Presentation Financial Results Q3 - 2012 SpareBank 1 Gruppen AS

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Presentation Financial Results Q3 - 2012 SpareBank 1 Gruppen AS

  1. 1. 3rd Quarter 2012 Q Q3Presentation of resultsfrom SpareBank 1 GruppenKirsten Idebøen, CEO 18 October 2012
  2. 2. Solid improvement in profits compared with last year - Measures to further improve competitive strength and profitability Pre-tax profit Group – quarterly (MNOK) • Pre-tax profit as at Q3: MNOK 553 (248) Pre tax Q1 • Net profit as at Q3: MNOK 491 (245) Q Q2 256 Q3 • Annualised return on equity: 12.7 (7.0) %162 173 • Group’s total assets were NOK 46.6 billion, 145 123 compared t NOK 42.0 billi d to 42 0 billion at year-end t d 2011 • Good solvency: – Capital adequacy ratio: 16.7 % against 16.2 % as at 31.12.2011 – Core capital adequacy ratio: 15.3 % against -60 14.6 14 6 % as at 31.12.2011 31 12 2011 2011 2012 – Well capitalised to satisfy the new, stricter capital requirements upon introduction of the Solvency II regulations2
  3. 3. Financial performance per business area Pre-tax profit per subsidiary – YTD (MNOK) • The administration result in SpareBank 1 Livsforsikring has showed a positive trend. 421 The company built up further buffers and 380 YTD 2011 increased reserves for long life expectancy.316 YTD 2012 • Higher financial result contributed to a substantial increase i profits i S b t ti l i in fit in SpareBank 1 B k Skadeforsikring. Improved insurance result. • Lower average total assets in 2012 than in 18 30 22 18 2011 in ODIN Forvaltning has led to reduced 0 management fees. -77 •S SpareBank 1 Gruppen Finans i experiencing k G i is i i -154 pressure on margins in the factoring business and weaker growth in the debt collection market. Good growth in portfolio activities. kets ans SB1 Liv ade SB1G Fina SB1 Ska ODIN N SB1 Mark • Good growth in turnover in SpareBank 1 Markets, mainly within DCM, but still net loss for the period period. 3
  4. 4. Combining life insurance and P&C insurance into a single business area – ”SpareBank 1 Forsikring” SpareBank Forsikring SpareBank 1 is consolidating its insurance services, in order to create a comprehensive customer offering, better customer experience – as well as increased competitive g, p p strength and a better basis for additional sales and cross-selling. Combining the business operations will also: • Create more efficient processes throughout the entire value chain and better coordination with distributors (the SpareBank 1 banks and LO) • Result in lower costs • Mean fewer employees, a process that has primarily been attempted through reductions in temporary staff, natural turnover and voluntary packages Key figures as at 30/09/2012 • Preliminary estimates of cost synergies indicate a full annual effect of about MNOK 100 from 2014 SpareBank 1 SpareBank 1 Livsforsikring Skadeforsikring • Turid Grotmoll has been appointed to lead the new new, consolidated insurance unit. Gross written premium (MNOK) 2,711.6 4,316.8 Pre-tax profit (MNOK) 380.4 421.0 Total assets (MNOK) 28,411.7 14,477.6 • A consolidation of the business units will require the Number of employees 271 428 authorities authorities’ approval4
  5. 5. SpareBank 1 Livsforsikring Improved administration result. Good b ffe capital buffer5
  6. 6. SpareBank 1 Livsforsikring Improved administration result. Good buffer capital • Pre-tax profit: MNOK 380 (316) as at Q3 and MNOK 145 (78) in Q3 Pre-tax profit – quarterly (MNOK) P t fit t l • Administration result: MNOK -30 (-63) as at Q3 and MNOKQ1 -3 (-20) in Q3Q2Q3 • Risk result: MNOK 202 (203) as at Q3 and MNOK 80 (63) 142 145 in Q3 129 – Good risk result in spite of large compensation payments in Q1 109 and increased reserves in connection with disability compensation 10092 94 86 78 • Investment result: MNOK 218 (365) as at Q3 and MNOK 97 (52) in Q3 – MNOK 74 allocated to strengthen reserves for longer life expectancy as at Q3 t t – Net forward exchange gains of MNOK 3 were realised for the year-to-date, compared with MNOK 161 last year 2010 2011 2012 • C Consequences of th proposal to amend the regulations f the lt d th l ti relating to the tax exemption method*: – Estimated one-off cost in the range of MNOK 175-200 that will be recognised in Q4** – C Company ttax ahead will approach a normal rate of 28 % h d ill h l t f * The proposal does not include transition rules related to the tax opening value. Historical cost price will lead to a significant one-off cost when calculating the latent deferred tax. 6 ** Large degree of uncertainty associated with the estimate because details of the new regulations are not known.
