Nn Group N.v. · EURONEXT:NN
Nn — Bank of America Merrill Lynch Banking & Insurance CEO conference 2015
16 slides from Nn's conference presentation, Sep 29, 2015
Slide 1: NN Group
NN Group Lard Friese, CEO Bank of America Merrill Lynch conference London, 29 September 2015
Slide 2: Leading Dutch insurer with strong businesses in European insurance, investment management and Japan
Leading Dutch insurer with strong businesses in European insurance, investment management and Japan Geographical reach Some facts and figures Japan History dating back to 1845 Top 3 player in COLI2 The Netherlands Strong business positions Leading positions in Market positions were built organ
Slide 3: Diversified businesses in Europe and Japan
Diversified businesses in Europe and Japan Low interest rates and pressure on fees Continue to invest in building and broadening and premiums from run-off of closed the capabilities of the business block, partly mitigated by increased asset Focus on growing third-party business allocation to h
Slide 4: Investment proposition focused on cash generation
Investment proposition focused on cash generation Profitable growth and Focus on generating Strong business positions Transformation in operating leverage in capital and improving and balance sheet Netherlands other segments earnings • Committed management • Large closed book of • Primarily fee and
Slide 5: Delivering on our financial targets …
Delivering on our financial targets … Administrative expenses1 Earnings2 ROE3 Target reduction of EUR 200 mln Target annual growth of 5-7% on Target increase in medium term by 2016 average in the medium term compared with 2013 pro-forma 7.1% -200 +44% -198 1,019 792 11.8% 819 -142 -56 551 7.1% FY13
Slide 6: … and generating free cash
… and generating free cash Over time NN Group expects to generate free cash available to shareholders in a range around the Group’s net operating result of the ongoing business1 FY14 6M15 806 688 630 450 Net Free cash Net Free cash operating flow 2 operating flow result result 1. Assuming normal mar
Slide 7: Track record of returning capital to shareholders
Track record of returning capital to shareholders July 2014 Feb 2015 May 2015 May 2015 June 2015 Sept 2015 IPO EUR 200 mln EUR 150 mln EUR 193 mln EUR 156 mln share buyback share buyback 2014 final 2015 interim EUR -57 mln dividend dividend capital injection related to NN Bank • Total capital return
Slide 8: Strong solvency and disciplined capital framework
Strong solvency and disciplined capital framework Commercial capital at operating units Cash capital at holding Leverage Intention to manage the operating units to Seek to hold cash capital in the holding to Aim to maintain leverage and fixed charge their commercial capital levels cover stress
Slide 9: Solvency II
Solvency II 2014 2015 2016 2017 Delegated acts NN Group S2 ratio (SF) NN Group applied for Approval process on final S2 S2 becomes Successful IPO First full year published estimated to be in a the usage of a Partial model for supervision to be effective as of on 2 July report to regulator providing
Slide 10: Impact of low interest rates on capital actively managed
Impact of low interest rates on capital actively managed Netherlands Life asset and liability cash flows Limited interest rate sensitivity across all segments Limited impact of interest rate shocks on regulatory capital due to hedging on an economic basis by cash flow matching of assets and liabil
Slide 11: Over time, NN Group expects to receive remittances from all segments
Over time, NN Group expects to receive remittances from all segments Over time, remittance Drivers vs. net operating result Regulatory liabilities more conservative than IFRS, realisation of investment spreads over Netherlands Life > swap incl. gains/losses on real estate and equities to drive cas
Slide 12: Annual cash capital generation at holding will be significantly more volatile than operating result
Annual cash capital generation at holding will be significantly more volatile than operating result Cash flow volatility Drivers of volatility High sensitivity to credit spread movements (incl. government spreads vs. swaps); movement temporary as assets held to maturity Market Limited sensitivit
Slide 13: Dividend policy of returning cash to shareholders
Dividend policy of returning cash to shareholders NN Group aims to pay a dividend of 40-50% of IFRS net operating result ongoing business Dividend of EUR 0.57 per ordinary share over second half of 2014, representing a pay-out ratio of around 50% of net operating result of the ongoing business for
Slide 14: Over the medium term, NN Group expects to …
Over the medium term, NN Group expects to … 1 Deliver significant cash to shareholders 2 Increase exposure to growth markets and fee business 3 Improve efficiency and profitability of all segments 4 Maintain a strong capital base and de-risk liabilities 14
Slide 15: Important legal information
Important legal information NN Group’s Consolidated annual accounts are prepared in accordance with International Financial Reporting Standards as adopted by the European Union (“IFRS-EU”) and with Part 9 of Book 2 on the Dutch Civil Code. In preparing the financial information in this document, the
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