Slide 1: Results 3rd Quarter 2006 Analyst Presentation
Storebrand Results 3rd Quarter 2006 1 November 2006 Analyst Presentation Analyst Presentation 3rd quarter 2006 Page # Slide # • Storebrand Group Group CEO Idar Kreutzer 2-9 3-18 Back-up: • Storebrand Group 10-15 19-30 • Storebrand ASA 16-17 31-34 • Storebrand Life Insurance 18-29 35-58 • Storebrand
Slide 2: Highlights Q3 2006
Storebrand Results 3rd Quarter 2006 1 November 2006 Idar Kreutzer Group CEO Highlights Q3 2006 Solid group result in Q3 and for the year to date Good investment return in the life company gives solid result to customers and owners. Increased risk capital. Improvement continues in asset managem
Slide 3: Storebrand Group - solid result
Storebrand Group - solid result Q3 01.01 - 30.09 01.01-31.12 NOK million 2006 2005 2006 2005 2005 Life activities 244 291 819 853 1 217 Investment activities 38 -2 90 20 24 Storebrand Bank 47 42 154 182 241 Other activities -13 -13 63 -31 -41 Group profit 315 318 1 125 1 024 1 442 Q3 2006 5 Storebra
Slide 4: Increased risk capital
Storebrand Livsforsikring Return on main asset classes as per Q3 2006 Relative Risk Return year to date1) return exposure2) Norwegian 17,8 % +6.3 % 3.9 % Equities International 3) 7,3 % +0.4 % 20.0 % Equities International 1,4 % +0.3 % 10.3 % Bonds Norwegian 1,3 % +0.7 % 9.0 % Bonds Money +0.2 % 7.1
Slide 5: Strong net inflow of group pension scheme customers
Strong net inflow of group pension scheme customers to Storebrand Transfer Balance Defined Benefit NOK mill. Defined benefit: 6 000 - Positive transfer balance of NOK 4.8 bn as per Q3 2006 4 000 (NOK 1.4 bn in Q3) 2 000 Defined contribution: 0 - 26% market share of new - 2 000 sales of defined c
Slide 6: Storebrand Bank and Storebrand Investments - Improvement continues
Storebrand Bank Gross lending – Retail Marketing activities and 20 000 attractive terms ensure solid growth in lending + 2.7 (NOK bn) and strong growth in new 15 000 customers to the bank Gross lending increased to 10 000 NOK mill. 2005 9M 2006 NOK 28.5 bn as per Q3 No. of new accounts opened 20
Slide 7: Successful launch of new products
Successful launch of new products Q3 2006 13 Great response to re-establishment of P&C Storebrand Skadeforsikring fully operational after internal launch on 12 October Customer response much greater than expected, with 100 – 150 customer calls every day and 300 customers already signed Web-sol
Slide 8: Highlights from Storebrand's Capital Markets Day
Highlights from Storebrand's Capital Markets Day Cross sales and sales efficiency: Storebrand will return in 312,000 retail 2007 with: customers 325,000 205,000 9 Cross sales targets paid-up work site policies customers 9 Sales efficiency targets 9 Baseline for targets Increased productivity in core
Slide 9: Storebrand's objective is to be the leading institution
Storebrand's objective is to be the leading and most respected institution in the Norwegian market for long-term savings and insurance Q3 2006 17 (Page intentionally left blank) Q3 2006 18 9
Slide 10: Group IFRS accounting
Storebrand Group IFRS accounting Storebrand ASA’s group accounts are presented in accordance with the International Financial Reporting Standards (IFRS) approved by the European Union. Q3 2006 20 10
Slide 11: Group profit by sub-group
Storebrand Group Group profit by sub-group Q3 01.01 - 30.09 01.01-31.12 NOK million 2006 2005 2006 2005 2005 Life activities 244 291 819 853 1 217 Investment activities 38 -2 90 20 24 Storebrand Bank 47 42 154 182 241 Other activities -13 -13 63 -31 -41 Group profit 315 318 1 125 1 024 1 442 Q3 2006
Slide 12: Group earnings per share and balance sheet
