Storebrand Asa · OSL:STB
Storebrand Asa — Q1 2009 Earnings Presentation
57 slides from Storebrand Asa's earnings presentation, May 6, 2009
Slide 1: Result 1st Quarter 2009 Analyst Presentation
Storebrand Result 1st Quarter 2009 6 May 2009 Analyst presentation Analyst Presentation 1st Quarter 2009 Page # Slide # • Storebrand Group 2-12 3-24 Group CEO Idar Kreutzer Back-up: • Storebrand Group 13-18 25-36 • Storebrand ASA 19-21 37-42 • Storebrand Life Group 22-28 43-56 • Storebrand Life Insu
Slide 2: Highlights Q1 2009
Storebrand Result 1st Quarter 2009 6 May 2009 Idar Kreutzer Group CEO Highlights Q1 2009 RESULT Group loss of NOK 733 million* Higher Swedish interest rates gives low return in SPP Write-downs in PE and real estate funds gives low return in SBL BALANCE SHEET Life Insurance solvency margin of
Slide 3: Storebrand Group
RESULT BALANCE OPERATIONS Storebrand Group Q1 Full year NOK mill. 2009 2008 2008 Storebrand Life (excl SPP) -135 386 351 SPP -520 63 831 Storebrand Investments 32 48 218 Storebrand Bank 9 51 68 Other -119 -12 -158 Group Profit -733 535 1.310 Write-down of intangible assets 0 0 -2.507 Amortisation* -
Slide 4: Storebrand Livsforsikring AS - weak return gives negative profit sharing
RESULT BALANCE OPERATIONS Storebrand Livsforsikring AS - weak return gives negative profit sharing Return in NOK Share of total return* Weak return in Q1 ‐8,7% Equity / PE ‐0,63 % - Group defined benefit: 0.3% - Individual and paid-up policies: 0.1% 1,6% Bonds 0,48 % 1,4% Bonds held at 0,28 % Re
Slide 5: Storebrand Investments
RESULT BALANCE SPP OPERATIONS - development in interest rate markets give weak financial return in Q1 % Development in long-term interest rates Assets Liabilities 5 Credit Reduced Stable 4,5 assets liabilities IFRS 4 accounting Increased govt. Stable SWAP and credit rates rate 3,5 SWAP Reduced Reduc
Slide 6: Storebrand Bank - losses as expected
RESULT BALANCE OPERATIONS Storebrand Bank - losses as expected Q1 Full year NOK million 2009 2008 2008 Net interest income 121 126 512 Net fee and commission income 20 18 62 Other income 19 17 89 Total income 160 160 663 Operating expenses -122 -111 -473 Profit before loss 38 50 190 Loan loss provis
Slide 7: Storebrand - repayment of subordinated debt
RESULT BALANCE OPERATIONS Storebrand - repayment of subordinated debt Storebrand Holding AB has assumed subordinated debt issued by SPP, due June Maturity structure STB Life Group 2009 (NOK bn) 6.4 Repaid April To be prepaid Storebrand Livsforsikring will 1.3 June 1.5 call dated subordinated not
Slide 8: Storebrand Livsforsikring AS - increase in loans and receivables
RESULT BALANCE OPERATIONS Storebrand Livsforsikring AS - increase in loans and receivables 100 % 6,5 % 5,8 % 5,3 % Share in loans and 90 % 3,0 % 2,4 % 2,4 % receivables increased after end of quarter Æ target 17,2 % 17,2 % 17,1 % 80 % 70 % 14,5 % 16,3 % 22,8 % ~25% 60 % 9,1 % Running yield in po
Slide 9: SPP - resilient balance sheet
RESULT BALANCE OPERATIONS SPP - resilient balance sheet SPP - Products with interest guarantee 31.03.09 Improved solvency margin increases flexibility 5,6 % 4,9 % Good liquidity premiums in the market Gradual increase in alternative investments 89,5 % Equity exposure will increase Equities F
Slide 10: Operations - growth in premium income
RESULT BALANCE OPERATIONS Operations Growth in premium income group pensions SPP synergy realisation ahead of plan Strengthen market position in Sweden 19 RESULT BALANCE OPERATIONS Storebrand Livsforsikring AS - growth in premium income Group defined benefit* Group with investment choice* 11.0
Slide 11: SPP - strengthened market position
