Gjensidige Pensjonsforsikring AS (GPF) Investor presentation. June 2016

Transcription

1 Gjensidige Pensjonsforsikring AS (GPF) Investor presentation June 2016

2 Disclaimer This presentation and the information contained herein have been prepared by and is the sole responsibility of Gjensidige Pensjonsforsikring AS (the "Company ). Such information is being provided to you solely for your information and may not be reproduced, retransmitted, further distributed to any other person or published, in whole or in part, for any purpose. Failure to comply with this restriction may constitute a violation of applicable securities laws. The information and opinions presented herein are based on general information gathered at the time of writing and are therefore subject to change without notice. The Company assumes no obligations to update or correct any of the information set out herein. These materials may contain statements about future events and expectations that are forward-looking statements. Any statement in these materials that is not a statement of historical fact including, without limitation, those regarding the Company s financial position, business strategy, plans and objectives of management for future operations is a forward-looking statement that involves known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding the Company s present and future business strategies and the environment in which the Company will operate in the future. The Company assumes no obligations to update the forward-looking statements contained herein to reflect actual results, changes in assumptions or changes in factors affecting these statements. This presentation does not constitute or form part of, and is not prepared or made in connection with, an offer or invitation to sell, or any solicitation of any offer to subscribe for or purchase any securities and nothing contained herein shall form the basis of any contract or commitment whatsoever. No reliance may be placed for any purposes whatsoever on the information contained in this presentation or on its completeness, accuracy or fairness. The information in this presentation is subject to verification, completion and change. The contents of this presentation have not been independently verified. While the Company relies on information obtained from sources believed to be reliable, it does not guarantee its accuracy or completeness. Accordingly, no representation or warranty, express or implied, is made or given by or on behalf of the Company or any of its owners, directors, officers or employees or any other person as to the accuracy, completeness or fairness of the information or opinions contained in this presentation. None of the Company, its affiliates or any of their respective advisors or representatives or any other person shall have any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with the presentation. The Company's securities have not been and will not be registered under the US Securities Act of 1933, as amended (the "US Securities Act ), and are offered and sold only outside the United States in accordance with an exemption from registration provided by Regulation S of the US Securities Act. This presentation should not form the basis of any investment decision. Investors and prospective investors in securities of any issuer mentioned herein are required to make their own independent investigation and appraisal of the business and financial condition of such company and the nature of the securities. Any decision to purchase securities in the context of a proposed offering of securities, if any, should be made solely on the basis of information contained in any offering documents published in relation to such an offering. For further information about the Company, reference is made public disclosures made by the Company, such as filings made with the Oslo Stock Exchange, periodic reports and other materials available on the Company's web pages. 2

3 Key messages Leading defined contribution pension specialist - Defined contribution and disability pension only - Limited share of paid-up policies managed for stable returns and limited capital requirement Competitive business model - Cost efficient and scalable Positioned for continued growth and increased profitability Integrated part of Gjensidige s small and medium enterprise (SME) offering Potential subordinated bond issue (Tier 2) to strengthen solvency position and optimise capital structure 3

4 GPF strategically important for the Group - strengthen position in the Norwegian SME market Gjensidige Insurance Group Gjensidige Insurance Group Leading Nordic general insurance company with 200 years history Solvency II margin standard formula Q % S&P A rating with strong enterprise risk management Earned premiums 2015: NOK 21.3bn Pre-tax profit 2015: NOK 5.0bn Norway General insurance Retail Bank Pension and Savings (GPF and GIR) Nordic General insurance Baltics General insurance Gjensidige Pensjonsforsikring AS (GPF) Established in 2005 Owned by Gjensidige Pensjon og Sparing Holding AS, a fully owned subsidiary of Gjensidige Forsikring ASA Assets under management 2015: NOK 20.0bn Strategic importance to the Group Strong value-proposition in the Norwegian SMEmarket 71 per cent shared customers (SME, direct distribution) 4