Storebrand Group Earnings per share Q3 01.01 - 30.09 01.01-31.12 NOK million 2006 2005 2006 2005 2005 Group profit 315 318 1 125 1 024 1 442 Changes in security reserve etc. - non life -1 0 -2 -2 3 Profit before tax 313 318 1 123 1 022 1 445 Tax - 22 - 12 - 75 - 52 - 41 Minority interests -1 -1 -7 -
Slide 13: Group profit by quarter and capital adequacy
Storebrand Group Group profit by quarter 2006 2005 2006 NOK million Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Life activities 244 277 299 364 291 307 255 311 Investment activities 38 32 20 4 -2 14 8 8 Storebrand Bank 47 59 48 59 42 69 72 55 Other activities -13 -18 94 -9 -13 1 -20 -3 Group profit 315 350 460 418 318
Slide 14: Other activities and shareholder structure
Storebrand Group Other activities Q3 01.01 - 30.09 01.01-31.12 NOK million 2006 2005 2006 2005 2005 Storebrand ASA *) -8 -31 1.017 553 599 Fair Forsikring 0 18 -1 26 22 Storebrand Skadeforsikring -5 0 39 0 19 Other companies/elimintations **) 0 1 -991 -611 -681 Total profit other activities -13 -13
Slide 15: Rating and key figures
Rating for Storebrand as at 1 November 2006 Storebrand ASA Moody’s: Baa2 (S) S&P: BBB+ (S) Storebrand Storebrand Livsforsikring AS Bank ASA Moody’s: A2 (S) Moody’s: Baa2 (S) S&P: A (S) S&P: BBB+ (S) P=positive outlook, S=stable outlook, N=negative outlook Q3 2006 29 Storebrand Group Key figures Q3 0
Slide 16: Storebrand ASA Profit and loss
Storebrand ASA Storebrand ASA Profit and loss*) Q3 01.01 - 30.09 01.01-31.12 NOK million 2006 2005 2006 2005 2005 Group contributions and transfers 0 0 1 028 611 611 Interest income 18 12 55 41 58 Interest expense - 20 - 10 - 55 - 36 - 53 Realised/unrealised gains/losses on securities 13 11 49 136 2
Slide 17: Storebrand ASA profit and loss by quarter and balance sheet
Storebrand ASA Profit and loss 2006 2005 2004 NOK million Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Group contributions and transfers 0 0 1 028 0 0 0 611 0 Interest income 18 21 16 17 12 11 18 19 Interest expense - 20 - 18 - 17 - 17 - 10 -4 - 22 - 14 Realised/unrealised gains/losses on securities 13 -2 39 76 11 116 9
Slide 18: Storebrand Life Group Highlights as at 30.09.2006
Storebrand Life Insurance Storebrand Life Group Highlights as at 30.09.2006 Operating profit in Q3 was NOK 639 million, compared to NOK 1,106 million in Q3 2005. Operating profit as at 30.09.2006 was NOK 3,212 million compared to NOK 2,946 million as at 30.09.2005 (before effects from IFRS). Effec
Slide 19: Life Insurance Highlights and Results
Storebrand Life Insurance Highlights as at 30.09.2006 Merger between Storebrand Livsforsikring AS and Storebrand Fondsforsikring AS completed in Q3. Total premium income (excluding net transfers) increased by 29% compared to Q3 2005. Excl. individual savings contracts without fixed contract peri
Slide 20: Life Group Profit and loss; Satisfactory solidity
Storebrand Life Group Profit and loss Q3 01.01.-30.09 Full year NOK Million 2006 2005 2006 2005 2005 Premiums written 2,965 2,681 9,953 14,061 16,805 Net transfers of premium reserve 1,368 114 4,843 712 564 Net income of financial investments 3,476 3,534 7,216 8,120 10,445 Net incom Unit Linked asse
Slide 21: Storebrand Livsforsikring AS Asset allocation
Storebrand Livsforsikring AS Asset allocation Allocation and policyholders' fund Q3-06 Q2-06 Q1-06 Q4-05 Q3-05 Q2-05 Q1-05 Q4-04 Equity Norwegian *) 5% 6% 7% 9% 6% 6% 6% 9% Equity Foreign*) 22 % 19 % 20 % 18 % 17 % 16 % 16 % 13 % Real Estate 11 % 11 % 10 % 9% 9% 9% 9% 10 % Money market 3% 5% 5% 6% 8
Slide 22: Development in return; Unrealised gains
Storebrand Livsforsikring AS Development in return 12 % 11,2 % 10 % 8,8 % 7,5 % 8% 7,6 % Booked 7,2 % 6,9 % 7,2 % 6,5 % 6,9 % Value adjusted excl. Bonds 6% 6,4 % 6,4 % held to maturity 5,1 % Value adjusted incl. Bonds 4% held to maturity 2,7 % 2,6 % 2% 1,9 % 0% 2002 2003 2004 2005 9M06 annualised Q3
