investor presentation 21 feb 2007 - nordea.com · investor presentation 21 february 2007. ceo...

Investor Presentation21 February 2007

CEO Presentation

3

Record results following reinforced organic growth strategy – RoE at all time high 22.9%

Operating profit up 25% to EUR 3,820m (EUR 3,048m)Net profit up 39% to EUR 3,153m (EUR 2,269m)Earnings per share EUR 1.21 (EUR 0.86) up 41%Total dividend per share EUR 0.49, up 40% corresponding to total dividend payment of EUR 1,271m. Income up 12% to EUR 7,377m (EUR 6,573m in 2005)Costs up 4% - reflecting higher business activityGap between revenue and cost growth 5.4%-points, excl. full impact of IMB saleCost/income ratio continued down to 52%Positive net loan losses of EUR 257m (EUR 137m) – 11th consecutive quarter with net recoveries Return on equity 22.9% (18.0%)

4

Strong momentum in all business areas

Total lending up 14%Mortgage lending up 15%SME lending up 12%Consumer lending up 12% - non collateralised up 17%Number of credit cards increased by 25%Strong growth in Private BankingIncreased cross-selling of Markets’ products to SMEsStrong increase in capital markets transactions with large corporatesNet written premiums in Life up 22%

5

Continued growth in operating income

EURm

6,1276,573

7,377

0500

1,0001,5002,0002,5003,0003,5004,0004,5005,0005,5006,0006,5007,0007,500

2004 2005 2006

YoY

Up 12%Up 9% excl. sale of IMB shares

Steady increase in net interest income Volume growth more than compensating for lending margin pressure. Improved deposit margins

Higher commission income – fuelled by savings products Net/gains losses – strong increase in customer driven financial transactions

Q4oQ3

Strong increase when adjusting for IMBAccelerating business momentum in all Business Areas

6

Higher share of income being non-interest income

Increased proportion of non-interest income 48%

Excl. IMB sale 46%

Individual client focused advice and product offering increasingly important

A more capital efficient way to finance growth in earnings

Risk diverse revenue streams0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2004 2005 2006

Net interest income Non-interest income

57%

43%

56%

44%

52%

48%

EURm

7

Revenue growth in Nordea

6,573

Income 2006

Volumes, margins lending

Savings: AM, Life and savings accounts

Markets

+ 38

+224

+168

Income 2005

EURm 7,377+175

Other

+199

Gain from sale of IMB shares

+804

8

4%17%– of which non collateralised lending

7%12%– SME lending

16%15%– CIB lending excl. Markets

6%9%Deposits, total

14%

12%

8%

12%

15%

14%

YoY

16%– CIB deposits excl. Markets

8%– SME deposits

1%

2%

5%

6%

Q4oQ3

– Household deposits

– Consumer lending*

– Mortgage lending

Lending, total

Robust volume growth continues

*Retail consumer lending (collateralised + non-collateralised consumer lending)

9

Reduced cost base since 2002* – despite strong increase in business volumes

3,903 3,8353,675

3,8223,655

146 146

161

188

214

0

500

1000

1500

2000

2500

3000

3500

4000

2002 2003 2004 2005 2006100.0

125.0

150.0

175.0

200.0

225.0

Operating expenses Total lending (right hand scale)

EURm EURbn

*Baseline adjusted for IFRS and net of acquisitions and divestments over the years. PostGirot included in 2002 figures

Cost unchanged despite lending growth of 50% and accumulated inflation of 13% in the period

European average is annual cost increase of 8%

10

Cost/income ratio continues downwards

Continued down to 52% in 2006Income up 12%Costs up 4%Excl. gain from sale of IMB shares C/I 53%

Strong growth in revenues combined with continuous focus on firm cost management Profitable organic growth in focus

6460

5652

63

0

10

20

30

40

50

60

70

2002 2003 2004 2005 2006

%

11

Gap between income and cost development

Percentage points Reported gap of 8.0 percentage

points, excl. full impact from sale of IMB 5.4 percentage points

Revenues up 12.2%Expenses up 4.2%

Three years track record of managing attractive gap between revenue and cost growth

6.6

8.0

5.4

6.9

0

1

2

3

4

5

6

7

8

9

10

2004 2005 2006

Gap excl. full impact from sale of IMB shares

12

Operating profit

EURm

2,745

3,820

3,048

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

2004 2005 2006

YoY

Up 25%Up 19% excl. gain from sale of IMB sharesIncreased focus on profitable organic growth and cross-sellingOperating profit in Business Areas up 17% excl. gain from sale of IMB sharesStrong performance in all Business Areas

Retail up 18%CIB up 18%AM up 24%

13

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

1.1

1.2

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 Q4/06

Reported Excl. gain from sale of IMB

EUR

Continuous increase in earnings per share- rolling 12 months

14

Dividend up 40%

766

908

1,271

0.28

0.35

0.49

0

200

400

600

800

1000

1200

1400

2004 2005 2006

0.0

0.1

0.2

0.3

0.4

0.5

0.6

0.7

0.8

0.9

1.0

Total amount EURm Dividend per share EUR

EURm EUR

15

Key growth areas – organic growth strategy continues to pay off

Continue to leverage on strong position within long-term savings, eg Nordic Private Banking and Life insurance

Increase in AuM - total net inflow 2006 EUR 4.1bnRecruitment of personal bank advisors, private bank advisors and financial specialists

Strengthening market position within consumer credits incl. cardsConsumer lending up 17% (non collateralised), number of credit cards up 25%

Harness Nordea’s leading position in capital markets – leveraging Nordea’scustomer base. Sale of Nordea Markets products to Business Areas up 38%Further position Nordea successfully in the Baltics, Poland and Russia

Lending up 40% in the Baltics and Poland

Attract new and move existing customers into the most profitable segments

16

Gold and Private Banking customers are the engine for profitable growth

11%16%

64%

9%

Private Banking Gold Silver Bronze

8%3%

8%

45%

Private Banking Gold Silver Bronze

Approx. EUR 3.0bn of Retail Banking’s income is generated from household customers

Gold customers generate two/thirds of the income

Total revenues from household customers increased by 9% during 2006

Private Banking shows very strong growth in income

Share of Retail Household income in 2006

Income growth during 2006

17

Strong success to date

14066

161

72

No. of customers(m)

Volume percustomer(EUR'000)

Business volumes(EUR bn)

2.1 2.2

5.7%8.6%

14.8%

Strong growth in business with Gold customers generated by

Increase in number of customers

Increase in volume per customer

Growth in number of customers is a combined effect of

Existing customers moving upward in the segments

New Nordea customers

Volumes measured as the sum of total lending and savings

Strong growth in Gold segment Dec 2005 to Dec 2006

18

Strong revenue growth in all Retail corporate segments

55%

27%18%

Small Medium Large

Approx. EUR 2.0bn of Retail Banking income is derived from corporate customers

The customers in segment Large account for half of the revenue

In total revenues from corporate customers increased by 6% 2006

Small

7%

6%

4%

Small Medium Large

Share of Retail Corporate income in 2006

Income growth during 2006

19

Continue to leverage on strong position within long-term savings – Private BankingEURbn

Strong asset growth in Nordic Private Banking

Net inflow in Q4 13% annualisedResult of roll-out of new common advisory concepts, particularly in Norway and Sweden

AuM up 20% YoY29 31 33 34 36 37 39 42

8 8 8 9 9 9 99

05

101520253035404550

Q1/05

Q2/05

Q3/05

Q4/05

Q1/06

Q2/06

Q3/06

Q4/06

European private bankingNordic private banking

20

Continue to leverage on strong position within long term savings – stepwise increase of premiums in Life

EURm Net written premiums up 22%Unit linked share of premiums 42%Increased penetration in the customer base – successful cooperation between Life and RetailNordea’s share of signed agreements in Mandatory Company Pension (MCP) Norway approx 16%Market share of new written premiums on private market 8.4% in Sweden end December

