Nordea Bank Abp · OMXHEX:NDA_FI
Nordea Bank Abp — Debt Investor Presentation (2025)
38 slides from Nordea Bank Abp's debt investor presentation, 2025
Slide 1: Debt investor presentation Q4 2024
Debt investor presentation Q4 2024
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 Nordea believes that the expectations reflected in such forward-looking statements are reasonable, no assurance
Slide 3: Table of contents
Table of contents 1. Quarterly update 4 2. Credit quality 14 3. Capital, liquidity and funding 21 4. Macroeconomy 33 3
Slide 4: 1. Quarterly update
1. Quarterly update Nordea
Slide 5: Executive summary: Fourth-quarter highlights 2024
Fourth-quarter highlights 2024 Executive summary Continued income growth - Total income up 1%. Net interest income down 5%, net fee and commission income up 8% and net fair value result up 31% - Operating profit up 4%, to EUR 1.5bn RoE* 14.3% (14.1% Q423) and EPS EUR 0.32 (0.31 Q423). FY24 RoE 16.7%
Slide 6: Net interest income: higher volumes and lower deposit margins
Net interest income Higher volumes and lower deposit margins, as expected Year-over-year bridge, EURm • Net interest income down 5% -5% 1,946 42 • Lending and deposits up 199 19 30 1,854 89 13 - Mortgages up 6% (1% excluding Norwegian acquisition) - Corporate lending up 1% Q423 Volumes Margins Depos
Slide 7: Net interest income sensitivity to policy rate changes
Net interest income sensitivity Net interest income sensitivity to policy rate changes Sensitivity to +50bp parallel shift in policy Deposit hedge – nominal volume, • NII impact largely driven by policy rates*, EURm EURbn rates and pass-through ~75–125 36 34 33 - Actual pass-through varying between
Slide 8: Net fee and commission income
Net fee and commission income Continued growth; higher savings and payment & card income Year-over-year bridge, EURm +8% • Net fee and commission income 825 up 8% 0 5 0 0 14 43 • Savings fee income up with higher 763 assets under management - AuM up 11%, to EUR 422bn Q423 Asset Brok. & Pay. & Lendin
Slide 9: Net fair value result
Net fair value result Higher customer activity and valuations Net fair value result, EURm +31% • Strong customer risk 291 284 management activity, mainly in 31 247 22 FX and rates products 0 17 35 6 201 154 7 • Market-making down, driven by wider spreads and higher bond market volatility 241 245 225
Slide 10: Costs in line with plan
Costs Costs in line with plan Year-over-year bridge, EURm +1% • Total costs up 1%, driven by 3 5 112 investments and inflation 8 177 1,417 76 1,434 - Underlying costs up 5%, driven by salary reviews, technology running costs, and marketing activities - Investments in technology Q423 Underlying Norwe
Slide 11: Sustainability at the core
Sustainability at the core Our long-term sustainability objectives supported by short term targets Our sustainability objectives CO2 Become a net-zero emissions bank by 2050 at the latest Gender balance 40-50% 50% reduction in emissions across investment and lending portfolios reduction in emissions
Slide 12: Continued progress on climate targets in our lending portfolio
Sustainability at the core Continued progress on climate targets in our lending portfolio 2024 progress 40-50% reduction in financed emissions in our lending portfolio by 20301 -36% Sector Sub-sector Emissions scope Metric Base year Baseline Target year Target Residential real Households and tenant-
Slide 13: Actively engaging to drive transition and capture growth opportunities
Sustainability at the core Actively engaging to drive transition and capture growth opportunities Channelling capital towards sustainable solutions Green and sustainability-linked loans Nordea Asset Management • Facilitated EUR 185bn in Total volumes, EURbn 13.3% 13.0% Assets under management, EURbn
Slide 14: 2. Credit quality
2. Credit quality Nordea
