Slide 1: Financial results for the year ended 30 June 2022
Financial results for the year ended 30 June 2022 8 August 2022 SUNCORP GROUP LIMITED ABN 66 145 290 124
Slide 2: FY22 Overview
Suncorp FY22 Results FY22 Overview Steve Johnston Chief Executive Officer 2
Slide 3: Purpose driven, delivering sustainable outcomes
Suncorp FY22 Results Purpose driven, delivering sustainable outcomes Our Purpose Building futures and protecting what matters + People Capable, engaged, diverse, innovative = Customers & Community Delivering valued outcomes = Financial Outcomes A sustainable business 3
Slide 4: Summary Profit & Loss Statement
Suncorp FY22 Results Summary Profit & Loss Statement FY22 FY21 Change - FY22 results demonstrate strong ($m) ($m) ($m) growth and progress in underlying Insurance (Australia) 174 547 (373) margins Banking 368 419 (51) - Elevated natural hazards event season with assistance provided to around New Zea
Slide 5: FY22 key highlights
Suncorp FY22 Results FY22 key highlights Insurance (Australia) GWP growth of 9.2%* Group UITR 9% (10.7% in H2 v pcp) FY23 target of 10-12% reaffirmed NZ GWP growth of 14.1% Claims management improvements effectively (14.2% in H2 v pcp) controlling inflationary pressures Banking home lending growth o
Slide 6: Sale of Suncorp Bank - Strategic rationale
Suncorp FY22 Results Sale of Suncorp Bank - Strategic rationale Simplify Focus Maximise Position Alignment Suncorp as an on strategic value for Suncorp Suncorp Bank’s of ambition with organisation with a initiatives within shareholders with customers, people ANZ on the Bank’s commitment to Suncorp’s
Slide 7: FY22 Financial Results
Suncorp FY22 Results FY22 Financial Results Jeremy Robson Chief Financial Officer 7
Slide 8: Financial overview
Suncorp FY22 Results Financial overview Strong growth momentum and improving underlying performance – Record 2H GWP growth in Australia and New Zealand and turnaround in Home Lending – Underlying ITR expansion to 9% for FY22 and 9.9% in 2H (excluding COVID benefits) – FY23 targets reaffirmed with na
Slide 9: Insurance (Australia) – Gross written premium
Suncorp FY22 Results Insurance (Australia) – Gross written premium Gross written premium (excluding ESL) by portfolio ($m) Home and motor portfolio (normalised)1 5.4% 4.9% 4.9% 105 (146) 9,254 66 115 +19.9% +6.4% 2.9% 214 +7.5% 2.6% 2.1% 4.5% +9.6% 273 3.1% 2.9% 8,627 2.2% 1.2% 0.5% +8.7% Dec-19 Jun
Slide 10: Insurance (Australia) – Net loss ratio
Suncorp FY22 Results Insurance (Australia) – Net loss ratio Net loss ratio (%)1 Working claims excl. COVID 0.0% 0.8% -0.6% 74.8% -0.5% -0.5% 0.7% -0.2% -1.1% 73.4% Prior year reserve releases FY22 (% of Group NEP) 2.2% 1.7% 0.5% Total Australia TEPL Total Australia (excl. TEPL) FY21 Consumer Commerc
Slide 11: Insurance (Australia) – Investment market impacts
Suncorp FY22 Results Insurance (Australia) – Investment market impacts Underlying yield on insurance funds (%; annualised) Investment Portfolio 1.75% 1.59% 6% 6% Risk free yield 0.69% 14% 46% AAA Cash Credit spread yield 1.04% 0.66% Fixed Income Manager alpha 0.49% 0.23% Inflation-linked $13.7b 15%
Slide 12: New Zealand (NZ$)
Suncorp FY22 Results New Zealand (NZ$) New Zealand PAT ($m) - Strong top line performance continued with seventh consecutive quarter of above system growth -23.3% 215 Life 38 - Lower investment returns impacted profit but will result in higher yields 165 15 in future periods General - Elevated natur
Slide 13: Natural hazards and reinsurance
Suncorp FY22 Results Natural hazards and reinsurance Natural hazard experience vs allowance ($m) AXL cover FY22 v FY23 ($m) +101 150 50% 400 1,160 Placed 400 Deductible 1,081 980 Coverage 850 650 Top-up Over $5m 825 FY22 FY23 Attritional 256 FY23 Main Cat and Dropdown Cover ($m) 6,800 Main Cat FY22
Slide 14: Group underlying ITR
