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Investor Presentation
Innsbruck, May 2019
Investor Presentation04/30/2019 2
Hypo Tirol Bank AG 3
Our Customers 5
Tirol & Austria 6
Rating 10
Core Capital Ratio according to CRR/CRD VI 11
Some Key Company Figures 12
Own Investmnents (Nostro) 14
Funding 15
Pfandbriefe 16
Mortgage Pfandbriefe 17
Property Price Developements in Innsbruck & Austria 22
Public Pfandbriefe 27
Why Hypo Tirol Bank 36
Your Contact Person 37
Contents
Appendix 39
The Pfandbrief Law 41
Real Estate Cover Pool Pfandbriefe 44
Difference Pfandbriefe – Covered Bond 45
Investor Presentation
About us
04/30/2019 3
Focus: Core Market Tirol. On the one hand, the strategic commitment as a universal bank lies clearly in the core markets of North-, East- and South Tirol. In addition, Hypo Tirol Bank is active in the Vienna area with a selective customer and product focus.
Hypo Group encompasses 20 branches and a specialised unit for private banking and professionals in Tirol, a branch in Bozen, as well as a branch in Vienna. In addition, business customers are offered comprehensive advice throughout the Tirol from 3 locations.
Strong sole owner. Since its founding in 1901, Hypo Tirol Bank is owned 100 % by the State of Tirol.
Investor Presentation
Hypo Tirol Bank. Our regional bank
04/30/2019 4
Local connectedness. Hypo Tirol Bank sees itself as a partner to the State of Tirol, at the centre of which is the people of the region. This affinity which has grown since its formation in 1901 is reflected not only in its business orientation, but also in its economic, social and cultural commitment.
As a Tirolean tradition bank, Hypo Tirol Bank is particularly well positioned to help its clients:
• As a connoisseur of the domestic economy
• Close to customers and their everyday life
• Connected to the region, its people and its traditions
• Bound to the economic, social, cultural and scientific concerns and the successes of the country and its people
Investor Presentation
Our customers
04/30/2019 5
State of Tirol
Municipalities and cities
Country corporations
Entities
Non-profit housing developers
Support in all financial matters
A balanced range of investment products
tailored range of insurance products
funding know-how for private residential construction and for enterprises
modern account solutions
flexible financing options
Private clients
Corporate clients
Private banking &
liberal professions
Public Institutions
Investor Presentation04/30/2019 6
Factbox: Tirol• Tirol is the third-largest state in Austria, with 85% of the
country's surface area more than 1,000 m above sea level.
• 12% of the total area of Tirol can be settled. Around two-thirds of the land area is covered by the Alps and forests.
• Tourism. Tirol is Austria's most tourism-oriented state with 47.5 million overnight stays (in 2017). With 63 overnight stays per inhabitant, Tirol is tourism world champion.
• Science. The combination of good infrastructure, strategic location, scientific focus (universities, universities of applied science) and a wide range of leisure activities make Tirol an attractive region.
• Eight universities with over 47,000 students, more than 3,000 teachers and an annual budget of over 400 million euros.
• Expenses of the country for science and research 2015: 37.4 million euro. Research rate: 3.14 percent.
• Industry. Thanks to modern industrial settlements such as Swarovski, GE Jenbacher, Tyrolit, Adler Lacke, Plansee Group, Sandoz Kundl, Tirol is a sought-after location.
• Water kingdom. In Austria, which is blessed with water, around 2.5 billion cubic meters are consumed per year. This corresponds to about 3% of the quantity available per year.
• Renewable energy. By 2050, the entire energy supply will be covered by domestic, renewable resources.
