SEB Debt Investor Presentation Paris March 2009
Upcoming SlideShare
Loading in...5
×
 

SEB Debt Investor Presentation Paris March 2009

on

  • 4,067 views

 

Statistics

Views

Total Views
4,067
Views on SlideShare
4,067
Embed Views
0

Actions

Likes
0
Downloads
7
Comments
0

0 Embeds 0

No embeds

Accessibility

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

SEB Debt Investor Presentation Paris March 2009 SEB Debt Investor Presentation Paris March 2009 Presentation Transcript

  • Anders Kvist Head of Group Treasury Debt Investor Presentation March 2009
  • This presentation does not constitute an offer for sale of securities of Skandinaviska Enskilda Banken AB (publ) (the “Company”) in the United States, Canada, Australia or Japan or other jurisdiction in which the distribution or release would be unlawful. Such securities have not been and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from registration thereunder. No communication or information related to the capital increase of the Company with preferential subscription rights (“Rights”) for the Company shares (“Shares”) referred to herein may be disseminated to the public in jurisdictions other than Sweden (and any other jurisdiction into which the offering of such Rights is passported) where prior registration or approval is required for that purpose. No steps have been taken or will be taken relating to the offering of Rights or Shares outside of Sweden (and any other jurisdiction into which the offering of such Rights is passported) in any jurisdiction in which such steps would be required. The issue, exercise or sale of Rights and the subscription or purchase of Shares or Rights are subject to specific legal or regulatory restrictions in certain jurisdictions. The Company assumes no responsibility in the event there is a violation by any person of such restrictions. This document does not constitute an offering circular or prospectus in connection with an offering of securities of the Company. Investors must neither accept any offer for, nor acquire, any securities to which this document refers, unless they do so on the basis of the information contained in the applicable prospectus published or offering circular distributed by the Company. This document does not constitute an offer to sell, or the solicitation of an offer to buy or subscribe for, any securities and cannot be relied on for any investment contract or decision. This document has not been approved by any regulatory authority. This document is an advertisement and not a prospectus and investors should not subscribe for or purchase any securities referred to in this document except on the basis of information provided in the prospectus to be published by the Company on its website in due course. Forward-Looking Statements This document and any other materials distributed in connection with this document may contain certain forward-looking statements. By their nature, forward-looking statements involve risk and uncertainty because they reflect the Company’s current expectations and assumptions as to future events and circumstances that may not prove accurate. A number of material factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. 2
  • Overview of the SEB Group 3
  • SEB – the key to North-European markets SEB has… an attractive platform high customer satisfaction resilient income generation several leading positions ...a strong customer base 2,500 large companies and financial institutions customers 400,000 SME customers 5 million private customers 4
  • A diversified platform Operating profit before credit losses, Jan – Dec 2008 Wealth Sweden Life Merchant Germany Management Banking 6% 9% Lithuania 11% 6% Latvia 5% Estonia 6% 35% 56% 4% Finland 48% 5% Denmark 9% Norway Retail Banking Geography – Adjusted for Other Divisions – Adjusted for Other Sweden – adjusted for centralisation of investment portfolio 5
