Nordea Bank Abp · OMXHEX:NDA_FI
Nordea Bank Abp — Q2 2010 Earnings Presentation
29 slides from Nordea Bank Abp's earnings presentation, Jul 21, 2010
Slide 1: Second Quarter Report 2010 Press and analyst conference
Second Quarter Report 2010 Press and analyst conference 21 July 2010 Christian Clausen President and Group CEO
Slide 2: 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 Nordea believes that the expectations reflected in such forward-looking statements are reasonable, no assurance
Slide 3: Key messages
Key messages 9 We deliver according to our plan 9 Continued strong customer business 9 Result from items at fair value decreased from high levels 9 Improved outlook 3 21 July 2010 Second Quarter Report 2010
Slide 4: Continued strong customer business
Continued strong customer business Income in Corporate Income in Household Total income segment segment Q2 2009 Q1 2010 Q2 2010 Q2 2009 Q1 2010 Q2 2010 Q2 2009 Q1 2010 Q2 2010 Number of Gold Lending volumes Impaired loans customers Q2 2009 Q1 2010 Q2 2010 Q2 2009 Q1 2010 Q2 2010 Q2 2009 Q2 2010 Q2 2
Slide 5: Result highlights
Result highlights EURm Q2/10 Q1/10 Chg % Q2/09 Chg % H1/10 H1/09 Chg % Net interest income 1,249 1,235 1 1,305 -4 2,484 2,661 -7 Net fee and commission income 538 475 13 412 31 1,013 793 28 Net result from items at fair value 339 548 -38 594 -43 887 1,109 -20 Other income 35 45 -22 48 -27 80 75 7 To
Slide 6: Net interest income up 1%
Net interest income up 1% Net interest income, EURm Solid trend in customer operations continues 1,305 Lending and deposit volumes up 1,235 1,249 Margins stable Remains subdued by the low interest rate levels Q2 2009 Q1 2010 Q2 2010 6 21 July 2010 Second Quarter Report 2010
Slide 7: Strong funding operations despite a challenging second quarter
Strong funding operations despite a challenging second quarter Total long-term funding issued, EURbn EUR 10.5bn of long-term funding issued In June after several weeks of no 31 market supply Nordea reopened the 23 22 20.9 senior unsecured market Funding costs still compare favourably – new lon
Slide 8: Net fee and commission income up 13%
Net fee and commission income up 13% Net fee and commission, EURm Higher income contribution from 538 corporate finance 475 Continued strong performance in 412 savings area High activity in capital markets Q2 2009 Q1 2010 Q2 2010 8 21 July 2010 Second Quarter Report 2010
Slide 9: Strong demand for risk management products remains
Strong demand for risk management products remains Net result from items at fair value, Capital markets activities in customer EURm 594 areas¹ continues to perform - up 25% 548 515 Market volatility increased corporate 486 demand for fixed income and FX products 351 2 325 339 Continued strong
Slide 10: Expenses in line with outlook
Expenses in line with outlook Total operating expenses, EURm Cost management remains firm Increase in Q2 related to Group 1,164 1,186 1,116 initiatives and currency effects Total expenses up 6% compared to same quarter last year Up 1% adjusted for currency effects Q2 2009 Q1 2010 Q2 2010 10
Slide 11: Credit quality improving
Credit quality improving Net loan losses, EURm Net loan losses down to 35 bps 57bps 34bps individual (26bps) 48 1bps collective (11bps) 377 50bps 114bps in the Baltic countries (166bps) 37bps 35bps 261 Excluding guarantee scheme 58 provisions¹ net loan loss ratio down 187 26bps to 26bps (Q
Slide 12: Impaired loans somewhat decreased in Q2
Impaired loans somewhat decreased in Q2 Impaired loans, EURm Impaired loans gross down 1% 2 076 2 094 EUR 4,407m or 135bps (140bps) 1 585 52% of impaired loans performing 2 377 2 313 1 949 Q2 2009 Q1 2010 Q2 2010 Performing Non-performing Minor increase in collective allowances – Total allow
Slide 13: Strong capital position maintained
Strong capital position maintained Core Tier 1 capital ratio (excl. Hybrids) Core tier 1 ratio 10.0% - minor decrease in Q2 10.3 10.1 10.0 9.2 9.2 9.0 High customer activity offset by solid profit generation Nordea part of CEBS’ EU-wide stress tests to be published 23 Q2/09 Q1/10 Q2/10 July Tr
Slide 14: Outlook 2010
Outlook 2010 Nordea expects macroeconomic recovery to continue in 2010 The global development is still fragile and hence uncertainty remains, the outlook for the Nordic markets has improved during the year Excluding currency effects in 2010, Nordea expects cost growth to be broadly in line wit
Slide 15: Business development
Business development 15 21 July 2010 Second Quarter Report 2010
Slide 16: Macro economic stabilisation in the Nordic region