• Family business. In Tirol, 85% of the companies are family-owned. (Location Tirol)
Investor Presentation
Short Profile: Tirol and Austria (1/2)
04/30/2019 7
Tirol Austria in %
Population/job market Inhabitants (12/31/2016) 749,853 8,811,782 8.5%
Unemployment rate (2016)EU comparison
3.3% 5.5%EU28: 7.6%
Gross added value at manufacturing prices (2016)
in EUR total 30.1 bn 329.9 bn 9.1%
primary sector (agriculture) 0.8% 1.4%
secondary sector (industry) 28.2% 28.3%
tertiary sector (services) 71.0% 70.3%
of which accommodation and catering1) 13.5% 4.9%
overnight stays winter (2014/15) 27.5 m 71.8 m 38.3 %
overnight stays summer (2015) 21.2 m 75.0 m 28.3 %
overnight stays per capita (2015) 64 16
Source: Statistik Austria, Eurostat1) Only data for the previous year (for 2016) available
Investor Presentation
Short Profile: Tirol and Austria (2/2)
04/30/2019 8
All values in percentages, unless otherwise specifiedSource: Austrian Chambers of Commerce,
Statistik Austria, Eurostat
2011 2012 2013 2014 2015 2016 2017
Real Austrian GDP growth rate +2.9 +0.7 +0.0 +0.7 +1.1 +2.0 +2.6
Unemployment rate 1)
– Austria 4.6 4.9 5.4 5.6 5.7 6.0 5.5
– Tirol 2.7 2.8 3.1 3.2 3.0 3.5 3.3
Debt level Austria (as % of GDP) 82.4 81.9 81.3 84.0 84.8 83.0 78.3
Public deficit (as % of GDP)
– Austria -2.6 -2.2 -2.0 -2.7 -1.0 -1.6 -0.8
– Tirol +0.05 +0.03 +0.02 +0.03 +0.01 ±0.00 -0.01
Inflation (HVPI Austria, 2015=100, in %) 3.6 2.6 2.1 1.5 0.8 1.0 2.1
1) Calculation of the unemployment rate by EUROSTAT according to the international definition (ILO)
Investor Presentation
Comparison of the federal states
04/30/2019 9
Federal State Rating
Salzburg
Vienna AA1
Tirol AA1
Vorarlberg AA1
Upper Austria AA1
Austria AA1
Styria AA2
Carinthia AA3
Lower Austria AA2
Burgenland AA2
Regional GDP per capita
30.000
34.400
36.100
38.100
42.060
43.100
44.900
45.200
50.000
50.100
0k 10k 20k 30k 40k 50k 60k
Burgenland
Lower Austria
Carinthia
Styria
Austria
Upper Austria
Vorarlberg
Tirol
Vienna
Salzburg
year 2018, in EUR
Source: Austrian Chambers of Commerce, Statistik Austria
Investor Presentation
Rating of Hypo Tirol Bank
04/30/2019 10
Non-guaranteed debts S&P Moody‘s
long-term A- Baa1
short-term A-2 P-2
subordinated Ba1
outlook stable stable
Guaranteed debts 1) Moody‘s
long-term A2
subordinated Baa2
outlook stable
Pfandbriefe Moody‘s
Public Pfandbriefe Aa1
Mortgage Pfandbriefe Aa1
1) Liabilities of Hypo Tirol Bank that were made up until and including 04/02/2003 and liabilities of Hypo Tirol Bank, which were established between 04/03/2003 and 04/01/2007, provided their term does not exceed 30/09/2017.