  • Capital adequacy SEB Group Basel II Total capital ratio, % (without transition rules) Tier I capital ratio, % 14.6 * Basel I 12.6 12.8 9,3% 11.5 10.8 10.5 10.3 10.2 12.1 Basel I 10.1 9.9 8.2 7,3% 7.9 8.0 7.8 7.5 Dec Dec Dec Dec Dec Dec Dec Dec SEK bn 2002 2003 2004 2005 2006 2007 2008 2008 Basel I Capital base 52.7 54.7 58.7 76.2 85.8 93.0 100.3 121.0 1,127 Risk-w. Assets 503 535 570 704 741 737 818 818 * Proforma after capital measures 6
  • Ratings of Skandinaviska Enskilda Banken AB Rating target set by SEB's board of directors at AA Moody’s S&P Fitch DBRS Bank Senior Rating Short Term P-1 A-1 F-1 R-1 (middle) Long Term Aa2 A A+ AA (low) Outlook Negative Negative Stable Stable Last Action Outlook change Outlook change Outlook change Unaffected rating Date Dec-08 Mar-09 Jul-08 Jul-08 7
  • Capital Raising 8
  • Announced capital measures of SEK 19.5 bn The capital increase will be ● 2008 YE pro forma Tier 1 achieved through: Capital Ratio of 12.1% (Basel 1. A fully committed and underwritten II without transition floor) rights issue of SEK 15 bn of A-shares ● New long-term Tier 1 Capital 2. No dividend payments for 2008 target of 10% 9
  • Background and rationale Addresses market expectations of higher levels of 1 capital in the banking sector Further enhances capital ratios in response to the 2 changing environment - provides a substantial capital buffer Enhances SEB’s ability to be a strong business partner 3 for its customers 10
  • 1 Addresses market expectations of higher levels of capital Rights issue positions SEB in the top quartile of capital ratios among European and Nordic peers SEB is acting pro-actively in addressing any concerns surrounding its capital position SEB FY’08 Tier 1 ratio vs. peers SEB FY’08 Core Tier 1 ratio vs. peers SEB Post-Cap Measures (8) 13.3 10.4 (6) 12.1 9.9 SEB Post-Cap Measures (1) 11.5 9.3 9.1 10.8 (1) (1) 9.0 10.7 (1) 10.7 8.6 10.1 8.4 9.9 8.3 (1) (1) 9.8 SEB Pre-Cap Measures(7) 8.0 (1) 9.8 8.0 (2) 9.7 7.8 (1) 7.3 9.6 (3) (5) 7.3 9.4 SEB Pre-Cap Measures 7.3 9.3 (1) 7.2 9.3 7.0 9.2 (1) 6.7 9.1 (1) 8.8 6.7 (1) 8.5 6.4 (3) (2) 6.2 7.9 6.2 7.9 (4) 5.7 6.9 (4) (4) 5.5 6.5 (4) Other Western European Banks Nordic banks Ratios are based on latest available company reports (presented on Basel II basis and, where available, without transitional floors) and adjusted pro forma for announced dividend cuts, capital injections, mergers and acquisitions. Peers include the top 20 Western European banks by market cap and the six largest Nordic banks by market cap as at 03/03/2009. Notes: (1) Pro forma for capital injection (2) Pro forma for acquisition (3) As of 30/06/2008 (4) As of 30/09/2009 (5) Based on Tier 1 capital of SEK82,463 M as of 31/12/08, less SEK4,500 M of dividend cancelled pursuant to capital measures announced by SEB, less reduction in Tier 1 capital contribution of SEK786 M from perpetual subordinated debts as a result of the decreased share capital level, divided by total risk-weighted assets of SEK 817,788 M (6) Based on Tier 1 capital of SEK98,666 M, as adjusted for the amount of net proceeds of the rights issue, divided by total risk-weighted assets of SEK 817,788 M (7) Tier 1 capital per footnote (5) less Tier 1 capital contribution of SEK 12,371M, divided by risk-weighted assets of SEK 817,788M (8) Tier 1 capital per footnote (6) less Tier 1 capital contribution of SEK 13,974M, divided by risk-weighted assets of SEK 817,788M. 11
