Sparebank 1 Nord-norge · OSL:NONG
Sparebank 1 Nord-norge — Q2 2015 Earnings Presentation
71 slides from Sparebank 1 Nord-norge's earnings presentation, Aug 12, 2015
Slide 1: Quarterly presentation Q2 2015
Quarterly presentation Q2 2015 Tromsø/Oslo 12 August 2015
Slide 2: 2nd quarter report 2015 - Group
2nd quarter report 2015 - Group • Profits before tax: NOK 684 mill (897 mill) • ROE: 11.7 % (17.2 %) • Loan losses NOK 68 mill • Very good solidity and liquidity • Strong development in the regional economy. Continued good macroeconomic outlook for Nord-Norge 2
Slide 3: Macro and Economic trends
Macro and Economic trends SpareBank @) NORD-NORGE
Slide 4: Strong development in the economy of Nord-Norge
Strong development in the economy of Nord-Norge • Continued growth, the driving force being the export sector and infrastructure investments • Increased spillover effects from the oil and gas sector based on new fields in development and production. Uncertainty related to exploration and future deve
Slide 5: Macroeconomic indicators Northern Norway
Macroeconomic indicators Northern Norway NORWAY NORTHERN NORWAY SSB FORECASTS ESTIMATE FORECASTS PROGNOSE FOR 2014 2015 2016 2014 2015 2016 Private consumption 2,1 % 2% 1% 2% 3% 2% Government consumption 2,5 % 3% 3% 3% 3% 3% Fixed investments 1,2 % -3% - 1% 0% 3% 4% Exports 1,7 % 1% 2% 6% 7% 5% Impo
Slide 6: Seafood: Continued improvement
Seafood: Continued improvement Best half year ever for Norwegian seafood export The export value of Norwegian seafood recorded in the first half of 2015 is the highest ever. Norway exported seafood for NOK 34 billion. The total value of 34 billion corresponds to NOK 1.5 billion, or 5 per cent, more
Slide 7: Tourism: continued improvement
Tourism: continued improvement May 2015: Record for overnight accommodation in Nord-Norge The number of registered overnight stays in Nord-Norge is the highest ever. The main reason for this is an increase in hotel holiday and leisure business of 18 per cent. 253,872 overnight stays in Nord-Norge in
Slide 8: Oil and gas: New fields in production
Oil and gas: New fields in production • Goliat: ‒ First oil field in the Barents Sea ‒ Platform is being prepared on site ‒ Production-start planned late summer 2015 ‒ Operational organisation in place ‒ Polarbase – more than 50 supplier companies • Aasta Hansteen/Polarled: ‒ Several gas fields, str
Slide 9: Lower house prices compared to whole of Norway
Lower house prices compared to whole of Norway House prices, July 2015 Average price, NOK per m2, all units 50.000 41.635 40.000 35.449 32.724 30.000 22.272 18.930 19.292 20.000 10.000 0 Tromsø Bodø Finnmark Norge Troms ex Tromsø Nordland ex Bodø 9 Source: Real Estate Norway, Finn.no and Eiendomsver
Slide 10: Housing market –strong momentum in the cities
Housing market –strong momentum in the cities Price growth and turnover (days) 15% 62 60 58 11,7 % 12% 10,6 % 50 9,2 % 46 9% 40 6,9 % 6,8 % 35 6% 31 30 4,3 % 3% 22 21 20 0% 10 -3% -1,3 % 0 Tromsø (T) Bodø (B) Bergen Stavanger Oslo Northern Norway Norway excl TB Price growth y/y, all units Turnover (
Slide 11: Residential construction over the peak ?
Residential construction over the peak ? Housing starts 2.500 2.000 Northern Norway 1.500 Forecast demand Nordland 1.000 Troms Finnmark 500 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 M06 y/y 11
Slide 12: Strategy
12 Strategy SpareBank NORD-NORGE
Slide 13: For Nord-Norge!