Investor Presentation
Core Capital Ratio *
04/30/2019 11
* according to CRR/CRD IV as of 31 December 2014, respectively according to Basel II as of 31 December 2013
9.5010.00
10.80
12.21
13.7014.51 14.6714.67 14.80 14.93 14.98
4.00 4.00
5.506.00
7.638.25
8.889.50 9.50 9.50
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
core capital capital conservation buffer systemic risk buffer
core capital ratio * forecast according to business plan
Regulatory framework:
Hypo Tirol Bank AG:
Investor Presentation
Some Key Company Figures
04/30/2019 12
Capacity Figures in million Euro 2014 2015 2016 2017 2018Balance sheet total 8,255 7,502 7,632 7,058 7,327
Receivables from clients 5,367 5,290 5,214 5,346 5,642
Liabilities evidenced by certificate 3,896 2,931 3,006 2,102 2,298
Equity capital according to Banking Act 562 562 567 585 604
of which Tier 1 449 480 505 519 530
Sales Figures in k Euro 2014 2015 2016 2017 2018Net interest income after risk provision 45,698 69.898 104,284 65,889 85,486
Net commission income 25,572 26,980 26,338 26,367 26,641
Administrative expenses -81,444 -79,561 -74,041 -72,673 -71,506
Operative result prior to change of specific credit risk -2,105 20,243 n.a. 1) n.a. 1) n.a. 1)
Consolidated result before taxation -18,485 67,289 38,262 22,015 41,458
Company Ratios 2014 2015 2016 2017 2018Equity capital ratio under CRR/CRD IV 2) 13.5% 14.3% 15.4% 16.3% 16.7%
Core Capital Ratio under CRR/CRD IV 2) 10.8% 12.2% 13.7% 14.5% 14.7%
Number of employees - annual average 566 513 519 512 516Liquidity Coverage Ratio (LCR) 3) 259% 159% 278% 259% 175%Net Stable Funding Ratio (NSFR) 99% 99% 84% 104% 109%Leverage Ratio gem. CRR/CRD IV (IFRS) 4.78 5.95 6.36 6.47 7.05
1) As of the 2016 financial year, Hypo Tirol Bank AG makes use of the option of IFRS 9.7.1.2, which is incorporated into EU law in November 2016, and directly reports the changes in its own creditworthiness risk in other comprehensive income. The operating result before changes in the creditworthiness risk of 2016 thus corresponds to earnings before taxes. The creditworthiness-induced fair value change in own liabilities in 2016 is -46,837 k EUR
2) According to CRR/CRD IV as of 31 December 2014, respectively according to Basel II as of 31 December 20133) According to CRR/CRD IV till 2014; according to delegated act EU/2015/61 since 2015
Investor Presentation
An Overview of the Figures
04/30/2019 13
Balance sheet total 1)in million Euro
Interest & commission income 1)in million Euro
Number of employees 1) Material expenditure 1)in million Euro
1) 2019-2020 = forecast according to business planning
8.2557.502 7.632
7.058 7.327 7.211 7.374 7.498
2014 2015 2016 2017 2018 2019 2020 2021
125 123112 103 117 104 107 115
2014 2015 2016 2017 2018 2019 2020 2021
566513 498 512 516
485 486 478
2014 2015 2016 2017 2018 2019 2020 2021
23,4 24,0 23,5 23,2 21,2 21,0 20,9
2014 2015 2016 2017 2018 2019 2020 2021
22,1
Investor Presentation
Own Investments (Nostro)
04/30/2019 14
Werte sind Marktwerte in Mio. EUR, sofern nicht anders angegeben; as of 31/12/2018
• Over 99% are denominated in EUR an in the bond portfolio
• TOP 5 Countries: Austria, Germany, the Netherlands, Norway, France – aggregated 67% of the portfolio
Portfolio Rating Share in %Market values in million EUR AAA 43.9
AA1 34.8
AA2 5.0
AA3 5.6
A1 2.4
A2 2.0
A3 3.4
BAA1 1.0
BAA2 0.9
BAA3 0.7
< BAA3 0.2
Covered Bonds392
Financials 84
Corporate Bonds 37Others 23
Government Bonds 656
Investor Presentation
Funding
04/30/2019 15
Anticipated issue volume Issue planning 2019
2019: 600 to 900 million EUR
2020: 600 to 900 million EUR
2021: 600 to 900 million EUR
Debt Maturity Profile (Issues)
Documentation
Secu
red
Un
secu
red
in million Euro
MTN Base Prospectus x x
PP: bearer notes, without prospectus x x
PP: registered notes, without prospectus x x
Schuldscheindarlehen x
Retail x x
Housing construction convertible bonds x
383
143
631
181 192
346
2019 2020 2021 2022 2023 2024
80 - 110 Mio
300 - 550 Mio.
50 - 80 Mio.
Private Placements
Sub-Benchmarks
Retail
Investor Presentation04/30/2019 16
The Austrian Pfandbrief
Hypo Tirol Bank has been an issuer of Austrian mortgage bonds for over 100 years.
