SpareBank 1 Helgeland · OSL:HELG
SpareBank 1 Helgeland — Helgeland Sparebank — Q2 2019 Earnings Presentation
50 slides from SpareBank 1 Helgeland's earnings presentation, 2019
Slide 1: En drivkraft for vekst på Helgeland
Presentation Q2 2019 En drivkraft for vekst på Helgeland 1 En drivkraft for vekst på Helgeland
Slide 2: Presentation per 30.06.19 (HSB Group)
Presentation per 30.06.19 (HSB Group) Main Features Hanne J. Nordgaard Helgeland Chief Executive Officer Profit & loss Lending Deposits Funding Sverre Klausen Chief Financial Officer Solidity Prospects and priorities Appendices 2 En drivkraft for vekst på Helgeland
Slide 3: Main features per 30.06.19
Main features per 30.06.19 Gross profit MNOK 178 (143) ROE 8.1 (7.0) % Total assets 34.1 (32.3) bn Solidity CET1 14.9 (15.1) % 50% profit included CET1 15.2 (15.4 % 3 En drivkraft for vekst på Helgeland
Slide 4: Financial targets
Financial targets ROE: CET1: 10 % 15.0 % Dividend ratio: Cost growth: 50 % <= 1 % Of the dividend basis 4 En drivkraft for vekst på Helgeland
Slide 5: Main features Helgeland
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 5 En drivkraft for vekst på Helgeland Mosjøen (Helgeland Reiseliv)
Slide 6: Macro
Macro Macro Helgeland Norge Growth turnover in the business community last 2 years 4.0 % 2.1 % Price growth villas Q2-19 2.7 % 1.3 % Price growth apartments Q2-19 6.6 % Unemployment 30.06.19 1.5 % 2.1 % 12 month population growth 31.12.18 -0.3 % 0.6 % Net new jobs 2018 – (job Creation) 12 6 En drivk
Slide 7: Stabile property price development
Stabile property price development Price development - sold apartments in NOK/sqm 80.000 Price development in 70.000 second quarter, 6.6 % in Helgeland and 3.5 % in 60.000 Oslo. Oslo 50.000 Trondheim 40.000 Bodø Helgeland 30.000 20.000 10.000 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q
Slide 8: Property price development
Property price development Price development - sold villas in NOK/sqm 70.000 Price development in 60.000 second quarter, 2.7 % in Helgeland and 3.1 % in 50.000 Oslo. Oslo 40.000 Trondheim Bodø 30.000 Helgeland 20.000 10.000 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2
Slide 9: Development in sqm price relative to income
Development in sqm price relative to income Helgeland has a significantly lower square meter price House price per SQM relative to income (villas) 12,0 % compared to income than areas such as Oslo, Bergen 10,0 % and Stavanger. For Helgeland, the price per square 8,0 % meter for single-family homes r
Slide 10: Unemployment
Unemployment Unemployment in %, Norge, Nordland og Helgeland The unemployment in Helgeland 3,50% and Nordland is lower than Norway 3,25% overall. 3,00% • Norge 2,1 % • Nordland 1,8 % 2,75% • Helgeland 1,5 % 2,50% 2,25% 2,00% 1,75% 1,50% 1,25% 1,00% Norge Nordland Helgeland 10 En drivkraft for vekst
Slide 11: Helgeland
Helgeland Havbruk • High export value and Helgeland is the engine in Northern Norway • Great investment willingness • Not negatively affected by toxic algae spring -19 Kraft • Total power production in Helgeland represents about 10% of production in Norway. • Helgeland Kraft 15 power plants in the r
Slide 12: Helgeland
Helgeland Bygg og anlegg • Great construction activity on the E6 throughout the region Brønnøysundregisteret - new building • Airport, hospital • Total planned investments in Helgeland for the next 7 years NOK 70-80 billion Turisme • Increased tourism - has passed Lofoten in the number of hotel nigh
Slide 13: Helgeland
