SpareBank 1 Helgeland · OSL:HELG
SpareBank 1 Helgeland — Helgeland Sparebank — Q4 2013 Earnings Presentation
49 slides from SpareBank 1 Helgeland's earnings presentation, 2014
Slide 1: Presentation for the 4th quarter 2013
Presentation for the 4th quarter 2013 A driving force for growth on Helgeland 1
Slide 2: Agenda and presenters
Presentation for the 4th quarter 2013 (HSB group) Main features Jan Erik Furunes Profit & Loss Chief Executive Officer Balance Lending Deposits Lisbeth Flågeng Deputy Chief Executive Officer Funding Solidity Summary Inger Lise Strøm Appendices Chief Financial Officer A driving force for growth on He
Slide 3: Presentation for the 4th quarter 2013 (HSB group)
Presentation for the 4th quarter 2013 (HSB group) Main features Document of goals Profit & Loss Profit Balance& Loss Balance Lending Lending Deposits Deposits Funding Funding Solidity Solidity Summary Summary Appendices Appendices A driving force for growth on Helgeland 3
Slide 4: Profit and loss YTD – historically good result
Main features Profit and loss YTD – historically good result Additionally improved basic operations – gross profit MNOK 266 (172) • Improved profits of MNOK 94 – 55% from 2012 • Net interest increased by MNOK 83 – increased by 23% from 2012 • Net value change on financial instruments increased by MN
Slide 5: Profit and loss YTD
Main features Profit and loss YTD Significantly reduced lending growth: 4.4 (9.3) % - in line with the banks objective • Retail market 7.0 (10.1) % • Corporate market -0,4 (7.9) % Very good deposit growth: 15.9 (7.5) % - deposit ratio 62.7% • Retail market 7.8 (7.8) % • Corporate market 31.1 (6.9) %
Slide 6: Profit and loss for the quarter
Main features Profit and loss for the quarter Improved basic operations also in Q4, no large one-time-effects • Gross profits MNOK 73 (46) • Net interest MNOK 118 (95) - Increased by MNOK 1 from Q3 to Q4 2013 • Costs MNOK 62 (60) - Low costs over time - Gift to employees and ECs to employees in the
Slide 7: Presentation for the 4th quarter 2013 (HSB group)
Presentation for the 4th quarter 2013 (HSB group) Main features Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 7
Slide 8: Income- and key figure developments
Profit & loss statement Income- and key figure developments Helgeland Sparebank Improvement of basic Key figures in % of average BTA operations continues 2,5 % Net interest Net income Net interest • Significantly improved in 2013 Net provision 2,0 % Net commission earnings • Stable income in NOK and
Slide 9: Income- and key figure developments
Profit & loss statement Income- and key figure developments Helgeland Sparebank Improvement of basic Key figures in % of average BTA operations continues 2,5 % Net interest Net income Net interest • Significantly improved in 2013 Net provision 2,0 % Operations costs Net commission earnings Write-dow
Slide 10: Income- and key figure developments
Profit & loss statement Income- and key figure developments Helgeland Sparebank Improvement of basic Key figures in % of average BTA operations continues 2,5 % Net interest Net income Net interest • Significantly improved in 2013 Net provision Operations costs Net commission earnings 2,0 % Write-dow
Slide 11: Profit and loss accounts
Profit & loss statement Profit and loss accounts Helgeland Sparebank (HSB group) 31.12.12 31.12.13 Q4/2012 Q4 2013 Net interest- and credit provision earnings 356 439 95 118 Net provision earnings 72 77 18 20 Other operations income 7 7 3 3 Ordinary operations costs 233 239 60 62 Result basic operat
Slide 12: Profit and loss accounts
Profit & loss statement Profit and loss accounts Helgeland Sparebank (HSB group) Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2014 Net interest- and credit provision earnings 1,54 % 1,55 % 1,73 % 1,82 % 1,79 % Net provision earnings 0,29 % 0,28 % 0,29 % 0,34 % 0,30 % Other operations income 0,05 % 0,02 % 0,03
Slide 13: Costs
Profit & loss statement Costs Helgeland Sparebank Increasing cost Operating cost developement efficiency 70 80,0 % Operations costs in % of 60 total income have had a 70,0 % positive development since 50 2011 60,0 % 40 50,0 % Relatively flat cost 30 development in NOK 40,0 % throughout the last 3 ye
Slide 14: Return on equity
Profit & loss statement Return on equity Helgeland Sparebank Good improvement of Return on equity and target figures return on equity Profit & loss 14 % • So far this year 10.4 (7.2) % • Return on equity in the 4th 12 % quarter was 11.4% 10 % Target figure • 10% under normal 8% market conditions 6%
