Sparebank 1 Ostlandet · OSL:SPOL
Sparebank 1 Ostlandet — SpareBank 1 SR-Bank — Q3 2012 Earnings Presentation
42 slides from Sparebank 1 Ostlandet's earnings presentation, Nov 1, 2012
Slide 1: 3rd quarter 2012
SpareBank 1 SR-Bank ASA 3rd quarter 2012 1st November 2012 Page 1
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements that reflect management’s current views with respect to certain future events and potential financial performance. Although SpareBank 1 SR-Bank believes that the expectations reflected in such forward-looking statements are reasonable,
Slide 3: Highlights
Highlights Year-to-date pre-tax profit was NOK 1,303 million (NOK 1,005 million) – Return on equity after tax of 12.8 % (10.4 %) Pre-tax profit for the third quarter was NOK 505 million (NOK 253 million) – Return on equity after tax of 13.6 % (7.2 %) Growth in loans of 8.5 % and growth in depo
Slide 4: Key figures
Key figures Return on equity Core capital ratio 13,9 % 13,6 % 12,9 % 11,8 % 11,4 % 11,5 % 10,6 % 10,5 % 9,6 % 7,2 % Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Deposit-to-loan Earnings per share in NOK 66,8 % 67,6 % 1,73 66,2 % 61,9 % 63,2 % 1,58 1,56 1,19 0,86 Q3 11 Q4 11 Q1 12 Q2 1
Slide 5: Outlook
Outlook High level of investment in the oil, gas and energy sector - expect continued low unemployment and increasing housing construction in the group's market area. However persistent international uncertainty may potentially have negative consequences for the Norwegian economy as well. Good
Slide 6: Income statement
Income statement 30.09 30.09 Group Income Statement (MNOK) 12 11 Q3 12 Q2 12 Q1 12 Q4 11 Q3 11 Net interest income 1.262 1.308 448 413 401 448 457 Net commission and other income 1.055 887 374 379 302 305 281 Net income on investment securities 481 208 192 87 202 111 7 Total income 2.798 2.403 1.014
Slide 7: Key figures
Key figures 30.09 30.09 12 11 Q3 12 Q2 12 Q1 12 Q4 11 Q3 11 Return on equity after tax (%) 12,8 10,4 13,6 11,8 12,9 13,9 7,2 Net interest margin (%) 1,24 1,30 1,28 1,22 1,21 1,34 1,35 Impairment losses on loans and guarantees in % of gross loans 0,14 0,12 0,16 0,13 0,13 0,18 0,11 -incl. SB1 Boligkre
Slide 8: The group’s income profile
The group’s income profile 900 800 700 286 295 259 291 256 600 34 500 32 11 41 88 7 MNOK 22 14 84 46 400 300 457 448 448 200 401 413 100 0 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Net interest income Commission income SB1 Boligkreditt and SB1 Næringskreditt Profit before tax SB1 Boligkreditt and SB1 Næringskre
Slide 9: Lending and deposit margins
Lending and deposit margins Lending margins 2,29% 2,34% 2,14% 1,94% 1,97% 1,98% 2,01% 2,00% 1,97% 1,65% 1,71% 1,39% 1,22% 1,26% 1,19% 1,06% 1,02% 0,99% Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Corporate market Retail market Deposit margins 0,65% 0,69% 0,63% 0,59% 0,56% 0,50% 0,27% 0,24%
Slide 10: Lending volume and 12 months growth
Lending volum and 12 months growth Corporate Market 50 000 12,1 % 15% 11,1 % 11,8 % 40 000 8,9 % 7,2 % 10% 4,8 % 5,7 % 30 000 MNOK 2,9 % 5% 20 000 0,3 % 0% 10 000 0 -5% Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Volume Growth % Retail Market 120 000 16,9 % 17,1 % 17,2 % 17,1 % 100 000 12,
Slide 11: Loan portfolio as at 30.09.2012
Loan portfolio as at 30.09.2012 Industry, Power/water supply and construction: 3,7 (3,9) Agriculture / forestry / fishing: 2,9 (2,8) Retail trade, hotels and restaurants: 1,9 (2) Shipping : 1,1 (1,3) Offshore: 4,8 (5,0) Retail customers: 30,5 (35,4) Real estate: 15,5 (16,6) Total retail customer: 63