RESULT BALANCE OPERATIONS SPP - realisation of synergies ahead of schedule 500 Cost synergies 400 - Cost synergy realisation ahead of schedule 300 - Successful transfer of SPP's AuM 200 Tax synergies MNOK - Synergies surpassed target 100 Income synergies 0 Q4 2008 Q4 2009 Q4 2010 - APE increas
Slide 12: Summary
RESULT BALANCE OPERATIONS Summary Increased long interest rates and write-down of PE and real estate funds gives weak result in Q1 Life Insurance activities repays subordinated debt totalling NOK 2.8 billion Increased allocation to bonds held at amortised cost Satisfactory solidity Good de
Slide 13: Group - IFRS accounting
Storebrand Group IFRS accounting Storebrand ASA’s group accounts are presented in accordance with the International Financial Reporting Standards (IFRS) approved by the European Union. 26 13
Slide 14: Storebrand Group - Group profit by sub-group
Storebrand Group - Group profit by sub-group Q1 Full year NOK Million 2009 2008 2008 Life activities -655 448 1.182 Investment activities 32 48 218 Storebrand Bank 9 51 68 Other activities -119 -12 -158 Group profit before amortisation and write- downs -733 535 1.310 Write-down intangible assets -2.
Slide 15: Storebrand Group - Earnings per share
Storebrand Group - Earnings per share Q1 Full year NOK Million 2009 2008 2008 Pre-tax profit -828 395 -1.716 Tax 1 -238 -505 Profit for the year -827 157 -2.221 - Minority interests -8 -6 -7 Earnings -835 151 -2.228 Earnings per share -1,87 0,37 -4,97 Average number of shares (million shares) 445,3
Slide 16: Storebrand Group - Capital adequacy
Storebrand Group - Capital adequacy Minimum Net Net Primary Primary Capital Capital Capital Ratio NOK Million 31.03.2009 31.03.09 31.03.09 31.12.08 Storebrand ASA 1.416 15.030 84,9 % 85,4 % Storebrand Life insurance 7.196 16.048 17,8 % 17,4 % Storebrand Non-life insurance 11 92 64,2 % 80,7 % Storebr
Slide 17: Storebrand Group - Other activities
Storebrand Group - Other activities Q1 Full year NOK Million 2009 2008 2008 Storebrand ASA 1) 45 661 512 Storebrand Skadeforsikring -17 -6 -3 Other companies/elimintations 2) -147 -668 -667 Total profit other activities -119 -12 -158 Amortisation intangible assets -3 -2 -10 Profit other activities a
Slide 18: Storebrand Group - Rating
Storebrand Group - Rating* Storebrand ASA Moody’s: Baa2 (N) S&P: BBB (S) Storebrand Storebrand Livsforsikring AS Bank ASA Moody’s: A2 (N) Moody’s: A2 (N) S&P: A- (S) S&P: BBB+ (S) Storebrand Kredittforetak AS Moody’s: Aaa P=positive outlook S=stable outlook N=negative outlook *per 4 May 2009 35 Stor
Slide 19: Storebrand ASA - Result
Storebrand ASA Storebrand ASA - Result* Q1 Full year NOK Million 2009 2008 2008 Group contributions and transfers 147 672 672 Interest income 26 106 272 Interest expense -42 -91 -272 Realised/unrealised gains/losses on securities -24 -7 -62 Other financial income/costs -1 1 13 Net financial items -4
Slide 20: Storebrand ASA - Quarterly development
Storebrand ASA - Quartely development 2009 2008 2007 NOK Million Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Group contributions and transfers 147 0 0 0 672 0 0 0 Interest income 26 30 46 90 106 41 28 30 Interest expense - 42 - 52 - 50 - 79 - 91 - 37 - 28 - 26 Realised/unrealised gains/losses on securities - 24 - 16 -
Slide 21: Storebrand ASA - Satisfactory funding situation
Storebrand ASA - Satisfactory funding situation NOK 0.4 bn in senior unsecured notes issued 10 March 2009 Maturity structure Storebrand ASA (NOK bn) 1,3 1,3 Storebrand ASA has liquid 0,8 assets of NOK 1.5 bn, plus 0,4 €75 million in undrawn credit 2H 2009 2H 2010 2011 2012 available Bank debt Dr
