Swedbank Ab Class A · OMXSTO:SWED_A

Swedbank Ab Class A — Q1 2019 Earnings Presentation

20 slides from Swedbank Ab Class A's earnings presentation, 2019

  1. Slide 1: Swedbank's first quarter results 2019

    Swedbank’s first quarter results 2019 ​Anders Karlsson (acting CEO), Helo Meigas (CRO), Gregori Karamouzis (Head of IR) © Swedbank Information class Public

  2. Slide 2: Strong Q1 result

    Strong Q1 result  Higher net interest income Total income, SEKbn TOTAL 12  Seasonally affected net commission INCOME SEK 11.4bn 8 4 income 0  NGL benefited from improved market Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 condition Total expenses, SEKbn 6 TOTAL  Expenses higher mainly due to EXPENSES

  3. Slide 3: Higher net interest income

    Group result Higher net interest income NII, SEKm • Continued loan volume growth 101 7 6 335 44 58 6 421 • Higher deposit margins -79 -46 • Lower mortgage margins • Lower resolution fund fee in 2019 • Two fewer days in the quarter Q4 2018 Loan Margins Resolution FX Day count Treasury & Q1 2019 volum

  4. Slide 4: Seasonally affected net commission income

    Group result Seasonally affected net commission income NCI, SEKm • Seasonally lower income in – Cards 3 183 -22 -47 -6 3 070 – Asset management -39 – Brokerage – Custody • Asset management income Q4 2018 Cards & Payments Asset Lending & management guarantees Other Q1 2019 supported by positive marke

  5. Slide 5: Improved market conditions

    Group result Improved market conditions NGL, SEKm 1 186 • Higher fixed income trading activity • Positive valuation effects from FX 635 and tighter credit spreads 559 488 430 • Visa and Asiakastieto share price appreciation Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Other Income, SEKm • Lower income fr

  6. Slide 6: Strong capitalisation

    Capital Strong capitalisation CET1 capital ratio, % • CET1 capital increased by SEK 0.8bn 16.4% 16.3% 15.9% – Positive effect from net profit of 14.6% SEK 1.5bn excl. dividend – Negative IAS19 pension valuation effect of SEK 0.7bn • REA increased by SEK 18.5bn Q3 2018 Q4 2018 Q1 2019 CET1 capital Pr

  7. Slide 7: Increased Risk Exposure Amount (REA)

    Capital Increased Risk Exposure Amount (REA) REA, SEKbn • REA increased by SEK 18.5bn – IFRS 16 increased credit risk by 8.8 3.1 3.7 1.4 1.4 656.4 SEK 4.2bn 637.9 – Higher market exposures – Annual update increased operational risk due to higher income Q4 2018 Credit risk Market risk Operational Swe

  8. Slide 8: Strong result

    Group result Strong result SEKm Q1 19 Q4 18 ▲QoQ • Continued loan volume growth Net interest income 6 421 6 335 86 • Seasonally affected net Net commission income 3 070 3 183 -113 commission income Net gains and losses 1 186 430 756 Other income 685 784 -99 • Net gains and losses boosted by Total in

  9. Slide 9: Strong liquidity position

    Strong liquidity position Survival horizon Stable liquidity key ratios SEKbn 800 more than 12 months 112 Net Stable Funding Ratio and Liquidity coverage ratio, % 180 • Solid liquidity buffer – prefunded for NSFR (LHS) LCR 110 170 more than 12 months (survival 600 160 108 150 horizon) • Term funding

  10. Slide 10: Market-leading cost efficiency remains a key priority

    Market-leading cost efficiency remains a key priority FY 2019 expenses estimate AML-related initiatives Investments • Ongoing legal & consultancy fees • Re-prioritisation of customer- ~0.1bn Other business one-offs − SEK 78m incurred in Q1 focused initiatives ~0.25bn Investments • CEO severance pay

  11. Slide 11: Solid asset quality

    Group Solid asset quality Credit impairments, SEKm Q1 19 Q4 18 ▲QoQ • Resilient asset quality in all Swedish Banking 141 190 -49 business segments Baltic Banking -29 -103 74 Large Corporates & Institutions 107 331 -224 Swedbank Group 218 412 -194 Ratios Q1 19 Q4 18 Credit impairment ratio, % 0.05 0.

  12. Slide 12: Appendix

    Appendix © Swedbank Information class Public

  13. Slide 13: Continued volume growth

    Continued volume growth Loans Deposits +13bn 0bn ** +3bn +4bn +6bn -4bn +4bn Swedish Baltic Banking Corporate excl. Private Corporate private loans* Baltic Banking Of which FX +2 Of which FX +3 Of which FX +3 * Private mortgage loans, private other including tenant-owner associations **excl. Group f

  14. Slide 14: Swedbank – low-risk bank with strong capital

    Swedbank – low-risk bank with strong capital This is Swedbank base Liquidity & capital, % • Low risk – a Board of Directors’ strategic priority – ensures access to funding NSFR LCR CET1 ratio,(RHS) markets and low funding cost 200 30 • Retail profile and four home markets a key feature 25 150 20 – A

  15. Slide 15: Swedbank – strong and stable earnings

    Swedbank – strong and stable earnings This is Swedbank capacity • Four home markets – Sweden, Estonia, Latvia and Lithuania – Strong and stable economies – Market-leading position in all home markets – Largest customer base in all home markets Profit before impairments, SEKbn • Retail profile ensure

  16. Slide 16: Swedbank – market leader in cost efficiency

    Swedbank – market leader in cost efficiency This is Swedbank Total expenses, SEKbn • Best-in-class cost efficiency – an executive management strategic priority 18 Acquisition, one-off 16 • Executive management strongly focused on cost and change management 14 12 – Integrated in corporate culture 10

  17. Slide 17: Swedbank has a low-risk real estate portfolio

    Swedbank has a low-risk real estate portfolio Swedbank real estate exposures Real estate lending, net loans in Sweden, SEKbn1) • Swedbank has pursued a low risk 1 131 • Private mortgages: SEK 803bn, average strategy by tightening origination LTV 57% • Tenant owner associations (“TOA”): SEK standards

  18. Slide 18: Residential property developers - well-known customers

    Residential property developers - well-known Swedbank real estate exposures customers • Total loan portfolio of SEK 15bn, mainly to the larger listed construction firms, with which Swedbank has long-term relations − Approximately SEK 9bn of the loans are related to tenant owner association projects

  19. Slide 19: Focus on sustainable business

    Focus on sustainable business Q1 accomplishments Landmark achievements in 2018 Anchor investor in a blue bond Swedbank Robur launches unique SDG equity fund Baltic Blue Swedbank Robur was the anchor investor when the Nordic Swedbank Robur’s new sustainability equity fund, Global Impact, invests in c

  20. Slide 20: Real-estate price performance – Sweden

    Swedish Real-estate price performance – Sweden, housing and mortgage 12 month market Single-family homes1 Tenant-owner rights2 Combined3 12M Δ 12M Δ 12M Δ Apr 18 -2% -7% -4% May 18 -2% -7% -4% Jun 18 -2% -7% -4% Jul 18 -3% -7% -5% Aug 18 -3% -7% -5% House price index, Sweden 350 2005=100 Sep 18 -3%

Swedbank — Q1 2019 Earnings Presentation on 6ix