Nordea Bank Abp · OMXHEX:NDA_FI
Nordea Bank Abp — Nordea — Q1 2023 Earnings Presentation
23 slides from Nordea Bank Abp's earnings presentation, 2023
Slide 1: First-quarter results 2023
First-quarter re
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 Nordea believes that the expectations reflected in such forward-looking statements are reasonable, no assurance
Slide 3: First-quarter highlights 2023
First-quarter highlights 2023 Executive summary Strong profitability in slower market - Net interest income up 35%, net fee and commission income down 8% and net fair value result up 27% - Operating profit up 34% to EUR 1,480m Business volume growth driven by corporate lending - Corporate lending up
Slide 4: Key financials
Key financials First-quarter results 2023 income statement and key ratios Q123 Q122* Q1yai Q422 Q1/a4 Net interest income 1,765 1,308 35% 1,641 8% Net fee and commission income 765 829 -8% 785 -3% Net insurance result 46 35 31% 47 -2% Net fair value result 345 272 27% 396 -13% Other income 0 7 28 To
Slide 5: Net interest income
Net interest income Slowing volume growth, increased deposit margins Year-over-year bridge, EURm y 66000 90 1,765 418 1308) <a Ze —— i Q122 Volumes Margins Other FX Q123 Quarter-over-quarter bridge, EURm 33 60 1,765 156 1,641 Be. Q422 Volumes Margins Other FX Q123 Net interest income up 35% Lending
Slide 6: Net fee and commission income
Net fee and commission income Higher payment and card income partly offsetting lower asset management income Year-over-year bridge, EURm , 829 4 — ao 0 120. 12 6 165 — I i? Q122 Asset Brok.& Pay.& Lending Other FX Q123 mgmt. advisory cards Quarter-over-quarter bridge, EURm 785 a 6 oT 14 QR —— "765 a
Slide 7: Net fair value result
Net fair value result High customer activity Net fair value result, EURm r +27% y * Continued high customer risk 396 | management activity 345 - Strong demand for FX and rate 118 hedging products mm = 5 254 238 ” + Market-making up, driven by . rates and FX trading “12 “14 Q122 Q222 Q322 0422 Q123 H
Slide 8: Costs
Costs Continued additional investments Year-over-year bridge, EURm & 1 * Costs excluding regulatory fees _ 53 La —-— parr 4,422 up 6%, in line with plan 1370 0 57 —— * Continued additional ———— ma investments in selected strategic reas: digi , r Q122 Underlying Additional IT Regulatory fees FX Q123
Slide 9: Net loan losses and similar net result
Net loan losses and similar net result Strong credit quality in weaker economic conditions Net loan losses and similar net result Q1 2023, EURm = - Individual Collective Net loan losses Nordea Kredit Total provisions provisions (net) fair value adj. and write-offs Impaired (stage 3) loans and PD of
Slide 10: Capital
Capital Strong position; share buy-backs continuing CET1 capital ratio development, % 0.8 -0.6 ; i f -07 16.4 | -0.2 -01 15.7 15-2.0 \ A a Q422 Profit Dividend Share IFRS 17 Other Q123 Requirement accrual buy-backs Capital policy buffer I CET1 requirement REA development, EURbn 154 151 149 145 142 Q
Slide 11: Personal Banking
Personal Banking Higher net interest income, driven by higher deposit income and lending volumes Total income, EURm * Total income up 22% 960 1076 1115 + Mortgage volumes up 1% — margin pressure continuing on 891 * Deposit volumes up 2% and margins increased 764 81 . . . ES aril 5 + Lower savings &
Slide 12: Business Banking
Business Banking Strong business momentum with continued volume growth Total income, EURm —-p- ~ + Total income up 20% 821 842 703 700 726 * Lending volumes up 4%, led by Sweden and Norway 438 439 481 556 oi * Deposits up 3% + Strong credit quality — net loan losses of 2bp 106 101 100 103 106 + Impr
Slide 13: Large Corporates & Institutions
Large Corporates & Institutions High customer activity and strong net interest income growth Total income, EURm * Total income up 23% — + Net interest income up 29%, driven by higher average 622 660 lending volumes and deposit margins 537 547 515 * Commission income lower in continued weak capital m
Slide 14: Assets under management, EURbn
• • • • • • Assets under management, EURbn -5pp 500 1,0 0,8 300 0,6 200 0,4 100 0,2 0 0,0
Slide 15: 2025 financial target
2025 financial target Return on equity Nordea 2025: The preferred financial partner in the Nordics | Creating the best omnichannel customer experience Supported in 2025 by _ . Cost-to-income ratio | Driving focused and profitable growth : | Increasing operational and capital efficiency F \ \ Loan lo
Slide 16: Slide 16
Slide 17: • - - - • - - • - - 0.0 0.0 0.0 0.0
• - - - • - - • - - 0.0 0.0 0.0 0.0 0.0
Slide 18: Sweden Norway Denmark
• - - 4.0 • 3.0 2.0 - - 1.0 Sweden Norway Denmark ~ Finland - 0.0 ~ - -1.0 Q122 Q222 Q322 Q422 Q123 Q223 Q323 Q423 Q124 Q224 Q324 Q424
Slide 19: Supplementary information: Real estate management industry
Supplementary information Real estate management industry (REMI)* Well-diversified portfolio of high quality CRE lending stable 31 30 30 31 30 Q122. Q222. -Q322 -Q422:«Q123 MMI CRE (EURbn) Ml RRE (EURbn) 92% of portfolio with low probability of default (PD) 26bn 01 2022 BB a2 2022 Q3 2022 Q4 2022 Q1
Slide 20: Supplementary information: Real estate management industry
Supplementary information Real estate management industry (REMI)* Prudent LTV levels and interest coverage Moderate LTV levels for all Nordic countries + Moderate LTVs, resilient interest coverage and low vacancy rates * 97% of exposure with LTV below 65% + Average Interest Coverage Ratio (ICR) 5.8x
Slide 21: RW floor Q122 Q222
100% RW floor • 43 50% 7 30 6 • 97% 98% 98% 98% 98% 0% 0% 0% 0% 0% • 2% 2% 2% 1% 1% Q122 Q222 Q322 Q422 Q123 Q123 1-notch 2-notch Impact Stage 1 Stage 2 Stage 3 • 64 61 61 57 53 47 43 43 40 40 Impairment rate (bp) Coverage ratio (%) Q122 Q222 Q322 Q422 Q123
Slide 22: Supplementary information: Credit portfolio
Supplementary information Credit portfolio Well diversified with strong credit quality Portfolio well diversified Analysis of high inflation and lower Ten segments with 8% of total across countries and segments disposable income impact by exposures significantly affected segment Ship building Air tr
Slide 23: Supplementary information: Impairments and provisioning coverage
Supplementary information Impairments and provisioning coverage Strong and stable portfolio credit quality Stage 2 and 3 loans at amortised cost, EURm I Stage 2 TE 3 5 MM Stage 3 Qi22 222 322 Q422 18 Coverage ratio, % 48 46 46 10 ‘8 45 45 a4 4343 4 go \ fs 8 42 40 ° ® 37 34 35 34 34 32 31 31 31 30 3