Storebrand Asa · OSL:STB

Storebrand Asa — Q4 2009 Earnings Presentation

27 slides from Storebrand Asa's earnings presentation, Feb 17, 2010

  1. Slide 1: Storebrand Result Q4 2009

    Storebrand Result Q4 2009 17 February 2010 Idar Kreutzer - CEO Odd Arild Grefstad - CFO

  2. Slide 2: Highlights Q4 2009

    Highlights Q4 2009 RESULT  Group profit of NOK 596 mill in Q4 and NOK 1.276 mill in 2009  Good development in results of Life and Asset Management  Weak net interest income in Bank OPERATIONS  Good sales development in Life&Pensions in Norway and Sweden  Realisation of synergies ahead of plan 

  3. Slide 3: Storebrand Group

    Storebrand Group Q4 Full year NOK mill. 2009 2008 2009 2008 Life and Pension Norway 193 406 759 348 Life and Pension Sweden (SPP) 307 1.419 478 831 Storebrand Investments 138 96 240 218 Storebrand Bank 24 -54 63 68 P&C (incl Health) -1 -9 -18 0 Storebrand ASA / other -64 -71 -255 -155 Group Profit 5

  4. Slide 4: Life and Pensions Norway

    Life and Pensions Norway - buffer capital strengthened  Strong sales and positive Q4 Full year transfer balance NOK mill. 2009 2008 2009 2008 Administration result -19 -56 -169 -177  Efficiency improvement and Risk result cost reducing measures 61 12 229 475 Finance result* 16 356 201 -316 Profit

  5. Slide 5: Life and Pensions Norway - strong sales and positive transfer balance

    Life and Pensions Norway - strong sales and positive transfer balance Transfer balance1  Storebrand has positive transfer 2,8 9,9 balance 5th year running 0,1 Bn NOK 1,1 5,3  Transfers of NOK 2.4 bn notified 0,6  Several large pension schemes 2005 2006 2007 2008 2009 2005- 2009 have chosen Storeb

  6. Slide 6: Life and Pensions Norway - transfer balance and reported sales

    Life and Pensions Norway - strong sales and positive transfer balance Transfer balance and reported sales1  Storebrand has positive transfer balance 5th year running Bn NOK 9.9 2.4  Transfers of NOK 2.4 bn notified Transfer balance Reported sales 2005-2009 2009  Several large pension schemes have

  7. Slide 7: Life and Pensions Norway - improvement in cost efficiency continues

    Life and Pensions Norway - improvement in cost efficiency continues Costs / Customer funds  Headcount reduced 1,20 %  Efficiency improvements 1.01% 1.06% continue 1,00 % 0.88% ― LEAN across departments 0,80 % 0.86% ― Tasks moved to Storebrand Baltic 0,60 % ― Reduced headcount in central functions

  8. Slide 8: Life and Pensions Sweden (SPP)

    Life and Pensions Sweden (SPP) - strengthened market position  Increased market share new Q4 Full year sales NOK mill. 2009 2008 2009 2008  Cost synergies realised Administration result -37 -104 -101 -103 ahead of plan Risk result  Improvement in underlying 82 95 253 287 operations: Finance resul

  9. Slide 9: Sweden (SPP) - strengthened market position

    Life and Pensions Sweden (SPP) - strengthened market position “Top of mind” survey1  New sales APE: AMF 25 - SPP: +6% in 2009 - Market share increased to Alecta 8.7 9.5%* SPP 6.2 Folksam 5.8  Unit Link represents 55% of Skandia 4.2 new sales Up from 9th KPA 3.6 place in 2008 LF  Top score on all

  10. Slide 10: Sweden (SPP) - cost synergies realised ahead of plan

    Life and Pensions Sweden (SPP) - cost synergies realised ahead of plan Annual cost synergies by Mill NOK function 200 150 12 22 Target as100 at Q4 72 2009 153 50 47 0 10

  11. Slide 11: Storebrand Investments

    Storebrand Investments - strong improvement in results  Good returns and high value Q4 Full year creation NOK mill. 2009 2008 2009 2008 Total income* 203 139 496 403  Market development and new sales increases basis for Total costs -90 -68 -339 -264 volume based income Net financial/other 25 25 83

  12. Slide 12: Investments - good returns

    Storebrand Investments - good returns Return on active mandates for Storebrand Life 69,7%  Active management provided Norwegian equities 63,7% return to Storebrand Life of NOK Global equities 10,1 % 7,2 % 977 mill above benchmark indices i 2009 L/S Europe 4,8 % 0,8 % L/S Energy 4,8 % 0,3 %  90% of

  13. Slide 13: Investments - strong sales in funds

    Storebrand Investments - strong sales in funds Accumulated net new subscriptions to Storebrand funds  Positive net new 31,1 2,0 3,4 3,8 5,3 subscriptions to funds in 2009 Bn NOK 39,8 Value increase New subscriptions - SPP fonder: NOK 3.4 bn2 SPP Fonder - STB funds: NOK 2 bn1 21,9 03.03.09 27,7 SFO3

