Swedbank Ab Class A · OMXSTO:SWED_A
Swedbank Ab Class A — Q4 2015 Earnings Presentation
20 slides from Swedbank Ab Class A's earnings presentation, January 2016
Slide 1: Swedbank Year-end report 2015
Swedbank Year-end report 2015 Michael Wolf (CEO), Göran Bronner (CFO), Anders Karlsson (CRO) © Swedbank
Slide 2: Swedish Banking: Strong income in negative interest rate environment
Swedish Banking Strong income in negative interest rate environment SEKm Q4 15 Q3 15 ▲ QoQ • Higher mortgage margins Net interest income 3 560 3 404 156 Net commission income 1 762 1 717 45 • Mortgage loan volume growth Other income 113 100 13 Total income 5 781 5 573 208 • Deposit volume growth Tot
Slide 3: Baltic Banking: Solid performance
Baltic Banking Solid performance SEKm Q4 15 Q3 15 ▲ QoQ • Flat loan volumes in local currencies Net interest income 962 900 62 Net commission income 548 511 37 • Mixed margin development Other income 30 26 4 Total income 1 687 1 566 121 • Lower deposit guarantee fee in Total expenses 654 605 49 Lith
Slide 4: Large Corporates & Institutions: Volatile market
Large Corporates & Institutions Volatile market SEKm Q4 15 Q3 15 ▲ QoQ • Higher activity in FX and equity Net interest income 839 865 -26 trading Net commission income 529 509 20 Net gains and losses 413 315 98 • Low corporate finance activity Other income 36 33 3 Total income 1 817 1 722 95 Total e
Slide 5: Group results: Stable result
Group results Stable result SEKm Q4 15 Q3 15 ▲QoQ • Stable NII despite lower market rates Net interest income 5 759 5 811 -52 Net commission income − Mortgage and deposit volume growth 2 877 2 736 141 Net gains and losses 165 4 161 − Mixed margins Other income 656 683 -27 Total income 9 457 9 234 22
Slide 6: Capital: Reduced REA
Capital Reduced REA Risk exposure amount • Lower corporate credit exposures SEKbn 410 404.2 405 • Increased collateral values 400 -5.3 395 390 -3.1 -3.8 389.1 • Decreased interest rate positions -2.9 385 380 • Positive FX effects 375 370 365 360 Q3 2015 Exposure LGD changes Market risk Other risk Q4
Slide 7: Strong capitalisation – no excess capital
Capital Strong capitalisation – no excess capital CET1 capital ratio, % • CET1 capital ratio improved 24.1% 23.0% − CET1 capital increase 22.4% 20.5% 19.9% − REA decrease • Continued regulatory uncertainty Q1 2015 Q2 2015 Q3 2015 Q4 2015 CET1 capital ratio requirement* * Swedbank’s estimate based on
Slide 8: Liquidity and funding: Increased long-term funding activity
Liquidity and funding Increased long-term funding activity 80 Quarterly long-term funding issuance • FY 2015 issuance of SEK 229bn 70 60 • NSFR at 107 per cent 50 SEKbn 40 Other • LCR at 159 per cent Senior unsecured debt 30 Covered bonds 20 10 0 Average Q115 Q215 Q315 Q415 2014 108 Net Stable Fundi
Slide 9: Asset quality: Solid asset quality
Asset quality Solid asset quality Credit impairments, SEKm Q4 15 Q3 15 ▲QoQ • FY 2015 credit impairments ratio of Swedish Banking 347 35 312 4bps (FY2014, 3bps) Baltic Banking -112 -2 -110 Large Corporates & 164 97 67 Institutions Swedbank Group 399 130 269 Ratios Q4 15 Q3 15 Credit impairment ratio
Slide 10: Asset quality: Oil sector under stress
Asset quality Oil sector under stress • Loan portfolio negatively impacted 10 Shipping & Offshore, loans, SEK 29.8bn by lower oil price, SEK 18.3bn 9 2014-12-31 2015-12-31 60% of the portfolio is negatively 8 impacted by lower oil 7 • Derivative exposures of SEK 2.7bn 6 price 5 • Negative rating mig
Slide 11: Q&A
Q&A Michael Wolf (CEO), Göran Bronner (CFO), Anders Karlsson (CRO)
Slide 12: Appendix
Appendix Swedbank @ 12
Slide 13: Group results – FY2015: Mixed income performance – strong capitalisation
Group results – FY2015 Mixed income performance – strong capitalisation SEKm FY 2015 FY 2014 ▲YoY • Strong NII in negative interest rate Net interest income 22 993 22 642 351 environment Net commission income 11 199 11 204 -5 Net gains and losses 571 1 986 -1 415 • Stable commission income Other inc
Slide 14: 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 15: 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 16: 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 • Strong dedication from executive management on cost and change management − Integrated in corporate culture − Focus on straight-through-processing − Evolving ho
Slide 17: Conservative funding position
Liquidity and funding Conservative funding position • LCR 159% (Swedish FSA definition FFFS 2012:6) • NSFR 107% (Basel committee) • Issued SEK 229bn of term funding FY 2015 • Plan to issue around SEK 180bn in 2016 Term funding issuance – completed and planned Prefunded for more than 12 months SEKbn
Slide 18: Long-term funding maturity profile
Liquidity and funding Long-term funding maturity profile Benchmark transactions FY 2015 ● USD 750m, Perp. NC5 (2020), AT1, 5.50% - equity conversion ● USD 1bn, RegS. CB 5Y (2020), Fixed, 3m $L + 37bp ● USD 1bn 144a Senior, 5Y (2020), T+77bp (+ USD 400m 3Y (2018) T+65bp) ● EUR 750m Senior 7Y (2022),
Slide 19: 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/14 9% 14% 11% Aug/14 9% 14% 11% Sep/14 9% 15% 11% Oct/14 8% 15% 11% Nov/14 13% 15% 14% Dec/14 15% 15% 15% House price index, Sweden3 220 2005
Slide 20: Baltic real estate prices
1 000 1 200 1 400 1 600 1 800 0 200 400 600 800 1 000 1 200 1 400 1 600 1 800 0 200 400 600 800 Jun-05 Dec-05 Dec-05 Jun-06 Jun-06 Dec-06 EUR/m2 /No. of deals EUR/m2 /No. of deals Dec-06 Jun-07 Jun-07 Dec-07 Dec-07 Jun-08 Source: Swedbank, 31 Dec 2015 Jun-08 Dec-08 Dec-08 Jun-09 Real estate prices J