Storebrand Asa · OSL:STB

Storebrand Asa — Q4 2017 Earnings Presentation

28 slides from Storebrand Asa's earnings presentation, Feb 7, 2018

  1. Slide 1: Storebrand 4Q 2017

    Storebrand 4Q 2017 Storebrand celebrated 250 years in 2017 7 Feb 2018 Odd Arild Grefstad – CEO Lars Aa. Løddesøl – CFO

  2. Slide 2: Highlights 2017

    Highlights 2017 Group result1 20% Unit Linked growth2 2,940 513 25% AuM growth Asset Management2 MNOK 2,427 618 803 172% Solvency II ratio3 -185 4Q 2017 FY 2017 Financial items and risk result life 2 major acquisitions Operating profit NOK 2.5 dividend and new dividend policy 1 Result before amortis

  3. Slide 3: Our strategy

    Our strategy 1 Manage the guaranteed 2 Continued growth in Savings balance sheet and Insurance >150% SII margin Capital-light and profitable growth  Cost reductions through automation and  Market leading asset gatherer with strong outsourcing Insurance offering  Manage for future capital release

  4. Slide 4: Strong capital generation and robust balance sheet

    Strong capital generation and robust balance sheet +16% +172% +4% +159% +11% +155% -4% +2% +144% +7% -8% Q4 2016 Model and IR, VA, Equity Asset return & Operating Sub.deb/Skagen Q4 2017 before Proposed Q4 2017 excl. Transitionals Q4 2017 incl. assumption stress levels and Business mix* earnings divi

  5. Slide 5: Proposed dividend 2017

    Proposed dividend 2017 Dividend per share  Cash dividend of 40% of profit after 2.50 tax (adj for amortization) 0.40  NOK 2.10 per share in ordinary dividend and a NOK 0.40 in special 1.55 dividend is payed based on strong financial results and strong post tax results 2.10 1.55  Dividend of NOK 1

  6. Slide 6: New Dividend Policy

    New Dividend Policy Storebrand's objective is to create attractive and competitive returns for shareholders through dividends and value creation in the business. Our ambition is to pay stable and growing base dividends combined with special dividends to reflect financial markets volatility and capit

  7. Slide 7: Growth in Savings continues, Insurance growth paused by changes in distribution

    Growth in Savings continues, Insurance growth paused by changes in distribution Unit Linked Asset management 20% 25% 168 721 140  17% growth in 577  Growth driven by non-guaranteed and Sweden external mandates  23% growth in  Includes Norway consolidation of Skagen Q4 2016 Q4 2017 Q4 2016 Q4 201

  8. Slide 8: Positioned to capture growth in market for individual savings

    Positioned to capture growth in market for individual savings Market for long term Market share pre indivudual savings and post NOK 380bn 2017 SKAGEN + Silver PUP 21% 4% Pension certificates 18 % 11% Indivdual pension 5% Individual capital 10 % Mutual funds 62 % 2017 Est.2018 8

  9. Slide 9: Strengthened market position within private savings with launch of new products IPS and ASK

    Strengthened market position within private savings with launch of new products IPS and ASK Individual Pension Savings (IPS) Aksjesparekonto (ASK) #1 with 24 % market share1 #2 with 22 % market share2 4% 20 % 17 % 4% IPS ASK Storebrand Life Skagen Others Storebrand AM Skagen Others 1 Est. based on A

  10. Slide 10: Key figures

    Key figures Group Result development1 Earnings per share2 Financial items and risk result life Special items MNOK Operating result 1.89 1.77 912 1.64 878 1.56 773 618 386 671 225 15 1.25 177 208 88 792 578 565 596 463 -52 -189 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q

  11. Slide 11: Storebrand Group Solvency movement from Q3 2017 to Q4 2017

    Storebrand Group Solvency movement from Q3 2017 to Q4 2017 +16% +172% +2% +155% +2% +2% +2% +150% -2% 2017 Q3 Model Interest rate curve, Operating earnings Asset return Sub debt/Skagen Q4 2017 excl. Transitionals Q4 2017 incl. improvements and VA and Equity stress business mix change transitionals t

  12. Slide 12: Estimated SII position Storebrand Group

    Estimated SII position Storebrand Group Solvency position(%)1 Estimated sensitivities Target SII margin 150% 160 172 10 16 Estimated economic 155 13 169 SII-margin Q4 2017 Interest 150 155 rates -50bp 143 32 176 Interest 163 4 167 rates +50 bp Q3 2017 Q4 2017 Transitional rules SII standard model Eq

  13. Slide 13: Storebrand Group

    Storebrand Group Group Profit1 4Q Full year NOK million 2017 2016 2017 2016 Fee and administration income 1 534 1 145 4 779 4 294 Insurance result 261 251 1 146 945 Operational cost -992 -868 -3 498 -3 250 Operating profit 803 528 2 427 1 989 Financial items and risk result life -185 384 513 924 Pro

  14. Slide 14: SKAGEN – Q4 effects and 2017 results

    SKAGEN – Q4 effects and 2017 results Skagen results consolidated into Storebrand Q4 2017 NOK million 4Q 2017 Comments Fee and administration income 294 Income December Operational cost -41 Cost December Operating profit 253 Financial items -45 Earn out/financial result Profit before amortisation 208