Investor Presentation
Mortgage Pfandbriefe
04/30/2019 17
all values in EUR; data as at 03/31/2019
Cover pool
Total value of cover pool in EUR equivalent: 2.307.092.851
Assets in EUR 2.154.860.132
Assets in CHF 137.550.489
Assets in USD
Assets in JPY 14.682.230
Assets in other currencies
No derivatives may be dedicated to the cover pool.
Issues
in EUR 1.674.446.047
in CHF -
in USD -
in YEN -
Other currencies -
Investor Presentation
Share of loans in foreign currency in the cover pool
04/30/2019 18
• The reduction of the share of the mortgage cover pool in foreign currency is being continuously and actively worked on.
• No new customer requirements in foreign currencies are being included.
• Approx. 90% of the foreign currency share is made up of Swiss Francs.
• The appreciation of the CHF as a consequence of the deregulation of the exchange rate in January 2015 led to increased conversion activities from CHF to EUR.
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
Jun
20
12
De
c 2
01
2
Jun
20
13
De
c 2
01
3
Jun
20
14
De
c 2
01
4
Jun
20
15
De
c 2
01
5
Jun
20
16
De
c 2
01
6
Jun
20
17
De
c 2
01
7
Jun
20
18
De
c 2
01
8
Jun
20
19
Loans in Foreign Currency Forecast
6.6%
Investor Presentation
Maturity Structure
04/30/2019 19
all values in million EUR; data as at 03/31/2019
67
154
145
269
1.672
160
1.044
45
332
94
0 500 1.000 1.500 2.000
Remaining life up to 12 months
Remaining life > 12 to 36 months
Remaining life > 36 to 60 months
Remaining life > 60 to 120 months
Remaining life > 120 months
Issues
Cover pool
Investor Presentation
Distribution by Size
04/30/2019 20
all values in EUR; data as at 03/31/2019
9%
34%
9%7%
26%
15%
over 5,000,000
1,000,000 - 5,000,000
500,000 - 1,000,000
300,000 - 500,000
100,000 - 300,000
below 100,000
Investor Presentation
Geographical Distribution
04/30/2019 21
all values in EUR; data as at 03/31/2019
Germany (AAA)1%
Tirol (AA1)83%
Others 16% Vienna (AA1) 11,6%
Lower Austria (AA2) 1,9%
Burgenland (AA2) 0,9%
Salzburg 0,7%
Styria (AA2) 0,4%
Vorarlberg (AA1) 0,3%
Carinthia (AA3) 0,1%
Upper Austria (AA1) 0,0%
Investor Presentation
Property Price Developments in Innsbruck
04/30/2019 22
• Because of its topographical situation, Innsbruck has very limited land resources.
• From 2006 to 2017 the average price per m² for new housing developments increased by about 82% and for the resale of real estate by about 86%.
* Source: Property market report by prochecked Immobilien OG, Innsbruck (www.prochecked.at)Statistics bases on actually achieved sales transactions and on actual contractually agreed prices
2,6002,785 2,762
2,935
3,289 3,3273,517
3,9444,187
4,468
4,803 4,689
2,0061,839
2,0412,221 2,198
2,370
2,703 2,7313,008
3,2063,432
3,835
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Prochecked Property Price Index *
Ø price per m² in EUR
First saleResale
Investor Presentation
Property Price Developments in Austria
04/30/2019 23
• Property prices in Austria increased by about 72% from 2006 to 2017.
• In the period stated, the price development without the Federal Capital of Vienna was +63%.
• Thus, the development in the Federal State of Tirol is above that of the Austrian average excluding Vienna.
Source: Austrian National Bank. Index calculated on the basis of the EURO price per square metre for new and second-hand owner-occupied apartments and single-family houses.
