Sparebank 1 Ostlandet · OSL:SPOL
Sparebank 1 Ostlandet — Sparebanken Hedmark — Investor Presentation (September 2016)
18 slides from Sparebank 1 Ostlandet's investor presentation, Sep 22, 2016
Slide 1: Sparebanken Hedmark
Sparebanken Hedmark CEO Richard Heiberg, SB1 London Reception, 22 September 2016
Slide 2: Executive summary
Executive summary • Norway’s 4th largest savings bank, following the Bank 1- acquisition. • Still Norway’s best capitalised regional savings bank. • No oil exposure, high retail share. • Low loan losses, falling share of problem loans. • Aim for merger within H1-17, integration process well underway
Slide 3: Our location
Our location OPPLAND LILLEHAMMER HEDMARK GIOVIK ~ a Sparebanken oe parebanken 1)
Slide 4: The region
The region The Inland: Hedmark and Oppland • Around 8 % of Norway’s population and 6 % of GDP. • Diverse business sector dominated by SMEs. • Most cyclically stable region, no exposure to oil, shipping or fishing. • Norway’s largest region for agriculture and forestry. The capital region: Oslo and A
Slide 5: «Old» Sparebanken Hedmark in brief
«Old» Sparebanken Hedmark in brief From 22 small, local savings banks to one regional savings bank: • Established in 1845. • Operations in Hedmark, Oppland and Akershus (Nes). Norway’s sixth largest savings bank: • Total adjusted assets of NOK 78 bn (Q2-16). • 190.000 customers and a market share in
Slide 6: Bank 1 Oslo Akershus in brief
Bank 1 Oslo Akershus in brief Bank of the labour unions, Totalisternes Aktiebank: • Established in 1898. • Operations in Oslo and Akershus The SB1 Alliance’s bank in the capital region: • Total adjusted assets of NOK 60 bn, of which NOK 52 bn in loans (Q2-16) • 80.000 customers, market share in reta
Slide 7: Why acquire Bank 1?
Why acquire Bank 1? • Strategic positioning towards the largest region in Norway • Integrated region for labour and housing • A better and more competent bank • More diversified loan portfolio • Reduced costs through synergies • Improve the efforts of the SB1 alliance in the capital region 7
Slide 8: «New» Hedmark, unchanged values
«New» Hedmark, unchanged values Norway’s fourth largest savings bank, merger by H1-17 on-track: • Operations in Hedmark, Oppland Oslo and Akershus. • Total adjusted assets of NOK 137 bn, with around NOK 115 bn in loans. • Appr 270.000 customers, 40 branch offices and 1150 employees. • Owned by the f
Slide 9: Still the best capitalised regional savings bank
Still the best capitalised regional savings bank • Superior solidity remains key to our DNA. • Never recorded an operating loss since the end of WW II. • The only regional bank that did not need support during the major bank crisis in Norway in the early 1990s. • Long-term CET-1 target of 16 % - alr
Slide 10: CET-1 targets and actual
CET-1 targets and actual 16,0 15,5 15,0 14,5 14,0 13,5 13,0 12,5 12,0 Peer Peer Peer Peer Peer DNB New Hedmark Target Actual adjusted, Q2-16* * For peers and DNB, Q2-16 includes 75 % of the half-year result while Hedmark’s figure includes 80 % of the half-year result 10
Slide 11: With an uncomplicated and stable loan portfolio
With an uncomplicated and stable loan portfolio • Prudent lending, the church tower principle holds. • Long history of low and stable loan losses. • High share of retail lending, around 75 % • 80 % including agriculture, 2nd largest corporate exposure. • Less than 0.1 % exposure to the oil sector. •
Slide 12: Problem loans compare well with other banks
Problem loans compare well with other banks Total defaulted and doubtful commitments, per cent of gross loans per Q2-16. Source: SpareBank1 Gruppen 12
Slide 13: Acquisition well received by Moody’s
Acquisition well received by Moody’s 13
Slide 14: Best rated, but not the highest rating
Best rated, but not the highest rating SH SNN SMN SR SØR VEST MØR S&F ØST HEL DNB Macro Adj. Score (total) a1 a2 a2 a3 a3 a3 a2 a3 a3 a2 a3 Notches adj. from Macro to -2,8 -1,2 -1,7 -1,5 -1,6 -1,4 -1,6 -1,5 -1,2 -2,1 -0,9 Assigned scores -14 -5 -8 -7 -7 -6 -7 -6 -5 -9 -4 Financial Profile baa1 a3 ba
Slide 15: Financial targets and ownership composition
Financial targets and ownership composition • Financial targets: • ROE after tax: 10 % • CET-1: 16 % • Dividend share: 50 % • Ownership overview per 30 June 2016: • Sparebanken Hedmark Sparebankstiftelse (75 %) • LO (The Norwegian Confederation of Trade Unions, 15 %) • Other SB1-banks (10 %) 15
Slide 16: Steps towards the IPO
Steps towards the IPO Step 1 Step 2 Step 3 Step 4 Decision to Evaluation, Equity issue to IPO evaluate decision to B1OA-owners convert, implementation Foundation Foundation Foundation B1OA-owners B1OA-owners Free float
Slide 17: Funding strategy
Funding strategy • Covered bond financing through SB1 Boligkreditt will remain the largest non-deposit funding vehicle. • Outstanding around NOK 35 bn. • NOK-senior market will remain key source of financing. • Outstanding around NOK 22 bn. • Access European market through the EMTN- programme, prima
Slide 18: Disclaimer
Disclaimer This presentation contains forward-looking statements that reflect management’s current views with respect to certain future events and potential financial performance. Although Sparebanken Hedmark believes that the expectations reflected in such forward-looking statements are reasonable,
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