frankfurt, 5 december 2013 - kfw bankengruppe...capital markets – press conference 2013 / 2014...

Capital Market – Press Conference 2013 / 2014

Frankfurt, 5 December 2013

2Capital Markets – Press Conference 2013 / 2014 ▪ Frankfurt ▪ 5 December 2013

Key financial figures of KfW Group (IFRS) 2013: Solid business performance, decreasing profit, very sound capital basis

2011 2012 1-9/2013Business activities (in EUR bn) – for the period

Promotional business volume 70.4 73.4 51.1

Income statement key figures (in EUR mn) – for the period

Operating result before valuation (before interest rate reductions) 2,426 2,781 1,792

Operating result before valuation 1,869 2,246 1,369

Consolidated profit 2,068 2,384 880

Consolidated profit before IFRS effects from hedging 1,900 2,229 938

Balance sheet (in EUR bn) – at the end of the period

Total assets 494.8 511.6 476.4

Equity 17.8 20.7 21.6

Volume of business 573.6 587.5 552.5

Key regulatory figures (in %)* – at the end of the period

Tier 1 capital ratio 15.4% 18.2% 20.6%

Total capital ratio 17.8% 20.6% 23.2%

*Calculated voluntarily for internal purposes on the basis of relevant legal regulations


KfW’s funding highlights 2013

› Lower funding needs: EUR 65.2bn ytd vs. EUR 78.7bn in 2012.

› More than 200 single transactions in 13 different currencies.

› 11 benchmark bonds in EUR and USD account for approx. 60% of total funding.

› The world’s only issuer able to offer all important maturities in EUR and USD.

› Among largest transactions ever by a non-domes- tic issuer in AUD and CAD with dollar 1bn each.

› Two further CNH issues after entering this prospering market in the previous year.

› Increasing importance of central banks as investors in USD bonds.

› Excellent funding conditions despite tightening spreads vs. Bund and peers.

› Among the world’s best ESG-rated financials.

AAAAAA AaaAaa AAAAAA

Top credit rating

Excellent ESG rating

Awards

Most Impressive Funding Team in its Sector

2. 2. 3. 3. 4 4 out of 192 out of 23 out of 127

Kangaroo Bond of the Year 2013

Among the top


Funding approach: proven three-pillar-strategy A well-structured range of products offers suitable opportunities for various investors‘ needs; increasing importance of benchmark pillar

›

Large and liquid bonds in EUR and USD

›

at least 3, 5 and 10 year benchmark maturities each year

›

Target benchmark sizes:›

EUR 3 – 5 bn

›

USD 3 – 5 bn

›

Large and liquid bonds›

in non-benchmark maturities with or without call option (EUR und USD)

›

in strategic markets (GBP, AUD, SEK, JPY, CNH, NOK, CHF …)

›

in further currencies

›

Other structured public bonds in various currencies

›

Customized products for investor needs

›

Flexible in currency, structure and maturity

2013: 11 transactions 2013: 106 transactions 2013: 90 transactions

Other public transactions Private placementsBenchmark programmes

30 November 2013: EUR 65.2 bn

60% 35%

5%


Investor base: a global approach assures high liquidity

1st pillar

Aggregate Placement of KfW EUR Benchmark Bonds 2009 through 20131

1 2013: based on allocation. 2008-2012: based on orders.

Europe ex GermanyGermanyAsiaAmericasOther

Central BanksBanksAsset ManagementInsurance & Pension FundsOther

EUR: stable distribution compared to 2012, regulatory driven demand still makes bank treasuries the largest investor group

1224 20 26

53

5254

50

2216 16

29

47

20 17

46458

0%

20%

40%

60%

80%

100%

2009 2010 2011 2012 2013

5137

5642

35

38

25

922 16

30

43

25 23

31

0%

20%

40%

60%

80%

100%

2009 2010 2011 2012 2013


Investor base: a global approach assures high liquidity

1st pillar

USD: demand from central banks (especially from Asia) increased by one third making them by far KfW’s largest USD investor group

Aggregate Placement of KfW USD Global Bonds 2009 through 20131

1 2013: based on allocation. 2008-2012: based on orders.

EuropeAsiaAmericasMEAOther

Central BanksBanksAsset ManagementInsurance & Pension FundsOther

22 2732 31

24

40 34 37

50

29 28 22

3 3 4 10

31

43

19

7

0%

20%

40%

60%

80%

100%

2009 2010 2011 2012 2013

35 41 3746

3130 36

25

30 27 21 22

61

24

1033

0%

20%

40%

60%

80%

100%

2009 2010 2011 2012 2013


Funding costsResult of current money market policy: KfW spreads vs. Bund have tightened, spreads vs. peers have tightened even more

›

Attractive yield pick-up of KfW bonds vs. Bund remains, though at a lower level›

Spreads throughout all asset classes have tightened considerably

Swap spread development of 5- to 7- year EUR-denominated bonds over the past three years (in basis points)

