4Q 2016 Financial Summary December 2016
Index 2 3 4 6 7 1. Economic and financial environment 2. Financial highlights 3. Results 4. Condensed balance sheet 5. Customer funds and lending 8 8 9 10 11 6. Quality of assets 7. Change in NPLs 8. Consolidated statements of income 9. Quarterly statements of income 10. Fees and commissions 12 13 14 14 15 11. Cumulative yields and costs 12. Quarterly yields and costs 13. Contribution by business area 16 17 18 16. Shareholder value 17. People 18. Quarterly events 14. Shareholders equity and ratings 15. Change in net worth
3 2. Financial highlights Variation Balance sheet 31/12/2016 31/12/2015 Amount % Total assets 67,182,467 58,659,810 8,522,657 14.53 Credit facilities and loans 51,184,773 44,182,634 7,002,140 15.85 Total customer funds 75,411,758 65,317,531 10,094,227 15.45 On balance sheet 51,869,456 44,314,476 7,554,979 17.05 Retail customer funds ex repos 44,127,812 34,603,553 9,524,259 27.52 Marketable debt securities 6,923,396 8,920,997-1,997,601-22.39 Off-balance-sheet managed funds 23,542,302 21,003,055 2,539,247 12.09 Shareholders equity 4,097,376 3,798,177 299,199 7.88 Earnings Net interest income 979,017 869,454 109,563 12.60 Gross operating income 1,717,389 1,568,815 148,575 9.47 Pre-provision profit 815,142 807,761 7,381 0.91 Profit before taxes 676,711 520,330 156,381 30.05 Net attributable income 490,109 375,920 114,188 30.38 RATIOS (%) Non-performing loans/total risk exposure 4.01 4.13-0.12-2.91 Recorded allowance/non-performing loans 49.26 41.99 7.27 17.31 Cost-to-income 52.54 48.51 4.03 8.31 RoE 13.48 10.91 2.57 23.56 RoA 0.78 0.66 0.12 18.18 CET 1 capital 11.77 11.77 0.00 0.01 Bankinter shares Number of shares 898,866,154 898,866,154 0 0.00 Closing price ( ) 7.36 6.54 0.82 12.54 EPS ( ) 0.55 0.42 0.13 30.35 DPS ( ) 0.21 0.23-0.02-8.15 Branches and BUSINESS UNITS Number of branches 447 361 86 23.82 Other business units Corporate bkg 22 22 0 0.00 SMEs 73 78-5 -6.41 Private bkg 49 48 1 2.08 Corporate partnerships 315 431-116 -26.91 Number of financial agents 482 505-23 -4.55 Telephone and on-line banking 3 3 0 0.00 EMPLOYEES Banking group employees 5,486 4,405 1,081 24.54 Insurance business (LDA) employees 2,049 1,983 66 3.33
6 4. Condensed balance sheet Var. 12/16-12/15 31/12/2016 31/12/2015 Thousand % ASSETS Cash, balances with central banks and other demand deposits 3,556,750 1,448,882 2,107,869 145.48 Financial assets held for trading 2,676,719 4,473,638-1,796,919-40.17 Financial assets at fair value through profit or loss 0 57,209-57,209-100.00 Available-for-sale financial assets 4,140,057 3,530,153 609,904 17.28 Loans and receivables 52,816,104 44,955,793 7,860,311 17.48 Debt instruments 499,004 446,230 52,775 11.83 Loans and advances 52,317,100 44,509,564 7,807,536 17.54 To credit institutions 1,132,327 326,930 805,396 246.35 To customers 51,184,773 44,182,634 7,002,140 15.85 Held-to-maturity investments 2,019,546 2,404,757-385,211-16.02 Derivatives/hedge accounting 215,965 160,073 55,892 34.92 Investments in joint ventures and associates 112,708 39,424 73,285 185.89 Assets under insurance and reinsurance contracts 3,124 2,889 235 8.14 Tangible assets 503,716 493,114 10,602 2.15 Intangible assets 245,063 266,693-21,631-8.11 Tax assets and other assets 589,694 508,899 80,796 15.88 Non-current assets held for sale 303,021 318,287-15,266-4.80 TOTAL ASSETS 67,182,467 58,659,810 8,522,657 14.53 LIABILITIES Financial liabilities held for trading 2,195,816 3,769,080-1,573,263-41.74 Financial liabilities at amortised cost 59,338,635 49,836,994 