Slide 1: Year-end Report 2004 Press conference
Year-end Report 2004 Press conference 23 February 2005 Lars G Nordström President and Group CEO
Slide 2: Strong results in 2004
Strong results in 2004 z Net profit 2004 up 28% to all-time high EUR 1,914m (EUR 1,490m in 2003) z Operating profit up 26% to EUR 2,284m (EUR 1,812m) z Total income up 1% to EUR 5,720m (EUR 5,639m), up 3% on a comparable basis, despite falling interest rates and competitive market environment z Tota
Slide 3: Strong income growth in fourth quarter
Strong income growth in fourth quarter z Operating profit up 16% to EUR 636m (EUR 548m in Q3) – best quarter since Q2 2001 z Total income up 8% to EUR 1,504m (EUR 1,391m in Q3) z Operating profit improved through: – Net interest income up 3% – Net commission income up 8% – commissions from payments
Slide 4: Income supported by strong volume growth
Income supported by strong volume growth 2004/03 Q4/Q3 z Lending, total +11% +4% – Mortgage lending +15% +3% – Consumer lending +8% +1% – SME lending +8% +3% – CIB lending (excl. Markets) +2% -2% z Deposits, total +9% +7% – Household deposits +4% +-0% – SME deposits +4% +4% – CIB deposits (excl. Mar
Slide 5: Income supported by strong volume growth
Income supported by strong volume growth 2004/03 Q4/Q3 z AuM, total +16% +4% – Nordic retail funds +27% +4% – Nordic private banking +16% +6% – Int. wealth mgmt & funds +32% +10% – Institutional clients -5% -3% – Life & Pension +10% +4% 5
Slide 6: Strict cost management
Strict cost management z Expenses in 2004 down 5% to EUR 3,484m (EUR 3,673m in 2003) – Staff costs down 10% – Number of FTEs down 6% z Expenses in Q4 up to EUR 925m (EUR 837m in Q3) – Restructuring charges – Variable salaries – Seasonal factors z Expenses lower in Q4 2004 than in Q4 2003 z Cost targ
Slide 7: Strong performance in all business areas
Strong performance in all business areas z Retail Banking operating profit up 10% to EUR 520m (EUR 473m in Q3) – Operating profit in Q4 2004 50% above level of Q4 2002 – Seventh consecutive quarter with increase in operating profit – Lending volumes up 3.4% in Q4; Deposit volumes up 3.8% in Q4 z CIB
Slide 8: Total shareholder return (TSR) 2003 and 2004
8 2004 2003 C O M M E R % % 0 10 20 30 40 50 60 70 80 90 100 110 120 -10 0 10 20 30 40 50 60 Z K B B A C N D K nB S N N EB A O O LL N R H R O Y D IE R P D E D D O n A IR E V B A E N IS R H E B I N OR A S SB N W A K E N D D K A S B N E B A S B A N K R K E S C B O L A C A N IE Y K TE S H G B B E N B O
Slide 9: Nordea's new financial targets
Nordea’s new financial targets Key performance indicator 2003 2004 Target Total shareholder return, % #3 #3 In the top quartile of European peer group RoE, % 12.2* 14.5* > 15% in 2005 and > 17% or in line with level of top Nordic peers from 2007 Costs, EURm 3,673 3,484 Same cost level through 2007 a
Slide 10: Well positioned to capture growth
Well positioned to capture growth z Increased focus on customers and products – After delivery on cost and capital efficiency – Track record on organic market share growth in certain product segments, e.g. mortgages – Consumer credits next challenge z Large customer base and multi-channel distributi
Slide 11: Well positioned to capture growth
Well positioned to capture growth z Uniform customer programmes a tool to reach client satisfaction and economies of scale z Improved customer satisfaction within most markets and segments z New organisational structure with fewer management layers to improve speed and time to market z Structural gr
Slide 12: Nordea Asset Management & Life – delivering growth
Nordea Asset Management & Life – delivering growth 23 February 2005 Christian Clausen Head of Asset Management & Life
Slide 13: Delivering growth in assets under management
