Investor Presentation The Helaba Group Frankfurt / Main, November 2015
Agenda 2 1 Helaba Profile 2 S Group Strategy 3 Business Development & Asset Quality 4 Funding
Helaba: Universal bank with strong regional focus 3 Key numbers for Q3 2015 Total assets: 178.4 bn CET-1-ratio phased-in 1 : 13.1% CET-1 ratio fully loaded 1 : 12.0% Total capital ratio 1 : 18.3% Employees: ca. 6,200 Retail customers: Results for Q3 2015: Risk weighted assets: > 1.8 mn 485 mn (pre-tax, IFRS) 55.3 bn Leverage Ratio: 3.9% 1) According to IFRS / CRR
Helaba s Profile Universal Bank with Strong Regional Focus 4 Strategic Business Model Universal bank integrating wholesale, retail and public development & infrastructure business Core Markets Universal Bank with strong focus on Germany and presence in carefully selected international markets Savings Banks Group Central bank for 164 German savings banks (40% of all savings banks in Germany); close integration in S Group Hesse-Thuringia with joint ratings Customer Business Stable customer business (>50% of total assets); reflecting Helaba s close ties to the real economy Funding Well-balanced mix of instruments and high level of market acceptance; sustainable liquidity management throughout Helaba group Helaba Rating Excellent ratings from the three leading rating agencies; joint ratings with savings banks in Hesse-Thuringia; ranked among the top German banks
Helaba s Stable Strategic Business Model: Three Core Business Units 5 Helaba a Universal Bank with strong Regional Focus Wholesale Business S-Group Business, Private Customers and SME Business Public Development and Infrastructure Business Business Division: Real Estate Corporate Finance Financial Institutions and Public Finance Global Markets Asset Management Transaction Banking Frankfurt am Main. Erfurt. Dusseldorf. Kassel. London Paris. New York. Zurich. Madrid. Moscow. Shanghai. Singapore
Helaba s Ownership Structure Dominated by the Savings Banks Sector (88%) 6 Share Capital Distribution Savings Banks and Giro Association Hesse-Thuringia 8.1% 4.05% 4.75% State of Hesse Free State of Thuringia 68.85% 4.75% 9.5% Savings Banks Association Westphalia-Lippe Rhenish Savings Banks and Giro Association Savings Banks Association (DSGV) as trustee 1 1) Trustee for the Regional Savings Banks Support Funds and for the Deposit Reserve of the Landesbanks
Stable Ratings from the leading International Rating Agencies: Upgrade by Moody s in 2015 7 Development of Helaba s long-term ratings AAA/Aaa 1 Termination of maintenance obligation and statutory guarantee 2 Crash of Lehman Brothers 3 Begin of the Europ. sovereign debt crisis 4 EBA Banking stress tests ECB AQR and stress test 5 AA+/Aa1 AA/Aa2 AA-/Aa3 A+/A1 A/A2 A+ A 1 1 A1 A-/A3 BBB+/Baa1 BBB/Baa2 : : July 2005 Changes in S&P s Rating methodology Fitch introduces its viability rating 2006 2007 2008 2009 2010 2011 2012 June 2012 6 7 8 Changes in Moody s Rating methodology 2013 Changes in Moody s Rating methodology 2014 2015 9 1) Joint group rating (Sparkassen-Finanzgruppe Hessen-Thüringen)
Agenda 8 1 Helaba Profile 2 S Group Strategy 3 Business Development & Asset Quality 4 Funding
Helaba and Savings Banks in Hesse-Thuringia A Single Economic Unit with a unique Franchise A single Economic Unit 9 S Group Hesse-Thuringia S SME / Retail Customers in the Region Platform for Products and Services Joint Risk Management Helaba S Wholesale Business International Markets S Group Hesse-Thuringia Results 2014 Total assets: 265 bn Earnings before taxes (IFRS): 1,649 mn Capital ratio: 17.0%, Total capital ratio: 24,6% Return on capital (pre tax): 8.7% Cost-income ratio: 64.3% Joint Market Presence Joint business strategy Full market coverage (retail and wholesale business) Clear allocation of customer responsibility Co-ordinated range of products Joint Risk Management Uniform risk management strategy Risk monitoring system with early warning indicators Risk-adjusted contributions to the group s reserve fund Joint Group Reserve Fund Integrated in joint risk management system Approx. 508 mm in addition to existing nationwide voluntary support mechanisms as at 31.12.2014 Direct legal investor protection in addition to institutional support Consolidated Accounts Audited consolidated group accounts since 2003 Earnings before taxes in 2014 (IFRS): 1,649 mn Group rating from Fitch Ratings (A+ and a+) and Standard & Poor s (A)
