jan erik back - seb · 2014. 9. 18. · q4-2010 with 7.3% yoy gdp growth but seb continues to...
TRANSCRIPT
Morgan Stanley Financials
Conference
Jan Erik BackCFO
29 March 2011
22
●
SEB today
●
Priorities during 2010
●
SEB going forward
33
Highlights 2010 results
Higher activity levels
Further improved asset quality
Enhanced return on equity
Income
Profit SEB Baltic
RoE
Q4
14.3%
4
Profit and loss trend
Operating profit (SEK bn)
10.0
6.2
0.4
Operating income Operating expenses Net credit lossesQ4-10 Q4-10 Q4-10
Note: Shaded
areas refer
to gain
on buy-back
of subordinated
debt, acquisition
goodwill write-offs, restructuring
costs
and impairment
charges respectively
3.6
4.3
Q4-08 Q1-09 Q2-09 Q3-09 Q4-09 Q1-10 Q2-10 Q3-10 Q4-10
Profit and loss development Q4-08 –
Q4-10 (SEK bn)
5
Theme #1: NII growth
Gradual recovery of NII from more normal funding and liquidity costs
Signs of new corporate lending
Deposit margins widening from record low levels following higher short-term rates
Positive gearing for higher Swedish repo
rates, +100 bps = SEK 1.3bn
Net interest income (SEK bn)Key Drivers
-1
0
1
2
3
4
5
6
Q107
Q2 Q3 Q4 Q108
Q2 Q3 Q4 Q109
Q2 Q3 Q4 Q110
Q2 Q3 Q4
Lending Deposits Other
6
Baltic net credit loss dynamics (SEK bn)
6
Theme
#2: Upbeat
asset quality
First bank to report net releases of provisions driven by Baltic region
Stars were aligned: no hick-up anywhere in the Group
Non-performing loans decreasing
Only 15 per cent of all reserves in the Baltic region realised
Credit loss level for the Group 14bps 2010, 7bps outside the Baltics. Guidance of 20-30 bps over a business cycle
Build-up of provisions
2008 2009 2010 2011 ?
Realizing losses
0.7
0.3
-0.4
-1.4
-2.6-2.5-2.6
-1.7
-0.9
-0.4-0.3-0.2
Q1-08
Q2 Q3 Q4 Q1-09
Q2 Q3 Q4 Q1-10 Q2 Q3 Q4
Baltic countries
Key Drivers
7
Theme
#3: Corporate
portfolio
Promising dynamics
Committed facilities +22%
Retail corporate portfolio in Sweden +18%
Lending at a trough in the summer
459 461 464 490 509
90 100 103 99 10660 55 53 53 51609 615 620 642 666
0100200300400
500600700800
Dec '09 Mar '10 Jun '10 Sep '10 Dec '10
Nordic & Other Germany Baltics
Geography based on SEB's operations; Dec 10 exchange rates applied historically
Lending
340
343
334
338
347Cont. liabilities
241
240
251
275
294Derivative
28
32
36
30
25Total
609
615
620
642
666
+9% YoY
-15% YoY
+18% YoY
+11% YoY
SEB Group, corporate credit portfolio
(SEK bn)
88
●
SEB today
●
Priorities during 2010
●
SEB going forward
9
Strategy for regulatory changes
Maintain more than adequate capital ratios in the short-term –
flexibility. Current B2 CT1 12.8%=B3 CT1 11.3%
Gradually close the NSFR gap–
Issue > maturing–
Gradually extend maturity
Upgrade liquidity portfolio–
Reduce non LCR compliant papers
–
Focus on high quality papers
106 97110
98
166
130
102120
Other Covered bonds Maturing debt
Long-term funding
(SEK bn)
2008 2009 2010 Future
Strategy
10
SEB’s
financial
position
10
Core
Tier
1*
Matched
funding
Leverage
ratio
(FDIC)
2007 2008 2009 2010
8.4% 8.6%
11.7% 12.8%12.8%
25x23x
18x 17x17x
12 months7 months
17 months 18 months18 months
Dividend SEK 4.4bn SEK 0bnSEK 2.2bn SEK 3.3bnSEK 3.3bn
* Basel II without transitional floor; 2010 pro forma for disposal of German retail
11
Great position for growth in areas of strength
Growth strategyPrerequisites
Core relationship growth
No ailing businesses
Desired business mix in place
One SEB business model
Strong capital position
Scalable platform
Investments in Nordic & German wholesale franchise and SMEs and savings in Sweden
12
Core relationship growth Attractive position
Large corporates
Sweden Private Banking
Cards Baltic Retail BankingNordic model with strong local presence
Building the most respected and top ranked home bank
Continued risk management
Develop customer franchise
Strengthen core markets
Number 1 in the Nordics
One Nordic company –
integration and scale of economies
Excel in #1 position in Sweden
Attract new assets under management
The only truly embedded bank
Top ranked products across the line
Continue to excel the competition
13
Core relationship growth Merchant Banking expanding from a position of strength
●
Prime brokerage
●
Shipping
●
Acquisition finance
●
Upgrade the organisation
●
Add additional country analysts
●
The only truly embedded bank
●
Top ranked products across the line
Large corporates SwedenContinue to excel the competition
●
Excel in Number 1 position in Sweden
●