Slide 12: Loan to value ratio on home mortgage loans
Loan to value ratio on home mortgage loans Loan to value ratio – home mortgage loans - total- • There is an increasing proportion of distributed loans within a 70 % loan to value ratio 80% 73,0 % 68,1 % during the last year and a diminishing proportion of loans that have a loan to 60% value ratio ex
Slide 13: Deposits volume and 12 month growth
Deposits volume and 12 month growth Corporate Market 20,1 % 19,5 % 40 000 20% 16,0 % 30 000 13,3 % 15% MNOK 20 000 6,8 % 5,9 % 10% 3,3 % 3,0 % 2,8 % 10 000 5% 0 0% Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Volume Growth % Retail Market 40 000 20% 15,1 % 13,6 % 13,9 % 13,7 % 30 000 15% 11
Slide 14: Net commission and other income
Net commission and other income 30.09 30.09 MNOK 12 11 Q3 12 Q2 12 Q1 12 Q4 11 Q3 11 Payment facilities 158 152 61 50 47 52 53 Savings/placements 104 106 33 36 35 34 29 Insurance products 105 101 36 35 34 53 34 Commission income real estate (EM1) 328 320 105 124 99 106 102 Guarantee commission 68 58
Slide 15: Net income on investment securities
Net income on investment securities 30.09 30.09 MNOK 12 11 Q3 12 Q2 12 Q1 12 Q4 11 Q3 11 Dividend 25 20 1 21 3 1 1 Investment income, associates 243 142 90 53 100 67 33 Securities gains/losses 107 -53 62 -23 68 5 -34 - of which capital change in shares and certificates 15 -43 35 -34 14 8 -38 - of wh
Slide 16: Subsidiaries
Subsidiaries MNOK 30.09.12 30.09.11 EiendomsMegler 1 SR-Eiendom AS Number of sales 5.694 5.679 Operating profit before tax 81,7 48,4 SpareBank 1 SR-Finans AS Total assets (BNOK) 6,0 5,2 Operating profit before tax 77,3 56,8 SR-Forvaltning AS Portfolio (BNOK) 6,2 5,8 Operating profit before tax 16,4
Slide 17: Ownership interests
Ownership interests MNOK 30.09.12 30.09.11 SpareBank 1 Gruppen AS (19,5 % interest ownership) Profit after tax 95,7 46,8 Adjusted profit contribution from 2011 9,3 1,9 SpareBank 1 Boligkreditt AS (34,4 % interest ownership) Profit after tax 70,3 21,3 SpareBank 1 Næringskreditt AS (30,7 % interest ow
Slide 18: Operating expenses
Operating expenses 30.09 30.09 MNOK 12 12 Q3 12 Q2 12 Q1 12 Q4 11 Q3 11 Personnel expenses 831 785 277 279 275 267 273 Non-recurring effect, pension-related items -41 -57 -6 -35 0 -167 0 Total personnel expenses 790 728 271 244 275 100 273 IT expenses 168 161 62 49 58 61 54 Marketing 58 61 16 21 21
Slide 19: Impairment losses on loans and guarantees
Impairment losses on loans and guarantees 30.09 30.09 Losses on loans in income statement (MNOK) 12 11 Q3 12 Q2 12 Q1 12 Q4 11 Q3 11 Corporate customers 133 89 44 24 65 -11 14 Retail customers 8 23 -1 10 -1 35 3 Change in collective impairment losses on loans -30 -18 0 0 -30 21 13 Net impairment los
Slide 20: Impairment losses on loans
Impairment losses on loans 0,45 0,41 550 0,40 0,38 0,38 0,35 450 0,32 0,30 350 0,25 98 91 Percentage 0,23 MNOK 0,20 250 0,19 24 0,15 0,13 0,14 150 0,10 288 277 5 0,10 0,10 210 141 0,05 134 50 0,00 -30 -50 -0,05 2008 2009 2010 2011 30.09.12 Individual impairment losses on loans Collective impairment
Slide 21: Non-performing and doubtful commitments
Non-performing and doubtful commitments 1,61% 1,33% 1,41% 1,44% 1,25% 1,31% 1,23% 1,14% 1,10% 1,10% 0,97% 0,90% 0,90% 0,94% 0,91% 0,90% 0,76% 0,76% 909 1.264 708 860 897 762 753 696 696 590 564 517 395 443 415 415 444 348 2008 2009 2010 2011 30.09.2011 31.12.2011 31.03.2012 30.06.2012 30.09.2012 Non
