Kvika Banki Hf · OMXICE:KVIKA
Kvika Banki Hf — Q1 2022 Earnings Presentation
16 slides from Kvika Banki Hf's earnings presentation, May 12, 2022
Slide 1: 3M 2022 Financial Results
Kvika banki hf. 3M 2022 Financial Results 12 May 2022
Slide 2: Disclaimer
This presentation and the information contained therein has been prepared by Kvika banki hf. on a best knowledge basis. Any statements or assumptions are set forth by Kvika alone and not by any third party. Forward looking statements may deviate from what is presented in this presentation, e.g. due
Slide 3: Q1 2022 highlights and updated outlook
PBT fully in line with Group budget for the quarter. PAT amounts to ISK 1,510 million Well above regulatory requirements. Strong LCR largely attributable to debt issuance and increase in deposits, prepayment of Lykill debt later in May Divestment of funds managed by KKV (ISK 23 bn.), which has now b
Slide 4: Moody's assigns investment grade ratings of Baa2/Prime-2
Moody’s assigns investment grade ratings of Baa2/Prime-2 ▪ Moody’s has assigned a first time investment grade Baa2 long-term and P-2 short-term foreign and local currency bank deposit and issuer ratings to Kvika banki hf. The ratings carry a stable outlook and are comparable to other domestic banks
Slide 5: Acquisition of majority share in Ortus completed
Acquisition of majority share in Ortus completed ▪ The Group has completed the acquisition of a majority share in Ortus Secured Finance in the UK ▪ Following the acquisition, Kvika’s UK operations will be reported within the Group as a separate operating segment, UK, consisting of the operations of
Slide 6: Demonstration of the value of diversified operations
Demonstration of the value of diversified operations ▪ Kvika’s profit before tax for the first three months of 2022 is ISK 1,740 PBT development / ISK m. Net operating income by segment / Q1 2022 million with a RoTE of 16.1% TM Kvika Asset Management Insurance UK 2) ▪ The Group’s focus on diversific
Slide 7: Return on weighted tangible equity of 16.1% during the quarter
Return on weighted tangible equity of 16.1% during the quarter ISK m. ISK m. ISK m. Loan book composition, indexation and favorable track in funding Performance fully in line with budget despite challenging markets Strong recurring fee base and less reliance on variable fees continue to impact NII,
Slide 8: Solid performance across segments
Solid performance across segments FROM 3M 2021 to 3M 2022 / ISK m. ISK m. 3M 2022 3M 2021 Net interest income 1,571 634 166 Net fees and commissions 1,642 1,684 435 28 Net premiums and claims 717 - Net financial income 808 373 717 Income from associates - (28) Other income 205 39 937 Net operating i
Slide 9: Combined ratio of 101.0% in Q1 2022
Combined ratio of 101.0% in Q1 2022 ▪ Combined ratio for Q1 2022 of 101.0%, 1.5 percentage points (%) (%) decrease from Q1 2021 5% 5% 5% 3% 13% ▪ Claims ratio increases from Q1 13% 23% 12% 23% 13% 26% 22% 2021, major claims ratio 6% 7% 8% 6% significantly lower than in Q1 Q1 2021 Q1 2022 Q1 2021 Q1
Slide 10: Return on investment of 0.7% in Q1 2022
Return on investment of 0.7% in Q1 2022 (Q1 2021: 5.6%) ▪ Return on investment assets in Q1 of 0.7%, a positive outcome during ISK m. 31.3.2022 / ISK m. difficult market circumstances ▪ Positive performance in most asset 1,713 Cash and term deposits 3,896 classes, with listed equities being 1,291 Bo
Slide 11: Increase in assets mainly attributable to acquisition of Ortus
Increase in assets mainly attributable to acquisition of Ortus ▪ ISK 40.0 billion increase in assets since year-end 2021 driven by 31.12.2020 to 31.3.2022 / ISK bn. 31.3.2022 / ISK bn. increased cash position and loan book Cash and balances with Central Bank Liquid assets ISK 120 billion growth, as
Slide 12: Increased diversification of loans to customers
Increased diversification of loans to customers ▪ Loan book increases by ISK 11.5 bn. since year-end 2021, Book value / 31.3.2022 / ISK bn. 31.3.2022 / ISK bn. 83.1 mainly due to the acquisition of 2.1 3.3 a majority share in Ortus 6.5 Secured Finance 2.5 1.4 12.0 Real estate 3.3 3.1 2.2 1.4 1.6 2.1
Slide 13: Increase driven by first international bond issuance and Ortus acquisition
Increase driven by first international bond issuance and Ortus acquisition ▪ Liabilities increase by 41.3 billion 31.12.2020 to 31.3.2022 / ISK bn. 31.3.2022 since year-end 2021, driven by debt 4.6% issuance and increase in borrowings Debt issuance 1.5% 11.4% ▪ Increased borrowings are mainly Borrow
Slide 14: Consolidated solvency and capital adequacy ratios well above regulatory requirements
Consolidated solvency and capital adequacy ratios well above regulatory requirements ▪ Capital adequacy is calculated on a 31.3.2022 / ISK bn. 31.3.2022 consolidated level as the solvency ratio of the financial conglomerate Minimum regulatory requirement Total own funds ▪ The consolidated capital ad
Slide 15: PBT outlook next 12 months: ISK 8,700-9,700 million
PBT outlook next 12 months: ISK 8,700-9,700 million ▪ At the end of each quarter the Group PBT Outlook Next 12M: 8,700 - 9,700 ISK million RoTE: 19.9% - 22.2% revises key assumptions for the next four quarters and updates previously reported outlook as required as well as PBT Outlook FY2022: 8,400-9
Slide 16: Confidential
Confidential