Annika Falkengren, President & CEO of SEB, summarized the bank's annual report for 2012 in the following areas:
1. Business expansion with increased number of clients and credit portfolio in both large corporate and SME segments across Nordics and Germany.
2. Improved customer satisfaction ratings compared to peers for both large corporate and SME segments.
3. Increased operating leverage with higher average quarterly income and lower average quarterly expenses.
4. Strong balance sheet with capital and liquidity ratios exceeding requirements.
Andrew Wiswell, NAL Energy's President and CEO, presents at the CIBC 2012 Whistler Institutional Investor Conference at Whistler, B.C., at 8 a.m. PST (9 a.m. MST, 11 a.m. EST).
Andrew Wiswell, NAL Energy's President and CEO, presents at the CIBC 2012 Whistler Institutional Investor Conference at Whistler, B.C., at 8 a.m. PST (9 a.m. MST, 11 a.m. EST).
At SEB, sustainable development means building a sustainable business as a bank. In the Corporate Sustainability Report 2010 you can read more about what SEB has done and what priorities the bank has for the future. Sustainability is meant to become an integrated part of SEB business, a core competence by 2012. It is a very high ambition.
Svenskarna är mindre nöjda med välfärden jämfört med sina nordiska grannar. Det visar SEB:s nya välfärdsindex som bygger på tolv olika frågor om tilltron till välfärdstjänster och trygghetssystemen.
At SEB, sustainable development means building a sustainable business as a bank. In the Corporate Sustainability Report 2010 you can read more about what SEB has done and what priorities the bank has for the future. Sustainability is meant to become an integrated part of SEB business, a core competence by 2012. It is a very high ambition.
Svenskarna är mindre nöjda med välfärden jämfört med sina nordiska grannar. Det visar SEB:s nya välfärdsindex som bygger på tolv olika frågor om tilltron till välfärdstjänster och trygghetssystemen.
SEB:s Boprisindikator visar att hushållen är mindre positiva till bostadsmark...SEBgroup
Färre än tidigare tror på stigande bostadspriser och fler tror på fallande priser. Det visar SEB:s Boprisindikator för juni, som faller tillbaka jämfört med förra månaden.
SEB sees 25 per cent chance of Riksbank cutSEBgroup
SEB’s experts see a 25 per cent chance the Riksbank will cut its repo rate by 25 basis points to 1.25 per cent at Wednesday’s rate decision. An investor survey done by SEB shows only 8 per cent of respondents foresee a rate cut and in an internal survey among SEB’s own fixed income traders and experts, 18 per cent says they believe the rate will be cut. The alternative to a cut is an unchanged repo rate.
Drygt hälften av hushållen tror på stigande bostadspriser och endast 14 procent av hushållen tror på fallande priser. Hushållen tror att reporäntan ligger på cirka 1,3 procent om ett år och andelen som planerar att binda räntan fortsätter att falla. Det visar SEB:s Boprisindikator, som stiger för fjärde månaden i följd.
Färre hushåll tror på stigande bostadspriser och fler än tidigare tror på fallande priser det kommande året. Det visar SEB:s Boprisindikator för juni. Hushållen tror att reporäntan ligger på en procent om ett år och andelen som planerar att binda räntan är oförändrad sedan förra månaden.
Nysparandet var under kvartalet 49 miljarder kronor, varav 35 miljarder avsåg banksparande. Negativt sparande i fonder uppgick till 24 miljarder.
Kurserna på stockholmsbörsen minskade med 11,0 procent, vilket påverkade förmögenhetsmassan negativt.
Också bostadspriserna gick ner –med 2,4 procent.
Hushållens upplåning ökade på ett år med 9,8 procent.
SEB hade 14,6% av sparmarknaden, Swedbank15,3%, Skandia 10,1%, Alecta9,7% och Nordea 8,9%
SEB Research: IMF leads enlarged rescue package for GreeceSEBgroup
SEb's analysts see a large and credible IMF package as the most likely scenario to resolve the Greek debt issue. This is also what is needed to calm markets. Recent comments from EU officials also rules out debt restructuring for Greece. According to SEB's experts a proposal must be presented within coming days to calm financial and political nervousness.
EU to save banks but abandon state if Greece rejects austeritySEBgroup
The EU will save its banks but abandon the state if Greece rejects austerity in the upcoming vote on 17 June, SEB’s chief strategist Johan Javeus projects in a presentation where he outlines what might lie ahead for the recession-hit country. Recent opinion polls suggest the country will get a pro-austerity government, but the final outcome is far from certain and since Greek law does not allow more polls until the election, Europe will be flying blind for a couple of weeks.
Economic growth has led to lower employment and combined with earnings from abroad and remittances this has added a significant amount of funds to households’ disposable income in all three Baltic countries, SEB’s latest Baltic Household Outlook shows.
SEB-report: EU financial transactions tax unlikely to passSEBgroup
The European Commission will present a proposal for a Tobin tax on financial transactions this autumn. Implementation of this tax is unlikely as both Sweden and the UK oppose it. It would be easier to find support for a stability levy, writes SEB economist Andreas Johnson in a note published Wednesday.