590

458404

607 582 560

454

601

198

187174

474

390 404

267

511

0100200300400500600700800900

1,0001,1001,200

Q1/05

Q2/05

Q3/05

Q4/05

Q1/06

Q2/06

Q3/06

Q4/06

Traditional insurance Unit linked

21

Accelerated market position within consumer lending and cards

EURbn

YoY

Consumer lending up 12%Non collateralised up 17%

Approx. 500,000 new cards issued In total 5.6 million cards issued

Of which approx. 11% credit cardsNumber of credit cards up 25%

Q4oQ3

Consumer lending up approx. 2% Growth strategy and penetration of customer base is paying offMargins basically unchanged adjusting for business mixCard commissions up 5%

13.2 13.5 13.8 13.9 14.214.9

15.4 15.6

0

2

4

6

8

10

12

14

16

Q1/05

Q2/05

Q3/05

Q4/05

Q1/06

Q2/06

Q3/06

Q4/06

Retail consumer lending

22

Increased cross-selling of Markets related products to SMEs

Successful penetrationLeveraging Nordea’s customer base

SME segment still under penetrated

Focus on customer solutions rather than product push

Strong concepts in risk management and asset-liability managementIncreased capabilities in derivatives

Revenue increase driven byStructured productsStill strong and stable core business in F/X and fixed income trading

202

270

373

0

50

100

150

200

250

300

350

400

2004 2005 2006

Markets total revenue from Retail customers

EURm

23

Increased investments to capture growth opportunities in fast growing markets

Accelerated growth plan in Nordic markets, in particular SwedenIn line with Nordeas’ profitable organic growth strategy

Recruitment of personal bank advisors

Investments in Private BankingPrivate bank advisors and financial specialists

Increased growth ambitions in Poland with up to 150 new branches in 2-3 years. Aim to outperform market growth

Increased penetration in all customer segments but with emphasis on private customers and SMEs

22 new branch offices were opened in 2006 - 9 in Q4

24

OutlookBased on solid macroeconomic forecasts for the Nordic area, double digit growth in business volumes is expected

Despite the current pressure on lending margins Nordea expects the strong revenue growth to continue in 2007

Focus on risk-adjusted pricing combined with expected higher market rates will positively affect the revenue generation in 2007

The quality of the credit portfolio remains strong, however lower expected recoveries means that new provisions are expected to exceed reversals in 2007

The cost increase in 2007 is expected to be of the same magnitude as in 2006

The gap between revenue and cost growth is for the full year 2007 expected to be 3-4 percentage points *

*Excl. the acquisition of Russian Orgresbank

25

SummaryRecord result following reinforced organic growth strategy

Net profit up 39%

Gap between revenue and cost growth 5.4 percentage points when excluding the full impact of IMB saleReported Return on equity 22.9%

Excl. gain from sale of IMB 21.5%

Record dividend – EUR 0.49 per shareNordeas’ growth strategy is paying off

Increasing number of core customersStrong performance in long term savings – especially private bankingIncreased penetration among SME clients with Markets related productsLending volumes up from high levelGrowth strategies in Sweden and Poland & Baltics developing well

CFO Presentation

27

Income statement summary

253,0483,820Operating profit

392,2693,153Net profit

196780Equity method122143318Other income

137257Loan losses4

-3428

12

3576

Chg %

-3,668-131

-1,455-2,0826,573

7651,9353,6632005

-86Depreciation-1,485Other expenses

-3,822Total operating expenses

-2,251Staff costs7,377Total operating income

1,036Net gains/losses on items at fair value2,074Net fee and commission income3,869Net interest income2006EURm

28

Income statement summary

0

-9

9-171010-2

-88-53

3810

3Chg %

7481,063967Operating profit

506872876Net profit

21178Equity method2921726Other income

75582Loan losses-956

-31-393-532

1,696

184529933

Q4/05

-928-23

-355-550

1,934

224497979

Q3/06

-19Depreciation-391Other expenses

-1,016Total operating expenses

-606Staff costs1,899Total operating income

310Net gains/losses on items at fair value549Net fee and commission income

1,006Net interest incomeQ4/06EURm

29

Net interest income

EURm

YoY

Up 6%Volume growth compensated for pressure on lending marginsTotal lending up 14%

Mortgage lending up 15%SME lending up 14%

Increased contribution from depositsMargins recovering following higher market rates

Q4oQ3

Up 3%Total lending up 6%Household deposit margins improved

913 933 927 957 979 1,006

920

0

100

200

300

400

500

600

700

800

900

1,000

Q2/05

Q3/05

Q4/05

Q1/06

Q2/06

Q3/06

Q4/06

30

48Treasury

834Other, net

27206Total

-7-164Margin driven

62

-226

64

264

328

YoY

10-Deposit margins

-17

3

19

22

Q4oQ3

-Lending margins

-Deposit volumes

-Lending volumes

Volume driven

Change in net interest income

EURm

31

Net commission income

EURm

YoY

Up 7%Savings commissions up 9%

Asset management commissions up 9%

Cards up 12%Q4oQ3

Up 10% - recovered in Q4 after market turmoil effects in Q3Strong growth in savings related commissions – up 19%

Mainly from Asset ManagementStrong Life commissions growth following significant premium growth and strong investment result

Payment commissions up 5%

484

529507 521

497

549

469

0

100

200

300

400

500

600

Q2/05

Q3/05

Q4/05

Q1/06

Q2/06

Q3/06

Q4/06

32

Breakdown of commission income - gross

281306

319338 335 325

301

359

162175 177 177 171 183 187 197

82 90 87 98 88 86 87 91

51 48 3259

41 45 3649

0

40

80

120

160

200

240

280

320

360

400

Q1/05 Q2/05 Q3/05 Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

Savings related Payments related Lending related Other

EURm

Of which Asset Mgmt Of which Cards

33

Customer business drives increase in net/gains losses

EURm

230220

205

-46

28 3 19 33

251

277

-50-30-101030507090

110130150170190210230250270290

Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

Business Areas Treasury and eliminations

YoY

Up 35%Up 23% in Business Areas

Strong customer demand for structured products Client driven FX and fixed income transactions

Strong contribution from Group Treasury

Q4oQ3

Up 35% in Business AreasStrong improvement in Group Treasury

34

44

277

80

6

93

98

Q4/06

8

205

51

7

72

75

Q3/06

7

220

61

4

68

87

Q2/06

108Asset Mgmt

8387CIB

-3140Group Treasury

230265BAs

69

101

Q1/06

70

67

Q4/05

Life

Retail

Net/gains losses, EURm

Increased revenues from net/gains losses in Business areas

35

Total operating income

EURm

YoY

Up 12%Increased focus on top line growthSteady increase in net interest income

Volume growth more than compensating for lending margin pressure. Improved deposit margins

Commission driven by savings related commissionsNet/gains losses – strong increase in customer driven financial transactions

Q4oQ3

Strong increase when adjusting for IMBAccelerating business momentum in all Business Areas

1,601

1,759 1,785

1,934 1,899

1,7341,696

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

Q3/05 Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

Excl. gain from sale of IMB shares

36

Expenses

EURm

YoY

Costs up 4%Increases following

Investments in growth areasNumber of FTEs increases by approx 300 – mainly P&B, Life and Growth plan SwedenGeneral wage increase approx 3.5%Variable salaries and profit sharing

Approx 3% when excluding variable salaries and profit sharing

Q4oQ3

Up 9% following strong performance and high business activity

520 543 552 550606

345393 367 372 355

39131

31 23 21 2319

532

0

100200

300400

500600

700

800900

1,000

Q3/05 Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

Staff costs Other expensesDepreciation

933896

1,016928956 945

37

Well controlled expense growth 2006

4.2%

2.9%

1.3%

0%

1%

2%

3%

4%

5%

Reported Excl. Variablesalaries and profit

sharing

Excl. Variablesalaries, profit

sharing andinvestments ingrowth areas

Cost increase driven by decision to invest in profitable growth areasCost management well established

38

Strong result and investments explains cost increase

3,668

Expenses 2006

OtherIncrease in variable salaries and profit sharing

+46

+48

Expenses 2005

EURm

3,822

Investments in areas like Growth Plan Sweden, Cards, Life, Private Banking

Investments in growth areas*

+60

+154

39

Staff costs

2,082

Staff costs 2006

Wage increases

Higher variable salaries and profit sharing

Increase in FTEs, net

+73

+19+29

Staff costs 2005

EURm2,251

No. of recruitedFTEs: approx.