Helgeland Industri • Norway's second largest industrial cluster • High quality, high efficiency • Focus on circular economy - especially Mo industrial park Great export value Personmarkedet • Stable in the number of employees • Low unemployment • Increased number of emigrants in the 30-45 age group
Slide 14: Profit & loss
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 14 En drivkraft for vekst på Helgeland Brønnøysund (Terje Rakke, Nordic Life)
Slide 15: Result
Result Change in gross profit (MNOK) Good result 200 200 71 180 180 Gross profit MNOK 178 160 01 160 05 - 36 140 140 • Decreased income from financial - 04 - 02 120 120 investments. 2018: Profit merger 100 100 Vipps and higher income from 178 associated companies. 80 80 143 60 60 • Decreased write-d
Slide 16: Profit
Profit Result Q2 Profit developement (MNOK) Gross profit MNOK 178 40% • Net ROE 8.1 % 452 460 35% 85 360 348 30% (One time effect pension MNOK 74 in Q1 2016) 107 72 25% 260 178 101 185 20% 106 76 160 15% 91 85 74 49 10% 60 94 93 80 84 5% -34 -40 0% 2016 2017 2018 Q2 2019 Q1 Q1 EE Q2 Q3 Q4 ROE % 16 E
Slide 17: Net interest
Net interest Development net intr.(mnok.) and % of average BTA • Higher funding costs with increased Nibor interest rates 200 • The net interest rate has been reduced in the last quarter as a result of reversed interest rates on 141 141 140 145 142 145 recorded losses. 150 • Interest rate change in
Slide 18: Provision
Provision Development net provision income • Stable provision income 0,30% 0,28% 0,28% 0,27% 85 86 90 45 2016 2017 2018 Q2 2019 Net provision income (MNOK) In % of BTA 18 En drivkraft for vekst på Helgeland
Slide 19: Helgeland Sparebank - product companies
Helgeland Sparebank - product companies 7.9 % Frende is owned by 15 individual saving banks. Frende Insurance consist of the companies Frende Life insurance and Frende damage insurance. The company is owned by Helgeland Sparebank, thirteen other individual saving banks 7.5 % and Must invest AS. The
Slide 20: Operating costs
Operating costs Operating cost (mnok) and % of income 100 Stable costs in NOK • Costs in % of income so far this year 42.2 % 72 71 74 73 72 75 69 50 41,4% 42,5% 41,5% 42,7% 41,6% 34,3% 25 0 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Operation cost Operation cost % 20 En drivkraft for vekst på H
Slide 21: Loss on commitments
Loss on commitments Reduced loan losses • MNOK 20 so far this year 0,89% 0,25% 0,15% 0,14% 36 66 249 20 2016 2017 2018 30.06.19 Net loss in % of gross lending Net loss in % of gross lending 21 En drivkraft for vekst på Helgeland
Slide 22: Lending
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 22 En drivkraft for vekst på Helgeland Syv Søster (Kristian Olsen)
Slide 23: Growth
Growth Lending retail market Lending corporate market 18.812 9.639 18.110 3.9 % 9.055 5.7 % 17.128 8.273 9.5 % 6.4 % 30.06.17 30.06.18 30.06.19 30.06.17 30.06.18 30.06.19 23 En drivkraft for vekst på Helgeland
Slide 24: Credit growth
Credit growth Credit growth HSB 12-month credit growth • 12-month growth 4.7 (6.9)% 20% Locally in Helgeland • Per Q2 82.4 (83.6)% 15% PM share 10% • Target minimum 60% • Per Q2 66.3 (66.7)% 5% 0% -5% 2016 2017 2018 Q2 2019 HSB Helgeland total Statistic Norway total 24 En drivkraft for vekst på Helg
Slide 25: Credit growth CM
Credit growth CM 12-month credit growth corporate market 20% • 12 month growth CM 6.4 (9.5) % • Expecting lower 12-month growth in the rest of 2019.12-month 15% growth Q1: 7.7 % 10% 5% 0% -5% 2016 2017 2018 Q2 2019 HSB Helgeland corp. Statistic Norway corp. 25 En drivkraft for vekst på Helgeland