  • 1 Addresses market expectations of higher levels of capital Rights issue significantly improves leverage ratios SEB’s lending to the public only constitutes half of the balance sheet * (9) SEB FY’08 Tier 1 capital / total assets vs. peers SEB FY’08 tangible equity / tangible assets vs. peers 4.7 4.4 (1) 4.3 4.4 (2) (4) 4.0 4.4 3.7 4.4 (1) (3) 3.7 4.3 3.6 4.3 (3) 3.6 4.1 (1) 3.4 4.1 (6) 3.2 3.9 SEB Post-Cap Measures 3.2 3.8 (1) (1) 3.2 3.6 (4) (1) (8) 3.1 SEB Post-Cap Measures 3.4 2.9 (5) 3.1 SEB Pre-Cap Measures (1) SEB Pre-Cap Measures(7) 2.6 2.9 2.3 2.8 (1) (1) 2.2 2.6 (1) 2.2 2.5 (1) * The other half of balance 2.1 2.4 (1) sheet consists inter alia of 1.8 2.0 insurance assets and liabilities (1) (1) on behalf of policy holders, 1.7 2.0 (1) covered bond funding with 1.7 1.9 (1) assets maintained on the 1.5 1.7 balance sheet and derivatives. 1.0 1.4 Other Western European Banks Nordic banks Ratios are based on latest available company reports (intangible assets from most recent disclosure provided) and adjusted pro forma for announced dividend cuts, capital injections, mergers and acquisitions. Peers include the top 20 Western European banks by market cap and the six largest Nordic banks by market cap as at 03/03/2009. Notes: (1) Pro forma for acquisition (2) Pro forma for capital injection (3) As of 30/06/2008 (4) As of 30/09/2008 (5) Based on Tier 1 capital of SEK82,463 M as of 31/12/08, less SEK4,500 M of dividend cancelled pursuant to capital measures announced by SEB, less reduction in Tier 1 capital contribution of SEK786 M from perpetual subordinated debts as a result of the decreased share capital level, divided by total assets of SEK 2,510,702 M (6) Based on Tier 1 capital of SEK98,666 M, as adjusted for the amount of net proceeds of the rights issue, divided by total assets of SEK 2,525,302M, adjusted for SEK14,600M net proceeds of rights issue (7) Tangible equity based on total equity of SEK83,729M less intangible assets of SEK 19,395M, and tangible assets based on total assets of SEK2,510,702 less intangble assets of SEK19,395M (8) Based on tangible equity and tangible assets per footnote (7) adjusted for SEK14,600M of net proceeds of rights issue (9) Tangible equity is calculated as total shareholders’ equity plus minority interest less intangible assets, and tangible assets are calculated as total assets less intangible assets. 12
  • 2 Further enhances capital ratios in response to the changing environment Provides a substantial capital buffer 98.7 77.2 The global credit crisis, recession and unprecedented market volatility have put significant strain on the banking 60.6 sector Capital measures create a substantial buffer of true loss absorbing capital Enables SEB to create value and withstand a very significant deterioration in macroeconomic conditions Tier I capital Tier I capital Tier I capital 31 Dec 2006 31 Dec 2008 before 31 Dec 2008 pro capital measures (2) forma after capital measures Note 1. Numbers in SEK Bn 2. Calculated based on Tier 1 capital of SEK82,463 M as of 31/12/08, less SEK4,500 M of 2008 dividend cancelled pursuant to capital measures announced by SEB, less reduction in Tier 1 capital contribution of SEK786 M from perpetual subordinated debts as a result of the decreased share capital level 13
  • 2 Further enhances capital ratios in response to the changing environment SEB has a strong and diversified credit portfolio 85% of total credit exposure is in Nordics and Germany and only 10% in Baltics Credit portfolio is well diversified across types of borrowers Corporate portfolio has a pre-dominance of large corporate clients Norway 6% Denmark 2% Finland 2% Households Sweden Corporates 25% 50% 40% Germany 25% Banks 15% Estonia 3% Latvia 3% Public Lithuania 5% administration Property mgmt Other 5% 6% 14% Credit portfolio, SEK 1.9 trillion as of 31/12/2008 Note The chart above show the distribution by industry and location of SEB’s credit portfolio as of 31/12/08, which does not include SEB’s fixed-income investment portfolio. 14
