Danske Bank A/s · OMXCOP:DANSKE
Danske Bank A/s — Debt Investor Presentation (February 2015)
29 slides from Danske Bank A/s's debt investor presentation, February 2015
Slide 1: Danske Bank Additional Tier 1 Capital Investor Presentation
Danske Bank Additional Tier 1 Capital Investor Presentation February 2015
Slide 2: Agenda
Financial results for Q1 2013 Agenda Executive summary 3 Overview 6 Financial results 9 Capital, liquidity & funding 14 New issue 19 Q&A 27 2
Slide 3: Executive summary: Danske Bank in brief
Financial results for Q1 2013 Executive summary: Danske Bank in brief Macro-economic Operates principally in AAA rated Northern European countries: the largest Danish commercial operating bank with a strong footprint across the Nordic space environment Diversified Diversified business position by li
Slide 4: Executive summary: Additional Tier 1 Notes
Financial results for Q1 2013 Executive summary: Additional Tier 1 Notes Nature of EUR RegS benchmark transaction transaction Structure Perpetual, non-call [7] with temporary write-down conditions Trigger The notes will carry 7 % transitional CET1 trigger at both the Bank and Group level Distance to
Slide 5: Agenda
Financial results for Q1 2013 Agenda Executive summary 3 Overview 6 Financial results 9 Capital, liquidity & funding 14 New issue 19 Q&A 27 5
Slide 6: Overview: Danske Bank has a strong Nordic franchise
Financial results for Q1 2013 Overview: Danske Bank has a strong Nordic franchise Facts Danske Bank market share** 3.7 million customers 329 branches* 15 countries 18,478 full-time employees Finland Business units Sweden 10% Personal Banking 5% Business Banking Norway Estonia Corporates & Institutio
Slide 7: Nordic footprint across sectors
Financial results for Q1 2013 Nordic footprint across sectors Lending in Personal and Business Banking, Q4 2014 (%) Credit exposure by industry, Q4 2014 (%) Personal customers 37 Denmark 57 Commercial property 12 Other 9 Finland 9 Non-profit & Associations 6 Investment funds 5 Public institutions 4
Slide 8: Agenda
Financial results for Q1 2013 Agenda Executive summary 3 Overview 6 Financial results 9 Capital, liquidity & funding 14 New issue 19 Q&A 27 8
Slide 9: Net profit: DKK 12.9 bn, up 82% from 2013
Financial results for Q1 2013 Net profit: DKK 12.9 bn,* up 82% from 2013 Income statement & key figures (DKK m) Key points, 2014 vs 2013 • Return on equity improved from 2014 2013 Index Q4 2014 Q3 2014 Index 5.0% to 8.5% before goodwill Net interest income 23,107 22,077 105 5,880 5,976 98 impairment
Slide 10: Expenses: Reduced by 5% in 2014 as a result of continued cost-efficiency measures
Financial results for Q1 2013 Expenses: Reduced by 5% in 2014 as a result of continued cost-efficiency measures Total Group expenses ex goodwill charge (DKK m) Change in expenses ex goodwill (DKK m) Consultants etc. Bonuses Severance payments Write-down on Sampo name 2013 23,794 Deposit scheme guara
Slide 11: Impairments: Loan loss ratio for 2014 of 15 bp for core activities and 20 bp for the Group
Financial results for Q1 2013 Impairments: Loan loss ratio for 2014 of 15 bp for core activities and 20 bp for the entire Group Group impairments, 2008 to 2014 (DKK bn/bp) Impairments (DKK m) Impairments Loan loss ratio* (rhs) 2014 2013 Index Q414 Q314 Index Personal Banking 1,412 1,887 75 517 342 1
Slide 12: Bridge to above 12.5% ROE in 2018
Financial results for Q1 2013 Bridge to above 12.5% ROE in 2018 with unchanged macro, CET1 ratio of around 14% and capital management actions Change in ROE (%, after tax) Comments (Q4 presentation for assumptions) ROE target of above 12.5% in 2018 at the latest • Interest rates as per end 2014 ROE 2
Slide 13: Agenda
Financial results for Q1 2013 Agenda Executive summary 3 Overview 6 Financial results 9 Capital, liquidity & funding 14 New issue 19 Q&A 27 13
Slide 14: Funding and liquidity: Successful capital issues and high issuance activity in 2014
Financial results for Q1 2013 Funding and liquidity: Successful capital issues and high issuance activity in 2014 Changes in funding , 2014 (DKK bn and bp*) Long-term funding ex RD (DKK bn) Cov.bonds Senior Tier 2 Tier 1 Funding plan Completed 108bp 39bp 132bp 586bp 95 51bp 19bp 73 64 50-70 31 62bp
Slide 15: Capital: Solid capital base, with CET1 ratio of 15.1%