Slide 15: Well diversified pan-Nordic financial service provider
Credit portfolio Well diversified pan-Nordic financial service provider Corporate lending 0.6% Accomodation and leisure 0.7% Power production Household lending 0.8% Land transportation 24% 0.8% IT services 32% 0.8% Consumer durables 0.9% Fishing and aquaculture 0.9% Crops, plantations and hunting Le
Slide 16: Continued strong credit quality
Net loan losses and similar net result Continued strong credit quality • Total net loan losses and similar net result EUR 54m (6bp) Net loan losses and similar net result, EURm - Continued moderate level of loan losses - Individual provisions and write-offs driven -29 by small number of corporates,
Slide 17: Positive evolution in strong credit portfolio
Impairments and provisioning coverage Positive evolution in strong credit portfolio • Stage 2 loans down EUR 2.2bn, Stage 2 and 3 loans at amortised cost, EURm to 6% Stage 2 - Driven by favourable macro Stage 3 development 19,469 19,092 18,541 16,207 16,366 • Stage 3 loans slightly up (+EUR 88m), bu
Slide 18: Well-diversified portfolio, high-quality lending
Credit portfolio – real estate management industry (REMI)* Well-diversified portfolio, high-quality lending Lending volumes stable Diversified across countries • Well-diversified portfolio across 31 32 31 32 32 Finland Nordic markets 6 6 6 6 6 18% Sweden • 90% of exposure towards low- 37% risk custo
Slide 19: Solid LTVs, resilient interest coverage, high occupancy
Credit portfolio – real estate management industry (REMI)* Solid LTVs, resilient interest coverage, high occupancy Solid LTV levels for all countries Majority of portfolio with low LTV • 86% of exposures with LTV below 60% 67 54 64 63 63 64 45% - In event of 20% decline in market 51 51 51 50 32% 35%
Slide 20: Low levels of risk exposure
Credit portfolio – real estate management industry (REMI)* Low levels of risk exposure Strong credit quality, with 93% of IFRS 9 No REA impact even from 3-notch portfolio in stage 1 downgrade due to risk weight floors 50% RW floor • Continued strong credit quality, 8% 50% with slight improvement 6%
Slide 21: 3. Capital, liquidity and funding
3. Capital, liquidity and funding 21
Slide 22: Significant buffer to capital requirements
Capital Significant buffer to capital requirements • CET1 capital ratio 15.8% - 2.2 percentage points above regulatory Capital position and requirements (%) requirement, corresponding to a CET1 buffer of EUR 3.4bn 3.3% 21.0% • CET1 requirement - CET1 requirement increased with ~10bp 2.2% 17.8% due t
Slide 23: Strong capital position; share buy-backs in progress
Capital • CET1 capital ratio 15.8% Strong capital position; share buy-backs in progress - 2.2 percentage points above regulatory requirement - EUR 0.3bn increase in CET1 capital, CET1 capital ratio development, % mainly driven by profit net of dividend, partly offset by share buy-back 15.8 0.7 -0.3
Slide 24: Strong capital generation supporting returns
Capital excellence Strong capital generation supporting returns Shareholder returns supported by continued strong capital generation EUR ~17-18bn Year Average quarterly capital generation, bp • Capital return commitment reaffirmed Share buy-backs - Strong capital generation - Unchanged dividend poli
Slide 25: Strong balance sheet structure
Balance sheet Strong balance sheet structure Q4 2024 • Total assets EUR 623bn Q4 Other assets Other liabilities 2024 Derivatives - Strong balance sheet with Derivatives deposits as primary source of Cash and balances Funding <1 year Short-term funding with central banks funding Liquid assets - Long-
Slide 26: Strong liquidity position
Liquidity Strong liquidity position Liquidity buffer composition, EUR 112bn Currency split Asset split • Robust liquidity position - Liquidity coverage ratio (LCR) 157% 4% 15% SEK - Net stable funding ratio (NSFR) 124% 31% Level 1 cash & central bank EUR 29% 12% 45% USD Level 1 excl. covered bonds L
