Sparebank 1 Ostlandet · OSL:SPOL
Sparebank 1 Ostlandet — SpareBank 1 SR-Bank — Q4 2012 Earnings Presentation
47 slides from Sparebank 1 Ostlandet's earnings presentation, Feb 8, 2013
Slide 1: 4th quarter 2012 – Preliminary annual accounts 2012
SpareBank 1 SR-Bank ASA 4th quarter 2012 Preliminary annual accounts 2012 8th February 2013 Page 1
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 SpareBank 1 SR-Bank believes that the expectations reflected in such forward-looking statements are reasonable,
Slide 3: Good results, solid growth in customers and stronger equity
Good results, solid growth in customers and stronger equity Pre-tax profit for 2012 was NOK 1,761 million (NOK 1,495 million) – Return on equity after tax was 12.4 % (11.2 %) Pre-tax profit for the fourth quarter was NOK 458 million (NOK 490 million) – Return on equity after tax was 11.2 % (13.9 %)
Slide 4: Key figures
Key figures Return on equity Core Tier 1 capital 15,5 % 12,4 % 11,2 % 10,0 % 8,7 % 8,3 % 2010 2011 2012 2010 2011 2012 Deposit-to-loan Earnings per share in NOK 6,84 63,2 % 61,7 % 57,4 % 5,42 5,32 2010 2011 2012 2010 2011 2012 Page 4
Slide 5: Income statement
Income statement 31.12 31.12 Group Income Statement (MNOK) 12 11 Q4 12 Q3 12 Q2 12 Q1 12 Q4 11 Net interest income 1.742 1.756 480 448 413 401 448 Net commission and other income 1.466 1.192 411 374 379 302 305 Net income on investment securities 578 319 97 192 87 202 111 Total income 3.786 3.267 98
Slide 6: Key figures
Key figures 31.12 31.12 12 11 Q4 12 Q3 12 Q2 12 Q1 12 Q4 11 Return on equity after tax (%) 12,4 11,2 11,2 13,6 11,8 12,9 13,9 Net interest margin (%) 1,27 1,31 1,36 1,28 1,22 1,21 1,34 Impairment losses on loans and guarantees in % of gross loans 0,13 0,13 0,10 0,16 0,13 0,13 0,18 -incl. SB1 Boligkr
Slide 7: The group's income profile
The group’s income profile 1000 900 800 290 700 286 295 600 291 256 21 34 121 32 MNOK 500 88 7 41 14 84 46 400 300 480 448 448 200 401 413 100 0 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Net interest income Commission income SB1 Boligkreditt and SB1 Næringskreditt Profit before tax SB1 Boligkreditt and SB1 Næri
Slide 8: Lending and deposit margins
Lending and deposit margins Lending margins 2,58% 2,29% 2,34% 2,14% 1,97% 1,98% 2,01% 2,00% 1,97% 1,94% 1,65% 1,71% 1,39% 1,26% 1,19% 1,06% 1,02% 0,99% Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Corporate market Retail market Deposit margins 0,65% 0,69% 0,56% 0,59% 0,50% 0,24% 0,25% 0,14%
Slide 9: Lending volume and growth
Lending volum and 12 months growth Corporate Market 50 000 40 000 15% 11,9 % 11,5 % 10,0 % 9,2 % 30 000 MNOK 7,6 % 10% 6,0 % 20 000 4,8 % 5,0 % 2,6 % 5% 10 000 0 0% Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Volume Growth % Retail Market 120 000 16,9 % 17,1 % 17,1 % 15,8 % 100 000 15% 12,
Slide 10: Loan portfolio as at 31.12.2012
Loan portfolio as at 31.12.2012 Agriculture / forestry / Industry, Power/water supply fishing: 3,0 (2,9) and construction: 3,8 (3,9) Retail trade, hotels and restaurants: 1,9 (1,7) Shipping : 1,2 (1,3) Offshore/Oil and gas: 4,4 (5,0) Retail customers: 33,4 (32,5) Real estate: 15,4 (16,2) Total retai
Slide 11: Loan to value ratio on home mortgage loans
Loan to value ratio on home mortgage loans Total-distributed • There is an increasing proportion of loans within a 70 % loan to value ratio 80% 71,8 % 68,8 % during the last year and a diminishing 60% proportion of loans that have a loan to value ratio exceeding 85 %. 40% 19,3 % 19,6 % 20% • 97.8 %
Slide 12: Deposits volume and growth
Deposits volume and 12 month growth Corporate Market 20,1 % 19,5 % 40 000 20% 16,0 % 30 000 13,3 % 15% MNOK 20 000 6,8 % 10% 3,0 % 2,8 % 3,2 % 2,2 % 10 000 5% 0 0% Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Volume Growth % Retail Market 40 000 20% 15,1 % 13,6 % 13,9 % 13,7 % 30 000 15% 11