2,400

No. of FTEs thathas left: approx.

2,100

Training and other staff related expenses

+48 +169

40

Number of FTEs

Increased number of sales related employees and falling number of employees in processing and staff unitsReduction of approx. 150 in Q4 following efficiency gains and outsourcing

28,930 29,052 29,201 29,396 29,249

0

4,000

8,000

12,000

16,000

20,000

24,000

28,000

32,000

Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

+2561.5021.758of which P&B

-2686,2385,972Group Functions

+58522,69223,277BAs

+31928,93029,249Total

-24

-242

+93

+274

+218

Chg YoY

1,192

5,046

2,001

3,331

17,360

Q4/05

1,168

4,804

2,094

3,605

17,578

Q4/06

Group Staffs

CIB

GPT

AM & Life

Retail

FTEs

41

Loan losses

EURmYoY

Positive net loan losses reflecting low new provisions coupled with recoveries maintained at a high levelCredit quality remains strong in all markets

Q4oQ3

Continued flow of recoveries and low new provisions

Large movements in gross provisions Changes in group-wise provisions

-23-31

-89

-55

-82

-6 -7

-101

-120

-100

-80

-60

-40

-20

0

20

Q1/05

Q2/05

Q3/05

Q4/05

Q1/06

Q2/06

Q3/06

Q4/06

42

0.18

74

374

-1,118

1,492

Q4/06

0.21

74

416

-1,188

1,604

Q3/06

0.20

76

405

-1,270

1,675

Q2/06

0.18

80

341

-1,371

1,712

Q1/06

0.18

81

340

-1,480

1,819

Q4/05

Reserves

Reserves/impaired loans, gross,%

Impaired loans, net/lending,%

Impaired loans, net

Impaired loans, gross

EURm. End of period

Impaired loans

Net impaired loans as per cent of total lending: 18bp

43

-416-354Allowances for collectively assessed loans59%60%Total allowances / Impaired loans, gross individually assessed

0.78%0.52%Impaired loans, net / lending (%)42%41%Allowances, individually assessed / Impaired loans, gross,

1,4621,104Impaired loans, net, individually assessed -1,064-764Allowances for individually assessed loans

1,868

31 Dec 2006

2,526

31 Dec 2005

Impaired loans, gross, individually assessed

EURm

New baseline impaired loansNordea has of end of December 2006 changed the definition of impaired but performing loans. The change increases the size of impaired loans but leaving the allowances unchanged

44

Operating profit

EURm

688 728 748

858932

1,063967

884 864

0100200300400500600700800900

1,0001,100

Q1/05

Q2/05

Q3/05

Q4/05

Q1/06

Q2/06

Q3/06

Q4/06


YoY

Up 25%Up 19% excl. gain from sale of IMB sharesOperating profit in BAs up 17% excl. gain from sale of IMB sharesIncreased focus on profitable organic growth and cross-sellingStrong performance in all Business areas

Retail up 18%CIB up 18%AM up 24%

Q4oQ3

Up 29%6% gap between revenue and cost growth in Q4

45

Net profit

EURmYoY

Up 39% Operating profit up 25%Strong gap between revenue and cost growth combined with low tax rateEffective tax rate 19% (excl tax-free gain from IMB) following the revaluation of the deferred tax asset in Finland

Q4oQ3

Up 30% excl. gain from sale of IMB shares

563

665740

872 876

506

673

0

100

200

300

400

500

600

700

800

900

Q3/05 Q4/05 Q1/06 Q2/06 Q3/06 Q4/06


46

Return on equity

%Strong RoE - 22.9%

21.5% excl. gain from sale of IMB

At top level among Nordic peers

16.9

22.9

18.0

21.5

0

5

10

15

20

25

2004 2005 2006


47

Strong growth also in risk-adjusted EPS

0.86

0.67

1.21

0.81

0

0.2

0.4

0.6

0.8

1

1.2

1.4

Reported EPS, EUR EPS, risk adjusted, EUR

2005 2006

48

Risk-weighted assets (RWA)

EURbnYoY

RWA up 9%Total lending up 14%

Q4oQ3

RWA unchanged

Nordeas’ model to calculate VaR has been approved by FSA:s

Decreased RWA with approx. EUR 7bn

153159 162

169 174180 185 185

0

20

40

60

80

100

120

140

160

180

200

Q1/05

Q2/05

Q3/05

Q4/05

Q1/06

Q2/06

Q3/06

Q4/06

49

Capital position

%Tier 1 ratio 7.1%Profitable volume growthTotal capital ratio at 9.8%

7.06.8 6.8 6.9 7.1

6.8

0

1

2

3

4

5

6

7

8

Q3/05 Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

50

Return on risk weighted assets, rolling 4 quarters

153 159 162169 174 180 185 185

1.261.42 1.45 1.41 1.47 1.44 1.46

1.62

0

20

40

60

80

100

120

140

160

180

200

Q1/05 Q2/05 Q3/05 Q4/05 Q1/06 Q2/06 Q3/06 Q4/060.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

2.0

2.2

RWA Return on RWA

EURbn %

*

* Excl. Gain from sale of IMB shares

** Reported RWA of EUR 185bn is after EUR 7bn reduction of RWA following new models for calculating market risks

7

192**

51

18.2

14.8

9.6

0.02.04.06.08.0

10.012.014.016.018.020.0

Capital base Regulatory Capital Economic Capital

(EU

Rbn

- En

d of

yea

r 200

6)

Continuous strive for capital efficiency

How much capital must Nordea have?

How much capital should Nordea have?

How much capital does Nordea have?

Tier 1+Tier2 (8% of RWA)

Tier 1

13.1

Tier 2

5.1

52

Tier 1 capital

18.2

13.114.5

10.5

13.3

9.6

0.0

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

EUR

bn

Nordea expects to have excess capital after full implementation of Basel II

185

148

0

20

40

60

80

100

120

140

160

180

200

2006 2006*

EUR

bn

Capital base(Tier 1+ Tier 2)

Expected reduction RWA Pillar 1; approx. 30%

Expected reduction RWA incl Pillar 2; approx. 20%

* Pro-forma Basel II

9.8% 9.8%

9.0%

7.1%7.1%

6.5%

20% reduction in RWA Implications for capital ratios

2006 2006* 2006* 2006 2006* 2006*

53

Nordea’s new financial targets

Long term financial targets Target

TSR (%) In the top quartile of European peer group

Risk adjusted profit (EUR m)

In line with top Nordic peersRoE (%)

Double in 7 years

Capital structure policy Policy

Dividend payout-ratio > 40% of net profit

Tier 1 capital ratio > 6.5%

54

2,107

819

373

3,822

-256

7,377

Baseline 2006

Risk adjusted profit

standard tax

expected losses

total operating expenses

non recurring items*

Total income

EURm

Risk adjusted profit

Increased by 18% in 2006

* Includes sales gain and contribution under equity method from IMB and sales gain from Asiakastieto

Business trends

56

Total lending

0

20

40

60

80

100

120

140

160

180

200

220


Corporate Housing loans Other loans Public sector

EURbn

148146

182

149147147 156 155

170161

175189

199191

201214

57

Household mortgages, volumes and margins

44.3 45.748.2 48.9 50.0

52.6 54.5 56.3 57.760.4 62.6 64.5 65.8

68.5 70.674.4

05

101520253035404550556065707580

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 Q4/060.20.30.40.50.60.70.80.91.01.11.21.31.41.51.6

EURbn %

58

Retail consumer lending, volumes and margins

12.1 12.2 12.4 12.4 12.2 12.5 12.7 12.9 13.2 13.5 13.8 13.9 14.214.9

15.4 15.6

0

2

4

6

8

10

12

14

16

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 Q4/060.0

0.6

1.2

1.8

2.4

3.0

3.6

4.2

4.8EURbn %

59

Lending to corporates (SME), volumes and margins

57.3 57.3 57.4 56.7 56.3 58.1 58.561.0

64.0 65.367.9 70.0 70.9 73.2 73.4

78.4

0

10

20

30

40

50

60

70

80


0.7

0.8

0.9

1.0

1.1

1.2

1.3

1.4

EURbn %

60

CIB lending, volumes and margins*

21.722.6

21.4

18.4 18.120.3

19.018.0

21.4 21.720.8 21.2

22.6 23.322.3

23.6

02468

1012141618202224262830

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 Q4/060.00.10.20.30.40.50.60.70.80.91.01.11.21.31.41.5