9,501,641 19.07 Deposits 48,788,810 37,630,699 11,158,111 29.65 From central banks 4,750,000 3,017,983 1,732,017 57.39 From credit institutions 1,472,286 1,792,316-320,030-17.86 From customers 42,566,523 32,820,399 9,746,124 29.70 Issued debt instruments 8,915,470 11,079,445-2,163,975-19.53 Other financial liabilities 1,634,355 1,126,850 507,505 45.04 Derivatives/hedge accounting 109,154 11,489 97,664 850.05 Liabilities under insurance contracts 683,659 630,983 52,676 8.35 Provisions 153,707 95,868 57,838 60.33 Tax liabilities and other liabilities 604,121 517,219 86,902 16.80 TOTAL LIABILITIES 63,085,091 54,861,633 8,223,458 14.99 Shareholders equity 3,987,518 3,689,436 298,082 8.08 Total comprehensive income 109,858 108,741 1,117 1.03 TOTAL SHAREHOLDERS EQUITY 4,097,376 3,798,177 299,199 7.88 TOTAL LIABILITIES AND EQUITY 67,182,467 58,659,810 8,522,657 14.53
7 5. Customer funds and lending Bankinter Group Like-forlike* Variation 31/12/2016 31/12/2016 31/12/2015 Amount % Retail funds 44,127,812 40,451,444 34,603,553 5,847,892 16.90 Public sector deposits 904,166 904,166 536,940 367,226 68.39 Private sector deposits 41,349,852 37,676,497 32,065,587 5,610,910 17.50 Current accounts 31,242,882 28,904,263 22,293,479 6,610,785 29.65 Term deposits 10,087,466 8,755,485 9,727,181-971,696-9.99 Valuation adjustments 19,504 16,750 44,928-28,178-62.72 Other demand accounts 300,119 297,105 219,214 77,891 35.53 Retail marketable securities 1,573,676 1,573,676 1,781,812-208,136-11.68 Repurchase agreements 818,248 818,248 789,927 28,321 3.59 Wholesale marketable securities 6,923,396 6,923,396 8,920,997-1,997,601-22.39 Promissory notes and bills 0 0 536,304-536,304-100.00 Securitisations 1,076,633 1,076,633 1,357,762-281,129-20.71 Covered bonds 5,153,683 5,153,683 6,194,371-1,040,688-16.80 Senior debt 497,548 497,548 677,037-179,490-26.51 Valuation adjustments 195,532 195,532 155,523 40,009 25.73 TOTAL ON-BALANCE-SHEET FUNDS 51,869,456 48,193,088 44,314,476 3,878,612 8.75 Off-balance-sheet funds 23,542,302 21,120,536 21,003,055 117,482 0.56 Own mutual funds 7,619,966 7,619,966 7,417,439 202,527 2.73 External mutual funds marketed 8,803,782 6,493,644 6,187,744 305,900 4.94 Pension funds 2,261,755 2,221,515 2,085,600 135,915 6.52 Wealth management and SICAVs 4,856,800 4,785,412 5,312,272-526,860-9.92 Loans and advances to customers Loans to public sector 1,513,810 1,513,810 1,676,296-162,486-9.69 Loans to private sector 49,670,963 45,263,293 42,506,338 2,756,955 6.49 Commercial credit 1,963,758 1,951,011 1,793,057 157,954 8.81 Secured loans 30,124,036 26,628,231 25,915,053 713,178 2.75 Other credit facilities 13,865,228 13,143,407 11,540,110 1,603,297 13.89 Personal loans 7,480,439 6,772,972 6,319,321 453,650 7.18 Credit lines 6,370,436 6,370,436 5,220,789 1,149,647 22.02 Other lending 14,353 0 0 0 n,r Finance leases 1,181,996 1,128,564 985,139 143,426 14.56 Non-performing loans 2,227,808 1,807,191 1,990,922-183,731-9.23 Loan-loss allowances -1,105,291-745,709-860,702 114,993-13.36 Other term lending 1,413,429 1,350,597 1,142,758 207,839 18.19 Loans and advances to customers 51,184,773 46,777,103 44,182,634 2,594,469 5.87 Fixed-income securities to customers 148,999 0 0 0 - TOTAL LOANS TO CUSTOMERS 51,333,772 46,777,103 44,182,634 2,594,469 5.87 Off-balance-sheet risks 14,471,212 14,021,658 12,601,692 1,419,966 11.27 Contingent risks 3,934,041 3,822,620 3,229,661 592,959 18.36 Drawable by third parties 10,537,171 10,199,038 9,384,389 814,649 8.68 *Does not include Portugal and consolidation and strategic projects.