5 Number four position in the growing Norwegian defined contribution pension market Well positioned for continued profitable organic growth 35.0% 30.0% Market shares total AUM NOK 147bn Storebrand Core focus on SME customers 25.0% DNB Strong profitability Multi-channel distribution 20.0% 15.0% Nordea Gjensidige 10.0% Sparebank 1 5.0% Danica 0.0% Others Market shares based on AUM, defined contribution scheme. Source: Finance Norway 5

6 Number two position in the Norwegian individual disability pension market A strong contender in a growing market 35.0% Market shares - total market premiums NOK 1.4bn Sparebank 1 Increasingly important to Gjensidige s ambitions within life and health 30.0% 25.0% Gjensidige insurance market 20.0% Storebrand DNB 15.0% Nordea 10.0% 5.0% Frende 0.0% IF Market shares based on annual premium. Source: Finance Norway 6

7 Strong volume and profit growth in GPF NOK m 80 Growing pre-tax profit NOK bn 25 AUM growth * Paid up policy Unit linked Other *Negative VAT effect of ~NOK 30m 7

8 Solid revenue growth and profitability development NOK m Q Q Earned premiums Claims incurred etc. (275) (295) (1 276) (1 126) (780) Net insurance revenue Management income etc Total operating Income Operating expenses (46) (47) (191) (192) (155) Net operating income Net financial income Profit/(loss) before tax expense Net Operating margin 25.8% 23.0% 19.1% 2.7% 10.5% Return on equity (annualised) 14.7% 11.0% 9.8% 5.0% 6.2% 8

9 Well positioned for long-term growth in the Norwegian defined contribution pension market Annual contribution (DC) and premium (DB)* Pension plans* NOK bn 25 # individuals 3,000, yr CAGR**: 23% 2,500, ,000,000 1,500, ,000, , DC DC DB DB Defined contribution *Total Norwegian market. Source: Finance Norway **Compound annual growth rate Defined benefit Issued pension capital certificates Issued paid-up policies Members in pension plans 9

10 Paid up policies a small part of GPF s liabilities NOK bn 300 AUM defined contribution and paid up policies 90% Share of paid up policies** yr CAGR*: 13% 80% 70% 60% 150 5yr CAGR*: 32% 50% 40% % 50 20% 10% Q116 Paid up policy liabilities - market total Paid up policy liabilities - GPF DC AUM - market total DC AUM - GPF 0% Share of paid up policies - market total Share of paid up policies - GPF Source: Finance Norway *Compound annual growth rate ** Paid up policies / (AUM in defined contribution + paid up policy liabilities) 10

11 Strengthening of Solvency II capital margin Issuance of subordinated debt (Tier 2) to improve capital margin and optimise capital structure The transition rule (Solvency II regulation 56) is not applicable for GPF due to lower liabilities calculated according to Solvency II than Solvency I Stress testing of present value on future profit from unit linked portfolio (equities and laps) drives capital requirement (SCR) 11

12 Benchmark Solvency II capital margins % Solvency II margin Q116 including NOK 300m Tier 2 Transitional rule Solvency II Company A Company B Company C Company D Company E GPF Q415 GPF Q116 Source: Interim reports Q Calculations according to Solvency II standard model 12

13 Base case Solvency II margin > 120% with a NOK 300m subordinated bond (Tier 2) issue 150% 140% 130% 120% Solvency II margin projection Solvency II margin 94% in Q year swap (NOK) 1.41% Expected Solvency II margin Q216 ~121% - Given NOK 300m subordinated bond (Tier 2) issue and unchanged swap rate 110% 100% 90% 80% 2016 Q Q Q Q Q Q Q Q4 Expected annual increase in Solvency II margin of ~9 pp - Driven by expected profit after tax and growth in unit linked portfolio Solvency margin including NOK 300m Tier 2 Interest rate bpts Interest rate bpts The Solvency II regulation is principle based. Calculations are based on Gjensidige s understanding of the Solvency II regulation and how it is implemented in Norway. 13