EURbn %

* Excl. Markets, Poland and Baltics

61

Total deposits

0102030405060708090

100110120130


Of which household deposits

EURbn

979892

969391

95

105 105 108106

116119

113119

127

62

Retail deposits, households, volumes and margins

40.2 40.7 41.7 41.3 40.442.3 42.9 43.8 44.1

45.7 46.9 47.0 47.149.6 50.1 50.7

0

5

10

15

20

25

30

35

40

45

50


0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

2.0

2.2

2.4

EURbn%

63

Structural Interest Income Risk (SIIR)

-220

206

Q4/06

-175

154

Q4/05

-165

174

Q3/06

Decreasing market rates, 100bp

Increasing market rates, 100bp

EURm, annualised effect on NII*

*Approx. end of period

SIIR is defined as the effect on net interest income (NII) in the next 12 months if market rates change by one percentage point. Figures are asymmetrical as interest rates on deposits from customers cannot be reduced below 0%. Figures are based on maturity and repricing structure, and the effect going forward will be subject to management decisions and the competitive situation in the market.

Increased SIIR following growth in assets and liabilities in Q4. Increased non-interest bearing liabilities

Reduced duration in ALM programme

64

Retail deposits, SME, volumes and margins

26.2 26.3 26.728.3 28.4 28.9 28.8

30.5 29.4 30.131.5

33.4 32.634.8 34.7

37.5

0

5

10

15

20

25

30

35

40


0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

EURbn %

65

CIB, deposits, volumes and margins*

14.415.4

13.315.2 14.9

17.9 18.0

21.0

23.2

20.418.5

22.121.2

22.3 21.8

25.0

0

2

4

6

8

10

12

14

16

18

20

22

24


0.05

0.10

0.15

0.20

0.25

0.30

0.35

0.40

0.45

0.50

0.55

0.60

EURbn %

* Excl. Markets, Poland and Baltics

66

0

20

40

60

80

100

120

140

160

Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

Nordic Retail funds European Fund DistributionNordic Private Banking International Wealth ManagementInstitutional clients Life & Pension

Assets under management

EURbnYoY

Up 9%

Strong growth in Nordic Private Banking up 23%

Asset growth from well diversified sales platforms

Q4oQ3

Favourable equity markets

Net outflow due to one single mandate lost – strong underlying trend

158148

153154161

67

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

4

5

Q4/05 Q1/06 Q2/06 Q3/06 Q4/06 Q4/06Adjusted

Nordic Retail funds European Fund DistributionNordic Private Banking International Wealth ManagementInstitutional clients Life & Pension

Net inflows

EURbn

Net inflow in 2006 EUR 4.1bn Strong increase in Nordic Private Banking, Institutional clients and Life

Net outflow from Retail funds in Q4 of EUR 6.5bn

In the fourth quarter a mandate of 6.4bn was withdrawn, following a new administrative set-up decided by the client.

Net inflow in Q4 within Nordic Private Banking and Institutional clients

Net inflow for European Fund distribution

Adjusted net inflow in Q4 EUR 2bn

1.80.9

3.4 3.3

-4.4 2.0

68

Retail profit before loan losses

EURmYoY profit up 13%

Key product areas showing double digit volume growth

Strong improvement in result from deposits

Strong revenue growth from gold customers

Plan to capture untapped potential in Sweden proceeding well

556600 583 585577

050

100150200250300350400450500550600650700

Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

24

55

Q4/05

26

53

FY 2006

26

55

Q4/06

RaRoCar, %

C/I ratio, %

Key ratios

69

CIB profit before loan losses

EURm

YoY profit up 21%, excl gain from sale of IMBHigh activity in all areasAccelerated growth plan for Poland outlined

144

160

145

159169

0

20

40

60

80

100

120

140

160

180

Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

19

51

Q4/05

22*

49*

FY 2006

29

50

Q4/06

RaRoCar, %

C/I ratio, %

Key ratios

*

*Excl. gain from sale of IMB shares

70

Asset Management product result

EURmYoY product result up 23%

Up 46% Q4oQ3

Double digit income growthStronger sales of newly launched products with better marginsHigher transaction and performance feesPositive trend within institutional asset management

96

8580

117

93

0

10

20

30

40

50

60

70

80

90

100

110

120

Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

151

48

Q4/05

161

46

Q4/06

AuM, EURbn

C/I ratio, %

Key ratios

71

Life insurance, product result

EURmNet written premiums up 22%

Up 54% in Q4

Unit link premiums up 52%Accounting for 42% of total premiums

Fee based business model continues to deliverStrong investment result in Q4Nordea Life and Pension became the largest insurance company in the Nordic market in 2006, measured by premiums

5652

61

74

56

0

10

20

30

40

50

60

70

80

90

Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

16.5

1.6

Q4/05

22.8

2.3

Q4/06

Financial buffers, %

Inv return, %

Key ratios

72

Group Treasury, operating profit

-23

15 12 7

3926

34

21 32

42

-25

-5

15

35

55

75

95

Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

Group Investment Group Funding

EURm

Strong improvements for both Group Investment and Group Funding Operating profit EUR 203m -more than a doubling compared to 2005

Supported by successful positions in the money and capital markets

Gross investment returns at 3.98%, well above return target

73

SummaryRecord result following reinforced organic growth strategy

Net profit up 39%

Gap between revenue and cost growth 5.4 percentage points when excluding the full impact of IMB sale

Reported Return on equity 22.9%RoE excl. gain from sale of IMB 21.5%

Record dividend – EUR 0.49 per share

Nordeas’ growth strategy is paying off Increasing number of core customersStrong performance in long term savings – especially private bankingIncreased penetration among SME clients with Markets related productsLending volumes up from high levelGrowth strategies in Sweden and Poland & Baltics developing well

Facts & figures

75

Facts & Figures, content

Credit quality Page 76

Economic capital Page 86

Business areas Page 89

Balance sheet Page 118

Market shares Page 121

Appendix Page 128

Credit quality

77

Loan portfolio by customer category*

85 84 8278 79

83 8084

9197 100 101

105 105113

44 46 48 49 50 53 55 56 58 60 63 65 66 68 71 74

14 15 15 16 16 17 17 17 18 19 19 20 20 21 21 22

93

0

10

20

30

40

50

60

70

80

90

100

110


Corporate lending Housing loans Other loans

EURbn

* Excluding public sector

78

Public sector2.1%

Household customers

44.9%Companies53.0%

Household customers

45.1%

Public sector1.9%

Companies53.0%

End Q4/05, EUR 188.5bnEnd Q4/06, EUR 214.0bn

Loan portfolio by customer group

79

Housing loans77.2%

Other loans22.8%

Lending to household customersEnd of Q4/06

EUR 96.4bnOther loans comprise

consumer credits

investment credits

car financing

overdraft facilities

credit cards

home equity credits

80

Other9%

Real estate27%

Construction3%

Agriculture & Fishing6%

Transp. & Communication

5%

Finance11%

Renting,Consulting and other services

11%

Manufacturing13%

Commerce and services

10%

Shipping & Offshore5%

Lending to companies by industry End of Q4/06

EUR 113.5bn

81

214.0

5.7

6.4

14.2

12.5

12.7

15.0

11.1

5.9

3.4

30.7

96.4

Q4/06

201.1

5.3

6.1

13.7

12.5

8.4

14.6

10.8

5.9

3.3

28.6

91.9

Q3/06

198.8

5.2

5.8

14.5

12.0

9.6

14.5

10.4

5.8

3.6

28.0

89.4

Q2/06

190.7

5.4

5.7

15.1

10.4

8.7

14.0

9.9

5.8

2.9

26.8

86.0

Q1/06

188.4

5.3

5.8

14.6

9.6

10.5

13.4

9.9

5.6

2.9

26.2

84.6

Q4/05

Total

Shipping & Offshore

Agriculture & Fishing

Other companies/public sector

Renting, Consulting and other services

Finance

Manufacturing

Trade and services

Transport, communication

Construction

Real estate

Household customers

EURbn

Loan portfolio in figures

82

EU countries other3.7%

USA0.7%

Asia1.0% Latin America

0.6%

Other non OECD0.3%

Other OECD0.6%

Slice 80.0%

Other6.9%

Nordic countries and P&B

93.1%

Lending by geographical area End of Q4/06

EUR 214.0bn

Nordic countries and P&B, EURbnSweden 59.2Denmark 58.1Finland 42.4Norway 34.7P&B 4.8