A clear vision statement and a strong brand For Nord-Norge! 13
Slide 14: Focus on core banking
Focus on core banking • Russian exposure reduced by NOK 300 mill since 2013. Exit strategy under implementation • SpareBank 1 Markets has been restructured • Phase out of corporate lending in BN Bank has been decided • Non-core financial Investment activities is being discontinued 14
Slide 15: Modernised distribution
Modernised distribution • The physical distribution network is concentrated around 19 Financial Centres in Nord-Norge. • Co-localisation of the Group’s services within banking, real-estate agency, accounting services • 12 local brances have been merged in 2014/2015 • Digital services in the SpareBan
Slide 16: Financial figures
16 Financial figures SpareBank NORD-NORGE O
Slide 17: Main financial targets
Main financial targets Profitability: • Banking operations at top international level: Minimum 12% ROE Solidity: • Undisputable solid • Internal capital buffer of at least 1 percentage point above the statutory minimum requirement. • Long term goal for Core Tier 1 level is currently 14.5 % 17
Slide 18: Capital adequacy ratio - Group
Capital adequacy ratio - Group 13,1 % 13,4 % 12,5 % 12,3 % 10,6 % 10,3 % 9,9 % 11 % 11 % 10 % 9% 9% 8% 8% 31.12.10 31.12.11 31.12.12 31.12.13 31.12.14 31.3.15 30.6.15 Lower limit Common Equity Tier I Tier I Capital incl share of result 18
Slide 19: Profit and loss account - Group
Profit and loss account - Group (Amounts in NOK million) 30.06.15 30.06.14 31.12.14 Net interest income 737 670 1 426 Net fee-, c ommision and other operating income 478 491 966 Net income from financial investments 211 432 602 Total net income 1 426 1 593 2 994 Total costs 674 649 1 328 Result befo
Slide 20: Quarterly summary – Profit and loss account figures
Quarterly summary – Profit and loss account figures (Amounts in NOK million) 2Q15 1Q15 4Q14 3Q14 2Q14 Net interest income 368 369 378 378 342 Net fee-, commision and other operating income 239 239 237 238 248 Net income from financial investments 93 118 51 119 189 Total net income 700 726 666 735 77
Slide 21: Net interest income - Group
Net interest income - Group 21
Slide 22: Changes in net interest income last quarter
Changes in net interest income last quarter Measured against average funding cost
Slide 23: Lending margin, Parent bank
Lending margin, Parent bank 3,50 % 2,92 % 3,00 % 2,83 % 2,66 % 2,47 % 2,46 % 2,50 % 2,16 % 2,30 % 2,32 % 2,00 % 1,97 % 1,50 % 1,00 % 0,50 % 0,00 % 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 Interest margin corporate Interest margin retail Interest margi
Slide 24: Customer deposit, Parent bank
Customer deposit, Parent bank 1,00 % 0,80 % 0,60 % 0,40 % The interest margin is 0,18 % defined as the 0,20 % 0,01 % difference between 0,00 %0,04 % 0,00 % average 3 month 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 -0,25 % -0,02 % NIBOR and the -0,20 %
Slide 25: Quarterly summary – Profit and loss account figures
Quarterly summary – Profit and loss account figures (Amounts in NOK million) 2Q15 1Q15 4Q14 3Q14 2Q14 Net interest income 368 369 378 378 342 Net fee-, commision and other operating income 239 239 237 238 248 Net income from financial investments 93 118 51 119 189 Total net income 700 726 666 735 77
Slide 26: Total commission and other income
Total commission and other income 1.200 40% 36,3 % 33,5 % 32,3 % 35% 1.000 31,5 % 27,8 % 114 100 30% 800 25,1 % 25% 44 600 20% 8 19 866 52 15% 400 817 612 10% 505 487 200 425 5% 0 0% 2010 2011 2012 2013 2014 30.06.15 Total other operating income Net commision income Net fee-, commission and other in
Slide 27: Income from financial investments
Income from financial investments Group (Amounts in NOK million) 2Q15 1Q15 4Q14 3Q14 2Q14 Dividends 7 0 0 0 16 Income from joint ventures 114 112 121 142 190 Gains/losses and net value changes on shares -33 5 -69 -21 188 Net value changes on bonds, foreign exchange and fin.derivatives 4 3 5 7 65 Gai
Slide 28: Group operating costs