  • 2 Further enhances capital ratios in response to the changing environment Highly rated credit portfolio High grade lending with investment grade in total portfolio ex. households accounting for 58% Similarly, 82% of Swedish household lending is investment grade Watchlist is only 2.5% of portfolio ex. households and 1.5% of household portfolio (1) Of which, Corporates (%) (1) Total credit portfolio excl. Households (%) (SEK 782bn) (SEK 1,449bn) 39.4 45.3 35.0 26.0 20.3 18.9 5.6 4.1 2.9 2.5 Risk Class '1 - 4 Risk Class '1 - 4 '5 - 7 '8 - 10 '11 - 12 '13 - 16 '5 - 7 '8 - 10 '11 - 12 '13 - 16 AAA/A- BBB BB B+/B B-/D AAA/A- BBB BB B+/B B-/D (2) (2) S&P S&P Swedish Households (%) (1) (SEK 269bn) Investment grade Watchlist 43.8 30.7 8.9 7.5 6.0 1.6 0.9 0.3 0.3 PD (%) 0 - 0.2 0.2 - 0.4 0.4 - 0.6 0.6 - 1.0 1.0 - 5.0 5.0 - 10.0 10.0 - 30.0 30.0 - 50.0 50.0 - 100.0 Note 1. As of 31/12/2008 2. Approximate relation to rating agency scales 15
  • 2 Further enhances capital ratios in response to the changing environment Asset quality deterioration driven by Baltics Credit losses ex-Baltics largely in line with Management expectations, sharp rise in net credit losses in Baltics in Q4 2008 Ex-Baltics reserve ratio at 73% Net credit loss level, % Impaired Loans by Credit Portfolio, % Impaired Loans/ Reserve Ratio (1) Credit Portfolio 0.63 Ex-Baltics 0.6% 73% Baltics 2.8% 56% Total 0.8% 66% 0.30 0.27 (1) Impaired loans as % of Credit Portfolio 0.17 0.13 0.13 0.84 0.12 0.75 0.10 0.19 0.69 0.08 0.65 0.65 0.65 0.64 0.64 0.15 0.13 0.11 0.10 0.10 0.10 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2007 2007 2007 2007 2008 2008 2008 2008 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2007 2008 Quarterly, annualised YTD, annualised Note 1. Calculated by dividing impaired loans (before netting off loan loss reserves) by credit portfolio, credit portfolio is after excluding exposure to banks and does not include fixed-income investment portfolio. 2008 ratio of 0.84% calculated by dividing impaired loans of SEK13,911M by credit portfolio of SEK 1,649Bn, net of credit exposure to banks of SEK 286Bn. 16
  • 2 Further enhances capital ratios in response to the changing environment Baltics: Proactively managing growth and focusing on key risk areas More limited organic growth in 2008 in local currency terms Key credit issues centered around Property Management and certain Corporate segments Credit Exposure, SEK Bn Baltic Portfolio as % of Total, as of 31 Dec 2008 Lithuania Total Estonia Latvia 202 168 Banks 0% 1% 0% 1% 131 47% 45% Corporates 23% 11% 47% 13% 43% 25% 25% 26% Property 8% 4% 16% 4% 28% 30% Management 31% Public 2006 2007 2008 2% 1% 3% 0% Administration Estonia Latvia Lithuania Households 11% 8% 14% 33% Credit Exposure growth rate in local currency Lithuania Latvia Estonia 2007 30% 18% 17% Total 28% 25% 47% 100% 2008 8% 5% -2% 17
  • 2 Further enhances capital ratios in response to the changing environment Managing Baltics: measures taken Baltics have been one of SEB’s core markets since acquisitions in 1998-2000 SEB has been proactive in recognising and taking actions to deal with imbalances and risks Nonetheless, there are substantial near- to mid-term challenges 2006 2007 2008 Increased Continued Re-allocation capitalisation integration of resources Tightening of Further tightening Work-out credit policy of credit policy units ROE priority Volume caps High Risk > volume Committees Collective provisioning Baltic SPVs Preparation for Dialogue with crisis scenario authorities 18
  • 2 Further enhances capital ratios in response to the changing environment Sharp increase in credit losses in Baltics Acceleration of deterioration in Lithuania during Q4 2008 after lower losses than other Baltic countries during Q1-Q3 2008 Impaired loans as % of credit exposure¹ (1) Baltic Loss Absorption, SEK m Impaired Loans as % of Credit Portfolio Estonia Latvia Lithuania 3.0 391 365 369 2.8 343 18 35 2.8 139 288 246 234 229 222 201 2.3 191 39 202 61 47 347 334 560 2.0 113 171 255 252 166 195 168 83 154 1.6 1.6 86 51 30 25 -9 1.5 1.2 -217 0.9 1.2 1.1 2008 2008 2008 0.8 1.1 0.8 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 0.7 Pre-Tax Profit Credit Losses Pre-Provision Profit Q1 2008 Q2 2008 Q3 2008 Q4 2008 Estonia Latvia Lithuania Full Year 2008 (SEK m) 821 903 1,468 Pre-provision profit Estonia Latvia Lithuania Baltics (512) (512) (752) Credit losses 309 391 716 Pre-tax profit Notes 1. Excluding banks 19