  7. 7. SpareBank 1 Livsforsikring The company has built up solid buffers Buffer capital trend – per quarter (%) Securities adjustment reserve – accrued (MNOK) 16.3 % 14.6 % 15.2 % 14.8 % 14.0 % 14.1 % 617 12.8 % 11.0 % 556 327 185 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2010 2011 2011 2011 2011 2012 2012 2012 13 Core capital in excess of minimum Interim profit Additional provisions Securities adjustment reserve 2009 2010 2011 30/09/2011 30/09/2012• Total assets: NOK 28.4 (26.6) billion• Capital adequacy ratio: 19 0 % against 18.5 % at 19.0 18 5 31.12.2011 – The entire subordinated loan comprises core capital – Estimated solvency margin of 320.7 %, compared to 303.5 % at year end 2011 t e7
  8. 8. SpareBank 1Skadeforsikring GroupHigher financial iHi h fi i l income and i d improved i d insurance result. ltThe markets most satisfied insurance customers8
  9. 9. SpareBank 1 Skadeforsikring Group Higher financial income and improved insurance result. The markets most satisfied insurance customers • Pre-tax profit: MNOK 421 (18) as at Q3 and Pre-tax profit – quarterly (MNOK) Pre tax MNOK 185 ( 89) i Q3 (-89) in Q1 254 Q2 • Insurance result*: MNOK 37 (-21) as at Q3 and Q3 MNOK 25 (1) in Q3 185 – The underlying underwriting profitability has improved 166 during the year, particularly for the parent company – The sales process for Unison Forsikring was closed – 70 the company will be integrated into SpareBank 1 36 43 50 56 Skadeforsikring • Net financial income: MNOK 418 (100) as at Q3 and MNOK 173 (-62) in Q3 -89 – Financial return: 4.1 (1.1) % 2010 2011 2012 • Net earned premium of NOK 3.8 (3.5) billion, corresponding to a growth of 9.0 % compared* Insurance result in Q3 2011 and 2012 includes Unison with the same period last yearForsikringF ik i 9
  10. 10. SpareBank 1 Skadeforsikring Group Improved profitability within house and home insurance. A number of insurance measures implemented to improve the combined ratio Combined ratio for own account – accumulated (%) Combined ratio for own account – quarterly (%) 103.5 96.9* 99.9 94.5* 96.2 97.7 94.0 105.5 105.8 22.9 100.3 101.9 100.7 101.6 101.5 96.6* 21.0 22.6 96.5 21.9 22.5 89.8 89 8 21.9 21 9 21.1 21 1 23.8 22.4 21.3 24.2 26.0 22.322.7 76.7 80.6 77.3 84.7 72.1 73.8 83.6 79.4 80.4 77.4 76.6 74.7 74.167.1 2008 2009 2010 2011 YTD 2012 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q32010 2010 2011 2011 2011 2011 2012 2012 2012 Net claims ratio Net cost ratio Net claims ratio Net cost ratio *C Combined ratio f own account including personal insurance in SpareBank 1 Livsforsikring bi d i for i l di li i S B k Li f ik i10
  11. 11. SpareBank 1 Skadeforsikring Group We have the markets most satisfied insurance customers market s • The insurance company is at the top of customer satisfaction surveys in the P&C insurance industry Norwegian Finance Barometer (Norsk Finansbarometer) 2012 Høy Customer 70 Retention 65 60 55 50 45 40 35 30 2006 2007 2008 2009 2010 2011 2012 SpareBank 1  61 64 61 68 63 64 63 Skadeforsikring Gjensidige  61 63 61 65 62 64 61 Skadeforsikring Skadeforsikring 58 59 58 61 61 61 61 Tryg 56 54 56 52 58 57 60 If Skadeforsikring 53 54 55 52 52 49 55 • The company is actively working to maintain its position as the P&C insurance company with the most satisfied customers, before and after a claim11
  12. 12. SpareBank 1 Markets Strengthened p g position within DCM, but still net , loss for the period12
