Sparebank 1 Ostlandet · OSL:SPOL
Sparebank 1 Ostlandet — SpareBank 1 SR-Bank — Q4 2011 Earnings Presentation
48 slides from Sparebank 1 Ostlandet's earnings presentation, Feb 8, 2012
Slide 1: 4th quarter 2011 - Preliminary annual accounts 2011
SpareBank 1 SR-Bank ASA 4th quarter 2011 Preliminary annual accounts 2011 8th February 2012 Arne Austreid, CEO Inge Reinertsen, CFO
Slide 2: Page 2 │ Preliminary accounts 2011
Page 2 │ Preliminary accounts 2011
Slide 3: Page 3 │ Preliminary accounts 2011
Page 3 │ Preliminary accounts 2011
Slide 4: Highlights Q4 and full year 2011
HIGHLIGHTS Q4 AND FULL YEAR 2011 Pre-tax profit was NOK 1,495 million (NOK 1,614 million) – Return on equity after tax: 11.2% (15.5%) Pre-tax profit for Q4 was NOK 490 million (NOK 414 million) – Return on equity after tax: 13.9% (16.9%) Moderate increase in net interest income Lending growth of 11.
Slide 5: Key figures
KEY FIGURES Return on equity Core capital ratio 17,5 % 10,2 % 10,6 % 15,5 % 9,6 % 11,2 % 31.12.09 31.12.10 31.12.11 31.12.09 31.12.10 31.12.11 Deposit-to-loan Earnings per share 63,2 % 58,1 % 6,88 6,84 57,4 % 5,42 31.12.09 31.12.10 31.12.11 31.12.09 31.12.10 31.12.11 Page 5 │ Preliminary accounts 20
Slide 6: Proposed allocation of profit for 2011
PROPOSED ALLOCATION OF PROFIT FOR 2011 2011 The dividend is based on the parent bank's Parent company profit after tax 936 result. Transferred from reserve for valuation variances 0 Available 936 In determining the size of the annual dividend, consideration will be given to the Group's Dividend 299
Slide 7: Outlook
OUTLOOK A high oil price, major new oil finds, low unemployment and increasing house building in the bank's core area. Good credit quality and low non-performance; expecting continued low losses and writedowns. See opportunity for new business with solid customers in markets with somewhat better mar
Slide 8: Income statement
INCOME STATEMENT 31.12 31.12 Group Income Statement (MNOK) 2011 2010 Q4 11 Q3 11 Q2 11 Q1 11 Q4 10 Net interest income 1 756 1 742 448 457 427 424 442 Net commission and other income 1192 1101 305 281 325 281 283 Net return on investment securities 319 571 111 7 73 128 183 Total income 3 267 3 414 8
Slide 9: Key figures
KEY FIGURES 31.12 31.12 2011 2010 Q4 11 Q3 11 Q2 11 Q1 11 Q4 10 Return on equity after tax (%) 11,2 15,5 13,9 7,2 12,6 11,2 16,9 Net interest margin (%) 1,31 1,35 1,34 1,35 1,28 1,28 1,31 Impairment losses on loans and guarantees in % of gross loans 0,13 0,23 0,18 0,11 0,05 0,19 0,28 Impairment loss
Slide 10: The Group's income profile
THE GROUP'S INCOME PROFILE 800 700 228 600 251 254 302 259 291 207 232 253 500 57 53 29 22 14 43 32 28 23 400 MNOK 300 455 437 436 442 457 448 200 427 424 427 100 0 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Net commission and other income Commission income SB 1 Boligkreditt and SB 1 Næri
Slide 11: Lending and deposit margins
LENDING AND DEPOSIT MARGINS Lending margins 2,05 % 2,09 % 2,00 % 1,96 % 1,97 % 2,00 % 1,99 % 1,96 % 1,93 % 1,53 % 1,51 % 1,32 % 1,26 % 1,22 % 1,19 % 1,06 % 1,02 % 0,99 % Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Corporate market Retail market Deposit margins 0,69 % 0,63 % 0,65 % 0,56 % 0
