CEMBRA MONEY BANK AG Cembra - a leading player in financing solutions and services in Switzerland
Holger Laubenthal, CEO
ZKB Swiss Equities conference, 2 November 2023
Agenda
1. Cembra at a glance
2. Business performance
3. Outlook
Appendix
2 | November 2023 | Investor presentation |
Cembra at a glance
Cembra at a glance
A leading provider of financing solutions and services in Switzerland
Over 1 million customers | Decades of experience in | Leading positions | Excellent track record | |||
in Switzerland | Swiss consumer finance | in selected markets | on execution | |||
Outstanding performance since IPO
30 October 2013
15% | 4% | +66% | 0.5% | |||||||
average ROE | annual dividend growth | customers | average NPL1 | |||||||
Four | Resilient | Strong ESG | ||||||||
successful M&A transactions, and | business model in all economic | performance, as affirmed by | ||||||||
cashgate integrated in 11 months | environments | leading ESG rating agencies3 | ||||||||
1 Non-performing loans | 2 Swissbilling (2017), EFL (2017), cashgate (2019), Byjuno (2022) | 3 MSCI ESG: AAA, Sustainalytics Low ESG Risk (Score 16.1) Top 12%), S&P Global CSA (Score 43, Top 10%)
3 | November 2023 | Investor presentation |
Cembra at a glance
Market positions
Serving more than 1 million customers in Switzerland
Personal loans: 39% market share
30 June 2023, personal loans market
Cembra | Bank-now |
Migros | |
Bank | |
Other |
Leader in personal loans
- 9 branches all over Switzerland
- Diversified distribution channels: branches, online, independent agents/partners
- Premium pricing supported by superior personalised service
- Strong dual brand positioning - Cembra & cashgate
Auto business: 21% market share
30 June 2023, leasing receivables
Bank-
now
Captive | Cembra |
Strong independent player
- Strong independent player - no brand concentration
- Partnerships with about 3,700 dealers
- Focus on used cars: ~30% new and ~70% used cars in portfolio
- Dedicated field sales force with four support centres
Credit cards: 12% market share
April 2023, credit cards issued
Swisscard
CembraViseca
Cornèr Bank
Postfinance
UBS
Attractive portfolio of 1m cards
- High customer value leading to frequent card usage
- 12% market share in transaction volumes
- 16% market share in contactless payments
- Mix of co-branding card partner- ships and own card offerings
BNPL: 30-40% market share
2023 (own estimates)
availabill
CembraBobzero MF Group
Klarna
Growth segment Buy now pay later
- Buy now pay later (BNPL): purchase by invoice (online & offline) and invoice financing
- Strong BNPL market growth expected
- 2.3m (+140%) invoices processed (incl. 1.9m BNPL) in H1 2023
4 | November 2023 | Investor presentation |
Cembra at a glance
Strategy 2022 - 2026
Reimagining Cembra
Strategic ambition
Core | Cembra's | |
DNA | ||
Operational | ||
programmes | excellence | |
Business | ||
acceleration | ||
Strategic | New growth | |
opportunity | ||
Cultural | ||
transformation | ||
Financial targets
Key messages
We will leverage technology to deliver the most intuitive customer solutions in consumer finance
We will draw on the strengths of our world-class credit factory and our leadership in selected markets
We will radically simplify our operating model and invest to transform our technology landscape in order to further improve customer service and reduce the cost base by more than CHF 30 million
We will further differentiate our value proposition and enhance our market reach
We will drive embedded finance solutions across products and channels, and we will leverage Swissbilling to grow our
'buy now pay later' business
We will foster a customer-first mindset and create an agile and learning-oriented organisation in which people work together with confidence and trust
We will target an ROE of above 15% from 2024 onwards. We will aim to deliver an increasing dividend, supported by cumulative EPS growth of 20-30% by 2026
5 | November 2023 | Investor presentation |
Cembra at a glance
Embedded finance
Ongoing gradual shift to financing at purchase and post-purchase
Traditional | Embedded finance | |||||||
money lending | Embedded finance | presence | ||||||
Instrument | Pre-purchase | at purchase | post-purchase | |||||
Personal loans | Unsecured loans | | | |||||
Auto leasing and loans | Leasing/loan product tied to vehicle | | | | ||||
Credit card, revolving | Variable terms on credit card balance | | | | ||||
Credit card instalments | Card-based; traditional personal loan terms | | | | ||||
Invoicing Processing | Deferred payment typically after 30 days | | ||||||
