SpareBank 1 Helgeland · OSL:HELG
SpareBank 1 Helgeland — Helgeland Sparebank — Q3 2013 Earnings Presentation
48 slides from SpareBank 1 Helgeland's earnings presentation, 2013
Slide 1: Presentation for the 3rd quarter 2013
Presentation for the 3rd quarter 2013 A driving force for growth on Helgeland 1
Slide 2: Agenda and presenters
Presentation for the 3rd quarter 2013 (HSB group) Main features Jan Erik Furunes Document of goals Chief Executive Officer Profit & Loss Balance Lending Lisbeth Flågeng Deputy Chief Executive Officer Deposits Funding Solidity Inger Lise Strøm Summary Chief Financial Officer Appendices A driving forc
Slide 3: Main features: profit and loss for the quarter
Main features Profit and loss for the quarter Improved basic operations also in the 3rd quarter, no large one-time-effects • Gross profits MNOK 76 (53) Improvements in key figures • Significantly increased net interest 1.82 (1.53) % • Low costs over time 0.92 (0.93) %, in percent on income 41.5 (48.
Slide 4: Main features: profit and loss so far this year
Main features Profit and loss so far this year Additionally improved basic operations – gross profit MNOK 193 (126) • Passed the annual result from 2012 Improved profits of MNOK 67 – increased by 53 % from 30.09.12 • Net interest increased by MNOK 60 – increased by 23% from 30.09.2012 • Net value ch
Slide 5: Document of goals
Main features Document of goals Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 5
Slide 6: Document of goals: financial goals
Document of goals Financial goals • Return on equity of 10% assuming normal market conditions • CET1 capital ratio of at least 12.5% and a total capital ratio up toward 18% given a counter cyclical capital buffer of 2.5% • Cost growth from 2014 maximum 3.5% • Deposit ratio of 60% • The dividend poli
Slide 7: Profit & Loss
Main features Document of goals Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 7
Slide 8: Income- and key figure developments
Profit & loss statement Income- and key figure developments Helgeland Sparebank Improvement of basic Key figures in % of average BTA operations continues 2.5 % Net interest Net income Net interest • Significantly improved in 2013 Net provision 2.0 % Net commission earnings • Stable income in NOK and
Slide 9: Income- and key figure developments
Profit & loss statement Income- and key figure developments Helgeland Sparebank Improvement of basic Key figures in % of average BTA operations continues 2.5 % Net interest Net income • Significantly improved in 2013 Net interest Net provision Net commission earnings 2.0 % Operations costs • Stable
Slide 10: Income- and key figure developments
Profit & loss statement Income- and key figure developments Helgeland Sparebank Improvement of basic Key figures in % of average BTA operations continues 2.5 % Net interest Net income Net interest • Significantly improved in 2013 Net provision Operations costs Net commission earnings 2.0 % Write-dow
Slide 11: Profit and loss accounts
Profit & loss statement Profit and loss accounts Helgeland Sparebank (HSB group) 30.09.12 30.09.13 Q3 2012 Q3 2013 Net interest- and credit provision earnings 261 321 92 117 Net provision earnings 54 57 20 22 Other operations income 4 4 1 1 Ordinary operations costs 173 177 56 59 Result basic operat
Slide 12: Profit and loss accounts
Profit & loss statement Profit and loss accounts Helgeland Sparebank (HSB group) Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Net interest- and credit provision earnings 1.53 % 1.54 % 1.55 % 1.73 % 1.82 % Net provision earnings 0.33 % 0.29 % 0.28 % 0.29 % 0.34 % Other operations income 0.02 % 0.05 % 0.02
Slide 13: Costs
Profit & loss statement Costs Helgeland Sparebank Increasing cost Operating cost developement efficiency 70 80.0 % Operations costs in % of 60 total income have a positive 70.0 % development 50 60.0 % 40 Relatively flat cost 50.0 % development in NOK 30 throughout the last 3 years 40.0 % 20 Operatio
Slide 14: Return on equity
Profit & loss statement Return on equity Helgeland Sparebank Good improvement of Return on equity and target figures return on equity Profit & loss 14 % • So far this year 9.9 (7.2) % • Return on equity in the 3rd 12 % quarter was 11.4% against 10.1% in the 2nd quarter and 10 % 8.4% in the 1st quart
Slide 15: Balance
Main features Document of goals Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 15
Slide 16: Balance- and growth development: lending
The balance Balance- and growth development Helgeland Sparebank Reduced lending growth BTA whereby lending and deposits (MNOK) Gross lending per 30.09.13: 30.000 NOK 20.8 (19.4) bn. 12-month lending growth: 25.000 MNOK 1,427 / 7.4 (8.6) % 20.000 9-month lending growth: MNOK 961 / 4.8 (6.8) % 15.000