Slide 22: Storebrand Life Group - Result per line of business
Storebrand Life Group Storebrand Life Group - Result per line of business Q1 Full year NOK Million 2009 2008 2008 Storebrand Livsforsikring AS -139 382 338 SPP Group -520 63 831 Other subsidiaries (inclusive Storebrand Helse) 4 4 14 Profit life group before amortisiation cost -655 448 1.183 Amortisa
Slide 23: Storebrand Life Group - Profit and loss
Storebrand Life Group - Profit and loss Q1 Full year NOK Million 2009 2008 2008 Premiums written 8.388 8.986 23.902 Net transfers of premium reserve 906 2.193 2.738 Net income of common portfolio -605 -5.210 3.382 Net income of investment choise portfolio -899 -4.362 -10.499 Net income of company po
Slide 24: Storebrand Livsforsikring - Per line of business Q1 2009
Storebrand Livsforsikring - Per line of business Q1 2009 Storebrand SPP Other Total NOK Millon Livsforsikring AS Group Group Group Interest result -1.185 -523 -1.708 Administration result -61 -21 -82 Risk result 188 25 213 Other results 151 -1 4 154 Profit before additional statutory allocations -90
Slide 25: Storebrand Life Group - Solvency margin and capital adequacy
Storebrand Life Group - Solvency margin and capital adequancy Solvency margin Solvency margin NOK Million capital requirement Solvency margin Storebrand Life Group 14.732 9.985 147,5 % Storebrand Livsforsikring AS 21.151 6.616 319,7 % SPP Group 6.191 3.315 186,8 % Eligible Risk weighted subordinated
Slide 26: Storebrand Life Group - Balance sheet
Storebrand Life Group - Balance sheet 31.03.09 31.12.08 NOK Million Amount Share Amount Share Immaterial assets 6.444 2% 7.070 2% Real estate 22.192 7% 22.569 7% Long term shares and interests from group companies 48 0% 48 0% Bonds held to maturity 23.793 8% 21.762 7% Mortgage and other loans 3.704
Slide 27: Storebrand Life Group - Solvency margin and buffer capital
Storebrand Life Group – Solvency margin and buffer capital Storebrand Livsforsikring AS* SPP incl. Euroben 187 % 160 % 148 % 135 % 2,2 % 1,9 % 9,7 % 7,8 % Q4 2008 Q1 2009 Q4 2008 Q1 2009 1 ASR as % of insurance reserves CB as % of insurance reserves Solvency margin Life Group Solvency margin SPP *So
Slide 28: Storebrand Life Group - New premiums APE
Storebrand Life Group - New premiums APE Q1 Full year NOK Million 2009 2008 2008 SBL AS (exclusive SPP) 599 765 1.583 SPP Group 364 265 913 Other (incl. Storebrand Health Insurance) 12 22 80 Total 975 1.052 2.576 New premiums consist of new sales and increased sales on existing contracts with subtra
Slide 29: Storebrand Livsforsikring - Profit analysis
Storebrand Life Group Norwegian Activities Storebrand Livsforsikring - Profit analysis Q1 Full year NOK Million 2009 2008 2008 Interest result -1.185 -288 -2.137 Administration result -61 -101 -255 Risk result 188 216 737 Other results 151 178 408 Profit before additional statutory allocations -907
Slide 30: Storebrand Livsforsikring - Profit to owner
Storebrand Livsforsikring - Profit to owner Individual Group polices pension and paid- Group and unit up polices, pension linked fee Risk profit- Company Total Q1 Total Q1 NOK Million fee based based products sharing portfolio 2009 2008 Administration result -7 - 31 - 18 1 -55 -62 Interest result 2
Slide 31: Storebrand Livsforsikring AS - Asset allocation
Storebrand Livsforsikring AS - Asset allocation Q1 Full year NOK Million 2009 2008 2008 Equity Norwegian *) 1.844 10.503 2.658 Equity Foreign *) 20.466 30.901 23.814 Real Estate 23.725 22.670 23.923 Money market 23.578 18.336 13.996 Bonds held to maturity 23.793 40.154 21.762 Bonds 71.554 47.305 79.
