BMW 2011 Annual Report Download - page 32

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tinued to be pursued in line with plan in 2011. The
bank’s expansion will provide greater flexibility in
terms of liquidity management and equity allocation.
BMW Leasing GmbH was successfully merged with
BMW Bank GmbH in August 2011.
Business expanded in new markets
The Financial Services operations set up in China in the
previous year made good progress during the year
under report. Business also developed well in India in
the first full
year of operations. Moreover, we also con-
tinued our strategy of regional expansion in 2011 and in
August a subsidiary was established for financial services
business in Poland.
Fleet business strengthened by acquisition
The BMW Group operates its international multi-brand
fleet business under the brand name “Alphabet”. In
September, the European Competition Commission
approved the acquisition of the ICL Group by the BMW
Group. As a result of this move we now have operations
in 15 countries and are meanwhile one of the top five
fleet service providers on the European market. As a
result of the acquisition, the portfolio of fleet business
financing contracts rose sharply by 128.8 % to 474,717
contracts (thereof 252,870 contracts of the ICL Group,
excluded the ICL Group: + 6.9 %). The expansion of fleet
management business is in keeping with the BMW
Group’s Strategy Number ONE, namely to be the world’s
leading provider of premium products and premium
services in the field of individual mobility.
Multi-brand financing well up on previous year
Multi-brand financing business was expanded signifi-
cantly once again in 2011, with new business increasing
by 13.8 % to 139,791 contracts. A portfolio of 370,999
contracts (+ 7.8 %) was in place at 31 December 2011.
Dealer financing expanded
The total volume of dealer financing contracts at the end
of the period under report amounted to € 11,417 mil-
lion, 12.4 % more than one year earlier.
Growth in customer deposit business
Customer deposit business represents an important ele-
ment of the BMW Group’s refinancing strategy. The
volume of customer deposits held at 31 December 2011
totalled € 12,039 million, an increase of 12.6 % compared
to the end of the previous year. This development was
boosted by the attractive deposit terms offered by BMW
Bank in Germany. At 31 December 2011, a total of 24,388
securities custodian accounts were being managed,
The strong growth of new business had a positive im-
pact on the overall size of the contract portfolio with
retail customers, increasing it to a total of 3,311,809
contracts (+ 12.8 %) at 31 December 2011. This figure
includes 252,870 contracts of the ICL Group. All regions
reported growth. The portfolios of the Europe / Middle
East region (+ 43.7 %) and of the Asia / Pacific region
(+ 10.4 %) expanded significantly compared to the pre-
vious year. The increase in Europe was primarily
at-
tributable to the acquisition of the ICL Group. The
contract portfolios for the Americas region and the EU-
Bank region climbed by 3.9 % and 2.8 % respectively.
Top spot for quality of service confirmed
The BMW Group’s Financial Services segment again won
numerous awards in 2011. In the annual survey on
quality of service carried out by the well-known market
research institute J. D. Power and Associates, the BMW
Group’s financial services operations in the USA achieved
top spot for the eighth time in succession in the category
“Dealer Financing Satisfaction Study
SM
”. In Canada, the
segment took first place amongst manufacturer- related
financial service providers in the two categories “Retail
Customer Credit Business” and “Retail Customer Lease
Business”. All of these awards are testimony to the
segment’s rigorous focus on providing customers with the
best possible service.
BMW Bank on track towards becoming a
Europe-wide bank
The strategy of turning BMW Bank Germany into a
credit institution with operations across Europe con-
18 COMBINED GROUP AND COMPANY
MANAGEMENT REPORT
18 A Review of the Financial Year
20 General Economic Environment
24 Review of Operations
24 Automotive segment
29 Motorcycles segment
31 Financial Services segment
33 Research and development
36 Purchasing
37 Sales
38 Workforce
40 Sustainability
43 BMW Stock and Capital Market
46 Disclosures relevant for takeovers
and explanatory comments
49 Financial Analysis
66 Internal Control System and
explanatory comments
67 Risk Management
73 Outlook
Contract portfolio retail customer financing of
BMW Group Financial Services 2011
as a percentage by region
Americas 31.8 Europe / Middle East / Africa 27.7
EU-Bank 30.9 Asia / Pacific 9.6
EU-Bank
Americas
Asia / Pacific
Europe / Middle
East / Africa