SpareBank 1 Helgeland · OSL:HELG
SpareBank 1 Helgeland — Helgeland Sparebank — Q4 2017 Earnings Presentation
51 slides from SpareBank 1 Helgeland's earnings presentation, 2018
Slide 1: En drivkraft for vekst på Helgeland
Presentation Q4 2017 En drivkraft for vekst på Helgeland 1 En drivkraft for vekst på Helgeland
Slide 2: Presentation per 31.12.17 (HSB Group)
Presentation per 31.12.17 (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 31.12.17
Main features per 31.12.17 Gross profit MNOK 348 (452) ROE 8.6 (13.0) % Total assets 31.9 (29.4) bn Solidity CET1 15.8 (16.1) % 3 En drivkraft for vekst på Helgeland
Slide 4: Main features 31.12.17
Main features 31.12.17 Retail market 12 month growth RM – Credit growth 5.5% – Deposit growth 3.9 % Corporate market 12 month growth CM – Credit growth 11.7% – Deposit growth 6.3 % 4 En drivkraft for vekst på Helgeland
Slide 5: Financial targets
Financial targets ROE: CET1: 10 % 15.0 % Cost growth: Dividend ratio: <= 1 % 50 % 5 En drivkraft for vekst på Helgeland
Slide 6: Helgeland
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 6 En drivkraft for vekst på Helgeland
Slide 7: Macro
Macro Macro Helgeland Nordland Norge Price growth villas Q4 0.2 % -2.8 % -1.1 % Price growth apartments Q4 3.2 % -2.0 % -2.3 % Unemployment 1.6 % 1.9 % 2.4 % 12 month population growth 0.2 % 0.3 % 0.7 % 31.12.17 (Helgeland Q3) 7 En drivkraft for vekst på Helgeland
Slide 8: Stabile property price development
Stabile property price development Price developent - sold apartments in NOK/sqm 80 000 Price increase in Helgeland 70 000 was 3.2 % and -4.4 % in Oslo 4th quarter. 60 000 Oslo 50 000 Trondheim 40 000 Bodø 30 000 Helgeland 20 000 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 201
Slide 9: Stabile property price development
Stabile property price development Price development - sold villas in NOK/sqm 70 000 Price increase in Helgeland 60 000 was 0.2 % and 0.7 % in 50 000 Oslo 4th quarter Oslo 40 000 Trondheim 30 000 Bodø 20 000 Helgeland 10 000 0 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q
Slide 10: Unemployment
Unemployment Unemployment in %, Norge, Nordland og Unemployment in Helgeland Helgeland and in Nordland is slightly lower than Norway overall. 3.50% 3.10% 2.70% 2.30% 1.90% 1.50% Norge Nordland Helgeland 10 En drivkraft for vekst på Helgeland
Slide 11: Helgeland
Helgeland Aquaculture – High export value and Helgeland is the engine in northern Norway – Great investment will – Good results from production with large smolt Power – Helgeland Kraft 15 power plants in the region – 3 of Statkraft’s 5 largest magazines lies on Helgeland (7TWh) – Total power product
Slide 12: Helgeland
Helgeland Contraction – Large contraction activity on the E6 through the whole region – Brønnøysundregistret – new building – Airport – Total planned investments in Helgeland the next 7 years, 70-80 bn NOK Tourism – Increased tourism – Past Lofoten in number of hotel stays – Better infrastructure an
Slide 13: Helgeland
Helgeland Industry – Norway's second largest industrial cluster – High quality, high efficiency – Focus on circular economy – Great export value Retail market – Decrease in number of employees – Increased number of emigrants in the age 30-45 – Relatively larger number of elders in the population tha
Slide 14: Profit & loss