Slide 32: Storebrand Livsforsikring AS - Norwegian operations
Storebrand Livsforsikring AS - Norwegian operations Defined benefit portfolio Paid-up polices Individual 5% 6% 5% 4% 4% 7% 2% 2% 3% Equity 17 % 18 % 17 % Bonds 31 % Money market HTM 38 % Real estate 45 % Alpha Other 15 % 13 % 21 % 17 % 17 % 13 % Value adjusted return (YTD): 0,3 % 0,1 % 0,1 % Booked
Slide 33: Storebrand Livsforsikring AS - Unrealised gains
Storebrand Livsforsikring AS - Unrealised gains Change NOK Million Q1 31.03.2009 Shares -1.766 -4.819 Fixed interest investments -186 1.222 Short term investments -1.952 -3.597 Bonds held to maturity -311 -627 Total -2.263 -4.224 65 Storebrand Livsforsikring AS - Premiums excl. reserves transferred
Slide 34: Storebrand Livsforsikring AS - Net transfers of premium reserves
Storebrand Livsforsikring AS - Net transfers of premium reserves Q1 Full year NOK Million 2009 2008 2008 Premium reserves recieved Group pensions 1.649 3.205 4.653 Individual life insurance 9 49 159 Unit Linked 60 41 285 1.718 3.294 5.097 Premium reserves transferred Group pensions -536 -1.045 -2.02
Slide 35: New premiums APE and bond portfolio
Storebrand Livsforsikring AS - New premiums APE Q1 Full year NOK Million 2009 2008 2008 Guaranteed products 332 575 863 - of which annual premiums 116 167 316 - of which single premiums 217 408 548 Defined Contribution and Unit Linked 137 152 528 - of which annual premiums 116 116 426 - of which sin
Slide 36: Bond portfolio (2) - Loans and receivables
Storebrand Livsforsikring - Bond portfolio (2) BUSNAME AAA AA A BBB Unrated Total Loans and Recievables portfolio Asset Backed 3,0 % - - - - 3,0 % Banking - 15,9 % 5,7 % 0,2 % 4,3 % 26,1 % Basic Industry - 1,2 % - 0,1 % - 1,3 % Commercial Mortgage Backed 3,3 % 0,3 % - - - 3,6 % Energy - - - - 0,2 %
Slide 37: SPP Group - Result
SPP Group Profit and loss Balance sheet Exchange rates used statement figures statement figures 2008 Q1 Kurs NOK/SEK 0,8570 0,8570 2008 Q2 Kurs NOK/SEK 0,8478 0,8478 2008 Q3 Kurs NOK/SEK 0,8487 0,8479 2008 Q4 Kurs NOK/SEK 0,8547 0,8854 2009 Q1 Kurs NOK/SEK 0,8187 0,8167 SPP Group - Result Q1 NOK Mil
Slide 38: SPP incl. Euroben - Results per line of business
SPP incl. Euroben - Results per line of business Guaranteed Unit Euroben Company Sum NOK Million products Linked portfolio* 1. kvartal Adm. Result -41 10 0 10 -21 Risk result 23 3 -1 0 25 Financial result -528 0 4 0 -523 Other 0 0 0 -1 -1 Result SPP -546 12 4 9 -520 *The company portfolio includes r
Slide 39: SPP incl. Euroben - Risk result
