Nordea Bank Abp · OMXHEX:NDA_FI
Nordea Bank Abp — Debt Investor Presentation (2022)
46 slides from Nordea Bank Abp's debt investor presentation, 2022
Slide 1: Debt investor presentation Q1 2022
Nordea Debt investor presentation Q1 2022 6
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: Table of contents
Table of contents 1. Nordea first-quarter 2022 update 4 2. Credit quality 16 3. Capital 23 4. Funding 26 5, Macroeconomy 35 6. Appendix 40 ° Nordea
Slide 4: 1. Nordea first-quarter 2022 update
1. Nordea first-quarter 2022 update Nordea
Slide 5: Q1 2022
(Q1 2022)** ( ) (Q1 2022) Confidential
Slide 6: First-quarter highlights 2022
First-quarter highlights 2022 Executive summary* Resilient performance, continued lending growth - Mortgage volumes up 7% y/y, SME lending up 6% y/y and large corporate lending up 11% y/y. Assets under management down 5% q/q Increased income and higher operating profit - Net interest income up 8% an
Slide 7: Key financials
Key financials First-quarter results 2022* come statement and key ratios Q122 Q121 Q1/Q1 Q421 Q1/04 Net interest income 1,308 1,212 8% 1,255 4% Net fee and commission income 870 827 5% 920 -5% Net fair value result 295 370 -20% 247 19% Other income 17 11 16 Total operating income 2,490 2,420 3% 2,43
Slide 8: Net interest income
Net interest income Growth in business volumes driving NIl increase Year-over-year bridge, EURm v 1,308 — Bee Dr ee __ st 28 1212 oe al — - Q121 Volumes = Margins Other FX Day count Q122 Quarter-over-quarter bridge, EURm ™ > | Te 4 1,308 1,255 20 B aa —_ Q421 Volumes = Margins Other FX Day count Q12
Slide 9: Net fee and commission income
Net fee and commission income Growth in savings fee income despite market turbulence Year-over-year bridge, EURm v - a 870 [| 15 7 360000" 827, coal -_ Q121 Asset Brok.& Pay.& Lending Other FX Q122 mgmt. advisory cards Quarter-over-quarter bridge, EURm @ 920, 54 —— an 870 ge" 5 3 2 8 <= _ Q421 Asset
Slide 10: Net fair value result
Net fair value result Strong customer activity supporting net fair value result Net fair value result, EURm f 370 278 32 247 3 224 43 213 214 -10, Q121 Q221 Q321 Q421 HM Customer areas* Treasury & other** 1 Market-making operations 10 * Excludes fair value adjustments to loans held at fair value in
Slide 11: Costs
Costs Cost increase mainly due to higher regulatory costs Year-over-year bridge, EURm = 7 : 5) 49 1319 25 Q121 Underlying — Regulatory fees FX Q122 costs Quarter-over-quarter bridge, EURm 1,388 — —— 273 1,101 — 15 ee 40 Q421 Underlying VAT Regulatory FX Q122 costs refund Q4 fees Q1 Confidential Cost
Slide 12: Russia exit
Russia exit Limited direct impact on Nordea Russia-related items affecting comparability (IAC) EURm Item impacted Description * Banking operations in Russia closed in 2021 - EUR 529m IAC in Q1 2022 related to recycling of FX losses -529 Net result from items at fair value IFRS recycling of triggered
Slide 13: Raising the bar: Ready to deliver on higher target
Raising the bar: Ready to deliver on higher target a | The preferred financial partner in the Nordics | Creating value for shareholders | Well equipped for the future 2025: Return on equity >13% Revenue growth C pturing further market Cost-to-income ratio to 45-47% ment in und o-income ratio ettling
Slide 14: Sustainability at the core
Sustainability at the core Long term commitments and objectives supported by short term targets °) Our long-term commitment and objective: @ Net-z e kk Supported by our 2025 targets?: € EUR >200bn ) ALS At least 40% Nordea 14 Confidential
Slide 15: Sustainability at the core
Sustainability at the core Key strategic priority 9) Our sustainable business Facilitate sustainable financing Green lending EURbn 2022-2025 EURbn 12.1 200 Target B® 9.7 57.2 26 = - w __ Q1 2022 (annualised) 2025 2019 2020 2021 Q1 2022 ESG share of AuM and net flow 37% * 3M AuM Other | MM Aum Esc 20
Slide 16: 2. Credit quality
2. Credit quality Nordea
