Swedbank A leading Nordic-Baltic bank

Transcription

1 Swedbank A leading Nordic-Baltic bank

2 A brief history of Swedbank 1820 the first savings bank was founded in Gothenburg 1915 the first agricultural cooperative bank was founded regional agricultural cooperative banks merged to form Föreningsbanken 1992 there was a merger between 11 regional savings banks 1994 Föreningsbanken was listed on the Stockholm stock exchange 1995 Sparbanken Sverige IPO and stock listing 1997 FöreningsSparbanken formed through merger between Sparbanken and Föreningsbanken 2005 Swedbank acquired 100% of Hansabank

3 A brief history of Hansabank 1991 Hansabank s first branch established 1995 Hansabank started operations in Latvia 1996 Hansabank acquired 100% of Deutsche-Lettische Bank in Latvia 1996 Hansabank started operation in Lithuania 1997 Hansabank acquired a stake in Hoiupank 1999 Swedbank acquired more than 50% of Hansabank 2002 Hansabank started operation in Russia 2004 Hansabank acquired Kvest bank in Moscow

4 Mission, vision and values Mission By understanding and acting upon our customers needs, we can offer them the best financial solutions and thereby help them to improve their financial situation. In this way, we can continuously increase our company s value and serve as a positive force in society. Vision Values We want to be the leading financial institution in the Nordic and Baltic region. By leading we mean having in each home market: the highest level of customer satisfaction, the best profitability, and the most attractive employer We believe that the Group s healthy profits and increased international recognition are the result of a performance-orientated culture, clear and transparent communication, a willingness to change, and the strong commitment of our employees.

5 A successful Group Swedbank Corporate Bank of the Year in Sweden Sweden s Best Bank for Entrepreneurs for 3 consecutive years Voted Sweden s most attractive financial employer and top 8 overall Hansabank Best bank in Estonia for 6 consecutive years Bank of the year in Lithuania for the first time in 2005 Most highly respected company in Latvia in 2005 Winner of the Entrepreneurship Award 2005

6 Swedbank Group today Home markets, universal banking Sweden - Swedbank Estonia - Hansapank Latvia - Hansabanka Lithuania - Hansabankas Collaboration/alliances Finland % ownership in Aktia Other markets, niche banking Denmark - Swedbank branch Finland - Swedbank branch Norway - Swedbank branch, investment banking through First Securities (51%) Russia - Corporate banking and leasing in Moscow, Kaliningrad and St Petersburg US - Merchant/investment and corporate banking in New York Luxembourg - banking for Swedish expatriates China - Rep. office in Shanghai Japan - Rep. office in Tokyo Spain - Rep. office in Marbella

7 Geographical reach Estonia Sweden Population 9.1 M Employees 8,921 Private customers 4.1 M Of which Internet customers 2.2 M Corporate customers 254,000 Branches 475 ATM s 859 Cards 3.3 M Population 1.3 M Employees 2,912 Private customers 1.2 M Of which Internet customers 0.8 M Corporate customers 80,000 Branches 97 ATM s 571 Cards 1.0 M Latvia Population 2.3 M Employees 2,156 Private customers 0.7 M Of which Internet customers 0.5 M Corporate customers 42,000 Branches 74 ATM s 234 Cards 0.8 M Lithuania Russia Population 143 M Employees 175 Branches* 3 *St Petersburg, Moscow and Kaliningrad Population 3.6 M Employees 2,930 Private customers 2.8 M Of which Internet customers 0.7 M Corporate customers 70,000 Branches 120 ATM s 312 Cards 1.2 M

8 Swedbank s customers Households Group excluding Baltic Banking 4.1 M customers Public sector Group excluding Baltic Banking 219 municipalities Baltic Banking 4.7 M customers Group excluding Baltic Banking 22 county councils Corporate customers Group excluding Baltic Banking 254,000 Baltic Banking 193,000 Unions Cooperative Religious