14 Own funds expected to increase more than Solvency II capital requirement going forward NOK Own funds ~NOK 1.00bn Equity increases with profit after tax Increase future profits > increase risk - Driven by UL portfolio growth Net liabilities, interest rate and spread risk related to paid up policies decrease over time - Driven by reduced duration and lower liabilities (payments) NOK Equity Future profits (unit linked) SCR ~NOK 1.07bn Net liabilities (paid up policy) Interest rate and spread risk* Risk on unit linked (equity and laps) Diversification Figures as at , illustrative charts. The Solvency II regulation is principle based. Calculations are based on Gjensidige s understanding of the Solvency II regulation and how it is implemented in Norway. *Risk related to paid up policies. 14

15 Balanced group policy portfolio - flexible, yet conservative investment strategy Stable investment return Group policy portfolio NOK 5.0bn 6.0 % 3% 5.0 % 4.0 % 3.0 % 2.0 % % 12% 61% Bonds at amortised cost Money market Property Other Group portfolio Paid-up policy portfolio Bonds at amortised cost NOK 2.2bn Q of which paid-up policy portfolio NOK 3.4bn 1% Yield to Maturity 4.47% Duration 4.3 Re-investment rate % 15% 18% 66% Bonds at amortised cost Money market Property Other As at

16 Key messages Leading defined contribution pension specialist - Defined contribution and disability pension only - Limited share of paid-up policies managed for stable returns and limited capital requirement Competitive business model - Cost efficient and scalable Positioned for continued growth and increased profitability Integrated part of Gjensidige s small and medium enterprise (SME) offering Potential subordinated bond issue (Tier 2) to strengthen solvency position and optimise capital structure 16

17 Investor relations Janne Flessum Head of IR Mobile: Anette Bolstad Investor relations officer Mobile: Katharina H. Hesbø Investor relations officer Mobile: Address: Schweigaards gate 21, PO Box 700 Sentrum, 0106 Oslo, Norway

18 Organisation GPF Board Mats C. Gottschalk External Auditor* KPMG Gjensidige Pensjonsforsikring AS Torstein Ingebretsen Group Auditor Bente Sverdrup Legal Tom Ødegård Compliance* Hanne Corneliussen Chief Risk Officer* Hina Khan Actuary* Erik Jordet Market Lars Ingmar Eng Customer service Lars Ingmar Eng Product / Analysis Helene Bjørkholt CFO/ Risk Nils Andreas Brekke IT Steffan Lloyd Investments* Gjensidige Investeringsrådgivning Sales* Gjensidige Forsikring ASA *Not directly employed by GPF/ outsourced services 18

19 Legal structure GPF Gjensidige Forsikring ASA 100% Gjensidige Pensjon og Sparing Holding AS 100% Gjensidige Pensjonsforsikring AS 19

20 Delivered good return to defined contribution customers Gross return last 5 years Management fee Sparebank 1 Moderat 10.72% 1.15% Gjensidige Kombinert Pensjonsprofil Balansert 9.40% 0.65% Danica Valg Moderat 9.36% 0.99% Handelsbanken % 0.79% Eika Moderat 8.58% 0.92% Gjensidige Aktiv Pensjonsprofil Balansert 8.10% 1.25% Storebrand Balansert Pensjon 7.82% 0.75% Nordea Aktiva Bedrift % 0.69% KLP P % 0.40% Nordea Aktiva Bedrift % 0.49% DNB Pensjonsprofil % 0.80% Sparebank 1 Moderat basis 7.01% 1.00% Gjensidige Kombinert Pensjonsprofil Balansert Valutasikret 6.80% 0.69% Skagen % 1.05% Source: norskpensjon.no 20

21 Maturities bonds held at amortised cost in the paid up policy portfolio NOK 2.2bn NOK m :Yield 4,8% 2018:Yield 4,1%

22 Group committed to support and optimise capital structure in subsidiaries NOK m Paid-in capital GPF Capital injected* Paid-in capital Capital injected Bond issues (subordinated debt Tier 2) Bond issues (Tier 1) Total *Capital injected including group contribution and paid dividends Gjensidige Bank 22