NORD/LB Group Q Results 26 May 2016

Transcription

1 NORD/LB Group Q Results 26 May

2 Financials NORD/LB reports negative quarterly results (1/2). Group results with -84m significantly below previous year s results, stable operating business performance Loan loss provisions increased significantly to 435 m compared to last year s provisions of 104m Specific valuation allowances increased by 393m, general loan loss provisions increased by 48m. The majority derived from Ship Reduction of shipping portfolio Due to difficult shipping markets and the planned medium-term portfolio reduction to 12-14bn, the share of shipping loans of the total loan exposure will be reduced even further Solid capital ratios With 12.6 per cent for Common Equity Tier 1 (CET1) and 16.7 per cent for total regulatory capital, our ratios are clearly above the required ratios. We will maintain adequate capital to meet all future regulatory capital requirements Total assets nearly unchanged Moderate increase by 1 per cent to 181.9m. We are already below the EU target of 195bn for year-end

3 Financials NORD/LB reports negative quarterly results (2/2). Income statement (in m) 1 Jan 31 Mar Jan 31 Mar 2015 Net interest income Loan loss provisions (llps) Moderate decrease due to low interest-rate levels and asset reduction Increase mainly due to specific valuation allowances for ships Net commission income Stable net commission income Profit/loss from financial instruments at fair value incl. hedge accounting Profit/loss from financial assets 7 2 Profit/loss from investments accounted for using the equity method Administrative expenses Other operating profit/loss Earnings before reorganisation and taxes Trading profit/loss: Based on interest rates. Fair-Value result: Based on interest rates and credit spreads Positive effects from less impairments; lower sale proceeds -7 - Negative results from affiliated companies at equity Moderate reduced staff expenses; contribution to security reserve for landesbanks ( 22m) Negative net effect from redemption of own bonds. Contribution to EU single resolution fund (49 m) Reorganisation expenses -7-6 Net allocations to reorganisation expenses for severance agreements previously agreed to Earnings before taxes Income taxes Consolidated profit

4 Segments Sound segment contributions balance loss from Ship. Earnings before taxes¹ in m 1 Jan 31 Mar Private and Commercial Corporate Markets Energy and Infrastructure Ship Aircraft Real Estate Banking Group Management/ Others, Reconciliations NORD/LB Group ¹ The chart may include minor differences that occur in the reproduction of mathematical operations 4

5 Segments Well diversified business model. as at 31 Mar 2016 Real Estate Banking 14% Aircraft 7% Group Management/ Others 12% Ship 16% Customer loans 1 Total risk exposure amount by business units 1 Private and Commercial 7% Energy-and Infrastructure 13% 106.3bn Corporate 20% Markets 11% 5 as at 31 Mar 2016 Real Estate Banking 10% Aircraft 7% Group Management/ Others 16% Ship 22% Private and Commercial 6% 1 New segmentation since 31 March 2015 Savings bank network (former allocated to corporate customer business) is now allocated to the Markets segment 63.7bn Corporate 21% Marktes 7% Energy and Infrastructure 11%

6 Financials Shipping market prospects let provisions rise. in m Provisions for lending business ¹ 2013¹ 2014¹ 2015¹ 1 Jan - 31 Mar 2015¹ Jan - 31 Mar 2016¹ Net allocations to specific valuation allowances Net allocations to general loan loss provisions Other² ¹ Including proportion of Group Management / Others and Reconciliation ² Include: provisions, additions to receivables written off, direct write-offs of bad debts, premium payments for credit insurance, lump-sum specific loan loss provisions (see Annual Report 2015, Note (21)) 6

7 Segments Shipping loans remain primary driver for risk provisions. Loan loss provisions by segments 1 2 in m 1 Jan 31 Mar Private and Commercial Corporate Markets Energy and Infrastructure Ship Aircraft Real Estate Banking Group Management/ Others, Reconciliations NORD/LB Group ¹ The chart may include minor differences that occur in the reproduction of mathematical operations 2 Since 1 January 2016 we show specific valuation allowances and general loan loss provisions per segment 7

8 Financials Total assets nearly unchanged. Balance sheet data (in m) 31 Mar Dec 2015 Total assets 181, ,998 Total assets nearly unchanged Loans and advances to customers 106, ,878 Still large balance sheet item, slight decrease of loans and advances from ship and aircraft mortgages Loans and advances to banks 22,273 21,194 Increase of short-term loans and advances resulting from money market transactions Financial assets 34,065 34,515 Slight reduction of afs financial assets Customer deposits 58,178 60,597 Decrease especially from money market transactions and savings deposits Equity capital (balance sheet) 8,312 8,513 Fall mainly based on consolidated results and revaluation of pension plans 8