Slide 22: Market financing and liquidity management
Market financing and liquidity management Funding maturity over the next 12 months • Very favourable liquidity and good 4,0 access to the market. 3,0 BNOK 2,0 • Issued approximately NOK 11.4 billion 1,0 and bought back about NOK 4.9 billion in 0,0 the year to date. aug. 13 nov. 12 mar. 13 jun. 13 se
Slide 23: Solvency
Solvency • At the end of the Q3 2012 the Tier 1 capital 14 13,4 coverage was 11.5 %. 12,8 12,9 12,0 11,9 12,0 12 11,2 11,4 11,5 • At the end of the Q3 2012, Core Tier 1 10,3 10,6 10,5 capital coverage was 9.4 %. 10 9,6 9,4 9,3 8,8 8,2 8,3 Percentage • SpareBank 1 SR-Bank's aim is to have a Tier 1 8
Slide 24: Appendix
APPENDIX Page 24
Slide 25: SRBANK as at 30 September 2012
SRBANK as at 30 September 2012 30.09.12 2011 2010 2009 2008 • Ownership interests: –From Rogaland, Agder-counties and Hordaland: 61,5 % Market price 36,90 40,70 57,00 50,00 27,08 –International: 6,2 % –10 largest: 55,3 % –20 largest: 60,3 % Stock value (MNOK) 9.437 5.182 7.257 6.047 2.434 • Number o
Slide 26: 20 largest shareholders as at 30 September 2012
20 largest shareholders as at 30 September 2012 # Investor Number Stake 1 Sparebankstiftelsen SR-Bank 79.735.551 31,2 % 2 Gjensidige Forsikring ASA 26.483.470 10,4 % 3 SpareBank 1-stiftinga Kvinnherad 6.226.583 2,4 % 4 Folketrygdfondet 6.117.293 2,4 % 5 Odin Norge 5.507.410 2,2 % 6 Frank Mohn AS 5.3
Slide 27: Rating
Rating Moody’s Fitch Long-term debt A1 Long-term IDR A- Outlook On review Outlook Stable Outlook Updated 9th march 2012 Updated 24th february 2012 Ratinghistory AAA/Aaa AA+/Aa1 AA/Aa2 AA-/Aa3 A+/A1 Moody's A/A2 A-/A3 Fitch BBB/Baa BB/Ba B 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 P
Slide 28: Savings/placements – portfolio development
Savings/placements – portfolio development 14000 • Assets under management of NOK 11,9 billion as at 30 September 2012 — Increased from NOK 11,2 billion as at 12000 31 december 2011 — 51 977 active savings contracts - NOK 43,0 million in monthly savings 10000 • Most of the assets are managed by 8000
Slide 29: Liquidity buffer and bond portfolio
Liquidity buffer and bond portfolio Liquidity buffer – survival period Bond portfolio 22 20 Of which, 18 securities 16 classified to Bond investments Market value Share amortised cost BNOK 14 Norwegian state/municipal 3.551 25 % 0 12 Foreign guaranteed/SSA 2.318 16 % 0 10 Covered bonds 6.877 48 % 0
Slide 30: Securities investments
Securities investments Risk profile - bonds • Most of the bond portfolio is managed as part of the bank's liquidity management Total portfolio activities. Bonds held for liquidity Market value Per cent Risk category Rating NOK million Total purposes are generally very low risk. Gov't swap scheme AAA
Slide 31: Low exposure to the shipping segment
Low exposure to the shipping segment • Lending to conventional shipping is low and represents 1.1 % of total loans Dry cargo; 3,8 % Gas; 3,2 % Other; 5,8 % Product tanks; • Lending to the offshore sector 7,9 % represents 4.8 % of total loans Seismic; 6,5 % • Lending, undrawn credit limits and guaran
Slide 32: Lending to property management
Lending to property management • Lending to property management Housing constitutes 15.5 % of total loans, which cooperative; 5,8 % is a reduction of 1.1 % per cent Real estate compared with the same time last year. management; 2,2 % • The portfolio is characterised by lending Development and to com
