Storebrand Asa · OSL:STB
Storebrand Asa — Q1 2022 Earnings Presentation
44 slides from Storebrand Asa's earnings presentation, 2022
Slide 1: Investor Presentation Q1 2022
Storebrand Investor Presentation Q1 2022 1
Slide 2: Storebrand - An Integrated Financial Service Group
Storebrand - An Integrated Financial Service Group Insurance ▪ P&C, Health and Life insurance Asset Management ▪ NOK 6.8bn in ▪ NOK 1,040bn AuM annual written ▪ 46% external investors premiums ▪ 100% of investments Pension & Savings subject to sustainability ▪ 40k corporate customers screening ▪ 2m
Slide 3: Leader in DC Occupational Pension and Asset Management, and a challenger in the Retail Market
Leader in DC Occupational Pension and Asset Management, and a challenger in the Retail Market Occupational Pensions Norway Occupational Pensions Sweden ✓ Digital leader Defined Contribution share1 Defined Contribution share2 in Sweden ✓ Best customer satisfaction with all time high score for 30% 34%
Slide 4: 250 years of pioneering in the Nordic financial industry
250 years of pioneering in the Nordic financial industry ILLUSTRATIVE - Future Storebrand builds strategic strengths Future Storebrand Retail Insurance & Bank Asset Management Unit Linked Pensions and Guaranteed pensions Savings 1767 1847 1861 1917 1995 2022 2050 Foundation: P&C Pioneered Pioneered
Slide 5: Sustainable Nordic Savings and Insurance Group
Pursuing our Group Strategy: Leading The Way In Sustainable Value Creation to be a leading Sustainable Nordic Savings and Insurance Group A B C Future Storebrand Leading Provider Growth focus in Nordic Powerhouse in Growing Challenger in Occupational Pensions capital-light business Asset Management
Slide 6: Future Storebrand is delivering strong growth in Savings and Insurance
Future Storebrand is delivering strong growth in Savings and Insurance Unit Linked Asset management 308 +11%1 +19%1 268 1 097 962 220 721 831 168 179 707 140 487 535 571 577 105 128 442 64 85 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 UL reser
Slide 7: Growth accelerated with selected add-on acquisitions that build on Group synergies
Growth accelerated with selected add-on acquisitions that build on Group synergies A B C Leading Provider Occupational Nordic Powerhouse in Growing Challenger in Norwegian Retail Pensions Asset Management Market Norway & Sweden Bolt-on acquisitions 2017-2021 Strategic ▪ M&A bolt-ons have been used a
Slide 8: The Group has transitioned from guaranteed to capital light business
The Group has transitioned from guaranteed to capital light business Premiums Storebrand1 Profit Storebrand2 Shift in total Storebrand AUM3 36 808 4 503 1 097 7% 14% 14% 32% 46% 24 584 9% 49% 1 960 3% 442 24% 72% 18% NOK bn NOK m NOK m 15% 61% 14% 4% 52% 9% 36% 21% 59% 27% 15% 2012 2021 2012 2021 20
Slide 9: Blend of growing high ROE future business and low ROE run-off business
Storebrand is a blend of growing high ROE future business delivering dividends, and low ROE run-off business realising capital Future Run-off ILLUSTRATIVE Storebrand business Savings & Insurance Guaranteed4 Group IFRS earnings1 (NOKm) 2 256 1 401 3 657 Allocated Equity2 34.2 (NOKbn) 6.5 27.7 Pro for
Slide 10: Storebrand is committed to deliver growing ordinary dividends to shareholders
Storebrand is committed to deliver growing ordinary dividends to shareholders Regulatory cancelled due to Covid-19 +8% 3.50 3.25 3.25 ▪ IFRS result growth - Ordinary 3.00 dividends minimum 50% of result 2.50 after tax, with nominal growth. 0.40 1.55 ▪ Capital return from back book. Share buybacks pr
Slide 11: Share buyback program to be initiated
Share buyback program to be initiated Solvency II ratio 184% ▪ Consider share buybacks when solvency ratio is above Q1 2022 180% without material use of transitional capital ▪ The Board has conducted a forward-looking assessment including a consideration of future events 180% and risks. ▪ Ordinary d
Slide 12: Financial targets are maintained for a robust balance sheet and profitable business