Slide 27: Nordea global issuance and strong ratings
Long term funding Nordea global issuance 3% 2% 2% 2% 8% 4% 2% 3% 4% Strong ratings 81% Nordea Bank Abp 90% • Moody’s Aa3 (positive outlook) NOK SEK • S&P AA- (stable outlook) 96% (EUR 22bn eq.) (EUR 32bn eq.) • Fitch AA- (stable outlook) DKK 6% 18% (EUR 53bn eq.) 20% 22% 18% 22% 30% 7% 25% 6% 43% 36
Slide 28: Solid funding operations
Wholesale funding Solid funding operations Total wholesale funding, EUR 196bn 4% • Long-term issuance* 5% CD & CP above 1Y 20% 7% CD & CP below 1Y - EUR 2.5bn issued during Q4 Scandinavian covered bonds - EUR 1.7bn in covered bonds and EUR 0.8bn in senior format 4% EUR covered bonds - EUR 19.4bn iss
Slide 29: Enhanced focus on sustainable funding
IFR Sustainability at the core Sustainable Issuer of the Enhanced focus on sustainable funding Year Nordea’s green bond asset portfolio • EUR 22.7bn assets available for green funding** Green buildings - EUR 9.1bn in NBAbp green bond asset portfolio 2% - EUR 13.6bn available assets for green covered
Slide 30: Nordea covered bond operations
Covered bonds Nordea covered bond operations Nordea Eiendomskreditt Nordea Hypotek Nordea Kredit Nordea Mortgage Bank Four aligned covered bond issuers with complementary roles Data as per Q3 Legislation Norwegian Swedish Danish Finnish Cover pool assets Norwegian residential Swedish residential Dan
Slide 31: Nordea 2024 benchmark transactions
Funding transactions Nordea 2024 benchmark transactions Issuer Type Currency Amount (m) FRN / Fixed Issue date Maturity date First call date Nordea Bank Tier 2 NOK 2,750 FRN Nov-24 May-35 Feb-30 Nordea Eiendomskreditt Covered, Green NOK 7,000 FRN Nov-24 Nov-29 Nordea Bank Senior non-preferred, Green
Slide 32: MREL positions and requirements
Minimum requirements for own funds and eligible liabilities MREL positions and requirements Subordinated MREL Subordinated MREL – 3.2 pp above requirement % REA +3.2% – Outstanding senior non-preferred (SNP) of 30.2% EUR 14.7bn 27.0% 9.2% Total MREL 8.2% +1.2% – 4.1 pp above requirement % REA 21.0%
Slide 33: 4. Macroeconomy
4. Macroeconomy Nordea
Slide 34: Better outlook ahead
Nordic economic development Better outlook ahead GDP Unemployment rate GDP, % y/y, Economic Outlook January 2025 • The Nordic economies have shown mixed trends on the back of surging inflation and higher interest rates Country 2023 2024 2025E 2026E • Lower interest rates are expected to support econ
Slide 35: Less restrictive monetary policy
Nordic economies Less restrictive monetary policy Policy rates Public balance/debt, % of GDP, 2025E (IMF) • The ECB and Danmarks Nationalbank lowered their policy rates by 0.25 percentage points in March. The Riksbank and Norges Bank left their policy rates unchanged • The Riksbank is expected to le
Slide 36: Increasing purchasing power
Households Increasing purchasing power Household debt Household savings Private consumption • Households’ purchasing power and consumption are expected to improve as real disposable income continues to increase • Consumer confidence have risen from very low levels but remains subdued, indicating cau
Slide 37: Increased activity
Housing markets Increased activity Home prices Households’ credit growth • Home prices have stabilised and modestly started to increase in most of the Nordic countries. Norwegian home prices have developed better than their Nordic counterparts and rose by 7.6% year-on-year in February 2025 • Monetar
Slide 38: Contacts
Contacts Investor Relations Ilkka Ottoila Maria Caneman Juho-Pekka Jääskeläinen Head of Investor Relations Head of Debt IR and Ratings Senior IR Officer Tel: +358 9 53 00 70 58 Tel: +46 10 156 50 19 Tel: +358 9 53 00 64 35 Ilkka.ottoila@nordea.com Mobile: +46 768 24 92 18 Mobile: +358 40 550 91 11 m