Slide 33: Risk profile of the loan portfolio
Risk profile of the loan portfolio Loan portfolio distributed by risk group • 92.6 % of the bank's loan exposure 100% 92,6 % 91,7 % satisfies the criteria for low and the lowest risk. Expected losses* in this 80% portion of the portfolio are very limited 60% at 0.04 %. 40% • Exposure to high or the
Slide 34: The loan portfolio has a low concentration of large individual commitments
The loan portfolio has a low concentration of large individual commitments Loan portfolio distributed by loss given realisation (LGR) • At the end of the third quarter of 2012, 100% SpareBank 1 SR-Bank has 26 loans with a loss potential exceeding NOK 100 million 90% 84,5 % if realised. 82,5 % 80% •
Slide 35: Risk profile – Lending in the corporate market
Risk profile – Lending in the corporate market Development in corporate market’s portfolio distributed by risk group • The quality of the corporate market portfolio is considered to be good. 100% 4,6 % 4,6 % 3,9 % 3,7 % 3,7 % 15,1 % 17,0 % 16,8 % 18,7 % 16,1 % 80% • The risk profile has seen a relat
Slide 36: Risk profile – Lending in the corporate market
Risk profile – Lending in the corporate market Lending to commercial property for leasing distributed by • The portfolio of commercial property for risk group leasing represents the group's largest concentration in a single sector and accounts 100% 3,8 % 3,5 % 2,1 % 2,9 % 2,6 % for around 10 % of th
Slide 37: Risk profile – Lending in the retail market
Risk profile – Lending in the retail market Retail market portfolio distributed by risk group • The quality of the retail market 0,6 % 0,3 % 0,3 % 0,2 % 0,2 % portfolio is considered very good and 100% 1,6 % 1,0 % 1,0 % 0,9 % 0,8 % with low potential losses. 80% 60% • The development is characterise
Slide 38: Balance sheet
Balance sheet Balance sheet (MNOK) 30.09.2012 30.09.2012 Cash and balances with central banks 224 249 Balances with credit institutions 481 1.175 Net loans to customers 103.671 103.174 Certificates, bonds and other fixed-income securities 22.156 18.265 Financial derivatives 4.769 4.267 Shares, owner
Slide 39: SRBANK’s activities
SRBANK’s activities Divisions of SpareBank 1 SR- Capital Markets Retail Market Corporate Market Administration & Support Bank ASA Number of man-years: 39 Number of man-years : 531 Number of man-years : 181 Number of man-years : 210 Fully owned companies Number of man-years : 217 Number of man-years
Slide 40: SpareBank 1 Alliance
SpareBank 1 Alliance Owners of the Sparebanken alliance Samspar Samspar Hedmark • All credit decisions are made at the 19.5 % 19.5 % 19.5 % 19.5 % 12.0 % 10.0 % local banks • Economies of scale related to expenses, Products, commissions, dividends IT solutions, marketing and branding Sales, loan por
Slide 41: Our vision: Recommended by customers
Our vision: Recommended by customers Primary objective Financial targets • SpareBank 1 SR-Bank ASA is commited to value • ROE 13-15 % in a normalized market creation in the bank`s core market area • Sustainable contribution to the value creation process • Top 50 % ROE and cost/income in a Nordic ben
Slide 42: Contact Details
Contact Details Address Management Investor Relations Arne Austreid Vidar Torsøe Bjergsted Terrasse 1 CEO Investor Relations Postboks 250 4066 Stavanger Tel. Tel. +47 900 77 334 +47 970 80 656 Tel. E-mail. E-mail. arne.austreid@sr-bank,no vidar.torsoe@sr-bank.no +47 915 02002 Inge Reinertsen www.sr-