8 6. Quality of assets Variation 31/12/2016 31/12/2015 Amount % Total risk exposure 57,308,266 49,415,783 7,892,483 15.97 Total non-performing loans 2,296,743 2,039,239 257,504 12.63 Credit risk provisions 1,131,359 856,302 275,057 32.12 NPL ratio (%) 4.01 4.13-0.12-2.91 NPL coverage ratio (%) 49.26 41.99 7.27 17.31 Foreclosed assets 523,453 531,348-7,895-1.49 Provision for foreclosed assets 220,433 213,061 7,372 3.46 Foreclosed asset coverage(%) 42.11 40.10 2.01 5.03 7. Changes in NPLs Variation 31/12/2016 31/12/2015 Amount % Initial balance 2,039,239 2,232,732-193,493-8.67 Net additions 423,277 39,384 383,893 974.74 Write-offs -165,773-232,877 67,104-28.82 Final balance 2,296,743 2,039,239 257,504 12.63 NPL ratios: Bankinter vs Sector (%) 9.23% 4.01% 86 88 90 92 94 96 98 00 02 04 06 08 10 12 13 14 15 4Q16 l Bankinter l Sector Sector source: Bank of Spain, November 2016
9 8. Consolidated statements of income 31/12/2016 31/12/2015 Variation Bankinter Group Amount Amount Amount % Interest and similar income 1,271,458 1,283,765-12,306-0.96 Interest expense and similar -292,441-414,311 121,869-29.41 Net interest income 979,017 869,454 109,563 12.60 Dividend income 10,253 6,681 3,572 53.47 Share of results of entities accounted for under equity method 22,093 18,223 3,870 21.24 Net fees and commissions 379,110 357,329 21,780 6.10 Gains on financial transactions and exchange differences 71,449 71,651-202 -0.28 Other operating income/expenses 255,468 245,477 9,991 4.07 Gross operating income 1,717,389 1,568,815 148,575 9.47 Staff costs -462,693-393,459-69,234 17.60 General & admin. expenses and amortisation charge -439,555-367,594-71,960 19.58 Pre-provision profit 815,142 807,761 7,381 0.91 Provisions -38,611-25,254-13,356 52.89 Impairment charges -169,190-189,592 20,402-10.76 Operating profit net of provisions 607,342 592,915 14,426 2.43 Gains/(losses) on disposal of assets -75,770-72,585-3,185 4.39 Negative goodwill recognised 145,140-145,140 - Profit before taxes 676,711 520,330 156,381 30.05 Income tax -186,603-144,410-42,193 29.22 Consolidated net income 490,109 375,920 114,188 30.38
10 9. Quarterly statements of income Bankinter Group Like-for-like* Variation in % Bankinter Group 4Q16 3Q16 2Q16 4Q16 3Q16 2Q16 4Q16/4Q15 4Q16/3Q16 1Q16 4Q15 Interest and similar income 330,896 314,752 322,874 298,436 296,014 301,701-4.24 0.82 302,936 311,664 Interest and similar charges -64,707-65,536-79,347-61,573-64,038-76,852-31.83-3.85-82,851-90,325 Net interest income 266,189 249,216 243,527 236,863 231,976 224,849 7.01 2.11 220,085 221,339 Dividend income 2,057 1,953 3,904 2,057 1,953 3,904 112.25 5.33 2,340 969 Share of results of entities 6,097 5,946 5,399 4,892 5,652 3,927 8.10-13.43 4,650 4,526 accounted for under equity method Net fees and commissions 105,093 93,775 95,074 96,613 85,378 86,934 9.07 13.16 85,169 88,576 Gains/(losses) on financial 15,390 6,640 32,131 15,394 6,642 32,136-32.62 131.78 17,288 