Group operating costs (Amounts in NOK million) 30.06.15 30.06.14 Change Wages and salaries 306 276 30 Pension costs 21 21 0 Social costs 44 24 20 Total personnel costs 371 321 50 Administration costs 180 176 4 Total personnel- and general administration costs 551 497 54 Depreciation and write-downs
Slide 29: Group operating costs
Group operating costs NOK mill. 375 3,50 % 350 7 325 7 300 + 275 7 250 7 225 7 200 - 175 + 150 + 1Q13 2Q13 3Q13 4Q13 1914 2914 3Q14 4014 1915 == Total costs — Perc.of aver.tot.ass. SpareBank @) NORD-NORGE
Slide 30: Losses on loans and guarantees - customers
Losses on loans and guarantees - customers N O K m ill 25 0 0 ,3 0 % 0 ,2 6 % 0 ,2 5 % 20 0 0 ,2 1 % 0 ,1 9 % 0 ,2 0 % 15 0 0 ,1 5 % 0 ,1 5 % 0 ,1 4 % 0 ,1 5 % 10 0 195 172 164 0 ,1 0 % 50 87 101 0 ,0 5 % 68 0 0 ,0 0 % 20 11 20 11 20 12 20 13 20 14 3 0 .0 6 .1 5 N e t lo ss es N e t lo ss es in % of
Slide 31: Core banking operations
Core banking operations- (excl. income from financial investments) (Amounts in NOK million) 2Q15 1Q15 4Q14* 3Q14 2Q14 Net interest income 368 369 378 378 342 Net fee- and commission income 215 210 212 219 221 Other operating income 24 29 25 19 27 Total costs 336 338 354 325 333 Underlying banking op
Slide 32: Group companies result before tax
Group companies result before tax (A m o unts in NO K 1000) 30.06.15 30.06.14 SpareBank 1 F inans Nord- Norge AS 60 428 58 645 SpareBank 1 Nord- Norge Port efølje AS - 43 751 33 155 SpareBank 1 Regnskapshuset Nord- Norge AS 7 143 6 579 EiendomsMegler 1 Nord- Norge AS 18 249 9 087 SpareBank 1 Nord- N
Slide 33: Key figures balance sheet
Key figures balance sheet 30.06.15 30.06.14 Change Change % Total assets 84 981 81 983 2 998 3,7% Gross lending 63 073 58 791 4 282 7,3% Loans and advances to customers incl 86 709 82 452 4 257 5,2% SpareBank 1 Boligkreditt and Næringskreditt Deposits from customers 49 977 46 949 3 028 6,4%
Slide 34: Lending volume
Lending volume Retail incl. SpareBank 1 Boligkreditt 29 % 7,0 % 6,5 % 71 % 61 539 57 802 Retail incl. SpareBank 1 54 042 Boligkreditt Corp/ Public 30.06.13 30.06.14 30.06.15 Corporate and public 40 % 2,1 % 60 % 7,5 % 24 650 25 170 22 940 Retail excl. SpareBank 1 Boligkreditt 30.06.13 30.06.14 30.06.
Slide 35: Deposit volume
Deposit volume Retail banking market Bedriftsmarked 7,4 % 8,0 % 28 945 12,4 % 3,7 % 26 955 13 599 14 101 24 966 12 095 30.06.13 30.06.14 30.06.15 30.06.13 30.06.14 30.06.15 Public -28,5 % Corp 8,4 % 28% 8 945 Retail 6 395 6 931 58% Public 14% 30.06.13 30.06.14 30.06.15
Slide 36: Credit area
Credit area NORD-NORGE SpareBank @)
Slide 37: The Group's non-performing, impaired and other problem commitments
The Group's non-performing, impaired and other problem commitments 1.100 3,00% 1.000 900 2,50% 800 700 2,00% MNOK 600 1,50% 500 400 1,00% 300 200 0,50% 100 0 0,00% 31.12.09 31.12.10 31.12.11 31.12.12 31.12.13 30.06.14 30.09.14 31.12.14 31.03.15 30.06.15 Non-performing commitments 575 492 471 397 486
Slide 38: Distribution on segments shows good diversification
Distribution on segments shows good diversification Loan portfolio including Boligkreditt Construction building 2,3 % SPB1 Boligkreditt 27,3 % Other service industry 2,3 % Agriculture, fisheries, fish farming 5 % Annet 19,5 % Wage-earners 43,7 % Transport and wholsesale 6,1 % Property Maritime secto
Slide 39: Liquidity/funding
39 Liquidity/funding SpareBank NORD-NORGE O
Slide 40: Funding instruments/diversification 30.06.15
Funding instruments/diversification 30.06.15 40
Slide 41: Maturity profile 30.06.15
Maturity profile 30.06.15 Capital markets funding (excl. SPABOL) • Good diversification in terms of maturities • NOK 20.965 mill in capital market funding exclusive of SB1 Boligkreditt • SpareBank 1 Boligkreditt is an important funding source. Mortgage loans of NOK 23.637 mill transferred as at 30.0
Slide 42: Summary
42 Summary SpareBank NORD-NORGE O
Slide 43: 2nd quarter report 2015 - Group
2nd quarter report 2015 - Group • Profits before tax: NOK 684 mill (897 mill) • ROE: 11.7 % (17.2 %) • Loan losses NOK 68 mill • Very good solidity and liquidity • Strong development in the regional economy. Continued good macroeconomic outlook for Nord-Norge 43
Slide 44: Why invest in SpareBank 1 Nord-Norge?
