UNICREDIT FACTORING S.p.A. – ITALY UNICREDIT TIRIAC BANK ...storage0.dms.mpinteractiv.ro/media/401/781/10386/4966372/2/ales… · Unicredit Factoring, with a market share of 16,3%*

Factoring in crisis times – an opportunity? Italian & Romanian Markets outlook

UNICREDIT FACTORING S.p.A. – ITALYUNICREDIT TIRIAC BANK - ROMANIA

Bucharest , October 6th, 2009

Alessandro Bertoldo – Head of International Dept. – UniCredit Factoring S.p.A. - Milan

Presentation for Bucharest Conference:“HOW TO FINANCE YOUR BUSINESS THROUGH FACTORING”

2

AGENDA

INTERNATIONAL FACTORING MARKET AND UNICREDIT GROUP

ABOUT ITALIAN FACTORING MARKET

ABOUT ROMANIAN FACTORING MARKET

PRODUCTS & SERVICES PROVIDED

3





AGENDA

4

509 530587

684761

87082114 16

25

31

46

6268

115 105

110

136

141

150154

70 89

112

136

150

175 236

1620

26

30

36

44 47

2002 2003 2004 2005 2006 2007 2008

The worldwide Factoring market is over to 1.300 Billions Euro, mainly focused on Europe

760

860

1.017

1.134

724

72% 72% 71% 70% 71%% CEE + Western Europe/Total

Western Europe

CEE*AsiaAmericaAfrica and Oceania

Turnover, Billions Euros, Percentage CAGR ’02-’08

9%17%

14%

4%

7%

*

Source: Factors Chain International

Croatia, Cyprus, Czech Rep., Estonia, Hungary, Lithuania, Poland, Latvia, Romania, Russia, Slovenia, Slovakia, Turkey, Ukraine, Bulgaria

72%

1.3021.325

25%

68%

5

106

100

231

128

135

888

188

***


CAGR ’02-’08

Austria, Sweden, Portugal, Belgium, Finland, Norway, Denmark, Greece, Ireland, Luxemburg, IslandBulgaria, Croatia, Estonia, Lithuania, Latvia, Slovenia, Ukraine, Cyprus

Western Europe accounts for 92% of the total European market … but growth is concentrated in CEE

14,5

5,0

7,8

16,2

18,0

68,0

3,21,61,7

UK ItalyFrance Germany Spain Others* Total WE Turkey Russia Poland CzechRep.

Hungary SlovakiaRomania Others** Total CEE

3% 10% -1% 20% 18% 9% 7% 23% 92% 18% 17% 28% 42% 31% 20% 26%

2008, Market turnover, Billions of Euro, Percentage

Italy is the third biggest market in Western Europe …… while Turkey, Russia, Poland, and Czech Republic are the most relevant countries in CEE

6

Western Europe breakdown international vs. domestic factoring

CEE countries breakdown international vs. domestic factoring

International business is more important for CEE countries than for Western Europe

International

Domestic

274 113 107

65

79139

12 10 15

24

525

777

91

16,912,8

7,13,9

2,9

0,91,0

9,3

2,70,3

0,80,9

0,2

0,50,3

1,8

54,9

7,4

188 128 135 106 100 163 820

13%

UK Italy France Germany Spain Others* Total Western Europe

14%

18,0 16,2 7,8 5,0 3,2 1,6 1,7 14,4 67,9

Turkey Russia Poland CzechRep

Hungary Slovakia Romania Others** Total CEE

***

Austria, Sweden, Portugal, Belgium, Finland, Norway, Denmark, Greece, Ireland, Luxemburg, IslandBulgaria, Croatia, Estonia, Lithuania, Latvia, Slovenia, Ukraine, Cyprus


2008, Market turnover, Billions of Euro, Percentage

7

Factoring Utilization Attitude by European Countries

Sources: FCI Statistics, Eurostat, UCG Internal research

8

8

Countries where UniCredit Group already has a FactorCountries where UniCredit has its own banking network

Russia

Turkey

Bulgaria

RomaniaItaly

Germany

Croatia

Austria

CzechRep.

Hungary

Slovakia

Poland

Slovenia

Ukraine

Serbia

Bosnia

FCI Reports

Market share on Assifact sample

FACTORBANK , Vienna, covers the German Market until German local operations will start.