Slide 23: Premiums excl. reserves transferred to the company
Storebrand Life Group Premiums excl. reserves transferred to the company as at 30.09.2006 Total premiums written NOK 9,953 million 6% 1% Group pension 5% Group pension defined contribution Group Life 21 % Individual endowment 57 % Individual endowment Unit Linked 5% Individual pension 5% Non-life in
Slide 24: Premiums written, products without profit sharing
Storebrand Livsforsikring AS -premiums written, products without profit sharing as at 30.09 NOK million 2000 Non-life insurance 1800 Individual endowment Unit 1600 Linked Individual endowment 1400 Group life 1200 Group pension defined 1000 contribution Group pension* 800 600 *) Group pension applies
Slide 25: New business – premiums
New business – premiums* NOK million 2004 2005 9M 2005 9M 2006 Storebrand Livsforsikring AS Regular premiums 606 647 363 565 - individual business 121 160 138 82 - group pension and group life 485 488 225 483 Single premiums and transferred reserves 9 515 10 128 8 963 8 009 - individual business 6 9
Slide 26: Profit analysis
Storebrand Livsforsikring AS Profit analysis Q3 01.01.-30.09 Full year NOK Million 2006 2005 2006 2005 2005 Interest result 589 977 3,203 2,854 4,359 Risk result 92 99 282 198 363 Administration result -19 31 -201 -100 -330 Change in security and premium reserve -6 -2 -18 -6 -11 Profit Unit Linked -
Slide 27: Life Group Balance sheet IFRS
Storebrand Life Group Balance sheet IFRS Share of Share of total assets total assets NOK Million 30.09.06 30.09.06 31.12.2005 31.12.2005 Immaterial assets 12 0% 25 0% Real estate 16,122 9% 13,503 8% Long term shares and interests from group companies 99 0% 100 0% Bonds held to maturity 44,640 25 % 4
Slide 28: Profit to owner; Key figures
Storebrand Livsforsikring AS Profit to owner NOK Million Q3 01.01.-30.09 Q3 01.01.-30.09 PROFIT SHARING MODEL 2006 REGULATORY MAXIMUM 2006 Net return on company capital 91 378 Management fee charged from policyholders` fund 139 419 35% of profit from products Risk margin 12 35 with profit sharing ad
Slide 29: Real estate fund
Storebrand Livsforsikring AS Real estate fund 01.01.-30.09. 01.01.-31.12. Key figures 2006 2005 2005 Portfolio allocation The real estate fund: (Market value) Growth in value 6.6% 5.5% 7.8% Booked yield *) 6.3% 5.3% 7.5% Shopping Direct yield 5.3% 5.3% 7.3% centres Revaluations 1.0% 0.0% 0.2% 33 % O
Slide 30: Storebrand Investments Highlights Q3
Storebrand Investments Storebrand Investments Highlights Q3 Q3 profit before tax NOK 38 million compared to a loss of NOK 2 million in 2005. Significant value added through strong performance in the discretionary portfolio provides an increase in performance fees for 3rd quarter. Storebrand’s
Slide 31: Profit before tax 3Q 2006; Profit development
Profit before tax 3Q 2006 3rd quarter Year to date Year NOK million 2006 2005 2006 2005 2005 Total income 98 42 246 177 242 Total costs -67 -49 -185 -169 -232 Net financial income/ other 7 5 29 12 15 Profit before tax 38 -2 90 20 24 Increased income due to higher performance related fees. The in
Slide 32: Contribution to Storebrand Life portfolio; Mutual funds performance
Contribution to Storebrand Life portfolio year to date Relative performance Norwegian Equities 14,1 % 11,5 % 2,6% European Equities 4,0 % -0,3% 4,3 % 3,0 % North American Equities -0,7% 3,7 % 1,3 % Norwegian Bonds 0,6% 0,6 % 2,8 % International Bonds 0,1% 2,7 % 2,1 % Norwegian Money Market 1,9 % 0,3
Slide 33: Market share Norwegian registered mutual funds
