Slide 1: Year-end result
—" Ye ul “ * swedb3nk ” Year-end result ” 2 —
Slide 2: Weaker economic outlook, increased central bank rates
Sweden Latvia ● Weaker economic outlook Estonia Lithuania 8.0 ● Increased central bank rates 5.1 4.16.0 1) 2.4 3.02.6 1.62.4 0.9 1.8 0.0 -0.4 -0.3 -1.3 -0.9 2021 2022F 2023F 2024F Sweden Latvia Riksbank ECB (refi rate) Estonia Lithuania FED (upper bound) ECB (deposit rate) 30% 6.0% 20% 4.0% 10% 2.0%
Slide 3: Full year 2022 income statement
▲ ● Cost/Income ratio 0.40 Net interest income 33 157 27 048 23% ● Return on equity Net commission income 14 223 14 853 -4% 13.3 per cent Net gains and losses 1 887 2 048 -8% Other income 3 954 3 732 6% ● EPS after dilution Total income 53 221 47 681 12% SEK 19.43 Total expenses 21 415 20 847 3% Pro
Slide 4: Fourth quarter 2022 income statement
▲ ● Cost/Income ratio 0.36 Net interest income 10 921 8 360 31% ● Return on equity Net commission income 3 448 3 643 -5% 15.8 per cent Net gains and losses 763 945 -19% Other income 992 1 082 -8% ● EPS after dilution Total income 16 124 14 030 15% SEK 6.05 Total expenses 5 750 5 329 8% Profit before
Slide 5: Strong credit quality, capital buffer, dividend proposal
● Strong credit quality ● Buffer to SFSA requirement of 340bps ● Dividend proposal SEK 9.75 per share © Swedbank 5
Slide 6: Sustainable 15 per cent RoE in 2025
● Sustainable 15 per cent RoE in 2025 ● Clear business priorities ● Supported by – CET1 buffer 200bps – Cost/Income ratio 0.40 © Swedbank 6
Slide 7: Mortgage market and savings trends
● Swedish mortgage market – Lower housing prices and volumes – Increased competition ● Baltic mortgage market – Stable housing prices – Demographics support volume growth ● Savings – Raised rates on savings accounts (SEK & EUR) – Net flows from equity to fixed income funds in Sweden – Continued grow
Slide 8: Corporate loans, Sydbank partnership, new Head of LC&I
● Stable corporate loan volume – Reduced in Sweden – Increased in Baltics ● Strategic partnership with Sydbank ● New Head of LC&I recruited – Bo Bengtsson starts 1 March © Swedbank 8
Slide 9: Customer communication platform, biometrics ID, virtual assistant
● New omni-channel customer communication platform launched in Latvia ● Customer ID through biometrics ● Award for virtual assistant © Swedbank 9
Slide 10: Science-Based Targets adopted for five sectors
● Science-Based Targets adopted for five sectors ● By 2030, Swedbank will reduce financed emissions for: – Residential mortgages by 39 per cent – CRE by 43 per cent – Power generation by 59 per cent – Oil and gas by 50 per cent – Steel by 29 per cent © Swedbank 10
Slide 11: Loans development
YoY +7.3% QoQ +0.1% QoQ +0.2% 1 175 1 175 1 177 1 798 1 793 1 799 4 6 -5 -2 -1 Q3 2022 Q4 excl. FX Q4 2022 QoQ -0.3% 623 619 621 Q3 2022 Swedish Baltic LC&I Group Q4 excl. FX FX Q4 2022 Banking Banking Functions Q3 2022 Q4 excl. FX Q4 2022 © Swedbank 11
Slide 12: Deposits development
YoY +3.1% QoQ +1.6% QoQ +0.7% 699 699 704 1 291 1 298 1 277 25 7 -1 -2 -8 Q3 2022 Q4 excl. FX Q4 2022 QoQ +2.8% 592 594 578 Q3 2022 Swedish Baltic LC&I Group Q4 excl. FX FX Q4 2022 Banking Banking Functions Q3 2022 Q4 excl. FX Q4 2022 Note: Opening balance has been restated from SEK 1 285bn as cash
Slide 13: Net interest income development
QoQ +30.6% ● NIM expansion ● Adjustment of the 222 10 921 Swedish deposit 2 208 60 guarantee fee improved FX & Other by SEK 130m 8 360 72 Business-driven NII Q3 2022 Volumes Margins Treasury & Other FX & Other Q4 2022 © Swedbank 13
Slide 14: Net commission income development