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 14 En drivkraft for vekst på Helgeland
Slide 15: Result
Result Change gross profit so far this year Good result 600 -41 -74 Gross profit MNOK 348 500 45 1 -4 • ROE of 8.6 % -30 400 • Adjusted for one-time effect pension (MNOK 74) and gains 300 from Visa (MNOK 14.5) gross 452 profit per 31.12.16 was MNOK 364 200 348 100 Decrease in financial investments i
Slide 16: Profit
Profit Good result Q4 Profit developement (MNOK) Gross profit MNOK 348 500 452 40% • ROE after tax 8.6 % 35% 85 • One time effect pension MNOK 400 348 74 in Q1 2016 30% 283 280 300 266 107 72 25% 49 20% 73 92 101 200 88 106 15% 76 59 91 10% 80 74 8,6% 100 58 66 5% 51 66 71 80 84 0 0% 2013 2014 2015
Slide 17: Net interest
Net interest Development net intr.(mnok.) and % of average BTA Maintained net interest over time 200 • Still strong competition regarding price • Lower lending costs with falling 147 150 134 135 141 142 Nibor and lower credit spreads 133 1.85% 1.82% 1.83% 1.86% 1.84% 1.84% 100 50 0 Q3/2016 Q4/2016 Q
Slide 18: Operating costs
Operating costs Operating cost (mnok) and % of income Costs in % of income • Closing offices Q2 and Q3 2017 100 • One time effect pension Q3 2017 last CEO • New finance tax 2017 75 72 71 69 68 67 65 (one-time effect pension is not included in the figure) 50 • Costs in % of income so far this year 40
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: Lending
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 20 En drivkraft for vekst på Helgeland
Slide 21: Credit growth
Credit growth 12-month credit growth Credit growth 20% • 12-month growth 7.5 (9.8)% Locally in Helgeland 15% • Per Q4 83.8 (84.0)% 10% PM share 7.5 % • Target minimum 60% 5% 6.3 % • Per Q4 66.4 (67.6)% 0% -5% 2013 2014 2015 2016 2017 HSB Helgeland total Statistic Norway total 21 En drivkraft for vek
Slide 22: Credit growth CM
Credit growth CM 12-month credit growth corporate market 20% 12 month growth CM 11.7 (10.9) % 15% 11.7 % 10% 6.4 % 5% 0% -5% 2013 2014 2015 2016 2017 HSB Helgeland corp. Statistic Norway corp. 22 En drivkraft for vekst på Helgeland
Slide 23: Credit growth RM
Credit growth RM 12-month credit growth retail market 20% 12 month growth RM 5.5 (9.3) % 15% • The bank’s market shares are stable 10% 6.5 % 5% 5.5 % 0% -5% 2013 2014 2015 2016 2017 HSB Helgeland pers. Statistic Norway pers. 23 En drivkraft for vekst på Helgeland
Slide 24: Lending CM
Lending CM Lending distributed in sector Good diversification in the CM lending portfolio and loyal 12.5 % corporate customers Real estate 12.1 % Share CM of total lending 33.6 5.4 % (32.4)% or MNOK 8 951 Farming and forestry 5.3 % (8 013) 4.5 % Construction and power 5.4 % 3.6 % Transport and servi
Slide 25: Non-performing and other impaired commitments
Non-performing and other impaired commitments Net defaulted and com. exp. to loss 400 Net non-performing and other 350 impaired commitments amounts to 300 MNOK 183 (113), 0.7 (0.5)% of gross 250 loans 200 Effect of IFRS 9 increases write- 150 downs on lending in the balance 100 01.01.18 by MNOK 4. M
Slide 26: Deposits
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 26 En drivkraft for vekst på Helgeland
Slide 27: Deposit growth