Slide 12: Lending volume and 12 month growth
LENDING VOLUME AND 12 MONTH GROWTH Corporate Market 15 % 45 000 35 000 12,1 % 11,8 % 11,1 % 10 % 25 000 MNOK 5% 15 000 4,8 % 2,9 % 5 000 0% 0,3 % -0,2 % (5 000) -1,1 % -1,8 % (15 000) -5 % Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Lending volume Growth % 100 000 Retail Market 20 % 16,9 %
Slide 13: Loan portfolio as at 31 December 2011
LOAN PORTFOLIO AS AT 31 DECEMBER 2011 Industry, Power/water supply and construction: 3,9 (4,9) Commodity trade / Agriculture / forestry / hotels: 1,7 (1,9) fishing: 2,9 (2,9) Shipping : 1,2 (1,2) Offshore: 5,2 (5,2) Retail customers: 32,4 (42,9) Real estate: 16,2 (16,8) Service industry: 4,7 (3,8) P
Slide 14: Exposure to shipping/offshore
EXPOSURE TO SHIPPING/OFFSHORE Dry cargo; 4,3 % Total exposure (loans and guarantees) to Product tank; Gas; 3,3 % 8,1% Other; 3,1 % shipping and offshore is NOK 11.2 billion Seismic; 10,0 % 81% of this exposure is to the offshore segment and includes: Offshore Service Vessels (OSV) Rigs Seismic Rigs;
Slide 15: Loan to collateral value ratio mortgage loans
LOAN TO COLLATERAL VALUE RATIO MORTGAGE LOANS MODERATE BORROWING IN GENERAL IN RELATION TO THE VALUE OF THE COLLATERAL Loans as percentage of collateral values - mortgages on housing Around 6 % of the exposure exceeds 70% 100 % 93,9 % of the collateral value. 90 % 80 % 68,8 % 70 % In the case of new
Slide 16: Deposits volume and 12 month growth
DEPOSITS VOLUME AND 12 MONTH GROWTH Corporate Market 35 000 20,1 % 19,5 % 20 % 30 000 16,0 % 13,3 % 15 % 25 000 10 % MNOK 20 000 4,7 % 3,7 % 3,3 % 3,0 % 5% 15 000 2,0 % 10 000 0% 5 000 -5 % - -10 % Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q3 11 Deposits volume Growth % Retail Market 45 000 15
Slide 17: Net commission and other income
NET COMMISSION AND OTHER INCOME 31.12 31.12 MNOK 2011 2010 Q4 11 Q3 11 Q2 11 Q1 11 Q4 10 Payment facilities 205 200 52 53 51 48 50 Savings/placements 136 135 34 29 37 36 34 Insurance products 153 113 53 34 34 33 33 Commission income real estate (EM1) 426 369 106 102 122 96 97 Guarantee commission 78
Slide 18: Net return on investment securities
NET RETURN ON INVESTMENT SECURITIES 31.12 31.12 MNOK 2011 2010 Q4 11 Q3 11 Q2 11 Q1 11 Q4 10 Dividend 21 47 1 1 13 6 0 Investment income, associates 209 267 67 33 58 51 94 Securities gains/losses -48 146 6 -34 -36 17 53 - of whic h c apital change in shares and c ertificates -35 135 8 -38 -33 28 71
Slide 19: Subsidiaries
SUBSIDIARIES MNOK 31.12.11 31.12.10 EiendomsMegler 1 SR-Eiendom AS Number of sales 7 502 7 183 Operating profit before taxes 91,0 58,6 SpareBank 1 SR-Finans AS Total assets (BNOK) 5,4 5,0 Operating profit before taxes 99,9 77,8 SR-Forvaltning AS Portfolio (BNOK) 5,9 6,2 Operating profit before taxes
Slide 20: Ownership interests
