Nordea Bank Abp · OMXHEX:NDA_FI
Nordea Bank Abp — Nordea — FY2000 Earnings Presentation
32 slides from Nordea Bank Abp's earnings presentation, Feb 21, 2001
Slide 1: Successful mergers for growth with increased financial results and shareholder value
Successful mergers for growth with increased financial results and shareholder value Full year and fourth quarter 2000 21 February 2001
Slide 2: Björn Westberg
Björn Westberg
Slide 3: Thorleif Krarup, Group CEO
Thorleif Krarup, Group CEO
Slide 4: The Nordea structure is in place...
The Nordea structure is in place... l Pan-Nordic mergers created the leading financial services group in the Nordic and Baltic Sea region • Sweden and Finland started the process – Integration continues and accelerates • Denmark and Norway joined in 2000 – The merger of Unidanmark and MeritaNordbank
Slide 5: The Nordea structure is in place...
The Nordea structure is in place... l New management installed • Comprehensive merger experience • Continuity in vision • Higher ambitions – By 2003: # 1 or # 2 or superior profitable growth – More aggressive cost/income ratio objective in banking: < 50%
Slide 6: Increased result in 2000
Increased result in 2000 l Operating profit up 17% to EUR 2,435m (SEK 20,600m) l Return on equity 16.1%, excluding goodwill 19.4% l Strong growth in interest and commission income l Cost/income ratio banking 55% - down from 59%
Slide 7: Continued focus on...
Continued focus on... l Synergies EUR 310m under delivery - further EUR 50m estimated l Integration Best practice and bench-marking l Customers Customer satisfaction l Employees Sharing and exploiting Nordic ideas l Branding The Nordea name adopted and well received l Growth opportunities Cross-sell
Slide 8: Successful cross-border product launches since MNB/UD-merger
Successful cross-border product launches since MNB/UD-merger l Internet-bank, Solo-market and e-payment to Denmark l Customer loyalty program introduced in Denmark l General insurance services to Finland l Mobile GSM/SMS and WAP services to Sweden l Internet bank for corporate customers to Sweden l
Slide 9: Synergies under delivery
Synergies under delivery Annual synergies from integration to be realised within a 3-year period, EURm Costs Revenues Total MNB and Unidanmark 140 60 200 Nordea and CBK 50 60 110 Total 190 120 310 A further EUR 50m estimated
Slide 10: Enhanced shareholder value
Enhanced shareholder value l Earnings per share EUR 0.58, up 5% l Proposed dividend SEK 2.00, up 14.3% l Nordea share price up 43 % during 2000 l Nordea the only Nordic group among the top 20 listed European financial institutions by market capitalisation l Share buy back programme to be prolonged l
Slide 11: Arne Liljedahl, Group CFO
Arne Liljedahl, Group CFO
Slide 12: Result 2000
Result 2000 Pro forma Change 2000 1999 % Operating profit, EURm 2 435 2 089 17 Return on equity, % 16.1 18.0 Return on equity excl goodwill, % 19.4 19.5 Cost/income ratio, banking, % 55 59 Combined ratio, general insurance, % 110 (105*) 102 * Excluding hurricane
Slide 13: Result 2000
Result 2000 Pro forma Change 2000 1999 % Earnings per share, EUR 0.58 0.55 5 Proposed dividend, SEK 2.00 14.3
Slide 14: Net interest income
Net interest income EURm 900 • Stable performance - 800 up 12% 700 • Rising short-term interest 600 rates - higher deposit margins 500 400 • Lending volumes up 3% 300 200 100 0 Q4/99 Q1/00 Q2/00 Q3/00 Q4/00
Slide 15: Net commission income
Net commission income EURm 500 • Commissions up 26% 400 • Strong beginning of the year due to stock markets 300 • Regained fourth quarter from seasonal downturn 200 in third quarter • Corporate finance fees 100 higher Q4 than Q3 0 Q4/99 Q1/00 Q2/00 Q3/00 Q4/00
Slide 16: Expenses
Expenses EURm • Total expenses up 10% 1000 • Adjusted for acquisitions, 900 up 3% 800 • Personnel expenses, 700 adjusted, up 5% 600 of which 3 %-points 500 performance related 400 salaries 300 200 • Expansion within 100 Asset Management 0 • Increased activities in the Q4/99 Q1/00 Q2/00 Q3/00 Q4/00 B
Slide 17: Loan losses 2000
Loan losses 2000 Loan losses, gross Recoveries Loan losses, net -600 -400 -200 0 200 400 600 800 EURm Loan loss level 0.08% (0.09%)
