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The Ordinary General Meeting of Shareholders of Banco Sabadell was held today in Sabadell. 63,9% of the share capital was represented by both shareholders in attendance and proxies, and they have given a majority vote in favour of the management and results of the institution’s 135th year. They have also expressed their agreement with the proposed distribution of the net profit obtained during 2016, which stood at €710.4 million at year-end.
The Meeting has agreed to allocate close to €279.7 million as shareholder remuneration, to be paid at €0.05 per share. Of this amount, €0.02 per share was already paid in December 2016, and the remaining €0.03 per share will be paid on 7 April 2017. As part of the meeting agenda, Anthony Frank Elliot Ball was appointed as a new independent director of the bank. The appointment of independent director Manuel Valls was ratified and María Teresa Garcia-Milà Lloveras was re-elected, also as independent director. The re-election of José Luis Negro as executive director was also approved.
In his speech, Josep Oliu gave an overview of the importance of the Triple Plan 2014-2016 for the entity. He described the plan’s contribution as being “very positive”, highlighting the progress made in each of the plan’s three pillars: profitability, transformation - of both the balance sheet and sales - and internationalisation. OIiu emphasised that in just three years the bank has doubled its net interest income, achieved a reduction of its balance of non-performing assets and problematic assets that has exceeded expectations and has increased its international footprint, highlighting the fact that 32% of the entity’s performing loans are currently located outside of Spain. He also stressed that the entity has become a leader in service quality, and is ranked top in the Net Promoter Score (NPS) by large enterprises and SMEs, thanks to the bank's ability to “adopt new means of engaging with customers, our culture of being close to our customers, and our investments in technology”.
Josep Oliu has described the three years of the Triple Plan as being “crucial in ensuring the Bank is in a strong competitive position in relation to the other large Spanish banks and with a plan to create future value in the three geographies that we are targeting: Spain, UK and Mexico”.
Talking about 2016, the Chairman remarked that it was a year that was characterised by a more favourable economic environment and by the emergence of political phenomena which have cast uncertainty over the economic world and given rise to volatility in financial markets. Despite this economic environment, Mr Oliu emphasised that Banco Sabadell ended 2016 with a sound capital position, with a Common Equity Tier 1 ratio of 12%, which far exceeds the levels required by regulatory authorities.
When speaking about this year, the Chairman explained that “2017 is a transition year in which the primary objective is to complete the migration of the British franchise, TSB, to the bank’s technology platform, defending profitability through higher efficiency and steadily reducing the balance of non-performing assets”. Oliu indicated that work has already begun on the new business plan which will be completed in 2020 and which “will focus on expanding the business in the bank’s priority markets, namely Spain, the United Kingdom and Mexico. The plan will continue to strengthen our commercial and digital capabilities to enable us to stand out in the market due to our proximity, customer care and technology capabilities”.
The CEO’s speech
Jaime Guardiola, CEO, focused his speech on the management of the business and the key figures from 2016. In line with what the Chairman said, he highlighted the outstanding commercial dynamism that the entity has experienced during the Triple Plan and emphasised that “we ended 2016 as the bank with the best ratio of net interest income to average total assets in Spain, 1.69%, and we are also the entity that has increased that ratio the most over the last three years”.
Another notable aspect has been the decline in the NPL ratio by 749 basis points, and the 28% reduction of non-performing assets between 2014 and 2016, which has resulted in a substantial transformation of the balance sheet. Guardiola highlighted the bank’s digitalisation process, placing particular emphasis on the Remote Management service, a new relationship model with remote relationship managers which is currently already being used by 230,000 customers. One of the targets for this year is to increase this figure to 750,000 customers.
Speaking about 2016, the CEO said that “in a low interest rate environment, the entity has proven its capacity to generate ordinary revenues, thanks to our intense commercial activity”. He pointed out that Banco Sabadell has been a benchmark institution for companies once again this year, granting €38,672 million in funding and acquiring 96,239 corporate customers in 2016. As regards individuals, the granting of new home loans increased by 24.4%, and consumer finance increased by 46.4%.
The CEO also referred to the bank’s international activity, saying that in the UK, the TSB franchise has achieved its objectives and has also been rated as the best British high street bank in 2016. “Customer deposits increased by 13.6% while lending increased by 11.4%”, he said. He also remarked on the positive performance in Mexico, where lending increased by 69.1%.
Jaime Guardiola concluded that the positive performance of businesses and the results obtained “are a testament to the efficiency of our business model and to Banco Sabadell’s ability to create value while strengthening its capital and balance sheet on a sustainable basis”.