9 Swedbank Sep 30, 2006 Profit for the period Lending Baltic Banking 26% Baltic Banking 14% Group excluding Baltic Banking 74% Group excluding Baltic Banking 86% Customers, private Baltic Banking 53% Baltic Banking 38% Branches Group excluding Baltic Banking 47% Group excluding Baltic Banking 62%

10 GDP growth 10 % Sweden Estonia Latvia Lithuania Russia E 2007E

11 Market positions

12 Market position Sweden Mortgage loans Household deposits Equity linked bonds Consumer credits Mutual fund investments Individual pension savings Premium pension savings Card clearance transactions Internet bank Telephone bank Real estate brokerage Strong positions in Unit-linked insurance Business deposits Leasing Stock brokerage Corporate lending

13 The Swedish banking market Mortgage lending, total market SEB 12% SBAB 11% SHB 28% Others 2% Deposits, retail Swedbank 30% Nordea 17% Danske 16% SEB 6% Bank lending, retail Others 16% Skandia 5% SHB 12% Swed-- bank 15% Fund management Nordea 10% FSR 20% Bank lending, corporate Danske 11% SEB 15% Others 14% SHB 26% Deposits, corporate Swed - bank 19% Nordea 15% SEB 13% Skandia 4% SHB 16% Others 9% Nordea 18% Swedbank 26% FSR 14% Others 22% SEB 16% Skandia 4% SHB 14% Swedbank 15% FSR 5% Swedbank 22% LF 4% Nordea 14% SEB 25% SHB 22% Others 13% Nordea 20%

14 Market shares Swedish banking As of Sep 30, % Total lending* Retail mortgages Deposits Fund management** Retail bonds * Market share as of Aug 31, 2006 **Market share as of June 30, 2006

15 Baltic Banking shares Estonia, deposits Latvia, deposits Lithuania, deposits Sampo 10% SEB 26% Others 9% Hansa bank 55% Others 43% Nordea 4% DnB Nord 4% SEB 15% Hansa bank 19% Parex 18% Snoras 10% Others 16% DnB Nord 11% Sampo 3% Hansa bank 30% SEB 30% Estonia, lending Latvia, lending Lithuania, lending Sampo 11% SEB 30% Others 12% Hansa bank 46% Nordea 8% Others 24% Parex Bank 12% SEB 20% Hansa bank 27% DnBNord 10% Sampo 9% Others 15% DnB Nord 15% Snoras 2% Hansa bank 24% SEB 35% Market shares as of June 2006

16 Market Share, Baltic Banking 60 % Estonia Latvia Lithuania 10 0 Total lending Deposits

17 Business volumes

18 Lending Swedbank Group excl repurchase agreements Sep 30, 2006 Businesses, excl. real estate mgmt. 26% (25%) Real estate management 20% (20%) Municipalities 2% (2%) Bank lending, private individuals 5% (5%) Hansabank, private individuals 5% (4%) Other, private individuals 1% (1%) Swedbank Mortages, private individuals 41% (43%) Figures in parantheses refer to December 31, 2005

19 Savings and Investments Swedbank Group Sep 30, 2006, SEK 803 bn (705) Fund savings, 41 % (42 %) Pension & insurance, 8 % (7 %) Retail bonds, 3 % (2 %) Household deposits, SEK, 22 % (22 %) Discretionary management, 3 % (3 %) Other, foreign currency, 7 % (8 %) Household deposits, foreign currency, 4 % (4 %) Other, SEK, 12 % (12 %) Figures in parantheses refer to Sep

20 Debet and Credit cards Q3, 2006 vs. Q Number of card purchases in Sweden + 15 percent to 108 million Number of acquired card transactions + 23 percent to 194 million Number of debit cards in issue in Sweden + 3 percent to 3.3 million Number of debit cards in issue in Baltic states + 18 percent to 3.0 million 821,619 credit cards issued in Sweden and Norway through EnterCard* 50%