Slide 26: Credit growth RM
Credit growth RM 12-month credit growth retail market 20% 12 month growth RM 3.9 (5.7) % • The bank’s market shares are 15% stable 10% 5% 0% -5% 2016 2017 2018 Q2 2019 HSB Helgeland pers. Statistic Norway pers. 26 En drivkraft for vekst på Helgeland
Slide 27: Lending CM
Lending CM Lending distributed in sector Good diversification in the CM lending portfolio and loyal corporate customers 11,7 % Real estate 10,7 % Share CM of total lending 33.9 5,1 % (33.3)% or MNOK 9 639 Farming and forestry 5,1 % (9 055) 4,8 % Construction and power 5,4 % 4,1 % Transport and servi
Slide 28: Non-performing and other impaired commitments
Non-performing and other impaired commitments Net defaulted and com. exp. to loss Net non-performing and other 600 impaired commitments amounts to 500 MNOK 340 an decrease of MNOK 80 since year end. The sale of the hotel 400 in second quarter of 2019 has reduced net default and doubtful 300 commitme
Slide 29: Deposits
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 29 En drivkraft for vekst på Helgeland
Slide 30: Deposit growth
Deposit growth 12-month growth 7.7 (0.4)% 12-month deposit growth 20% RM share • Per Q2 57.2 (59.5)% 15% Locally in Helgeland •Per Q2 90.2 (89.6)% 10% Deposit ratio 5% • Target minimum 60% • Per Q2 64.4 (62.6)% 0% -5% 2016 2017 2018 Q2 2019 HSB total Helgeland Statistic total Norway 30 En drivkraft
Slide 31: Deposit growth CM
Deposit growth CM 12-month deposit growth corporate market 12-month growth CM 13.7 (-5.7)% 35% 30% 25% 20% 15% 10% 5% 0% -5% -10% 2016 2017 2018 Q2 2019 HSB Helgeland Corp. Statistic Norway Corp. 31 En drivkraft for vekst på Helgeland
Slide 32: Deposit growth RM
Deposit growth RM 12-month deposit growth retail market 12-month growth RM 3.6 (4.2)% 20% 15% 10% 5% 0% -5% 2016 2017 2018 Q2 2019 HSB Helgeland pers. Statistic Norway pers. 32 En drivkraft for vekst på Helgeland
Slide 33: Deposits CM
Deposits CM Innskuddsfordeling BM av sum innskudd 9,2 % Well diversified deposit Kommuner 10,9 % portfolio in the CM 10,5 % Transport og tjenesteyting 10,1 % Share CM 42.8 (40.5)% or 3,4 % Bygg, anlegg og kraft 3,1 % MNOK 7 843 (6 899) of total 5,0 % deposits Fiske og havbruk 2,9 % Eiendomsdrift 6,1
Slide 34: Funding
Main features Helgeland Profit & Loss Lending Deposits Funding Solidity Prospects and priorities Appendices 34 En drivkraft for vekst på Helgeland Mosjøen (Helgeland Reiseliv)
Slide 35: Funding
Funding Funding development (MNOK) 120% 100% 2,8 % 2,1 % 2,5 % 2,5 % 17,5 % 19,3 % 22,0 % 22,3 % 80% 19,2 % 18,7 % 15,4 % 17,1 % 60% 40% 60,5 % 59,9 % 58,4 % 59,8 % 20% 0% 2016 2017 2018 Q2 2019 Deposits Swap agreement Senior CB FO 35 En drivkraft for vekst på Helgeland
Slide 36: Funding
Funding Maturity of loans (MNOK) Good and long term funding 3.000 Share long term funding 2.500 94.1% (92.5)% Combined duration of 2.8 2.000 (3.0) years. Duration in the 1.500 1.500 1.500 mortgage company 3.1 years 1.500 705 1.500 1.000 500 1.152 1.000 1.000 1.000 130 400 0 97 2019 2020 2021 2022 20
Slide 37: Helgeland Boligkreditt AS
Helgeland Boligkreditt AS Helgeland boligkreditt AS, fully owned by Helgeland Sparebank • Net profit MNOK 26.1 (26.8). • CET1 ratio of 17.8 (19.8)% • standard method with 35% mortgage weights • Gross loans amounts to MNOK 7 637 (6 960) and CB MNOK 6 842 (6 127) Good security in the lending portfolio
Slide 38: Solidity
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 38 En drivkraft for vekst på Helgeland Havmannen (Lars Solbakken)
Slide 39: Liquidity buffer
