bank we can be proud of - getin noble banken.gnb.pl/gnb_en/doc/news/prezentacje/2016/getin noble...
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BANK WE CAN BE PROUD OFGETIN NOBLE BANK'S STRATEGY FOR 2016-2018
Getin Noble Bank 2016-2018
BANK WE CAN BE PROUD OF
GOALSAND
ASPIRATIONS
WHERE WE WILL
COMPETE
HOW WE WANT TO WIN
HOW WE ORGANIZE
OURSELVES
BANKING SECTOR IN POLAND 2016-2018
Low interest rates = low interest margin
Relatively stable macroeconomic
situation
Regulatory environment as a huge
challenge
Changing role of banking channels
Increasing significance of mobile banking
Clients expect an integrated model of
services
Mass and affluent segments
as the main source of income
Newsweek(ranking)
completely changed
LOAN MIX
6th place Newsweek
TECHNOLOGICAL LEAP
lower than targeted
WRITE-
OFFS
sale of NPLs
7.3 bnNPL
4.3 bnSALES VALUE
premium for deposits
Jakość na bank TNS Polska
20
4
22
11
staff turnover
-33%
equity
9.9%
14.3%
new network of branches
<90%
DL/
share of current deposits
9%
16%224b.p.
147b.p.
Getin UP strategy
2013-2015 WHAT WORKED WELL?
GNB HAS STRONG DISTINGUISHING TRAITS...
Strong base of deposits
Entrepreneurial culture
Ability to change sale priorities quickly
Strong position in the segment of real estate developers
Hidden reserves of growth
GNB Competence in cash loans
Local owner – quick decisions
Leading offer for car financing
... BUT THERE ARE ALSO SUBSTANTIAL CHALLENGES
Financing cost
Historical focus on product
Low sustainable income
Substantial share of one business
line
Poor quality old portfolio
2016-2018 STRATEGY IS A STAGE IN THE BANK'S LONG-TERM TRANSFORMATION
GETIN UPStrategy
StrategyBANK WE CAN BE PROUD OF
Improving profitability through building relationship banking
StrategyCRUISING ALTITUDE
2013
2016
2018
Bank we can be proud of
We are creating a bank for Clients
We want Getin Noble to be perceived as a reliable and efficient bank
We also want to be an employer of choice
Based on such values the bank is going to bring stable and sustainable income
VISION
MISSION
BANK'S NEW VALUES
ENTREPRENEURSHIP
Good solutions are not enough. We are busylooking for best ways for
accomplishing ambitious goals.
RESPECT
The foundations of our internal relationshipsand relationships with our clients are mutual
trust, kindness, and respect.
ORDER
Following strictly work planning and organizationwe are proud to keep our promises and deliver
COOPERATION
We are committed to responsible business conduct.
� Bank's NPS >20%� NPS after
visiting a branch >55%� 400k active Clients,
salaries transferred to checking and savingsaccounts
GOALS OF GETIN NOBLE BANK
SHAREHOLDERS
Profitability and efficiency comparable to top 10 banks
CLIENTS
Satisfaction with quality of services and tailor made
products
REGULATOR
Sustainable balance sheet structure
EMPLOYEES
Stable employer of choicein the sector
� engagement rate >50%
� 70% recruitmentfrom the sector
� sales staff turnover <15%� L/D ~90%� Tier 1 capital >12%
� Gross ROE > 10%� C/I <50%
PILLARS OF THE STRATEGY
Offered benefits fitted
to SEGMENTS
TRUST AND EFFICIENCY oriented brand
ONE NETWORKof branches
fitted to the potentiall ofmicromarkets
QUALITY orientedbanking culture
Integrated customer servicein all channels withMOBILE BANKING
as the distinguishing feature
EFFICIENT HEADQUARTERS
support, analysis, pre-approval
WHERE DO WE WANT TO GET IN 3 YEARS? (1/2)
2015 2018 (ASPIRATIONS)
RETAIL BANKING
INCOME Number of active checking and savings accounts (thous.)