*

**

(1)

Area Country Turnover2008 (Bn €) *

Italy**

Austria

18,5

1,3

Turkey 3,2

Poland 1,2

Czech Rep. 0,1

Hungary

Russia

0,2

0,5

Romania 0,71

Bulgaria

Ukraine

0,4

0,43

Slovenia <0,1

Mkt share 2008 / Rank *

17,6% - 3º

17,3% - 2º

17,7% - 1º

15,4% - 2º

3,6% - 7º

4,7% - 4º

3,1% - 3º

38,9% - 1º

72,0% - 1º

32,8% - 1º

NA

Western Europe

CEE

Sources: UniCredit Group internal ProjectFCI Statistics

HVB Lithuania

HVB Latvia

HVB Estonia

UniCredit LithuaniaUniCredit LatviaUniCredit EstoniaPekao Faktoring

Unicredit BankCzech Republic

Unicredit FactoringHungary

FactorBank (1)

Unicredit FactoringITALY

Zagrebacka Banka

UniCredit Bank Serbia

Unicredit Factoring Bulgaria

UniCredit Tiriac BankRomania

Yapi Kredi Faktoring

JSCB “Ukrsotsbank”UniCredit Bank

Unicredit BankSlovakia

UniCredit Group 2008Total Factoring Turnover: EUR 26,5/Bios

UniCredit Group footprint is like no other in Europe, with factoring operations characterized by excellent local risk assessment and operational capabilities.

9

AGENDA





10

About Italian factoring market

85,4% 85%

14,6% 15%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

mar-08 mar-09

Factors from banking groups Captive

ITALY. Factoring market composition

Mar 08 Mar 09

� The cumulative Turnover in 2009 (Jan-Jun) was equal to Eur 56/Bios (-5,4% vs 2008 same period)

� The Receivables Outstanding as at 30.06.2009 was equal to Eur 39,7/Bios (+5,8%).

� The total Financial Exposures as at 30.06.2009 were equal to Eur 29,5/Bios (+11,3%)

� The Italian factoring market is dominated by factorsfrom banking groups (85,0% of the market)

� Unicredit Factoring, with a market share of 16,3%* , is the 3° factoring company on the market, having a significant increase, bothcompared to March 2008 (eg 12,7%), and December 2008 (15,2%)

� The domestic market is heavilyconcentrated, the first 4 competitorsregistering 67,5% of the total turnover, having increased 66,1% in December 2008

Source: Assifact

* As at 30 June 2009

MARKET SHARE AS AT 30.06.2009 Intesa Mediofactoring

22,4%

Ifitalia19,0%

UniCredit Factoring

16,3%

Factorit9,8%

Others32,5%

11

Totale clientela residente - Impieghi vivi (€ mld)

1.11

7

1.14

5

1.15

2

1.19

3

1.21

8

1.26

0

1.27

4

1.32

1

1.34

5

1.38

6

1.40

5

1.45

4

1.47

7

1.49

8

1.50

1

1.52

4

1.51

0

1.000

1.100

1.200

1.300

1.400

1.500

1.600

1.700

1.800

1.900

2.000

2.100

mar

-05

giu-

05

set-

05

dic-

05

mar

-06

giu-

06

set-

06

dic-

06

mar

-07

giu-

07

set-

07

dic-

07

mar

-08

giu-

08

set-

08

dic-

08

mar

-09

€ bl

n

0,0%

1,0%

2,0%

3,0%

4,0%

5,0%

6,0%

7,0%

8,0%

9,0%

10,0%

11,0%

Impieghi vivi Var. % A/A (Scala dx)

In Q1 2009 the banking loans underwriting growth kept on slowing down, although still in a positive trend

Italian financial system - Drill down ST vs MLT

Of which: <= 1 YEAR; 30,9%

Of which: > 1 YEAR; 69,1%

Of which: <= 1 YEAR Of which: > 1 YEAR

• As at March 2009 total loans amount to inland clientele was Eur 1.510/bios, with a growth of 2,2% Y/Y , although showing a constant decrease since the beginning of 2008

• The Loans to Corporates has a better growth rate (+3,5% as at March 2009), but showing a remarkable drop. They correspond to the 61% of the total loans granted by the Italian Banking System

• Factoring is identified as a Short Term facility (< one year) which as at March scored as the 30,9% of total loans granted by the Italian Banking System.

IMPIEGHI A CLIENTELA RESIDENTE - TASSI DI CRESCITA PER SETTORI

-7,5%

-5,0%

-2,5%

0,0%

2,5%

5,0%

7,5%

10,0%

12,5%

15,0%

17,5%

20,0%

22,5%

25,0%

set-

98

mar

-99

set-

99

mar

-00

set-

00

mar

-01

set-

01

mar

-02

set-

02

mar

-03

set-

03

mar

-04

set-

04

mar

-05

set-

05

mar

-06

set-

06

mar

-07

set-

07

mar

-08

set-

08

mar

-09

Pubblica Amministrazione Società finanziarieFamiglie e altro Soc. non fin. e fam. Prod..

