Swedbank Ab Class A · OMXSTO:SWED_A
Swedbank Ab Class A — Q2 2006 Earnings Presentation
24 slides from Swedbank Ab Class A's earnings presentation, 2006
Slide 1: Swedbank Q2 2006
Swedbank Q2 2006
Slide 2: Strategic Developments
2 Strategic Developments Jan Lidén, President and CEO
Slide 3: Q2 business highlights
3 Q2 business highlights • Swedish Banking - Continued high business activity and less margin pressure – Steady growth in corporate and household lending – Stabilizing mortgage margins – Improving deposit margins • Baltic Banking - Continued rapid growth with stable margins – Stable growth in lendin
Slide 4: Volume Growth
4 Volume Growth SEK bn June 30 Dec 31 June 30 Change, Change, Lending 2006 2005 2005 YTD, % Y/Y, % Swedbank Group 852 796 753 7 13 Of which Spintab household lending 357 340 322 5 11 Corporate lending * 353 331 322 7 10 Baltic Banking 109 89 69 24 ** 60 ** Savings Swedbank Group 763 729 681 5 12 Of
Slide 5: Margins of loans and deposits
5 Margins of loans and deposits Lending Deposits 4.0% 2.5% 3.5% 2.0% 3.0% 2.5% 1.5% 2.0% 1.5% 1.0% 1.0% 0.5% 0.5% 0.0% 0.0% Q2-05 Q3-05 Q4-05 Q1-06 Q2-06 Q2 05 Q3-05 Q4-05 Q1-06 Q2-06 Estonia Latvia Lithuania Sweden Estonia Latvia Lithuania Sweden
Slide 6: Swedish Banking
6 Swedish Banking SEK M 5,000 * ** 4,500 4,000 3,500 3,000 C/I 0.51 2,500 2,000 1,500 1,000 500 0 Q3-04 Q4-04 Q1-05 Q2-05 Q3-05 Q4-05 Q1-06 Q2-06 Income Expenses *Excluding EnterCard SEK 810 M **Excluding KIAB SEK 1,421 M
Slide 7: Swedish Banking Net interest income
7 Swedish Banking Net interest income SEK M 3,400 3,200 3,000 4% 2,800 2,600 2,400 2,200 2,000 Q2-04 Q3-04 Q4-04 Q1-05 Q2-05 Q3-05 Q4-05 Q1-06 Q2-06
Slide 8: Baltic Banking
8 Baltic Banking SEK M 1,800 1,600 1,400 1,200 C/I 0.46* 1,000 800 600 400 200 0 Q3-04 Q4-04 Q1-05 Q2-05 Q3-05 Q4-05 Q1-06 Q2-06 Income Expenses * Excluding provision for Russian VAT SEK 114 M in Q2 2006
Slide 9: Swedbank Markets
9 Swedbank Markets SEK M 600 Change in profit for the period attributable to the shareholders: 500 Q1-Q2 51% 400 Y05-Y06 73% 300 200 100 0 Q3-04 Q4-04 Q1-05 Q2-05 Q3-05 Q4-05 Q1-06 Q2-06 Operating profit Profit for the period attributable to the shareholders
Slide 10: Income increasingly diversified
10 Income increasingly diversified Income by Strategic Business Area* Income by category Net gains and 100% 100% Asset losses on Management financial 90% items at fair Swedbank value 80% 80% Markets Net 70% commissions Baltic Banking 60% 60% 50% 40% 40% 30% Swedish Net interest Banking income 20% 20
Slide 11: Group profit trend
11 Group profit trend SEK M 3,000 *** 2,500 ** * 2,000 1,500 1,000 500 0 Q1-04 Q2-04 Q3-04 Q4-04 Q1-05 Q2-05 Q3-05 Q4-05 Q1-06 Q2-06 Profit for the period attributable to shareholders, excluding larger capital gains: * Excluding FIH SEK 1,200 M ** Excluding EnterCard SEK 810 M *** Excluding KIAB SEK
Slide 12: Group financial targets
12 Group financial targets 0.80 C/I Ratio 0.70 Group Financial Objectives 0.60 • Return on equity 0.50 0.40 • Cost / Income ratio 0.30 • Primary capital ratio 0.20 0.10 0.00 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 -01 -01 -02 -02 -02 -02 -03 -03 -03 -03 -04 -04 -04 -04 -05 -05 -0
Slide 13: Group Financial Overview
13 Group Financial Overview Mikael Inglander, CFO and Head of Group Staffs
