BANBAJÍO STRATEGIC PILLARS - DECEMBER| 2020
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BanBajío Strategic Pillars
December| 2020
UPDATE OF
RELIEF PROGRAM
2
Status of Relief Program as of November 30, 2020
As of September 30, 2020, the amount adhered to the relief program reached MXN
47,116 million, or 26.4% of the total portfolio, which will resume their normal
payment schedules according to the following timeline:
45% 42%
40% 38%
35%
30%
25%
20%
15%
13%
10%
5%
5% 2%
0%
SEPT OCT NOV DIC 2021
Relief Program Update
▪ Adhered portfolio as of Sep2020,
$ 47,116
million pesos
▪ % of portfolio that resumed pmt as of
84.5 %
Nov 30th
COMPANY
Behavior of payments from Sep to Nov TOTAL CONSUMER MORTGAGES
LOANS*
▪ Payment in full and partial 94.7 % 95.3 % 92.3 % 90.2 %
▪ No payment 5.3 % 4.7 % 7.7 % 9.8 %
* Includes Companies, SMEs, Financial Entities.
3
BANBAJIO STRATEGY
2020 - 2025
4
BanBajío Vision 2025
“To be the best Bank for Small, Medium
and Large Companies in Mexico, with
highly competitive Consumer Banking
products to give clients full service
satisfaction, through the use of market
intelligence and technology to generate
maximum efficiency.”
5
Strategic Pillars
I. Maintain and Increase our Leadership in
Small, Medium and Large Companies.
II. Moving forward with the Digital
Transformation.
III. Data Science and Analytics
IV. Stimulus to Consumer Banking and SMEs
V. Growing Clients Base and Cross-selling
Opportunities
VI. Best in Class Asset Quality
6Maintain and Increase our Leadership in Companies
• Since our beginnings we have been a bank with focus on Companies
and we have positioned ourselves as a leading bank in specialized
business lines such as Agrobusiness and SMEs. The acquired know-how
and the differentiated service proposition have led us to grow
significantly, placing us as the 8th largest lender in the corporate sector,
yet we continue to gain market share with an asset quality that is best
in class.
• In the following 5 years we will continue to increase our position in this
sector, giving continuity to what we have achieved so far, while
strengthening some segments that we have identify, such as:
Agrobusiness, Structured Loans, Construction, SMEs, Trusts,
International, Leasing and Factoring. The focus will be on a commercial
standpoint and complemented with a strategic sector risk analysis and
our business analytics and data science capabilities.
7Moving forward with the Digital Transformation
• During 2020-2021, as part of our Digital Transformation Process, we
intend to create a new platform with the latest technology available in
the market, making use of our analytical capabilities, with data
intelligence and algorithms, with the main goal of improving the
experience of our clients on our digital platforms. Our goal is that by
2021 all clients, both individuals and companies, have modern
electronic banking that is fully adaptable to their needs.
• In Personal Banking, in the fourth
quarter, we will release 100%
internet and mobile banking
access, completely redesigned,
offering efficient digital
solutions:
Bajionet | Bajionet Mobile | Bajionet Mobile Express
8Moving forward with the Digital Transformation
• For Businesses, in the first half of 2021 we will launch the Bajionet and
Bajionet Mobile platforms; and in the second half we will provide
differentiated services from our competitors through end-to-end digital
products such as:
✓ Ability to open Checking Accounts
✓ Obtain Business Debit Cards
✓ Payroll Services
✓ Access to Revolving Credit Lines
✓ On-line Payment to Suppliers
9Data Science and Analytics
In order to maximize the relationship between Personal and Companies
Accounts, we are establishing the framework through the integration of
two specialized areas: Data and Analytics and Consumer Credit, which,
coupled with the strategy to strengthen digital banking, will enable us to
generate additional revenue streams, thus having greater equilibrium and
stability in our future results.
For Data Analytics the first project that is in the implementation phase is:
Companies Engagement Index
In order to improve the profitability of our relation with Companies and
SMEs, we have developed an internal tool that will allow our employees to
better identify and quantify the client needs on an ex ante basis.
Furthermore, it will allow the RMs of the bank to exploit business relations
opportunities with tailored solutions, and focus on the service provided.
The rollout will occur during the 1st quarter of 2021.
10Data Science and Analytics
Future Projects
March 2021
Digital Onboarding and opening accounts
• Increase the engagement of our clients with the acquisition of our products in any channel
(Mobile, Web, Branches, Telephone) and with an origination process that is both user
friendly and efficient.
• Ability to start, continue or conclude the process on any channel.
Cross-selling “Always On”
• Tailored offerings always available to our clients.
• Continuous assessment of eligibility and pre authorization of product offerings, services,
and loans timely with the client’ needs.