200 >400
FINANCING COSTShare of term deposits (%) 84 75
Premium for deposits costs to the market (b.p.) ~147 ~60
CORPORATEBANKING
AUTOMOTIVE LEADERLeasing: Sale volume (PLNm) 3,022
Car loans: Sale volume (PLNm) 1,350
SMEs / REAL ESTATE DEVELOPERS
Real estate developers: market position Top 3 Top 3
SMEs: Sale volume (PLNm) 285
Loans to corporations: Sale volume (PLNm) 1,409
WHERE DO WE WANT TO GET IN 3 YEARS? (2/2)
2015 2018 (ASPIRATIONS)
BANK'SPROFITABILITY
Gross ROE (%) 1.43% >10%
C/I (%) 56 <50%
Cost of risk (b.p.) 80* ~100
BALANCE SHEET
L/D (%) 86 ~90
Share of wholesale funding ** (%) 14 10
CT1 (%) 10.4 12.6
• The rate for 2015 distorted by the sale of NPL. In 2016-2018, consistent decline of the cost of risk to c. 100 bp
** From: securitisation, issued securities, bonds and liabilities to other institutions.
Getin Noble Bank 2016-2018
BANK WE CAN BE PROUD OF
HOW WE WANT TO WIN
HOW WE ORGANIZE
OURSELVES
GOALSAND
ASPIRATIONS
WHERE WE WILL
COMPETE
Where will we compete?
RETAIL BANKING IS 66% OF THE BANKING MARKET IN POLAND
Net proceeds, before risk. Retail: natural persons and individual farmers. Micro: natural persons that employ up to 9 persons – 1% of micro enterprises keep accounting books. SMEs and corporations: natural persons that employ over 9 persons and legal entities – 89% companies in that segment keep accounting books. Other proceeds from banking operations are not included: proceeds from dividend and result on financial instruments to be traded. Source: Market model of banking sector in Poland, Deloitte.
Net proceeds from banking sectorPoland, 2014, PLN bn
66%
9%
25%
RETAIL MICRO SMEs and CORPORATIONS
Number of clients, thous. ~22,200 ~1,600 ~190
Proceeds per client, thous PLN. ~1.5 ~2.8 ~65.6
33.5
4.5
12.4
Where will we compete?
MASS AND AFFLUENT CLIENTFROM MEDIUM AND LARGE CITIES
CORE TARGET OF GNB
PROCEEDSNUMBER OF
CLIENTS
BANKING PENETRATION
RATIO
SIZE OF TOWN/CITY
GNB NETWORK
Lower mass client(<2,500 PLN)
12.2 61% Getin Bank
Mass client(2,500-7,500 PLN)
8.4 79%
towns over 50 thous.
inhabitants
Getin Bank
Affluent client(7,500-30,000 PLN)
1.6 93%Getin Bank + Noble Bank
Private client(>30,000 PLN)
0.1 100% Noble Bank
Total retail banking
22.2 69%
Note: values for clients that use Bank services (~69% of the population); segment definitions acc. to net proceeds Net proceeds before cost of risk (billion) Number of clients (million) Source: Deloitte's Retail Banking Model
2%
23%
47%
28% 9.2
15.8
7.8
0.6
33.5
Where will we compete?
AFFLUENT SEGMENT IN GNB
<5 thous .
52 thous .
1,502 thous.
assets: PLN 200 thous. or PLN 10 thous. account receipts
PLN 24 billionassets
4%clients
48%assets
balance
assets: PLN 1 million
57 thousandclients
Where will we compete?
NEW SEGMENTATION OF CLIENTS
SEGMENT CRITERION SEGMENT STRATEGIC GOAL
< PLN 10k net incomeCritical mass of the clients base.The lion share in all proceeds.
>PLN 10 net income orPLN 200k assets
Significant share in capital adequacy and proceeds.
>PLN 1 million assets in the bank Liquidity security buffer.
Companies with simplified accounting(including automotive clients and other
market sectors clients)
Making use of the synergy with theautomotive business and the affluent
segment.
Where will we compete?