83

325Public sector

10717Shipping & Offshore

132538Construction

133750Transport, communication

115162Agriculture & Fishing

21126147Renting, Consulting and other services

29136165Other companies

44107151Trade and services

43348391Manufacturing

1,098

20

65

176

Provisions

1,492

25

94

348

Gross

394

5

29

172

Net

Total

Finance

Real estate

Household customers

EURm. End of Q4/06

Impaired loans

84

088Credit Institutions

213Public sector

19726Shipping & Offshore

272148Construction

362763Transport, communication

222143Agriculture & Fishing

76113189Renting, Consulting and other services

7849127Other companies

106107213Trade and services

192213405Manufacturing

757

20

57

121

Provisions

1,868

42

129

572

Gross

1,103

22

72

451

Net

Total

Finance

Real estate

Household customers

EURm. End of Q4/06

New baseline impaired loans

85

Loan losses

EURm

192156

9258

86

-215-163

-123 -147 -140

-23 -7 -31-89

-54

299

-381

-82

-420-370-320-270-220-170-120

-70-203080

130180230280330

Q3/05 Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

Gross Reversals Net

YoY

Positive net loan losses reflecting low new provisions coupled with recoveries at a high levelCredit quality remains strong in all markets

Q4oQ3

High recoveries in Q4, partly related to changes in group-wise provisions. Nordea Bank Denmark has restated EUR 60m in 2005 following Danish FSA decision - effect for Nordea Group in Q4 2006

Economic capital

87

Economic capital (EC)

EURbn

8.9 9.0 9.2 9.39.0

0

1

2

3

4

5

6

7

8

9

10

Q3/05 Q4/05 Q1/06 Q2/06 Q3/06

1,035Life

1,962CIB

168Asset Mgmt

418

126

Treasury

GPT

1Other

5,890Retail Banking

9,600

Q4/06

Total

EC per business area (EURm)

88

Economic capital – distributionEnd of Q4/06

Life risk1%

Market risk15%

Operational risk9%

Business risk12%

Credit risk63%

Other1%

CIB21%

Treasury4%

Asset Mgmt & Life12%

Retail61%

Retail Banking

90

Retail Banking lending and deposit volumes

26.0

14.7

25.8

21.7

Q4/06

23.9

14.3

25.0

21.6

Q3/06

23.9

14.2

25.0

21.4

Q2/06

11.211.912.512.913.4Norway

21.8

24.1

20.5

Q1/06

22.4

24.8

20.3

Q4/05

21.3

23.9

20.6

Q3/05

20.8

23.4

18.1

Q1/05

20.6

24.0

19.3

Q2/05

Denmark

Sweden

Finland

Deposits, EURbn

51.1

28.8

39.5

52.5

Q4/06

48.8

27.4

38.6

48.7

Q3/06

49.1

26.8

37.7

47.5

Q2/06

21.823.324.325.226.0Norway

46.5

36.4

45.5

Q1/06

46.1

35.6

45.1

Q4/05

45.2

34.8

43.2

Q3/05

43.3

33.8

41.3

Q2/05

44.0

33.0

38.5

Q1/05

Denmark

Sweden

Finland

Lending, EURbn

91

Retail Banking breakdown of lending

4.0

17.2

18.3

Q4/06

4.3

16.5

17.7

Q3/06

4.2

16.0

17.5

Q2/06

4.0

15.5

16.9

Q1/06

3.9

15.2

16.4

Q4/05

3.8

14.8

16.2

Q3/05

3.7

13.6

15.7

Q1/05

3.8

14.2

15.9

Q2/05

Corporate

Consumer lending

Households mortgages

Finland, EURbn

6.5

22.5

21.9

Q4/06

6.3

21.8

19.1

Q3/06

6.0

20.8

18.2

Q2/06

5.8

20.3

18.2

Q1/06

5.8

19.6

18.1

Q4/05

5.8

18.8

17.0

Q3/05

5.5

17.2

14.7

Q1/05

5.7

17.9

16.1

Q2/05

Corporate

Consumer lending

Household mortgages

Denmark, EURbn

92

Retail Banking breakdown of lending

4.1

20.5

24.9

Q4/06

3.7

19.5

24.0

Q3/06

3.6

19.2

24.8

Q2/06

3.4

18.3

23.5

Q1/06

3.4

18.0

23.5

Q4/05

3.3

17.4

23.2

Q3/05

3.3

16.6

22.9

Q1/05

3.3

16.6

22.2

Q2/05

Corporate

Consumer lending

Household mortgages

Sweden, EURbn

1.0

14.7

13.3

Q4/06

1.0

14.0

12.7

Q3/06

1.0

13.3

12.7

Q2/06

0.9

12.8

12.3

Q1/06

0.9

12.4

12.0

Q4/05

0.8

11.9

11.5

Q3/05

0.7

10.5

10.6

Q1/05

0.8

11.4

11.1

Q2/05

Corporate

Consumer lending

Household mortgages

Norway, EURbn

93

Retail Banking breakdown of deposits

7.9

9.9

7.9

Q4/06

7.7

9.9

7.4

Q3/06

7.5

10.1

7.4

Q2/06

7.2

9.9

7.0

Q1/06

7.1

10.4

7.2

Q4/05

6.6

10.4

7.0

Q3/05

6.5

9.9

6.9

Q1/05

6.6

10.3

7.2

Q2/05

Corporate

Households, savingsaccounts

Households, currentaccounts

Finland, EURbn

10.0

3.4

8.3

Q4/06

9.9

3.3

8.3

Q3/06

9.9

3.4

8.0

Q2/06

9.5

3.1

7.8

Q1/06

9.4

3.2

7.8

Q4/05

9.5

3.1

8.0

Q3/05

9.0

3.1

7.2

Q2/05

8.4

2.9

6.8

Q1/05

Corporate



Denmark, EURbn

94

Retail Banking breakdown of deposits

7.8

5.8

12.5

Q4/06

7.8

5.5

10.6

Q3/06

7.4

5.4

11.1

Q2/06

6.7

5.0

10.1

Q1/06

6.3

5.0

11.0

Q4/05

6.8

5.0

9.6

Q3/05

6.4

4.9

9.5

Q1/05

6.5

4.8

9.4

Q2/05

Corporate



Sweden, EURbn

3.9

2.0

8.8

Q4/06

3.8

2.1

8.3

Q3/06

3.7

2.2

8.3

Q2/06

3.7

2.0

7.7

Q1/06

3.7

1.8

7.4

Q4/05

3.9

1.7

6.9

Q3/05

3.8

1.7

6.3

Q2/05

3.6

1.4

6.2

Q1/05

Corporate



Norway, EURbn

95

Retail Banking margins

1.74

1. 06

3.46

0.57

0.92

Q4/06

1.69

1.03

3.53

0.63

0.95

Q3/06

1.66

1.02

3.61

0.70

0.98

Q2/06

0.920.850.810.760.75Mortgages, households

4.074.043.813.743.66Consumer loans, households

1.62

1.01

1.00

Q1/06

1.55

1.05

1.04

Q4/05

1.56

1.06

1.06

Q3/05

1.55

0.86

1.13

Q1/05

1.53

1.06

1.09

Q2/05

Lending to SME’s

Deposits, households

Deposits, SME’s

%

Payments & transactions

97

E-banking customers, all customers

E-banking customers

0.0

0.51.0

1.5

2.02.5

3.0

3.5

4.04.5

5.0

Fe

b-00

Ju

ne-

O

ct-0

0

Feb-

01

June

- O

ct-0

1 F

eb-0

2 J

une-

02 O

ct-0

2Fe

b-03

Jun-

03O

ct-0

3Fe

b-04

Jun-

04O

ct-0

4Fe

b-05

Jun-

05O

ct-0

6Fe

b-06

Jun-

06O

ct-0

6

Mill.E-banking payments

05

10152025303540455055

Q1/

00

Q3/

00

Q1/

01

Q3/

01

Q1/

02

Q3/

02

Q1/

03

Q3/

03

Q1/

04

Q3/

04

Q1/

05

Q3/

05

Q1/

06

Q3/

06

Denmark Finland Norway Sweden

Mill.

