The Ordinary General Meeting of Shareholders of Banco Sabadell was held today in Alicante. 61.35% 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 136th year. They have also expressed their agreement with the proposed distribution of the net profit obtained during 2017, which stood at €801.4 million at year-end.
The Meeting has agreed to allocate €281.3 million as shareholder remuneration, at €0.05 per share, which will be paid as of 27 April. In December the bank already paid €0.02 per share. Thus, total shareholder remuneration for 2017 amounts to €0.07 per share, representing a payout of 49%, i.e. €392.7 million.
As part of the meeting agenda, the Meeting approved the re-appointment of CEO Jaime Guardiola as executive director, David Martínez as proprietary director and José Manuel Martínez as independent director. The appointment of the two new independent directors, Pedro Fontana and George Donald Johnston, has also been ratified.
Chairman Josep Oliu has described 2017 as "an important transitional year that has placed the bank in a strong position from which to take on the three-year business plan for 2018-2020". Amongst other milestones, Oliu has emphasised the bank’s solid capital position, with a fully-loaded CET1 ratio of 12.0% pro forma following the implementation of IFRS 9. He also highlighted the good pace of reduction of non-performing assets, the decline of the NPL ratio to 5.1% and the progress made in the bank’s digital and commercial transformation - today it has 4.4 million digital customers. The Chairman of Banco Sabadell has also drawn attention to some of the most significant corporate transactions of 2017, such as the sale of Sabadell United Bank, which generated capital gains of €402 million, and the sale of HI Partners for €631 million.
Josep Oliu also referred to the technological integration of TSB, which is scheduled for completion this weekend. In this regard, he stated that "it has been an extremely complex technological and coordinated project, the completion of which demonstrates the capabilities of our bank, at a time when these are one of the most important elements of competitive differentiation It is the most noteworthy and commendable milestone in Banco Sabadell’s track record of acquisitions". The Chairman believes that the new platform provides TSB with a scalable and cutting-edge tool that "will allow it to extend its business to SMEs, become more efficient and make significant savings in terms of its technology expenses".
In his speech to shareholders, Oliu underlined the bank’s 29% revaluation in 2017, in contrast to the average revaluation of banks listed on the IBEX of 15.3%. In this respect, he noted that "this improvement represents the recognition of the strength of our banking business, the increase in solvency and the improvement of our balance sheet quality which have also led to a rating upgrade to the investment grade category by all three of the credit rating agencies that assign ratings to Sabadell".
The CEO’s speech
Jaime Guardiola, CEO, focused his speech on the management of the business and the key figures from the past year. In line with that indicated by the Chairman, he emphasised the five major achievements: the strengthening of the Group’s results, the improvement of the quality of the balance sheet, commercial activity growth, the leap in the bank’s digital and commercial transformation and leadership in customer service.
In terms of the Group’s results, Guardiola explained that the €801.4 million in profit has been achieved through "solid income growth from the banking business and strict cost management". Talking about the quality of the balance sheet, the CEO highlighted the reduction of €3.5bn in non-performing assets.
In relation to commercial activity, Guardiola expressed his satisfaction with the increase in lending and funds thanks "to the excellent performance of all of the Group’s business units". Regarding digital and commercial transformation, he noted that in Spain, 87% of transactions were carried out outside of branches and digital sales represented 20% of the total, a figure which increased to 59% in the United Kingdom. Lastly, in terms of customer service, he emphasised that Banco Sabadell is the leading bank in terms of customer experience in the companies segment.
The CEO ended his speech explaining the five key pillars of the strategic business plan for 2018-2020: improve profitability, place a greater focus on our brand and customer experience, strengthen our commercial and digital transformation, foster professional talent and develop the Group’s international franchises.