Financial targets are maintained for a robust balance sheet, a profitable business, and reaffirming commitment to growing dividends Target Actual 2021 % Solvency 2 margin Storebrand Group1 > 150% 175% NOK 3.50 > 50% Dividend pay-out ratio2 52% & nominal growth +0.25 y/y Return on equity3 10.7% > 10%
Slide 13: Progress in business units
Progress in business units 13
Slide 14: Market leader in an attractive growth market - Private sector occupational pensions Norway
A Occ. Pensions Market leader in an attractive growth market NOR - Private sector occupational pensions Norway Strong AuM market growth Defined Contribution, Market growth - Defined Contribution gross premiums run-off for Defined Benefit NOK bn NOK bn Defined Contribution private sector Defined bene
Slide 15: Storebrand delivers market leading return to Norwegian pension customers
A Storebrand delivers market leading return to Norwegian Occ. Pensions NOR pension customers 3 years annaulised return 5 years annaulised return 17,0 % 16,5 % 15,9 % 16,3 % High equity content 15,3 % 14,6 % 12,3 % New regulation secures pension offering 11,4 % 10,9 % 10,9 % to more employees from 20
Slide 16: Challenger in a profitable public sector market in Norway
A Occ. Pensions Challenger in a profitable public sector market in Norway NOR - Significant competence, technology and asset management synergies 1 2 3 High market Gradual entrance Profitable and potential1 into market capital light AuM new customers PUBLIC 5 BNOK MUNICIPALITIES CORPORATIONS 2022 6
Slide 17: Continued strong result growth with increased quality in Sweden
A Continued strong result growth with increased quality in Sweden Occ. Pensions SWE Profit before tax and amortisation SPP's own contribution to increased result 1.286 Operating profit Financial items and risk result life Operating profit 480 • Annual premiums from 2015 to 2021 has doubled 836 • Nom
Slide 18: Positive development in premiums, transfers and new sales
A Positive development in premiums, transfers and new sales Occ. Pensions SWE All figures in MSEK Premium income q1, core business Net transfers* New sales** Stable growth Better, but still challenges All time high +61% +11% 2.609 570 2.448 2.228 332 497 2.187 331 -471 318 -594 1.738 484 391 355 353
Slide 19: Strong capital release from maturing guaranteed book in Sweden leading to increased ROE
A Strong capital release from maturing guaranteed book in Sweden leading to Occ. Pensions SWE increased ROE Capital release… ...increases RoE... …partly due to large pay-outs (SEK bn) (SEK bn) +5,0 8,7 0,7 Repayment loan 17,9% 9,5% 10,1% 3,7 8,0 Dividend 7,9% 10,9% 6,5% -6,5 -6,7 -6,9 -6,9 -7,0 -7,3
Slide 20: Storebrand Asset Management: A family of strong brands with a clear strategic position
B Storebrand Asset Management: A family of strong brands with a clear Asset Mgmt. strategic position and value proposition 1 2 3 Local Nordic Partner Gateway to the Nordics Sustainable pioneer • Local solutions • Nordic solutions • Innovative sustainable solutions • Long term commitment • Bespoke an
Slide 21: Managing NOK 1,097 billion of assets for internal and external clients
B Asset Mgmt. Managing NOK 1 097 billion of assets for group internal clients and external clients with a growing focus on alternative asset classes Source of funds Managed Asset Classes 2% 15% 46 % 45% 54 % 38% Group internal External Equities Bonds Alternatives Other 21
Slide 22: Significant AuM-growth in 2021, driven by strong flows and good returns
B Significant AuM-growth in 2021, driven by strong flows and Asset Mgmt. supported by good returns Pension savings Norway* Institutional Clients 444 21 390 362 35 360 17 27 13 FY 2021 Q4 20 Flow Return Q4 21 Q4 20 Flow Return CI Q4 21 AuM 1 097bn Pension savings Sweden +135bn Direct retail savings 1
Slide 23: Successful expansion of serving clients outside of Norway and Sweden