98

Cards, all customers

Issued debit and credit cards

0.0

1.0

2.0

3.0

4.0

5.0

Ja

n-01

M

ay-0

1

Sep

t-01

Jan

-02

May

-02

Sep

t-02

Jan-

03M

ay-0

3S

ep-0

3Ja

n-04

May

-04

Sep

-04

Jan-

05M

ay-0

5S

ep-0

5Ja

n-06

May

-06

Sep

-06

Debit cards Credit cards

Mill.Card payments

0

20

40

60

80

100

120

140

160

180

Q1/

01

Q3/

01

Q1/

02

Q3/

02

Q1/

03

Q3/

03

Q1/

04

Q3/

04

Q1/

05

Q3/

05

Q1/

06

Q3/

06

Mill.

99

Payment transactions, households

0

20

40

60

80

100

120

140

160

180

200

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 Q4 06Manual transactions Payment ATMs Card paymentsCash withdrawal ATMs Direct debit Netbank payments

100

Payment transactions, households

1,286

168.3

109.3

164.8

700.4

16.3

108.9

2006

78.297.6117.3139.3155.7E-banking payments

8989611,0261,1091,187Total

78.5

207.2

333.5

34.3

166.2

2001

81.5

204.4

395.5

31.7

150.6

2002

86.1

197.4

459.9

27.1

137.7

2003

527.8603.6Card payments

23.619.7Payterminals

129.1124.6Manual transactions

190.4181.7Cash withdrawal ATM

101.2

2005

98.5

2004

Direct debit

Mill.

Corporate and Institutional Banking

102

CIB lending and deposit volumes and margins

0,86

36,4

4,6

9,4

1,5

12,7

Q4/06

0.83

31.1

3.8

9.1

1.3

12.0

Q3/06

0.87

32.3

3.7

9.1

1.5

12.7

Q2/06

0.93

32.2

3.4

8.6

2.0

12.0

Q1/06

0.96

32.4

3.3

8.5

1.7

11.1

Q4/05

0.86

32.5

2.5

7.7

2.0

12.0

Q2/05

0.91

32.2

2.8

8.1

1.8

10.9

Q3/05

30.9Total*

2.3Poland and Baltic

12.8Corporate Banking Division

0.94

6.5

2.0

Q1/05

International and Shipping Division

Financial Institutions Division

Lending, EURbn

Margins**, %

* Incl. Markets volumes** Excl. Markets and Poland & Baltics

0,34

29,3

2,3

4,3

13,0

7,8

Q4/06

0.38

25.1

2.0

3.8

11.3

6.7

Q3/06

0.37

26.4

1.9

4.5

10.3

7.5

Q2/06

0.37

25.7

1.8

4.3

10.4

6.6

Q1/06

0.40

26.8

1.8

4.3

10.9

7.0

Q4/05

0.40

24.7

1.4

3.6

8.8

8.0

Q2/05

0.39

23.3

1.5

3.6

8.6

6.3

Q3/05

26.7Total*

1.3Poland and Baltic

8.9Corporate Banking Division

0.37

3.2

11.1

Q1/05

International and Shipping Division

Financial Institutions Division

Deposits, EURbn

Margins**,%

103

Nordea operations in Poland and the Baltic countries

12**5153Operating profit (Q4), EURm

1.1 %2.8 %3.4 %5.8 %Market share, deposits, %

18

1.7 %

1,230

1,764

2,117

887

45

363,650

Poland

753Country position, overall

1,775195364316Number of FTEs

90111717Branches/salespoints

1,232,500*41,60043,95054,300Customers

5,9949431,4841,450Total assets, EURm

7.8 %

375

1,418

Latvia

9.4 %

452

1,281

Estonia

6.2 %

255

812

Lithuania

Market share, lending, %

2,311Deposits & Funds, EURm

5,276Commitments***, EURm

TotalEnd of Q4/06

* Incl. Polish Life customers*’ Difference compared to summary of country result is explained by Nordic expenses *** Includes guarantees

Asset Management & Life Insurance

105

* All funds targeted at Nordic Retail segment.** Includes EUR 4.9bn in pension pools products

Breakdown of AuM by market and channels

Denmark

Finland

Norway

Sweden

Europe

North America

Retail funds* (sold through

own distribution)

Fund sales through

third-partiesPrivate Banking

Institutional customers

Total by market

Q2/06EURbn

161.137.6

12.0

7.1

1.8

19.3

-

-

-

-

-

-

5.7

-

17.9

15.9

2.2

9.2

-

11.5

4.6

3.8

3.0

2.7

0.6

18.6**

8.9**

5.0**

-

6.4 3.9**

1.2

59.9

36.5

12.8

32.6

18.8

0.6

26.251.65.740.1

Life & Pensions

106

Asset Management – margins*

BpsQ4oQ3

Income margin up 13bp, Mainly due to high performance fee, based on very good value adding performance

Operating expenses margin in line with last quarter Result margin record highUnchanged asset mix

6371 70 66 64

77

-20 -22 -22 -21 -21 -23

3037 35 32 30

43

-30-20-10

01020304050607080

Q3/05

Q4/05

Q1/06

Q2/06

Q3/06

Q4/06

Income margin Operating expenses marginResult margin

*Margins calculated using average AuM for Asset Management Activities excl. Nordic Private Banking activities. In Q3 these assets were EUR 106.8bn.Volumes used for calculating margins have been restated compared to previously reported figures. Non-income generating mandates of EUR 9bn havebeen deducted.

107

Nordic fixed

income45%

Int'l. equities

28%

Nordic equities

14%

Int'l. fixed income

13%Nordic fixed

income44%

Int'l. equities

28%

Nordic equities

15%

Int'l. fixed income

13%

Asset structure*

Q4/06

*Average AuM for Asset Management activities excl. Nordic Private Banking activities, in Q3 this was EUR 106.8bn

Q4/05

108

European fund distribution

-1,000

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

Q3/00 Q1/01 Q3/01 Q1/02 Q3/02 Q1/03 Q3/03 Q1/04 Q3/04 Q1/05 Q3/05 Q1/06 Q3/06

Inflow AuM

EURbn

109

Life - breaking out profit driversFee based on size of life provisions in “with profit” companies – DK, FIProfit-sharing from the Norwegian business (existing model, change pending)

25% of surplus/deficit from cost result in DK, 100% from FI and SE Profit-/loss-sharing in Norway

25% of surplus/deficit from risk result in DK, 100% from FI and SEProfit-/loss-sharing in Norway

Investment return from separated shareholders’ equity (DK, SE)

Health and accident result, holding company result etc.

Net unit-linked result including unit-linked cost/risk result

Commissions paid to Retail Banking less distribution cost in Retail Banking

Fee contribution

Contribution from cost result

Contribution from risk result

Inv. return on shareholders’ equity

Other profits

Unit-linked

Retail commission and distribution cost

110

Life - profit drivers

511602

1.112

3789-510834

138

-461

Q4/06

267454720

3761-414515660

34

Q3/06

404560964

3552-41343516

-435

Q2/06

390582972

3056-41347507

-136

Q1/06

474607

1,081

2956-3104961

10-133

Q4/05

Of which income within Retail

Key figures

Premiums written, net of reinsuranceHere of from Traditional businessHere of from Unit-linked business

Total Profit Unit linked

Traditional insurance

Other profits

Estimated distribution cost in Retail

Inv. return on Shareholders Equity

Total Profit Traditional

Total product result

Contribution from risk resultContribution from cost resultFee contribution/profit sharing

EURm

111

Life – net written premiums by market

1.112

150

191

238

205

328

Q4/06

720

97

95

151

134

244

Q3/06

964

124

153

221

205

262

Q2/06

254151Sweden

111107Other

1,081972Total

147236Norway

296237Denmark

273241Finland

Q4/05Q1/06EURm

112

Life, investments

EURbn Equitiespredominantly listed equities1/3 Nordic, 2/3 international

Bonds¾ Nordic issuersprimarily govmn’t & mortgage inst.