DEFINED MODEL OF SEGMENTS SERVICE
� Modernized Getin Bank network for acquisition and complex sale� Growing significance of remote service along with changing profile of clients� No dedicated advisors
� Dedicated advisor in Getin branches� Access to Noble branches� Advisors in branches� Priority call-centre� Dedicated (Premium) client interface in remote channels
� Private banking in Noble branches� Fully mobile bankers� Dedicated call-centre� Dedicated (Noble) client interface in remote channels
� Automotive business cooperation with retail branches network� Developing competences of Getin network advisors in service of the micro segment
FOR VIPs
SECURETRADITION
EVERYDAYBANKING
SOS RESOURCES
BARGAINSBANK
SELF BANKING
LIFEGUIDE
FINANCES in RELIABLE
HANDS
BANK 1.BANK 2.BANK 3.BANK 4.BANK 5.
BANK 13.BANK 14.BANK 15.
BANK 16.
BANK 7.BANK 8.
BANK 6.
BANK 12.
BANK 9.
BANK 10.BANK 11.
STA
BIL
ITY
DY
NA
MIS
M
BARGAIN
RELATIONSHIP
Based on the results of brand diagnosis carried out by Stratosfera by Deloitte
Where will we compete?
TO ACCOMPLISH THE VISION THE BANK NEEDS NEW POSITIONING
Getin Noble Bank 2016-2018
BANK WE CAN BE PROUD OF
HOW WE ORGANIZE
OURSELVES
GOALSAND
ASPIRATIONS
HOW WE WANT TO WIN
WHERE WE WILL
COMPETE
How we want to win?
MATURE BANKING CULTURE
SEGMENTATION� Specifying key segments for
the bank� Customer service fitted to
each segment
SALE NETWORK� One sale network� Optimisation – adaptation to
potential micromarkets
PRODUCTS� Products dedicated to
each segment� Increased profitability
from sustainable sources
MULTICHANNEL CUSTOMER SERVICE� Development of alternative
channels� Building digital strategy
DEVELOPING KEY SUPPORT COMPETENCES� MIS� IT� HR
CUSTOMER SERVICE� Quality-oriented� Adapting incentive, training,
and sale support systems
SALE SUPPORT
INCENTIVE AND BONUS SYSTEMS
ESTABLISHING GOALS AND EVALUATION SYSTEMS
How we want to win?
REDEFINITION OF GNB RETAIL CULTURE
� Goals and evaluation systems for customer service quality� Goals setting based on potential� Bigger share of solidarity goals
� Greater significance of quality issues� Stable incentive scheme� Standardized bonus amounts� Introduced non-financial bonuses� Corrective elements
� Efficient sale network support unit� Clear and integrated communication
with the headquarters� Auditing processes and standards in branches
Motivating sale networks to ensure high quality ser vice and sell products that ensure sustainable proceeds.
How we want to win?
PRODUCTS FOR RETAIL SEGMENTS
CHECKINGAND SAVINGSACCOUNTS(ROR)
GETIN UPattractive and popular account, free of charge for active clients
NOBLE PERSONAL ACCOUNTfree of charge for clients with minimum
assets of PLN 200 thousand or minimum monthly account receipts of PLN 10
thous.
NOBLE PRIVATE BANKING PERSONAL ACCOUNT
free of charge for clients with minimum assets of PLN 1 million, Noble Concierge
in the package
DEPOSITS new funds, traditional, progressive, foreign currencies, negotiable
like in the retail segment, but +0.1 p.p., plus rentier long-term
deposits
like in Noble segment,but +0.1 p.p.
INVESTMENTPRODUCTS
limited offer: GNB corporate bonds, short-term investment deposits, Group
TFI investment funds
the retail segment products plus: Group corporate bonds, selected
insurance products, TFI outside the Group
in limited scope
the affluent segment offer plus: other companies corporate bonds, selected insurance products, TFI outside the
Group
DEBIT CARDS
MasterCard StandardVisa Standard
MasterCard PlatinumVisa Platinum
Visa InfiniteMaster Card Elite
DT
2015
How we want to win?