Buy Now Pay Later | Deferred payment, partly subject to CCA1 | | ||||||
Other | Object-boundloans, asset leasing (non-Auto), | |||||||
asset renting, subscription etc. | ||||||||
1 Not subject to Swiss Consumer Credit Act as long as less than 3 months, < CHF 500, or interest-free for end-user | ||||||||
6 | November 2023 | Investor presentation |
Cembra at a glance
Long-term risk performance
High quality of assets - loss performance resilient through economic cycles
Loss rate | NPL and delinquencies1 |
Reported | ||||||||||||||||||||||||||
Adjusted for one-off | 3% | 30+ days past due | ||||||||||||||||||||||||
2% | ||||||||||||||||||||||||||
1.1 | 1.0 | 1.0 | 0.8 | 0.9 | 0.9 | 1% | Non-performing loans (NPL) | |||||||||||||||||||
0.7 | 0.7 | |||||||||||||||||||||||||
0.5 | 0.5 | |||||||||||||||||||||||||
0% | Jun'08 | Jun'09 | Jun'10 | Jun'11 | Jun'12 | Jun'13 | Jun'14 | Jun'15 | Jun'16 | Jun'17 | Jun'18 | Jun'19 | Jun'20 | Jun'21 | Jun'22 | Jun'23 | ||||||||||
H1'16 | H1'17 | H1'18 | H1'19 | H1'20 | H1'21 | H1'22 | H1'23 | Jun'07 | ||||||||||||||||||
Risk management characteristics
Write-off performance2
By year of origination from 2007 to 2022
Credit grades3
• | Consistent risk appetite and strategies over many years |
• | Well-diversified portfolios contributing to limited credit losses |
• | Proven resilience of portfolios during financial crisis 2008/2009 and the |
Covid-19 pandemic in 2020/2021 | |
• | Flexibility to adapt to fast changing macro-economic environment |
• | Loss rate gradually normalising after Covid-19 pandemic period and |
expected to remain within mid-term target ≤1% |
6% | |||||||
5% | 2007 | ||||||
2008 | |||||||
4% | 2009 | ||||||
3% | 2010 | ||||||
2% | 2011 | ||||||
2012 | |||||||
1% | 2013 | ||||||
0% | Months since origination | 2014 | |||||
0 | 10 | 20 | 30 | 40 | 50 | 60 |
100%
2015
2016 80%
2017 60%
2018
2019 40%
2020
2021 20%
2022
0%
5% | 4% | 4% | CR1 | |||||||||
14% | 13% | 14% | ||||||||||
CR2 | ||||||||||||
30% | ||||||||||||
29% | 30% | CR3 | ||||||||||
53% | 53% | 52% | CR4&5 | |||||||||
2013 | 2022 | H1'23 |
1 Non-performing loans (NPL) ratio is defined as the ratio of non-accrual financing receivables (at period-end) divided by financing receivables. The increase of NPL ratio from June 2019 is related to the synchronisation of write-off and collection procedures implemented in June 2019| 2 Based on personal loans and auto leases & loans originated by the Bank | 3 Consumer Ratings (CR) reflect associated probabilities of default for material Bank portfolios
7 | November 2023 | Investor presentation |
Cembra at a glance
Sustainability
Strong ESG performance and ratings, and commitment to further improve
Selected sustainability performance targets | External recognition | ||||
Low ESG risk | |||||
E | Reduce Scope 1+2 carbon emissions | ||||
by 75% by 2025 (basis: 2019) | Top 6% (score 16.2) among 245 worldwide | ||||
peers, May 2022 | |||||
Customer net promoter score | Top 10% |
in diversified financial services (Score 45), | |
of at least +302 | |
September 2023 | |
S | AAA |
Employee GPTW2 trust index of at least 70%
G | Independent limited assurance of |
Sustainability Reports (since FY 2021) |
Rated 1st among listed consumer finance worldwide, May 2023
Inclusion
in the 2023 Bloomberg Gender Equality index as one of 11 Swiss companies, January 2023
1 Net promoter score on a scale -100 to 100, FY 2022 | 2 Great Place to Work.org | 3 ISS Governance Quality Score of 1 on a scale from 1 to 10, February 2023
8 | November 2023 | Investor presentation |
Cembra at a glance
Dividends
More than CHF 1 billion dividends paid out since the IPO in 2013
Dividends
CHF per share | Extraordinary dividend | |
from excess capital | ||
4.45 |
3.75 | 3.75 | 3.75 | 3.85 | 3.95 | |||
3.55 | |||||||
3.35 | |||||||
3.10 | |||||||
2.85 |
64 | 66 | 66 | 68 | 69 | 69 | 68 | 72 | 70 | 68 | Pay-out |
ratio as % | ||||||||||
2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 |
- Total CHF 1.05 billion dividends paid out since the IPO in 2013
- 68% average payout ratio
- Dividend for 2023 of at least CHF 3.95
- Tier 1 capital ratio target 17%
- S&P rating of A- since the IPO
1 Tier 1 capital ratio target 18% until June 2019, and 2019 target range of 16 - 17% due to acquisition of cashgate
9 | November 2023 | Investor presentation |
Agenda
1. Cembra at a glance
2. Business performance
3. Outlook
Appendix
10 | November 2023 | Investor presentation |
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Disclaimer
Cembra Money Bank AG published this content on 02 November 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 02 November 2023 07:55:46 UTC.