OWNERSHIP INTERESTS MNOK 31.12.11 31.12.10 SpareBank 1 Gruppen AS (19,5 %interest ownership) Profit after tax 95,9 165,8 SpareBank 1 Boligkreditt AS (34,4 %interest ownership) Profit after tax 23,8 25,2 SpareBank 1 Næringskreditt AS (30,7 % interest ownership) Profit after tax 7,3 1,7 Bank 1 Oslo AS
Slide 21: Operating costs – Group
OPERATING COSTS – GROUP Changed provisions/net contractual pension 83 (AFP) items and one-time effects linked to the 1 633 1 566 40 new pension schemes in 2011 reduced 62 personnel costs in 2010 and 2011 by NOK 106 million and NOK 224 million, respectively. -118 A large proportion of the Group's inc
Slide 22: Cost ratio
COST RATIO 100 % 80 % 60 % 84 % 40 % 79 % 50 % 51 % 46 % 46 % 20 % 42 % 40 % 24 % 23 % 0% Group SR-Bank EM1 SR-Eiendom SR-Forvaltning SR-Finans 31.12.2010 31.12.2011 Page 22 │ Preliminary accounts 2011
Slide 23: Impairment losses on loans and guarantees
IMPAIRMENT LOSSES ON LOANS AND GUARANTEES 31.12 31.12 Q4 Q3 Q2 Q1 Q4 Losses on loans in income statement (MNOK) 2011 2010 2011 2011 2011 2011 2010 Corporate customers 87 200 -11 14 10 75 66 Retail customers 47 10 35 3 3 5 2 Change in collective impairment losses on loans 5 24 21 13 - -29 3 Net impai
Slide 24: Impairment losses on loans
IMPAIRMENT LOSSES ON LOANS 450 0,45 0,41 400 0,38 0,38 0,4 0,35 350 0,32 98 91 0,3 300 0,25 Percentage 0,23 250 0,19 24 0,2 MNOK 200 0,13 0,15 150 0,10 288 277 5 0,1 100 210 0,01 0,05 0,01 134 50 0 10 0 -0,05 2007 2008 2009 2010 2011 Collective impairment losses on loans Individual impairment losses
Slide 25: Problem and non-performing commitments
PROBLEM AND NON-PERFORMING COMMITMENTS Non-performing commitments Performing problem commitments MNOK 0,42 % 0,42 % MNOK 0,41 % 1,26 % 1,13 % 0,35 % 0,33 % 0,34 % 0,31 % 0,28 % 0,81 % 0,73 % 1264 0,72 % 0,69 % 0,69 % 443 415 0,64 % 0,58 % 0,47 % 395 753 762 696 348 0,10 % 0,10 % 647 92 26% 30% 33% 2
Slide 26: Funding and liquidity management
FUNDING AND LIQUIDITY MANAGEMENT Funding maturity over the next 12 months 5,0 Good liquidity and access to the market. NOK Billions 4,5 4,0 3,5 3,0 Liquidity buffer of NOK 18.2 billion as at 2,5 2,0 31 December 2011. 1,5 1,0 0,5 Net refinancing need over 0,0 the next 12 months is jan. 12 mai. 12 jun
Slide 27: Solvency
SOLVENCY At year-end 2011, the core capital ratio was 12,0 11,9 10.6 %. 11,1 10,6 10,0 10,0 10,2 Due to transitional rules the minimum capital 9,6 9,4 9,3 adequacy requirements may up to 2015 be 8,7 8,2 8,5 8,3 reduced to no less than 80% in accordance 8,0 with the Basel I rules. Percentage 6,0 Spar
Slide 28: Share issue
SHARE ISSUE Fully guaranteed rights issue of up to NOK 1,500 million. Sparebankstiftelsen SR-Bank, Gjensidige ASA and companies in the SpareBank 1 Alliance are primary guarantors. The bank's other largest shareholders will be offered a place in the future syndication of the primary guarantee. The em
Slide 29: Indicative timetable
INDICATIVE TIMETABLE 11 April Expected payment of dividend for 2011 accounting year 3 May Presentation of result for Q1 2012 9 May Board proposes final subscription terms for issue 9 May Extraordinary general meeting in Sparebank 1 SR-Bank ASA adopts issue and subscription terms 10 May Existing shar