QoQ -5.4% ● Cards seasonally lower – Mastercard adjustments of SEK -80m (net) 3 643 ● Asset management 20 3 448 stable -121 -29 -65 ● Corporate finance and securities up due to market maker fees Q3 2022 Cards & Asset Corporate Other Q4 2022 Payments Management Finance & Securities © Swedbank 14
Slide 15: Net gains and losses
● Strong client trading ● Treasury impacted positively by FX swaps 40 763 and CB buybacks 34 50 184 ● Liquidity portfolio valuations improved due 455 to narrowing spreads Client trading Funding Liquidity Bond inventories Other Total NGL (Treasury) portfolio © Swedbank 15
Slide 16: Other income
● Lower net insurance due to higher claims Net insurance Associates Other Other income 5 year average ● Lower income from 1 200 1 082 EnterCard 990 992 910 891 – Q3 strong due to one-off 398 1 000 impairment reversals 366 415 331 382 877 ● Slightly higher income 165 261 800 from the Savings Banks 25
Slide 17: Expenses
● Full year underlying expenses of SEK 20.5bn – SEK 20.65bn including 21 415 20 847 SEK 60m in Baltic winter 320 355 443 allowance and SEK 81m 5 842 5 750 from closure of Danish 92 5 248 5 329 144 banking operations 5 087 92 152 55 ● Total expenses of SEK 20 492 20 652 21.4bn including AML 5 750 5 6
Slide 18: Impairments of intangible and tangible assets
● Change in business outlook for card acquiring in the Nordics ● Write-down of SEK 681m in Q4 – SEK 425m of goodwill – SEK 238m of internally developed software – SEK 18m of brand ● Total impairments of intangible and tangible assets amounted to SEK 684m © Swedbank 18
Slide 19: Credit impairments Q4
● Updated macro forecasts ● Credit migrations – Property management 679 and retail sectors in 63 32 Sweden 34 343 – Manufacturing and transportation sectors in the Baltics ● Expert portfolio 207 adjustments – Releases for oil and offshore Macro Rating & stage Expert portfolio Individual Other Total
Slide 20: Credit impairments full year
● Full year impairments primarily driven by updated macro forecasts and credit 709 207 migrations -176 1 479 -65 1 042 -238 Macro Rating & stage Expert Individual New definition Other Total credit scenarios migrations portfolio assessments of default impairments adjustments © Swedbank 20
Slide 21: Commercial real estate exposure
● Focus on strong cash flows and collateral Residential Sweden 4% 10% 2% 8% Commercial 29% Estonia ● Continuous dialogue 16% 5% 1% Industrial & SEK Latvia SEK with customers Warehouse Lithuania 293bn 293bn Other Norway ● Top 20 exposures at Finland 45% 80% comfortable levels Interest Coverage Ratio
Slide 22: Risk exposure amount development
● Baltic model calibration due to new definition of IRB OH-related default adding SEK 11bn REA effects 2.4 809.4 ● Article 3 add-on of 35.8 5.9 0.5 4.4 SEK 36bn to frontload 10.9 3.5 estimated IRB overhaul 753.1 impact on REA – IRB application process expected to last into 2024 – Basel IV implementa
Slide 23: CET1 capital ratio
● CET1 capital ratio of 17.8 per cent ● CET1 capital requirement 340bps buffer increased by 9bps in Q4 18.5% 0.5% 17.8% due to higher CCyB in -0.3% -0.9% -0.0% Estonia 14.4% ● 100-300bps capital buffer target range remains Q3 2022 NDoD, Change in Profit after Other Q4 2022 CET1 capital Baltics Artic
Slide 24: Summary: cost control, liquidity, capital, credit quality
● Strong cost control ● Strong liquidity and capital position ● Strong credit quality ● Return on equity 13.3 per cent ● Dividend proposal SEK 9.75 per share © Swedbank 24
Slide 25: A sustainable bank is a profitable bank
“A sustainable bank isa profitable bank”
Slide 26: Swedbank
Swedbank Oo Ag 4 “> ee 4 or : * Py