Aktia Bank PLC Class A · OMXHEX:AKTIA
Aktia Bank PLC Class A — Debt Investor Presentation (February 2021)
41 slides from Aktia Bank PLC Class A's debt investor presentation, Feb 18, 2021
Slide 1: Q4 Debt investor presentation
18 FEBRUARY 2021 Q4 Debt investor presentation
Slide 2: Aktia's Q4 2020 in brief
Aktia’s Q4 2020 in brief • Stable financial performance continued: the comparable operating profit for the quarter was EUR 19.8 (19.2) million • Assets under management (AuM) were at an all- time high and amounted to EUR 10.4 billion • The good development of net interest income continued, Aktia’s m
Slide 3: Coronavirus pandemic: overall impacts and measures during 2020
Coronavirus pandemic: overall impacts and measures during 2020 • The market drop during the first quarter led to negative value changes in the life insurance company’s investment portfolio and assets under management • However, the financial performance recovered quickly during the second quarter •
Slide 4: Outlook 2021
Outlook 2021 The comparable operating profit for 2021 is expected to be clearly higher than during 2020 provided that the circumstances on the market and in society are stable. • The increase in net interest income is expected to continue owing to a volume increase and reasonable financing expenses.
Slide 5: AuM at an all-time high level
AuM at an all-time high level Asset Management Assets under management excluding custody (AuM) Asset Management EUR million • AuM increased strongly during Q4 due to positive net subscriptions and the increased market prices for risk 12,000 10,447 investments 9,853 9,623 10,000 8,353 9,233 • A distr
Slide 6: Aktia's Morningstar rating exceptionally strong
Aktia’s Morningstar rating exceptionally strong 01/2021 4.3 4.1 3.9 3.7 3.5 3.3 3.1 2.9 2.7 2.5 01 2018 04 2018 07 2018 10 2018 01 2019 04 2019 07 2019 10 2019 01 2020 04 2020 07 2020 10 2020 01 2021 Aktia Competitor 1 Competitor 2 Competitor 3 Competitor 4 Competitor 5 Competitor 6 Competitor 7 Com
Slide 7: Remarkable growth in total loan book continues
Remarkable growth in total loan book continues Total loan book EUR +571 million • Group lending to the public EUR million EUR million and public-sector entities 2,000 7,000 increased by EUR 571 million 7,000 1,800 6,429 to EUR 7,000 (6,429) million. 6,107 5,717 5,839 1,600 6,000 • Aktia’s total new
Slide 8: Aktia's market share in housing loans increased
Aktia’s market share in housing loans increased Banking Business Private customers • Virtual customer work continued during Q4 and the demand for digital services continued to increase • Demand for mortgage loans was stable throughout the year and the digital mortgage loan process with a fast indica
Slide 9: Our strategic priorities
Our strategic priorities 2023 Win in asset management Acquire new customers in growing cities Drive operational efficiency to capitalise on our challenger position Banking & Insurance Aktia Q4 2020 Debt investor presentation 18 February 2021 9
Slide 10: The financial targets 2023
The financial targets 2023 Comparable Return on Comparable Common Equity operating profit Equity (ROE) cost-to-income Tier 1 capital ratio EUR 100 million above 11% ratio under 0.60 (CET1) 1.5–3 percentage points over the regulatory requirement 1–12/2020; 31 December 2020; 1–12/2020; 31 December 202
Slide 11: Corporate responsibility programme
Corporate responsibility programme In 2020, Aktia updated indicators and actions to group’s corporate Aktia’s corporate responsibility programme responsibility programme and action plan for 2021–2023. Aktia reports every six months on the selected indicators of our corporate responsibility programme
Slide 12: Financial overview
Aktia Q4 2020 Debt investor presentation Financial overview Aktia Q4 2020 Debt investor presentation 18 February 2021 12
Slide 13: Balance sheet total increased to EUR 10,573 million
Balance sheet total increased to EUR 10,573 million 31 December 2020 Total assets Total liabilities and equity EUR million EUR million 10,573 10,573 9,697 Deposits from the public 10,000 9,697 10,000 Lending to the public 4,466 Liabilities to central 8,000 and public-sector 8,000 banks and credit 4,
