Alm. Brand A/S H Analysts

Transcription

1 Alm. Brand A/S H Analysts

2 The Alm. Brand Group Alm. Brand A/S Alm. Brand Bank Alm. Brand Forsikring Alm. Brand Liv og Pension Kjøbenhavnske Re

3 Alm. Brand A/S Highlights H Profit: DKK 105m Not satisfactory Substantial capital losses, impaired claims experience and writedowns by the bank Sustained satisfactory growth in all business areas Non-life: 5% Banking: deposits 18%, loans and advances 11% Pension: 8% Focus on Quality in the customer portfolio Risk vs. price Improved bottom line

4 The Alm. Brand Group Group highlights DKKm Q Q H Forecast April Forecast August Non-life insurance Banking Life insurance Copenhagen Re Other Total

5 The Alm. Brand Group Highlights of non-life operations DKKm Q Q H Gross premiums 1,156 1,193 2,349 Technical result Forecast April Forecast August Inv.return after allocation of interest Profit before tax Run-off result Claims ratio 68% 72% 70% 70% 72% Combined Ratio 93% 95% 94% 93% 95%

6 Alm. Brand, non-life operations Combined ratio Combined ratio ex weather-related and major claims H H Q Q Major claims Weather-related claims* Run-off result* Combined ratio * A negative run-off result indicates income

7 The Alm. Brand Group Highlights of banking DKKm Q Q H Net interest and fee income Costs Other Forecast April Forecast August Value adjustments ex mortgage deeds Impairment charges/provisions Profit before tax Interest margin 1.6% 2.0% 1.8%

8 Tariff The Alm. Brand Group Non-life insurance profitability enhancements Tariff increase Tariff differentiation Selective increases / trimming Analysis of major claims in agricultural business Trimming process extended Costs More for less

9 The Alm. Brand Group Banking profitability enhancements Interest rate increases Increases in Q2 (0.75%) and CIBOR-based Fee increases All business areas evaluate potential for increases Trimming of the loan portfolio 5% least income-generating out or improvement of margin Earnings assessed relative to risk Costs More for less 5% extra cost saving

10 The Alm. Brand Group Group market risk and capital Reduction of risk Capital reduction in Alm. Brand Formue Inflation hedging of workers compensation insurance Risk management Limitation and simplification of framework for manager Reduction of property exposure Trimming of portfolio Diversification of loan portfolio by strengthening other areas Capital No increase in loans and advances Basel II effect

11 The Alm. Brand Group

12 The Alm. Brand Group

13 DKKm The Alm. Brand Group Capital model Times the solvency requirement 30 June December 2007 Non-life insurance 2.4 1,766 1,637 Banking ex partly-owned, listed subsidiaries 1.3 1,780 1,822 Banking, investments in partly-owned, listed subsidiaries Life insurance Reinsurance, shareholders equity Capital target 5,421 5,457 Consolidated shareholders equity 5,145 5,446 Net tax asset Intangible assets Adjusted shareholders equity ex supplementary capital 4,672 4,985 Excess of capital target ex supplementary capital Supplementary capital Excess of capital target incl supplementary capital

14 The Alm. Brand Group Share buybacks Share buyback programme downgraded from DKK 600m to DKK 350m An additional DKK 50m bought back from the 2007 programme total of DKK 400m Equal to a pay-out ratio of 12 in terms of market value at 1 August 2008 Share buyback programme remaining at 1 August totalled DKK 108m, equal to a pay-out ratio of 3

15 The Alm. Brand Group Financial highlights DKKm H H Total income 6,489 6,855 7,721 3,741 4,046 Premium income 4,863 5,026 5,345 2,595 2,702 Income from banking activities , Profit before tax ex minorities 747 1, Profit after tax ex minorities Shareholders equity at period-end 4,935 5,432 5,446 5,471 5,145 Share attributable to minority interests Return on equity before tax ex minority interests p.a. 18% 22% 20% 21% 4% Return on equity after tax ex minority interests p.a. 17% 17% 14% 14% 3% Earnings per share, DKK NAV per share, DKK Price/NAV

16 Relative performance Alm. Brand vs. OMXC Alm. Brand vs. OMXC Alm Brand OMXC20 (DK)

17 Alm. Brand, non-life operations Alm. Brand A/S Alm. Brand Bank Alm. Brand Forsikring Alm. Brand Liv og Pension Kjøbenhavnske Re

18 Alm. Brand, non-life operations Not satisfactory performance DKK 170m Combined ratio: 94.2 Affected by + Sustained growth + Low weather-related expenses - Capital losses on investment portfolio - Substantial major claims in agricultural business - Higher expenses for minor claims in private lines - Discounting of workers compensation - Motor premium reductions