  15. Slide 15: Normalised Quarterly Operational Cost

    Normalised Quarterly Operational Cost Comments 992 Special items 41  Transaction fees for Skagen and Silver  Restructuring costs SPP 67 Additional Q4 operational costs, 40 not expected to be repeated in 2018 830 14  Costs associated with the launch of new savings products  Refurbishing of head o

  16. Slide 16: Storebrand Group

    Storebrand Group Group Profit 4Q Full year NOK million 2017 2016 2017 2016 Fee and administration income 1 534 1 145 4 779 4 294 Insurance result 261 251 1 146 945 Operational cost -992 -868 -3 498 -3 250 Operating profit 803 528 2 427 1 989 Financial items and risk result life -185 384 513 924 Prof

  17. Slide 17: Savings (non-guaranteed) - continued growth

    Savings (non-guaranteed) - continued growth Savings Profit 4Q Full year NOK million 2017 2016 2017 2016 Fee and administration income 1 192 744 3 402 2 758 Operational cost -557 -426 -1 899 -1 700 Operating profit 635 319 1 503 1 058 Financial items and risk result life 4 3 8 5 Profit before amortis

  18. Slide 18: Savings (non-guaranteed) - strong growth in assets and retail lending

    Savings (non-guaranteed) - strong growth in assets and retail lending Savings Reserves and premiums Unit Linked Comments 4,0 3,7 3,6 3,7 3,5  6% premium growth in UL premiums1 168 158  19% retail lending growth2 151 147 BNOK 140  25% growth in assets under management2 Q4 2016 Q1 2017 Q2 2017 Q3 2

  19. Slide 19: Insurance

    Insurance Insurance Profit 4Q Full year NOK million 2017 2016 2017 2016 Insurance premiums f.o.a. 968 957 3 872 3 828 Claims f.o.a. -707 -706 -2 726 -2 883 Operational cost -193 -168 -711 -602 Operating profit 68 83 435 342 Financial result -36 60 173 233 Profit before amortisation 32 143 608 575 Pr

  20. Slide 20: Insurance - Implemented measures to reduce costs

    Insurance - Implemented measures to reduce costs Insurance Combined ratio Comments Combined ratio and results Claims ratio Combined ratio Cost ratio 91% 93% 89% 88% 85%  Combined Ratio 93%  Reduced premiums due to on-going shift to more cost-effective distribution and new 74% 71% 70% 68% 73% disab

  21. Slide 21: Guaranteed pension

    Guaranteed pension Guaranteed - NOK 200m provision in anticipation of a regulatory reduction of the ultimate forward rate in SPP Profit 4Q Full year NOK million 2017 2016 2017 2016 Fee and administration income 376 376 1 483 1 566 Operational cost -240 -260 -889 -981 Operating profit 136 116 595 585

  22. Slide 22: Guaranteed pension - reserves in long term decline and robust buffer situation

    Guaranteed pension - reserves in long term decline and robust buffer situation Guaranteed Reserves guaranteed products Comments 259 261 260 262 264 42 37 36 36 46  As companies convert to DC schemes, the migration from DB to lower-margin paid up 121 126 128 128 116 policies continues to reduce fee

  23. Slide 23: Other

    Other1 Other Profit 4Q Full year NOK million 2017 2016 2017 2016 Fee and administration income 20 43 83 145 Operational cost -56 -33 -188 -141 Operating profit -36 10 -105 4 Financial items and risk result life -48 -54 161 401 Profit before amortisation -84 -45 55 405 Profit per product line 4Q Full

  24. Slide 24: Appendix

    Appendix G2 storebrand

  25. Slide 25: Defined Contribution Returns - Standard Profiles Norway

    Defined Contribution Returns - Standard Profiles Norway 1 year 3 years Since inception1 19.3% 17.6% 14.6% 12.7% 11.3% 10.7% 8.4% 8.0% 6.8% 7.1% 5.3% 4.9% 2.9% 3.2% 2.4% Extra low risk Low risk Balanced High risk Extra high risk Gross annualised returns as of 31.12.2017. 25 1 Low, Balanced and High r

  26. Slide 26: Storebrand Life Insurance asset allocation

    Storebrand Life Insurance asset allocation 60% 50% 40% 30% 20% 10% 0% Bonds at Money Real Equities Bonds amortized Other market estate cost 31.12.2016 5% 27% 4% 52% 11% 1% 31.03.2017 6% 25% 4% 53% 11% 1% 30.06.2017 6% 25% 5% 52% 11% 1% 30.09.2017 7% 25% 4% 53% 11% 1% 31.12.2017 8% 24% 5% 52% 10% 1%

  27. Slide 27: SPP asset allocation

    SPP asset allocation 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Alternative Bonds Equities investments 31.12.2016 8% 87% 5% 31.03.2017 8% 86% 6% 30.06.2017 9% 85% 6% 30.09.2017 10% 84% 6% 31.12.2017 12% 80% 8% Note: The graph shows the asset allocation for all products with an interest rate guarant

  28. Slide 28: Investor Relations contacts

    Investor Relations contacts Lars Aa Løddesøl Group CFO lars.loddesol@storebrand.no +47 9348 0151 Kjetil R. Krøkje Head of IR kjetil.r.krokje@storebrand.no +47 9341 2155 This document contains Alternative Performance Measures as defined by the European Securities and Market Authority (ESMA). An overv

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