Financial results for Q1 2013 Capital: Solid capital base, with CET1 ratio of 15.1% Capital ratios, under Basel III/CRR (%) Capital drivers Tier 2 • In Q4 2014, total REA declined DKK Hybrid tier 1 / Additional tier 1 2 bn to DKK 866 bn, mainly because Common equity tier 1 of developments in the por
Slide 16: Capital: Strong build-up since 2009
Financial results for Q1 2013 Capital: Strong build-up since 2009 Capital base, 2009-2014 (DKK bn) Key points CET1 capital • Strong capital build-up since 2009 AT1 capital with a CET1 ratio of 15.1% and Tier 2 capital total capital ratio of 19.3 at end- 167 2014 155 23 • State hybrid capital of DKK
Slide 17: Financial targets: Target for ROE of above 12.5% in 2018
Financial results for Q1 2013 Financial targets: Target for ROE of above 12.5% in 2018 Status at Target Comments 2015 ambition 31 December 2014 Return on equity Above 12.5%* 8.5% before goodwill Initiatives progressing 9.5% impairments as planned Ratings A ratings S&P/Moody’s/Fitch In progress, upgr
Slide 18: Agenda
Financial results for Q1 2013 Agenda Executive summary 3 Overview 6 Financial results 9 Capital, liquidity & funding 14 New issue 19 Q&A 27 18
Slide 19: New issue: Transaction Rationale
Financial results for Q1 2013 New issue: Transaction Rationale Capital Optimisation under CRD IV - Strong CET1 position to be supplemented with Additional Tier 1 capital - Adjustment of our capital structure in line with capital targets - Continued normalisation of capital structure to be efficient
Slide 20: Comparison with other Additional Tier 1 precedents
Financial results for Q1 2013 Comparison with other Additional Tier 1 precedents Peer 1 Peer 2 Peer 3 Peer 4 Trigger Metric* Transitional CET1 Transitional CET1 Transitional CET1 Transitional CET1 Fully loaded CET1 Principal Loss Temporary Write-down Temporary Write-down Temporary Write-down Tempora
Slide 21: Mandatory distribution restrictions
Financial results for Q1 2013 Mandatory distribution restrictions Key points • Mandatory restrictions to discretionary distributions* will apply to all European banks under CRD IV. The Maximum Distributable Amount (“MDA”) is calculated in relation to the combined capital buffer requirement (“CBR”).
Slide 22: Mitigating mandatory distribution restrictions
Financial results for Q1 2013 Mitigating mandatory distribution restrictions Estimated capital buffer structure, (%) Key points Countercyclical capital buffer CET1 (End 2014) 15.1% • Significant headroom to the MDA (0.2% from 2015) CET1 capital target min.13% restriction point is anticipated, Capita
Slide 23: New issue: Terms and Conditions 1/3
Financial results for Q1 2013 New issue: Terms and Conditions 1/3 Issuer Danske Bank A/S Issuer’s Senior Ratings (M/S/F) A3 (Stable) / A (Negative) / A (Stable) Instrument Ratings (S/F) [BB+] / [BB+] (expected) Description EUR [ ] Perpetual Non-cumulative Resettable Additional Tier 1 Capital Notes (
Slide 24: New issue: Terms and Conditions 2/3
Financial results for Q1 2013 New issue: Terms and Conditions 2/3 Status/Subordination Notes are eligible to constitute Additional Tier 1 Capital under CRD IV. Subject to any Loss Absorption Following a Trigger Event and Reinstatement of the Notes as detailed below, the Notes will constitute direct,
Slide 25: New issue: Terms and Conditions 3/3
Financial results for Q1 2013 New issue: Terms and Conditions 3/3 Loss Absorption If at any time the Common Equity Tier 1 (“CET1”) Capital Ratio of the Issuer and/or the Group following a Trigger has fallen below 7%, the Outstanding Principal Amounts shall be reduced (in whole or in part) Event and
Slide 26: Agenda
Financial results for Q1 2013 Agenda Executive summary 3 Overview 6 Financial results 9 Capital, liquidity & funding 14 New issue 19 Q&A 27 26
Slide 27: Q&A session
Financial results for Q1 2013 Q&A session www.danskebank.com/ir 27
Slide 28: Contacts
Financial results for Q1 2013 Contacts Henrik Ramlau-Hansen Claus Ingar Jensen Chief Financial Officer, Member of the Executive Board Head of IR Direct: +45 45 14 06 66 Direct: +45 45 12 84 83 Mobile: +45 22 20 73 10 Mobile: +45 25 42 43 70 E-mail: hram@danskebank.com E-mail: clauj@danskebank.dk Chr
Slide 29: Disclaimer
Financial results for Q1 2013 Disclaimer Important Notice This presentation does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation of an offer to buy or acquire securities of Danske Bank A/S in any jurisdiction, including the United States,
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