Delivering growth in assets under management Assets under Management Net inflows (sales) 140 14,0 120 12,0 100 10,0 EUR bn 80 8,0 EURbn 60 6,0 40 4,0 20 2,0 0 0,0 2002 2003 2004 2002 2003 2004 Nordea SEB Nordea SEB Föreningssparbanken Danske Bank Föreningssparbanken Danske Bank Handelsbanken DnB NOR
Slide 14: Leading in Nordic region and in 3rd party sales in Europe
Leading in Nordic region ...and in 3rd party sales in Europe E U R m Sales and AuM through 3rd parties in Europe 80 00 70 00 60 00 50 00 40 00 30 00 20 00 10 00 0 01 02 02 03 00 04 2/ 4/ 3/ 1/ 3/ 2/ Q Q Q Q Q Q In flo w AU M z From 0 to EUR 7 bn in AuM over 4 years z Chosen as the leading Nordic ass
Slide 15: #5 Fund group in Europe by total sales 2004
#5 Fund group in Europe by total sales 2004 Top 20 Master Groups in Europe ranked by est net sales in latest year - ALL FUNDS EURm Equity Rank Master group Total Rank Master group only 1 JP Morgan Fleming 10,176 1 Schroders 5,390 2 Schroders 7,696 2 Franklin Templeton Group 5,324 3 Fortis Group 6,72
Slide 16: Strong position in Life & Pensions
Strong position in Life & Pensions Nordic players ranked by 2003 premiums (EURbn) • Investment return in Life 8.4% Skandia 2,7 for 2004 - 8% return directly to Nordea 2,5 clients in new Swedish product Danica 1,9 • Premiums up 12% Handelsbanken 1,9 from Q4 2003 to Q4 2004 DNB 1,8 • Buffers up from 4
Slide 17: A broad product range creating value
A broad product range creating value • Value equity funds – cornerstone of Nordea’s success in European fund markets • Stratega balanced funds This 2004 Luxembourg fund citation – new high-performing range of balanced funds brings the total of fund-related awards to 51 for Nordea 1, SICAV and its •
Slide 18: Performance challenges being addressed
Performance challenges being addressed • European & Global equity funds – Broader investment policies for mainstream Combining sources of products and sharper profile for specific return, using Nordea’s broad range of ”growth”-style products competencies • Traditional balanced funds – Reengineering
Slide 19: Ambition: Continued growth
Ambition: Continued growth Financial Planning Tool is at the core of the strategy for retail savings 80.000 z Cutting edge advisory concept 70.000 Financial Planning sessions Acc. number of client sessions since launch z Integrated with Retail 60.000 Banking Roll out continues at high No. of session
Slide 20: Delivering growth - Product result
Delivering growth - Product result 500 450 400 239 350 300 180 EURmn 250 200 150 180 100 206 161 50 0 11 2002 2003 2004 Life Asset Management 20
Slide 21: Year-end Report 2004 Press conference
Year-end Report 2004 Press conference 23 February 2005 Lars G Nordström President and Group CEO
Slide 22: In summary
In summary z Record result in 2004 – Strong performance in all business areas – Total shareholder return ranking among top three in European peer group for two consecutive years z Costs down 5% in 2004 z Strong revenue growth in fourth quarter – Income supported by strong volume growth z Increased a
Slide 23: Year-end Report 2004 Press conference
Year-end Report 2004 Press conference 23 February 2005 Lars G Nordström President and Group CEO
Slide 24: Income statement summary
Income statement summary EURm, 2004 2003 Chg % Total income 5,720 5,639 1 Total expenses -3,484 -3,673 -5 Loan losses, net -27 -363 Equity method 48 57 Profit before inv. earnings and 2,257 1,660 36 insurance Investment earnings, banking 8 170 Operating profit, life insurance 180 149 21 Goodwill amo
Slide 25: Income statement summary
Income statement summary EURm Q4/04 Q3/04 Chg % Total income 1,504 1,391 8 Total expenses -925 -837 11 Loan losses, net 10 2 Equity method 15 15 Profit before inv. earnings and 604 571 6 insurance Investment earnings, banking 33 -26 Operating profit, life insurance 40 42 -5 Goodwill amortisation and