Slide 1: Storebrand Result Q2 2010
Storebrand Result Q2 2010 15 July 2010 Idar Kreutzer - CEO Odd Arild Grefstad - CFO
Slide 2: Highlights Q2 2010
Highlights Q2 2010 RESULT Group result of NOK -39 mill in Q2, 239 mill YTD Falling equity markets and reservation for longevity gives negative result effects Good risk and administration results OPERATIONS Operational improvement programme ahead of schedule Reduced costs Competitive retu
Slide 3: Storebrand Group
Storebrand Group Q2 01.01. - 30.06 Full year NOK mill. 2010 2009 2010 2009 2009 Life and Pensions Norway 92 286 259 158 759 Life and Pensions Sweden (SPP) -168 216 -55 -304 487 Asset management 42 33 96 65 240 Storebrand Bank 35 6 63 15 63 P&C and health insurance 15 3 -11 -20 -18 Storebrand ASA / o
Slide 4: Delta One - operational improvements in all business areas
Delta One - operational improvements in all business areas Achieved improvement 1H 20101 Target improvements in 20101 MNOK 550 30 MNOK 270 190 MNOK 240 MSEK 210 40 110 Realised Target 2010 Other Life and Pensions Norway Life and Pensions Sweden Asset Management Bank 1. Result improvement, measured a
Slide 5: Life and Pensions Norway - strong improvement in the administration results
Life and Pensions Norway - strong improvement in the administration results 01.01. - Full Q2 30.06 year Turbulent financial markets NOK mill. 2010 2009 2010 2009 2009 Positive administration Administration result 13 -64 -7 -112 -169 results Risk result 95 3 146 117 229 Good risk results Financ
Slide 6: Life and Pensions Norway - good cost development
Life and Pensions Norway - good cost development Cost / customer funds Administration result 1.20 % 100 1.06 % 1.00 % 0.88 % 1.01 % -100 2006 2007 2008 2009 2Q 2010 0.80 % 0.86 % -300 0.77 % 0.60 % -500 0.40 % -700 2006 2007 2008 2009 1H 2010 Tot adm res Adm res to owner 6
Slide 7: Life and Pensions Norway - good market activity and positive transfer balance
Life and Pensions Norway - good market activity and positive transfer balance Strategically important contract renewed to 2016 Framework agreement includes all 20 000 member companies in NHO1 3 000 companies with 70 000 employees has today their pension contract with Storebrand Accumulated net
Slide 8: Life and Pensions Sweden (SPP) - financial turbulence leads to weak finance result
Life and Pensions Sweden (SPP) - financial turbulence leads to weak finance result Strong improvements in Q2 01.01. - 30.06 Full year administration results NOK mill. 2010 2009 2010 2009 2009 Low sick leaves in Sweden Administration result 27 -39 35 -60 -101 leads to strong risk results Risk res
Slide 9: Life and Pensions Sweden (SPP) - strong development in administration results
Life and Pensions Sweden (SPP) - strong development in administration results Administration results Targeted administration result of SEK 300 mill in 2011 50 0 Measures implemented to 2008 2009 1H 2010 increase revenues and -50 reduce costs -100 Costs in % of customer -150 funds at 0.73% 1H 2
Slide 10: Life and Pensions Sweden (SPP) - good sales of Unit Linked
Life and Pensions Sweden (SPP) - good sales of Unit Linked Unit Link as % of total sales1 61% increase in sales of 100 % Unit Linked Q2 2010 compared to Q2 2009 75 % 50 % 13% increase in premiums 71% 71% from UL 1H 2010 25 % 55% of all premiums are 0% within Unit Link 1Q 2007 2Q 2007 3Q 2007 4
Slide 11: Asset management - good growth and high quality of earnings
Asset management - good growth and high quality of earnings 01.01. - Full Q2 30.06 year Strong revenue increase NOK mill. 2010 2009 2010 2009 2009 Good cost control Total income * 108 99 220 199 586 Total costs -95 -85 -181 -169 -429 Turbulent financial markets Net financial/other 28 19 57 35
Slide 12: Asset management - several external discretionary mandates won