  13. 13. SpareBank 1 Markets Strengthened position within DCM, but still net loss for the period Results ● Total turnover ” SpareBank 1 can, through SpareBank 1 − As at Q3: MNOK 99 ( ), up 40 % Q (71), p − In Q3: MNOK 27 (13), up 111 % − Gross value creation in the SB1-alliance of Markets, provide the entire capital structure, MNOK 165 for the year-to-date, of which MNOK from bank loans to bonds and equity 66 is recognised as income in the owner banks ” ● Pre-tax profit − As at Q3: MNOK -154 (-77) − In Q3: MNOK -64 (-52) • Significantly strengthened position in the market for g y g p bond issues during the year. Market share for bond issues is growing strongly* 10 % • Weak on Corporate Finance in the 3rd quarter. 7% • The goal of profitable operations from Q4, given normalised markets, stands firm. The company has implemented a number of measures focused on income. 2% A strong growth in income is expected in the future. 2011 2012 01/05 - 30/09/2012 (as of 30/09) after start-up rated balance Looking ahead the focus will be to realise the substantial potential of being a bank-owned brokerage firm with access * Source: Norsk Tillitsmann to the bank balance sheet, considerable expertise and good customer relations. Consequently, the companys position and competitive strength is expected to be f further enhanced during the next quarters.13
  14. 14. O ODIN Forvaltning o a g Strong focus on management results and cost structure14
  15. 15. ODIN Forvaltning Strong focus on management results and cost structure • Pre-tax profit as at Q3: MNOK 0 ( ) p Q (30) Pre-tax profit – quarterly (MNOK) – Management fees totalled MNOK 195 (242) 17 17 Q1 • Pre-tax profit in Q MNOK 2 ( ) p Q3: (6)14 Q2 – Management fees totalled MNOK 64 (69) 12 12 Q3 • Total assets of NOK 24.4 billion as at 30 September 2012 6 – Lower average daily total assets than at the end of September last year 1.9 – Increased by NOK 0.8 billion in Q3 2012 08 – Up by NOK 0.9 billion from 31.12.2011 -0.5 -1.5 • Measures to improve earnings 2010 2011 2012 – Focus on the management processes – New CEO took over in Q3 – Measures will be implemented on the cost side p15
  16. 16. ODIN Forvaltning Nine out of twelve equity funds performed better than their benchmark as at 30 September 2012 Return on equity fund as at 30.09.2012 (%) 22.6 20.2 Fund Benchmark 17.8 17 8 17.2 17 2 13.7 13.5 14.4 12.4 12.0 9.3 10.1 9.5 9.0 8.3 8.8 7.8 7.1 7.0 6.7 3.5 3.0 30 0.1 -0.7 -9.9 ODIN ODIN ODIN ODIN ODIN ODIN ODIN ODIN ODIN ODIN ODIN ODIN Norge Sverige Finland Norden Europa Europa Global Global Emerging Maritim Offshore Eiendom I SMB SMB Markets16
  17. 17. SpareBank 1 Gruppen Finans Group Pressure on margins in the factoring business and weaker performance in the debt collection market. Good growth in p g portfolio activities17
  18. 18. SpareBank 1 Gruppen Finans Group Pressure on margins in the factoring business and weaker performance in the debt ll ti d bt collection market. G d growth i portfolio activities k t Good th in tf li ti iti Pre-tax profit – accumulated (MNOK) • Pre-tax profit as at Q3: MNOK 18 0 (22.0) Pre tax 18.0 (22 0) YTD 2011 21.5 22.0 • Pre-tax profit in Q3: MNOK 3.8 (12.2) YTD 2012 18.0 • F t i Factoring h grown strongly over the last year, but a has t l th l t b t reduced operating margin is putting pressure on earnings 13.8 • Flat growth in the debt collection market. Lower debt11.0 collection revenues in Conecto due to a reduced number of ll ti i C t d t d d b f referrals and customer loss 7.8 • Higher interest income in Portfolio administration as a result 5.0 of higher portfolio volume, as well as good recovery f hi h tf li l ll d 2.5 • Business area within the acquisition of portfolios of claims that are then recovered by the Groups debt collection company Factoring Conecto Portfolio SB1G Finans • Measures have been implemented on the pricing side in (debt Group collection) Factoring, collaboration with the alliance banks has been expanded and sales resources have been bolstered to improve earnings in ConectoPre-tax profit for SpareBank 1 Gruppen Finans Group also includesP t fit f S B k G Fi G l i l dmanagement and amortisation.18