  • 2 Further enhances capital ratios in response to the changing environment Loan book quality improved despite challenging environment Average risk class of corporate book improved in 2008 Limited impact of risk class migration New lending to high grade customers more than offset risk class migration in 2008 Corporate risk class migration during Q4 2008* SEB Group Average risk class 100% (Excl households and banks) 90.4% Average year-end 2007 6.95 80% Net negative risk migration +0.15 60% Effect from new volumes -0.30 Down-Rated Up-Rated 40% Average year-end 2008 6.81 20% 4.9% 0.4% 0.3% 1.4% 1.1% 1.1% 0.1% 0.0% 0.0% 0.2% In 2008, ratings migration of 0% non-retail exposure is >-4 -4 -3 -2 -1 0 1 2 3 4 >+4 estimated to have increased # of internal risk class rating notches up- or down-rated RWA net by SEK 23bn, 2.8%. * Based on SEK 778bn of Exposure at Default (EAD) included in the IRB reported RWA calculation and where exposures existed at the end of Q3 and Q4 2008. As such, 94% of the Group’s corporate EAD for IRB is included. The remainder is explained by the inclusion of additional volumes in IRB during the quarter. IRB reported credit exposures 31 Dec 30 Sep 30 Jun 31 March 31 Dec Average risk weight for Corporate credit exposures 2008 2008 2008 2008 2007 Corporate credit exposures as reported by SE B 56.2% 53.3% 53.9% 51.0% 53.4% excluding addition of Baltic IR B exposures during 2008 53.5% 50.9% 52.0% 48.3% 53.5% excluding addition of Baltic IR B exposures during 2008 and repos 54.7% 55.5% 54.9% 56.7% 56.4% 20
  • 2 Further enhances capital ratios in response to the changing environment vHigh quality structured credit book High degree of high grade assets (93% AAA as of 31/12/2008) due to investment portfolio strategy since 1998 Limited exposure to real problem areas Limited impact of ratings migration Volume breakdown by structured credit type as of 31 Dec 2008 Product breakdown as of 31 Dec 2008 - SEK 68bn SEK Bn US UK Spain NL Italy Den Euro Other Total CDO Subprime RMBS 4.2 8.4 2.5 4.6 1.4 2.7 0.7 24.6 2% 7% CMBS CLO 5.4 1.1 5.6 0.5 12.6 7% RMBS 36% ABS 0.7 0.6 2.3 1.6 4.1 1.8 11.1 CMO 13% CMO 8.7 8.7 CMBS 0.4 0.8 0.2 0.2 3.0 4.6 CDO 2.6 0.2 1.6 0.2 4.6 ABS 16% SubPrime 1.6 1.6 CLO 19% 23.6 11.0 4.8 4.9 3.2 4.1 14.7 1.5 67.7 Ratings breakdown by structured credit category as of 31 Dec 2008 Ratings migration from AAA tranche during 2008 Investment- Non-Investment % of ratings % % % of ratings AAA Grade Grade 31 Dec 08 31 Dec 2007 Upgraded Downgraded RMBS 1.4% 35.0% 37.1% 93.0% AAA 99.6% 0% 0% CMO 12.8% 12.8% 3.5% AA/A 0.4% 0% 3.1% 0% CLO 18.6% 18.6% 1.8% BBB 0% 0% 1.8% 0.3% CDO 4.2% 6.4% 1.2% BB/B 0% 0% 1.2% 0% CMBS 6.4% 6.9% 0.5% CCC/CC 0% 0% 0.5% 0% ABS 16.0% 16.5% 100% Total 0% 6.6% 100% 1.70% Total 93.0% 98.30% 21
  • 2 Further enhances capital ratios in response to the changing environment Robustness of our capitalisation confirmed by severe stress testing Overview worst case scenario: Overview methodology: Extreme stress scenario – significantly more We apply a “bottom-up” approach to stress conservative than our base case testing, utilizing all our areas of expertise very low probability We have estimated the impact of a range of GDP scenarios, including a severe Scenario with simultaneous severe worsening, in each of our core markets on recessions with significant contraction in all SEB’s geographic markets for 3 consecutive revenues and expenses years loan losses Significant decline in pre-provision earnings capital and capital requirements Significant increase in RWAs from risk class migration, more than offsetting the effects of We have modelled scenarios, taking into full implementation of Basel II account a range of GDP scenarios and drawing upon our experience of the Swedish In all scenarios that SEB has tested, SEB banking crisis in the early 1990’s and past expects its capital ratios (assuming crises comparable to the one in Baltics successful completion of the Offering and non-payment of the 2008 dividend) would be above the level determined by the Swedish National Debt Office as a prerequisite to participation in the Swedish Government Guarantee program, which is a minimum Tier I capital ratio of 6% 22