Slide 13: Net commission and other income
Net commission and other income 31.12 31.12 MNOK 12 11 Q4 12 Q3 12 Q2 12 Q1 12 Q4 11 Payment facilities 205 205 47 61 50 47 52 Savings/placements 140 136 36 33 36 35 34 Insurance products 156 153 51 36 35 34 53 Commission income real estate (EM1) 427 426 99 105 124 99 106 Guarantee commission 89 78
Slide 14: Net income on investment securities
Net income on investment securities 31.12 31.12 MNOK 12 11 Q4 12 Q3 12 Q2 12 Q1 12 Q4 11 Dividend 25 21 0 1 21 3 1 Investment income, associates 265 209 22 90 53 100 67 Securities gains/losses 130 -48 23 62 -23 68 5 - of which capital change in shares and certificates 61 -35 46 35 -34 14 8 - of whic
Slide 15: Subsidiaries
Subsidiaries MNOK 31.12.12 31.11.12 EiendomsMegler 1 SR-Eiendom AS Number of sales 7.449 7.493 Operating profit before tax 86,4 91,0 SpareBank 1 SR-Finans AS Total assets (BNOK) 6,1 5,4 Operating profit before tax 115,2 99,9 SR-Forvaltning AS Portfolio (BNOK) 6,1 5,9 Operating profit before tax 18,5
Slide 16: Ownership interests
Ownership interests MNOK 31.12.12 31.12.11 SpareBank 1 Gruppen AS (19,5 % interest ownership) Profit after tax 88,0 94,0 Adjusted profit previous years 9,3 1,9 SpareBank 1 Boligkreditt AS (29,9 % interest ownership) Profit after tax 84,3 23,8 SpareBank 1 Næringskreditt AS (28,3 % interest ownership)
Slide 17: Operating expenses
Operating expenses 31.12 31.12 MNOK 12 11 Q4 12 Q3 12 Q2 12 Q1 12 Q4 11 Personnel expenses 1.127 1.052 297 276 279 275 267 Non-recurring effect, pension-related items -45 -224 -5 -5 -35 0 -167 Total personnel expenses 1.082 828 292 271 244 275 100 IT expenses 227 223 59 61 49 58 61 Marketing 81 88 2
Slide 18: Impairment losses on loans and guarantees
Impairment losses on loans and guarantees 31.12 31.12 Losses on loans in income statement (MNOK) 12 11 Q4 12 Q3 12 Q2 12 Q1 12 Q4 11 Corporate customers 161 87 28 44 24 65 -11 Retail customers 6 47 -2 -1 10 -1 35 Change in collective impairment losses on loans -30 5 0 0 0 -30 21 Net impairment losse
Slide 19: Impairment losses on loans
Impairment losses on loans 0,41% 0,38% 0,38% 0,32% 0,23% 98 0,19% 91 0,13% 0,13% 24 0,10% 0,09% 288 277 5 210 167 134 -30 2008 2009 2010 2011 2012 Individual impairment losses on loans, MNOK Collective impairment losses on loans, MNOK Loss ratio in % of average gross loans Loss ratio in % of average
Slide 20: Non-performing and doubtful commitments
Non-performing and doubtful commitments 1,61% 1,33% 1,41% 1,44% 1,31% 1,23% 1,14% 1,10% 1,14% 1,10% 1,14% 0,97% 0,90% 0,94% 0,91% 0,90% 0,76% 0,79% 0,76% 0,79% 909 1.264 860 897 762 787 787 753 696 696 517 564 395 443 415 460 415 444 460 348 2008 2009 2010 2011 2012 31.12.2011 31.03.2012 30.06.2012
Slide 21: Market financing and liquidity management
Market financing and liquidity management Funding maturity over the next 12 months • Good liquidity and good access to domestic and international markets. 3,0 2,5 2,0 BNOK • Issued net new funding of approx. NOK 1,5 10 billion during 2012. 1,0 0,5 0,0 jan. 13 mai. 13 jun. 13 aug. 13 sep. 13 okt. 13
Slide 22: SR-Bank's issues in Euromarket compared with iTraxx Financials
SR-Bank's issues in Euromarket compared with iTraxx Financials iTraxx Crossover 5Y Southern Others 400 Europe 4% Asia Nordics 3% 7% 3% 350 Germany /Austria Switzer- 35 % land 300 6% 250 EUR 5,5 years MS + 105 UK EUR 5,5 years MS + 155 42 % 200 Germany Others /Austria 150 3% 30 % Southern Europe 100
Slide 23: Solvency
Solvency 16 • Core Tier 1 capital coverage at year-end 2012 was 10.0 %. 14 14,6 12,8 13,1 13,5 • Tier 1 capital coverage at year-end 2012 was 12 13,4 12.1 %. 12,4 11,4 12,1 11,9 10 11,1 10,2 10,6 Percentage • Due to the transitional rules, up until 2015 8 the minimum IRB capital adequacy requirement
Slide 24: Towards 2015: Increased solvency through high return on equity