0

5

10

15

20

25

30

35

Q4/05 Q1/06 Q2/06 Q3/06 Q4/06

Equities Real Estate Alternative investments Bonds Unit linked

29,9 30,5 30,3 31,132,5

113

Life - asset allocation

212231.132.5Total

7

19

22

29

Q4/06

Equities, %

6

17

21

27

Q3/06

3.4

4.4

8.3

14.0

Q3/06Q4/06

3.7Sweden

4.7Norway

8.6Finland

14.4Denmark

Total, EURbn

114

Life - solvency situation End of Q4/06

2157914869Sweden**

308490725235Finland

123120634515Denmark

217181335154Norway*

Solvency in % of requirement

Solvencybuffer

Actualsolvency

RequiredsolvencyEURm

* Excluding unit linked company

** Nordea Life Sweden I

115

Life – solvency sensitivityEnd of Q4/06

215217308123Solvency in % of requirement

189217231124Equities drop 12%

214217333121Interest rates down 50bp

217

Norway

179

Sweden

124

Denmark Finland

291Interest rates up 50bp

116

Life – financial buffers

10.4

12.4

6.4

6.8

13.1

Q4/06

2,277

210

232

361

1,474

Q4/06

8.3139Sweden

% of total provisionsEURm

8.71,901Total

5.3286Finland

11.71,318Denmark

4.6157Norway

Q3/06Q3/06

117

Life – buffers in different scenariosEnd of Q4/06

EURm

2102323611,474Financial buffers, actual

1921401841,157Equities drop 12%

1512354191,394Interest rates down 50bp

230

Norway

259

Sweden

1,520

Denmark Finland

323Interest rates up 50bp

Balance sheet

119

Balance sheet

325,549

12,960

21,386

7,822

28,602

82,609

26,830

115,550

29,790

325,549

69,355

28,876

188,460

31,578

7,095

31 Dec 2005

15,322Total equity

346,890Total assets

32,288Deposits by credit institutions

126,452Deposits and borrowings from the public

31,041Liabilities to policyholders

83,417Debt securities in issue

346,890

25,254

8,177

24,939

75,228

24,207

213,985

26,792

6,678

29 Dec 2006

Other liabilities

Other assets

Derivatives

Subordintated liabilities

Loans and receivables to credit institutions

Derivatives

Loans and receivables to the public

Total liabilites and equity

Treasury bills and other eligible bills

EURm

120

Capital base

185,3989,069

176,3299.8%

18,159-179

-1,535684

6,726

7.1%13,147-1,4431,770-369

1,458

15,271

Q4/06

185,05216,192

168,8609.5%

17,613-173

-1,535812

6,617

6.9%12,704-1,001-1,765

-2751,457

14,288

Q3/06

180,38215,252

165,1309.3%

16,784-290

-1,535812

6,410

6.8%12,199

-634-1,800

-3041,458

13,479

Q2/06

173,61816,312

157,3069.4%

16,284-276

-1,537827

6,376

6.8%11,721-1,210-1,795

-3081,462

13,572

Q1/06

15,545RWA market risk

-279Deductions for other investments15,486Total capital base

9.2%Total capital ratio

837-of which perpetual subordinated loans

169,028

153,483

-1,535

5,862

6.8%11,438

-831-1,794

-3271,472

12,918

Q4/05

RWA credit risk

Tier 1 capitalTier 1 capital ratio

Tier 2 capital

Deductions for investments in ins. companies

Hybrid capital loans

GoodwillOther items net

Deferred tax assets

Total RWA

Core equity

EURm

Market shares

122

Market position in Nordic markets

9.6%11.2%30.8%14.6%- consumer lending

4.6%10.1%27.7%15.2%Life & Pensions (end June)

13.9%16.3%35.8%19.7%- lending21.1%17.2%37.9%21.8%- deposits

17.8%8.3%32.9%21.5%- deposits

15.5%12.6%31.2%15.3%- mortgage lending

1.8%

14.0%

Sweden

2.8%

8.3%

Norway

3.8%

26.3%

Finland

7.7%

19.0%

Denmark

Corporate customers

Brokerage (Jan 2007)