Slide 30: Appendix
APPENDIX Page 30 │ Preliminary accounts 2011
Slide 31: From ROGG to SRBANK 2 January 2012
FROM ROGG TO SRBANK 2 JANUARY 2012 CONVERSION FROM EQUITY CERTIFICATES TO SHARES Ownership interests as at 31 December 2011: – From Rogaland, Agder counties and Hordaland: 46.8% (47.5%) – From abroad: 9.6% (9.7%) – 10 largest: 33.5% (33.5%) – 20 largest: 40.3% (43.0%) Number of owners as at 31 Decem
Slide 32: 20 largest shareholders as at 2 January 2012
20 LARGEST SHAREHOLDERS AS AT 2 JANUARY 2012. 20 largest share holders per 02.01.12 Number Stake SPAREBANKSTIFTELSEN SR-BANK 72 176 308 36,2% GJENSIDIGE FORSIKRING ASA 20 713 065 10,4% SPAREBANK 1-STIFTINGA KVINNHERAD 6 069 934 3,0% ODIN NORGE 3 598 122 1,8% ODIN NORDEN 3 091 553 1,5% CLIPPER A/S 1
Slide 33: Price performance
1200 1200 1100 1100 PRICE PERFORMANCE 1000 900 SpareBank 1 SR-Bank (ROGG) 1000 900 1996–2011 800 800 700 700 NOK DNB EFFECTIVE RETURN 600 500 600 500 (DIVIDENDS REINVESTED) 400 400 300 OSEBX 300 200 200 100 100 0 0 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 SpareBank 1 SR-Bank, Total Return,
Slide 34: Rating
RATING Moody's Fitch Long-term debt A1 Long-term IDR A- Outlook Stable Outlook Stable Outlook 9th january 2012 25th march 2011 Page 34 │ Preliminary accounts 2011
Slide 35: Savings/placements – portfolio development
SAVINGS/PLACEMENTS – PORTFOLIO DEVELOPMENT 14 000 Assets under management of NOK 11.2 12 000 billion 10 000 as at 31 December 2011 – Reduced from NOK 12.5 billion as at 31 MNOK 8 000 December 2010 – 56,955 active savings contracts - NOK 44.0 6 000 million in monthly savings 4 000 Most of the assets
Slide 36: Liquidity buffer and bond portfolio
LIQUIDITY BUFFER AND BOND PORTFOLIO Liquidity buffer - survival period Of which, securities classified to Market value amortised cost NOK Billions Category MNOK Share MNOK Norwegian state/municipal 3 439 29 % 78 Foreign covered bonds 1 789 15 % 0 Norwegian covered bonds 4 927 41 % 0 Norwegian bank/f
Slide 37: Securities investments
SECURITIES INVESTMENTS Risk profile in bond portfolio Market value Percentage Risk categories Rating NOK million Total Swap facility AAA 7 816 40 % The bank has no exposure to the sovereign debt of Very low risk AAA, AA+, AA and AA- 10 206 52 % peripheral EU countries Low risk A+, A and A- 695 4% Mo
Slide 38: Risk profile of SpareBank 1 SR-Bank
RISK PROFILE OF SPAREBANK 1 SR-BANK PORTFOLIO IS DOMINATED BY COMMITMENTS WITH LOW RISK SpareBank 1 SR-Bank's portfolio distributed by riskgroups 100 % 91,7 % 92,1 % 92% of the bank's loan exposure satisfies the 80 % criteria for low and lowest risk. Expected 60 % losses in this portion of the portf
Slide 39: Risk profile of SpareBank 1 SR-Bank
RISK PROFILE OF SPAREBANK 1 SR-BANK PORTFOLIO IS DOMINATED BY COMMITMENTS WITH LOW RISK At the end of the Q4 2011, SpareBank 1 SR-Bank SpareBank 1 SR-Bank's portfolio by loss given realisation (LGR) had a total of 27 commitments with a loss 100 % potential exceeding NOK 100 million. 90 % 83,0 % 84,9