Towards 2015: Increased solvency through high return on equity • Strong track-record of delivering attractive total return to owners 16 – Among the best Nordic performers last 15 years 14 14,6 – Among the best also after the issue of 1,520 mill in 2012 ? 13,4 12,8 13,1 13,5 12 12,4 11,4 12,1 11,1 11
Slide 25: Outlook
Outlook International uncertainty persists - possible negative consequences could also impact the Norwegian economy to a greater extent than we have experienced so far. However, high oil prices, big new oil finds, low unemployment and increasing house building are contributing to a high level of act
Slide 26: Appendix
APPENDIX SpareBank 4 SR-BANK
Slide 27: SR-Bank's activities
SRBANK’s activities Divisions of SpareBank 1 SR- Capital Markets Retail Market Corporate Market Administration & Support Bank ASA Number of man-years: 40 Number of man-years : 519 Number of man-years : 180 Number of man-years : 214 Fully owned companies Number of man-years : 218 Number of man-years
Slide 28: SpareBank 1 Alliance
SpareBank 1 Alliance Owners of the Sparebanken alliance Samspar Samspar Hedmark • All credit decisions are made at the 19.5 % 19.5 % 19.5 % 19.5 % 12.0 % 10.0 % local banks • Economies of scale related to expenses, Products, commissions, dividends IT solutions, marketing and branding Sales, loan por
Slide 29: Our vision: Recommended by customers
Our vision: Recommended by customers Primary objective Financial targets • SpareBank 1 SR-Bank ASA is commited to value • ROE 13-15 % in a normalized market creation in the bank`s core market area • Sustainable contribution to the value creation process • Top 50 % ROE and cost/income in a Nordic ben
Slide 30: 20 largest shareholders as at 31 December 2012
20 largest shareholders as at 31 December 2012 Investor Number Stake Sparebankstiftelsen SR-Bank 79.735.551 31,2 % Gjensidige Forsikring ASA 26.483.470 10,4 % SpareBank 1-stiftinga Kvinnherad 6.226.583 2,4 % Folketrygdfondet 6.132.293 2,4 % Odin Norge 5.513.510 2,2 % Frank Mohn AS 5.372.587 2,1 % Od
Slide 31: Rating
Rating Moody’s Fitch Long-term debt A2 Long-term IDR A- Outlook On review Outlook Stable Outlook Updated 6th December 2012 Updated 24th February 2012 Ratinghistory AAA/Aaa AA+/Aa1 AA/Aa2 AA-/Aa3 A+/A1 Moody's A/A2 A-/A3 Fitch BBB/Baa BB/Ba B 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 201
Slide 32: Balance sheet
Balance sheet Balance sheet (MNOK) 31.12.2012 31.12.2011 Cash and balances with central banks 1.314 263 Balances with credit institutions 1.087 723 Net loans to customers 108.758 100.588 Certificates, bonds and other fixed-income securities 18.677 19.850 Financial derivatives 4.578 3.716 Shares, own
Slide 33: Risk profile of the loan portfolio
Risk profile of the loan portfolio Loan portfolio distributed by risk group • 92.3 % of the bank's loan exposure satisfies the criteria for low and the 100% 92,3 % 91,7 % lowest risk. Expected losses in this 80% portion of the portfolio are very limited 60% at 0.04 %. 40% • Exposure to high or the h
Slide 34: Low concentration of individual LGRs in the lending portfolio
Low concentration of individual LGRs in the lending portfolio Loan portfolio distributed by loss given realisation (LGR) • At the end of the Q4 2012, SpareBank 1 100% SR-Bank had a total of 32 commitments with an individual loss potential 90% exceeding NOK 100 million. 83,3 % 83,0 % 80% • These comm
Slide 35: Risk profile – Lending in the retail market
Risk profile – Lending in the retail market Retail market portfolio distributed by risk group • The quality of the retail market 0,3 % 0,3 % 0,2 % 0,2 % 0,2 % portfolio is considered very good and 100% 1,0 % 1,0 % 0,9 % 0,8 % 0,8 % with low potential losses. 98% 96% • The development is characterise
Slide 36: Loan to value ratio on home mortgage loans (excl Boligkreditt)
