BB Mapfre SH1 - Banco do Brasil

Institutional Presentation
1Q13
BB Seguridade
Largest Insurance, Pension and Premium Bonds Company in Latin America
Fast Growing with High Profitability
Largest Insurance Broker in Latin America
Largest Life Insurance Company in Brazil
2nd Largest P&C Insurance Company in Brazil
Leading Presence in Other Segments, such as Premium Bonds, Property and Rural Insurance
Insurance Operations, Pension Plans and Premium Bonds Managed Through Private Partnerships with
Global Leaders
Successful Track Record
2013*
IPO BB Seguridade
Equity investment in IRB –
Brasil RE
2012
Brasildental
Partnership with
Creation of BB Odontoprev
Seguridade
2011
Established
Joint Venture
with Mapfre
2008-2011
1996
1992
1981
1987
Creation of
BB’s
insurance
operations
BB Corretora’s
establishment
Creation of
Brasilprev
1995
Brasilcap’s
inception in
partnership
with
SulAmérica,
Icatu and
Aliança da
Bahia
Creation of
Brasilveículos in
partnership with
SulAmérica
Ownership
restructuring of
1999
BB’s insurance,
Partnership
Pension Plans and
with Principal
Premium Bonds
Financial
division
Group in
Private
Pension Plans
* Strategic moves announced after the release of first quarter results. Pending approval by regulators, supervisors and inspectors.
Organizational Structure
Shareholders General Meeting
Fiscal Council
Board of Directors
Audit Commitee
Executive Officers
CEO
Marcelo Augusto Dutra Labuto
Finance and Investor
Relations Directorship
Commercialization
Directorship
Products & Communication
Directorship
Leonardo Giuberti Mattedi
André Luis Cortes Mussili
Ângela Beatriz de Assis
Shareholders Structure
Free-Float
33,75%
66,25%
100% Total
100% Total
BB Seguros
BB Corretora Holdings
BB Mapfre
SH1
Mapfre
BB SH2
Brasilprev
Brasilcap
IRB –
Brasil Re 1
Brasil
dental
BB Corretora
BB Seguridade Stake in
Terms of Total Shares (%)
74,9%
50,0%
74,9%
66,7%
20,5%
74,9%
100%
BB Seguridade Stake in
Terms of Voting Shares (%)
49,9%
49,0%
49,9%
49,9%
20,5%
49,9%
100%
50%
50%
50%
67%
20%
50%
100%
Board of Directors
Representation (%)
Strategic moves announced after the release of first quarter results. Pending approval by regulators, supervisors and inspectors.
1 Participation in the amount of shares in IRB – Brasil Re after the Extraordinary Shareholders Meeting, expected to ago/2013.
Corporate Governance Overview
Presidents, Vice Presidents and Directors
Board of Directors
18 members
SH1
Life
9 appointments
9 appointments
18 members
SH2
P&C
9 appointments
9 appointments
16 members
Brasilprev
Pension
Plans
Companhia de Seguros
Aliança do Brasil
6 appointments
6 appointments
6 appointments
6 appointments
6 appointments
Aliança do Brasil Seguros
S.A
8 appointments
Mapfre Affinity
Seguradora S.A
Mapfre Seguros Gerais
S.A
6 appointments
6 appointments
6 appointments
6 appointments
2 appointments
6 appointments
6 appointments
6 appointments
3 appointments
3 appointments
4 appointments
2 appointments
3 members
Source: BB Seguridade and Banco do Brasil
Brasilveículos
2 appointments
2 appointments
Broker
BB Mapfre Assistência
6 appointments
12 members
Brasilcap
Premium
Bonds
Vida Seguradora S.A
6 appointments
8 appointments
8 appointments
Mapfre Vida S.A
3 appointments
Market Leadership
Outstanding distribution capabilities...
