Aktia Bank PLC Class A · OMXHEX:AKTIA
Aktia Bank PLC Class A — Debt Investor Presentation (April 2024)
40 slides from Aktia Bank PLC Class A's debt investor presentation, Apr 30, 2024
Slide 1: Debt Investor Presentation
30 APRIL 2024 _ Debt Investor Presentation
Slide 2: Highlights Q1
. 12024 Debt Investor Aktia Presentation Highlights Q1 * — Aktia's strong performance continued in Q1. ee Eee : == = * Good comparable operating profit, driven by a high net interest income. ¢ Important key metrics such as C/I ratio and ROE improved. ¢ Assets under management increased slightly and
Slide 3: Total operating income 10% above last year
. Q1 2024 Debt Investor Aktia Presentation Top line growth driven by NII and strong income from life insurance in Q1. Interest income from lending has been supported by favorable margin development as the growth is attributable to corporate lending and higher margin product mix. However, cost of mar
Slide 4: Composition of the Group net interest income
. Q1 2024 Debt Investor Aktia Presentation 30/04/24 Composition of the Group net interest income EUR million 389 39.1 10 395 90 33.8 70 318 50 = Lending Liquidity portfolio 30 33 = Other (mainly deposits in Bank of Finland) 49 58 [ 7 65 | Borrowing (incl. Deposits & covered bonds) 10 : 80 87 18 Seni
Slide 5: 30/04/24
Aktia 30/04/24
Slide 6: NII supported by corporate lending
Q12024 Debt Investor Presentation Aktia Banking Asset Management Life Insurance 30/04/24 6 NII supported by corporate lending * Strong net interest income, driven by interest income from lending and growth in profitable financial solutions. ¢ Demand for hire purchase and leasing financing remained s
Slide 7: Assets under Management grew slightly
. Q1 2024 Debt Investor Aktia Presentation Banking Asset Management Life Insurance 30/04/24 Assets under Management grew slightly * AuM grew slightly in Q1, as market environment remained mainly positive. * Growth was supported by strong net sales in the banking business and in Private Banking. * To
Slide 8: Insurance service result remained solid
. Q1 2024 Debt Investor Aktia Presentation Banking Asset Management Life Insurance 30/04/24 Insurance service result remained solid * — Sales of risk life insurance policies continued to developed well. * — Sales of investment-linked insurances were strong. ¢ Favourable market development had a posi
Slide 9: 12024 Debt
Aktia 12024 Debt Investor Presentation
Slide 10: Aktia's sustainability in Q1/2024
Aktia Q1 2024 Debt Investor Presentation 30/04/24 10 Aktia’s sustainability in Q1/2024 Our mission is to build wealth for our customers and society, not only today but also for generations to come. The financial sector can play a major role in the green transition. Q1/2024 highlights New active owne
Slide 11: Sustainability-driven success for the leading wealth manager bank
Aktia Q1 2024 Debt Investor Presentation 30/04/24 " ° oye e Sustaina bility-d riven success for the ~ 2026 target achieved leading wealth manager bank Prosperity & Planet People Principles of Governance Share of SFDR Article 8 and 9 classified funds QO Siqni Flame Index* 229 SHE Index*** Aktia’s ESG
Slide 12: Financial overview
Financial overview Aktia
Slide 13: Financial summary Q1
Q12024 Debt Investor Aktia Presentation Financial summary Q1 EUR million Q1/2023 A% Q4/2023 A% Total operating income 3 70.3 10% 75.2 3% Net interest income 391, 318 23% 38.9 0% Net commission income 301 30.3 0% 298 % Net income from life insurance 77 72 T% 60 27% Other income 04 10 59% 05 -7% Total
Slide 14: Balance sheet total EUR 12,107 million
Aktia Q12024 Debt Investor Presentation Balance sheet total EUR 12,107 million Total assets ™ Lending to the public and public-sector entities = Liquidity portfolio Life insurance assets incl. Unit Link ™ Deposits and current account in Bank of Finland Other assets EUR million 14,000 12,037 12,107 1
Slide 15: Structure of lending and deposits