Helaba s S Group Business 10 Frankfurter Sparkasse 4 th largest savings bank in Germany Fully owned by Helaba LBS Building and loan association Product provider for savings banks Integrated business unit 1822direkt Direct Banking Unit of Frankfurter Sparkasse Frankfurter Bankgesellschaft Zürich/Frankfurt Private Banking subsidiary Fully owned by Helaba S-Group business within Helaba Group 1 2 3 Product and service provider to all savings banks S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S S Central Bank function for savings banks S Group Hesse-Thuringia Central Bank Function Single economic unit with 49 savings banks in Hesse- Thuringia S Group Cooperation NRW & Brandenburg Legally installed Central Bank Function Cooperation Agreements with all 114 savings banks
Helaba Leading S Group Bank within the German Savings Banks Association 11 Hesse-Thuringia Home Region with central bank function for associated savings banks Savings banks and the Federal States of Hesse and Thuringia are Helaba`s shareholders Successful business model of a single economic entity with S Group`s savings banks; regional support funds, consolidated annual accounts and group ratings Head offices in Frankfurt / Main and Erfurt Rhineland-Palatinate/Bavaria/ Baden-Wurttemberg Target Regions Local sales offices in Munich, Stuttgart and Frankfurt / Main North Rhine-Westphalia Home Region with central bank function for associated savings banks Savings banks associations of NRW are Helaba`s shareholders S-Group agreement as basis for cooperation; regional support funds in NRW Branch office in Düsseldorf Brandenburg Home Region with central bank function for associated savings banks and S-Group agreements Sales Office Berlin Other regions Wide range of products offered Sales team located in Frankfurt / Main As central bank Helaba is S-Group bank for 40% of the German savings banks
Strengthened market position Through the acquisition of NRW savings banks business 12 Helaba is the number two address for payment transactions within Germany and is expanding its services, especially for corporate clients and the public sector With the takeover of WestLB s certificate platform, Helaba is now one of the leading providers of certificates in the German market In Corporate Finance, the largest regional market in Germany, North Rhine-Westphalia, has become part of the core region of Helaba In the security/safe custody business, the volume under administration has doubled through the takeover of the WestLB business With the legal transfer of the central bank function for the savings banks in North Rhine-Westphalia and Brandenburg, Helaba has become the central bank and service provider for 164 savings banks across four states
Agenda 13 1 Helaba Profile 2 S Group Strategy 3 Business Development & Asset Quality 4 Funding
Consolidated Balance Sheet of Helaba Group for 9M 2015 (IFRS) 14 30.09.2015 31.12.2014 Change in billion in billion in billion % Loans and advances to banks incl. cash reserves 19.5 21.6-2.1-9.7 Loans and advances to customers 93.5 91.1 2.4 2.6 Impairments on receivables -1.0-1.0 - - Assets held for trading 28.5 31.3-2.8-8.9 Positive market value of derivatives not held for trading 5.0 5.8-0.8-13.8 Financial investments, incl. companies accounted for using the equity method 28.9 26.6 2.3 8.6 Other assets 4.0 4.1-0.1-2.4 Total assets 178.4 179.5-1.1-0.6 Liabilities due to banks 37.4 35.6 1.8 5.1 Liabilities due to customers 48.8 45.3 3.5 7.7 Securitised liabilities 51.0 48.3 2.7 5.6 Liabilities held for trading 20.4 29.2-8.8-30.1 Negative market value of derivatives not held for trading 4.7 5.4-0.7-13.0 Provisions/ other liabilities 2.9 2.9 - - Subordinated capital 5.7 5.4 0.3 5.6 Shareholders' equity 7.5 7.4 0.1 1.4 Total liabilities 178.4 179.5-1.1-0.6 Business Volume 205.5 204.9 0.6 0.3
