Swedbank Ab Class A · OMXSTO:SWED_A
Swedbank Ab Class A — Q1 2018 Earnings Presentation
19 slides from Swedbank Ab Class A's earnings presentation, 2018
Slide 1: Swedbank's first quarter 2018 results
Swedbank’s first quarter 2018 results Birgitte Bonnesen (CEO), Anders Karlsson (CFO), Helo Meigas (CRO) © Swedbank Information class Public
Slide 2: Swedish Banking: Good loan volume growth
Swedish Banking Good loan volume growth SEKm Q1 18 Q4 17 ▲QoQ • Net interest income Net interest income 3 877 3 861 16 – Continued mortgage loan volume growth and Net commission income 1 884 1 960 -76 slightly higher margins Other income 483 625 -142 – Corporate loan volume growth Total income 6 244
Slide 3: Baltic Banking: Diversified loan volume growth
Baltic Banking Diversified loan volume growth SEKm Q1 18 Q4 17 ▲QoQ • Net interest income Net interest income 1 103 1 116 -13 – Lending growth to both households and Net commission income 593 711 -118 corporates Other income 209 226 -17 – Mixed margins Total income 1 905 2 053 -148 Total expenses 66
Slide 4: Large Corporates & Institutions: Stable result
Large Corporates & Institutions Stable result SEKm Q1 18 Q4 17 ▲QoQ • Stable net interest income Net interest income 930 934 -4 • Net commission income Net commission income 621 656 -35 Net gains and losses 564 333 231 – Lower asset management, brokerage and custody incomes Other income 22 42 -20 To
Slide 5: Group results: High customer activity
Group results High customer activity SEKm Q1 18 Q4 17 ▲QoQ • Loan volume growth strengthened net Net interest income 6 294 6 326 -32 interest income, mitigating higher resolution Net commission income -254 3 081 3 335 fund fee and fewer days Net gains and losses 559 356 203 Other income 806 959 -153
Slide 6: Strong capitalisation – no excess capital
Capital Strong capitalisation – no excess capital CET1 capital ratio, % 24.6% 24.6% 24.8% • CET1 capital increased by SEK 1.4bn 23.9% 22.0% – Positive effect from net profit of SEK 1.7bn excl. dividend – Negative effect from IAS19 of SEK 0.1bn – IFRS 9 implementation reduced CET1 capital by SEK 0.4b
Slide 7: Increased Risk Exposure Amount (REA)
Capital Increased Risk Exposure Amount (REA) REA, SEKbn 1.3 • REA increased by SEK 2.4bn 0.9 4.5 410.8 – Increased credit exposures offset by 408.4 -3.0 model adjustment in Baltic Banking -1.3 – Higher market exposures – IFRS 9 implementation reduced REA by SEK 0.7bn Q4 2017 Credit risk Market risk
Slide 8: Solid asset quality
Group Solid asset quality Credit impairments, SEKm Q1 18 Q4 17 ▲QoQ • Resilient asset quality in all business Swedish Banking 253 264 -11 segments Baltic Banking -26 -12 -14 Large Corporates & Institutions -100 59 -159 • IFRS 9 effects Swedbank Group 127 311 -184 Ratios Q1 18 Q4 17 Credit impairment
Slide 9: Appendix
Appendix © Swedbank Information class Public
Slide 10: Swedbank has a low-risk residential property portfolio
Swedish Swedbank has a low-risk residential property housing and mortgage portfolio market Real estate lending, net loans in Sweden, SEKbn 1 200 • Swedbank has pursued a low risk • Private mortgages: SEK 770bn, average strategy by tightening origination 1 000 LTV 55% standards, and prioritising pric
Slide 11: Residential property developers - low exposure
Swedish Residential property developers - low exposure housing and mortgage market • Total loan portfolio of SEK 17bn, mainly to the larger listed construction firms, with which Swedbank has long-term relations – SEK 10bn of the loans are related to tenant-owner rights projects • 90% of these projec
Slide 12: Swedbank – low-risk bank with strong capital
Swedbank – low-risk bank with strong capital This is Swedbank base • Low risk – a Board of Directors’ strategic priority – ensures access to funding markets and low funding cost • Retail profile and four home markets a key feature Liquidity & capital, % NSFR LCR* CET1 ratio, CRDIV (RHS) – Around 86%
Slide 13: Swedbank – strong and stable earnings
Swedbank – strong and stable earnings This is Swedbank capacity • Four home markets – Sweden, Estonia, Latvia and Lithuania – Strong and stable economies – Market-leading position in all home markets – Largest customer base in all home markets • Retail profile ensures stable earnings with low volati
Slide 14: Swedbank – market leader in cost efficiency
Swedbank – market leader in cost efficiency This is Swedbank • Best-in-class cost efficiency – an executive management strategic priority • Executive management strongly focused on cost and change management Total expenses, SEKm − Integrated in corporate culture 20 Acquisition of Sparbanken… − Focus
Slide 15: Focus on sustainable business
Focus on sustainable business Improved sustainability scores Green bonds – Swedbank taking the lead Swedbank ran the books of 7 green bond deals, a total volume of USD 528m in the first Dow Jones quarter of 2018. Through the dedicated work of Swedbank’s Large Corporates & Institutions, we have taken
Slide 16: Swedbank creates value
Swedbank creates value Strategy % SEK Return on Equity 30 14 >15% target 25 12 20 10 15.4% 8 15 Common Equity Tier 1 ratio 6 10 One of the highest among European banks 4 5 2 24.8% 0 0 2013 2014 2015 2016 2017 Q1 2018 Dividend per share Return on equity (LHS) CET1 capital ratio (LHS) 75% payout ratio
Slide 17: Conservative funding position
Conservative funding position Liquidity and funding • LCR 140% (EU 2015/61) • NSFR 110% (Basel committee) • Issued around SEK 40bn of term funding in Q1 2018 • Plan to issue around SEK 145bn in 2018 Term funding issuance – completed and planned SEKbn Prefunded for more than 12 months SEKbn 800 100 C
Slide 18: Long-term funding maturity profile
Long-term funding maturity profile Liquidity and funding Long-term funding maturity profile, by funding source Long-term funding maturity profile, by currency SEKbn SEKbn Senior unsecured debt Covered bonds 200 200 150 150 Other GBP 100 100 USD EUR SEK 50 50 0 0 2018 2019 2020 2021 2022 2023 2024- 2
Slide 19: Real-estate price performance – Sweden
Swedish Real-estate price performance – Sweden, housing and mortgage 12 month market Single-family homes1 Tenant-owner rights2 Combined3 12M Δ 12M Δ 12M Δ Apr 17 8% 8% 8% May 17 8% 9% 9% Jun 17 9% 10% 10% Jul 17 10% 9% 9% Aug 17 10% 8% 9% House price index, Sweden 2005=100 Sep 17 8% 4% 7% 350 Total