Attract new asset under management
●
Work more cross-divisional
Financial institutionsUtilize the strong platform
Emerging marketsKeep the # 1 position
Specific segmentsBecome most respected in selective segments
14
Export-led economic recovery
Consumer confidence returning
Strong franchise -
customers, employees, solutions & brand
-20
-15
-10
-5
0
5
10
15
2007 2008 2009 2010 2011f 2012f
Estonia Latvia Lithuania
10-point plan running according to plan
Increased focus on new business activities
Core relationship growth Strong rebound in Baltics, back in black since Q3-10
BalticsGDP development, %
15
Great position for growth in areas of strength
Growth strategyPrerequisites
Core relationship growth
Geographic growth
Segment growth
No ailing businesses
Desired business mix in place
One SEB business model
Strong capital position
Scalable platform
Investments in Nordic & German wholesale franchise and SMEs and savings in Sweden
1616
Geographic growth Nordic and German corporate expansion
Development 2010
More than 100 new clientsSeveral headline transactions
Focus areas 2011-13
Gain 400 new clients No. 1 overall rank for large corporates
in the Nordics The bank of choice for German Mittelstand clients
Complete recruitments
Benefit from corporate refinancing and pick-up in credit demand
Accelerate market activities
Execute, execute, execute
Nordics
Laid groundwork for growth, now positioned for recovery
GermanyFocused on sale of Retail banking business and improved corporate business proposition
17
-100
100
Core relation-
ships%
0
2012 desired position2009
Corporate
target
market
2006
Sweden
* Relative to mean
performance in relative market (Source: Greenwich)
Geographic growth Potential through investments in client coverage
Perceived quality*
100
Country Wallet penetration
Norway
Finland
Germany
Sweden
Denmark
Potential
Nordics
18
Nordic and German expansion according
to plan
Joint coordinator NOK 1bn and joint manager NOK 700m
Joint coordinator EUR 1.5bn
Sole advisor on acquisition of Cardo
and sole arranger of SEK 14.3bn facility
Sole underwriter EUR 300m
Large
cap clients:
Client executives:
Loans
and commitments:
+88
+63
+62bn
Best corporate bank in the Nordic region among Tier 1 corporates
Financial advisor of the year in the Nordic region
Best FX, trade finance and cash management in the Nordic region
18
19
Supported with a strong pedigree
2010 -
The Corporate Bank of the year
2009 and 2008 the SME bank of the year
0%
2%
4%
6%
8%
10%
12%
14%
16%
2005 2007 2009 2011F 2013F
Segment growth A true business partner for SMEs
Strong offering and increased focus
Increase position in micro-SMEs
Expand footprint in larger SMEs
Improve customer experience
Credit portfolio grow by 18 per cent in
2010
SME market share Sweden (%)
19
20
Segment growth Focus on savings
Rising net sales in WM
0
10
20
30
40
50
60
2008 2009 2010
Institutional Clients Private Banking
Total net sales (SEK bn)
20
25
15
12
17
25
0% 50% 100%
Lith
uani
aE
ston
iaS
wed
en
SEB's market share Competitors
#1
#2
#3
#3
#2
Market shares (%)
Leading in unit-linked
SEB rank
New savings account
Byta
2121
●
SEB today
●
Priorities during 2010
●
SEB going forward
2222Source: SEB's
Chief Financial Officers‘ confidence survey, addressed to over 100 of the largest companies in Sweden and Norway (Feb 2011)
Economic sentiments positive…
354045505560657075
Feb-07 Feb-08 Feb-09 Feb-10 Feb-11
SEB's
Financial Officers Survey 2007-2011 “Business Climate”
Swedish corporate lending growth vs. economic sentiment
Source: Datastream, SEB Enskilda
708090
100110120130
Jan-97
Jan-98
Jan-99
Jan-00
Jan-01
Jan-02
Jan-03
Jan-04
Jan-05
Jan-06
Jan-07
Jan-08
Jan-09
Jan-10
Jan-11
-10%-5%0%5%10%15%20%
Growth in economic sentiment Y-o-y corporate loan growth lagged by 12 months
23
…on the back of strong fundamentals
Nordic countries benefit from strong economies
Low sovereign debt levels
Balanced budgets
Ongoing positive sentiment in export regions such as Asia, Latin America and Germany
Sweden saw record growth in Q4-2010 with 7.3% YoY
GDP growth
But SEB continues to maintain its resilience and flexibility given market chocks like the recent events in Japan
-8
-6
-4
-2
0
2
4
6
8
Sweden Norway Denmark Finland Eurozone
2009 2010 2011F 2012F
GDP development
(%)
2424
Priorities for 2011
Exploit core strengths
Maintain flexibility & resilience
Corporates
in Nordics & Germany Universal bank in Sweden & Baltics
2525