Slide 1: Storebrand Q2 2020
Storebrand Q2 2020 15 July 2020 Odd Arild Grefstad – CEO Lars Aa. Løddesøl – CFO
Slide 2: Highlights Q2 2020
Highlights Q2 2020 23% Unit Linked premium growth2 Group result1 808 17% AuM growth Asset Management2 228 474 MNOK 580 834 15% Insurance Portfolio Premium growth2 -360 Q2 2020 YTD 2020 163% Solvency ratio3 Financial items and risk result life Operating profit 24% Increased buffer capital4 2 1 Result
Slide 3: Our strategy: A compelling combination of self-funding growth and capital return
Our strategy: A compelling combination of self-funding growth and capital return from maturing guaranteed back-book 1 A B C D Asset manager with Build a world class Uniquely positioned in Leading position strong competitive Savings business growing retail savings Bolt-on M&A Occupational Pension pos
Slide 4: Strong growth
Strong growth Unit Linked Asset management +18% +17% 235 ▪ 23% premium growth 880 ▪ Positive effect from 198 752 financial market rebound ▪ Strong transfer balance in Norway and Sweden, NOK ▪ Successful fossil free fund +7bn net transfers YTD strategy in Sweden: NOK +12bn net flow in SPP ▪ Growing m
Slide 5: Strong net flow and consolidation of smaller pension funds contribute to growth in SPP
Strong net flow and consolidation of smaller pension funds contribute to growth in SPP H1 2016-2020 in SEK bn 6.7 Net flow Portfolio transfers 4.5 1.4 0.2 2.2 0.2 1.2 -0.7 -0.6 2016 2017 2018 2019 2020 5 Total transfers and flows in SPP
Slide 6: COVID-19 has confirmed that we operate in digitally mature markets
COVID-19 has confirmed that we operate in digitally mature markets, which gives opportunities to further accelerate digital speed Maturity indicators New opportunities Digital adoption in new … increase in digital insurance 41% sales from March 2020 to June business areas 2020 … of all retail saving
Slide 7: Key figures
Key figures Group Result development1 Earnings per share2 Financial items and risk result life Operating profit MNOK Special items 1.68 Performance related result 1,026 700 808 1.21 1.22 1.23 579 319 105 114 228 251 0.82 568 635 456 599 265 -44 -50 -49 -19 -588 -11 -334 Q2 2019 Q3 2019 Q4 2019 Q1 20
Slide 8: Lower interest rates affect the Solvency ratio
Lower interest rates affect the Solvency ratio 2.47 0.40 1.79 0.71 1.25 0.79 0.75 2.07 0.35 0.10 0.36 0.46 % 1.08 0.90 % 0.69 0.17 0.39 0.29 31.12.2019 31.03.2020 30.06.2020 31.12.2019 31.03.2020 30.06.2020 Volatility adjustment NOK Swap 10y Volatility adjustment SEK Swap 10y ▪ Lower interest rates
Slide 9: Movement from Q4 2019 to Q2 2020
Movement from Q4 2019 to Q2 2020 Group Storebrand ASA +174 % +1 % +5 % -3 % -2 % +26 % +163 % -23 % +5 % +137 % +5 % -2 % -20 % -2 % Q4 2019 Model and Updated Updated Equity Interest Asset Asset Retained Results Dividend Q2 2020 Transitional Q2 2020 assumptions UFR VA stress rates return allocation
Slide 10: Movement from Q1 2020 to Q2 2020
Movement from Q1 2020 to Q2 2020 Group Storebrand ASA +26 % +163 % +155 % +1 % +14 % +4 % +137 % -1 % -6 % -23 % -3 % -3 % Q1 2020 Model and Updated VA Equity Interest Asset Asset Q2 results Dividend Q2 2020 Transitional Q2 2020 assumptions stress factor rates return allocation and sub Q2 2020 incl.