9 Segments Ship. Progress in portfolio transformation. By type of ships 1 as at 31 Mar 2016 Other ships 4% Crude oil tankers 3% MPP General Cargo 8% LPG/LNG tankers 3% Cruise ships / ferries 1% Gas-/Prod.- tankers 7% Offshore 6% MPP Heavy Lift 7% Corporates 7% Chemical tankers 4% Exposure at default: 18.0bn 2 Bulk Carrier - Capesize 3% Bulk Carrier - Handymax 5% Bulk Carrier - Handysize 6% Bulk Carrier - Panamax 4% Container ships - Feeder 4% Container ships - Feedermax 5% Containerships - Handy 4% Container ships - Panamax 6% Container ships - Post-Panamax 7% Container ships - Sub-Panamax 6% Financing of cargo and multipurpose vessels resp. offshore oil & gas Cruise and Ferries For over 45 years NORD/LB offers individual and tailor-made solutions in the segment ship finance worldwide Broad range of shipping finance: from structuring, interest-rate and currency hedging by ECA-covered financing to alternative finance like promissory loans and securitisations. In addition we offer services like out-flagging of ships or M&A consultancy ¹ The chart may include minor differences that occur in the reproduction of mathematical operations 2 New calculation method due to new segmentation compared to 31 Dec

10 Segments Ship. Declining number of ships Allocations in m Financed ships in portfolio Quantity -17% 1,768 1,698 1,544 Loan loss provisions for ship customers ,481 1,490 1,443 1,309 1,256 1, Ships without SVA Ships with SVA , Our anti-cyclical risk-and business strategy Portfolio management Active portfolio management and optimisationby using appropriate securitisation and funding instruments Selective new business Expansion of exposure to cruise ships, ferries, specialised tonnage as well as very selectivelyin offshore. Exposure to merchant shipping will be reduced respectively Transformation Enhancement of businessmodel and portfolio by further regional and asset class diversification. In addition expansion and development of our product range Reduction Additional exploration of possible exit channels Specific valuation allowances ( 2.5bn) and general loan loss provisions total 388m: 16.3 per cent of total exposure Specific valuation allowances (SVA) General loan loss provisions (GLLP) ¹ Total, no SVA breakdown 10

11 Segments Industry outlook shipping: remain at low levels. Feeder/Subpanamax Containerships < 3K TEU Panamax Containerships 3-5K TEU Postpanamax Containerships > 5K TEU Bulker Multi-Purpose Heavy Lift & General Cargo low low medium low low up to 12 mths / mths up to 12 mths / mths up to 12 mths / mths up to12 mths / mths up to12 mths / mths unchanged/ slight increase unchanged/ slight increase unchanged/ slight increase unchanged / slight increase unchanged / unchanged Crude oil tankers Product tankers Other tankers Cruise ships and ferries Off shore high up to 12 mths / mths high up to12 mths / mths medium up to12 mths / mths increased up to12 mths / mths weak up to12 mths / mths Unchanged / decrease unchangd /slight decrease unchanged unchanged decrease / slight decrease Source: NORD/LB sector research based on charter rates and market values (new constructions and second hand) / as at April

12 Financials High quality of total portfolio: 76 per cent in the highest category. NPL ratio in % 2.7% 3.7% 4.2% 4.7% 4.8% Total exposure 2 in bn , default (=NPL) very high risk high risk increased risk reasonable/satisfactory good/satisfactory very good to good ¹ ² 2015² ² ¹ Figures were adjusted, see Interim Report as at 31 March 2012, page 17, footnote 6 resp. Interim Report as at 30 June 2015, page 28 ² Total differences are rounding differences 12

13 Financials Capital ratios strengthened in recent years (CRR, 2014 transitional) (CRR, fully loaded) (CRR, transitional) (CRR, fully loaded) (CRR, transitional) (CRR, fully loaded) 2 CET1 ratio 10.85% 11.84% 10.66% 8.41% 13.07% 12.16% 12.58% 11.94% Total capital ratio 13.84% 14.32% 13.18% 12.40% 16.72% 16.66% 16.67% 16.45% Total risk exposure amount Common Equity Tier 1 (CET1) in m in m 77,863 68,500 69,231 63,675 63,749 8,451 8,112 7,381 8,320 8, ³ 2013¹ ² 2014² 2015² ² ¹ Adjustment of the previous year s figures, please see Annual Report 2014, note(72) ² According to IFRS ³ German GAAP(HGB), Solvability Regulation ³ 2013² 2014² 2015² ²

