Nordea Bank Abp · OMXHEX:NDA_FI
Nordea Bank Abp — Nordea Kredit — Debt Investor Presentation (2021)
25 slides from Nordea Bank Abp's debt investor presentation, 2021
Slide 1: Nordea Kredit Covered Bonds
Nordea Kredit Covered Bonds Q1 2021 Debt Investor Presentation
Slide 2: Table of contents
Table of contents 1. Nordea covered bond issuance in brief 3 2. Nordea Kredit in brief 5 3. Cover pool key characteristics 7 4. Asset quality 11 5. Underwriting criteria 14 6. Covered bond framework 16 7. Macro 18 8. Contacts and links 22 2
Slide 3: 1. Nordea covered bond issuance in brief
1. Nordea covered bond issuance in brief 3
Slide 4: Nordea covered bond operations
Nordea covered bond operations Q1 2021 Nordea Eiendomskreditt Nordea Hypotek Nordea Kredit Nordea Mortgage Bank Four aligned covered bond issuers with complementary roles Legislation Norwegian Swedish Danish Finnish Cover pool assets Norwegian residential mortgages Swedish residential mortgages prim
Slide 5: 2. Nordea Kredit in brief
2. Nordea Kredit in brief Habe foe: tly Nordea
Slide 6: Nordea Kredit – in brief
Nordea Kredit – in brief Q1 2021 • 100% owned subsidiary of Nordea Bank Abp - the largest Nordic financial institution • Operates as a mortgage credit institution with the main purpose of granting mortgage credit loans funded by issuing covered bonds • Founded in 1993 and supervised by the Danish FS
Slide 7: 3. Cover pool key characteristics
3. Cover pool key characteristics 7
Slide 8: Cover pool key characteristics
Cover pool key characteristics Q1 2021 Outstanding covered bonds EUR 59.1bn. Mortgage credit loans secured by mainly residential property Cover pool content (total: EUR 62.7bn.) Geographic distribution Throughout Denmark with concentration in urban areas Weighted average LTV 55.37% Average residenti
Slide 9: Loan portfolio
Loan portfolio Loan portfolio by property category Portfolio by loan type 3% Owner occ. dwellings & holiday homes 9% Private rental housing 8% Total Commercial properties 11% DKK 418.7bn Agricultural properties 69% Other properties Share of interest-only mortgages Market share1 – 14% overall 1) Mark
Slide 10: Loan portfolio by regions – and green bonds
Loan portfolio by regions – and green bonds Portfolio by regions Green bonds Since November 2019 Nordea Kredit has offered corporate customers green mortgage loans funded by designated green covered mortgage bonds (Current ISIN DK0002046689). Green loans can be granted against a mortgage on climate-
Slide 11: 4. Asset quality
4. Asset quality 11
Slide 12: Loan to value (LTV) – loans for residential and commercial properties
Loan to value (LTV) – loans for residential and commercial properties Q1 2021 Loan type Residential loans Commercial loans Weighted average LTV - indexed 58.0% 44.4% LTV buckets Nominal (DKKm) % Loans Nominal (DKKm) % Loans >0 - <=40 % 226,437 68.1% 62,568 74.8% >40 - <=50 % 43,025 12.9% 10,556 12.6
Slide 13: Asset quality
Asset quality Arrears (owner occupied dwellings and holiday homes) Loan to value (LTV) weighted average (all loans) 13
Slide 14: 5. Underwriting criteria
5. Underwriting criteria Habe foe: tly Nordea
Slide 15: Underwriting criteria
Underwriting criteria Q1 2021 Private households • Behavioural score and individual credit assessment are conducted based on income information, e.g. payslips and tax information • ”Before-after loan” household budgets are made and used in the assessment (based on 30 years annuity and fixed interest
Slide 16: 6. Covered bond framework
6. Covered bond framework Habe foe: tly Nordea
Slide 17: Danish covered bond framework
Danish covered bond framework Q1 2021 • Legal framework • The Financial Business Act • The Mortgage-Credit Loans and Mortgage-Credit Bonds, etc. Act with several detailed executive orders • Registration • An issuing institution is required to maintain a static cover pool • Mortgage deeds are registe
Slide 18: 7. Macro
7. Macro 18
Slide 19: Nordic economies – strong rebound in sight
Nordic economies – strong rebound in sight GDP development, % Unemployment rate, % Comments GDP forecasts from Economic Outlook January 2021, % • After the dramatic setback in 2020 due to the coronavirus, there appears to be light at the end of the tunnel for 2021 Country (%, y/y) 2020 2021E 2022E •
Slide 20: Nordic rates – Nordics well-equipped to handle the long-term consequences of COVID-19
Nordic rates – Nordics well-equipped to handle the long-term consequences of COVID-19 Policy rates, % Public balance/debt (2021E), % Comments • Norges Bank now expects to start increasing rates in December 2021. However, due to its conservative assumptions regarding the roll-out of vaccines, we expe
Slide 21: Households remain resilient
Households remain resilient Household debt, % Household savings, % Comments • Household savings have increased dramatically during the crisis, largely due to a decline in spending. Despite high debt levels, Nordic households’ strong finances are expected to support economic growth as soon as restric
Slide 22: Nordic housing markets heat up
Nordic housing markets heat up House prices Households’ credit growth Comments • Contrary to expectations, house prices have increased to record-high levels in all the Nordic countries during the crisis. This is not least due to the unprecedented expansionary fiscal and monetary policy in support of
Slide 23: 8. Contacts & Links
8. Contacts & Links Habe foe: tly Nordea
Slide 24: Contacts
Contacts If you have any questions, please feel free to contact: Peter Brag Senior Treasury Manager, Long Term Funding +45 3333 1663 Peter.brag@nordea.com Morten Keil Head of Covered Bonds, Long Term Funding +45 3333 1875 morten.keil@nordea.com 24
Slide 25: Links to more information
Links to more information Nordea Kredit Legislation Nordea Kredit ECBC harmonised transparency templates. Danish mortgage financing is supervised by the DFSA (Finanstilsynet). Link: https://www.nordea.com/en/investor-relations/reports-and- Link: https://finanstilsynet.dk/en presentations/bonds/n