  19. 19. Outlook SPAREBANK 1 GRUPPEN • SpareBank 1 Gruppen will continue, in close collaboration with the SpareBank 1- banks, its work on cooperation right across the companies to extract efficiency gains within costs, income and know-how. • Underwriting profitability within P&C insurance is expected to be improved further over the next several quarters. • SpareBank 1 Gruppen is exposed to the securities market through its various subsidiaries, and the development of stock market prices and interest rates will have a major effect on the Groups earnings. • SpareBank 1 Gruppen is well equipped to face the new capital requirements in relation to the introduction of the Solvency II reforms.19
  20. 20. The nation s savings bank nations 2020
  21. 21. Appendix A di21
  22. 22. The SpareBank 1 Alliance SpareBank 1 SpareBank 1 SpareBank 1 Sparebanken Samarbeidende LO (Trade Union) SR-Bank SMN Nord-Norge Hedmark Sparebanker (10 %) (19.5 %) (19.5 %) (19.5 %) (12 %) (19.5 %) SpareBank 1 Gruppen AS SpareBank 1 ODIN SpareBank 1 Markets Livsforsikring Forvaltning (97.55 %) (100 %) (100 %) Alliance Cooperation SpareBank 1 SpareBank 1 SpareBank 1 Medlemskort Gruppen Finans Skadeforsikring (100 %) (100 %) (100 %) Broad cooperation - Technology - Brand/communication Unison Forsikring -EExpertise i Conecto - Common processes and use of best practice (100 %) (100 %) - Purchasing Regional competence centres (Bank-owned companies) - Payment services: Trondheim y SpareBank 1 Boligkreditt - Credit: Stavanger EiendomsMegler 1 - Training: Tromsø BNbank SpareBank 1 Oslo og Akershus22
  23. 23. Return on equity after tax among selected Nordic financial institutions Average Q3 2012 2011 2010 2009 2009-2011 SpareBank 1 Gruppen 12.7% 11.1 % 18.7 % 18.1 % 16.0 % Gjensidige* N/A 11.9 % 13.1 % 11.1 % 12.0 % Handelsbanken N/A 13.5 % 12.9 % 12.6 % 13.0 % Nordea N/A 10.6 % 11.5 % 11.3 % 11.1 % DNB N/A 11.4 % 13.6 % 10.6 % 11.9 % Storebrand N/A 6.0 % 10.8 % 8.2 % 8.3 % Danske Bank N/A 1.4 % 3.6 % 1.7 % 2.2 % * Calculated as net profit distributed over average equity. Source: The companies interim reports for Q3 201223
  24. 24. SpareBank 1 Gruppen Key figures Q3 Q2 Q1 Q4 Q3 Q2 Q1 Year 2012 2012 2012 2011 2011 2011 2011 2011 Group Net result for the period (MNOK) 227.7 63.4 199.9 281.0 -4.3 97.2 151.9 525.8 Return on equity (%) R t it 12.7 12 7 % 10.5 10 5 % 15.9 15 9 % 23.2 23 2 % -0.3 % 03 8.1 81% 12.9 12 9 % 11.1 11 1 % Capital adequacy ratio, cumulative (%) 16.7 % 15.9 % 14.8 % 16.2 % 16.3 % 16.2 % 16.1 % 16.2 % Core capital adequacy ratio, cumulative (%) 15.3 % 14.5 % 13.1 % 14.6 % 14.0 % 13.9 % 12.6 % 14.6 % SB1 Livsforsikring Risk result (MNOK) 79.7 92.6 29.4 38.5 63.5 70.1 69.4 241.4 Administration result (MNOK) -3.1 -19.0 -7.5 -3.2 -19.8 -24.2 -18.7 -65.9 Investment result (MNOK) 97.3 47.0 73.2 3.1 51.6 108.0 205.8 368.5 Net N t result for the period (MNOK) lt f th i d 128.7 128 7 89.1 89 1 125.8 125 8 193.7 193 7 114.6 114 6 73.8 73 8 129.9 129 9 511.9 511 9 Buffer capital in % of insurance provisions*, cumulative (%) 16.3 % 14.8 % 12.8 % 11.0 % 14.1 % 14.0 % 15.2 % 11.0 % Capital adequacy ratio, cumulative (%) 19.0 % 20.0 % 17.5 % 18.5 % 18.5 % 17.1 % 19.2 % 18.5 % Securities adjustment reserve, cumulative (MNOK) 555.5 389.6 465.9 184.9 13.0 326.3 448.2 184.9 SB1 Skadeforsikring Group Operating result before