22,845 transactions and exchange differences Other operating income/expenses 52,616 76,922 44,711 54,769 76,777 44,724 77.52-28.67 81,218 30,852 Gross operating income 447,441 434,453 424,746 410,589 408,378 396,473 11.24 0.54 410,750 369,106 Staff costs -128,523-116,991-117,634-103,684-101,516-103,526 5.29 2.14-99,546-98,471 General & admin. expenses and -118,911-108,997-112,288-96,460-92,040-88,706 6.97 4.80-99,359-90,173 amortisation charge Pre-provision profit 200,007 208,465 194,824 210,446 214,822 204,241 16.61-2.04 211,846 180,462 Provisions -10,277-11,752-8,598-13,766-9,645-7,816 162.87 42.72-7,983-5,237 Impairment charges -34,526-36,811-52,574-28,017-33,065-46,836-50.96-15.27-45,278-57,127 Operating profit net of 155,204 159,902 133,652 168,663 172,113 149,589 42.82-2.00 158,584 118,098 provisions Gains/(losses) on disposal of -30,745-6,540-27,489-31,708-7,040-10,357 88.18 350.43-10,996-16,850 assets Negative goodwill recognised 4,460-7,191 147,871 - - - - - - - Profit before taxes 128,919 146,170 254,034 136,955 165,073 139,231 35.27-17.03 147,588 101,249 Income tax -38,849-32,138-72,815-46,006-32,571-41,000 85.10 41.25-42,801-24,854 Consolidated net income 90,070 114,032 181,219 90,949 132,502 98,231 19.05-31.36 104,788 76,395 *Does not include Portugal and consolidation and strategic projects. Gross operating income (millions of euros) and quarterly cost-to-income ratio (%) Pre-provision profit (millions of euros) 369 411 425 434 54.1 52.0 447 55.3 180 212 195 208 200 51.1 48.4 4Q15 1Q16 2Q16 3Q16 4Q16 4Q15 1Q16 2Q16 3Q16 4Q16 l Cost-to-income ratio l Gross operating income
11 10. Fees and commissions Variation 31/12/2016 31/12/2015 Amount % FEE AND COMMISSION EXPENSE 91,740 80,275 11,464 14.28 FEE AND COMMISSION INCOME On guarantees and documentary credits 31,158 30,702 456 1.49 On foreign exchange and foreign banknotes 60,145 56,350 3,795 6.73 On contingent liabilities 12,641 14,590-1,949-13.36 On collection and payment services 81,512 64,380 17,132 26.61 On securities services 83,085 85,587-2,502-2.92 Securities underwriting and placement 3,877 2,971 906 30.49 Securities trading 31,672 36,583-4,911-13.42 Securities administration and custody 32,188 27,466 4,722 17.19 Wealth management 15,347 18,567-3,220-17.34 On marketed non-banking financial products 168,101 153,775 14,326 9.32 Asset management 113,838 108,792 5,045 4.64 Insurance and pension funds 54,264 44,983 9,281 20.63 Other fees and commissions 34,207 32,220 1,987 6.17 Total fee and commission income 470,849 437,604 33,245 7.60 NET FEES AND COMMISSIONS 379,110 357,329 21,780 6.10