100
120
140
160
180
200
220
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Austrian National Bank Residential Property Price Index (base = year 2006)
Austria
Vienna
Austria ex Vienna
Investor Presentation
Distribution by Property Type
04/30/2019 24
all values in EUR; data as at 03/31/2019
Distribution by property type in EUR
Residential 1.566.752.696
thereof private use, incl. Multi-family housing 1.121.871.918
thereof non-profit housing association 345.995.436
thereof buy-to-let 98.885.342
Commercial real estate 740.340.155
thereof retail 105.569.311
thereof office 122.810.164
thereof tourism / hotel 242.122.762
thereof agriculture 22.638.330
thereof industrial 109.283.971
thereof mixed use 74.341.412
thereof others 63.574.204
Total 2.307.092.851
Investor Presentation
Figures
04/30/2019 25
all values in EUR; data as at 03/31/2019
Some Key Figures of the Cover Pool in EUR/No/%Over-collateralisation nominal 38%Committed over-collateralisation 2,0%Over-collateralisation consistent with current rating 2,5%Moody's covered bond rating Aa1Number of assets 12.470 Number of borrowers 9.360 Average exposure per borrower in EUR 250.616 Average loan amount in EUR 188.113 Share of non-performing loans with at least 90 days past due 0,3%Share of 10 largest loans 4,6%Share of bullet loans 15,3%Share of loans in foreign currency 6,6%Share of loans with fixed interest rate for longer than 1 year 11,1%
Some Key Figures of the Issues in EUR/NoNumber of issues 37 Average issue size in EUR 45.255.299
Investor Presentation
Mortgage Cover Pool in Proportion to the Mortgage Pfandbriefe
04/30/2019 26
0
500
1.000
1.500
2.000
2.500
3.000
2019
2020
2021
2022
2023
2024
2025
2026
2027
in m
illi
on
EU
R
Mortgage Cover Pool Mortgage Pfandbriefe Mortgage Cover Pool incl. new business according to strategic planning
Investor Presentation
Public Pfandbriefe
04/30/2019 27
all values in EUR; data as at 03/31/2019
Cover pool
Total value of cover pool in EUR equivalent: 605.713.545
Assets in EUR 605.713.545
Assets in CHF
Assets in USD
Assets in JPY
No derivatives may be dedicated to the cover pool.
Issues
in EUR 425.000.000
in CHF -
in USD -
in YEN -
Other currencies -
Investor Presentation
Maturity Structure
04/30/2019 28
all values in million EUR; data as at 03/31/2019
18
47
27
207
308
310
75
10
0
30
0 100 200 300 400
Remaining life up to 12 months
Remaining life > 12 to 36 months
Remaining life > 36 to 60 months
Remaining life > 60 to 120 months
Remaining life > 120 months
Issues
Cover pool
Investor Presentation
Distribution by Size
04/30/2019 29
all values in EUR; data as at 03/31/2019
40%
32%
11%
7%
8%2%
over 5,000,000
1,000,000 - 5,000,000
500,000 - 1,000,000
300,000 - 500,000
100,000 - 300,000
below 100,000
Investor Presentation
Geographical Distribution
04/30/2019 30
all values in EUR; data as at 03/31/2019
Tirol (AA1)91%
Others
9%
Lower Austria (AA2) 6,6%
Styria (AA2) 0,9%
Carinthia (AA3) 0,8%
Upper Austria (AA1) 0,5%
Salzburg 0,4%
Burgenland (AA2) 0,0%
Investor Presentation
Distribution by Type of Debtor
04/30/2019 31
all values in EUR; data as at 03/31/2019
Distribution by type of borrower/ guarantor in EUR in %
Direct claim against sovereign - 0,0%
Direct claim against region / federal state 161.861.322 26,7%
Direct claim against municipality 289.695.339 47,8%
Claim with guarantee of sovereign - 0,0%
Claim with guarantee of region / federal state 214.666 0,0%
Claim with guarantee of municipality 153.852.333 25,5%
Total 605.713.545 100,0%
Investor Presentation04/30/2019 32
Tirol has the lowest per capita debt in comparison with the federal states
Werte in EUR; Quelle: Statistik Austria