. 1 2024 Debt Investor Aktia Presentation 30/04/24 15 Structure of lending and deposits Lending Deposits 1% 8% 1% 16% ™ Households ™ Households Total ™ Corporates Total ™ Corporates 7,885 a Housing association 4,575 a Housing associations (7,866) (4,564) EUR milion EUR milion 65% profit organisation
Slide 16: Net commission income mix
. Q1 2024 Debt Investor Aktia Presentation 30/04/24 16 Net commission income mix EUR million 35 303 30.4 30.0 298 304 30 14 17 17 19 Other 25 61 61 62 59 ™ Lending 20 4a 35 36 35 Card, payment services and borrowing 6 ™ Asset management and securities 10 brokerage = Mutual funds 5 ° Q1/2023 Q2/2023
Slide 17: Operating expenses are well under control
Q12024 Debt Investor Aktia Presentation Despite high inflation, operating expenses are well under control Efficiency improvements now visible in personnel expenses and other operating expenses — despite high inflation last year IT expenses increased by 19% compared to last year, mainly reflecting ef
Slide 18: Quality of the credit portfolio
Aktia * Loan book constitutes for the major part of loans to households with residential or real estate securities. * The loan-to-value (LTV) ratio remained at a healthy level (42%). * Credit loss provisions in Q1 remained at a moderate level CEUR -2.7 million). Growth in credit card business has so
Slide 19: Outlook 2024
Aktia oa Outlook 2024 Aktia's comparable operating profit for 2024 is expected to be higher or somewhat higher than the EUR 108.4 million reported for 2023. The outlook has been prepared based on the following assumptions: ¢ Despite market uncertainty and a probable decline in interest rates, the ne
Slide 20: Credit ratings
Credit ratings
Slide 21: CET1 ratio 3.7 percentage points above the regulatory requirement
. Q1 2024 Debt Investor Aktia Presentation 30/04/24 21 CET1 ratio 3.7 percentage points above the regulatory requirement * CET1 ratio was 11.4%, thus improved 0.1 percentage points from CET 5 Q4/2023 and 0.3 percentage points from Q1/2023. Regulative % % minimum CET1 requirement ratio is currently 7
Slide 22: Regulative requirements updated
Aktia 12024 Debt Investor Presentation 30/04/24 Regulative requirements updated © Aktia Bank Group's leverage ratio was 4.3% (4Q23 4.2%) © Tier 1 capital EUR 4517 million * Total exposures EUR 10,4656 million ® At the beginning of 2024 the Finnish Financial Stability Authority has updated the MREL r
Slide 23: Funding activities
Aktia 12024 Debt Investor Presentation Funding activities * Through the first quarter of 2024, the market has remained very strong, and issuance of covered bonds in particular has been very active. Also, senior and subordinated debt markets have performed strongly. * During Q1/2023, Aktia completed
Slide 24: Sound funding profile
Q12024 Debt Investor Presentation Aktia Sound funding profile Borrowing from the public and public-sector entities stayed at EUR 4,575 million. The value of bonds issued by Aktia Bank totalled EUR 3,514.2 (4Q/23: 3,457.1) million. Aktia has EMTCN program of EUR 5 billion. All market-based funding is
Slide 25: Redemption schedule
Aktia 12024 Debt Investor Presentation Redemption schedule Remaining TLTRO redemption schedule: * December 2024: EUR 150 million Next public benchmark covered bond issue redeems in March 2026 Maturity profile, 31 March 2024 30/04/24 | ltt Under 1 man +3 man = Covered bonds issued Subordinated debent
Slide 26: High-quality liquidity reserve
Aktia Q1 2024 Debt Investor Presentation 30/04/24 26 High-quality liquidy reserve The Liquidity Coverage ratio (LCR) was 187% The unencumbered assets in the : Unencumbered Liquidity reserve, market value liquidity portfolio, which can be used EUR million 31Mar202%4 31 Dec 2023 as a liquidity reserve
Slide 27: Low risk liquidity portfolio
Aktia 12024 Debt Investor Presentation 30/04/24 27 Low risk liquidity portfolio The liquidity portfolio consists Rating distribution 31 March 2024 of high-quality assets that can be used to meet liquidity requirements Finnish . . . municipalities; no in stressed situations. rating, 4.6% Other, no ra