SPP incl. Euroben - Risk result Q1 NOK Million 2009 2008 Full year Premiums written 123 134 551 Change in security reserves 50 83 222 Claims paid -67 -75 -292 Result of reinsurance -12 -13 -51 Other -68 -58 -142 Risk result 25 71 287 77 SPP incl. Euroben - Financial result Q1 Full year NOK Million 2
Slide 40: SPP incl. Euroben - Financial result per product
SPP incl. Euroben - Financial result per product Guaranteed Unit Euroben Company Sum NOK Million products Linked portfolio' Q1 Profit sharing 2 0 3 0 6 Change in conditional bonuses 0 0 0 0 0 Change in deffered capital contribu -685 0 1 0 -684 Hedge result 197 0 0 0 197 Other -42 0 0 0 -42 Financial
Slide 41: SPP incl. Euroben - Insurance reserves per line of business
SPP incl. Euroben - Insurance reserves per line of business Q1 Full year NOK Million 2009 2008 2008 Claims reserves 91.151 91.377 98.565 Conditional bonuses 5.629 10.152 7.499 Other 57 63 62 Total claims reserves 96.836 101.592 106.127 Guaranteed Unit Euroben Sum NOK Million products Linked Claims r
Slide 42: SPP incl. Euroben - Asset allocation per line of business
SPP incl. Euroben - Asset allocation per line of business Guaranteed Unit Euroben Sum NOK Million products Linked Swedish Equity 860 0 642 1.501 International Equity 2.379 0 839 3.219 Nominall Bonds 54.527 0 4.913 59.440 Real interest Bonds 4.042 0 992 5.034 Real estate 744 0 0 744 Other 2.906 18.94
Slide 43: SPP - Allocation Defined Contribution
SPP - Allocation Defined Contribution (2) P250 P300 P520 10 % 12 % 6% 7% 2% Equity 3% Interest-bearing Alternative investments 78 % 88 % 95 % Investment return (YTD): -0.97 % -1.86% -1.53 % Interest rate guarantee p.a. : 1,25 - 2.5 % 2,75 - 4,0% 4,5 - 5.2 % AuM (incl. Conditional bonuses): NOK 6.2 b
Slide 44: SPP Group - Balance sheet (cont.)
SPP Group* - Balance sheet (cont.) Share of Share of total assets total assets NOK millions 31.03.09 31.03.09 31.12.08 31.12.08 Equity 2.984 2,6% 4.018 3,2% Minority interests' share in equity Subordinated loan capital 8.700 7,6% 8.677 6,9% Premium reserve for own account 72.265 62,9% 77.718 61,4% I
Slide 45: SPP incl. Euroben - New subscription APE
SPP incl. Euroben - New subscription APE Q1 Full Year NOK Million 2009 2008 2008 Guaranteed products 103 106 372 - of which annual premiums 74 79 286 - of which singel premiums 27 26 86 Unit Link 215 133 397 - of which annual premiums 210 128 372 - of which singel premiums 5 5 24 Euroben 27 36 86 -
Slide 46: SPP - what return is acceptable?