Slide 14: Structure of lending and deposits
Structure of lending and deposits 31 December 2020 (31 December 2019) Lending Deposits Total EUR 7,000 (6,429) million Total EUR 4,466 (4,060) million 0% (1%) 7% (6%) EUR 30 EUR 314 1% (1%) 13% (11%) (34) million (256) million EUR 66 EUR 908 (54) million (738) million 21% (18%) EUR 946 14% (12%) (72
Slide 15: Financial performance recovered quickly
Financial performance recovered quickly Q-o-Q Comparable operating profit Comparable operating income EUR million EUR million 19.8 60 57.0 19.2 55.2 54.8 0.6 20 0.3 1.7 1.6 49.4 1.1 10.2 16.5 50 8.3 39.9 0.5 16.0 10.1 4.7 0.6 0.3 15 40 11.6 Other 10.0 6.2 25.8 25.2 24.2 25.4 Other 30 22.9 10 10.5 Ne
Slide 16: Comparable operating profit and income
Comparable operating profit and income Y-o-Y Comparable operating profit Comparable operating income EUR million EUR million 70 68.2 211.4 5.5 4.7 201.1 200 2.9 60 55.1 30.0 19.9 0.6 50 150 Other 33.6 Other 24.1 40 99.1 97.6 Net income from Asset life insurance 30 Management 100 Net commission Banki
Slide 17: Strong recovery of assets under management continued
Strong recovery of assets under management continued Asset Management, Aktia UI 1–12/2020 Asset Management, domestic 1–12/2020 EUR million EUR million AUM Market Net AUM Market Net AUM AUM Market Net AUM Market Net AUM 12/2019 changes subscriptions 6/2020 changes subscriptions 12/2020 12/2019 change
Slide 18: Strong recovery of assets under management continued
Strong recovery of assets under management continued Banking Business, Retail 1–12/2020 EUR million AUM Market Net AUM Market Net AUM 12/2019 changes subscriptions 6/2020 changes subscriptions 12/2020 Net AUM Market Net AUM Market subscriptions 3/2020 changes subscriptions 9/2020 changes Aktia Q4 20
Slide 19: Growth investments increased staff costs y-o-y
Growth investments increased staff costs y-o-y 1–12/2020 vs 1–12/2019 EUR million Comparable staff costs EUR 2.0 Staff costs: million higher than a year ago Comparable staff costs increased by 3% to EUR 68.8 (66.8) million. Growth investments increased staff costs from last year IT expenses: IT expe
Slide 20: Financial summary Q4 and YTD
Financial summary Q4 and YTD EUR million Q42020 Q42019 , % 1-12/2020 1-12/2019 , % Total operating income 57.0 55.2 3% 201.1 221.4 -9% Net interest income 20.8 19.3 8% 80.7 77.6 4% Net commission income 25.4 25.8 -2% 97.6 99.1 -1% Net income from life insurance 10.2 8.3 24% 19.9 30.0 -34% Other in
Slide 21: The debt investment case
Aktia Q4 2020 Debt investor presentation The debt investment case Credit ratings Moody's: A1 / P-1, stable, Covered Bonds: Aaa S&P: A- / A-2, stable Aktia Q4 2020 Debt investor presentation 18 February 2021 21
Slide 22: CET1 on a solid level above the target range
CET1 on a solid level above the target range Capital Adequacy • At the end of the period, the Bank Group’s Common CET1 Equity Tier 1 (CET1) capital ratio was 14.0%. EUR million % • The maximum proposed 2020 dividend, EUR 0.43 per share, 800 24 has been deducted from the CET1 capital, which affected
Slide 23: Impairments for future expected credit losses
Impairments for future expected credit losses Change in expected credit losses (ECL) 1–12/2020 EUR million Impairment of credits and other • Macroeconomic assumptions have commitments 1–12/2020 EUR -4.0 million been updated in the 4Q, no significant impact • Impairment of credits and other commitmen
Slide 24: Funding activities remained high
Funding activities remained high • During the year 2020 Aktia has been a very active issuer in the senior preferred market. Aktia has completed over 30 transactions under the EMTN program. The total volume is over EUR 800 million with maturities in the range of 2–15 years. • Aktia is considering to
Slide 25: High-quality liquidity reserve
High-quality liquidity reserve The Liquidity Coverage ratio (LCR) was 138%. • The unencumbered assets in the liquidity portfolio, which can Liquidity reserve, market value be used as a liquidity reserve, 31 Dec 31 Dec including cash and balances 2020 2019 with central banks, had a EUR million Cash a