finance (MNOK) 24.9 31.1 -19.5 -16.0 0.5 8.2 -29.9 -37.3 Net financial income (MNOK) 172.8 51.0 194.0 160.8 -62.3 66.8 95.1 260.3 Net N t result for the period (MNOK) lt f th i d 142.6 142 6 42.2 42 2 139.5 139 5 90.3 90 3 -81.2 81 2 41.8 41 8 39.8 39 8 90.7 90 7 Claims ratio, net (%) 77.4 % 74.1 % 80.4 % 74.7 % 84.7 % 79.4 % 83.6 % 80.6 % Cost ratio, net (%) 24.2 % 22.3 % 21.3 % 26.0 % 21.1 % 22.4 % 21.9 % 22.9 % Combined ratio, net (%) 101.5 % 96.5 % 101.6 % 100.7 % 105.8 % 101.9 % 105.5 % 103.5 % Portfolio (MNOK) 5,455 5,407 5,328 5,198 5,092 4,986 4,825 5,198 ODIN Forvaltning Management fees (MNOK) 64.0 63.4 67.2 61.8 69.4 85.5 86.8 303.5 Net result for the period (MNOK) 1.4 -1.0 -0.3 -7.0 4.3 8.9 8.6 14.8 Total assets under management, cumulative (MNOK) 24,370 23,541 26,173 23,433 22,539 30,101 33,348 23,433 Market share equity fund, cumulative (%) 8.3 % 8.4 % 8.9 % 8.9 % 8.8 % 9.9 % 10.6 % 8.9 % Market share combination fund, cumulative (%) 4.0 % 4.1 % 3.8 % 3.8 % 3.8 % 3.5 % 3.2 % 3.8 % SB1 Markets Total operating income (MNOK) 26.6 40.0 32.9 15.3 12.6 23.5 34.8 86.3 Net result for the period (MNOK) -46.6 -32.6 -32.5 -57.4 -37.3 -15.9 -2.4 -113.1 SB1G Finans Group Net result for the period SB1G Finans Group (MNOK) 2.7 5.4 4.9 4.4 8.4 1.8 4.5 19.1 Net result for the period SB1G Finans - parent company (MNOK) 1.8 1.0 2.2 4.1 3.7 0.1 1.4 9.3 Net result for the period Conecto (MNOK) 1.6 5.0 3.3 2.2 6.7 3.7 5.1 17.7 *) Buffer capital as at Q is shown after p ) p Q4 profits have been allocated24
  25. 25. SpareBank 1 Gruppen Results year to date 2012 Q3 Q2 Q1 Q3 Year to date Year Figures in MNOK 2012 2012 2012 2011 2012 2011 2011 Part of result from subsidiaries before tax - SpareBank 1 Livsforsikring 144.6 141.8 94.1 77.7 380.4 316.1 414.1 - SpareBank 1 Skadeforsikring Group 185.0 70.4 165.5 -88.8 421.0 17.7 185.3 - ODIN Forvaltning g 1.9 -1.5 -0.5 6.3 0.0 30.4 21.8 - SpareBank 1 Markets -64.2 -44.9 -44.8 -51.8 -153.9 -77.3 -154.8 - SpareBank 1 Medlemskort 2.8 2.4 2.8 2.0 7.9 7.6 12.1 - SpareBank 1 Gruppen Finans Group 3.8 7.5 6.8 12.2 18.0 22.0 27.9 - Correction Group 1.0 -9.0 0.0 16.4 -8.0 30.6 28.6 Net result before tax from subsidiaries 274.9 166.6 223.8 -26.1 665.3 347.0 535.1 Total operating costs (parent company) 2.9 * -26.1 -33.5 -16.0 -56.6 -59.2 -88.6 Net investment charges (parent company) -21.6 -17.7 -16.8 -18.0 -56.1 -40.1 -59.3 Share of associated company 0.0 0.0 0.0 0.0 0.0 0.0 0.2 Pre-tax result 256.2 122.9 173.5 -60.1 552.6 247.7 387.3 Taxes -28.5 -59.5 26.4 55.8 -61.6 -2.8 138.5 Net result for the period 227.7 227 7 63.4 63 4 199.9 199 9 -4.3 43 491.0 491 0 244.8 244 8 525.8 525 8 Majority interest 228.8 64.2 200.7 -3.1 493.7 247.3 529.8 Minority interest -1.1 -0.8 -0.8 -1.1 -2.7 -2.4 -4.0 Year to date Year Key figures 2012 2011 2011 Annualised return on equity 12.7 % 7.0 % 11.1 %* The project related to the creation of a card company was transferred from SpareBank 1 Gruppen AS to SpareBank 1 Kredittkort AS as at 30 September 2012. This entailed a cost reimbursement of MNOK 46 in the parent company in September, which resulted in net revenue recognition of MNOK 2.9 in Q325