Total loans – growth rate

Exposures % Var Y/Y (right)

Total loans to resident Corporate – growth rates per segment

12

The drop of the ST loans is mitigated by the self-liquidating component, mainly due to the Factoring activity

CLIENTELA RESIDENTE - ESPOSIZIONI AUTOLIQUIDANTI- CRESCITE ANNUE % -

-15,0%

-10,0%

-5,0%

0,0%

5,0%

10,0%

15,0%

20,0%

25,0%

30,0%

35,0%

giu-

99

dic-

99

giu-

00

dic-

00

giu-

01

dic-

01

giu-

02

dic-

02

giu-

03

dic-

03

giu-

04

dic-

04

giu-

05

dic-

05

giu-

06

dic-

06

giu-

07

dic-

07

giu-

08

dic-

08

Banks Factors banks & factors

IMPIEGHI TOTALI A CLIENTELA RESIDENTE - VAR % ANNUE -

-5,0%

-2,5%

0,0%

2,5%

5,0%

7,5%

10,0%

12,5%

15,0%

set-

99

mar

-00

set-

00

mar

-01

set-

01

mar

-02

set-

02

mar

-03

set-

03

mar

-04

set-

04

mar

-05

set-

05

mar

-06

set-

06

mar

-07

set-

07

mar

-08

set-

08

mar

-09

TOTALE RESIDENTI Di cui: ST Dfi cui: MLT

Until sep08 ST is considered <=1,5 Y and MLT is >1,5Y. Starting from dec08 ST is considered <1Y

C L IE N T E L A R E S ID E N T E - F IN A N Z IA M E N T I A U T O L IQ U ID A N T I (€ M L D )

-

1 5

3 0

4 5

6 0

7 5

9 0

1 0 5

1 2 0

1 3 5

1 5 0

1 6 5

1 8 0

1 9 5

2 1 0

2 2 5

2 4 0

2 5 5

2 7 0

mar

-04

giu-

04

set-

04

dic-

04

mar

-05

giu-

05

set-

05

dic-

05

mar

-06

giu-

06

set-

06

dic-

06

mar

-07

giu-

07

set-

07

dic-

07

mar

-08

giu-

08

set-

08

dic-

08

mar

-09

0 %

1 %

2 %

3 %

4 %

5 %

6 %

7 %

8 %

9 %

1 0 %

1 1 %

1 2 %

1 3 %

1 4 %

1 5 %

1 6 %

1 7 %

1 8 %

S e lf liq u id a t in g E xp o s u re s % g ra n te d b y fa c to rs

• As at March 2009 Short Term Lending shows aclear drop (-2,9%) while the MLT component still has a positive growth (+4,2%), although declining.

• Self-liquidating loans grow by the 1,3% mainly because of Factoring Companies impulse (+9,8%) while Banking System facilities are stagnant.

• The share market of the Factoring Sector in the self-liquidating lending keeps on growing. Aa at March 2009 they covered the 13,2% of the market (+1% compared to March 2008).

Total loans to resident Corporate – growth rates per segment

Total loans – self-liquidating lending growth ratesTotal loans – self-liquidating exposures (Euro Bios)

13

The credit insurance issueThe insolvency outlook

Source: National sources, Insurance Co. forecasts

Variation Y/Y 2009 2008The Netherland 75% 1%Hong Kong 71% 3%Norway 66% 28%Spain 58% 187%United Kingdom 56% 31%Ireland 55% 113%Slovakia 55% -27%Latvia 50% 21%USA 45% 54%Lithuania 40% 53%Danmark 40% 54%Estony 40% 112%Singapore 37% 25%EURO ZONE 35% 33%Sweden 35% 9%Insolvency Global Index 35% 27%Finland 32% 14%Italy 31% 45%Portugal 30% 67%Hungary 30% 15%Czech Rep. 28% -3%Poland 26% -10%France 25% 15%South Korea 25% 19%Germany 19% 0%Belgium 18% 10%Taiwan 18% -23%Switzerland 16% -2%Greece 15% 10%Japan 15% 11%Austria 15% 0%Luxemburg 15% -12%Canada 10% -2%China 10% 5%Brasil -8% -18%

DEFAULT RATE FORECAST� Due to the Global Crisis, the tremendous growth

of the default rate determined a upwards re-balancing of the pricing in the credit insurance market.

� In Italy in the first half 2009, the claims to Credit Insurance Companies increased by 52% compared to previous year, having negative consequences on policies price.