In this edition of Fixed Income Insights, SEB's experts take a closer look at recent developments in the eurozone debt issue and conclude that the political system will continue to ensure a crisis is avoided. Market implications include continued upward pressure in intra-EMU spreads up until the EU summit in June, further macroeconomic concerns, volatility and lower risk appetite. With an acute crisis averted, the experts believe the ECB will continue to raise rates gradually, delivering its next hike in July followed by another in the fall.
The dollar has come under pressure as the Federal Reserve remains on hold for an extended period. SEB’s strategists say in the latest issue of Currency Strategy that it is likely that the dollar continues to remain weak. They do however note that we are closer to see the dollar finding some traction versus other G10 currencies. The bank’s experts forecast a slow grind lower in the euro/Swedish krona echange rate.
The savings stock of Swedes on December 31 2010 amounted to SEK 10,169 billion, an increase by 180 billion during the last quarter. Net savings during the quarter amounted to SEK 49 billion.
SEB-report: Consumption, exports boost eastern European economiesSEBgroup
Eastern European economies will strengthen in 2011 on the back of greater household purchasing power and competitive exports, states SEB's Eastern European Outlook released Wednesday. Overall, economic conditions will strengthen across the region over the next two years, with exports driving growth this year.
SEB's first take on the Japanese earthquakeSEBgroup
SEB’s experts believe effects on financial markets and the economy will be short lived while nuclear problems pose a big risk.
The economists have assembled a chart package on possible economic effects from the Japanese earth quake. Among others they have included charts on growth and financial markets after Kobe quake, hurricane Katrina 2005 and the 9-11 terror attacks 2001. There are also some charts on the Japanese energy sector, implications for oil prices and Japanese holdings of US bonds.
Their main scenario remains that the impact on growth will be limited and that central banks will hike according to plans. They also discuss a risk scenario for growth and central banks if the nuclear damage should deteriorate.
2. Delivery of 2010–2012 plan
1 Business expansion
2 Customer satisfaction
3 Operating leverage
4 Strong balance sheet
2
3. Business expansion
Large Corporate Number of clients Credit portfolio (SEK bn)
Nordics & Germany +300
2,100
+130
2009 2010 2011 2012
SME Number of clients Credit portfolio (SEK bn)
Sweden +31,500
130,000
+60
2009 2010 2011 2012
3
4. Customer satisfaction
Large Corporate
performance
Nordics Peer 4
Overall
Peer 2
Peer 3
Peer 1
Willingness to recommend
SME Swedish Quality Index SEB Avg. Swedish peers
Sweden #2
#4 #3
2010 2011 2012
Private Bank of the Year 2012 Best Nordic Private Bank
Sweden & Baltics Sweden
Estonia
Lithuania
Latvia
4
5. Increased operating leverage
Average quarterly income (SEK bn) Average quarterly expenses (SEK bn)
9.2 9.4 9.8
5.8 5.9 5.7
Avg 2010 Avg 2011 Avg 2012 Avg 2010 Avg 2011 Avg 2012
Operating leverage
Average quarterly profit before credit losses (SEK bn)
4.1
3.4 3.5
Avg 2010 Avg 2011 Avg 2012
Notes: Excluding one-offs (restructuring in 2010, and bond buy-back and IT impairment in 2012)
Estimated IAS 19 costs in 2010
5
6. Strong balance sheet
Capital, liquidity and asset quality
CET1 Basel III 13.1%
LCR 113%
Liquid resources SEK 632bn
Loan to deposit ratio 134%
NPL coverage ratio 66%
Loan losses 8bps
6
7. Underlying business development
Pre-provision profit and operating profit (SEK bn)
Operating profit Pre-provision profit
5
4.3
4
3
2
1
0
Q4-10 Q1-11 Q2-11 Q3-11 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12
Notes: Excluding one-offs (bond buy-back and IT impairment in Q4 2012)
Estimated IAS 19 costs in 2010
7
8. Results presented today exclude one-off effects
announced last week
Results presentation
excludes:
Buy-back of covered bonds
at negative income of SEK 402m
IT impairment at cost of
SEK 753m
9. Income statement
Profit and loss (SEK bn)
Q4-12 % Q3-12 % Q4-11 FY 2011 FY 2012 %
Total Operating income 10,039 +4 +8 37,686 39,225 +4
Total Operating expenses -5,771 +2 -4 -23,513 -22,899 -3
Profit before credit losses 4,268 +6 +29 14,173 16,326 +15
Net credit losses etc. -274 780 -936
Operating profit 3,994 +4 +30 14,953 15,390 +3