Sources: Markit, Commerzbank Research

-120

-80

-40

0

40

80

120

160

200

Nov-10 Feb-11 Jun-11 Sep-11 Dec-11 Apr-12 Jul-12 Oct-12 Jan-13 May-13 Aug-13 Nov-13

KfW Supranationals German Government Bonds Senior Unsecured Banks Covered Bonds

KfW vs. banks

KfW vs. Bund


›

11 benchmark bonds in 2013 making KfW the only issuer offering all important maturities in EUR & USD›

Among largest AUD & CAD issues ever by a foreign issuer with dollar 1bn each›

Two further CNH issues in 2013 after KfW entering this prospering market in the previous year

2012 30 November 2013

5%7%

32%

2%1% 4%

49%

EURUSDGBPAUDJPYSEKOthers

Currency mixCore currencies EUR and USD account for 87% of total – largest share ever; unfavourable swap dynamics in non-core currencies

39%

2%

4%2%

2%2%

48%

EURUSDAUDGBPJPYCADOthers


›

KfW’s proven capital market access during the entire year allows for smoothly adjusted timing pattern›

More even funding pattern reduced costs of carry during Q2 and Q3

Adjusted timing pattern in 2013 SSA issuers are typically front-loading, raising about two thirds of their funding during first half of the year

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

5yr-average

€11.7bn

2013€9.5bn

€2.5bn€2.4bn

€5.6bn

€5.2bn

€7.3bn

€1.6bn

€6.3bn

€10.2bn

€2.8bn

Total: ~ €66bn

Reduced pace of funding during Q2 and Q3


SRI eligibility of KfW bondsKfW follows a holistic approach which puts emphasis on the overall sustainability of the issuer

›

KfW is among the world’s best ESG-rated financials›

Approx. 40% of KfW’s new funds raised are for clean energy investments›

Approx. 6% of KfW’s new funds raised are for financings of developing and transition countries

›

Increasing awareness of investors to climate-themed or socially responsible investing.

›

KfW is by far the world‘s biggest player of broad clean energy investment with more than EUR 120bn since 2007. Source: Bloomberg – New Energy Finance 2013

›

KfW has been assigned top ESG* ratings by independent rating agencies:›

No. 2 out of 192 listed and non-listed banks,

›

No. 3 out of 23 financial institutions,›

Among top 4 out of 127 bond issuers in the financial sector.

* ESG = Environment, Social, Governance


79.7 76.475.3

65.2*

78.774.7

64.665 - 70

0

10

20

30

40

50

60

70

80

90

2007 2008 2009 2010 2011 2012 2013ytd 2014e

Funding volume Decreasing funding volume in 2013 due to high unscheduled repayments in lending business; outlook: reliable and strong presence in the capital markets

Funding volume (in EUR bn)

Benchmark bonds Public transactions Private placements* As of 30 November 2013

60%

35%

5%


KfW in 2014

› Strong presence in the capital markets with stable funding volume of EUR 65–70bn.

› Continuation of proven three-pillar-strategy.› Flexible approach with regard to timing, size,

products, and currencies.› No major changes in KfW’s mix of currencies and

instruments:› EUR and USD remain core currencies› Benchmark programmes remain key

› Possibly increasing competition between bond issuers in EUR due to change in swap dynamics.

› Continuation of strong focus on sustainable behaviour in all of KfW’s activities – including on the capital markets.

› Whatever the financial climate, KfW is well prepared for 2014.


Disclaimer

This document is provided for information purposes only. This document may not be reproduced either in full or in part, nor may it be passed on to another party. It constitutes neither an offer nor an invitation to subscribe or to purchase securities, nor is this document or the information contained herein meant to serve as a basis for any kind of obligation, contractual or otherwise. In all legal systems this document may only be distributed in compliance with the respective applicable law, and persons obtaining possession of this document should familiarise themselves with and adhere to the relevant applicable legal provisions. A breach of these restrictions may constitute a violation of US securities law regulations or of the law applicable in other legal systems. The information contained in this document is historical and speaks only as of its date. KfW disclaims any intention or obligation to update or revise the information contained in this document. By accessing this document you acknowledge acceptance of these terms.

Capital Market – Press Conference 2013 / 2014�Key financial figures of KfW Group (IFRS)�2013: Solid business performance, decreasing profit, very sound capital basisKfW’s funding highlights 2013�Funding approach: proven three-pillar-strategy�A well-structured range of products offers suitable opportunities �for various investors‘ needs; increasing importance of benchmark pillarInvestor base: a global approach assures high liquidityInvestor base: a global approach assures high liquidityFoliennummer 7Foliennummer 8Adjusted timing pattern in 2013�SSA issuers are typically front-loading, raising about two thirds of their funding during first half of the yearFoliennummer 10Funding volume�Decreasing funding volume in 2013 due to high unscheduled repayments in lending business; outlook: reliable and strong presence in the capital marketsKfW in 2014�Disclaimer

frankfurt, 5 december 2013 - kfw bankengruppe...capital markets – press conference 2013 / 2014...

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