Liquidity buffer Sector distribution interest portfolio 33% CB 1 24% Interest bearing securities: 41% • Duration portfolio 1.6 (2.0) years Municipalities 51% • 98.7 % rated A- or better Finance Norway 1% 0% • 98.5 % CB or state-/ municipal 21% guaranteed bonds Government 23% CB 2 0% Municipality pap
Slide 40: Capital adequacy
Capital adequacy Development capital adequacy Capital ratio 22% • CET1 14.9 (15.1)% • Core capital 16.4 (16.7)% 20% 1,8 % • Total capital 18.8 (18.4)% 18% 1,7 % 2,4 % 2,4 % 2,6 % 2,4 % The Group’s capital targets included 1,6 % Pilar 2 addition of 2.2% amounts to 16% 1,6 % 1,6 % 1,6 % 14.2%. 14% If
Slide 41: HELG – the 20 largest owners
HELG – the 20 largest owners Per 30.06.19 Numbers % share Numbers % share Sparebankstiftelsen Helgeland 7 315 020 35.0 % Catilina Invest AS 256 046 1.2 % Pareto AS 1 949 392 9.3 % VPF Nordea Avkastning 244 270 1.2 % VPF Nordea Norge 1 407 987 6.7 % VPF Nordea Kapital 238 245 1.1 % Merrill Lynch Prof
Slide 42: HELG – the 20 largest local owners
HELG – the 20 largest local owners Per 30.06.19 Numbers % share Antall % % share Sparebankstiftelsen Helgeland 7 315 020 35.05 % Bakeriet Mo i Rana AS 19 998 0.10 % Helgeland Kraft AS 377 691 1.81 % Harald Svendsen 13 710 0.07 % Vigner Olaisen AS 144 653 0.69 % Dan Erik Kjellnø 13 000 0.06 % Steffen
Slide 43: HELG – EC development and liquidity
HELG – EC development and liquidity 2016 2017 2018 Q2 2019 EC fraction 75.1 % 76.5 % 76.3 % 76.4 % Number of EC's 20.9 20.9 20.9 20.9 Stock exchange price 81.0 88.0 69.5 80.0 Stock value 1 692.9 1 839.2 1 452.6 1 672.0 Accounted equity per EC 101 108 110 114 Profit per EC 13.5 9.5 5.0 4.8 Dividend p
Slide 44: Prospects and priorities
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 44 En drivkraft for vekst på Helgeland Vefsna
Slide 45: Prospects and priorities
Prospects and priorities Prospects • Adapt the calculation basis for capital adequacy given the requirement for countercyclical buffer. • Profitable growth in the retail market; maintain the market position. • Increased width sales. • Continue the restructuring of the portfolio and increase the prof
Slide 46: Appendices
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 46 En drivkraft for vekst på Helgeland
Slide 47: Profit & loss
Profit & loss Helgeland Sparebank (group) Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Net interest- and credit provision earnings 141 142 147 141 141 140 145 142 145 Net provision earnings 22 21 23 22 22 22 24 23 22 Other operatios income 1 0 2 1 3 6 6 2 0 Ordinary operat
Slide 48: Helgeland Sparebank – Subsidiary and associated companies
Helgeland Sparebank – Subsidiary and associated companies 100 % Helgeland Boligkreditt has concession as a credit company with permission to issue covered bonds. The company will ensure stable and long-term financing for the Group under competative conditions. Helgeland Invest AS is an investment co
Slide 49: Helgeland Sparebank
Helgeland Sparebank Vision: a driving force for growth in Helgeland. Business concept: to be a profitable and the leading bank in Helgeland. The bank provides financial products and services to consumers, small and medium-sized businesses, municipalities and other institutions related to Helgela
Slide 50: Contact information
Contact information Head office Board of directors Postal address Postboks 68, 8601 Mo i Rana Stein Andre Herigstad-Olsen, chairman Visiting address Jernbanegata 15, 8622 Mo i Rana Bjørn Audun Risøy, deputy chairman Marianne Terese Steinmo Phone number 75 11 90 00 Siw Moxness Web www.hsb.no Nils Ter