exposu
re (
€ M
ill .
Risk Exposure % Expected loss
-BIS II: Mortgages IRB Advanced
Reinforcing ourCompetitive
Advantage
IT
01Keeping the best credit track-record
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
86 88 90 92 94 96 98 00 02 04 05
Sector Bankinter
0.56%
0.23%
-NPL ratio-
Reinforcing ourCompetitive
Advantage
IT
01IT: Multichannel Conveniency
0%
20%
40%
60%
80%
100%
94 95 96 97 98 99 2000 2001 2002 2003 2004 2005
Internet Cards & ATMs Branches Telephone Banking Mobile
32%
4%
52%
Reinforcing ourCompetitive
Advantage
IT
01Helps to boost cross selling and customerprofitability
0.5
1
1.5
2
2.5
0.75 1 1.25 1.5 1.75 2
Bank 2
Bank 3Bank 4
Bank 5Bank 6
Source: JP Morgan October 2004. Spain average base 1
Managing customers
Products per client % clients % revenues
Loyalty
-
+
- +Profitability
8.1
29%
61%
Reinforcing ourCompetitive
Advantage
IT
01
29%16%
5.7
4.4
7.0
20%
35%
5%
5%
Reinforcing ourCompetitive
Advantage
IT
01Avrg. Cross selling (nr. products) & Revenues per customer
5 / €575
7 / €715
8 / €886
9 / €1,103Multichannel
Three channels
Two channels
One channel
An outstanding quality of service
68
70
72
74
76
78
80
Dec'99 Dec'00 Dec'01 Dec'02 Dec'03 Dec'04 Dec'05
Qua
lity
Perc
eive
d
+6.45
Bankinter
Market avrg.
Reinforcing ourCompetitive
Advantage
Quality of Service
01
Quality perception, ISN
77.5
78.2
78.5
78.8Multichannel
Three channels
Two channels
One channel
Reinforcing ourCompetitive
Advantage
Quality of Service
01
Reinforcing ourCompetitive
Advantage
Quality of Service
01Complaints per every 10,000 transactions
0.9
1.15
1.4
1.65
1999 2000 2001 2002 2003 2004 2005
1.611.61
0.950.95
Reinforcing ourCompetitive
Advantage
Quality of Service
01Time to complaint resolution 2005
72%
10%
6%
12%
0 days
1-2 days
2-10 days
More than 10days
Reinforcing ourCompetitive
Advantage
Quality of Service
01The lowest churn rate
6.1%
6.9%
5.5
6.0
6.5
7.0
2004 2005
Reinforcing ourCompetitive
Advantage
Talent
01Talent: People make the difference
3.712 people
16 Nationalities
Avrg. age: 36.6 years
71% University graduates
External job rotation: 7%
Internal turnover: 29%
Teleworkers: 54%
Free to negotiate
68% shareholders
66% EVA linked salary
Reinforcing ourCompetitive
Advantage
Talent
01...in a friendly environment
85%
91%
91%
81%
79%
78%
72%
15%
9%
9%
19%
21%
22%
28%
30% 10% 10% 30% 50% 70% 90%
Overall satisfaction as an employee
Job satisfaction
Customer focus
Direct boss management performance
Clarity of strategy
BK as a recommended place to work
Trainning
2003
▲ 66%
▲ 78%
▲ 76%
▲ 77%
▲ 73%
▲ 69%
▲ 67%
2005
Source: 2005 Internal survey of labor and organizational climate
Reinforcing ourCompetitive
Advantage
Talent
01A strong corporate culture
Technology
Commitment
TrainingDiversity
Organization
Flexibility
Satisfaction Freedom
Reinforcing ourCompetitive
Advantage
01A unique business model
Talent
Culture
Innovation
Technology
Difficult toimitate
Quality of Service
1987
High yield deposits
Pioneering Mutual Funds
1992 1994 1995 2005
SMEs
Triggering the Mortgage Market
Applying the model to exploit opportunities
1994-2005:
CAGR 22.1%
Fostering thegrowth story
...growing organically
Fostering thegrowth storyClient gathering
0
50.000
100.000
150.000
2001 2002 2003 2004 2005
2005: 48.5%
450.000
500.000
550.000
600.000
Dec'01 Dec'02 Dec'03 Dec'04 Dec'05
Active customers
X 1.3
Market capitalization
Fostering thegrowth story
0
500
1.000
1.500
2.000
2.500
3.000
3.500
4.000
4.500
1965
1970
1975
1980
1985
1990
1995
1997
1998
1999
2000
2001
2002
2003
2004
2005
Mar
'06
An outstanding, recurrent growth story
Fostering thegrowth story
0
10,000
20,000
30,000
40,000
50,000
60,000
1970 1975 1980 1985 1990 1995 2000 2005 2010
SMEsWhy not?
Thank you
Investor RelationsDavid Pérez Renovales +34913397532 [email protected] Alonso +34913398579 [email protected]