Market share Norwegian registered mutual funds Mutual funds market in All mutual funds (market share in %) Norway 7,9 8,4 7,9 Nordea 8,3 8,4 Norwegian mutual funds 12,4 11,2 12,5 Odin 12,0 11,6 exceed NOK 180 billion in 13,9 14,4 16,7 15,8 16,7 Skagen assets under management. 11,8 10,8 10,8 10,3 1
Slide 34: Assets under management; Profit development
Storebrand Investments Assets under management Total assets under management Allocation assets under management Real est ate Hold to 9% Other 215,0 mat urity 3% 204,9 26 % Equity Norway 22,4 NOK billion 20,3 5% 158,8 165,0 33,5 29,4 15,8 139,7 13,2 14,6 18,4 9,7 10,6 25,3 12,9 21,6 10,1 M oney marke
Slide 35: Storebrand Bank Group Highlights Q3 2006
Storebrand Bank Storebrand Bank Group Highlights Q3 2006 Storebrand Bank Group reports a profit of NOK 47 million in Q3 (NOK 42 million in Q3 2005). Growth in gross lending of NOK 624 million. Net income from loan loss provisions of NOK 11 million in Q3. Good increase in customers, and more
Slide 36: Profit and loss; Development in net interest income
Profit and loss Q3 01.01-30.09 Full year NOK million 2006 2005 2006 2005 2005 Net interest income 109 106 318 338 451 Other income 37 19 97 75 102 Total income 146 124 415 413 553 Operating expenses -110 -80 -302 -250 -346 Operating profit befor 36 45 113 163 207 Loan loss provisions 11 -3 41 19 34
Slide 37: Balance sheet; Development in loan portfolio
Balance sheet 30/09/2006 Share 31/12/2005 Share NOK million Loans to central banks / credit institutions 764 2% 466 2% Net lending to customers 28,118 86% 26,279 89% Securities and bonds 2,013 6% 1,712 6% Shareholdings in associated / group companies 246 1% 286 1% Fixed / intangible assets 1,367 4%
Slide 38: Defaulted loans and loss provisions; customer deposits
Development in defaulted loans and loss provisions Further reduction in defaulted NOK million loans with identified loss of 900 90% value in Q3 of NOK 54 million to 800 80% NOK 448 million 700 360 70% 600 340 294 500 252 60% 210 Individual impairment loss 400 142 90 50% provisions of NOK 358 mil
Slide 39: Capital adequacy; New accounts
Capital adequacy NOK million and % 30.09.2006 31.12.2005 Core capital 1 539 1 528 Subordinated loan capital 429 430 Total capital 1 968 1 958 Risk-weighted basis for calculation 20 379 18 742 Capital ratio(*) 9,7 % 10,4 % Surplus capital (**) 338 459 Core capital ratio 7,6 % 8,2 % Note: Storebrand B
Slide 40: Quarterly development in profit and loss
Quarterly development in profit and loss 2006 2005 NOK million Q3 Q2 Q1 Q4 Q3 Q2 Q1 Net interest income 109 102 106 113 106 112 120 Other income 37 36 24 27 19 16 41 Total income 146 138 131 140 124 128 161 Operating expenses -110 -94 -97 -97 -80 -82 -88 Operating profit befor 36 44 34 43 45 46 73 L
Slide 41: Storebrand Non-Life Highlights Q3 2006
Storebrand Non-life Non-Life Highlights Q3 2006 Operating loss in Q3 was NOK 5 million (profit of NOK 18 million) and YTD profit of NOK 38 million (NOK 26 million). Operating loss adjusted for statutory insurance reserves in Q3 amounts to NOK 5 million (profit of NOK 19 million) and YTD profit of
Slide 42: Non-Life Group Profit and loss and balance sheet
Non-Life Group Profit and loss Q3 01.01. - 30.09 Full year NOK million 2006 2005 2006 2005 2005 50% share of result from Fair 0 18 -1 26 22 Storebrand Skadeforsikring AS -7 0 39 -1 52 Oslo Reinsurance Company ASA (run-off) 2 0 0 1 12 Eliminations 0 0 0 0 -46 Operating result non life insurance -5 18
Slide 43: Oslo Reinsurance Company Profit and loss
Oslo Reinsurance Company Profit and loss Q3 01.01. - 30.09 Full year NOK million 2006 2005 2006 2005 2005 Premiums for own account 1 1 2 4 5 Claims for own account -1 -6 -5 -6 0 Insurance related operating costs -6 -3 -20 -20 -22 Financial income 6 2 12 14 14 Other income/costs 2 6 9 9 15 Operating