PERMANENT REDUCTION OF FINANCING COST IS THE KEY ISSUE
DEPOSITS MIX, PLN billion DEPOSITS INTEREST RATE
Compression of mass segment margins
Supplementing capital adequacy with private banking
Promotion system targeted at deposits margins
Limiting acquisition of clients by TD price
Replacing them with clients who use transaction banking
2018
4%ROR
9%KO
87%DT
6%ROR
18%KO
76%*DT
2015 2018
42 432,9
2,01,6
0,1
1,9
0,4 ROR
KO
CHANGING OF DEPOSITS MIX AND PRICING
Campaigns to acquire new clients for SA
Migration of part of maturing TD to SA
ROR as an entry product
Significant role of the affluent segment
* In 2018, the share of traditional term deposits will amount to 65%, the remaining 11% will account for structured deposits with much better spreadTD – term deposit, SA – savings account, ROR – checking and savings account
How we want to win?
LOWERING COST OF DEPOSIT IS KEY
How we want to win?
ONE NETWORK APPROPRIATE FOR SEGMENTS
How we want to win?
CONSISTENT SERVICE IN ALL CHANNELS
Integration of call-centre units
New organisation of the network of branches
Integrated customer service and sale: front-office in branches and remote channels supported by CRM
Development of functionality and customer experience in mobile apps
Development of functionality and customer experience in online banking
360o customer view
BUILDING OMNICHANNEL COMPETENCES
BRANCHES ESSENTIAL FOR SALE OF COMPLEX PRODUCTS
DIGITAL STRATEGY ENHANCES EFFICIENCY AND X-SELL
INTEGRATED CUSTOMER SERVICE
IN CHANNELS ENHANCES CLIENTS LOYALTY
AND BOOSTS PROCEEDS
times GB active Client logs in to Getin Mobile app a year.
How we want to win?
MOBILE STRATEGY
Top MEx
Adequate customer service
Full functionality
Reliability
Building relationships with clients
How we want to win?
MOBILE STRATEGY
Top MEx
Adequate customer service
Full functionality
Reliability
� Dedicated apps� PSD2 as an opportunity, not threat� Evaluation at mobile store 4+
� NPS over 50� To 99% inquiries one answer is sufficient� Top 3 (2017 +) in Newsweek survey,
mobile contact with the bank
� Top 3 (2017+) in Newsweek survey, mobile functionalities
� 100% functionalities with IB
� 0 errors� SL 99.99%� Number of complaints < 0.1% Clients
How we want to win?
QUALITY MANAGEMENT
Continuous trainings
• Programme of regular trainings for sale and customer service staff members
Quality and remuneration
• Incentive systems that promote service quality
Strict customer service standards
• Format, lay-out, and branches equipment
• Customer service standards
• Complaints handling
Continuous process optimisation
• Dedicated process optimisation unit
• Process automation and simplification
• Work-flow system
• Identification and elimination of sources of complaints
Quality audit
• Mystery shopping
• Internal audit of standards
• NPS after visiting, bank and digital
• Complaints analysis
How we want to win?
HUMAN RESOURCES
Professional team at all levels
Zero tolerance to activities that have a negative impact on the
Bank's image
Enhancing internal communication
Increasing competences internally and acquiring new
competences through external recruitment
Service quality and Bank'svalues are an obligation for
each employee
Emphasis on recruitment criteria and selection of
candidates
How we want to win?
COOPERATION WITH PRODUCT COMPANIES
WAYS OF SUPPORTING THE BANK'S STRATEGY
� Development of secure investment offer for GNB mass sector� Offer of funds for affluent and private segments available in open architecture� Tailoring the Bank's service to needs of affluent clients as an opportunity to boost the AuM
� Integration of Noble Securities as part of the Bank's investment offer� Activation and integration of the offer for SMEs in cooperation with the corporate banking
� GNB's strategic partner in lease and car loans distribution� Enhancing the leader's position in financing car purchases� Cross-selling of corporate banking products to lease clients
How we want to win?