P&L of Helaba Group for 9M 2015 (IFRS) 15 01.01. 30.09.2015 01.01. 30.09.2014 Change in million in million in million in % Net interest income 983 978 5 0.5 Provisions for loans and advances -114-62 -52 83.9 Net interest income after provisions for loans and advances 869 916-47 -5.1 Net commission income 245 229 16 7.0 Net trading income 119 121-2 -1.7 Result of hedges/derivatives -1 72-73 - Result from financial investments (incl. result from companies accounted for using the equity method) 13 24-11 -45.8 Other operating result 147 57 90 157.9 General administration expenses -907-912 5 0.5 Earnings before tax 485 507-22 -4.3 Taxes on income -166-167 1 0.6 Consolidated net income 319 340-21 -6.2
Securities portfolio (1): High quality and short terms 16 Breakdown of Helaba's securities portfolio by maturity bands and rating categories 0-2 years 2-5 years 5-10 years > 10 years Total AAA in bn ABS 0.0 0.0 0.0 0.0 0.0 AA 37.9% Pfandbriefe/ Covered Bonds 1.4 2.5 1.2 0.1 5.2 A 31.5% Corporates 0.1 0.5 0.7 0.0 1.3 25.2% Financials 12.4 6.3 2.7 0.1 21.4 Government 4.3 5.1 4.4 0.3 14.1 BBB 4.9% 0.5% Total 18.2 14.4 9.0 0.5 42.0 Non-investment-grade As of Sept. 30, 2015 95% of the securities portfolio is rated AAA to A 45% of the securities portfolio matures within two years Financials make up 51% of the portfolio The ABS portfolio is almost entirely eliminated or expired
Overview of the Impairments on Loans and Advances 17 Composition of the Provision for Losses on Loans Break down on Segments in million. in million 01.01.- 30.09.2014 01.01.- 30.09.2015 Real Estate 25 Net-risk provision 62 Net-risk provision 114 Corporate Finance 55 Individual allowances 148 Financial Markets 0 Global individual allowances -3 S-Group Business, Private Customers and SME Business -9 Portfolio allowances 6 Provisions -10 Direct impairments on receivables -27 Public Development a. Infrastructure Business Others Consolidation/Reconciliation -1 0 44-35 -15 5 25 45 65 As of Sept. 30, 2015
Capital Ratios 18 Development of capital ratios (Helaba Group) in billion Risk weighted assets Capital Ratio Tier-1-Ratio CET1 Ratio ("phased-in") 65 17.4% 18.5% 18.3% 20% 60 14.4% 9.6% 15.3% 10.1% 15.9% 11.2% 12.8% 12.5% 13.4% 13.1% 15% 10% 55 60.8 57.2 57.3 5% 54.1 53.8 55.3 50 2010 2011 2012 2013 2014 9M 2015 0% CET 1-Ratio fully loaded as of September 30, 2015 at 12.0%.
Key Financial Ratios for 9M 2015 19 01.01.-30.09.2015 01.01.-30.09.2014 Return on equity (before taxes) 8.8% 9.3% Cost-income ratio 60.2% 61.6% 30.09.2015 31.12.2014 CET 1-Ratio ( phased-in ) 13.1% 13.4% CET 1-Ratio ( fully loaded ) 12.0% 11.8% Total capital ratio 18.3% 18.5% Risk-weighted assets in billion 55.3 53.8 Own funds, total in billion 10.1 10.0 30.09.2015 31.12.2014 Leverage Ratio 3.9% 4.0%
Agenda 20 1 Helaba Profile 2 S Group Strategy 3 Business Development & Asset Quality 4 Funding
Helaba Ratings on a high level 21 Unguaranteed ratings Agency Moody s Fitch Ratings Standard & Poor s Long-term rating A1 A+ 1 A 1 Short-term rating P-1 F1+ 1 A-1 1 Viability rating/ SACP - a+ 1 A 1 Public Pfandbriefe Aaa AAA - Mortgage Pfandbriefe - AAA - Guaranteed ratings 2 Agency Moody s Fitch Ratings Standard & Poor s Long-term rating Aa1 AAA AA- Source: Moody s Investor Service, Fitch Ratings, Standard & Poor s as of June 22, 2015 1) Joint group rating (Sparkassen-Finanzgruppe Hessen-Thüringen) 2) With statutory guarantees of owners ( mit Gewährträgerhaftung )