Investments; Investor profile. Funds, Benchmark Pricing
• Identify the best investment offering for each client given their investment profile.
• Built investment simulators (Client and RM).
• Propose optimal blends of time deposits by client aligned with the treasury department.
11Stimulus to Consumer Banking and SMEs
Historically, BanBajío has been outstanding in Small, Medium and
Large Companies; currently we are also envisioning a sizable
opportunity in the Consumer and SMEs segments, for which we
have formed an alliance with FICO (Fair Isaac Corporation), a
leading software company in credit decision and predictive
modeling engines.
FICO will provide the strategic and operating intelligence with
parametrical decision engines and origination models, including
multichannel processes for immediate action and a risk
management platform for existing customers.
12Stimulus to Consumer Banking and SMEs
We have begun implementing this strategy, and in 2020 we carried out
2 cross-selling campaings with customers identified through the
analytical capabilities of the bank, and in 2021 we will carry out 5 more
campaigns for the TDC, payroll, personal, auto and mortgage
products; furthermore we will already have in place the ability to
originate loans based on parametric modeling.
Consumer Loans Applications
8,000
7,000
6,000
5,000
4,000
3,000
2,000
1,000
-
JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV
Applications received Applications from Cross selling
13Growing Clients Base
◥ TOTAL CLIENTS
*CAGR
JAN´17 - SEP´20
1,050,000 10%
1,000,000
950,000
900,000
850,000
800,000
750,000
700,000
* CAGR = Compound Annual Growth Rate
14Cross-selling Opportunities
2012 - 2020
5 4.82
4.74 4.79
4.8 4.64 4.63
4.6 4.43 4.4
4.4 4.28 4.27
4.2
4
3.8 Only 5% of our SME
3.6 Clients have a Loan
3.4 Product with us.
3.2
3
2.8 2.69 2.69 2.71 2.72 An SME borrower
2.61 2.62 2.64 2.64 2.64
2.6 2.73 generates 10x more
2.61 2.62 2.66 2.64 2.63 2.66
2.4
2.47
2.59 revenue than a non-
2.2 borrower.
2 1.89
1.79 1.78 1.84
1.75 1.73 1.77 1.75 1.88
1.8 1.62 1.84
1.75 1.87
1.6 1.74 1.73 1.71 1.80
1.68 1.67
1.4 1.57 1.56 1.61
1.53 1.54
1.44
1.2
1.29 1.35
Dic 2012
Dec 2012 Dic 2013
Dec 2013 Dic 2014
Dec 2014 Dic 2015
Dec Dic 2016
Dec Dic 2017
Dec Dic 2018
Dec Dic 2019
Dec 2019 Sep 2020
IVC Banco
CSI Total IVC Banca Banking
CSI Retail Comercial IVC Banca Empresarial
CSI Companies
IVC PymeBorrower
CSI SME Acreditado IVC con Nómina
CSI with Payroll IVC Pyme SME
CSI Total
15Best in Class Asset Quality
◥ NPL | % ◥ NPL Adjusted | %
3.3% 3.13% 6.5%6.42%
3.1% 6.0%
2.9% 5.5%
2.7% 4.73%
2.5% 5.0%
2.3% 4.5%
2.05%
2.1% 4.0% 3.35%
1.9% 3.5%
1.7% 1.55%
3.0%
1.5% 2.5%
1.3% 1.71%
1.1% 2.0%
0.87% 1.5%
0.9%
0.7% 1.0%
2014 2015 2016 2017 2018 2019 9M20 2014 2015 2016 2017 2018 2019 9M20
BANBAJIO SYSTEM BANBAJIO SYSTEM
◥ NPL by Segment| % ◥ Coverage Ratio | %
8% 240% 235.61%
6.95%
7% 220%
6% 200%
4.75% 4.44% 179.86%
5%
180%
4%
3.47% 160%
3% 132.66%
140%
2% 1.09%
0.70% 116.38%
1% 120%
0% 100%
2014 2015 2016 2017 2018 2019 9M20 2014 2015 2016 2017 2018 2019 9M20
Company Loans* Consumer Mortgages BANBAJIO SISTEMA
SYSTEM
* Includes Companies, SMEs, Financial Entities and Government.
16BanBajío Goals 2025
I. Maintain excellence in service to our clients, offering
competitive products through an omnichannel experience.
II. Improve NIM and decrease sensitivity to Interest Rates.
III. Strengthening and diversification of non-interest income.
IV. Higher organic growth, with growing client base and cross-
selling strategies.
V. Maintain best in class asset quality, penetrating new
segments with data intelligence.
VI. Improvements to bank efficiency, providing facilities for
Customer Service via web and mobile channels.
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