Slide 18: Balance sheet
Balance sheet EURbn Total assets EURbn Lending EURbn Deposits 250 250 250 200 200 200 150 150 150 100 100 100 50 50 50 0 0 0 End 1999 End 2000 End 1999 End 2000 End 1999 End 2000 CBK
Slide 19: Capital adequacy
Capital adequacy EURbn Risk-weighted assets % Capital adequacy 150 12 125 10 100 8 75 6 50 4 25 2 0 0 1999 2000 End 1999 End 2000 CBK Tier 1 Total capital ratio
Slide 20: Fourth quarter
Fourth quarter l Total income up 6%, adjusted for investment operations l Improvement in net interest income and commissions l Weak stock market affected investment portfolios negatively l Costs, including performance-related salaries, up 15% l Adjusted for performance-related salaries, personnel co
Slide 21: Profit by business area
Profit by business area EURm 1600 1400 Product result 1200 1000 Operating 800 profit 600 400 200 0 -200 Retail Corpo- Asset Invest- Life In- General Treasury Other rate & Mana- ment surance Insu- Institu- gement Banking1) & rance tional Pensions 1) Product result refers to Equities excluding Corpora
Slide 22: Thorleif Krarup, Group CEO
Thorleif Krarup, Group CEO
Slide 23: The leading financial services group in the Nordic and Baltic Sea area
The leading financial services group in the Nordic and Baltic Sea area Financial and business objectives to create shareholder value Vision to be valued as the leading financial services group in the Nordic and Baltic Sea region Ambition to reach top market positions Mission to fulfil customer aspir
Slide 24: Retail Banking Objectives
Retail Banking Objectives l Cost/income ratio improvement l Increasing return on allocated capital l Uniformed customer segmentation l 2.7m e-customers by the end of 2001 Market position Denmark Finland Norway Sweden #2 #1 #2 #3
Slide 25: Asset Management Objectives
Asset Management l The asset manager in the Nordic area Objectives generating the highest shareholder value l Overall growth of 20% per annum in assets under management l Investment returns ranking in the top quartile l Nordea - First in mind Market position Leading pan-Nordic asset manager Denmark
Slide 26: Corporate and Institutional Banking Objectives
Corporate and Institutional Banking l Growing profits with increasing return on Objectives allocated capital l Top results in customer satisfaction Market position Denmark Finland Norway Sweden #2 #1 #2 #3
Slide 27: Investment Banking Objectives
Investment Banking l Profit growth Objectives l Improvement of cost/income ratio l Maximise fee generating activities l Improvement of customer satisfaction Market position Denmark Finland Norway Sweden Market #2 #1 #5 #8 share, equities
Slide 28: Life Insurance and Pensions Objectives
Life Insurance and Pensions l Premium growth above market development Objectives l Improved cost efficiency l Embedded value growth Market position Denmark Finland Norway Sweden Premium income #3 #1 #4 #8
Slide 29: General Insurance Objectives
General Insurance l Combined ratio of max 100 Objectives l Improved cost efficiency l Improved efficiency of distribution channels Market position Denmark Finland Norway #1 Start in spring 2001 #3
Slide 30: Share price development in 2000
Share price development in 2000 Dec 31, 1999 =100 160 140 120 100 80 60 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb DJ Europe Stoxx Banks Nordea
Slide 31: Top European financial services groups by Market Capitalisation
Top 25 European financial services groups by Market Capitalisation HSBC ING UBS Royal Bank of Scotland Lloyds TSB Credit Suisse Barclays Deutsche Bank BSCH BBVA Fortis BNP Paribas ABN-AMRO HypoVereinsbank Banca Intesa UniCredito Italiano Abbey National Société Générale Sanpaolo Nordea Halifax Dresdn
Slide 32: Nordea in the Nordic and the Baltic Sea region in 2001
Nordea in the Nordic and the Baltic Sea region in 2001 Finland Locations 461 Personnel 11 339 Sweden Helsinki Locations 270 Stockholm Personnel 6 707 Bergen St Petersburg Oslo Tallinn Tartu Norway Copenhagen Gdynia Riga Locations 200 Moscow Personnel 5 500 Hamburg GdanskVilnius Berlin Denmark Luxemb