Swedbank Ab Class A · OMXSTO:SWED_A
Swedbank Ab Class A — Q2 2016 Earnings Presentation
18 slides from Swedbank Ab Class A's earnings presentation, 2016
Slide 1: Swedbank's second quarter 2016 results
Swedbank’s second quarter 2016 results Birgitte Bonnesen (CEO), Anders Karlsson (CFO), Helo Meigas (CRO) © Swedbank
Slide 2: Swedish Banking: Strong result
Swedish Banking Strong result SEKm Q2 16 Q1 16 ▲ QoQ • Net interest income Net interest income 3 592 3 481 111 – Higher mortgage margins Net commission income 1 718 1 618 100 – Deposit margin pressure Other income 584 427 157 – Loan and deposit volume growth Total income 5 894 5 526 368 Total expens
Slide 3: Baltic Banking: Stable result
Baltic Banking Stable result SEKm Q2 16 Q1 16 ▲ QoQ • Net interest income Net interest income 954 934 20 – Mixed margin development Net commission income 498 483 15 – Loan volume growth driven by Other income 181 165 16 acquired portfolio in Latvia and Total income 1 633 1 582 51 Lithuania Total exp
Slide 4: Large Corporates & Institutions: Increased customer activity
Large Corporates & Institutions Increased customer activity SEKm Q2 16 Q1 16 ▲ QoQ • Net interest income Net interest income 827 764 63 – Higher lending margins Net commission income 610 498 112 – Deposit margin pressure Net gains and losses 545 403 142 – Loan volume growth Other income 21 25 -4 Tot
Slide 5: Group results: Strong result in challenging environment
Group results Strong result in challenging environment SEKm Q2 16 Q1 16 ▲QoQ • Net interest income Net interest income 5 732 5 623 109 Net commission income − Higher lending margins 2 795 2 645 150 Net gains and losses 877 400 477 − Loan volume growth Other income 2 466 638 1 828 Total income 11 870
Slide 6: Capital: Increased REA
Capital Increased REA Risk exposure amount • Higher mortgage and corporate SEKbn credit exposures 420 2.8 413.4 415 10.6 4.1 -2.8 -0.1 • Negative PD migrations 410 405 398.8 • Increased collateral values 400 395 390 • Visa increased REA by SEK 4.1bn 385 – temporary 380 375 370 Q1 2016 Exposure Visa
Slide 7: Capital: Strong capitalisation – no excess capital
Capital Strong capitalisation – no excess capital CET1 capital ratio, % • CET1 capital increased by SEK 0.3bn 24.1% 23.7% − Positive effect from net profit of 23.0% 23.0% 20.3% SEK 1.8bn (excl. dividend) − Negative pension liability (IAS19) effect of SEK 1.4bn • REA increased by SEK 14.6bn Q3 2015 Q
Slide 8: Asset quality: Solid asset quality
Asset quality Solid asset quality Credit impairments, SEKm Q2 16 Q1 16 ▲QoQ • Impairments related to oil exposures Swedish Banking -35 -13 -22 Baltic Banking 50 -42 93 Large Corporates & 545 97 448 Institutions Swedbank Group 538 35 504 Ratios Q2 16 Q1 16 Credit impairment ratio, % 0.14 0.01 Share o
Slide 9: Asset quality: Provisions in oil related sectors
Asset quality Provisions in oil related sectors • Loan portfolio negatively impacted 10 Shipping & Offshore, loans, SEK 31bn 9 2015-12-31 2016-06-30 by lower oil price, SEK 18.4bn 8 60% of the portfolio is negatively 7 impacted by lower oil – 1.3% of the total loan book 6 5 price 4 – Derivative expo
Slide 10: Q&A
Q&A Birgitte Bonnesen (CEO), Anders Karlsson (CFO), Helo Meigas (CRO)
Slide 11: Appendix
Appendix Swedbank @ a1
Slide 12: Swedbank – a low-risk bank with strong capital base
This is Swedbank Swedbank – a low-risk bank with strong capital base • Low risk – a Board of Directors’ strategic priority – ensures access to funding markets and low funding costs • Retail profile and four home markets a key feature – 86% of total loans originated in Sweden - Swedish mortgages acco
Slide 13: Swedbank – strong and stable earnings capacity
This is Swedbank Swedbank – strong and stable earnings capacity • Four home markets – Sweden, Estonia, Latvia and Lithuania – Strong and stable economies – Market-leading position in all home markets – Largest customer base in all home markets • Retail profile ensures stable earnings with low volati
Slide 14: Swedbank – market leader in cost efficiency
This is Swedbank Swedbank – market leader in cost efficiency • Best-in-class cost efficiency – an executive management strategic priority • Executive management strongly focused on cost and change management − Integrated in corporate culture − Focus on straight-through-processing − Evolving househol
Slide 15: Asset quality: Conservative PD assumptions
Asset quality Conservative PD assumptions • Five consecutive years with higher estimated losses compared to realised losses • Realised losses were higher than expected losses only during the Baltic crisis in 2009 Swedbank – Safety margins high in all exposure classes, PD % % Corporate % Retail mortg
Slide 16: Liquidity and funding: Conservative funding position
Liquidity and funding Conservative funding position • LCR 138% (Swedish FSA definition FFFS 2012:6) • NSFR 108% (Basel committee) • Issued SEK 104bn of term funding YTD Q2 2016 • Initial plan to issue around SEK 180bn in 2016 – most likely lower due to inflow of deposits Term funding issuance – comp
Slide 17: Long-term funding maturity profile
Liquidity and funding Long-term funding maturity profile Long-term funding maturity profile, by funding source Long-term funding maturity profile, by currency SEKbn SEKbn 200 Senior unsecured debt Covered bonds 200 150 150 Other GBP 100 100 USD EUR 50 50 SEK 0 0 2016 2017 2018 2019 2020 2021 2022- 2
Slide 18: Real estate price performance – Sweden, 12 month
Swedish housing and mortgage market Real estate price performance – Sweden, 12 month Single-family homes1 Tenant-owner rights2 Combined3 12M Δ 12M Δ 12M Δ Jul 15 14% 18% 15% Aug 15 13% 19% 15% Sep 15 14% 20% 16% Oct 15 18% 19% 18% Nov 15 13% 18% 15% Dec 15 12% 17% 14% House price index, Sweden3 240