Slide 11: SII position Storebrand Group
SII position Storebrand Group Group Solvency position(%)1 Estimated sensitivities Target SII margin 150% 172 163 17 26 SII-margin Q2 137 26 163 155 137 Interest 127 43 170 rates -50bp Interest Q1 2020 Q2 2020 rates +50 bp 149 10 158 Transitional rules SII standard model Equity -25% 129 36 165 Key ta
Slide 12: Storebrand Group
Storebrand Group Group Profit1 Q2 01.01 - 30.06 Full year NOK million 2020 2019 2020 2019 2019 Fee and administration income 1 301 1 235 2 649 2 450 5 308 Insurance result 255 269 184 514 1 005 Operational cost -975 -1 030 -1 999 -1 960 -4 015 Operating profit 580 474 834 1 005 2 298 Financial items
Slide 13: Storebrand Group
Storebrand Group Group Profit1 Q2 01.01 - 30.06 Full year NOK million 2020 2019 2020 2019 2019 Fee and administration income 1 301 1 235 2 649 2 450 5 308 Insurance result 255 269 184 514 1 005 Operational cost -975 -1 030 -1 999 -1 960 -4 015 Operating profit 580 474 834 1 005 2 298 Financial items
Slide 14: Savings (non-guaranteed)
Savings (non-guaranteed) Savings Profit Q2 01.01 - 30.06 Full year NOK million 2020 2019 2020 2019 2019 Fee and administration income 974 911 2 017 1 807 3 996 Operational cost -600 -672 -1 269 -1 287 -2 621 Operating profit 374 239 748 521 1 375 Financial items and risk result life 22 -16 -76 -7 -1
Slide 15: Savings (non-guaranteed) - Strong premium and reserve growth
Savings (non-guaranteed) Savings -Strong premium and reserve growth Reserves and premiums Unit Linked Comments1 5.0 5.1 4.6 ▪ 23% growth in Unit Linked premiums. Continued growth 4.2 4.2 235 despite furloughs in Q2. 220 ▪ 18% growth in Unit Linked reserves. 207 210 198 BNOK ▪ NOK +4.6bn net transfer
Slide 16: Insurance
Insurance Insurance Profit Q2 01.01 - 30.06 Full year NOK million 2020 2019 2020 2019 2019 Insurance premiums f.o.a. 1 070 965 2 090 1 913 3 909 Claims f.o.a. -816 -696 -1 906 -1 399 -2 904 Operational cost -175 -159 -350 -309 -648 Operating profit 80 111 -166 205 357 Financial result 44 28 22 36 83
Slide 17: Insurance - C/R back on track
Insurance Insurance – C/R back on track Combined ratio Comments Combined ratio and results Claims ratio Cost ratio Combined ratio 124% ▪ 92% combined ratio in line with target (90-92%). 96% 92% ▪ Continued strong cost control. 89% 89% 107% 72% 73% 78% 76% 16% 17% 17% 17% 16% Q2 2019 Q3 2019 Q4 2019
Slide 18: Guaranteed pension
Guaranteed pension Guaranteed Profit Q2 01.01 - 30.06 Full year NOK million 2020 2019 2020 2019 2019 Fee and administration income 360 364 710 724 1 475 Operational cost -214 -209 -416 -395 -819 Operating profit 147 155 294 329 657 Risk result life & pensions 50 52 24 113 215 Net profit sharing -205
Slide 19: Guaranteed pension - Strong buffer capital
Guaranteed pension Guaranteed - Strong buffer capital Reserves guaranteed products Comments 262 264 263 272 274 30 30 ▪ Asset returns increase overall level of reserves in the quarter and 33 33 33 the level of buffer capital. 142 143 BNOK 137 137 137 ▪ Guaranteed reserves as a share of total reserve
Slide 20: Other
Other1 Other Profit Q2 01.01 - 30.06 Full year NOK million 2020 2019 2020 2019 2019 Fee and administration income 19 14 32 28 51 Operational cost -39 -45 -75 -78 -143 Operating profit -21 -31 -42 -50 -91 Financial items and risk result life 317 36 -98 146 296 Profit before amortisation 296 5 -141 96
Slide 21: Save the date December 2020
- Save the date 10 December 2020 21
Slide 22: Appendix
Appendix 22
Slide 23: Results
Results 23
Slide 24: Storebrand Group