Slide 17: Credit portfolio
Credit portfolio Well diversified with strong credit quality Portfolio well diversified Updated analysis of COVID-19 across countries and segments impact by segment MEAU:Ki LAM Significantly affected aoe Partially affected 43% Not significantly affected 8% Corporates Consumer Ill Mortgages 48.8% Len
Slide 18: Net loan losses and similar net result
Net loan losses and similar net result Net reversals and lower non-performing loans Net loan losses and similar net result Q1 2022 excl. IAC, EURm * Net loan losses and similar net result amounting to reversals of EUR 12m (1bp) - Limited new provisions - Reversals from Oil, gas & offshore portfolio
Slide 19: Impairments and provisioning coverage
Impairments and provisioning coverage Continued strong credit quality Stage 2 and 3 loans at amortised cost, EURm I Stage 2 MM Stage 3 qi21 Q221 Q421 Q122 Coverage ratio, % 48 46 " a" 43. 43 a 44 42 42 42 ° 42 40 33 ° 38 36 37 34 35 34 34 32 34 31 4 36 3a 2 —Stage 3 32 — Stage 2 30 ° Q120 Q220 Q320
Slide 20: Confidential
• • 5 4 3 2 • 1 - 0 -1 -2 Denmark Finland -3 Norway Sweden -4 - 10 9 • 8 - 7 6 5 4 • 3 2 - 1 Denmark Finland Norway Sweden 0 Confidential
Slide 21: Credit quality
Credit quality Portfolio significantly de-risked over past 10 years Significant de-risking (EURbn) Mix change Focus on Nordic markets International and shipping, oil and 313 328 313 328 offshore exposure a a Al + 58 67 ~ 929 _ 999 Public sector Dd 92% 99% HB Household 40 QB 88 Hl Corporate 102 8 Non
Slide 22: Coverage ratios
Coverage ratios Solid provisioning coverage against potential losses Segments significantly Segments partially affected by COVID-19 affected by COVID-19 Avg. 40% Avg. 45% Acc. Air Oil, Consumer Media& Capital Land © Mining Wholesale Comm. Maritime Construction & transp. gas & durables entert_ goods
Slide 23: 3. Capital
3. Capital Nordea
Slide 24: Capital
Capital Significant buffer to capital requirements Capital position and requirements (%) 6.0% 20.5% CET1 ratio CET1 Total Own funds Q1 2022 requirement capital ratio requirement Q1 2022 HB Actual O-SI| Ml Pillar 2 requirement © CCyB MCCoB HM Minimum CET1 requirement 24. *As of Qt 2022, approximately
Slide 25: Capital excellence
Capital excellence Reducing capital excess — path to normalisation CET1 capital ratio and requirement CET1 ration, CET1 eto a00b ~15% ~12% “15-16% idends & share buy-backs Pre COVID-19 During Normalised COVID-19 conditions ~2025 Capital generation and uses of capital (bp) 2021 2022-25 700 480 4,000
Slide 26: 4. Funding
4. Funding Nordea
Slide 27: Confidential
15.1 13.2 13.7 • - 7.8 - - 0.6 • - - • - Confidential
Slide 28: Funding mix
Covered Senior preferred** SNP • - - - - • - - CD & CP below Green covered 1Y bonds 26 % 1% - CD & CP above 1Y - 4% Scandinavian Subordinated debt covered bonds 3% 47 % SNP 3% Senior preferred bonds 8% Green SP/SNP International 1% covered bonds 7% *Excluding capital transactions and DKK covered bon
Slide 29: Funding by currency
3% 1% 7 % 2% 6% 5% 13 % 97 % 75 % DKK NOK 90 % (EUR 56bn eq.) (EUR 13bn eq.) 6% SEK 35 % (EUR 33bn eq.) 8% 14 % 21 % 59 % 27 % 18% 23 % JPY 22 % 42 % (EUR 1bn eq.) 46% 100 % 10 % GBP 4% 32 % 28 % (EUR 3bn eq.) CHF 5% (EUR 1bn eq.) EUR USD (EUR 29bn) (EUR 14bn eq.) 29 Confidential
Slide 30: Enhanced focus on sustainable funding
Sustainability at the core Enhanced focus on sustainable funding Inaugural green bond from NBAbp launched in 2017 - EUR 2.75bn currently outstanding of green bonds from NBAbp Nordea Bank Abp's green bond asset portfolio = Green buildings Inaugural green covered bond launched in 2019 - EUR 2.3bn curr
Slide 31: Covered bond issuers
Nordea Eiendomskreditt Nordea Hypotek Nordea Kredit Nordea Mortgage Bank • • • 31 Confidential
Slide 32: Funding transactions