  • 3 Enhances SEB’s ability to be a strong business partner for our customers Rights issue provides opportunities for SEB A Capital strength is key competitive advantage Enhanced ability to be a strong business partner for our B customers C Strengthened ability to act as market counterparty 23
  • 3 Enhances SEB’s ability to be a strong business partner for our customers SEB – built on long-term customer relationships and leading market positions in core business areas Strong customer base Product excellence Cash management globally Large companies Scandinavian currencies globally 1,800 Nordic stock broker Financial Nordic and Baltic investment institutions bank Custody Nordics and Baltics 700 Nordic asset management SMEs SMEs Sweden 400,000 Private individuals 5 million 24
  • Funding & Liquidity Management 25
  • Deposit Development Deposits from the public Lending to the public SEKbn SEKbn 900 1 400 800 1 200 700 1 000 800 600 600 500 400 400 Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4 Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4 2005 2006 2007 2008 2005 2006 2007 2008 Deposits to loans ratio Deposits to loans ratio 100% 90% 80% 70% 60% 50% 40% 30% 2001 2002 2003 2004 2005 2006 2007 2008 26
  • A range of short and long term funding options Short Term Funding programmes Long Term Funding programmes CP Programmes CD’s – Sweden – Yankee CD – France – London Branch – Global CP Senior unsecured bonds ECP – Germany – Sweden USCP Structured bonds US Extendible Covered bonds – Germany CD’s Public (Pfandbriefe) Mortgage (Pfandbriefe) – Yankee CD – Sweden (Säkerställda Obligationer) – London Branch Subordinated debt/Hybrid Tier 1 27
  • Funding structure SEB Group, Dec 2008 SEK 1,787bn Schuldscheins and CPs/CDs Reg Bonds 8% 2% Mortgage Covered Bonds Sweden 10% Deposits - General Mortgage Covered Public Bonds Germany 42% 3% Public Covered Bonds Germany 7% Senior debt 3% Deposits - Central Subordinated debt Banks Deposits - 3% 7% Interbank 15% * Over collateral within covered pools SEK 48bn 28
  • Funding structure – Issued Securities SEB Group, Dec 2008 SEK 634 bn CPs/CDs, 24% Subordinated debt, 8% Senior debt, 9% Schuldscheins and Reg Bonds, 4% Public Covered Bonds Germany, 20% Mortgage Covered Mortgage Covered Bonds Germany, 7% Bonds Sweden, 28% 29
  • Funding raised with original maturity > 1 year Jan – Dec 30th 2008, SEK bn Instrument Total Q4 YCD 5,9 2,9 Senior unsecured Germany 2 0,3 Senior unsecured Sweden 37,4 1,4 Structured bonds 13,4 0,2 Covered bonds Germany 29,7 0,6 Covered bonds Sweden 72,9 8,7 Hybrid tier 1* 4,7 0 Total 166 14,1 * Issued in Dec 2007 30
  • Funding raised with original maturity > 1 year Jan – Feb 2009, SEK bn Instrument Total Jan + Feb YCD 0 0 Senior unsecured Germany 0.02 0.02 Senior unsecured Sweden 0 0 Structured bonds 1.26 1.26 Covered bonds Germany 4.05 4.05 Covered bonds Sweden 4.18 4.18 Hybrid tier 1 0 0 Total 9.51 9.51 31