12 11. Cumulative yields and costs in % 31/12/2016 31/12/2015 Weighting Rate Weighting Rate Cash and deposits with central banks 1.04 1.21 0.84 0.02 Loans and advances to credit institutions 4.98 0.15 4.88 0.09 Loan and advances to customers (a) 75.28 2.08 74.48 2.35 Debt securities 13.37 2.83 14.61 3.26 Of which ALCO portfolio 7.87 3.33 8.47 3.48 Equity portfolio 0.53 3.03 0.57 2.07 Other unweighted income 0.14 0.13 Average earning assets (b) 95.19 2.11 95.38 2.38 Other assets 4.81 4.62 Average total assets 100.00 2.01 100.00 2.27 Deposits from central banks 4.75 0.05 3.74 0.12 Deposits from credit institutions 5.53 1.79 10.84 1.43 Customer funds (c) 76.95 0.34 72.14 0.68 Customer deposits 62.18 0.22 54.69 0.48 Marketable debt securities 14.77 0.85 17.45 1.29 Subordinated liabilities 1.02 4.30 1.07 4.95 Other unweighted costs 0.11 0.13 Average interest-bearing funds (d) 88.27 0.52 87.79 0.83 Other liabilities 11.73 12.21 Average total funds 100.00 0.46 100.00 0.73 Customer margin (a-c) 1.74 1.67 Net interest margin (b-d) 1.59 1.55
13 12. Quarterly yields and costs in % 4Q2016 3Q2016 2Q2016 1Q2016 4Q2015 Weighting Rate Weighting Rate Weighting Rate Weighting Rate Weighting Rate Deposits with central banks 1.19 2.02 0.98 2.49 0.95 0.00 1.02 0.00 0.98 0.01 Loans and advances to credit 6.89 0.06 4.70 0.08 4.08 0.37 4.11 0.17 5.01 0.12 institutions Loans and advances to customers 75.13 2.10 75.83 2.00 75.85 2.10 74.20 2.13 74.55 2.19 (a) Debt securities 11.76 2.83 12.94 2.75 13.79 2.78 15.19 2.95 14.43 3.22 Of which ALCO portfolio 7.48 3.24 7.82 3.29 7.77 3.35 8.48 3.44 8.12 3.48 Equity portfolio 0.58 2.12 0.56 2.12 0.49 4.94 0.48 3.33 0.53 1.25 Other unweighted assets 0.13 0.13 0.13 0.14 0.13 Average earning assets (b) 95.55 2.09 95.02 2.04 95.16 2.15 95.00 2.20 95.50 2.24 Other assets 4.45 4.98 4.84 5.00 4.50 Average total assets 100.00 1.99 100.00 1.93 100.00 2.04 100.00 2.09 100.00 2.14 Deposits from central banks 6.07 0.01 6.14 0.00 3.46 0.11 3.11 0.14 3.17 0.14 Deposits from credit institutions 3.99 2.10 4.70 1.85 7.08 1.48 6.49 1.90 7.86 2.00 Customer funds (c) 77.14 0.25 76.26 0.29 77.14 0.39 77.30 0.45 75.66 0.50 Customer deposits 64.53 0.15 62.83 0.20 61.25 0.25 59.83 0.29 57.53 0.33 Marketable debt securities 12.62 0.79 13.43 0.69 15.89 0.92 17.47 0.98 18.13 1.01 Subordinated liabilities 1.04 4.00 1.08 3.93 0.98 4.39 0.99 5.00 1.03 5.03 Other unweighted liabilities 0.12 0.10 0.11 0.12 0.12 Average interest-bearing funds (d) 88.27 0.44 88.20 0.45 88.67 0.56 87.89 0.64 87.71 0.70 Other liabilities 11.73 11.80 11.33 12.11 12.29 Average total funds 100.00 0.39 100.00 0.40 100.00 0.50 100.00 0.57 100.00 0.62 Customer margin (a-c) 1.85 1.71 1.71 1.69 1.70 Net interest margin (b-d) 1.65 1.58 1.59 1.55 1.53 Average Total Assets (ATA, in thousands of euros) 66,419,976 65,142,804 64,358,475 58,837,625 58,000,873 Quarterly customer margin / credit yield and cost of funds (%) 1.70 1.69 1.71 1.71 1.85 4Q15 1Q16 2Q16 3Q16 4Q16 l Cost of customer funds l Customer margin l Yield on customer lending