Market Share of BB Branch and BB Seguridade (%) – Positioning
BB’s Branches Market Share: 24.1%
BB Seguridade Market Share: 23.4%
BB branch market share (Feb/13)
BB Seguridade’s overall market share¹ (04M13)
1º
33.1%
1º
Benefits from BB’s leadership in high growth
insurance markets
33.8%
1º
2º
29.1%
15.4%
Northeast
(13.5% of Brazil’s GDP)
3º
1º
24.9%
North
(5.3% of Brazil’s GDP)
20.1%
1º
Southeast
(55.4% of
Brazil’s GDP)
1º
35.6%
28.2%
1º
1º
24.9%
31.2%
Mid-West
(9.3% of Brazil’s GDP)
South
(16.5% of Brazil’s GDP)
Source: Company, Susep and IBGE
1. Considering market share of Life, Casualty and Auto insurance premiums and total contributions from Pension Plans and Premium Bonds
2. Brazil’s GDP as of 2011 according to IBGE
Broker: exclusive access to BB network
…supported by the largest banking network in Latin America with multiple relationship channels
Banking Channel
Non-banking channel
59 mm clients
Sound non-banking network spread all over Brazil
Partnerships
Branches
5,394
138
1º
Points of sale
Banking Correspondents
ATM
60,220
Source: Banco do Brasil
18,165
4.290
Shared
External Brokers
28,380
20,000
Broker: exclusive access to BB network
SH1
SH2
Brasilprev
Brasilcap
Exclusive access to Banco do Brasil’s network
Access to BB Corretora
20-year term
Obligation to sell their products through BB Corretora’s banking network
No termination clause
Remuneration: fixed percentage of policies, in operational contracts signed
product by product
Signed in January 2013
Relationship managed by shareholder agreements with 23-year term for
PFG, 20-year term for Mapfre and indefinite for Icatu / Aliança do Brasil
Related Parties’ Transaction Policy
Enhanced transparency and certainty to minority shareholders
BB Seguridade’s commitment to reaffirm its best corporate governance practices
Creating a committee related parties, composed of at least one independent member, who must have a favorable vote for
approval and signature changes in contracts with related parties
Backed by BB and Private Partnerships
BB Mapfre SH1
SH1 Life
Life
Life comprehends life insurance, personal accidents and credit-life insurance
Life insurance products in Brazil are different from other modalities abroad. It is a non-accumulative product, which means that if a person does not contribute
anymore, the coverage will be suspended
Life insurers sell protection for events related to a person’s life, such as death protection (pay a fixed amount on the death of the policyholder), living benefit
products (income stream for retirement to the policyholder), personal accidents and savings-type products (insurance contracts that contain a trigger connected to
a person’s life)
Credit-life insurance allows for the liquidation of a debt or of a number of debt installments in the event of natural or accidental death or, in some cases, depending
on the product, unemployment or income reduction
Mortgage
Housing insurance is related to mortgage loans. In the event of the death of the insured, the insurance allows his or her family to retain the real estate and the
financial institution to receive full payment of any debt owed on the property. A housing insurance policy can also protect contractors against damage to real estate
BB Mapfre SH1
SH1 Life
Rural Insurance
Rural insurance protects farmers against adverse natural events, up to a maximum limit. It also covers cattle, farmer’s equity, farm assets, credit to commercialize
production, and the risk of death of producers
Life (Insurance Premium) (R$ mm)
Premiums
Housing (Insurance Premium) (R$ mm)
BB Seguridade: +13,5%
Industry: +17,2%
Market Share
17.8%
Premiums
BB Seguridade: +139,7%
Industry: +125,3%
Market Share
17.3%
4.9%
945.6
1,072.9
5.4%
27.4
19.9
1Q12
1Q13
1Q12
Rural (Insurance Premium) (R$ mm)
Premiums
BB Seguridade: +139,7%
Industry: +125,3%
Market Share
60.6%
64.4%
222.7
92.9
1Q12
1Q13
1Q13
Mapfre BB SH2
SH2 P&C
Property
The products of this segment are customized to insure individuals and companies against potential losses in their property assets – for example, to insure a
company’s machinery or facilities or an individual’s house against robbery or fire
Property insurance protects an entity or a person with an interest in physical property against its loss or the loss of its income capabilities
Casualty insurance protects an entity or a person against legal liability for losses attributable to injury to other people or damage to the property of others
Auto
Auto insurance is an insurance purchased for cars, trucks, motorcycles, and other road vehicles, which is primarily used to provide financial protection against
physical damage, bodily injury resulting from traffic collisions and against liability that could arise therefrom
Auto
Premiums
Market Share
15.0%
806.5
1Q12
(Insurance Premium) (R$ mm)
∆%
BB Seguridade: +29.0
Industry: +22.9
15.7%
1,040.0
1Q13
Brasilprev
Pension Plans
Complementary pension plans are an optional product giving individuals additional financial protection outside of public retirement plans
The two most important products in this segment are PGBL (Plano Gerador de Benefício Livre) and VGBL (Vida Gerador de Benefício Livre), which are pension plans in
which individuals contribute during their working lives in return for receiving a monthly income or a single payment usually upon retirement
PGBL products have a greater attractiveness to the middle class due to tax advantages (people who chooses the full statement of the income tax report can deduct the
contributions from the taxable income)
VGBL products have a greater attractiveness to high-income customers due to their succession appeal. The succession process in Brazil is costly and time consuming.