BUILDING A MORTGAGE BANK
In the long-run – a platform for financing mortgage loans
Reduction of mortgage loans volumes in
GNB's balance sheet
Reduction of mortgage products
financing cost
Getin Noble Bank 2016-2018
BANK WE CAN BE PROUD OF
GOALSAND
ASPIRATIONS
WHERE WE WILL
COMPETE
HOW WE ORGANIZE
OURSELVESHOW WE WANT
TO WIN
MAIN DIRECTIONS FOR THE 2016-2018 STRATEGY
RETAIL BANKING:Permanent improvement of profitabilitythrough building relationship banking
• Specifying new model of segmentation and retail clients service
• Increasing value of retail clients throughrelationship banking
• Revision and development of offeredproducts
• Optimisation and development of the branches network
• Development of channel competencesthrough developing omnichannel strategyand digital strategy
• Building new retail banking culture, including such aspects as KPIs, incentiveschemes, and sale support
• Sale networks and back-office processesoptimisation
• Increasing value for clients by establishinga dedicated unit in the bank as well as efforts in multi-channel customer service, complaints and products
• Reduction of financing cost through pricingoptimisation and building relationshipbanking
• Establishing GNB mortgage bank
RETAIL BANKING:
Efficient operational model with clear emphasis on the risk, HR, management information and IT competences
• Development of risk competences to create automated pre-approval processes for active clients of the bank
• Increasing the value of HR through activating talents, changing sale culture and approach to trainings
• Development of management information system (MIS) capacity for the entire organisation
• Optimisation and development of IT systems supporting all business lines
Transformation of Getin Noble Bank into a profitable and efficient universal generating profi t from sustainable resources
CORPORATE BANKING:
Keeping the leader's position in the automotive sector and further development of banking services for micro enterprises
• Defining new business and operational model for micro enterprises (segmentation, offered products, distribution channels)
• Enhancing the leader's position in the automotive sector, continuation of the niche strategy for SMEs, and organic growth in the sectors of real estate developers and local government units
STRATEGY OPERATIONALIZATION PROJECTS (1/2)
STRATEGIC INITIATIVES KEY ACTIVITIES
CLIENTS
1. New segmentation and customer service model
� Specifying new model of retail clients segmentation� Defining the affluent segment customer service model and dedicating affluent segment
advisors� Upgrade of processes among segment
2. Increasing value of retail clients
� Increased productization of new clients through efficient onboarding� Activating clients base through dedicated sale campaigns and development of CRM tools
� Creating mechanisms of building relationship with clients based on transactional checking and savings account leading to higher clients productization, loyalty and profitability
INVESTMENT3. Revision and development
of offered products
� Increasing products transparency through elimination of unnecessary products and promotions� Closing product loops in all segments� Creating an attractive entry product
CHANNELS / SALE
4. Optimisation and development of the branches network
� Integration of the sale network� Optimisation of the bank's sale network, as regards its structure, efficiency, formats
5. Development ofchannel competences
� Developing the omnichannel strategy allowing for integration of click-and-mortar channels � Developing the digital strategy with special emphasis on mobile banking as the distinguishing
trait
6. New culture of the retail banking line
� Verification of KPIs and evaluation and monitoring systems for sale in the headquarters and network
� Designing an incentive scheme that will promote client relationship building� Ensuring professional support for sale (helpdesk, IT, operations, MIS)
PROCESSES7. Sale networks and back-office
processes optimisation� Dedicating a unit to optimisation of the bank's processes and boosting their efficiency
� Revision of key processes and defining optimisation projects
STRATEGY OPERATIONALIZATION PROJECTS (2/2)
STRATEGIC INITIATIVES KEY ACTIVITIES
QUALITY 8. Increasing the value for clients� A unit dedicated to the quality assurance in the bank (among others customer service
processes, complaints, quality assessment)� Improving quality of multi-channel customer service, complaints processing, and products
FINANCING COST
9. Reduction of financing cost
� Reduction of financing cost through term deposits pricing optimisation� Changing financing mix towards checking and savings accounts� Structured deposits
10. Establishing GNB mortgage bank
� Transferring portfolio to the mortgage bank� Operational service for the mortgage bank
CORPORATE BANKING
11. Defining new business and operational model for micro enterprises
� Defining value proposition (products, sale channels, and service) for micro enterpriseswithin the retail banking line
� Defining operational model (organization, processes, risk, management model)
12. Continuation of the strategy in the segment of automotive business, real estate developers and local government units (business as usual)