Slide 17: Balance- and growth development: deposits
The balance Balance- and growth development Helgeland Sparebank Improved deposit growth BTA whereby lending and deposits Volume at 30.09.13: (MNOK) 30.000 NOK 12.6 (11.1) bn. 12-month deposit growth: 25.000 MNOK 1,442 / 13.0 (7.1) % 20.000 9-month deposit growth: MNOK 1,342 / 12.0 (6.5) % 15.000 3-m
Slide 18: Lending
Main features Document of goals Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 18
Slide 19: Credit growth Retail Market
Lending Credit growth Retail Market Helgeland Sparebank 12-month growth 12-month credit growth retail market 7.9 (10.7) % 25 % 9-month growth 5.9 (8.1) % Normal activity – somewhat 20 % lower growth in 2013 Lending to personal 15 % customers constitute NOK 13.4 (12.5) bn, mainly well secured mortgag
Slide 20: Credit growth Corporate Market
Lending Credit growth Corporate market Helgeland Sparebank 12-month growth 6.4 12-month credit growth corp. market (5.0) % 25 % 9-month growth 2.9 (4.4) % 20 % The growth in the corporate market has been decreasing since 2011 15 % Stricter prioritising of 10 % projects so far in 2013 5% 0% -5 % 2008
Slide 21: Gross lending Corporate Market
Lending Gross lending Corporate market Helgeland Sparebank Well diversified lending Lending distributed in sectors portfolio Lending to corporate Real estate customers constitute NOK 7.4 (6.9) bn. Farming and f orestry NOK 2.1 (2.1) bn. are loans Fishery and aquaculture to food production consisting
Slide 22: Defaults and commitments exposed to loss
Lending Defaults and commitments exposed to loss Helgeland Sparebank Good portfolio quality – Net defaulted and com. exp. to loss growth without increased risk 250 5.0 % 4.5 % Net defaults and 200 4.0 % commitments exposed to loss in % of gross lending 3.5 % have been declining since 150 3.0 % 2008,
Slide 23: Deposits
Main features Document of goals Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 23
Slide 24: Deposit ratio
Deposits Deposit ratio Helgeland Sparebank Increased deposit ratio Deposit coverage group/parent bank The deposit ratio in the HSB 90 % group was 60.3 (57.3) % Target deposit ratio in the HSB group is 60% 80 % Very good deposit growth in the quarter 70 % 60 % 50 % 2007 2008 2009 2010 2011 2012 30.09
Slide 25: Deposit growth retail market
Deposits Deposit growth retail market Helgeland Sparebank 12-month growth 6.6 Deposit growth retail market 12 mth. (8.2) % 25 % 9-month growth 6.1 (7.4)% Deposits from personal 20 % customers constitute NOK 7.8 (7.3) bn. 15 % Growth in personal customer still higher than the national average 10 % Ne
Slide 26: Deposit growth corporate market
Deposits Deposit growth corporate market Helgeland Sparebank 12-month growth 25.3 Deposit growth corp. market 12 mth. (4.8) % 30 % 9-month growth 23.0 (4.9) % 25 % Loyal customer base gives 20 % good growth in the business market – still a higher growth 15 % than the national average 10 % 20 largest
Slide 27: Customer deposits corporate market
Deposits Customer deposits corporate market Helgeland Sparebank Loyal customer base Customer deposits Of total deposits, NOK 4.8 (3.8) bn. are deposits from Municipalities the corporate market Transport and services Good diversification of Real estate deposits from businesses Construction and power
Slide 28: Funding
Main features Document of goals Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 28
Slide 29: Loans from the capital market
Funding Loans from the capital market Helgeland Sparebank Good and long term Capital market funding structure and funding maturity Duration on loans is 2.5 (2.3) yrs. 3.000 Liquidity indicator 1 was 108.2% The indicator value for the 2.500 reference banks was 105.8% at 30.09.13 2.000 Covered bonds c
Slide 30: Liquidity buffers
Funding Liquidity buffers Helgeland Sparebank Solid buffer capital Securities distributed in sectors The liquidity buffers constitute NOK 4.3 (4.2) bn. equal to 16.5 Govt./LCR 1 (17.2) % of BTA CB 1 The buffer capital consists of cash, deposits in BoN/banks and Municipalities interest bearing assets
Slide 31: Helgeland Boligkreditt AS
Funding Helgeland Boligkreditt AS Helgeland Boligkreditt Good cover pool LTV-alocation as of 30.09.2013 The cover pool: 35.0 % • Qualified loans MNOK 4,745 (4,486) • Deposits: MNOK 240 (273) 30.0 % 27.5 % • Ratio of fullness: 124 (111) % 26.9 % • Combined LTV: 50.2 (52.8) % 25.0 % 21.6 % Loans: 20.0
Slide 32: Solidity
Main features Document of goals Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 32
Slide 33: Capital ratio