14 Outlook 2016: negative expectation of earnings. Challenges 2016 Key topics are low interest rates, the development of the euro countries, the situation in shipping markets, increasing competition and digitisation within the financial industry as well as the strength of the US dollar and regulatory requirements Diversity is our strength We are going to increase diversification in our market segments by active risk management in portfolios, concentrating on core clients and selective new business Strengthening of our conservative risk policy For 2016 we expect a significant increase in shipping loan loss provisions. In other business segments of the bank we expect compensation effects. With our robust and diversified business model we will cope with these new challenges Further strengthening of equity capital During the course of the year we will further strengthen our capital ratios. The measure will be flanked by securitisation of loans, active management of total assets and total risk exposure. NORD/LB Group has a sufficient capital base to meet all of the regulatory capital requirements in the foreseeable future Earnings before taxes Against this background we so far expect to show a negative year-end result 2016 for NORD/LB Group (IFRS) as well as for NORD/LB as a single entity (German GAAP) 14

15 Kontakt. NORD/LB Norddeutsche Landesbank Girozentrale Investor Relations Georgsplatz Hannover ir@nordlb.de Gabriele Bödeker(Leiterin Investor Relations) gabriele.boedeker@nordlb.de Tel.: Thomas Breit thomas.breit@nordlb.de Tel.: Carsten Halbe carsten.halbe@nordlb.de Tel.: Christopher Macke christopher.macke@nordlb.de Tel.: Bitte hier Ihr Foto einfügen Svenja Pohlmann svenja.pohlmann@nordlb.de Tel.:

16 Disclaimer. In the United Kingdom this communication is being issued only to, and is directed only at, intermediate customers and market counterparties for the purposes of the Financial Services Authority s Rules ("relevant persons"). This communication must not be acted on or relied on by persons who are not relevant persons. To the extent that this communication can be interpreted as relating to any investment or investment activity then such investment or activity is available only to relevant persons and will be engaged in only with relevant persons. Viewing the following material involves no obligation or commitment of any kind by any person. Viewers of he following material are not to construe information contained in it as a recommendation that an investment is a suitable investment or that any recipient should take any action, such as making or selling an investment, or that any recipient should refrain from taking any action. Prior to making an investment decision, investors should conduct such investigations as they consider necessary to verify information contained in the relevant offering materials and to determine whether the relevant investment is appropriate and suitable for them. In addition, investors should consult their own legal, accounting and tax advisers in order to determine the consequences of such investment and to make an independent evaluation of such investment. Opinions expressed in the material are NORD/LB spresent opinions only. The material is based upon information that NORD/LB considers reliable, but NORD/LB does not represent, guarantee, or warrant, expressly or implicitly, that the material or any part of it is valid, accurate or complete (or that any assumptions, data or projections underlying any estimates or projections contained in the material are valid, accurate or complete), or suitable for any particular purpose, and it should not be relied upon as such. NORD/LB accepts no liability or responsibility to any person with respect to, or arising directly or indirectly out of the contents of or any omissions from the material or any other written or oral communication transmitted to the recipient by NORD/LB. Neither the material nor any part thereof may be reproduced, distributed, passed on, or otherwise divulged directly or indirectly by the party that receives it, to any other person without the prior written consent of NORD/LB. The distribution of the material in certain jurisdictions may be restricted by law and persons into whose possession the material comes are required by NORD/LB to inform themselves about, and to observe, any such restrictions. This presentation does not constitute an offer to sell or the solicitation of an offer to purchase or subscribe for any securities of NORD/LB in the United States. No part of this presentation should form the basis of or be relied upon in connection with any investment decision or any contract or commitment to purchase or subscribe for any securities of NORD/LB. Any offering of securities to be made in the United States will be made by means of a prospectus that may be obtained from NORD/LB and will contain detailed information about NORD/LB, its management and its financial statements. None of NORD/LB s securities may be offered or sold in the United States, without registration under the U.S. Securities Act of 1993, as amended, or pursuant to an exemption from registration therefrom. By viewing the following material, the recipient acknowledges, and agrees to abide by, the aforementioned. 16