  26. 26. SpareBank 1 Gruppen Quarterly results Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1Figures in MNOK 2012 2012 2012 2011 2011 2011 2011 2010 2010 2010 2010Part of result from subsidiaries before tax - SpareBank 1 Livsforsikring 144.6 141.8 94.1 98.1 77.7 109.0 129.4 72.5 85.8 100.3 91.9 - SpareBank 1 Skadeforsikring Group 185.0 70.4 165.5 167.6 -88.8 56.2 50.3 307.5 253.9 43.4 36.3 - ODIN Forvaltning 1.9 -1.5 -0.5 -8.5 6.3 12.2 11.9 16.5 17.0 16.7 14.4 - SpareBank 1 Markets -64.2 -44.9 -44.8 -77.5 -51.8 -22.1 -3.4 -24.0 -29.0 -1.9 -2.7 - SpareBank 1 Medlemskort p 2.8 2.4 2.8 4.5 2.0 2.5 3.1 1.9 2.7 3.3 3.4 - SpareBank 1 Gruppen Finans Group 3.8 7.5 6.8 5.9 12.2 3.0 6.8 6.6 -4.9 7.0 -0.1 - Correction Group 1.0 -9.0 0.0 -1.9 16.4 15.1 -0.9 -6.3 -7.4 16.3 15.1Net result before tax from subsidiaries 274.9 166.6 223.8 188.1 - 26.1 175.9 197.1 374.6 318.1 185.1 158.2Total operating costs (parent company) 2.9 -26.1 -33.5 -29.4 -16.0 -15.6 -27.7 -16.5 40.7 -11.9 -20.0Net investment charges (parent company) -21.6 -17.7 -16.8 -19.2 -18.0 -15.0 -7.1 -15.6 -11.4 -9.3 -6.9Share of associated company 0.0 0.0 0.0 0.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0Pre-Pre tax result 256.2 256 2 122.9 122 9 173.5 173 5 139.6 139 6 - 60 1 60.1 145.4 145 4 162.4 162 4 342.5 342 5 347.4 347 4 163.9 163 9 131.3 131 3Taxes -28.5 -59.5 26.4 141.4 55.8 -48.1 -10.5 -18.5 -88.4 -8.3 -38.5Net result for the period 227.7 63.4 199.9 281.0 - 4.3 97.2 151.9 324.0 259.1 155.6 92.8Majority interest 228.8 64.2 200.7 282.6 -3.1 98.0 152.4 327.9 263.9 155.9 93.3Minority interest -1.1 -0.8 -0.8 -1.6 -1.1 -0.8 -0.5 -3.9 -4.8 -0.3 -0.526
  27. 27. SpareBank 1 Livsforsikring Results year to date 2012 Q3 Q2 Q1 Q3 Year to date Year Figures in MNOK 2012 2012 2012 2011 2012 2011 2011 Insurance risk income 380.6 380 6 369.1 369 1 361.2 361 2 321.6 321 6 1 110 9 110.9 990.4 990 4 1 338 7 338.7 Insurance risk claims -291.5 -266.2 -340.4 -249.9 -898.1 -758.1 -1 061.7 Risk result 89.2 102.9 20.7 71.7 212.8 232.3 277.0 Tecnical allocations -9.5 -10.3 8.7 -8.2 -11.0 -29.3 -35.6 Risk result after tecnical allocations 79.7 92.6 29.4 63.5 201.8 203.0 241.4 Fees 192.3 180.9 184.8 168.3 558.0 511.9 708.6 Expenses, exclusive comissions -130.6 -137.4 -128.6 -128.0 -396.5 -396.3 -527.2 Comissions -64.8 -62.5 -63.7 -60.1 -191.0 -178.3 -247.3 Administration result -3.1 -19.0 -7.5 -19.8 -29.5 -62.7 -65.9 Net investment income 218.8 153.1 188.6 151.0 560.5 677.4 791.1 Guaranteed interest to policyholders -121.5 -106.1 -115.4 -99.4 -343.0 -311.9 -422.6 Investment result I t t lt 97.3 97 3 47.0 47 0 73.2 73 2 51.6 51 6 217.5 217 5 365.4 365 4 368.5 368 5 Reserves -32.2 -10.3 -31.3 0.0 -73.9 -33.0 -187.3 Investment result after reserves 65.0 36.7 41.9 51.6 143.6 332.4 181.2 Compensation guaranteed interest 6.7 6.1 6.3 5.7 19.1 17.0 22.6 Result before additional provisions 148.4 116.6 70.1 101.0 335.0 489.6 379.4 Undistributed profits to customers -53 3 53.3 -27 7 27.7 -15 2 15.2 -44 7 44.7 -96 3 96.3 -223 6 223.6 -61 5 61.5 Return on companys assets 49.6 52.9 39.2 21.4 141.7 50.0 96.2 Net profit to owner before tax 144.6 141.8 94.1 77.7 380.4 316.1 414.1 Taxes -15.9 -52.6 31.7 36.9 -36.8 2.1 97.8 Net profit/loss for the period 128.7 89.1 125.8 114.6 343.6 318.2 511.9 Key figures Year to date Year 2012 2011 2011 Capital adequacy ratio 19.0 % 18.5 % 18.5 % Buffer capital in % of insurance provisions 16.3 % 14.1 % 11.0 % Buffer capital for the year 2011 is shown after profits have been allocated27
  28. 28. SpareBank 1 Livsforsikring Profit per portfolio year to date 2012 Previously P i l Group established Investment choice Company Figures in MNOK portfolio individual products portfolio portfolio Total Risk result 200.3 -7.7 9.2 0.0 201.8 Administration result 57.0 -31.4 -55.0 0.0 -29.5 Net investment result 144.1 144 1 68.5 68 5 3.1 31 1.9 19 217.5 217 5 Reserves - long life -73.9 0.0 0.0 0.0 -73.9 Compensation interest guarantee 19.1 0.0 0.0 0.0 19.1 Transferred to policyholders -52.6 -32.5 -11.2 0.0 -96.3 Return on companys assets 0.0 0.0 0.0 141.7 141.7 Sum 294.0 294 0 -3.1 31 -54.0 54 0 143.5 143 5 380.4 380 428