Funding Strategy Strong regional engagement as success factor during the financial crisis 22 Funding Strategy Continued matched funding of new business Expand the already strong position within the German investor base and further develop the international investor base Intensive marketing of Helaba s solid Credit Story in and outside Germany Further develop the product and structuring capacity through the issuance programmes Funding Volume Covered Unsecured Total 2014 6.3 bn 8.9 bn 15.2 bn 2015 planned 4.5 bn 7.5 bn 12.0 bn Funding Programmes EUR 35 bn Euro Medium Term Note Programme Domestic issuance (Basisprospekt) EUR 10 bn Euro-CP/CD Programme EUR 6 bn French CD Programme USD 5 bn USCP Programme Broad Liquidity Access EUR 33 bn collateral pool for German covered bonds ( Pfandbriefe ) EUR 35 bn securities eligible for ECB / central bank funding EUR 16 bn retail deposits within Helaba Group EUR 88 bn deposits within the S Finance Group Hesse-Thuringia (as at Dec. 31, 2014)
Funding Sustainable liquidity management and high level of acceptance in the market 23 Outstanding medium and long-term funding ( 1 year): 87.4 bn Q3/2015 2014 2013 in mn in mn in mn Covered securities ( Pfandbriefe ) 29,826 27,734 24,857 - Public sector 21,361 21,718 19,208 18 % 24 % Public Sector Pfandbriefe Mortgage Pfandbriefe - Mortgage backed 8,465 6,016 5,649 Senior, unsecured bonds 19,806 25,120 30,862 Borrower's notes 21,969 23,367 21,475 25 % 23 % 10 % Senior, unsecured notes & bonds Borrower s notes Miscellaneous * 15,760 16,150 17,475 Summe 87,361 92,371 94,669 Miscellaneous * Subordinated bonds / participation rights certificates / silent deposits / earmarked funds As at Sept. 30, 2015
Medium- and long-term funding ( 1 year) in Q3/2015 Diversified funding mix 24 Breakdown by Investor Breakdown by Product Domestic & international Investors Unsecured bank notes & bonds Public sector Pfandbriefe 1.5 bn 36% 4.9 bn Mortgage Pfandbriefe Savings Banks (Institutional) 48 % 2.5 bn Borrowers notes & other loans 1.7 bn Savings Banks (Retail) 16 % 0.3 bn 0.7 bn Subordinated debt Earmarked funds ( EIB, KFW, LfA) Medium- and long-term funding for Q3/2015: 11.6 bn As at Sept. 30, 2015
Sustainability-led liquidity management throughout the Helaba Group 25 Matched banking book bn 100 90 80 70 60 50 40 30 20 10 0 1 2 3 4 5 6 7 8 9 10 11 > 11 Assets Liabilities Years As at Sept. 30, 2015
Contacts 26 Dirk Mewesen General Manager Head of Asset & Liability Management Tel (+49) 69 / 91 32 46 93 Dirk.Mewesen@helaba.de Henning Wellmann Head of Liability Management & Funding Tel (+49) 69 / 91 32 31 42 Henning.Wellmann@helaba.de Martin Gipp Head of Funding Tel (+49) 69 / 91 32 11 81 Martin.Gipp@helaba.de Nadia Landmann Debt Investor Relations / Funding Tel (+49) 69 / 91 32 23 61 Nadia.Landmann@helaba.de Landesbank Hessen-Thüringen Neue Mainzer Strasse 52-58 60311 Frankfurt am Main, Germany
Disclaimer 27 This presentation and the information contained herein do not constitute or form part of a prospectus or other offering document in whole or in part and should not be construed as an offer or solicitation to buy or sell any securities or any related financial instruments and should be regarded as informative only. All information is as of the date of publication and can change without any further notice. Whilst every effort has been taken to ensure the accuracy of the presentation material, no guarantee is given nor liability assumed for the information contained herein. Helaba does not offer any advice as regards to taxation and accounting or legal matters. From the past result, performance or achievements no conclusions as to the future results, performance or achievements can be drawn. The Q3/2015 group financial information are based on the audited, non-attested IFRS group accounts. Therefore, all calculations based upon these figures are preliminary and should be regarded as informative only. All forms of distribution of this document require the prior written approval by Helaba. Landesbank Hessen-Thüringen Girozentrale, Frankfurt am Main / Erfurt