Asset management - several external discretionary mandates won Asset under management AuM increased with 6 bn in weak 384 financial markets in Q2 351 70 68 New sales to institutional clients 44 36 of 4.4 bn in AuM 29 227 229 217 29 205 23 25 30 Net subscriptions in mutual Bn NOK 20 36 28 29 30
Slide 13: Storebrand Bank - improved results and solid balance sheet
Storebrand Bank - improved results and solid balance sheet Cyclical conditions ― Low losses ― Decrease in non- 01.01. - Full performing loans Q2 30.06 year NOK mill. 2010 2009 2010 2009 2009 Announced initiatives give Net interest income 125 93 231 214 423 effect: Net fee and ― Reduced costs 18
Slide 14: Storebrand P&C - good growth and strengthened result
Storebrand P&C - good growth and strengthened result 01.01. - Full Q2 2010 30.06 year Stabile and satisfactory NOK mill. 2010 2009 2010 2009 2009 growth Premiums earned, 96 65 183 122 278 net1 Claims ratio 72% in Q2 Claims incurred, net -69 -54 -173 -104 -230 Operation costs excl -23 -20 -43 -43
Slide 15: Storebrand - increased focus on direct distribution
Storebrand - increased focus on direct distribution Insurance– all products available on the web Increase in e-commerce, also in financial services Sole provider of online sale and service solutions for all Kritisk sykdom insurance and savings products Dødsfallskapital New solutions for mobile
Slide 16: Life and Pensions Norway - reservation for longevity affects the results
Life and Pensions Norway - reservation for longevity affects the results Defined Individual Group contribution and paid- defined and Risk up Company 01.01. - NOK mill. benefit * unit linked* products policies** portfolio Q2 30.06 Administration result 2 14 -14 11 13 -7 Risk result 41 46 14 -6 95 146
Slide 17: Life and Pensions Norway - risk adjusted asset allocation
Life and Pensions Norway - risk adjusted asset allocation Allocation - defined benefit Allocation - all portfolios with standard portfolios interest rate guarantee 100 % 1,6 % 1,8 % 1,6 % 1,6 % 1,9 % 2,2 % 90 % 15,6 % 16,0 % 16,2 % Equity 4 % (4%) 12 % 2% (2%) (13%) 80 % Bonds 16 % 70 % 20,0 % (16%)
Slide 18: Life and Pensions Norway - use of customer buffers
Life and Pensions Norway - use of customer buffers 170% 167% 161% 163% 154% 3,8% 148% 0,8% 3,1% 3,0% 2,7% 2,0% 2,2% 1,7% Q1 2009 Q2 2009 Q3 2009 Q4 2009 Q1 2010 Q2 2010 * Marked Value Adjustment Reserve in % of customer funds Additional Statutory Reserves in % of customer funds * Solvency Margin Sto
Slide 19: Life and Pension Sweden (SPP) - active risk management
Life and Pension Sweden(SPP) - active risk management Development equity markets 110 105 Financial markets 100 − Increased swap and credit 95 -1,5% spreads 90 − Reduced interest rate level -11,2% 85 − Volatile and weak equity markets 80 31.3.10 30.4.10 31.5.10 30.6.10 Balance sheet effects OMX M
Slide 20: Life and Pension Sweden (SPP) - reduced risk exposure
Life and Pension Sweden(SPP) - reduced risk exposure Asset allocation by sub portfolio Reduced equity exposure 4% − DB reduced by 5% 7% 7% − P250 reduced by 6 % 10 % − P300 reduced by 4 % 50 % − P520 reduced by 2% 70 % 72 % Alternative Investments 91 % Return 1H: Interest bearing − DB: 3.3% 40 %
Slide 21: Solvency II - notable changes in the QIS 5 framework
Solvency II - notable changes in the QIS 5 framework Key Solvency II QIS 5 ”proposal” issues SCR Reduced equity stress (39%) Use swap rate Discounting of liabilities Macro extrapolation for beyond liquid point Possibility for liquidity premium Value of in-force counts as Tier 1 Included in
Slide 22: Summary
Summary Challenging financial markets Operational improvement programme ahead of schedule Strong administration results Positive net transfers Solid balance sheet and active risk management 22
Slide 23: Storebrand shall be the leading and most respected institution in the Nordic market
Storebrand shall be the leading and most respected institution in the Nordic market for long-term savings and insurance. 23