However, beneficiaries receive the resources quickly after the death of the policyholder
Pension Plans
Collection
Market Share
29.5%
4,408.2
1Q12
(Collection) (R$ mm)
∆%
BB Seguridade: +38.1
Industry: +27.1
32.1%
6,088.2
1Q13
Brasilcap
Premium Bonds
Premium bonds provide people with a way of saving money while also giving them the opportunity to profit from lottery premiums, in which randomly-chosen savers
are awarded prize money. A below-savings-account yield in capitalization plans allows people to participate in the lotteries
There are similar products in Spain and United Kingdom
There are 4 different kinds of premium bonds in Brazil: traditional (the objective is to refund the contributors at the end of the term if the contributor has made timely
and accurate contributions), programmed purchase (intended to facilitate the acquisition of a product or service at the end of the period, enabling the contributor to
choose between the purchase or withdrawal of their savings), popular (enables the contributor to participate in the lottery, but there is no refund of the amount
contributed) and incentive (a plan linked to a promotional event or a prize contingent on a behavioral or commercial event, without the refund of the entire amount
paid)
Premium Bonds
Collection
Market Share
23.0%
863.7
1Q12
(Collection) (R$ mm)
∆%
BB Seguridade: +26.6
Industry: +18.1
24.6%
1,093.5
1Q13
BB Corretora
Brokerage
The brokerage businesses consist in intermediating the sale of insurance products between the insurance company and clients
Due to the intermediation services, the broker receives a commission, which is calculated as a % of the value of the premium
There are no direct underwriting risks involved
Commercialization of BB Seguridade’s products in BB’s retail banking base
Commercialization process
Gross premium
SH1
SH2
Reimbursement
of costs /
expenses
Brokerage
BB Corretora
BB’s client
Brasilprev
Banking service fees
Brasilcap
Highlights
Insurance, Pension Plans and Premium Bonds
Distribution
Holding
Business Lines
SH1
Life1
Ranking
1st
3
SH2
P&C2
nd
Pension Plans
1st
9
Premium Bonds
Brokerage
1st
1st
1st
Net Revenues (1Q13)5
(R$ mm)
1,112
1,647
6,083
1,093
388
Adjusted ROAE6
(1Q13)
28.4%
4.4%
53.7%
63.4%
4,460.3%
34.7%
Adjusted net income
(1Q13) 7 (R$ mm)
133.1
12.3
95.7
16.9
193.6
454.9 6 8
% of BB Seguridade
adjusted net income 10
29.3%
2.7%
21.0%
3.7%
42.5%
Source: Company fillings and Susep
1. SH1 comprises Life, Housing and Rural Insurance / 2. SH2 comprises Auto, Casualty and Others (except for Housing and Rural Insurance) / 3. 1ST position: Represents BB Seguridade’s Life products / 4. 2nd position:
Represents BB Seguridade’s P&C products / 5. Premiums written for BB Mapfre SH1 and Mapfre BB SH2; Collections for Brasilcap; Contributions for Brasilprev; Operational revenues for BB Corretora / 6. Considers
adjustments for extraordinary items / 7. Considers the net income attributable to BB Seguridade / 8. BB Seguridade’s net income includes R$ 3.3mm related to holding revenues/expenses and taxes, which are not shown
above / 9. 1ST position: Represents BB Seguridade’s collections products / 10. Considers the results of holdings BB Seguridade, BB Seguros and BB Cor.
Earnings by Segment
Income from insurance, pension plans and premium bonds grows in all affiliates. Financial
result impacted by mark-to-market.
BB Mapfre SH1
Underwriting result
Mapfre BB SH2
(R$ mm)
Underwriting result: +71.4%
Net investment income: -32.2%
Adjusted net income: +18.8%
Net investment income
Adjusted net income
Underwriting result
Adjusted net income
70.1
218.7
127.6
81.0
1Q13
Brasilprev
Result with pension plan
Net investment income
Adjusted net income
127.3
123.5
89.4
55.0
1Q12
Underwriting result: +31.8%
Net investment income: -78.6%
Adjusted net income: -64.9%
Net investment income
177.5
149.4
24.6
21.5
16.3
1Q12
Result with pension plans: +9.1%
Net investment income: -12.4%
Adjusted net income: +0.3%
19.1
1Q13
Brasilcap
(R$ mm)
Result with premium bond
Net investment income
Adjusted net income
(R$ mm)
Result with premium bond: +71.8%
Net investment income: -150.8%
Adjusted net income: -47.9%
48.8
127.7
25.4
134.7
89.0
(R$ mm)
77.9
37.1
42.3
63.7
-21.5
1Q12
1Q13
1Q12
1Q13
Earnings by Segment
Adjusted net income 5% higher even in an adverse environment for financial income.
BB Seguridade Adjusted
Adjusted net income
ROAE (%)
431.9
(R$ mm)
Net income
Adjusted net income: +5.3%
37.8
BB Seguridade
(R$ mm)
ROAE (%)
Net income: +53.5%
36.2
34.7
454.9
26.0
472.0
307.4
1Q12
1Q13
1Q12
1Q13
BB Mapfre SH1 – Highlights
Adjusted ROAE grew fueled by growth in earned premiums and reduction in claims.