Solidity Capital ratio Helgeland Sparebank Satisfactory solidity Development in capital adequacy CET1 capital ratio was 11.2% 18.0 % (11.5% at 31.12.12) – well above the current regulatory requirement of 9%, and 10% from 16.5 % 01.07.14 Core capital was 12.8% (13.1% 15.0 % at 31.12.12) Total capital
Slide 34: Capital structure and capital plan
Solidity Capital structure and capital plan Helgeland Sparebank Strengthened earnings strengthens CET1 capital Development capital adequacy CET1 capital has increased by 16,0 % Incl 70 % 40bp since the turn of the year, 15,5 % of result 14,50 % from 11.5% to 11.9% at Q3 (Inclu- 15,0 % des 70% of pro
Slide 35: Summary
Main features Document of goals Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 35
Slide 36: Prospects and priorities
Summary Prospects and priorities Target oriented work toward the bank’s strategy- and capital plan • Increase return on equity - Increase profits additionally through a better net interest • Increased risk pricing on lending - The cost efficiency will be upheld • Continued benchmarking against other
Slide 37: Prospects and priorities: Helgeland region
Summary Prospects and priorities • Helgeland has since 2007 grown in population and value creation • Helgeland has a robust and divers labour market - Unemployment slightly increasing - Governmental enterprises expand - Increased oil- and gas activity both on- and off shore - Better international ma
Slide 38: Contact information
Contact information Chief Executive Officer Business Address Jan Erik Furunes Helgeland Sparebank (+47) 75 12 83 21 / (+47) 915 70 573 Postboks 68 jan.erik.furunes@hsb.no 8601 Mo i Rana Norway Deputy Chief Executive Officer Internet Lisbeth Flågeng ECCs in general: www.egenkapitalbevis.no (+47) 75 1
Slide 39: Appendices
Main features Document of goals Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 39
Slide 40: 20 largest owners of the ECC - HELG
The bank 20 largest owners of the ECC - HELG Parent bank Per 30. 09. 13 Numbers % s hare Numbers % s hare Sparebankstiftelsen Helgeland 12 099 598 64,7 % Pareto AS 170 000 0,9 % MP Pensjon 800 000 4,3 % Citibank, N.A S/A National fin 136 147 0,7 % Sparebank 1 SMN VPS 649 047 3,5 % Nervik, Steffen 11
Slide 41: Profitable and leading
The local bank Profitable and leading Helgeland all possibilities – the region is growing both in terms of population and value creation • Helgeland Sparebank’s vision is to be a driving force for growth in Helgeland • The bank’s main goal is to maintain the position as a profitable and leading bank
Slide 42: A driving force for growth
The local bank A driving force for growth Norway’s 12th largest savings bank of 110 banks – 15 offices in 13 municipalities in the Helgeland region Bank total assets of NOK 25 billion and a market share of 50% • An independent regional bank with no alliances and quoted on the stock exchange - The
Slide 43: Solid market position
The bank Solid market position Helgeland Sparebank still has a solid market position in the Helgeland region (markedsundersøkelsen 2012): • Personal market 56 % • Youth market 56 % • Business market 60 % • Agricultural market 80 % • The customer barometer on satisfaction (76) and loyalty (83) indica
Slide 44: Helgeland all possibilities
Developmental features Helgeland all possibilities The main message in “Horizon Helgeland” published by Helgeland Sparebank in 2012: • Growing population and value creation in the Helgeland region • Growth is threatened by the European crisis • Growth is limited due to the increasing demographic pop
Slide 45: "Horizon Helgeland" summary
Developmental features ”Horizon Helgeland” summary “In ”Horizon Helgeland” central developmental features since 2007 are shown – the year before the financial crisis hit – and on to 2012. A short summary of the graphical presentation: • Helgeland’s population increases. Increased employment, low une
Slide 46: Business development and ownership
The local bank Business development and ownership Subsidiaries and associated companies 100 % 8,9 % 34% 6,5 % 48% 10 % A driving force for growth on Helgeland 46
Slide 47: Commission earnings
Profit & loss statement Commission earnings Helgeland Sparebank Commission earnings: Comm.icome and income from coreoperation A large part of the income comes from fees on payment transactions 6% 16 % Commission Life- and General insurance have a positive trend. 49 % 19 % 10 % Guarantee fee Payment
Slide 48: Management and organisational structure
The local bank Management and organisational structure The bank’s Gift fund General manager Geir Sætran A driving force for growth on Helgeland 48