Slide 15: Main features
Main features Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 15
Slide 16: Balance- and growth development
The balance Balance- and growth development Helgeland Sparebank Reduced lending growth BTA whereby lending (MNOK) Gross lending per 31.12.13: 30 000 NOK 20.7 (19.8) bn. 12-month lending growth: 25 000 MNOK 866 / 4.4 (9.3) % 20 000 3-month lending growth: -0,5 (2.4) % 15 000 83,2 (83.5) % are loans t
Slide 17: Balance- and growth development
The balance Balance- and growth development Helgeland Sparebank Strengthened deposit BTA whereby lending and deposits growth (MNOK) 30 000 Volume per 31.12.13: NOK 12.9 (11.2) bn. 25 000 12-month deposit growth: MNOK 1 778 / 15.9 (7.5) % 20 000 3-month lending growth: 15 000 3.5 (0.9) % Stable depos
Slide 18: Main features
Main features Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 18
Slide 19: Credit growth retail Market
Lending Credit growth retail Market Helgeland Sparebank 12-month growth 12-month credit retail market 7.0 (10.1) % 25 % Normal activity – somewhat lower growth in 2013 20 % Lending to retail customers constitute NOK 13.6 (12.7) bn, mainly well collateralised 15 % mortgages. Increased retail market 1
Slide 20: Credit growth corporate market
Lending Credit growth corporate market Helgeland Sparebank 12-month growth -0,4 12-month credit growth corp. market (7.9) % 25 % The growth in CM has been declining since 2011 20 % Stricter prioritising of 15 % projects in 2013 Reduced lending growth in 10 % line with objective - Off-loading CM 5% -
Slide 21: Gross lending corporate market
Lending Gross lending corporate market Helgeland Sparebank Well diversified lending Lending distributed in sectors portfolio Lending to corporate Real estate customers constitute NOK 7.1 (7.2) bn. Farming and f orestry NOK 2.0 (2.2) bn. are loans Fishery and aquaculture to food production consisting
Slide 22: Defaults and commitments exposed to loss
Lending Defaults and commitments exposed to loss Helgeland Sparebank Good portfolio quality Net defaulted and com. exp. to loss Net non-performing and 250 5,0 % other impaired commitments 4,5 % in % of gross lending - declining since 2008 200 4,0 % - somewhat increased in 3,5 % 2013. 150 3,0 % mnok.
Slide 23: Main features
Main features Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 23
Slide 24: Deposit ratio
Deposits Deposit ratio Helgeland Sparebank Increased deposit ratio Deposit coverage group/parent bank The deposit ratio in the HSB 90 % group was 62.7 (56.5) % Target deposit ratio in the HSB group is 60% 80 % Very good deposit growth in the quarter 70 % 60 % 50 % 2007 2008 2009 2010 2011 2012 2013
Slide 25: Deposit growth retail market
Deposits Deposit growth retail market Helgeland Sparebank 12-month growth 7.8 Deposit growth retail market 12 mth. (7.8) % 25 % Deposits from retail customers constitute NOK 7.9 (7.3) bn. 20 % Growth in retail customers still higher than the national 15 % average New products have been 10 % well rec
Slide 26: Deposit growth corporate market
Deposits Deposit growth corporate market Helgeland Sparebank 12-month growth 31.1 Deposit growth corp. market 12 mth. (6.9) % 35 % Loyal customer base gives good growth in the business 30 % market – still higher than the national average 25 % 20 largest deposits have 20 % been stable over time, 15 %
Slide 27: Customer deposits corporate market
Deposits Customer deposits corporate market Helgeland Sparebank Loyal customer base Customer deposits Of total deposits, NOK 5.1 (3.9) bn. are deposits from Municipalities the corporate market Transport and services Good diversification of Real estate deposits from businesses Construction and power
Slide 28: Main features
Main features Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 28
Slide 29: Loans from the capital market
Funding Loans from the capital market Helgeland Sparebank Good and long term funding Capital market funding structure and maturity Duration on loans is 2.5 (2.3) yrs. 2 500 Liquidity indicator 1 was 110.6% The indicator value for the reference banks was 103.5% at 2 000 30.09.13 Covered bonds constit
Slide 30: Liquidity buffers
Funding Liquidity buffers Helgeland Sparebank Solid buffer capital Securities distributed in sectors The liquidity buffers constitute NOK 4.3 (3.9) bn. equal to 16.4 Goct./LCR 1 (16.0) % of total assets CB 2 The buffer capital consists of CB 1 cash, deposits in BoN/banks and interest bearing assets.