0 1000 2000 3000 4000 5000 6000 7000 8000
Tirol
Vorarlberg
Upper Austria
Salzburg
Vienna
Burgenland
Styria
Lower Austria
Carinthia
Federal states indebtedness p.c. (2017) Municipalities indebtedness p.c. (2016)
Investor Presentation
Austrian Fiscal Equalization Scheme
04/30/2019 33
Source: http://www.ris.bka.gv.at
• First step: Distribution of Revenue
• Second step: intergovernmental transfers• Third step: other intergovernmental transfers
•shared federal taxestax sharing
• + exclusive federal taxes
• = federal profit shareFederation
• + exclusive provincial taxes
Distribution to the provinces („Länder“)Provinces
• + exclusive municipal taxes
Distribution to the municipalitiesMunicipalities
Ver
tica
lFis
calE
qu
aliz
atio
n
Horizontal Fiscal Equalization
Investor Presentation
Figures
04/30/2019 34
Some Key Figures of the Cover Pool in EUR/No/%Over-collateralisation nominal 43%Committed over-collateralisation 9,5%Over-collateralisation consistent with current rating 10,0%Moody's covered bond rating Aa1Number of assets 866 Number of borrowers 324 Average exposure per borrower in EUR 1.899.249 Average loan amount in EUR 710.574 Share of non-performing loans with at least 90 days past due 0,0%Share of 10 largest loans 35,6%Share of 10 largest exposures by borrower/ guarantor 14,9%Share of bullet loans 2,6%Share of loans in foreign currency 0,0%Share of loans with fixed interest rate for longer than 1 year 35,8%
Some Key Figures of the Issues in EUR/NoNumber of issues 8 Average issue size in EUR 53.125.000
data as at 03/31/2019
Investor Presentation
Public Cover Pool in Proportion to the Public Pfandbriefe
04/30/2019 35
0
100
200
300
400
500
600
700
2019
2020
2021
2022
2023
2024
2025
2026
2027
in m
illi
on
EU
R
Public Cover Pool
Public Pfandbriefe
Public Cover Pool incl. new business according to strategic planning
Investor Presentation
Why Hypo Tirol Bank?
04/30/2019 36
• Economically “healthy” and prosperous home market in Tirol
• Market dominating position with wealthy private customers, doctors, tourism operations and communities
• Stable ownership
• Bank of the State of Tirol since 1901
• Regional bank with short, efficient decision-making paths
• Many years’ experience as an issuer of mortgage and municipal bonds
• Issuance of mortgage and municipal bonds under the strict Austrian Mortgage Bond Act
• Over 80% of the mortgage cover pool is made up of properties in the core region of Tirol
Investor Presentation
Your Contact Person
04/30/2019 37
Chairman of the Board
Johann-Peter Hörtnagl tel.: +43 (0) 50700-2104 [email protected]
Treasury Divisional Director
Mag. Susanne Endl tel.: +43 (0) 50700-3200 [email protected]
Banking Book Management
Mag. Michael Blenke tel.: +43 (0) 50700-3210 [email protected]
Mag. Gernot Hackspiel tel.: +43 (0) 50700-3297 [email protected]
Robert Stern tel.: +43 (0) 50700-3296 [email protected]
Treasury Sales
Gernot Zimmermann tel.: +43 (0) 50700-3280 [email protected]
Markus Seeber tel.: +43 (0) 50700-3284 [email protected]
You can find more information on our website: www.hypotirol.com/ir
Investor Presentation
Disclaimer
04/30/2019 38
This presentation has been prepared by Hypo Tirol Bank AG. It is for informational purposes only and may not be passed on to a third party without the express, written consent of Hypo Tirol Bank AG.All information in this presentation is based on generally available sources, which Hypo Tirol Bank AG regarded as reliable at the time of gathering the information. Any liability or guarantee of Hypo Tirol Bank AG for the correctness, topicality and completeness of the information presented here is excluded. Errors and misprints excepted.