  29. 29. SpareBank 1 Livsforsikring Premium income trend year to date 2012 Q3 Q2 Q1 Q3 Year to date Year Figures in MNOK 2012 2012 2012 2011 2012 2011 2011 Individual annuity and pension insurance 79.6 72.3 72.3 68.7 224.3 212.8 284.9 Individual endowment insurance 154.1 150.2 147.9 143.3 452.2 422.9 570.6 Group pension insurance 95.3 74.4 244.3 73.3 414.0 371.1 465.6 Individual life insurance 56.7 55.1 53.8 50.0 165.6 147.0 199.0 Group life insurance 136.2 132.2 239.1 130.5 507.5 479.5 604.4 Unit Linked - Annuity 8.2 8.5 9.3 8.3 26.1 28.4 39.0 Unit Linked - Endowment 31.6 35.2 36.7 38.4 103.5 136.6 181.1 Defined contribution pension 280.3 273.1 265.1 256.6 818.5 728.4 980.7 Total gross due premium income 842.0 801.1 1 068.5 769.0 2 711.6 2 526.8 3 325.5 Premium reserves transferred from other companies 116.8 194.7 102.4 189.1 413.8 444.6 660.8 Reinsurance ceded R i d d -42.4 42 4 -41.2 41 2 -28.6 28 6 -42.9 42 9 -112.1 112 1 -123.9 123 9 -160.4 160 4 Premium income for own account 916.4 954.5 1 142.3 915.2 3 013.2 2 847.4 3 825.929
  30. 30. SpareBank 1 Livsforsikring Return on customer portfolio with guarantee as at 30/09/2012 Value adjusted Value-adjusted return excluding change in value construction: Booked return: Q2 Q3 Q2 Q3 Q2 Q3 Q2 Q3 Q2 Q3 Q2 Q3 Q2 Q3 Q2 Q3 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 2012 6.0 3.6 36 PercentPercent 3.5 2.8 2.6 2.8 2.4 2.2 2.2 1.8 N/A N/A N/A N/A N/A N/A SpareBank 1 Storebrand DNB Livsforsikring Nordea SpareBank 1 Storebrand DNB Livsforsikring Nordea 30 Source: company presentations
  31. 31. SpareBank 1 LivsforsikringReturn on ordinary customer portfolio with guarantee as at y p g30/09/2012 Percent Norwegian shares 16.9 Foreign shares 13.5 Money market 3.0 Norwegian bonds 6.6 Foreign b d i bonds 8.3 Held to maturity 3.8 Real estate 5.431
  32. 32. SpareBank 1 Livsforsikring Balance sheet as of 30/09/2012 Year to date Year Figures in MNOK i i 2012 2011 2011 Intangible assets 138 93 107 Investments 3 109 2 558 2 881 Reinsurances part of insurance obligations 206 222 223 Accounts receivable 75 182 225 Other assets 170 431 368 Prepayed liabilities and accrued income 0 0 0 Investments group portfolio 16 798 15 709 15 909 Investments options portfolio 7 914 6 498 6 896 Total assets 28 412 25 693 26 607 Paid in capital 2 073 1 825 1 825 Other equity 772 632 435 Subordinated loan capital p 200 200 200 Insurance obligations - contractual 16 723 15 453 15 812 Insurance obligations - investment options 8 024 6 583 6 993 Provisions for obligations 70 214 88 Premium deposits from reinsurance companies 139 138 139 Other obligations 337 549 1 043 Accrued liabilities, prepaied income 74 99 73 Total liabilities and equity 28 412 25 693 26 60732
  33. 33. SpareBank 1 Livsforsikring The Government budget proposal to ”Limit the tax exemption model for shares etc. owned by life insurance companies” With the exception of certain amendments, it is largely identical to the discussion document Proposal Consequences • The Ministry of Finance proposes that the tax • The Group may see an increase in taxes in exemption model should not apply to shares etc. p pp y years with good returns and a reduction in in life insurance companies that form part of the taxes in years with negative returns in the group and investment choice portfolios as of stock market 01.01.2012 • The company tax ahead will approach • Revenues from such shares will be taxed as a normal rate of 28 % ordinary income. The share revenue will continue to form part of the deduction for insurance fund • The proposal does not include transition provisions rules related to the tax opening value. Historical