SPP - what return is acceptable? Return and guarantees in SPP's customer portfolios Return above the guaranteed 6% rate enables profit sharing 4% 2% Return above change in 0% liabilities rebuilds conditional DB P250 P300 P520 -2 % capital contributions (CCC) -4 % Change in discount rate (swap
Slide 47: Storebrand Investments - Highlights Q1
Storebrand Investments Storebrand Investments - Highlights Q1 Profit before tax NOK 31 million compared to NOK 48 million 1th quarter last year. Weakened margin development 1 th quarter. Good investment results in 1 th quarter 2009. 0,6 billion net income in mutal funds NOK 326 billion in
Slide 48: Storebrand Investments - Profit before tax
Storebrand Investments - Profit before tax Q1 Full year NOK Million 2009 2008 2008 Total income 100 85 419 Total costs -84 -59 -281 Net financial income/ other 16 21 79 Profit before amortisation 32 48 217 Amortisation intangible assets -1 0 -3 Profit before tax 31 48 214 Increase in total income
Slide 49: Investments - Margin development
Storebrand Investments - Margin development as of Q1 700 600 Cost/income ratio 60 500 percent* as of Q1 (56 NOK m illion 400 percent as of Q4 2008). 300 200 100 - Q1 Q3 Q1 Q3 Q1 Q3 Q1 Q3 Q1 2005 2005 2006 2006 2007 2007 2008 2008 2009 Rolling 12 months income* Rolling 12 months costs Rolling 12 mo
Slide 50: Storebrand Investments - Assets under management
Storebrand Investments - Assets under management Total assets under management NOK billion 326 97 billion increase in assets under management 227 229 101 in Q1 2009 205 217 97 billion increase in 4 29,7 22,7 23,3 24,6 20,3 the group internal 165 28,0 35,7 31,3 29,4 30,3 assets from SPP 15,8 20,0
Slide 51: Storebrand Bank Group - Highlights 1st quarter 2009
Storebrand Bank Group Storebrand Bank Group - Highlights 1st quarter 2009 The Storebrand Bank Group achieved a positive group result of NOK 3.2 million before tax in Q1 The profit before losses amounted to NOK 32 million in Q1 Good growth in deposits during the quarter – deposit-to-loan ratio
Slide 52: Storebrand Bank Group - Profit and loss
Storebrand Bank Group - Profit and loss Q1 Full year NOK Million 2009 2008 2008 Net interest income 121 126 512 Net fee and commision income 20 18 62 Other operating income 19 17 89 Total income 160 160 663 Operating expenses -122 -111 -473 Operating profit beforre losses 38 50 190 Loan loss provisi
Slide 53: Storebrand Bank Group - Balance sheet
Storebrand Bank Group - Balance sheet Share Share Nok million 31.03.09 31.03.09 31.12.08 31.12.08 Cash and deposits with central banks 1 276 2,9 % 672 1,5 % Loans to and deposits with credit institutions 424 0,9 % 334 0,7 % Financial assets designated at fair value through p&l 4 130 9,3 % 5 233 11,7
Slide 54: Storebrand Bank Group - Development in customer deposits
Storebrand Bank Group - Development in customer deposits NOK mill. 25 52 % Customer deposits have 20 50 % increased by NOK 1.2 bn in 48 % Q1 15 46 % Deposits/gross lending was 10 50.8% at the end of Q1 44 % 5 42 % 0 40 % Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 06 06 06 07 07 07 07 08 08 08 08 09 Cus
Slide 55: Storebrand Bank Group - Capital adequacy
Storebrand Bank Group - Capital adequacy Requirement for Net primary capital Capital ratio capital base (NOK million) (NOK million) 31.03.2009 31.12.2008 1 856 2 711 11.7% 10.8% Note: Storebrand Bank Group 109 Storebrand Bank Group - Covered bond programme summary* Residential/ 100% prime residentia
Slide 56: Storebrand Non-Life - Highlights Q1 2009
Storebrand Non-life Storebrand Non-Life - Highlights Q1 2009 Storebrand Non-Life reports a loss before taxes of NOK 20 million in Q1 (loss of NOK 8 million) Operating loss before amortization in Storebrand Skadeforsikring AS was NOK 15 million in Q1 (loss of NOK 14 million). Storebrand Skadefo
Slide 57: Storebrand Non-Life - Income statement
Storebrand Non-life - Income statement Q1 Full year NOK Million 2009 2008 2008 Premiums earned, net 57 33 172 Claims incurred, net -50 -27 -142 Operating expenses -23 -21 -77 Investment result 1 2 12 Operating result Storebrand Skadeforsikring AS before amortization -15 -14 -34 Oslo Reinsurance Comp