Operating income by type, 2011 vs. 2012 (SEK bn)
17.6
13.6
9%
12%
Customer-
15.2 15.9 44%
driven NII 4.6
3.4
35%
2011 2012 2011 2012 2011 2012 2011 2012
Net interest Net fee and Net financial Net life insurance
income commissions income income
Note: Excluding one-offs (bond buy-back and IT impairment)
9
10. Net interest income development
Net interest income Q4 2010 – Q4 2012 (SEK bn)
5.0
4.5
4.0
3.5
3.0
2.5
Q4-10 Q1 Q2 Q3 Q4-11 Q1 Q2 Q3 Q4-12
Net interest income by income type Q4 2010 – Q4 2012 (SEK bn)
3.4
0.6 0.4
Q4-10 Q4-11 Q4-12 Q4-10 Q4-11 Q4-12 Q4-10 Q4-11 Q4-12
Lending Deposits Funding & other
10
11. Net fee and commission income development
Net fee and commissions Q4 2010 – Q4 2012 (SEK bn)
5.0
4.5
4.0
3.5
3.0
2.5
Q4-10 Q1 Q2 Q3 Q4-11 Q1 Q2 Q3 Q4-12
Gross fee and commissions by income type Q4 2010 – Q4 2012 (SEK bn)
2.4
1.8
0.7
Q4-10 Q4-12 Q4-12 Q4-10 Q4-11 Q4-12 Q4-10 Q4-11 Q4-12
Advisory, secondary markets and derivatives Custody and mutual funds Payments, cards, lending, deposits and guarantees
11
12. Net financial income development
Net financial income Q4 2010 – Q4 2012 (SEK bn)
2.5
2.0
1.5
Excl. GIIPS de-risking
1.0
0.5
0.0
Q4-10 Q1 Q2 Q3 Q4-11 Q1 Q2 Q3 Q4-12
Net financial income development (SEK bn)
NFI Divisions
GIIPS 1.2 1.2 1.2 1.1 1.2 1.3 1.1
1.0
NFI Treasury
& Other -0.2
-0.2 -0.2
Q1-11 Q2 Q3 Q4-11 Q1 Q2 Q3 Q4-12
12
13. Delivery on cost-cap for underlying business
Operating expenses excluding one-offs, SEK bn
23.0 23.1
Excl. IAS 19
22.7 <23.0bn
2010 2011 2012
23.3 23.5 New cost cap
<22.5bn
Incl. IAS 19
22.9
2010 2011 2012 2013 2014
Notes: Excluding IT impairment
Estimated IAS 19 costs in 2010
13
14. Divisional performance
Operating profit 2011 vs. 2012 (SEK m)
7.5 Jan-Dec 2011
7.1 Jan-Dec 2012
4.4
3.1
2.9
2.0 2.0
1.4 1.3
1.1
Merchant Banking Retail Banking Wealth Management Life Baltic
Note: Excluding IT impairment
14
18. Uncertain macroeconomic environment persists
Macro improving but
from low level
European crisis making
slow progress
Customer activity
remains subdued
Central banks
keeping rates low
18
19. Financial ambitions
Dividend payout 40%
or above
Common Equity Tier 1 Long-term ROE
ratio of 13% aspiration 15%
Generate ROE that is
competitive with peers
19
20. What is a competitive ROE in the near-term?
ROE 2014 – Consensus analyst estimate (Post Q3 2012, %)
With 13% CET1
ratio
Improved
15 operating leverage
13 13 13
12
11 11
10
Peer 1 Peer 2 Peer 3 SEB Peer 4 Peer 5
Source: Consensus analyst estimates from equity research reports
20
21. Back-of-the-envelope calculation for ROE 13%
Operating profit ILLUSTRATIVE
(SEK bn)
Asset Baltic Approx. 20
Private & Gathering
Corporates
Large Corps &
Institutions
15.4
Target ROE>peers = approx. 13%
Capital generation assuming dividend payout >40%
2012 ”2015”
ROE 11% ROE approx. 13%
Note: Excluding one-offs (bond buy-back, IT impairment and tax effect)
21
22. Merchant Banking
Large Corporates Institutions
Second phase in the Nordic region
Pic Pic Acquisition of new clients
and in Germany
Enhance capital markets Increase cross-selling on existing
Pic
capabilities customer base
Increase customer flows in Greater co-ordination of the
Pic Pic
emerging markets offering and packaging
Impact
Income growth ~15% by 2015
22
23. Retail Banking
Corporates Private
Holistic relationship banking in Advisory driven service based on
focus: “Hela företagaren” customer needs
Strengthen customer growth and Improve customers ability to
local competence travel seamlessly between channels
Invest in self-service and e-banking Invest in e-banking for cost efficient
for service improvements service and offerings
Impact
Income growth ~20% by 2015
23
24. Asset Gathering and Baltic
Asset Gathering Baltic
Reduce complexity in fund offering
Focus on Home Banking customers
and improve performance
Enhance private banking client Standardize product offering and
segmentation and client processes to simplify customer
experience experience
Improve Life insurance online Improve advisory service to SME
solutions and risk products and Corporate Customers
Impact Impact
Income growth ~5% by 2015 Income growth ~15% by 2015
24
25. Conclusion
Deep and broad long-term customer
relationships remain at heart of SEB’s strategy
Profit growth from disciplined execution
of investments and cost control
Strong balance sheet and
low risk profile maintained
New financial targets reflect SEB’s strong
commitment to bring value to shareholders
25