  • Loan/Deposit Ratio Overview Selected European Bank Q4 2008 Total Loans/Deposits Financial Institutions Loans/Deposits Customer Loans/Deposits 117% 272% Intesa Sanpaolo* Handelsbanken Handelsbanken 191% 253% 75% SocGen* Sw edbank 172% Sw edbank 73% 200% DnB NOR 161% DnB NOR Lloy ds* 178% 68% Nordea KBC HBOS* 154% 62% 177% HBOS* SEB Nordea 144% 167% 58% Bank of Ireland* Santander 142% Commerzbank 159% 52% Santander 133% Bank of Ireland* Handelsbanken 51% 155% Lloy ds* 128% Erste Bank* Danske Bank 50% 154% SEB 123% Bank of Ireland* SEB AIB* 123% 49% Commerzbank 153% Allied Irish* 9 46% 151% RBS* 120% Nordea Santander 115% 42% 148% Commerzbank Barclay s RBS* 41% Barclay s 113% 142% Sw edbank Lloyds TSB* Danske Bank 109% 138% 38% Danske Bank Barclays* 38% SocGen* 104% 132% BNP Paribas* RBS* BNP Paribas* 99% 37% 116% UniCredit* SocGen* Erste Bank* 36% 96% 113% BNP Paribas* Erste Bank Intesa Sanpaolo* 96% 34% AIB* 98% UniCredit UniCredit* 84% 33% 95% DnB NOR Intesa Sanpaolo 71% 29% KBC HBOS* 71% KBC *H1 2008/Q3 figures due to non-disclosure of Q4 data by the respective institutions Note: Analysis based on headline numbers for ”loans to customers”, ”loans to banks/financial institutions”, deposits from customers” and ”deposits from financial institutions” Source: Goldman Sachs 32
  • Recap of 2008 Results 33
  • Annual accounts 2008 Higher operating income Operating income, SEK bn ● Strong net interest income Operating Income Excluding one-offs and portfolio losses ● Lower commission income 2006 2007 2008 Operating income 38.7 40.4 41.1 12 ● Strong customer-driven foreign exchange and 8 M-t-M valuation losses of SEK 1bn 4 Flat underlying costs 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 06 07 08 ● Redundancy costs SEK 1bn (1) ● Variable salaries -30% Operating profit, SEK bn ● Pension provisions SEK 0.7bn Operating profit Excluding one-offs and portfolio losses Increased provisions for credit losses 2006 2007 2008 Operating profit 15.6 17.0 12.5 5 ● Mainly driven by the Baltic development 4 Resilient business activity 3 2 ● Lending to the public +21% 1 ● Deposits from the public +12% 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 ● Strong sales in several distribution channels 06 07 08 Notes 1. Decrease in variable salaries driven by decrease in short-term and long-term incentive compensation 34
  • Key figures SEK m 2008 2007 Strong revenues in Merchant Operating income 41,140 40,440 Banking division in Q4 2008, driven by Operating expenses -25,407 -23,194 financing activities Operating profit 12,471 17,018 high foreign exchange Net profit 10,050 13,642 transaction revenues improved fixed-income investment portfolio Return on Equity, % 13.1 19.3 performance Cost / income ratio 0.62 0.57 Merchant Banking income Credit loss level, % 0.30 0.11 supported by market share gains and weakened competition Basel II* Tier I capital ratio, % 10.1 9.87 *Without transition floors 35
  • Continued growth of Net interest income Net interest income, SEK m Loans to public, SEK bn Total NII +17% 1,297 1,205 1,099 1,132 18,709 1,017 1,048 1,021 1,067 15,998 951 926 916 921 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2007 2008 2006 2007 2008 Net interest income development 2008 Deposits from public, SEK bn 841 750 765 758 794 700 715 707 Total NII growth 2,711 628 643 626 644 1,699 Volume Growth Customer driven 217 Margin Development Other 795 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2006 2007 2008 36
  • Fee and commission income holding up Market shares Nordic Gross development Jan-Dec 2008 vs. Jan-Dec 2007, SEK m stock exchanges Turnover 2008 Jan – Dec 07 9.2% Jan – Dec 08 +3% -2% 5.4% 7,547 7,309 7,165 7,022 5.2% -18% 4.3% 3.9% -29% 4,114 Source: The Nordic stock exchanges 3,370 Assets under custody SEK bn ‘000s 1,808 Assets under custody 1,290 1,004 Transactions/day 648 6,000 200 150 4,000 100 Other Custody & Payment, New issues & Secondary 2,000 mutual funds cards, lending, advisory market & 50 deposits, derivatives 0 0 guarantees Q1 2006 Q1 2008 37