21 Strategy

22 Group strategy Growth areas in Sweden - strengthen positions in areas with high growth - be the natural choice for affluent customers and medium-sized companies Remain market leader in lending, asset management and payments - strengthen presence in large cities and growth regions

23 Group strategy Nordic/Baltic growth - Retail banking in Nordic/Baltic region - Expand in selected product areas - Establish branch operations in major Nordic cities

24 International expansion 1. Full service retail banking in Nordic and Baltic regions controlling share any acquisition should give a positive contribution to group ROE longterm 2. Acquisition-led expansion within certain product areas economies of scale cross-border customer value additional distribution channels 3. Greenfield investments in Nordic metropolitan retail operations 4. In addition: Follow your customer

25 Delivering in line with the strategy Acquisitions First Securities (May 05) 51 % of shares; (June 02) 33.3% of shares; Hansabank Group (Apr 05) acquired 100% of outstanding shares Kvest Bank (Mar 05) Hansabank acquired 100% of shares EnterCard (Sep 03) acquired 100% of shares Greenfield investments Helsinki Branch (Oct 05) Copenhagen Branch (May 05) Divestments SpareBank 1 Gruppen (June 06) sold remaining 19,5%; (June 04) reduced holding from 25 to 19.5% Aktia (Sep 05) reduced holding from 9.6 to 1.1%; (Jul 05) reduced holding from 19,8% to 9,6%; (Dec 04) reduced 24,4% to 19,8% Kundinkasso AB (July 05) sold 100% of shares to Lindorff Sverige AB FIH (Sep 04) sold 100% of outstanding shares Erste Bank (June 03) disposed of 3.9% stake Joint Ventures EnterCard (June 05) J-V with Barclaycard International

26 Developing the Nordic business Extension of the branch network (Copenhagen, Denmark and Helsinki, Finland) Strengthening investment and merchant banking operations in Norway Capturing credit card market potential

27 Group financial objectives The return on equity shall exceed the average of all other large, publicly listed Nordic banks (SHB, SEB, Nordea, Danske Bank and DnB NOR) and be at least 20 percent higher than the long-term riskfree rate of interest plus a normal risk premium The Group s cost/income ratio shall not exceed 0.5 The primary capital ratio (tier 1) shall be 7 percent over the long term At least 40 percent of net profit shall be distributed to the shareholders as dividend.

28 Financial targets

29 Swedbank ROE compared to peers 30,0 % 25, ,0 15, ,8 20,2 19,2 20,2 10,0 5,0 0, Q1, 2006 Q2, 2006 Q3, 2006 Nordic peers* Swedbank * The peer group consists of SEB, Nordea, SHB, DnB NOR and Danske Bank.

30 C/I Ratio 0,80 0, Target 0,40 0,20 0,00 Q1-02 Q2-02 Q3-02 Q4-02 Q1-03 Q2-03 Q3-03 Q4-03 Q1-04 Q2-04 Q3-04 Q4-04 Q1-05 Q2-05 Q3-05 Q4-05 Q1-06 Q2-06 Q3-06 Adjusted according to IFRS from Q1, 2004

31 Primary Capital ratio 9% 8.2% 8% 7.1% 7.1% 7.2% 6.9% 7% 6.5% 6.5% 6% Target dividend ratio 5% 4% 3% 2% 1% 0%

32 Dividend SEK/Share Dividend ratio, % * Target Dividend per share Dividend ratio * Dividend ratio for the year excluding capital gain

33 Financial highlights

34 Profit trend Swedbank Group Operating profit SEK M Total assets SEK bn Q1-02 Q2-02 Q3-02 Q4-02 Q1-03 Q2-03 Q3-03 Q4-03 Q1-04 Q2-04 Q3-04 Q4-04 Q1-05 Q2-05 Q3-05 Q4-05 Q1-06 Q2-06 Q Operating profit Total assets Operating profit according to IFRS as of Q1, 2004