APPENDIX
Investor Presentation
Hypo Tirol MTN Base Prospectus
04/30/2019 40
Volume: EUR 4.5 billion
Bonds: covered and senior unsecured
Currency: EUR
Stock market listing: Luxemburg, Vienna
Arranger: Deutsche Bank
Applicable law: German law
Investor Presentation
The Austrian Pfandbrief Law
04/30/2019 41
• The issuance of mortgage and public Pfandbriefe is regulated in Austria by the Pfandbrief Law 1927 or Mortgage Banking Act 1899.
• Only the regional mortgage banks, the Mortgage Bond Divisions of the regional mortgage banks and two financial institutions may issue mortgage and public Pfandbriefe .
• There are current attempts to revise the Pfandbrief Law and Mortgage Banking Act as well as the Law on Covered Bank Bonds and to mould them into one collective piece of legislation.
• In order to be able to issue securities of this type, a cover pool must be adhered to, which is compiled differently for the relevant category:
Investor Presentation
The Austrian Pfandbrief Law
04/30/2019 42
Mortgage Pfandbriefe Public Pfandbriefe
Ordinary cover Ordinary cover
• Through mortgages in Austria, EEA, Switzerland • Loans to public corporations, regional governments and local regional authorities in A, EEC and Switzerland
• Loans with guarantees by one of these bodies
• Bonds from public corporations, regional governments and local regional authorities in A, EEC and Switzerland
• Bonds with guarantees by one of these bodies
Mandatory over-securitisation Mandatory over-securitisation
Investor Presentation
Mandatory Over-securitisation
04/30/2019 43
Furthermore, a mandatory over-securitisation (of 2%) in assets eligible for substitute cover is to be maintained.
Assets eligible for substitute cover are:
• Bonds from states, regional governments and local regional authorities from the EEA zone and Switzerland
• Bonds from domestic public corporations
• Bonds must be traded domestically or in an EEA regulated market. Credit balances at OECD central banks or EEA financial institutions
• Money in the sense of means of payment having been issued for circulation as legal
The amount of the substitute cover is limited to 15% of the mortgage bonds circulating (mortgage and municipal bonds in total). Since a 2% cover is to be maintained in assets eligible for substitute cover, there are thus only another 13% of the total mortgage bonds in circulation that can be held in assets eligible for substitute cover.
Investor Presentation
Real Estate Cover Pool Mortgage Pfandbrief
04/30/2019 44
100 % = Estimated value of the real estate
40 % deduction as a “security cushion” for loss of value, etc.
60 % of the real estate value (= lending limit) less any prior charges; however, a maximum of the outstanding loan amount is dedicated to the cover pool
The 60% threshold is anchored both in the statutes of Hypo Tirol Bank and in the Mortgage Banking Act
Over-securitisation for external rating
Pfandbrief issuevolume
In addition, 2% of the outstanding Pfandbrief issue volume must be held in substitute cover assets (securities).
60 %
40 %
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Cover pool Pfandbrief
Investor Presentation
Differences Mortgage Bonds – Covered Bond
04/30/2019 45
Pfandbriefe Covered Bonds
• No mortgage Pfandbriefe or covered bonds may be included in the mortgage cover pool
• For the mortgage cover pool, the mandatory over-securitisation is to be held in securities eligible for substitute cover
• Specialist bank principle for mortgage Pfandbriefe
• The bonds of a domestic public corporation, states, regional governments and local public authorities, as well as cash and credit balances in a central bank of Zone A or in financial institutions in accordance with Article 2 (20) of the Austrian Banking Act (BWG) are also possible for substitute cover for Pfandbriefe.
• Restrictions in respect of issues with a duration of more than 15 years for bonds.
• For the issues to be found in circulation, of the permissible cover values, in addition to the amount of the nominal value and bearing at least the same interest, the anticipated administration costs in the event of the bankruptcy of the issuing financial institution must be covered.
• Other covered bonds or bonds may be included in the covered bond cover pool.
• For covered bond cover pools, the mandatory over-securitisation is to be held in the permissible cover values.
• Covered bonds may be issued by every bank in Austria.
• Serving as substitute cover for covered bonds: cash and credit balances in a central bank of Zone A or in financial institutions in accordance with Article 2 (20) of the Austrian Banking Act (BWG)