Deposit growth Commentary 12-month deposit growth 20% 12-month growth 4.9 (12.2)% RM share 15% • Per Q4 55.7 (56.3)% 10% Locally in Helgeland 6.6 % •Per Q4 90.2 (91.0)% 5% 4.9 % Deposit ratio 0% • Target minimum 60% • Per Q4 63.8 (65.4)% -5% 2013 2014 2015 2016 2017 HSB total Helgeland Statistic tot
Slide 28: Deposit growth CM
Deposit growth CM 12-month deposit growth corporate market 12-month growth CM 6.3 (21.2)% 35% 30% 25% 20% 15% 10% 8.4 % 5% 6.3 % 0% -5% -10% 2013 2014 2015 2016 2017 HSB Helgeland Corp. Statistic Norway Corp. 28 En drivkraft for vekst på Helgeland
Slide 29: Deposit growth RM
Deposit growth RM 12-month deposit growth retail market 12-month growth RM 3.9 (6.1)% 20% 15% 10% 5% 4.4 % 3.9 % 0% -5% 2013 2014 2015 2016 2017 HSB Helgeland pers. Statistic Norway pers. 29 En drivkraft for vekst på Helgeland
Slide 30: Deposits CM
Deposits CM Customer deposits Well diversified deposit portfolio in the CM 10.9 % Municipalities 10.8 % Share CM 44.3 (43.7)% or 7.9 % Farming and forestry 6.7 % MNOK 7 516 (7 069) of total 8.6 % deposits Transport and services 10.1 % Construction and power 6.0 % Deposits from municipalities 6.6 % c
Slide 31: Deposit development
Deposit development 100 % 18 000 000 000 90 % 17 000 000 000 80 % 70 % 16 000 000 000 60 % 15 000 000 000 50 % 40 % 14 000 000 000 30 % 13 000 000 000 20 % 10 % 12 000 000 000 0% jan. 16 11 000 000 000 jan. 14 jan. 15 jan. 17 jul. 15 jul. 16 jul. 17 okt. 13 apr. 14 jul. 14 okt. 14 apr. 15 okt. 15 ap
Slide 32: Funding
Main features Helgeland Profit & Loss Lending Deposits Funding Solidity Prospects and priorities Appendices 32 En drivkraft for vekst på Helgeland
Slide 33: Funding
Funding Funding development (MNOK) Deposits are the most important source for funding. 120% 100% 2.2 % 2.2 % 2.1 % 2.8 % 2.1 % 13.5 % 15.0 % 14.3 % 17.5 % 19.3 % 80% 26.8 % 25.9 % 24.4 % 19.2 % 18.7 % 60% 40% 54.8 % 56.9 % 59.2 % 60.5 % 59.9 % 20% 0% 2013 2014 2015 2016 2017 Deposits Swap agreement
Slide 34: Funding
Funding Good and long term funding Maturity of loans (MNOK) Share long term funding 3 000 87.8% (88.2)% 2 500 Combined duration of 2.9 (2.8) years. Duration in the 2 000 1 000 mortgage company 3.2 years 1 400 1 500 1 000 1 500 70 1 000 1 500 500 1 051 1 000 1 000 500 750 200 0 2018 2019 2020 2021 20
Slide 35: Helgeland Boligkreditt AS
Helgeland Boligkreditt AS Helgeland boligkreditt AS, fully owned by Helgeland Sparebank • Net profit MNOK 48.9 (33.1). • CET1 ratio of 19.9 (17.1)% • standard method with 35% mortgage weights • Gross loans amounts to MNOK 6 634 (5 629) and CB MNOK 5 476 (4 523) Good security in the lending portfolio
Slide 36: Solidity
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 36 En drivkraft for vekst på Helgeland
Slide 37: Liquidity buffer
Liquidity buffer Sector distribution interest portfolio 41% CB 1 32% Interest bearing securities: Finance, Norway 1% 7% • Duration portfolio 2.0 (2.0) years • 97 % rated A- or better Government 12% 16% • 95 % CB or state-/ municipal guaranteed bonds 28% Municipalites 48% Municipality papers are acti
Slide 38: Capital adequacy
Capital adequacy Capital ratio Development capital adequacy • CET1 15.8 (16.1)% 22% • Core capital 17.4 (18.7)% • Total capital 19.1 (20.5)% 20% 1.8 % The Group’s capital targets included 18% 1.7 % Pilar 2 addition of 2.2% amounts to 2.6 % 14.2% per 31.12.17 1.6 % 16% New target CET1 15.0% 14% Lever
Slide 39: Proposed disposal of profit 2017
