Nordea Bank Abp · OMXHEX:NDA_FI
Nordea Bank Abp — Nordea — Q2 2002 Earnings Presentation
16 slides from Nordea Bank Abp's earnings presentation, Aug 22, 2002
Slide 1: Results second quarter 2002
Results second quarter 2002 22 August 2002
Slide 2: Stable profit excluding investment earnings
Stable profit excluding investment earnings l Operating profit before investment earnings EUR 409m, unchanged compared to first quarter l Total income EUR 1,513, up 1% on first quarter supported by strong commission income and growth in loans and deposits l Net interest income up 2% l Commission inc
Slide 3: Income statement summary
Income statement summary EURm Q2/02 Q1/02 Change, % Income 1,513 1,494 1 Expenses -1,065 -1,037 3 Loan losses -56 -63 -11 Equity method 17 15 13 Profit excl. investment earnings 409 409 0 Investment earnings -50 4 Goodwill -44 -42 5 Operating profit 315 371 -15 3
Slide 4: Net interest income
Net interest income EURm l Net interest income up 2% 1000 l Higher lending and deposit 885 800 856 852 837 855 volumes l Largely unchanged margins 600 400 200 0 Q2/01 Q3/01 Q4/01 Q1/02 Q2/02 4
Slide 5: Commission income
Commission income EURm 382 397 500 365 369 319 34 45 l Payment commissions up 44 34 400 22 84 87 91 17% 91 84 46 - Acquisition of Postgirot 300 55 76 Growth in electronic 60 56 183 - 157 139 payment services 200 127 130 l Weak equity markets 100 - Negative impact on asset 116 115 126 115 104 managem
Slide 6: Income from insurance
Income from insurance EURm 200 180 l High claims in General 185 160 Insurance 140 142 l Weak equity markets 120 100 116 affected income from Life 80 93 60 72 40 20 0 Q2/01 Q3/01 Q4/01 Q1/02 Q2/02 6
Slide 7: Expenses
Expenses EURm 1200 l Development according to plan 1000 476 451 467 410 410 l Higher level of activity in Q2 800 l Investments relating to the second wave EUR 25m 600 586 598 556 529 562 400 200 0 Q2/01 Q3/01 Q4/01 Q1/02 Q2/02 7 Personnel Other
Slide 8: Loan losses
Loan losses EURm l Loan losses down to 225 EUR 56m (EUR 63m) 200 100 175 l Loan losses, 0.16% of total 150 loans in Q2, annualised 125 l Commitments to the telecom 100 113 sector EUR 6.2bn 75 (EUR 6.9bn) 50 63 59 56 56 25 0 Q2/01 Q4/01 Q2/02 General provision 8
Slide 9: Weak equity markets
Weak equity markets l Investment earnings EUR –50m l Financial buffers in Life operations satisfactory l Pension fund allocation of EUR 152m, reduced pre-tax profit 9
Slide 10: Retail Banking
Retail Banking l Operating profit increased l Return on equity of 25% l Growth in both lending and deposits l 3.1 million e-banking customers and 274,000 online equity trading customers by the end of June l Firm development in sales of products and services 10
Slide 11: Corporate and Institutional Banking
Corporate and Institutional Banking l Operating profit stable l Income down by 5% l A number of prominent mandates were achieved l Significant growth in customer demand for derivatives l Position as leading arranger of syndicated loans for Nordic corporates consolidated l Business flow in Investment
Slide 12: Asset Management & Life
Asset Management & Life l AuM down 7% to EUR 100bn in difficult markets l Life buffers reduced, but solvency still adequate l Total annualised inflow of 9% during first half of 2002 l Nordea funds “Best Equity Group of the Year” in Germany 12
Slide 13: Integration and focus on core areas
Integration and focus on core areas l General Insurance business sold with effect from 1 July l LG Petro Bank bid: all approvals in place, tender offer to be launched l Second wave programme consolidated into 15 main projects 13
Slide 14: Second wave of integration
Second wave of integration l Consolidated into 15 main projects of which 7 are under execution l Creating additional synergies in line with merger synergies within 3 years l Total investments for the programme EUR 350m-400m, 25% in 2002, 50% in 2003 and 25% in 2004 l Approximately half will be on to
Slide 15: Outlook 2002
Outlook 2002 l Moderate growth in the business volume and thereby revenues in the second half of 2002 (adjusted for the sale of General Insurance) l Sharp focus on cost control – zero cost growth in 2002 on a comparable basis excluding second wave investments l Loan losses in the second half of 2002
Slide 16: In summary
In summary l Stable development in core earnings l Satisfactory credit quality l The disposal of the General Insurance business will lead to increased earnings stability l Sharp focus on cost control l Investments in future growth and increased efficiency 16