Loan to value ratio on home mortgage loans (excl Boligkreditt) Total-distributed • SpareBank 1 SR-Bank has in the last 60% 55,6 % year introduced restrictions to reduce 52,1 % the risk associated with new 50% mortgages. These include stricter 40% mortgage deposit requirements and 30% 28,6 % 27,0 % l
Slide 37: Risk profile – Lending in the corporate market
Risk profile – Lending in the corporate market Development in corporate market’s portfolio distributed by risk group • The quality of the corporate market portfolio is considered to be good. 100% 4,6 % 3,9 % 3,7 % 3,7 % 3,9 % 17,0 % 16,8 % 18,7 % 16,1 % 16,2 % 80% • The risk profile has seen a relat
Slide 38: Low exposure to the shipping segment
Low exposure to the shipping segment • Lending to conventional shipping is low and represents 1.2 % of total loans Product- Dry cargo; 5,2 % /chemicaltanks; (4,3 %) Gas; 3,1 % (3,3 %) 7,6 % (8,1 %) • Lending to the offshore sector Seismic; 6,2 % Other; 3,0 % represents 4.4 % of total loans (7,1 %) (
Slide 39: Lending to property management
Lending to property management • Lending to property management Housing constitutes 15.4 % of total loans, which cooperative; is a reduction of 0.8 % compared with Real estate 5,2 % (6,7 %) management; the same time last year. 3,6 % (2,7 %) • The portfolio is characterised by lending Development and
Slide 40: Risk profile – Lending in the corporate market
Risk profile – Lending in the corporate market Lending to commercial property for rent • The portfolio of commercial property for distributed by risk group rent represents the Group's largest concentration in a single sector and 100% 2,1 % 2,9 % 2,6 % 2,8 % 3,5 % accounts for around 10 % of the tota
Slide 41: Liquidity buffer and bond portfolio
Liquidity buffer and bond portfolio Liquidity buffer – survival period Bond portfolio 22 Of which, 20 securities classified to 18 Market value, amortised cost, 16 Bond investments MNOK Share % MNOK 14 Norwegian government/municipal 10 0% 0 12 BNOK SSA/Foreign guaranteed 2.945 27 % 0 10 Covered bonds
Slide 42: Securities investments
Securities investments Risk profile - bonds • Most of the bond portfolio is managed as part of the bank's liquidity management Total portfolio activities. Bonds held for liquidity Market value Per cent Risk category Rating (incl. unofficial) NOK million Total purposes are generally very low risk. Go
Slide 43: Savings/placements – portfolio development
Savings/placements – portfolio development 14000 • Assets under management of NOK 12,0 billion as at 31 December 2012 — Increase from NOK 11,2 billion as at 12000 31 december 2011 — 53 520 active savings contracts – approximately NOK 44,0 million in 10000 monthly savings 8000 • Most of the assets ar
Slide 44: SRBANK as of 31.12.2012
SRBANK as of 31.12. 2012 Development in Price/Book 2012 Relative share price development 2012 Trading volume development 2010-2012 Page 44
Slide 45: SRBANK as at 31 December 2012
SRBANK as at 31 December 2012 2012 2011 2010 2009 2008 • Ownership interests: –From Rogaland, Agder-counties and Hordaland: 61,2 % Market price 37,20 40,70 57,00 50,00 27,08 –International: 6,0 % –10 largest: 55,3 % –20 largest: 60,7 % Stock value (MNOK) 9.514 5.182 7.257 6.047 2.434 • Number of own
Slide 46: Proposed allocation of profit for 2012
Proposed allocation of profit for 2012 MNOK 2012 • The parent company's available profit that Parent company profit after tax 1.241 provides a basis for paying a dividend. Transferred from reserve for valuation variances 30 • The Board proposes a dividend of NOK 1.50 Available 1.211 per share. Divid
Slide 47: Contact Details
Contact Details Address Management Investor Relations Arne Austreid Vidar Torsøe Bjergsted Terrasse 1 CEO Investor Relations Postboks 250 4066 Stavanger Tel. Tel. +47 900 77 334 +47 970 80 656 Tel. E-mail. E-mail. arne.austreid@sr-bank,no vidar.torsoe@sr-bank.no +47 915 02002 Inge Reinertsen www.sr-