� Defending the leader's position in the automotive sector� Continuation of the niche strategy as regards SMEs and organic growth in the sectors of real
estate developers and local government units
RISK, HR, MIS, IT
13. Development of risk competences� Automated pre-approval processes for active clients of the bank
14. Increasing value of HR � Expanding competences in the headquarters through selective acquisition of talents in the
market � Acquisition of competent advisors in the market that will promote changes in the sale culture� New approach to trainings for sale channels staff
15. Improvement of the quality ofof MIS
� Efficient tools for reporting and monitoring targeted at relations with clients (MIS)
16. Optimisation and development of IT systems
� Adapting systems to new banking model (360o client image, boosting x-sell)� Integration of front-en systems in GNB's sale networks (Getin, Noble, and franchise)� Development of the middle-layer supporting the bank's central system's operation
DISCLAIMER
This presentation (“Presentation”) has been prepared by Getin Noble Bank S.A. (the “Company”) for informational purposes only and may not, in any event, be considered or interpreted as an offer and/or a recommendation to enter into any transaction. In particular, it may not be considered or interpreted as an offer to acquire any securities or as an offer, invitation or incentive to make any acquisition offer, to make any investment or carry out any transaction involving such securities, nor may it be considered or interpreted as a recommendation to enter into any transaction, particularly any transaction involving the Company’s securities.You are cautioned against using this presentation as the basis for making a decision to purchase or sell securities.You are deemed to have represented and agreed that you and any customers you represent are either (a) qualified institutional buyers (within the meaning of Regulation 144A under the U.S. Securities Act), or (b) not a U.S. person and are outside of the United States and not acting for the account or benefit of a U.S. person (as defined in Regulation S under the U.S. Securities Act).Although information contained in this Presentation is based on generally available sources that the Company believes to be reliable, the Company cannot guarantee that this information is full and complete. The Company takes no responsibility for the consequences of any decisions based on any information contained in this Presentation. The information contained in this Presentation has never been subject to independent verification and may at any time be subject to change or modification.This Presentation contains forward-looking statements. Such forward looking statements are only predictions and are not guarantees of future performance. Any such forward-looking statements are subject to risks, uncertainties and factors relating to the operations and business of the Company that may cause the actual results of the Company to be materially different from any future results expressed or implied in such forward-looking statements.The Company is not required to publicly disclose any possible modification or change to any information, data or statement contained in this Presentation if the Company changes its strategy or intentions or if any unforeseen events or circumstances occur that affect the Company’s strategy and/or intentions.No information contained in this Presentation may, by any means, by considered or interpreted as a forecast or any express or implied representation or warranty whatsoever made by the Company or any person acting on behalf of the Company. In addition, neither the Company nor any person acting on its behalf shall be liable, in any way whatsoever, for any loss or damage that may be caused as a result of negligence or otherwise in connection with the use of this Presentation or any information contained in it, or for any damage that might otherwise arise in connection with any information contained in this Presentation. The publication by the Company of the data contained in this Presentation is not a breach of the regulations applicable to companies whose shares are traded on a regulated market, particularly on a regulated market of the Warsaw Stock Exchange (Giełda Papierów Wartościowych w Warszawie S.A.). The information provided in this Presentation has already been disclosed in current or periodic reports published by the Company or constitutes an addition to those reports, and its publication does not require the Company to fulfill the obligation to provide information as imposed on the Company as a public company. This Presentation does not purport to be complete. Please note that the only reliable source of information on the Company is the current and periodic reports published by the Company in performing its information obligations, available on the Company’s web site at www.gnb.pl. The Presentation is Confidential and should be treated as such and may not be copied or given to any other person, nor may the information contained therein be disclosed to any other person unless required by law. These materials are not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use is contrary to local law or regulations.
CONFIDENTIAL
GETIN NOBLE BANK MEETING OF SUPERVISORY BOARD
HELD ON 13 FEBRUARY 2014