Suncorp FY22 Results Group underlying ITR Group UITR FY21 to FY22 9.9% 0.9% (COVID) 0.5% -0.2% 7.9% 0.2% 0.7% (COVID) 1.3% UITR on track with FY23 target 9.0% 7.2% (ex-COVID) 10-12% (ex-COVID) 9.0% FY22 Natural Hazards Reinsurance Investment Pricing / FY23 Income Expenses FY21 Consumer Commercial Pe
Slide 15: Banking
Suncorp FY22 Results Banking FY22 FY21 Change ($m) ($m) (%) Net interest margin walk (%) Net interest income 1,245 1,242 0.2 (0.17) (0.07) 0.20 Other operating income 3 39 (92.3) (0.10) Operating expenses (736) (731) 0.7 1.94 2.07 1.93 Profit before impairments 512 550 (6.9) Impairment release/(expe
Slide 16: Banking – Credit Quality
Suncorp FY22 Results Banking – Credit Quality Collective provision ($m) Origination LVR (%) 90-day+ past due (% of total GLA) Agribusiness SME Commercial Home loans 1.02% 0.08% 0.96% 0.93% 255 73% 73% 0.04% 0.06% 195 0.06% 0.04% 111 180 69% 0.05% 0.04% 0.04% FY19 FY20 FY21 FY22 FY20 FY21 FY22 0.53%
Slide 17: Group operating expenses
Suncorp FY22 Results Group operating expenses Group operating expenses (excluding ESL) FY21 to FY22 ($m) - Increase in strategic spend in line with Restructuring previous guidance and expected to 57 Wealth costs (exited) reduce in FY23 Group operating expenses 34 2 - Growth related costs driven by h
Slide 18: Group CET1 Capital
Suncorp FY22 Results Group CET1 Capital - The net capital usage was $470m during Common Equity Tier 1 Capital held at Group ($m) 2H22, with the majority of the Deferred Tax Asset (DTA) and GI capital usage expected Net capital usage $470m to unwind over time as: - Investments reach maturity – averag
Slide 19: Strategic Outlook
Suncorp FY22 Results Strategic Outlook Steve Johnston Chief Executive Officer 19
Slide 20: Strategy
Suncorp FY22 Results Strategy Purpose Building futures and protecting what matters Customer led Technology enabled Our people Advocacy Strategic Digital first and Automated processes Exceptional people Building towards a fair pillars personalised customer and modernised empowered to make a and susta
Slide 21: Insurance Australia - strategic progress and outlook
Suncorp FY22 Results Insurance Australia - strategic progress and outlook - Achieved strong gross written premium growth across all our portfolios, with AAMI generating unit growth in home and motor and higher NPS scores than FY21 Revitalise growth - Delivered growth in Commercial supported by simpl
Slide 22: New Zealand - strategic progress and outlook
Suncorp FY22 Results Suncorp New Zealand - strategic progress and outlook - Continued momentum with a targeted focus on deepening broker relationships and offering compelling market Grow brands and propositions delivered through trusted brands. strategic partnerships - Increased market share by 134
Slide 23: Natural Hazards, Resilience & Mitigation
Suncorp FY22 Results Natural Hazards, Resilience & Mitigation Declared Events Total Event Claims Finalisation Online Lodgement 35 128,785 57% 58% Australia: 29 New Zealand: 6 Motor: 29,295 | Home: 85,507 Motor: 71% | Home: 52% (Australia) ↑ 12 Events on PCP Commercial: 4,441 | NZ: 9,542 Commercial:
Slide 24: FY23 targets reaffirmed
Suncorp FY22 Results FY23 targets reaffirmed Returns Cash return on equity above the through-the-cycle cost of equity Dividend payout ratio of 60% to 80% of cash earnings Dividends Return any capital to shareholders that is excess to the needs of the business Key divisional metrics General Insurance
Slide 25: Suncorp FY22 Results
Suncorp FY22 Results SUNCORP Building futures and protecting what matters SUNCORP (_) 25
Slide 26: Important Disclaimer
Suncorp FY22 Results Important Disclaimer This presentation contains general information which is current as at 8 August 2022. It is information given in summary form and does not purport to be complete. It is not a recommendation or advice in relation to the Group or any product or service offered