Why invest in SpareBank 1 Nord-Norge? 1) Continued strong macro economics in North Norway 2) Very strong position in the region 3) Profitable growth within core banking activities 4) Good solidity and capacity for profitable growth 44
Slide 45: Contact information
Contact information: SpareBank 1 Nord-Norge P o Box 6800 N- 9298 Tromsø CEO Jan-Frode Janson CFO Rolf Eigil Bygdnes Tel +47 909 75183 Tel +47 905 19 774 SNN home page and internet bank: www.snn.no Equity capital certificates in general: www.egenkapitalbevis.no Financial calendar 2015: 3Q 2015: 29 Oc
Slide 46: Enclosures
46 SpareBank NORD-NORGE O
Slide 47: SpareBank 1 Nord-Norge
SpareBank 1 Nord-Norge Vision: For Nord-Norge! Head office: Tromsø Organisation: 5 regioner Regional offices: Hammerfest Tromsø Harstad Bodø Mo i Rana Branches: 66 47
Slide 48: Organisation of the financial services Group
Organisation of the financial services Group SpareBank 1 Nord-Norge Financial Services Group SpareBank 1 Finans Nord-Norge AS SpareBank 1 Gruppen AS Equity stake 100 % Equity stake 19,5 % SpareBank 1 Boligkreditt AS EiendomsMegler 1 EiendomsMegler 1 Nord-Norge AS Equity stake 14,71 % Lofoten AS Equi
Slide 49: Main financial figures
Main financial figures NORD-NORGE SpareBank @)
Slide 50: Key figures
Key figures Net non-performing and impaired commitments Common Equity Tier I % incl(Group) share of result Returnon Return onequity equity 12,5 % 13,4 % 12,3 % 15,3 % 10,6 % 10,3 % 13,1 % 9,9 % 12,2 % 11,7 % 8,5 % 9,0 % 2010 2011 2012 2013 2014 30.06.15 2010 2011 2012 2013 2014 30.06.15 Cost/income
Slide 51: Quarterly results – net interest income
Quarterly results – net interest income (Amounts in NOK million) 2Q15 1Q15 4Q14 3Q14 2Q14 Interest and similar income from loans to and claims on credit institutions 5 3 9 13 3 Interest and similar income from loans to and claims on customers 630 652 697 699 658 Interest and similar income from cert
Slide 52: Total commission and other income
Total commission and other income (Amounts in NOK million) 2Q15 1Q15 4Q14 3Q14 2Q14 Guarantee commissions 5 8 8 7 9 Interbank commissions 4 4 5 4 5 Credit arrangement fee 3 2 2 2 2 Arrangement fee from SpareBank 1 Boligkreditt 66 76 81 80 87 Arrangement fee from SpareBank 1 NN Finans 0 1 1 1 0 Secur
Slide 53: Operating expenses
Operating expenses (in NOK million) 2Q15 1Q15 4Q14 3Q14 2Q14 Wages and salaries 147 159 152 159 134 Pension costs 12 9 11 9 13 Social costs 23 21 27 25 12 Sum personalkostnader 182 189 190 193 159 Development costs 28 29 28 27 26 Electronic data processing costs 18 18 19 17 17 Marketing costs 18 17
Slide 54: Credit growth corporates
Credit growth corporates Credit growth corporates. 12 mth growth 16 14 12 10 8 % 6 4 2 2,0 0 -2 -4 2012M06 2013M06 2014M06 2015M06 SNN, Corporate clients Norway, Corporates 54 11.08.2015
Slide 55: Credit growth households
Credit growth households Credit growth households. 12 mth growth 14 12 10 8 6 6,5 % 4 2 0 2012M06 2013M06 2014M06 2015M06 SNN, Retail clients Norway, Households 55 11.08.2015
Slide 56: Deposit growth corporates
Deposit growth corporates Deposit growth corporates. 12 mth. growth 20 15 10 5 3,7 % 0 -5 -10 2012M06 2013M06 2014M06 2015M06 SNN, Corporate clients Norway, Corporates 56 11.08.2015
Slide 57: Deposit growth households
Deposit growth households Deposit growth households. 12 mth. growth 12 10 8 7,4 6 % 4 2 0 2012M06 2013M06 2014M06 2015M06 SNN, Retail clients Norway, Households 57 11.08.2015
Slide 58: Credit area
Credit area NORD-NORGE SpareBank @)
Slide 59: Lending portfolio - comments
Lending portfolio - comments • Good increase in retail lending, with focus on commitments qualifying for SpareBank 1 Boligkreditt (covered bond company) • Lower growth in corporate market lending last 12 months than earlier periods • The portfolio and growth in corporate sector lending is diversifie