Slide 26: Low risk liquidity portfolio
Low risk liquidity portfolio The liquidity portfolio consists Q4 2020, Total EUR 1,446 million of high-quality assets that can Domestic Municipalities, not rated be used to meet liquidity 9.1% requirements in stressed Baa1-Baa3 9.7% situations. Assets are: A1-A3 7.1% - LCR and ECB eligible covered a
Slide 27: Sound funding profile
Sound funding profile Covered Bond issuance and customer deposits dominate Borrowing from the public and public-sector entities increased to EUR 4,466 (4,060) million. Aktia’s market share of deposits was 3.1 (3.2) % at the end of December. The value of bonds issued by Aktia Bank totalled EUR 2,720
Slide 28: Redemption schedule
Redemption schedule The year 2021 is gentle on redemptions Aktia Q4 2020 Debt investor presentation 18 February 2021 28
Slide 29: Aktia Bank as covered bond issuer
Aktia Bank as covered bond issuer Aktia Bank operates under • The Aktia Bank mortgage loan portfolio is of very high quality: the legislation as mortgage • Prime residential mortgage loans and loans to Housing Companies bank (Act on Mortgage • Collateral located in Finland Credit Bank Operations, •
Slide 30: Cover pools
Cover pools Lappi 4Q 2020 0.1% COVER POOL 2 COVER POOL 1 Pohjois-Pohjanmaa Total asset pool EUR 2,340 million EUR 131 million (No substitute assets) 3% No of loans / 36,769 / EUR 63,774 1,948 / EUR 67,039 average loan balance Kainuu Types of loans First ranking residential First ranking residential
Slide 31: Finland − a strong but very export driven economy
Aktia Q4 2020 Debt investor presentation Finland − a strong but very export driven economy Aktia Q4 2020 Debt investor presentation 18 February 2021 31
Slide 32: The Finnish Economy
The Finnish Economy Key facts about Finland • Member of EU and Euro area • Population: 5.5 million • Area: 338 430 sq. Km • GDP per capita EUR 38,959 (2016) • Credit ratings: Aa1 (stable) / AA+ (stable) / AA+ (stable) Aktia Q4 2020 Debt investor presentation 18 February 2021 32
Slide 33: The Finnish Economy
The Finnish Economy Aktia Q4 2020 Debt investor presentation 18 February 2021 33
Slide 34: Macroeconomic environment
Macroeconomic environment Rebound visible, growth returns Aktia Q4 2020 Debt investor presentation 18 February 2021 34
Slide 35: Finnish housing market
Finnish housing market Solid and stable market, positive development focused on growing cities old apartments Aktia Q4 2020 Debt investor presentation 18 February 2021 35
Slide 36: Contacts and additional information
Contacts and additional information Outi Henriksson Lotta Borgström CFO Director, IR and Communications Tel. +358 10 247 6236 Tel. +358 10 247 6838 [email protected] [email protected] Timo Ruotsalainen Head of Treasury Tel. +358 10 247 7211 [email protected] Debt investor info
Slide 37: The good bank. And a great asset manager.
The good bank. And a great asset manager.
Slide 38: Appendices
Aktia Q4 2020 Debt investor presentation Appendices Aktia Q4 2020 Debt investor presentation 18 February 2021 38
Slide 39: Key figures Q4 2020
Key figures Q4 2020 (Q4 2019) Net interest income +8% EUR 20.8 (19.3) million Net commission income -2% EUR 25.4 (25.8) million Total operating income +3% EUR 57.0 (55.2) million Comparable operating income +3% EUR 57.0 (55.2) million Total operating expenses +3% EUR -36.4 (-35.3) million Comparable
Slide 40: Net interest income mix
Net interest income mix EUR million 30 23.4 22.9 25 21.5 21.8 23.5 3.9 3.6 20.7 0.7 21.0 20.7 20.8 3.5 3.4 19.6 19.3 19.7 20.1 20.0 0.6 3.3 3.3 2.8 2.0 19.4 19.2 0.6 0.6 1.5 20 1.3 1.2 0.8 0.7 0.5 1.7 1.6 4.6 3.8 1.7 1.6 1.5 1.4 1.4 3.4 3.1 2.4 2.2 2.0 1.6 15 10 19.4 19.5 20.6 17.9 17.3 17.4 17.7 18
Slide 41: Net commission income mix
Net commission income mix EUR million ◼ Other ◼ Insurance 30 ◼ Lending ◼ Card, payment services and borrowing 25.8 25.2 25.4 1.3 24.2 ◼ Mutual funds, asset management 25 1.3 1.5 0.6 0.6 22.9 0.3 and securities brokerage 2.2 1.3 2.1 1.3 0.4 2.4 0.1 2.3 20 2.3 6.1 6.0 5.4 5.5 5.6 15 10 15.7 15.2 14.7
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