19 Alm. Brand, non-life operations Premium performance Strong premium performance Growth of 5% Growth forecast for the full-year % Focus on profitable growth Seeking only profitable volume Risk vs. price Follow-up on unsatisfactory experience

20 Alm. Brand, non-life operations 4,279 4,578 2,240 2,349 1,131 1,193

21 Alm. Brand, non-life insurance

22 Alm. Brand, non-life insurance

23 Alm. Brand, non-life insurance

24 Alm. Brand, non-life insurance 2005

25 Alm. Brand, non-life insurance Highlights (DKKm) Q Q H H Gross premium income 4,279 4,578 1,131 1,193 2,240 2,349 Premium growth 4.9% 7.0% 8.0% 5.5% 8.3% 4.9% Claims ratio 63.9% 69.0% 65.3% 71.6% 66.8% 69.8% Expense ratio 20.5% 19.6% 21.0% 19.5% 20.7% 20.2% Net reinsurance ratio 3.7% 2.8% 3.3% 3.9% 4.0% 4.2% Combined ratio 88.1% 91.4% 89.6% 95.0% 91.5% 94.2% Profit before tax Profit after tax Shareholders equtiy at period-end 2,169 2,338 2,102 1,840 2,102 1,840 Return on equity before tax p.a. 37% 30% 38% 10% 33% 18% Return on equity after tax p.a. 28% 22% 25% 8% 22% 13%

26 Alm. Brand, banking operations Alm. Brand A/S Alm. Brand Bank Alm. Brand Forsikring Alm. Brand Liv og Pension Kjøbenhavnske Re

27 Alm. Brand, banking Not satisfactory performance: DKK 98m loss Satisfactory growth in deposits and loans and advances Growing interest income Increased interest margin Satisfactory fee performance Substantial capital losses Mortgage bonds Expected decline in interest rates failed to materialise Increase in provisions for bad and doubtful debts Commercial properties/mortgage deeds

28 Alm. Brand, banking

29 Alm. Brand, banking Segmentation of the bank's loans and advances DKK mill. Retail Car finance Agriculture Other commercial Security financing Loans to AB Formue and AB Pantebreve Investments properties Home mortgages Corporate mortgages Property development projects

30 Alm. Brand, banking

31 Alm. Brand, banking

32 Alm. Brand, banking Highlights (DKKm) H H Interest and fee income Net interest and fee income Capital gains and losses Costs Provisions for bad and doubtful debts Profit/loss before tax Shareholders equity at period-end 1,089 1,217 1,365 1,292 1,287 Return on equity before tax ex minority interests p.a. 23% 15% 15% 18% -15%

33 Alm. Brand, life and pension operations Alm. Brand A/S Alm. Brand Bank Alm. Brand Forsikring Alm. Brand Liv og Pension Kjøbenhavnske Re

34 Alm. Brand, life and pension operations Profit: DKK 4m DKK 30m transferred to the shadow account Not expected to be recognised as income in 2008 Not satisfactory investment return due to capital losses on mortgage bonds and equities Part of the loss expected to be recovered Sustained satisfactory growth 8%

35 Alm. Brand, life and pension operations

36 Alm. Brand, life and pension operations

37 Alm. Brand, life and pension operations Technical provisions Market value based on an expected cash flow discounted by the yield curve published by the Danish FSA applied as from 2007

38 Alm. Brand, life and pension operations Investment return Rate of interest paid to customers p.a.4.5% Total investment return p.a. -4.9% Customer returns in H1: Bonds etc. -1.9% Equities -18.9% Properties 2.5% -2.7% Annualised - 5.4% Total equity exposure about 14%

39 Alm. Brand, life and pension operations Composition of profit DKKm Q Q H H Expense result Investment result Change in guaranteed benefits, etc Change in collective bonus potential Risk result Reinsurance result Profit on ordinary activities Tax Profit/loss for the year

40 Alm. Brand, life and pension operations Return on equity before tax DKKm Q Q H H Return on investment allocated to equity Result of portfolios without bonus entitlement Risk premium Share of expense and risk results Calculated return on equity Reversal of/transfer to shadow account Profit/loss for the period before tax

41 Alm. Brand, life and pension operations Highlights DKKm H H Gross premiums Profit before tax Profit after tax Provisions for insurance contracts 11,416 11,294 11,049 10,980 10,916 Shareholders equity 1,278 1, Return on equity before tax p.a. 13% 7% 12% 7% 1% Collective bonus potential Bonus rate 3.1% 4.7% 4.0% 4.3% 0.3%

42 Other business areas Copenhagen Re, profit: DKK 50m Significantly better than anticipated Lower-than-expected investment result Settlement concerning WTC claims Substantial reduction in risk of losses on overall portfolio Other, loss: DKK 21m Shared group costs and a number of dormant companies

43 Alm. Brand A/S H Analysts