Slide 60: Loan losses: The Group's write-downs as of Q2 2015
Loan losses: The Group's write-downs as of Q2 2015 Write-downs 1st half 1st half 2nd quarter 2014 2015 2014 2015 (iso) Individual write-downs Retail market 1 3 -1 25 Corporate market 63 42 35 148 SpareBank 1 Finans Nord-Norge 3 2 2 5 Other group units 9 8 -6 16 Total individual write-downs 76 55 30
Slide 61: Group lending by sector
Group lending by sector (NOK million) 30.06.15 Share 30.06.14 Share Change Change in % Crop production, Forestry and fishing 4 140 4,8 % 3 554 4% 586 16,5 % Manufacturing, electricity and water supply, construction 3 938 4,5 % 3 597 4% 341 9,5 % Wholesale and retail trade, accomodation and food serv
Slide 62: Portfolio - exposure as of 30.06.15, parent bank
Portfolio - exposure as of 30.06.15, parent bank 40.000 35.000 30.000 25.000 NOK mill 20.000 15.000 10.000 5.000 0 Næringskreditt Boligkreditt Low risk Medium risk High risk Default/impaired Retail market Corporate market SB1 Boligkreditt SB1 Næringskreditt 62
Slide 63: Portfolio - exposure as of 30.06.15
Portfolio - exposure as of 30.06.15 Loans distributed by size of exposure and share of total exposure Share of loanexposure Jun 2015 Share of loanexposure Jun 2014 77% 77% 10% 9% 7% 8% 6% 5% Below 10 mnok 10 - 100 mnok 100 - 250 mnok Above 250 mnok Numbers includes SB 1 Bolig- and Næringskreditt 63
Slide 64: Equity certificate holders
Equity certificate holders 64
Slide 65: Equity Certificates (EC) - holder structure
Equity Certificates (EC) - holder structure 100,0 0 5,2 7,7 7,9 7,7 7,7 8,2 8,7 10,3 10,2 10,0 11,3 13,8 13,8 14,8 15,5 16,6 16,2 19,3 80 ,00 69,4 66,8 60 ,00 67,2 67,4 67,3 67,2 65,7 64,1 64,4 64,1 65,8 65,6 64,2 65,5 63,9 63,1 65,1 62,8 40 ,00 20 ,00 25,5 25,4 25,5 25,6 24,6 24,9 24,8 25,1 25,4 24
Slide 66: The 20 largest EC holders
The 20 largest EC holders Number of Share of total Equity Certificate holders Equity Certificates capital VERDIPAPIRFONDET DNB NORGE (IV) 3.810.075 3,79 % PARETO AKSJE NORGE 2.705.281 2,69 % MP PENSJON PK 2.690.503 2,68 % FLPS - PRINC ALL SEC STOCK SUB 2.232.800 2,22 % PARETO AKTIV 2 1.929.920 1,92
Slide 67: The 20 largest EC holders residing in Northern Norway
The 20 largest EC holders residing in Northern Norway Number of Share of total Equity Certificate holders Equity Certificates Equity Certificate capital SPAREBANKSTIFTELSEN SPAREBANK 1 NORD-NORGE 1.411.606 1,41 % KARL DITLEFSEN 547.543 0,55 % NORGES RÅFISKLAG 437.490 0,44 % HANSEN DAHL FISKERI AS 37
Slide 68: SpareBank 1 Group and Alliance
SpareBank 1 Group and Alliance 68
Slide 69: SpareBank 1 Alliance
SpareBank 1 Alliance • Founded 1996 with the goal of achieving Economies of Scale • Key banks in the Alliance trace their history back to the early 19th century • Operates exclusively in Norway with a large local presence – Norway’s most extensive branch network with approx. 350 branches SpareBank 1
Slide 70: SpareBank 1 Alliance – Structure overview
SpareBank 1 Alliance – Structure overview SpareBank 1 SpareBank 1 SpareBank 1 Sparebanken 11 smaller SpareBank 1 All banking and banks SR-Bank SMN Nord-Norge Hedmark Ancillary products customers The banks issue senior unsecured, subordinated and capital instruments individually Equity and debt inves
Slide 71: SpareBank 1 Alliance - market position
SpareBank 1 Alliance - market position • 2nd largest banking group in the market • More than 20% national market share in residential • SpareBank 1 is a Norwegian-only, mortgages Total Assets retailed focused institution • Regional market share leader with 30-50% shares 71Source: Banks annual report
SpareBank 1 Nord-Norge — Q2 2015 Earnings Presentation on 6ix