Nordea Bank Abp · OMXHEX:NDA_FI
Nordea Bank Abp — Q1 2021 Earnings Presentation
21 slides from Nordea Bank Abp's earnings presentation, Jun 3, 2021
Slide 1: First-quarter results 2021
First-quarter results 2021
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements that reflect management’s current views with respect to certain future events and potential financial performance. Although Nordea believes that the expectations reflected in such forward-looking statements are reasonable, no assurance
Slide 3: Executive summary
Executive summary • Continued growth in business volumes and customer satisfaction across Nordics ➢ Mortgage lending volumes up 6% y/y and SME lending volumes up 7% y/y ➢ Assets under management up 33% to record high of EUR 372bn; particularly strong net inflow into retail funds • Operating profit u
Slide 4: Group quarterly results Q1 2021
Group quarterly results Q1 2021 Income statement and key ratios Q121 Q120 Q1/Q1 Q420 Q1/Q4 EURm Net interest income 1,212 1,109 9% 1,169 4% Net fee and commission income 827 765 8% 792 4% Net fair value result 370 110 236 % 217 71 % Other income 11 18 41 Total operating income 2,420 2,002 21 % 2,219
Slide 5: Net interest income – continued growth in business volumes
Net interest income – continued growth in business volumes Year-over-year bridge, EURm Comments +9% • Net interest income up 9% (up 7% excl. Nordea 1,212 Finance Equipment) 12 20 31 71 • Mortgage volumes up 6% and lending to SMEs up 7% 1,109 33 • Continued increase in customer satisfaction scores Q1
Slide 6: Net fee and commission income – highest level since 2017
Net fee and commission income – highest level since 2017, driven by savings and advisory Year-over-year bridge, EURm Comments +8% • Net fee and commission income up 8% 827 11 11 17 23 14 • Savings and investment commission income up 12%, 55 driven by AuM growth 765 • Higher levels of customer activi
Slide 7: Net fair value result – exceptionally strong result in all areas
Net fair value result – exceptionally strong result in all areas Net fair value result, EURm Comments • High activity in customer areas +236% • Exceptionally strong quarter in market-making 370 20 operations 316 14 257 134 • Very strong trading result in fixed income, FX and 110 91 equities 47 217 4
Slide 8: Costs – underlying cost decrease in line with plan
Costs – underlying cost decrease in line with plan Year-over-year bridge, EURm Comments +6% • Underlying costs down 3% (EUR 35m) 1,319 20 • Full-year resolution fee of EUR 224m booked in Q1 1,248 71 35 2021 15 • Exchange rate effects and inclusion of Nordea Finance Equipment (NFE) Q120 Underlying co
Slide 9: Net loan losses and similar net result – credit quality remains strong
Net loan losses and similar net result – credit quality remains strong Net loan losses and similar net result Q121, EURm Comments • Net loan losses and similar net result EUR 52m -20 63 -11 0 52 • Credit quality strong and realised net loan losses low 83 • Stage 3 loans 1.53%, slight increase q/q, m
Slide 10: Capital – very strong capital position to support customers and pay dividends
Capital – very strong capital position to support customers and pay dividends CET1 capital ratio development, % Comments 1.9 0.1 0.0 0.3 -0.1 0.2 0.0 • CET1 capital ratio 17.5%, 7.3 percentage points above regulatory requirement* <2.0 • Risk exposure amount down EUR 1.4bn to EUR 154bn, 17.1 17.5 mai
Slide 11: Personal Banking – continued good growth in business volumes
Personal Banking – continued good growth in business volumes Total income, EURm Comments +6% • Continued good mortgage volume growth across Nordic 847 877 828 818 838 countries: up 6%* • Total income up 6% 515 501 543 535 562 • Nordea winning market shares across the Nordics • Continued recovery in
Slide 12: Business Banking – high levels of business activity
Business Banking – high levels of business activity Total income, EURm Comments +12% • Strong quarter with continued high levels of business activity 617 641 574 543 • Lending volumes up 7%* (3% excluding NFE), with growth in all 542 countries 347 383 395 • Higher capital markets income partially of
Slide 13: Large Corporates & Institutions – strong progress on strategic repositioning plan
Large Corporates & Institutions – strong progress on strategic repositioning plan Total income, EURm Comments • Total income up 53% – improvements across all income lines 622 +53% • Margins higher while total lending down due to repositioning 465 476 445 240 • High activity within Investment Banking
Slide 14: Asset & Wealth Management – record volumes and strong net inflow
Asset & Wealth Management – record volumes and strong net inflow Total income, EURm Comments • Assets under management (AuM) up 33% to all-time high of +13% 292 EUR 372bn 259 263 19 247 18 228 16 16 • Net inflow of EUR 3.3bn, with strong contributions from retail funds, 17 Private Banking and Life &
Slide 15: We are committed to delivering on our financial targets
We are committed to delivering on our financial targets 2022 TARGETS Cost-to-income ratio Capital policy 50% 150-200bp management buffer above regulatory CET1 requirement Return on equity Dividend policy 60-70% payout of distributable >10% profits to shareholders Excess capital intended to be distri
Slide 16: Thank you
Thank you
Slide 17: Appendix
Nordea Appendix
Slide 18: Loan book – well diversified with strong credit quality
Loan book – well diversified with strong credit quality Portfolio well diversified Five segments with 4% of Updated analysis of COVID-19 across countries and total exposures significantly impact by segment segments affected 0.1% Air transportation EUR 13bn, 4% Significantly affected 0.1% Mining & su
Slide 19: Strong and stable credit quality
Strong and stable credit quality Stage 2 and 3 loans at amortised cost, EURm Comments • Stage 2 loans slightly up (4% q/q), related to small number of COVID-19-affected customers 12,512 13,576 13,840 14,383 • Stage 3 loans still at low levels; small increase q/q 8,863 due to exchange rate movements
Slide 20: Coverage ratios – well provisioned for potential losses
Coverage ratios – well provisioned for potential losses Coverage ratios Significantly Partially affected Non-significantly affected segments segments affected segments 73 70 Avg. 48% Avg. 46% Avg. 32% 68 67 63 62 60 58 55 55 52 53 53 50 50 50 51 49 48 49 48 46 43 44 44 44 43 42 42 41 41 38 38 38 10
Slide 21: Nordic economic development – resilient economies rebounding
Nordic economic development – resilient economies rebounding House prices Comments • Danish GDP up 0.7% q/q in Q4. Unemployment up to 4.6% in February and house prices up 12% y/y in March. • Finnish GDP up 0.4% q/q in Q4. Unemployment down to 8.1% in February and house prices up 1% y/y in February.