Pareto Bank Asa · OSL:PARB
Pareto Bank Asa — Sparebank1 Markets CMD Nordic Challenger Banks (September 2016)
18 slides from Pareto Bank Asa's conference presentation, Sep 5, 2016
Slide 1: Pareto Bank – Sparebank1 Markets CMD Nordic Challenger Banks
PARETO BANK Sparebank1 Markets CMD Nordic Challenger Banks Second Quarter 2016
Slide 2: Norway's Leading Project Bank
NORWAY’S LEADING PROJECT BANK BUSINESS AREAS PROJECTS / CREDITS AREA EXPOSURE AVG. PRINCIPAL 1. Construction financing Real NOKm estate 2. Project financing 57 % 25-50 3. Commercial property financing 1. Securities financing Securities & NOKm Corporates 2. Bridge financing 27 % 5-30 3. M&A financing
Slide 3: A Different Bank
A DIFFERENT BANK • Compact organization with 33 employees • Short decision lines, no bureaucracy and an efficient I FAST MOVER credit decision process • Frequent credit committee meetings facilitate fast time to market • Solution oriented II FLEXIBLE • 80% of the employees work with customers on a d
Slide 4: Portfolio Composition | Overview
PORTFOLIO COMPOSITION | OVERVIEW * Gross credit exposure (NOKm) Σ = NOK 10,714m Gross total lending (NOKm) Σ = NOK 8,373m MAIN BUSINESS AREAS Real Estate 6,086 57% Real Estate 5,118 61% Corporates 942 9% Corporates 799 10% Real estate financing Real focused on residential Securities 1,905 18% Securi
Slide 5: Real Estate (I) | Strong Market Position
REAL ESTATE (I) | STRONG MARKET POSITION * 57% 57% Real Estate credit exposure (NOKm) Σ = NOK 6,086m Geographical residential property exposure (NOKm) ** 1% Residential property 2,925 48% Oslo West 17% Oslo North Lots 1,273 21% 23% Oslo East 1% Oslo Nordstrand Offices 555 9% Akershus South 9% Asker
Slide 6: Real Estate (II) | Policy & Strategy
REAL ESTATE (II) | POLICY & STRATEGY 57% 57% Real Estate portfolio policy Real Estate portfolio strategy • Primarily financing of projects in • Expertise and experience within all the Oslo region and other well areas of significance to a developer functioning and liquid markets • In-house legal and
Slide 7: Securities Financing
SECURITIES FINANCING * 18% 18% Total securities exposure (NOKm) Σ = NOK 1,905m Securities financing Overview Primarily listed 1,464 77% stocks** • Total exposure of NOK 1,905m • 367 customers of which only 47 have a credit facility of above NOK 10m Bonds 423 22% • Real time follow-up and any breach
Slide 8: Corporate Financing
9% CORPORATE FINANCING * 9% Total corporate finance exposure by industry (NOKm) Σ = NOK 942m Corporate financing Overview • Total exposure of NOK 942m • 30 customers with credit facilities/guarantees in the range of 10% NOK 1m to NOK 200m 2% • Exposure to a variety of industries Real estate 7% Techn
Slide 9: Shipping & Offshore (I) | Diversified Loans
13% 13% SHIPPING & OFFSHORE (I) | DIVERSIFIED LOANS * Key comments Total S&O credit exposure (NOKm) Σ = NOK 1,422m • 24 loans financing a total of 35 vessels Product 291 20% • Largest exposure is USD 13.3m; average size USD 6.7m Bulk 207 15% • Weighted average loan to value (LTV) is 62% Chemical 190
Slide 10: Shipping & Offshore (II) | Policy & Strategy
13% 13% SHIPPING & OFFSHORE (II) | POLICY & STRATEGY S&O portfolio policy S&O portfolio strategy • Minimum equity of 30%, • Thorough decision making process: but normally in the range all loans approved by the BoD of 40% to 50% • External specialists used as • Clients should be based in consultants
Slide 11: Financial Targets and Dividend Policy
FINANCIAL TARGETS AND DIVIDEND POLICY 30.06.2016 STATUS 31.12.2016 TARGET Cost effective 16.3% > 15.0% ROE and commercially oriented bank ADEQUACY CET1 capital in CAPITAL 15.1% 15.0% * line with NFSA requirements The actual payout ratio DIVIDEND POLICY 30-50% ** 30-50% ** will depend on the growth p
Slide 12: Solid Foundation and Strong Performance
SOLID FOUNDATION AND STRONG PERFORMANCE Result after tax (NOKm) Return on Equity (after tax) CET1 ratio * 16.5% 15.6% 16.3% 15.1 % 174.6 165.8 13.2 % 13.3% 12.1 % 11.1 % 11.5 % 122.4 111.8 8.9% 79.7 2012 2013 2014 2015 YTD-16 2012 2013 2014 2015 YTD-16 2012 2013 2014 2015 YTD-16 Net interest income
Slide 13: Loan Portfolio Quality
LOAN PORTFOLIO QUALITY Net non-performing and impaired loans * Cumulative group provisions % of gross lending Nominal (NOKm) and % of gross lending 0.52% 0.51% 0.48% 43.7 0.44% 40.7 40.7 0.40% 0.41% 0.42% 0.37% 0.34% 30.7 30.7 0.31% 28.7 0.30% 26.7 0.94% 0.26% 24.7 0.47% 1.14% 0.96% 22.7 0.37% 20.7
Slide 14: Funding (I) | Overview
FUNDING (I) | OVERVIEW * Sources (NOKm) Σ = NOK 12,873m Historical development in deposits vs. lending (NOKm) Deposits 7,429 58% 102% 98% 95% 96% Senior debt 3,529 27% 91% 90% 88% 89% 86% 85% 86% 84% 83% T1 & T2 debt 310 2% 81% 8,368 8,326 7,931 Other debt 108 1% 7,596 7,347 7,487 7,171 7,162 7,246
Slide 15: Successful Equity Issues and Listing
SUCCESSFUL EQUITY ISSUES AND LISTING 1 2 • The bank successfully raised in total NOK 203m in equity capital through four PRIVATE REPAIR issues in Q1-2016. PLACEMENT OFFERING • The objective of the capital increase was to strengthen the bank’s CET1 capital in NOK 150m NOK 47m line with the Norwegian
Slide 16: Largest Shareholders as of 31.08.2016
LARGEST SHAREHOLDERS AS OF 31.08.2016 # Investor Country Type 31.08.2016 # of shares % total • The Company has 51,953,022 shares 1 Pareto AS NOR Corporate 7,886,940 15.18% outstanding 2 Pecunia Forvaltning AS NOR Corporate 5,195,302 10.00% 3 Arne Helge Fredly LUX Private 4,000,000 7.70% • One class
Slide 17: Financial Strength and Capital Targets
FINANCIAL STRENGTH AND CAPITAL TARGETS Pareto Bank capital ratios, requirements and targets * Key comments LEVERAGE RATIO REQUIREMENTS ACTUAL TARGET • The bank’s capital target for CET1 is 15 % by end-of-year 2016 18.4 % 18.5 % • The bank assessment of its ICAAP 1.6 % 2.0 % requirement including Pil
Slide 18: PAGE 18
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