Storebrand Group Group Profit1 Q2 01.01 - 30.06 Full year NOK million 2020 2019 2020 2019 2019 Fee and administration income 1 301 1 235 2 649 2 450 5 308 Insurance result 255 269 184 514 1 005 Operational cost -975 -1 030 -1 999 -1 960 -4 015 Operating profit 580 474 834 1 005 2 298 Operating profi
Slide 25: Savings (non-guaranteed)
Savings (non-guaranteed) Group Profit Q2 01.01 - 30.06 Full year NOK million 2020 2019 2020 2019 2019 Fee and administration income 974 911 2 017 1 807 3 996 Operational cost -600 -672 -1 269 -1 287 -2 621 Operating profit 374 239 748 521 1 375 Operating profit adjusted for performance related incom
Slide 26: Asset allocation
Asset allocation 26
Slide 27: 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 30.06.2019 8% 26% 3% 52% 10% 0% 30.09.2019 9% 26% 2% 52% 10% 0% 31.12.2019 9% 25% 3% 52% 10% 0% 31.03.2020 3% 28% 8% 50% 10% 0% 30.06.2020 6% 28% 3% 52% 11% 0%
Slide 28: SPP asset allocation
SPP asset allocation 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Alternative Bonds Equities investments 30.06.2019 13% 83% 5% 30.09.2019 12% 84% 4% 31.12.2019 12% 81% 6% 31.03.2020 13% 85% 2% 30.06.2020 13% 85% 2% Note: The graph shows the asset allocation for all products with an interest rate guarantee
Slide 29: High Quality Fixed Income I - Characteristics of Bonds at Amortised Cost
High Quality Fixed Income I - Characteristics of Bonds at Amortised Cost1 Market & book value – no reinvestment (NOKbn) Rating distribution (%) 129 129 123 9 9 112 8 8 88 20% 22% AAA 84 7 7 71 AA 61 0% 6 52 121 120 114 5 A 104 4 44 3 35 BBB 81 77 26 17% 65 3 56 47 2 20% Unrated & BB 40 32 24 Mortage
Slide 30: High Quality Fixed Income II - Characteristics of Mark to Market Fixed Income
High Quality Fixed Income II - Characteristics of Mark to Market Fixed Income1 Rating distribution (%) Geographical distribution2 (%) 19% 21% 19% AAA Europe ex. NO & SWE 36% AA Norway 4% 7% 2% A Sweden BBB Other 14% Unrated & BB US 13% Mortages, Loans & ABS 54% 11% Sector distribution (%) 19% Sovere
Slide 31: Capital and liquidity
Capital and liquidity 31
Slide 32: Strong Group IFRS equity and capital structure - reduced financial leverage
Strong Group IFRS equity and capital structure – reduced financial leverage Group equity (NOK bn) Group capital structure2 42,323 41,980 40,821 35,258 32,873 33,398 32,873 32,567 27,637 27,250 24,741 33,398 32,873 32,873 (79%) (78%) 27,637 (81%) 20,175 24,795 25,748 24,432 24,741 (78%) (75%) (77%) (
Slide 33: Strong liquidity and low leverage
Strong liquidity and low leverage Net liquidity ratio Storebrand ASA (holding) 12% 10% ▪ Proceeds from subsidiaries have been used to pay dividends, reduce debt in the holding company -3% 0% and increase the liquidity buffer -5% -4% -8% -9% -9% -9% -13% -11% -12% ▪ Holding company net liquidity rati
Slide 34: Group Liquidity NOK bn
Group Liquidity NOK bn 5.6 2.21 3.4 0.8 2.6 Liquidity Undrawn RCF Liquidity inc RCF Debt Financed Equity financed Total liquidty inc RCF 1 Revolving Credit Facility of EUR 300 Million, exchange rate 10.88 applied 34
Slide 35: Term structure debt
Term structure debt Term structure sub-debt Storebrand Livsforsikring1 (bn NOK) Term structure senior debt Storebrand ASA (bn NOK) 3.8 Perpetual Non- perpetual 2.1 1.1 1.4 1.0 0.5 0.8 0.3 1.0 2020 2021 2022 2023 2024 2025 2020 2021 2022 2023 2024 2025 1 EUR 300 Million. SEK 750 Million 1,0 BN, 1,0 B
Slide 36: Investor Relations contacts
Investor Relations contacts Lars Aa. Løddesøl Group CFO lars.loddesol@storebrand.no +47 9348 0151 Kjetil R. Krøkje Group Head of Finance, Strategy and M&A kjetil.r.krokje@storebrand.no +47 9341 2155 Daniel Sundahl Head of Investor Relations and Rating daniel.sundahl@storebrand.no +47 9136 1899 This