Proposed disposal of profit 2017 Commentary Allocation of profit 2017 Increased distribution ratio 155 150 • 50.0 (41.9)%. 135 Dividend basis is MNOK 218 • The parent bank’s result is 115 adjusted for unrealized gains and 100 95 86 interests perpetual bonds 84 84 78 75 The board proposes dividend fo
Slide 40: HELG – the largest owners
HELG – the 20 largest owners Parent bank Per 31.12.17 Numbers % share Numbers % share Sparebankstiftelsen Helgeland 7 255 020 34.8 % Vigner Olaisen AS 294 653 1.4 % Pareto AS 1 949 392 9.3 % Catilina invest AS 256 046 1.2 % VPF Nordea Norge 1 407 987 6.7 % VPF Nordea 244 270 1.2 % Merrill Lynch Prof
Slide 41: HELG – the largest local owners
HELG – the 20 largest local owners Per 31.12.17 Numbers % Number % Sparebankstiftelsen Helgeland 7 255 020 34.8 % Torghatten ASA 16 824 0.08 % Helgeland Kraft AS 377 691 1.8 % Harald Svendsen 13 710 0.07 % Vigner Olaisen AS 294 653 1.4 % Dan Erik Kjellnø 13 000 0.06 % Steffen Nervik 110 506 0.5 % Sn
Slide 42: HELG – EC development and liquidity
HELG – EC development and liquidity 2015 2016 2017 EC fraction 75.1 % 75.1 % 76.5 % Number of EC's 18.7 20.9 20.9 Stock exchange price 59.0 81.0 88.0 Stock value 1 103.3 1 692.9 1 839.2 Accounted equity per EC 93.7 101 109.5 Profit per EC 8.4 13.5 9.5 Dividend per EC 2.75 3.75 4.00 Price/Accounted E
Slide 43: Prospects and priorities
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 43 En drivkraft for vekst på Helgeland
Slide 44: Prospects and priorities
Prospects and priorities Prospects – Increased profitable growth in the Retail market – Maintain market position and profitability in the corporate market and be a driving force for growth – Streamline and automate support functions 44 En drivkraft for vekst på Helgeland
Slide 45: Appendices
Main features Helgeland Profit & loss Lending Deposits Funding Solidity Prospects and priorities Appendices 45 En drivkraft for vekst på Helgeland
Slide 46: Profit & loss
Profit & loss Helgeland Sparebank (group) Q2/2016 Q3/2016 Q4/2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Net interest- and credit provision earnings 128 133 134 135 141 142 147 Net provision earnings 22 22 21 20 22 21 23 Other operatios income 1 1 2 1 1 0 2 Ordinary operations cost 69 65 72 69 68 71 67 Res
Slide 47: Key figures
Key figures Keyfigures in % of average BTA Stable net interest 2.5 % • 1.83% per 31.12.17 Net provisions 1.83% • Reduced from 0.30% 31.12.16 to 0.28% 1.5 % Operating costs 0.89% • Reduced from 0.96% per 31.12.16 to 0.89% 0.5 % 0.28% 0.21% 0.11% -0.5 % 2013 2014 2015 2016 2017 Net interest Net provis
Slide 48: Balance
Balance Helgeland Sparebank (group) 31.12.17 31.12.16 Change liquid assets 551 602 -51 Net lending to customers 26 453 24 632 1 821 Certificates and shares 4 518 3 851 667 Other assets 328 298 30 Assets 31 850 29 383 2 467 Deposits from customers 16 972 16 173 799 Money market financing 10 851 9 258
Slide 49: 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 50: 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 51: Contact information
Contact information Head office Board of directors Postal address Postboks 68, 8601 Mo i Rana Ove Brattbakk, leder Visiting address Jernbanegata 15, 8622 Mo i Rana Stein Andre Herigstad-Olsen, nestleder Eva Monica Hestvik Phone number 75 11 90 00 Bjørn Audun Risøy Web www.hsb.no Inga Marie Lund Orga