Swedbank Ab Class A · OMXSTO:SWED_A
Swedbank Ab Class A — Q3 2017 Earnings Presentation
19 slides from Swedbank Ab Class A's earnings presentation, October 2017
Slide 1: Swedbank's third quarter 2017 results
Swedbank’s third quarter 2017 results Birgitte Bonnesen (CEO), Anders Karlsson (CFO), Helo Meigas (CRO) © Swedbank Information class Public
Slide 2: Swedish Banking: Good loan volume growth
Swedish Banking Good loan volume growth SEKm Q3 17 Q2 17 ▲QoQ • Net interest income Net interest income 3 811 3 792 19 – Continued mortgage loan volume growth and Net commission income 1 860 1 881 -21 stable back-book margins Other income 444 442 2 – Strong deposit volume growth Total income 6 115 6
Slide 3: Baltic Banking: Continued solid performance
Baltic Banking Continued solid performance SEKm Q3 17 Q2 17 ▲QoQ • Net interest income Net interest income 1 060 1 044 16 – Loan volume growth in all three countries Net commission income 565 561 4 – Stable margins Other income 219 209 10 Total income 1 844 1 814 30 • Stable net commission income To
Slide 4: Large Corporates & Institutions: Resilient result
Large Corporates & Institutions Resilient result SEKm Q3 17 Q2 17 ▲QoQ • Stable net interest income Net interest income 896 892 4 • Net commission income seasonally weaker Net commission income 525 587 -62 Net gains and losses 554 515 39 • Slower trading mitigated by FX effects Other income 32 21 11
Slide 5: Group results: Stable result
Group results Stable result SEKm Q3 17 Q2 17 ▲QoQ • Loan volume growth strengthened net Net interest income 6 208 6 090 118 interest income Net commission income 2 917 3 000 -83 Net gains and losses 525 567 -42 • Seasonally weaker net commission income Other income 768 736 32 • Weaker net gains and
Slide 6: Strong capitalisation – no excess capital
Capital Strong capitalisation – no excess capital 25.0% 24.2% 24.6% 23.9% • CET1 capital decreased by SEK 0.1bn 21.6% − Positive effect from net profit of SEK 0.9bn excl. dividend − Negative effect from PayEx consolidation of SEK 1.1bn • REA increased by SEK 12.8bn Q4 2016 Q1 2017 Q2 2017 Q3 2017 CE
Slide 7: Capital: Increased REA
Capital Increased REA SEKbn 425 • Exposure change increased, primarily due to loan volume growth 420 7.0 1.1 419.5 • Further model adjustments in -0.3 corporate portfolio relating to default 415 6.3 0.2 frequency 410 -1.5 • PayEx consolidation increases REA 406.7 405 400 Q2 2017 Exposure Rating LGD
Slide 8: Solid asset quality
Group Solid asset quality Credit impairments, SEKm Q3 17 Q2 17 ▲QoQ • Credit impairments in line with Swedish Banking 66 86 -20 expectations Baltic Banking -26 7 -33 Large Corporates & Institutions 195 307 -112 Swedbank Group 235 400 -165 Ratios Q3 17 Q2 17 Credit impairment ratio, % 0.06 0.10 Share
Slide 9: Q&A
Q&A © Swedbank Information class Public
Slide 10: Appendix
Appendix © Swedbank Information class Public
Slide 11: Swedbank – low-risk bank with strong capital
Swedbank – low-risk bank with strong capital This is Swedbank base • Low risk – a Board of Directors’ strategic priority – ensures access to funding markets and low funding cost • Retail profile and four home markets a key feature Liquidity & capital, % NSFR LCR CET1 capital ratio, CRDIV (RHS) – 86%
Slide 12: Swedbank – strong and stable earnings
Swedbank – strong and stable earnings This is Swedbank capacity • Four home markets – Sweden, Estonia, Latvia and Lithuania – Strong and stable economies – Market-leading position in all home markets – Largest customer base in all home markets • Retail profile ensures stable earnings with low volati
Slide 13: Swedbank – market leader in cost efficiency
Swedbank – market leader in cost efficiency This is Swedbank • Best-in-class cost efficiency – an executive management strategic priority • Executive management strongly focused on cost and change management Total expenses, SEK m − Integrated in corporate culture 20 Acquistion of Sparbanken Öresund
Slide 14: Swedbank enlarges its green footprint
Swedbank enlarges its green footprint Strategy Robur’s sustainability funds recognised Green Bond Framework established Swedbank’s Green Bond Framework is compliant with the Green Bond Principles. Nordic Swan Ecolabel The proceeds of each Swedbank Green Bond will be used to (re)finance loans and Nor
Slide 15: Swedbank creates value
Swedbank creates value Strategy Return on Equity >15% target 15.4% YTD Common Equity Tier 1 ratio One of the highest among European banks 23.9% Dividend per share 75% payout ratio for 5th year in a row SEK 13.20 © Swedbank Information class Source: Swedbank Fact book 3Q 2017 Public 15
Slide 16: Oil sector still under pressure
Oil sector still under pressure Asset quality • Loan portfolio negatively impacted by lower oil price, SEK 14.3bn – 1.0% of total loans gross – Derivatives exposures of SEK 1.2bn (incl. collateral) • Lower provisions* of SEK 51m in Q3 SEKbn SEKbn 10 LC&I Shipping & Offshore, loans gross, SEK 24bn 14
Slide 17: Conservative funding position
Conservative funding position Liquidity and funding • LCR 145% (Swedish FSA definition FFFS 2012:6) • NSFR 109% (Basel committee) • Issued SEK 161bn of term funding YTD Q3 2017 • Plan to issue around SEK 200bn in 2017 SEKbn Term funding issuance – completed and planned SEKbn Prefunded for more than
Slide 18: Long-term funding maturity profile
Long-term funding maturity profile Liquidity and funding Long-term funding maturity profile, by funding source Long-term funding maturity profile, by currency SEKbn SEKbn Senior unsecured debt Covered bonds 200 200 150 150 Other GBP 100 100 USD EUR SEK 50 50 0 0 2017 2018 2019 2020 2021 2022 2023 20
Slide 19: Real estate price performance – Sweden
Swedish Real estate price performance – Sweden, housing and mortgage 12 month market Single-family homes1 Tenant-owner rights2 Combined3 12M Δ 12M Δ 12M Δ Sep 16 9% 6% 8% Nov 16 9% 7% 8% Dec 16 9% 8% 9% Jan 17 9% 8% 9% Feb 17 9% 8% 9% 260 House price index, Sweden3 Mar 17 9% 8% 9% 2005=100 240 Apr 1