cost price will lead to a one- • The tax exemption model will continue to apply off cost in the range of MNOK 175-200 to shares that form part of the company portfolio when calculating the latent deferred tax* • Standard deduction for the companys portion of the returns from paid-up policies, old individual • The tax effect will, in such case, be life insurance contracts and products without recognised in the accounts in Q4 rights to profits * Large degree of uncertainty associated with the estimate because details of the new regulations are not known33
  34. 34. Asset allocation per portfolio as at 30/09/2012 (31/12/11): SB1 Skadeforsikring gSB1 Li sfo sik ing Livsforsikring Group Investment choice Group portfolio Company portfolio portfolio 12.9 (13.8) 12 9 (13 8) % 2.3 (-4.5) 2 3 ( 4 5) % 8.1 (7.9) % 10.1 (10.4) % 38.9 (37.4) % 0.0 (-0.2) % 18.6 (18.8) % 11.2 (12.7) %46.3 (45.9) % 53.2 (54.2) % 20.0 (21.0) % ( ) 63.1 (60.9) % 28.2 (28.0) 28 2 (28 0) % 15.9 (24.8) 15 9 (24 8) % 70.6 (69.0) % 0.6 (-0.1) % Stocks Stocks Stocks Other Other Other Real estate Real estate Real estate Stocks Other Bonds Bonds - amortized cost Bonds - amortized cost Bonds - amortized cost Bonds - market value Bonds - market value Bonds - market value NOK 7.9 (6.9) billion NOK 16.6 (15.7) billion NOK 3.1 (2.9) billion NOK 10.8 (9.6) billion34
  35. 35. SpareBank 1 Skadeforsikring Group Results year to date 2012 Q3 Q2 Q1 Q3 Year to date Year Figures in MNOK 2012 2012 2012 2011 2012 2011 2011 Gross written premium 1 172.6 1 431.1 1 713.1 1 142.9 4 316.8 4 076.8 5 358.2 Net earned premium 1 287.9 1 257.3 1 234.5 1 230.6 3 779.7 3 469.1 4 695.9 Net incurred claims -996.8 -931.7 -992.3 -1 042.8 -2 920.8 -2 867.3 -3 784.0 Net insurance operating costs -311.0 -281.0 -262.4 -259.2 -854.4 -755.5 -1 074.2 Other insurance income/costs 11.3 1.7 1.2 17.6 14.2 30.3 31.8 Changes in other technical reserves 33.5 -15.1 -0.5 53.8 17.9 101.6 93.2 Operating result before finance 24.9 31.1 -19.5 0.0 36.5 -21.7 -37.3 Net financial income 172.8 51.0 194.0 -62.3 417.8 99.5 260.3 Result b f R lt before changes in security reserve h i it 197.7 197 7 82.1 82 1 174.5 174 5 -62.3 62 3 454.3 454 3 77.8 77 8 223.0 223 0 Changes in security reserve -12.7 -11.7 -9.0 -27.0 -33.4 -60.5 -37.7 Pre-tax profit 185.0 70.4 165.5 -89.3 421.0 17.2 185.3 Taxes -42.4 -28.2 -26.0 7.6 -96.7 -17.3 -94.6 Net profit/loss for the period 142.6 42.2 139.5 -81.7 324.3 -0.1 90.7 Key figures Q3 Q2 Q1 Q3 Year to date Year Figures in percentage 2012 2012 2012 2011 2012 2011 2011 Claims ratio, net 77.4 % 74.1 % 80.4 % 84.7 % 77.3 % 82.7 % 80.6 % Cost ratio, net , 24.2 % 22.3 % 21.3 % 21.1 % 22.6 % 21.8 % 22.9 % Combined ratio, net 101.5 % 96.5 % 101.6 % 105.8 % 99.9 % 104.4 % 103.5 % Capital adequacy ratio 34.6 % 27.6 % 32.8 %35
  36. 36. ODIN Forvaltning Results year t d t 2012 R lt to date Q3 Q2 Q1 Q3 Year to date Year Figures in MNOK 2012 2012 2012 2011 2012 2011 2011 Management fees M tf 64.0 64 0 63.4 63 4 67.2 67 2 69.4 69 4 194.6 194 6 241.7 241 7 303.5 303 5 Total operating income 64.0 63.4 67.2 69.4 194.6 241.7 303.5 Salaries -24.8 -25.9 -24.6 -26.4 -75.3 -83.0 -108.5 Depreciations -6.3 -6.8 -6.5 -5.1 -19.6 -13.4 -23.5 Other operating costs -31.2 -32.5 -36.9 -32.5 -100.6 -116.3 -151.1 Total operating costs -62.3 -65.2 -68.0 -64.0 -195.5 -212.7 -283.1 Operating profit 1.7 -1.8 -0.8 5.4 -0.9 29.0 20.3 Net financial income 0.2 0.4 0.3 0.9 0.9 1.4 1.5 Pre-tax profit 1.9 -1.5 -0.5 6.3 0.0 30.4 21.8 Taxes -0.5 0.5 0.2 -2.0 0.2 -8.6 -7.1 Net profit/loss for the period 1.4 -1.0 -0.3 4.3 0.1 21.8 14.836

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