  14. Slide 14: Storebrand Bank

    Storebrand Bank - weak net interest margin Q4 Full year  Cost reducing measures NOK mill. 2009 2008 2009 2008 Net interest income 104 110 423 512  Measures to improve net Net fee and 20 12 76 62 interest income commission income Other income 57 42 148 89 Total income 181 164 647 663  Solid balanc

  15. Slide 15: Bank - cost reducing measures proceeding as planned

    Storebrand Bank - cost reducing measures proceeding as planned  Cost reducing measures being implemented 550 500 - Reduction in headcount 450 50 - Tasks moved to service 400 center Storebrand Baltic 350 504 454 - Consolidate Ring offices 300 - Streamline and simplify IT 250 structure 200 Total cost

  16. Slide 16: Life and Pensions Norway - priority given to building customer buffers

    Life and Pensions Norway - priority given to building customer buffers Defined Individual Group contribution and paid- defined and Risk up Company NOK mill. benefit * unit linked* products policies** portfolio Total Q4 2009 Administration result -10 -6 -8 5 -19 -169 Risk result 6 54 1 61 229 Finance

  17. Slide 17: Paid-up policies portfolio split in risk customised sub-portfolios

    Life and Pensions Norway - the paid-up policies portfolio is split in risk customised sub-portfolios Paid-up policies 9% 10 % 5% 6% 20 % 6% 6% 16 % 6% 16 % 16 % 16 % 38 % 37 % 40 % 34 % 31 % 31 % 33 % 24 % Total Portfolio 1 Portfolio 2 Portfolio 3 12 % 12 % 6% 6% Individual 16 % 16 % Equities 19 % 1

  18. Slide 18: Life and Pensions Sweden (SPP)

    Life and Pensions Sweden (SPP) - good return and changes in reserves give strong financial result  Total financial result of NOK 245 mill in Q4 and NOK 260 mill in 2009  Good return in the quarter: - Profit sharing NOK 75 mill - Recovery of DCC* NOK 231 mill - Hedge result/other minus NOK 61 mill

  19. Slide 19: Sweden (SPP) - expected DCC recovery

    Life and Pensions Sweden (SPP) - expected DCC* recovery Expected DCC recovery** 150 5,9 % 1.548 4,8 % 100 4,0 % 3,9% 3,2 % 3,1 % 50 611 67 0 2010 2011 2012 P250 P300 P520 **  Expected DCC recovery provided expected Discount rate return is achieved and no changes in the Expected rate of return disco

  20. Slide 20: Life and Pensions Sweden - improved business model DB

    Life and Pensions Sweden - improved business model DB* DB portfolio SPP 6%  New business model for DB portfolio introduced from 1 January 27 %  Most important changes: 67 % - Market interest rates used to calculate result to owner - Indexation fee (40+40 bp), replaces profit sharing Equity Interes

  21. Slide 21: Life and Pensions - good solidity and strengthened customer buffers

    Life and Pensions - good solidity and strengthened customer buffers Storebrand Life Group*  Group contribution from 4,00 % 200 % Storebrand Life Group to ASA of 170 % 3,50 % 160 % 154 % 161 % 180 % NOK 610 mill 148 % 160 % 3,00 % 140 % 2,50 %  Group contribution from SPP to Storebrand Holding AB o

  22. Slide 22: Bank - strengthened capital ratio

    Storebrand Bank - strengthened capital ratio 5% Residential  Reduced net lending by NOK mortages 1 bn in the quarter Other 26 % retail Real  Core capital strengthened to 67 % estate 10.4% Other corporate 2%  New liquidity requirements 14 % 13,5 % will have little effect on the 12 % 11,7 % 11,8 %

  23. Slide 23: ASA - reduced net debt

    Storebrand ASA - reduced net debt  Receive NOK 823 mill in Development net debt group contributions  NOK 2.1 bn in liquid assets 2,2 1,4 1,7 NOK bn 4,4  Target net debt ratio of 0 2,2 1,1  Next maturity December -0,2 2010 2006 2007 2008 2009* * Calculated after receipt of group contributions 23

  24. Slide 24: Pension reform - increased requirement for flexibility

    Pension reform – increased requirement for flexibility • Possibility for flexible withdrawals, also from occupational pensions • New savings rates for defined contribution Framework • Minor initial adaptations for defined benefit • Other products not much affected Product • Possible new products dev

  25. Slide 25: Solvency II - Storebrand well prepared

    Solvency II – Storebrand well prepared  New regulatory requirements apply to all European insurance companies from 2013 - Assets and insurance liabilities to be valued at market value - Capital requirement to reflect actual economic risk  Main adaptation themes: - Macro model for discounting pensi

  26. Slide 26: Summary

    Summary  Positive development in results and strengthened market position  Reduced costs and increased efficiency  Strengthened solidity and increased customer buffers  Active adjustments to new regulatory frameworks 26

  27. Slide 27: Storebrand vision statement

    Storebrand shall be the leading and most respected institution in the Nordic market for long-term savings and insurance.

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