Macro economic stabilisation in the Nordic region GDP growth y/y, % GDP recovers from sharp decline last 7.5 year 5.0 2.5 In 2010 all Nordic countries are expected 0.0 -2.5 to have: Norway -5.0 Denmark Positive growth rates -7.5 Finland -10.0 Sweden Modest inflation 2007 2008 2009 2010E 2011
Slide 17: Nordea value proposition attracts household customers in premium segments
Customer area Nordea value proposition attracts household customers in premium segments Solid trend accelerated in Q2 – up 2.6% Number of Gold customers, ‘000 2,885 73,000 new Gold and Private Banking 2,812 2,690 customers in Q2 – more than 75% new customers in Nordea Improved market share in
Slide 18: High corporate activity – income up 10%
Customer area High corporate activity – income up 10% Increased business confidence - lending Corporate lending, EURbn volumes up 3% 136 139 144 Continued strong demand for risk management products Improved market share in Corporate Q2 2009 Q1 2010 Q2 2010 Banking - strategy to build house-ban
Slide 19: Nordea's relationship banking approach further strengthened
Customer area Nordea’s relationship banking approach further strengthened Strong income growth in CMB Total income CMB, EURm Strengthened market position – increased 342 372 315 share of wallet New area established¹ – Corporate Merchant Banking and Capital Markets Q2 2009 Q1 2010 Q2 2010 Ens
Slide 20: Institutional & International Banking – solid long-term income growth contribution
Customer area Institutional & International Banking – solid long-term income growth contribution Shipping, Oil Services & International – Nordea SOSI income, EURm 196 CAGR 20% 195 benefits from its strong position 178 183 138 A number of transactions executed – confidence slowly returning to 102
Slide 21: Improved position in capital markets
Product area Improved position in capital markets Nordic syndication market picked up in Q2 May ’10 June ’10 Rights issue Rights issue SEK 5,000 million NOK 4,000 million Joint Global Coordinator, Joint Global Coordinator, Nordea remains the leading arranger of Nordic Joint Bookrunner and Underw
Slide 22: Solid trend of positive net inflow remains
Product area Solid trend of positive net inflow remains Assets under Management (AuM), EURbn Increased AuM despite the Eurozone turmoil 157 158 170 126 Continued net inflows in most areas - EUR 1.9bn Solid trend in Institutional AM 2007 2008 2009 H1 2010 continues – increased appetite for Net
Slide 23: Strong sales trend remains in Life & Pensions
Product area Strong sales trend remains in Life & Pensions Increased demand in the bank channel – Gross Premiums Written, EURm focus on unit-linked 1,399 1,316 GWP up 30% compared to same quarter last year 1,013 Record high Swedish market share of 6.5% Positive momentum for contractual pensi
Slide 24: Prudent growth strategy – growth initiatives on track in all areas
Prudent growth strategy – growth initiatives on track in all areas 24 21 July 2010 Second Quarter Report 2010
Slide 25: Careful navigation of the Prudent growth strategy
Careful navigation of the Prudent growth strategy Increase business with Exploit global Supplement Nordic existing Nordic customers and European growth through Keeping strong business and attract new customers business lines investments in New European Markets momentum 1. Future distribution 6. Gr
Slide 26: Activities related to the initiatives are on track
Activities related to the initiatives are on track Future distribution 14 branches transformed to new branch format Increased number of 360-degree advisory meetings New customer acquisition Growth in number of customers continue to perform strongly – 73,000 new Gold and Private Banking custome
Slide 27: Activities related to the initiatives are on track
Activities related to the initiatives are on track Growth Plan Corporate Merchant Banking (CMB) Sweden According to plan in terms of income development and customer relations Increased share of wallet – cash management mandates won Customer driven Markets business Capital market products to co
Slide 28: Strong foundation for reaching long-term targets
Strong foundation for reaching long-term targets Future distribution Risk-adjusted profit, EURm New customer acquisition 3,914 10% CAGR Growth plan Finland required CMB Sweden 2,786 Customer-driven Markets business 2,239 2,279 1,957 Growth plan Poland Top league IT performance Product platforms Infr
Slide 29: Key messages
Key messages We deliver according to our plan Continued strong customer business Income from corporate customers up 10% and from household customers up 7% Increased lending, deposits and AuM volumes Solid inflow of new customers – increased market shares in all markets Positive developme