Slide 31: Helgeland Boligkreditt AS
Funding Helgeland Boligkreditt AS Helgeland Boligkreditt AS Good cover pool LTV-alocation as of 31.12.2013 The cover pool: 35,0 % • Qualified loans MNOK 4,698 (4,836) • Deposits: MNOK 239 (274) 30,0 % • Overcollateralization: 23 (19) % 24,4 % • Combined LTV: 52.1 (53.5) % 25,0 % 23,7 % 22,1 % Loans:
Slide 32: Official rating from Moody's
Funding Official rating from Moody’s The bank was given an official rating on the 11th of February • Long term rating Baa2 - After a notch uplift for system support BCA/BSFR • Short term rating P-2 • Stable outlook Official rating an important milestone • Increased regulatory requirements a central
Slide 33: Main features
Main features Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 33
Slide 34: Capital ratio
Solidity Capital ratio Helgeland Sparebank Satisfactory solidity Development in capital adequacy CET1 capital ratio was 12.3 (11.5) 18,0 % % – well above the regulatory requirement of10% from 01.07.14 16,5 % Core capital was 13.9% (13.1) % Total capital ratio was 16.0% 15,0 % (13.2) % – strengthened
Slide 35: Capital structure and capital plan
Solidity Capital structure and capital plan Strengthened earnings Helgeland Sparebank strengthens CET1 capital Development capital adequacy CET1 capital has increased by 18,0 % 78bp since 2012, from 11.5% to 12.3% per Q4 2013 17,0 % 16,0 % The HSB group is on schedule with increasing the capital rat
Slide 36: Allocation of the result 2013
Profit & loss statement Allocation of the result 2013 Helgeland Sparebank Increased cash dividends Allocation of profit 2013 in NOK – lower degree of distribution. 120 Earnings per ECC: NOK 7,03 for parent bank and NOK 100 7,80 for group 98 The Board proposes slightly 80 reduced dividend for 2013 to
Slide 37: 20 largest owners of the EC - HELG
The bank 20 largest owners of the EC - HELG Parent bank Per 31. 12. 13 Numbers % share Numbers % share Sparebankstiftelsen Helgeland 9 599 598 51,3 % Sniptind Holding AS 179 780 1,0 % MP Pensjon PK 902 203 4,8 % Holberg Norge Verdipapirfond 168 600 0,9 % Sparebankstiftelsen v/ Inger-Lise 442 724 2,4
Slide 38: ECC development and Liquidity HELG
The Equity Certificate ECC developement og Liquidity HELG God price development and increased liquidity The price development in Q4 2013 and so far in 2014 has been good and has followed the index. The turnover in HELG has increased from 0.9 million ECs in 2012 to 6.1 million ECs in 2013, whereby 2.
Slide 39: Main features
Main features Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 39
Slide 40: Prospects and priorities
Summary Prospects and priorities Helgeland Market share in % Personal market and corporate market 2013 The bank has a solid position in the market in the Helgeland region: HSB Other • A market share in the retail market of 50-60 % 40-50 % more than 50% • A market share in the corporate market of abo
Slide 41: Prospects and priorities
Summary Prospects and priorities Target oriented work toward the bank’s strategy- and capital plan has succeeded in 2013 and is continued in 2014; profitability and solidity (ROE and capital ratio) • The bank expects continued strong basic operations with a maintained level on - Net interest and - C
Slide 42: Prospects and priorities
Summary Prospects and priorities Nord-Norge Helgeland has a robust and diverse Oil-related turnover (MNOK) labour market: 1600 1437 1359 • Processing- and engineering industry 1400 1311 • Food production on and off shore 1200 • Power production • Governmental institutions 1000 879 736 • Increasing p
Slide 43: Contact information
Contact information Chief Executive Officer Business Address Jan Erik Furunes Helgeland Sparebank (+47) 75 12 83 21 / (+47) 915 70 573 Postboks 68 jan.erik.furunes@hsb.no 8601 Mo i Rana Norway Deputy Chief Executive Officer Internet Lisbeth Flågeng ECCs in general: www.egenkapitalbevis.no (+47) 75 1
Slide 44: Main features
Main features Profit & Loss Balance Lending Deposits Funding Solidity Summary Appendices A driving force for growth on Helgeland 44
Slide 45: Document of goals
Document of goals Financial goals • Return on equity of 10% assuming normal market conditions • CET1 capital ratio of at least 12.5 % and a total capital ratio up toward 18 % given a counter cyclical capital buffer of 2.5 % • Cost growth from 2014 maximum 3.5 % • Deposit ratio of 60 % • The dividend
Slide 46: The local bank – Profitable and leading
The local bank Profitable and leading Helgeland all possibilities – the region is growing both in terms of population and value creation • Helgeland Sparebank’s vision is to be a driving force for growth in Helgeland • The bank’s main goal is to maintain the position as a profitable and leading bank
Slide 47: A driving force for growth
The local bank A driving force for growth Norway’s 12th largest savings bank of 110 banks – 15 offices in 13 municipalities in the Helgeland region ✓ Bank total assets of NOK 26 billion and a market share of 50% • An independent regional bank with no alliances and quoted on the stock exchange - The
Slide 48: Business development and ownership
The local bank Business development and ownership Subsidiaries and associated companies 100 % 8% 34% 6,5 % 48% 10 % A driving force for growth on Helgeland 48
Slide 49: Management and organisational structure
The local bank Management and organisational structure The bank’s Gift fund General manager Geir Sætran A driving force for growth on Helgeland 49