B Successful expansion of serving clients outside of Norway Asset Mgmt. and Sweden Expanding outside of Norway Total AuM development outside of Norway and Sweden (bn) 59 23 Capital Investment 25 15 36 • Danish branch established May 2020 2019 2020 2021 • Finnish branch established February 2022 23
Slide 24: Significant technological and operational transformation with high ambitions for further digitalisation
B Occ. Pensions Significant technological and operational transformation with NOR high ambitions for further digitalisation Common operational Common policies and platform principles • Consolidated into one unit holder • Sustainable investments registry (4→1) – Wolf • Harmonized fund pricing and • E
Slide 25: Storebrand retail business has delivered 22% yearly top-line growth since 2019
C Storebrand retail business has delivered 22% yearly top-line growth Retail Norway since 2019 and are establishing itself as an important profit driver Retail market P&L (NOK m) Becoming an important profit driver • Retail market contributed to 21% of Storebrands total profit in 20211 +42% • Profit
Slide 26: P&C insurance growth, fastest growing retail insurer in Norway
C Retail P&C insurance growth, fastest growing retail insurer in Norway Norway Portfolio Premiums and Market share - Retail Insurance Portfolio premiums Market share Change in market share in 2021 NOK million1 %2 %-points2 +54% Storebrand Competitors 6.0% +1.5 3 301 4.5% 2 144 3.5% 3.7% 1 915 1 743
Slide 27: The retail business system leverages Storebrand's large customer base and digital capabilities
C Retail Norway The retail business system leverages Storebrand's large customer base and excellent digital capabilities driving scalable growth DATA DRIVEN RECRUITING SEGMENTS AND CONCEPTS PRODUCT AREAS CUSTOMER DEVELOPMENT MASS MARKET Insurance Nest-builders and Employees with customers in occupat
Slide 28: Leveraging external distribution power and partnerships to fuel insurance and bank growth
C Retail Norway Leveraging external distribution power and partnerships with large customer base to fuel insurance and bank growth Strong external distribution network Generated ~475 mNOK gross sales and Utilizing partners to access attractive with local presence ~34.000 new customers in 2021 custom
Slide 29: Storebrand has invested in a sustainable future since 1995
Storebrand has invested in a sustainable future since 1995 25 years of Top 10% most Nr.1 sustainable Nr. 1 insurance sustainable sustainable company investments in Norway company globally1 investments in the world2 and Sweden3 Decision to integrate Next Commitment Sustainability Exclusions Storebran
Slide 30: Goal to achieve net zero emissions by 2050, with intermediate targets towards 2025
With a goal to achieve net zero emissions by 2050, Storebrand has defined intermediate targets towards 2025 Asset class targets Solution targets Active ownership Customer engagement -32% reduction in scope 1-2 GHG emissions of 15% of our total Special emphasis will be Make it easy for clients to Sto
Slide 31: Strong progress on carbon reduction initiatives and increased investments in solution companies
Strong progress on carbon reduction initiatives and increased investments in solution companies to meet our 2025 targets Carbon footprint equity investments Carbon emissions direct real estate1 Investments in solution companies2 493 AUM (NOK bn) Share of AUM 6,5% 9,6% 11,2% 385 357 +129% Share of AU
Slide 32: Integrated Sustainability and Annual Report 2021
Integrated Sustainability and Annual Report 2021 About us Investments Operations People Investments in 318 Purchasing volume from Active dialogues Number of employees in Assets under management, solutions, NOK environmentally certified Storebrand ASA NOK billion billion (% of AUM) related to climate
Slide 33: Capital management
Capital management 33 G2 storebrand
Slide 34: Key Figures Q1 2022