Slide 14: Result highlights
14 Result highlights SEK M Q2 2006 Q1 2006 Change, % Net interest income 3,783 3,777 0 Net commissions 2,353 2,098 12 Net gains and losses on financial items at fair value 1,032 260 Total income 7,578 6,543 16 Expenses – 3,902 – 3,650 7* Loan losses 116 – 50 Operating profit 3,792 2,843 33 Profit fo
Slide 15: Change in net interest income
15 Change in net interest income Q2 compared with Q1 SEK M Swedish Baltic Other Group Banking Banking Lending volumes 142 152 2 296 Deposit volumes 18 8 3 29 Lending margins – 57 – 70 –5 –132 Deposit margins 55 7 0 62 Other – 60 0 – 188 –248 Total 98 97 – 188 7 of which SEK – 181 M is change in elim
Slide 16: Change in Eliminations
16 Change in Eliminations SEK M SEK – 181 M change in 250 elimination Q2 /Q1 200 150 100 41 50 0 0 -2 0 Q2-05 Q3-05 Q4-05 Q1-06 Q2-06 -50 -27 -100 -150 -200 -250 Net interest income Net gains and losses on financial items at fair value Net effect
Slide 17: Net commissions
17 Net commissions Change Change SEK M Q2 2006 Q1 2006 QoQ % Q2 2005 YoY % Payment 639 602 6 677 –6 Lending 189 129 47 83 Brokerage 294 301 –2 133 Asset management 937 914 3 748 25 Insurance 122 118 3 102 20 Other 172 34 91 Total 2,353 2,098 12 1,834 28 Primarily corporate advisory fees in First Sec
Slide 18: Net gains and losses on financial items at fair value
Net gains and losses on financial items 18 at fair value SEK M 1,200 1,000 Strategic shareholding 800 Elimination Other 600 400 Baltic Banking 200 Swedbank Markets 0 -200 Q1 -05 Q2 -05 Q3-05 Q4-05 Q1-06 Q2-06
Slide 19: Value of strategic shareholdings
19 Value of strategic shareholdings Second quarter including: M SEK 400 Primary Capital Certificates 350 (Grunnfondbevis) 300 250 • SpareBank1 Midt-Norge SEK - 27.7 M 200 • SpareBank 1 SR-bank SEK - 71.0 M 150 • SpareBank 1 Nord-Norge SEK - 6.8 M 100 50 Q1 06 SpareBank 1 Gruppen 0 Q2 05 Q3 05 Q4 05
Slide 20: Expenses
20 Expenses SEK M 4 000 SEK 167 M 3 950 5 % QoQ 1 3,902 3 900 3 850 84 3 800 68 3 750 3 700 120 3,650 3 650 -21 3 600 3 550 3 500 Q1 total Decreased Increased profit Increased other Increased Increased Q2 total expenses staff cost based staff general and Russian VAT depreciation expenses costs admin
Slide 21: Loan losses, Group
21 Loan losses, Group Loan losses, Loan loss level, SEK M Percent 500 0.30 450 0.25 400 350 0.20 300 250 0.15 200 0.10 150 100 0.05 50 0 0.00 -50 Q1- Q2- Q3- Q4- Q1- Q2- Q3- Q4- Q1- Q2- Q3- Q4- Q1- Q2- Q3- Q4- Q1- Q2- 02 02 02 02 03 03 03 03 04 04 04 04 05 05 05 05 06 06 -0.05 -100 -150 -0.10 Loan l
Slide 22: Profit per business area
22 Profit per business area Q2, 2006 Asset Swedish Baltic Swedbank Mgmt. & SEK M Banking Banking Markets Insurance Total income 4,277 1,532 1,113 466 Total expenses – 2,189 – 816 – 558 – 175 Profit before loan losses 2,088 716 555 291 Loan losses 191 – 79 0 Operating profit 2,279 637 555 291 Profit
Slide 23: Q2 Highlights
23 Q2 Highlights • Profit for the period attributable to the shareholders increased by SEK 516 M or 23 percent to SEK 2,786 (2,270) • Earnings per share, SEK increased by 22 percent to 5.40 (4.41) • Return on equity increased to 20.2 percent (16.6) • Cost / income ratio decreased to 0.51 (0.56) • Pr
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