Earned premiums
20.7%
Claims
(R$ mm)
961.4
(%)
-8.0 p.p.
43.1
35.1
796.3
1Q12
1Q13
Combined ratio
1Q12
Adjusted ROAE
(%)
1Q13
(%)
-6.7 p.p.
84.0
28.4
77.3
21.5
1Q12
1Q13
1Q12
1Q13
BB Mapfre SH1 – Highlights
Banking channel sustains the growth of premiums written, in line with the business plan of
the company.
Premiums written
+19.0%
(R$ mm)
1,112.2
934.3
Breakdown of premiums 1Q12 vs 1Q13
1Q12
1Q13
DPVAT Housing
DPVAT Housing
Rural
7.0%
7.9% 2.2%
Rural
5.7%
2.4%
15.7%
x
76.2%
82.9%
1Q12
1Q13
Selling channels 1Q12
Life
Life
* Based on SUSEP GAAP
Selling channels 1Q13
Others Channels
Others Channels
20.0%
24.4%
75.6%
Banking Channel
80.0%
Banking Channel
Mapfre BB SH2 – Highlights
ROAE impacted by the financial result, but the growth in premiums earned and drop lower
loss ratio show favorable operating performance.
Premiums earned
Claims
(R$ mm)
+12.2%
1,364.7
1Q12
Combined ratio
(%)
-3.0 p.p.
1,531.2
57.8
54.8
1Q13
1Q12
1Q13
Adjusted ROAE
(%)
(%)
-0.2 p.p.
98.8
98.6
13.2
4.4
1Q12
1Q13
1Q12
1Q13
Mapfre BB SH2 – Highlights
Performance in auto insurance sustains the growth in premiums written, with the banking
channel showing the highest growth.
Premiums written
+22.9%
(R$ mm)
Breakdown of premiums 1Q12 vs 1Q13
1Q12
1,646.7
1,340.4
Affinity
1Q13
DPVAT
Affinity
9.8%
DPVAT
4.9%
4.5%
51.4%
34.3%
Casualties
1Q12
30.3%
56.7%
Casualties
* Based on SUSEP GAAP
Selling channels 1Q13
Banking Channel
Banking Channel
30.5%
Others Channels
x
1Q13
Selling channels 1Q12
69.5%
Auto
8.2%
Auto
34.4%
65.6%
Others Channels
Brasilprev – Highlights
Brasilprev reaches 43% of net total net inflow in the market, which has been supporting
the growth of reserves.
Gross revenue from pension plans
+38.5%
Adjusted ROAE (%)
(R$ mm)
6,083.4
68.0
53.7
4,390.9
1Q12
1Q13
Net Inflow of Contributions
(R$ mm)
1Q12
Technical Reserves
Net Inflow of Contributions
+34.0%
Market Share
41.2%
1Q13
43.5%
(R$ bn)
71.9
53.7
4,555.9
3,410.6
1Q12
1Q13
* Based on SUSEP GAAP. Net Inflow of Contributions = Collection - Redemptions
Mar/12
Mar/13
Brasilcap – Highlights
Growth in revenue and net inflow, with increased market share in reserves and collections.
Premium Bonds Collection
+26.6%
Adjusted ROAE (%)
(R$ mm)
1,093.5
167.2
863.7
63.4
1Q12
1Q13
Net Inflow of Contributions
Net Inflow of Contributions
Market Share
19.5%
(R$ mm)
1Q12
1Q13
Technical Reserves
+29.9%
29.1%
465.2
5.3
1Q13
Mar/12
(R$ bn)
6.8
241.1
1Q12
* Based on SUSEP GAAP. Net Inflow of Contributions = Collection - Redemptions
Mar/13
BB Corretora – Highlights
Benefits from the predominance of sales through the banking channel, increase of
commission income and net margin.
Brokerage Revenues
+21.2%
(R$ mm)
Revenues Breakdown 1Q12 vs 1T13
1Q12
387.6
319.8
Brasilcap
Other
SH1
14.4%
1.5%
46.2%
16.8%
Brasilprev
1Q13
Adjusted Net Income
(R$ mm)
+22.9%
1Q12
1Q13
11.8%
1.3%
19.7%
x
49.1% SH1
18.1%
SH2
SH2
Performance
(R$ mm)
1Q12
1Q13
Brokerage Revenues
Operating Result
Adjusted Net Income
319.8
231.8
157.5
387.6
284.3
193.6
Net Margin
49.3%
49.9%
193.6
157.5
Brasilcap Other
Brasilprev
21.1%
1Q12
1Q13
Contacts:
Investor Relations
SBS – Quadra 1 – Bloco A –
Ed. Sede I – 4º andar
70.073-900 – Brasília, DF
Tel: +55 (61) 3102-5771
www.bancodobrasilseguridade.com.br
[email protected]
Apresentação Institucional
Março 2013