� UniCredit Factoring Credit Insurance recourse in 2009, deteriorated significantly (see below).

COMPARISON FIRST HALF 2008/2009

NUMBER AMOUNTS

REDUCTIONS + 20 TIMES + 41 TIMES

CANCELLATION +137% +460%

REFUSALS +64% +150%

NEW GRANTS

FULL +21% -17%

PARTIAL +214% +381%

REQUESTED

AMOUTS

GRANTED

AMOUT1H REDEMPTION

415.206.500 332.065.000 2008 79,98%

642.391.000 358.745.000 2009 55,85%

*

*) From Eur 44/mios to Eur 249/Mios

Amounts in Euro

14

AGENDA





15

About Romanian factoring market

BRD28%

Compania de Factoring

10%

ING5%

UniCredit32%

BCR Erste11%

Raiffeisen6%

Sterling, Direct Factor &others

3%

RBS5%

• UniCredit Tiriac Bank , with a market share of 32%, is the 1st factoring company on the Romanian market . Regarding tranditional factoring volumes, August 2009 compared with same period in 2008 shows a significant increase of 41%.

• Romanian Market is still dominated by banks and heavily concentrated, the first 3 players registering 71% of the total turnover.

16

220300

500

1003

1841

10 13 20 23109

190238 230 198 215

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2004 2005 2006 2007 2008

Domestic Import Export

About Romanian factoring market

Due to current market constraints (mainly related to real estate collaterals value drop and follow-up requirements), the companies’ access to traditional short term financing facilities has been limited this year. As a consequence, both Banks and companies turned to factoring products, characterized by flexibility in financing as well as by receivables and cash management services outsourcing, without the burden of identifying and evaluating additional collaterals.

17

AGENDA





1818

UniCredit Factoring groupwide currently has a product portfolio covering all main product categories

Products Main characteristicsService Components

+

+

Financial � Working capital financing depends on value and quality of the debtors

Operational � Monitoring of debtors

� Management of payment collections

Risk Coverage(only in non recourse factoring)

� Coverage of debtors insolvency risk

Domestic factoring

Maturity factoring

Reverse factoring

Import factoring

Export factoring

Credit mgmt for state owned entities

Full factoring

Source: UniCredit Group internal project\

� Coverage of debtors insolvency risk (in non recourse)

� Financing for the buyer

� Payment of the supplier at a certain date (fixed) by the factor

� Post financing for the buyer

� Agreement with large corporate with many and continuous suppliers

� Recourse/non recourse credit line for the debtor� Financing of suppliers� Profit sharing with large corporates

� Non recourse credit line and for foreign supplier� Post financing for the Italian buyer

� Coverage of foreign debtors insolvency risk

� Generally non recourse� Days Sales Outstanding (DSO)

� Recourse/ non recourse, on the totality of receivables portfolio

19

4. Risk Protection(Coverage previously granted)

D

Factoring International transactions – Example of co-operation

Seller/Exporter

Buyer/Importer

1. Goods delivery

2. Receivables assignment

5. Collection

2. Export financing

3. Risk assessment

- Operating with factoring, the non-payment risk is on the import factor’s side

- The assignor receives financing deducted of factoring commissions and interests on advance financing

Non payment risk

A

C D

E

B

* Filing approval and financing could be performed by other UniCredit Group companies

Unicredit Factoring Local Units

20

Only few steps to benefit of international factoring

1. The seller contact the UCTB local factoring expert2. First assessment for the operation feasibility3. UCTB expert communicate to UCF (Milan or other entities) the operation details for deep assessment 4. UCF inform the UCTB expert about the results and after send a proposal to the Exporter5. In case of acceptance direct negotiation will start between UCTB and Romanian Exporter6. Start of operations (receivables assignment vs. financing

* Filing approval and financing could be performed by other UniCredit Group companies

1. First contact

2. Feasibility

3. Deep assessment

4. Proposal

5. Negotiation 6. Operations

..

. .

21

THANK YOU FOR YOUR ATTENTION

Alessandro Bertoldo Andreea MarinescuHead of International Department Director FactoringUniCredit Factoring Spa UniCredit Tiriac BankVia Albricci, 10 Strada Gheţarilor, nr. 23-2520122 Milan (Italy) Bucureşti – Sector 1+39-02-366 71024 +40-21-200 1690+39-335-619 8669 (mob) +40-728-132270

Documents

UNICREDIT FACTORING S.p.A. – ITALY UNICREDIT TIRIAC BANK ...storage0.dms.mpinteractiv.ro/media/401/781/10386/4966372/2/ales… · Unicredit Factoring, with a market share of 16,3%*