Slide 28: Aktia Bank as covered bond issuer
Aktia 12024 Debt Investor Presentation 30/04/24 28 Aktia Bank as covered bond issuer Aktia Bank has issued the Covered bonds as mortgage bank under the former legislation (Act on Mortgage Credit Bank Operations, MCBA 688/2010) and under the new Finnish Covered bond legislation came into effect on 8t
Slide 29: Cover pool 1 asset location
1Q 2024 Pool 1 (2023-) Pool 2 (2014-2022) Lappi 0.2% Asset Pool Balance EUR 0,610 bln. (no substitute assets) EUR 1,764 bln. (no substitute assets) No of loans / average loan balance 6,179/ EUR 98,750 26,144/ EUR 67,477 Types of loans First ranking residential mortgages and First ranking residential
Slide 30: Finland Macro and Housing update
Aktia Finland Macro and Hou update ™
Slide 31: Economic sentiment
Aktia Q1 2024 Debt Investor Presentation Economic sentiment Manufacturing industry — Outlook near future +—Current situation Saldo AY “10 V 14 -20 -30 -40 -50 -49 2012 2014 2016 2018 2020 2022 2024 Source: Aktia, Macrobond, EK. Construction — Outlook near future +—Current situation Saldo -23 2012 20
Slide 32: Gross domestic product behind trend
Aktia Q1 2024 Debt Investor Presentation 30/04/24 32 Gross domestic product behind trend Finland, quarterly gross domestic product, 2015 prices —GDP —Trend 2015-2019 Billion EUR 63 62,7 62 61 60 59 58 57 57,2 ai Q3 Qi Q3 Qi Q3 ai Q3 Qi Q3 Qi Q3 Qi Q3 Qi Q3 Qi Q3 Qi 2015 2016 2017 2018 2019 2020 2021
Slide 33: Inflation pressure is easing
Aktia 12024 Debt Investor Presentation 30/04/24 33 Inflation pressure is easing Finland, annual change in consumer and producer price indecies % 45 1 40 35 30 25 20 Producer price index, left 15 10 Nok TON DOS ° WA/ Mra 4 -10 -15 Consumer price index, right 2 1998 ©2000» 2002S 2004-«=S 2008. «= 2008
Slide 34: Labour market is normalising
Aktia 12024 Debt Investor Presentation 30/04/24 34 Labour market is normalising Job openings, latest observation 03/2024 Number 150000 125000 400000 75000 50000 - | | | il | | | | ll | il i il | | | i | 0 | | | | [ 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 ‘Source: A
Slide 35: Finnish household indebtedness decreasing
Aktia Q1 2024 Debt Investor Presentation 30/04/24 35 Finnish household indebtedness decreasing Finnish households’ indebtedness rate Percent 140 130 125 % 120 110 100 90 80 70 30 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2
Slide 36: Residential construction starts at lows
Aktia Q1 2024 Debt Investor Presentation 30/04/24 36 Residential construction starts at lows Residential construction activity Million m2, 12 month rolling sum 4,25 4,00 3,75 3,50 3,29 3,25 Completed 3,00 2,75 2,50 2,25 2,24 Starts 2,00 1,76 41,75 Permissions 2014 2015 2016 2017 2018 2019 2020 2021
Slide 37: Housing prices bottomed out?
Aktia Q1 2024 Debt Investor Presentation 30/04/24 37 Housing prices bottomed out? Price index of old blocks' of flats Index 2020=100 110.0 107.5 105.0 Capital city region 102.5 Rest of Finland 100.0 97.5 95.0 94.1 93.1 928 92.4 Whole country 90.0 Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan M
Slide 38: Housing market has been challenging
Aktia 12024 Debt Investor Presentation 30/04/24 38 Housing market has been challenging Annual change in prices of apartment blocks, 2023 Q4 Population projection, updated 9/2021 Percent 8 7 6 5 -4 3 2 4 0 Index 2019=100 One roo has 113 Tampere — Mercator 110,0 Two rooms ee 109 oulu f 1078 407 Tu ee
Slide 39: Housing market comparison
Aktia Q1 2024 Debt Investor Presentation 30/04/24 39 Housing market comparison Real House Prices, 160 150 140 130 120 110 100 90 ao [Fintand] 2010 2011-2012 2013.«—«2014_-—«2OTS_-«-2O16.~—«2OTT?_-—«20TH_~—«2OT9.-—«2URD.-—«-202T_~—«2022_~—«-2023 2024 Sources: Aktia and Macrobond
Slide 40: Building wealth for our customers and society
BOO Building wealth for our customers and society Timo Ruotsalainen, Head of Treasury +358 10 247 7211 timo.ruotsalainen@aktia.fi Aktia