Investment funds

Personal customersMarket shares

Statistics mainly from November -December 2006

* Based on estimates

** Please note that KLP is excluded from the calculations

* **

123

Personal customer deposits - market volume & share

0

10

20

30

40

50

60

Dec-04

Feb-05

Apr-05

Jun-0

5Aug

-05Oct-

05Dec-0

5Feb

-06Apr-

06Ju

n-06

Aug-06

Oct-06

Dec-06

30%

32%

34%

36%

38%

40%

0100200300400500600

Nov-05

Jan-0

5Mar-

05May

-05Ju

l-05

Sep-05

Nov-05

Jan-0

5Mar-

05May

-05Ju

l-05

Sep-05

Nov-05

Jan-0

6Mar-

06May

-06Ju

l-06

Sep-06

Nov-06

18%

20%

22%

24%

26%

28%

0100200300400500600700

Dec-03

Feb-04

Apr-04

Jun-0

4Aug

-04Oct-

04Dec-0

4Feb

-05Apr-

05Ju

n-05

Aug-05

Oct-05

Dec-05

Feb-06

Apr-06

Jun-0

6Aug

-06Oct-

06Dec-0

6

15%

17%

19%

21%

23%

25%

EURbn FinlandDKKbn

Denmark

SEKbn SwedenNOKbn Norway

Market volume Market share

0

100

200

300

400

500

600

Nov-03

Jan-0

4Mar-

04May

-04Ju

l-04

Sep-04

Nov-04

Jan-0

5Mar-

05May

-05Ju

l-05

Sep-05

Nov-05

Jan-0

6Mar-

06May

-06Ju

l-06

Sep-06

Nov-06

5%

7%

9%

11%

13%

15%

124

Corporate deposits - market volume & share

0

5

10

15

20

25

30

Dec-04

Feb-05

Apr-05

Jun-0

5Aug

-05Oct-

05Dec-0

5Feb

-06Apr-

06Ju

n-06

Aug-06

Oct-06

Dec-06

35%

37%

39%

41%

43%

45%

0

100

200

300

400

Nov-03

Jan-0

4Mar-

04May

-04Ju

l-04

Sep-04

Nov-04

Jan-0

5Mar-

05May

-05Ju

l-05

Sep-05

Nov-05

Jan-0

6Mar-

06May

-06Ju

l-06

Sep-06

Nov-06

14%16%18%20%22%24%26%28%30%32%

0

100

200

300

400

500

Nov-03

Jan-0

4Mar-

04May

-04Ju

l-04

Sep-04

Nov-04

Jan-0

5Mar-

05May

-05Ju

l-05

Sep-05

Nov-05

Jan-0

6Mar-

06May

-06Ju

l-06

Sep-06

Nov-06

10%

12%

14%

16%

18%

20%

EURbn FinlandDKKbn Denmark



0.000

100.000

200.000

300.000

400.000

500.000

600.000Dec-0

3Feb

-04Apr-

04Ju

n-04

Aug-04

Oct-04

Dec-04

Feb-05

Apr-05

Jun-0

5Aug

-05Oct-

05Dec-0

5Feb

-06Apr-

06Ju

n-06

Aug-06

Oct-06

Dec-06

10%

15%

20%

25%

30%

125

Personal customer lending - market volume & share

0

1020

3040

5060

70

Dec-04

Feb-05

Apr-05

Jun-0

5Aug

-05Oct-

05Dec-0

5Feb

-06Apr-

06Ju

n-06

Aug-06

Oct-06

Dec-06

29%

30%

31%

32%

33%

34%

35%

0

100

200

300

400

500Dec-0

3Feb

-04Apr-

04Ju

n-04

Aug-04

Oct-04

Dec-04

Feb-05

Apr-05

Jun-0

5Aug

-05Oct-

05Dec-0

5Feb

-06Apr-

06Ju

n-06

Aug-06

Oct-06

Dec-06

8%

9%

10%

11%

12%

0

200

400

600

800

1000

1200

Nov-03

Jan-0

4Mar-

04May

-04Ju

l-04

Sep-04

Nov-04

Jan-0

5Mar-

05May

-05Ju

l-05

Sep-05

Nov-05

Jan-0

6Mar-

06May

-06Ju

l-06

Sep-06

Nov-06

8%

9%

10%

11%

12%




0

100

200

300

400

500

Nov-03

Jan-0

4Mar-

04May

-04Ju

l-04

Sep-04

Nov-04

Jan-0

5Mar-

05May

-05Ju

l-05

Sep-05

Nov-05

Jan-0

6Mar-

06May

-06Ju

l-06

Sep-06

Nov-06

12%

14%

16%

18%

20%

22%

126

Mortgage lending households - market volume & share

0200400600800

10001200

Dec-03

Feb-04

Apr-04

Jun-0

4Aug

-04Oct-

04Dec-0

4Feb

-05Apr-

05Ju

n-05

Aug-05

Oct-05

Dec-05

Feb-06

Apr-06

Jun-0

6Aug

-06Oct-

06Dec-0

6

10%

12%

14%

16%

18%

20%

0

200

400

600

800

1000

Nov-03

Jan-0

4Mar-

04May

-04Ju

l-04

Sep-04

Nov-04

Jan-0

5Mar-

05May

-05Ju

l-05

Sep-05

Nov-05

Jan-0

6Mar-

06May

-06Ju

l-06

Sep-06

Nov-06

8%

9%

10%

11%

12%

13%


SEKbn SwedenNOKbn

Norway


0

200

400

600

800

1000

1200

Dec-03

Mar-04

Jun-0

4Oct-

04Dec-0

4Mar-

05Ju

n-05

Sep-05

Dec-05

Mar-06

Jun-0

6Sep

-06Dec-0

6

0%

4%

8%

12%

16%

20%

0

10

20

30

40

50

60

Dec-04

Feb-05

Apr-05

Jun-0

5Aug

-05Oct-

05Dec-0

5Feb

-06Apr-

06Ju

n-06

Aug-06

Oct-06

Dec-06

30%

31%

32%

33%

34%

35%

127

Corporate lending - market volume & share

0

10

20

30

40

50

Dec-04

Feb-05

Apr-05

Jun-0

5Aug

-05Oct-

05Dec-0

5Feb

-06Apr-

06Ju

n-06

Aug-06

Oct-06

Dec-06

32%

34%

36%

38%

40%

42%

0250500750

1,0001,2501,5001,7502,0002,250

Dec-03

Feb-04

Apr-04

Jun-0

4Aug

-04Oct-

04Dec-0

4Feb

-05Apr-

05Ju

n-05

Aug-05

Oct-06

Dec-05

Feb-06

Apr-06

Jun-0

6Aug

-06Oct-

06Dec-0

6

10%

12%

14%

16%

18%

20%

0100200300400500600700

Nov-03

Jan-0

4Mar-

04May

-04Ju

l-04

Sep-04

Nov-04

Jan-0

5Mar-

05May

-05Ju

l-05

Sep-05

Nov-05

Jan-0

6Mar-

06May

-06Ju

l-06

Sep-06

Nov-06

10%

12%

14%

16%

18%

20%




0100200300400500600700

Nov-03

Jan-0

4Mar-

04May

-04Ju

l-04

Sep-04

Nov-04

Jan-0

5Mar-

05May

-05Ju

l-05

Sep-05

Nov-05

Jan-0

6Mar-

06May

-06Ju

l-06

Sep-06

Nov-06

18%

20%

22%

24%

26%

28%

30%

Appendix

129

Ratings

AA

AA

AA

AA

Long

R-1 (high)

R-1 (high)

R-1 (high)

R-1 (high)

Short

DBRS

AA-F1+AA-A-1+Aa3P-1Nordea Bank AB

A-1+

A-1+

A-1+

A-1+

Short

S&P

AAA

AAA

AA-

AA-

AA-

Long LongShortLongShort

A1P-1Norgeskreditt

AaaNordea Kredit

AaaNordea Hypotek*

AA-F1+Aa3P-1Nordea Bank N

AA-F1+Aa3P-1Nordea Bank F

AA-F1+Aa3P-1Nordea Bank D

FitchMoody’s

*Covered bond rating

130

32.3

0

5

10

15

20

25

30

35

40

SHB

Commerzbank

ABN AMRO

Danske

Bank

RBOSHBOS

UnicreditoSwed

bankKBC

Barclays

Lloyds

Erste B

ankBNP DnB

Allied Iri

sh Ban

ks

Hypove

reinsb

ank

Societe G

eneral

Nordea SEB

Bank of Ir

eland

% Top quartile

Total shareholder return (TSR) Ytd 2006(1/1 2006 – 29/12 2006)

131

Largest registered shareholders, year end 2006

0.50.4 %9.7Abu Dhabi-0.30.4 %9.7Skandia Funds

0.80.5 %12.3Länsförsäkringar Funds

-2.41.2 %30.1Nordea Funds

12.7

0.00.7 %18.2Fourth Swedish National Pension Fund-1.50.6 %14.4AMF Pension Funds

11.6

55.9 %1,459.0Other100.0 %

0.4 %

0.5 %

0.8 %0.9 %1.0 %

1.2 %1.3 %1.7 %1.8 %2.2 %2.3 %2.5 %4.0 %

19.9 %

Percent of Nordea

0,0Nordea Profit-sharing Foundation

2,594.1Total number of outstanding shares

-2.765.3Robur Funds-7.759.0Alecta

0.0515.6Swedish state0.0102.5Nordea Denmark Fund

-1.156.5SHB/SPP Funds0.046.3AMF Pension

-1.943.4SEB Funds4.034.7Sampo Oyj

0.2Govt of Singapore Inv Corp

-0.320.1Third Swedish National Pension Fund-1.423.5First Swedish National Pension Fund0.125.5Second Swedish National Pension Fund

-0.232.1Skandia Life Insurance

Change 30 days, mill shares

Number of shares, mill

Shareholder

132

3.93

2.54

4.42

3.06

3.99

3.24

3.84

3.05

30-09-06

4.04

2.94

4.86

3.69

4.12

3.74

3.98

3.57

31-12-06

0.11

0.40

0.44

0.63

0.13

0.50

0.14

0.52

Change Q4/06

Short, SE

Long, SE

Short, NO

Long, NO

Long, DK

Short, DK

Long, EUR (5 years)

Short, EUR (one week)

%

Market development – interest rates

133

Macro data – Nordic market

% 2006e 2007e 2008eGross domestic product DK 3.6 2.1 1.5

FI 5.6 3.2 3.6NO 2.6 3.4 2.8SE 4.3 3.4 2.5

Inflation DK 1.9 1.7 1.9FI 1.6 1.8 1.6

NO 2.3 1.0 2.1SE 1.4 1.4 1.3

Private consumption DK 3.9 2.6 1.6FI 3.6 2.5 2.8

NO 4.0 3.2 2.1SE 2.8 3.5 2.4

Unemployment DK 4.5 3.9 4.0FI 7.9 7.4 7.0

NO 3.6 2.9 2.8SE 5.4 5.3 5.1

Source: Nordea Markets Economic Outlook January 2007. In Norway, forecasts are for mainland GDP

134

Financial calendar 2007

Q1 report 2007 will be published on 3 May

www.nordea.com/ir

135

DisclaimerCertain statements made in this presentation are forward looking statements. Such statements are based on current expectations and are subject to a number of risks and uncertainties that could cause actual results and performance to differ materially from any expected future results or performance, express or implied, by the forward looking statements. Factors that might cause forward looking statements to differ materially from actual results include, among other things, regulatory and economic factors. Nordea assumes no responsibility to update any of the forward looking statements contained herein. No representation or warranty, express or implied, is made or given by or on behalf of Nordea or its 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 Nordea or any of its directors, officers or employees nor any other person accepts any liability whatsoever for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection therewith.This presentation does not constitute or form part of any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities of Nordea, nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision.

investor presentation 21 feb 2007 - nordea.com · investor presentation 21 february 2007. ceo...

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