Slide 40: SpareBank 1 SR-Bank's risk profile
SPAREBANK 1 SR-BANK'S RISK PROFILE THE GOOD CREDIT QUALITY IN THE GROUP'S PORTFOLIO HAS BEEN MAINTAINED. Development of SpareBank 1 SR-Bank's portfolio distributed by riskgroups The Group's moderate risk profile remains 100 % 1,9 % 1,8 % 2,0 % 2,0 % 1,8 % unchanged. 6,0 % 6,3 % 6,3 % 6,3 % 6,5 % 90
Slide 41: Risk profile in the corporate market portfolio
RISK PROFILE IN THE CORPORATE MARKET PORTFOLIO THE QUALITY OF THE PORTFOLIO IS GOOD Development in corporate market's portfolio distributed by riskgroups 100 % The quality of the corporate market portfolio is 4,5 % 4,2 % 4,9 % 4,6 % 4,6 % 90 % 14,4 % 15,5 % 16,1 % 15,1 % 17,0 % considered good. 80 %
Slide 42: Loans to the corporate market
LOANS TO THE CORPORATE MARKET LOANS TO THE COMMERCIAL PROPERTY SECTOR Development and sale of fixed property: 2 (2,4) Purchase and sale of fixed property: 1,7 (1,7) Housing cooperative: 1 (1,1) Letting of fixed property: 11,6 (12,2) Rest loan portfolio Property management: 0,4 (0,8) All figures in p
Slide 43: Portfolio of commercial property for rent
PORTFOLIO OF COMMERCIAL PROPERTY FOR RENT THE PORTFOLIO IS DOMINATED BY LOW RISK COMMITMENTS. SpareBank 1 SR-Bank's portfolio in commercial property for rent distributed The portfolio of commercial property for rent by riskgroups 100 % 3,1 % 2,7 % 4,8 % 3,8 % 3,5 % represents the Group's largest con
Slide 44: Retail market – risk profile
RETAIL MARKET – RISK PROFILE POTENTIAL LOSSES ARE LOW Development in retail market division distributed by risk groups 0,6 % 0,5 % 0,5 % 0,6 % 0,3 % The quality of the retail market portfolio is very 100 % 90 % 1,5 % 1,3 % 1,1 % 1,6 % 1,0 % good. 80 % 70 % 60 % The development is characterised by st
Slide 45: SpareBank 1 SR-Bank
SPAREBANK 1 SR-BANK EiendomsMegler 1 SpareBank 1 SR-Eiendom AS SR-Finans AS SR-Investering AS SR-Forvaltning AS (100%) (100%) (100%) (100%) » Residential property brokerage » Leasing » Investments in long-term » Asset management » Commercial property brokerage » Special financing equity instruments
Slide 46: SpareBank 1 Alliance structure
SPAREBANK 1 ALLIANCE STRUCTURE SpareBank 1 SpareBank 1 SpareBank 1 Sparebanken Samarbeidende Norwegian Federation SR-Bank ASA SMN Nord-Norge Hedmark Sparebanker of Trade Unions (LO) (19,5%) (19,5%) (19,5%) (12%) (19,5%) (10%) SpareBank 1 Gruppen AS SpareBank 1 ODIN Owned directly Skadeforsikring AS
Slide 47: Recommended by the customer
RECOMMENDED BY THE CUSTOMER SPAREBANK 1 SR-BANK'S STRATEGY VÅR HENSIKT We shall be southern and western Norway's most SpareBank 1 SR-Bank shall create value for the attractive supplier of financial services region of which we are part Based on: • Good customer experiences OUR VALUES • Strong team sp
Slide 48: Contact details
CONTACT DETAILS Bjergsted Terrasse 1 Arne Austreid Inge Reinertsen Postboks 250 CEO CFO 4066 Stavanger -- -- Telefon: Telefon: Tlf: 02002 +47 900 77 334 +47 909 95 033 E-post: E-post: arne.austreid@sr-bank.no inge.reinertsen@sr-bank.no www.sr-bank.no Vidar Torsøe Investor Relations -- Telefon: +47 9