Key Figures Q1 2022 Strengthened solvency position, stable operating result and solid buffer capital levels Result development1 Earnings per share2 Financial items and risk result life Performance related result MNOK Special items Operating profit 2.79 1,353 1,367 2.25 2.18 121 913 329 870 546 1.56
Slide 35: Solid capital position with low leverage and strong liquidity gives financial flexibility
Solid capital position with low leverage and strong liquidity gives financial flexibility Group capital (NOK billion) and leverage ratio Liquidity position Storebrand ASA (NOK billion) 26% 24% 22% 20% 20% 23% 9.5 38.4 35.9 2.0 32.9 7.7 7.6 8.1 27.6 8.1 1.0 24.7 4.9 20.2 5.7 6.1 30.8 27.8 6.6 24.8 22
Slide 36: IFRS results close to cash provide fungible group capital
IFRS results close to cash provide fungible group capital Storebrand ASA: ∑ NOK 3 352m Dividends 2021: 3,50kr pr share NOK 3 352m NOK 2160m NOK 86m NOK 948m NOK 158m NOK 1 646m NOK 1 706m Storebrand Storebrand Storebrand Asset Storebrand Livsforsikring AS Forsikring AS Management AS Bank ASA Remitta
Slide 37: Estimated solvency sensitivities, Q1 2022
Estimated solvency sensitivities, Q1 2022 Storebrand Group Solvency position(%)1 Estimated sensitivities Target SII margin 150% 175 184 0 0 SII-margin Q1 184 0 184 175 184 Interest rates -50bp 181 0 181 Q4 2021 Q1 2022 Interest 184 0 184 Transitional rules SII standard model rates +50 bp Key takeawa
Slide 38: More robust capital position with increased spreads and reduced duration mismatch
More robust capital position with increased spreads above discount rate and reduced duration mismatch Expected investment return above Reduced duration gap (years), discount rate (%), Solvency II1 Solvency II2 ∼1.3 % 2.6 1.2 Duration gap ∼0.7 % GUARANTEED NORWAY 6.0 5.7 Asset duration CMD 2020 2022
Slide 39: The transformational journey towards an asset management based and capital light business continues
The transformational journey towards an asset management based and capital light business continues Forecast assets under management in Storebrand Group (NOKbn) Implications ILLUSTRATION 2 000 2021: 2031e: ▪ Guaranteed pensions in run-off reduces 77% of AuM ~90% of AuM 1 500 capital consumption non
Slide 40: Guaranteed Back Book is in Run-Off
Guaranteed Back Book is in Run-Off Guaranteed share of pension reserves has declined Net outflow expected 100% Accumulated net flow in guaranteed book, NOK bn 90% -54 80% -108 70% -160 60% -206 -245 50% -275 40% 30% <50% 20% 10% 0% 2013 2015 2017 2019 2021 2025 2030 2035 2040 2045 2050 40 Norwegian
Slide 41: Guaranteed reserve growth in recent years is due to actively sold products and buffer capital
Guaranteed reserve growth in recent years is due to actively sold products in growth, and increased buffer capital due to excess returns Reported Total Guaranteed Reserves (NOK bn) Guaranteed reserves Norway (NOK bn) 198 291 187 288 179 183 20 Customer Buffers 11 14 18 11 3 3 3 Actively sold 273 270
Slide 42: Target solvency ratios - more low risk and less volatile business means less need for buffer
Target solvency ratios - more low risk and less volatile business means less need for solvency buffer in the future SCR Buffer over SCR 'Future Storebrand' 'Run-off business' Solvency 2 Group Future Solvency 2 target range Low volatility business with less Interest rate sensitive business in run- To
Slide 43: Asset allocation – Guaranteed products, Q1 2022
Asset allocation – Guaranteed products, Q1 2022 Storebrand Livsforsikring AS (Norway) SPP (Sweden) 60% 60% 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% 0% Bonds & Bonds at Bonds & Real Equities Money Loans amortised Equities Real estate Money Loans estate market cost market 31.03.2021 10% 11% 12% 13%
Slide 44: Leading the way in sustainable value creation
Leading the way in sustainable value creation Investor Relations contacts Lars Aa Løddesøl lars.loddesol@storebrand.no Group CFO +47 9348 0151 Kjetil R. Krøkje kjetil.r.krokje@storebrand.no Group Head of +47 9341 2155 Finance & Strategy Daniel Sundahl daniel.sundahl@storebrand.no Group Head of +47 9