35 Highlights Q3, 2006 Consolidating and raising key market shares The share of new mortgage loans to private customers in Sweden rose to 31 percent (24) For household deposits, the market share for new savings in Sweden was 27 percent (25.2) The share of bank lending was 50.8 percent (48.4) in Estonia, 28.9 percent (31.0) in Latvia and 28.7 percent (35.5) in Lithuania. The figures refers to 31 Aug 2006 and the figures in brackets refer to Sep

36 Group Income Statement SEK M Q Q % Q % Net interest income 3,895 3, ,860 1 Net commission income 2,109 2, , Net gains and losses on financial items at fair value 757 1, Other income , Total income 7,164 7, , Staff costs 1,772 1, ,700 4 Profit-based staff costs Other expenses 1,417 1, ,315 8 Total expenses 3,490 3, ,364 4 Profit before loan losses 3,674 3,676 5, Loan losses Operating profit 3,741 3, , Tax Profit for the period 2,935 2, , Attributable to shareholders of Swedbank 2,911 2, ,037 28

37 Balance Sheet Sep 30, 2006 Assets Bank lending retail 94 Bank lending corporate and other 347 Liabilities and equity Deposits retail 215 Deposits corporate and other 175 Mortgage lending retail and corporate 500 Debt securities in issue etc 582 Lending credit institutions 159 Interest bearing securities 98 Derivatives 24 Other assets 119 Deposits credit institutions 124 Derivatives 24 Other liabilities163 Equity 58

38 Shareholders Shareholders, Sep 30, 2006 % Savings bank foundations 21.3 Savings banks 8.5 Fourth National Pension Fund 3.2 Franklin-Templeton Funds 3.0 Robur Funds 2.6 SPP/SHB Funds 2.5 Swedbank profit-sharing funds 2.4 AMF Pension 1.9 AMF Pension 1.8 AFA insurance 1.8 Other international investors 24.3 Other Swedish institutions 15.4 Swedish general public 11.3 Distribution of shareholders International investors 27.3% (25.4%) Savings bank foundations 21.3% (21.1%) Swedish institutions 31.6% (34.1%) Savings banks 8.5% (8.2%) Swedish general public 11.3% (11.2%) Figures in brakets refer to December Number of shares amount to 515,373,412 Number of shareholders: 325,936

39 Governance Group Executive Management Board of Directors Strategic Direction Internal Audit Business Control President and CEO Group Senior Management Staffs One group concept 60 top executive managers Group Staffs Reviewed Risk Control Fully integrated Swedish Banking Retail and corporate banking including asset management: North Region Mälardalen Region East Region West Region Öresund Region Customer Offerings and Products Baltic Banking Retail and corporate banking including asset management: Estonia Latvia Lithuania Corporate banking: Russia Swedbank Markets Investment and merchant banking, customer responsibility for financial Institutions: Swedbank Markets, Sweden First Securities, Norway Swedbank New York Swedbank Shanghai Shared Services IT development, Sweden IT operations, Sweden Common support functions Strategic and International Banking Swedbank Luxembourg (banking for Swedish expatriates) Swedbank Copenhagen Swedbank Helsinki Swedbank Oslo Swedbank Tokyo Savings banks business

40 Ratings S&P Moodys Fitch Short Long Short Long BFSR* Short Long A-1+ AAA P-1 Aaa A F 1+ AAA A-1 AA+ P-2 Aa1 B+ F 1 AA+ A-2 AA P-3 Aa2 B F 2 AA A-3 AA- Aa3 C+ F 3 AA - A+ A1 C A+ A A2 D+ A A- A3 D A- BBB+ Baa1 E+ BBB+ BBB Baa2 E BBB BBB- Baa3 BBB- In October 2005 the ratings instiute Standard & Poor s raised the outlook for Swedbank s long-term rating to positive fram stable. = Swedbank = Hansabank = Swedbank Mortage * Bank Financial Strength Ratings