Funding transactions Nordea recent benchmark transactions Issuer Type Currency Amount (m) FRN/ date AR Callable Nordea Mortgage Bank Covered @ «ur 1,500 Fixed Mar-22 Mar-29 Nordea Bank Senior non-preferred, Green @ &uR 1,000 Fixed Feb-22 Feb-27 Nordea Eiendomskreditt* Covered, Green 4= NOK 7,000 FRN
Slide 33: Minimum requirements for own funds and eligible liabilities
Minimum requirements for own funds and eligible liabilities Well positioned to meet MREL requirements MREL positions at end of Q1 2022 and requirements Nordea subordinated MREL ratio 4.4pp above % ; ; REA requirement IM Subordination requirement, % REA Ill Combined buffer requirement Total MREL requ
Slide 34: Point of non viability Resolution
Point of non viability Resolution • - - • • 10 - 3 3 25 CET1 AT1 T2 SNP target Remaining senior Q122 Q122 Q122 end of 2023 unsecured debt Confidential
Slide 35: 5. Macroeconomy
5. Macroeconomy Nordea
Slide 36: Nordic economic development
Nordic economic development Resilient economies face global uncertainty GDP development 36 Index 2007Q1=100 GDP, level Index 200791=109| - 130 ==sweden Norway 128 Denmark _- ~b120 Finland ‘ pus <7 bano 90 070809 10°11 12°13 14°15 16 17 18 19 20 21 22°23 After the dramatic setback in 2020 due to the
Slide 37: Nordic economies
Nordic economies Interest rates to rise throughout the Nordics Policy rates Public balance/debt, % of GDP, 2022E 3.0 3.0 1 1 % Policy rates % Denmark _ Norway 2022E 25 25 ° ° 20 20 aa eo Sweden A : Ss eo oermany 1s 1s x2 A Finland 2 ® "| Netherlands eo oe ortusal 10 1.0 g - i-- 5° - va Belgium 3 os
Slide 38: Households
Households. Households facing high inflation and rising interest rates Household debt Household savings 300 16% of disposable Household debt % of disposable] 30° 20.0 1% of disposable Household saving rate 20.0 275 Jincome income|. 275 7s income 175 250 250 15.0 15.0 225 225 2s 25 200 200 10.0 10.0
Slide 39: Housing markets
Housing markets Rising interest rates might cool off hot Nordic housing markets Housing prices Households’ credit growth 250 250 15.0 15.0 Index, 2007100 Housing market l% v/y Households’ credit growth % y/y| 3m moving average 225 9 ‘9 225 125 125 Sweden 200 200 10.0 10.0 Norway 175 175 75 om J ww 7
Slide 40: 6. Appendix
6. Appendix Nordea
Slide 41: Personal Banking
Personal Banking Continued strong growth in mortgage lending Total income, EURm > & + Total income up 5% 879 931 922 913 925 * Increased mortgage market shares across Nordics 561 569 573 556 565 + Net fee and commission income growth negatively affected by market turbulence during quarter + Improvem
Slide 42: Business Banking
Business Banking Strong income growth Total income, EURm 682 715 637 644 =e. 153 86 79 96 111 Q121 Q221 Q321 Q421 Q122 Net interest income Il Net fee and commission income Net fair value result and other Lending*, EURbn Co: Total income up 12% Lending volumes up 6%, driven by Sweden and Norway Net f
Slide 43: Large Corporates & Institutions
Large Corporates & Institutions Solid quarter amid significant market volatility Total income, EURm * Total income down 15% + Net interest income up 11% and lending volumes up 11% * High customer activity, solid commission income + NFV lower compared with exceptionally strong Q1 2021 * Net loan loss
Slide 44: Assets under management
• • • • • Assets under management, EURbn +2pp 500 1,0 0,8 300 0,6 200 0,4 100 0,2 0 0,0 Confidential
Slide 45: Financial crime prevention
Financial crime prevention Significant investments Financial crime prevention spending, annual Employees EURm 300 1,600 1500 >1,500- >1,500>1,500>1,500 . 250 1,400 1,200 210 200 190 1,000 780 180 190 150 800 Joo ; 600 / — Financial crime prevention staff 100 , — Cinancinl cr . 400 | 7 Financial crim
Slide 46: Contacts
Contacts Investor Relations Matti Ahokas Head of Investor Relations Mobile: +358 40 575 9178 matti.aahokas@nordea.com Group Treasury Anders Frank-Leessoe Group Treasurer, Head of Group Treasury Tel: +45 55477672 Mobile: +45 61612157 anders.frank@nordea.com 46 Maria Caneman Debt IR and ratings Mobile