  • Net financial income holding up (1) Full-year breakdown over business areas, 2006 – 2008 SEK m 4,000 3,000 2,000 1,000 0 FX Equities Capital Markets Other incl Treasury -1,000 -2,000 Client-driven FX business MB investment portfolio ● SEK 133bn (31 Dec 2008) ● No.1 Nordic and No. 12 globally ● Structured credits 93 % AAA-rated ● Underpinned by strong corporate relationships (31 Dec 2008) ● Highly efficient trading platform Notes 1. Net financial income reflects the net financial income of the Foreign Exchange, Equities and Capital Markets business units within the Trading & Capital Markets business area of Merchant Banking as well as the net financial income generated outside these three business units which largely is derived from the Merchant Banking Investment Portfolio and Group Treasury. 38
  • Financial Development: Baltics Income and cost Operating Result SEK m SEK m Income Cost 6,000 6,000 5,695 5,671 5,000 5,000 4,081 4,000 4,000 454 3,000 3,000 2,479 2,127 86 1,776 2,000 2,000 1,726 3,114 2,269 1,000 1,000 1,416 0 0 2006 2007 2008 2006 2007 2008 Operating Result Credit losses C/I 0.42 0.37 0.44 Note: Result excluding net gains 39
  • A diversified platform Operating profit before net credit losses, Jan - Dec 2008 Wealth Sweden Life Merchant Germany Management Banking 6% 5% 11% Lithuania 9% Latvia 6% Estonia 5% 35% 56% 4% Finland 49% 5% Denmark 9% Norway Retail Banking Geography - Adjusted for Other, including eliminations Divisions - Adjusted for Other, including eliminations Sweden - adjusted for centralisation of investment portfolio 40
  • Strategic goals Customer Sustainable profit satisfaction: growth No 1 in chosen Long- markets Long-term term Highest Return on AA-rating Equity The leading bank in Northern Europe Grow revenues with existing customers through high medium-term interaction and increased share of wallet Short-to Cost management Risk management - Credit quality and work-out activities Maintain a strong capital and liquidity positions 41
  • Focus on Baltics 42
  • SEB’s Baltic lending relative the market SEB Per cent, Q2 2005 – Q4 2008 Lending total SEB Lending Estonia Latvia Lithuania EURbn EURbn EURbn 40 40% 40 40% 40 40% 30 30% 30 30% 30 30% 20 20% 20 20% 20 20% 10 10% 10 10% 10 10% 0 0% 0 0% 0 0% Q2 - Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 Q2 Q4 05 06 07 08 05 06 07 08 05 06 07 08 Excluding Leasing portfolio Source: Central Banks and SEB 43
  • Baltic countries – credit exposure On and off balance, SEK bn SEB Estonia SEB Latvia SEB Lithuania 95,2 Banks 76,4 29 Public 56,6 22 56,3 49,8 Administration 50,0 16 13 40,7 41,4 13 Households 23 16 19 33,6 8 14 14 7 10 9 8 46 5 8 Property 4 39 34 25 23 22 21 Management 18 17 Corporate Dec Dec Dec Dec Dec Dec Dec Dec Dec '06 '07 '08 '06 '07 '08 '06 '07 '08 2006 2007 2008 YTD 2006 2007 2008 YTD 2006 2007 2008 YTD +5% +40% +18% +47% +30% +8% +38% +17% -2% Growth rates in local currency 44
  • Asset quality Baltics Impaired loans gross Provisions for Net Credit Losses % of credit exposure excl. banks % of lending Estonia Latvia Lithuania 6,0% 1,80 5,0% Germany Baltics Nordics SEB Group 1,60 4,0% 3,0% 1,40 2,0% 1,0% 1,20 0,0% 1,00 dec-07 mar-08 jun-08 sep-08 dec-08 Estonia 1.17 Latvia 1.43 0,80 Provisioning to build up reserves Lithuania 1.26 Baltics 1.28* SEK m 0,60 Specific Collective 1000 0,40 800 600 0,20 400 0,00 200 2006 2007 2008 *Annualised figures 0 2007 2008 45
  • Baltic countries - asset quality Net credit losses Impaired Q4 Q1 Q2 Q3 Q4 loans, % 2007 2008 2008 2008 2008 Q1 2007 – Q4 2008, SEK m 600 Estonia 0.4 0.7 1.6 2.0 2.3 500 Corporate 0.2 0.5 2.0 2.2 2.5 Private 0.7 1.1 1.3 1.8 2.1 400 Latvia 0.5 0.8 1.1 1.6 2.8 300 Corporate 0.3 0.3 0.6 1.0 2.2 Private 1.0 1.5 2.0 2.8 3.9 200 Lithuania 0.8 0.9 1.0 1.2 3.0 100 Corporate 0.8 0.8 0.9 1.1 3.8 0 Private 0.8 1.2 1.4 1.6 1.7 Estonia Latvia Lithuania Corporate including Property Management Impaired loans gross 46
  • Baltic countries – net credit losses Jan – Dec 2008, SEK m Estonia Latvia Lithuania Total % Net write-offs & actual losses 0 -13 -1 -15 0.8 Net new specific provisions -323 -142 -357 -822 46.3 Net new collective provisions -184 -352 -376 -912 51.4 Change in value of seized assets -4 -4 -18 -26 1.5 Net credit losses -512 -512 -752 -1,775 47
  • 48