14 13. Contribution by business area Variation 31/12/2016 31/12/2015 Amount % Customer segments 1,108,332 1,004,644 103,687 10.32 Commercial and private banking 454,790 393,948 60,842 15.44 Corporate banking 532,353 524,562 7,791 1.49 Bankinter Consumer Finance 121,189 86,135 35,054 40.70 Bankinter Portugal 90,227 0 90,227 - Capital markets 240,379 245,147-4,768-1.95 Línea Directa Aseguradora 359,358 351,308 8,050 2.29 Corporate Centre -80,906-32,284-48,622 150.61 Gross operating income 1,717,389 1,568,815 148,575 9.47 14. Shareholders equity and ratings Variation 31/12/2016 31/12/2015 Amount % Share capital and reserves 3,961,056 3,609,242 351,814 9.75 Treasury shares -132-988 856-86.67 CET1 deductions -338,886-401,534 62,648-15.60 Common Equity Tier 1 3,622,038 3,206,720 415,318 12.95 AT1 instruments 200,000-200,000 - AT1 deductions -153,504 - -153,504 - Tier 1 3,668,534 3,206,720 461,814 14.40 T2 instruments 273,661 340,412-66,752-19.61 T2 deductions -70,537-79,800 9,262-11.61 Tier 2 203,123 260,613-57,489-22.06 Total Equity 3,871,657 3,467,333 404,325 11.66 Risk-weighted assets 30,763,487 27,238,576 3,525,974 12.94 CET 1 capital ratio (%) 11.77 11.77 0.00 0.01 Tier 1 (%) 11.92 11.77 0.15 1.29 Tier 2 (%) 0.66 0.96-0.30-30.99 Capital adequacy ratio (%) 12.59 12.73-0.14-1.14 (*) The CET1 amount includes forth-quarter retained earnings. Long term Short term Outlook Date Moody s Baa2 P-2 Stable June 2015 Standard & Poor s BBB- A3 Positive April 2016 DBRS BBB (high) R-1 (low) Positive July 2016
15 15. Change in net worth Balance at 1 January 2015 3,643,445 Dividends for the period -206,215 Valuation adjustments -20,790 Profit for the period 375,920 Other changes 5,817 Balance at 31 December 2015 3,798,177 Balance at 1 January 2016 3,798,177 Dividends for the period -189,453 Valuation adjustments 1,117 Profit for the period 490,109 Other changes -2,574 Balance at 31 December 2016 4,097,376
16 16. Shareholder value Period per share data ( ) Earnings per share 0.55 Dividend per share 0.21 Book value per share 4.56 Opening price 6.54 Lowest price 6.27 Highest price 7.69 Closing price 7.36 Revaluation in last quarter (%) 16.23 Revaluation in last 12 months (%) 12.47 Stock market ratios Price/Book value (times) 1.61 Price/Earnings Ratio (times) 13.50 Dividend yield (%) 2.86 Number of shareholders 57,750 Number of shares 898,866,154 Number of shares held by non-residents 414,227,135 Average daily trading (number of shares) 2,575,659 Average daily trading () 18,174 Market capitalisation () 6,615,655 Share price. Relative variation (%) (Dec 15 base 100) Dec. 15 Dec. 16 l Ibex 35 l Bankinter l Eurostoxx Banca (SX7P)
17 17. People 31/12/2016 31/12/2015 Variation % Banking group employees (*) 5,486 4,405 1,081.00 24.54% Average number of years with Bankinter Group 12.54 12.47 0.07 0.56% Average age (in years) 41.40 41.19 0.21 0.51% Employee distribution by gender (%) Men 48.87 49.35-0.48-0.97% Women 51.13 50.65 0.48 0.95% Internal job rotation (%) 17.97 27.74-9.77-35.23% External rotation (%) 4.45 4.40 0.05 1.11% (*)Data on average mobile turnover in last 12 months.
Bankinter SA Paseo de la Castellana, 29 28046 Madrid T. 913 397 500 bankinter.com