Sampo Oyj · OMXHEX:SAMPO
Sampo Oyj — Debt Investor Presentation (February 2019)
51 slides from Sampo Oyj's debt investor presentation, February 2019
Slide 1: Debt Investor Presentation January–December 2018
Debt Investor Presentation JANUARY – DECEMBER 2018
Slide 2: Debt Investor Contacts and Financial Calendar 2019
DEBT INVESTOR CONTACTS FINANCIAL CALENDAR 2019 Teemu Seikkula, Head of Group Control 07/02/2019 Financial Statement Release for 2018 tel. +358 10 516 0085 Silent period 08/01/2019-07/02/2019 [email protected] Week 10 Financial Statements and Board of Directors’ Report 2018 Knut Arne Alsaker, C
Slide 3: Sampo Group Subsidiaries and Associated companies
Sampo Group 3-16 Subsidiaries and Associated companies If P&C 17-22 Topdanmark 23-27 Mandatum Life 28-32 Nordea Bank 33-34 Sampo plc 35-41 Appendix 42-50
Slide 4: Value Creation in the Nordic Financials as Group Strategy
Sampo Group ― Nordic Financial Group with Strong Brands Value Creation in the Nordic Financials as Group Strategy LONG-TERM • Value creation through investments in Nordic financials based on knowledge of VALUE Nordic markets, Nordic financial institutions & Nordic people. CREATION • Commitment to th
Slide 5: Sampo Group ‒ Nordic Financial Group with Strong Brands
Sampo Group ― Nordic Financial Group with Strong Brands Sampo Group ‒ Nordic Financial Group with Strong Brands • Long-term investor • Manager of capital structure and liquidity • Pay-out ratio ≥ 50% 100% 46.7% 100% 21.2% 36.2% Subsidiary Subsidiary Subsidiary Associated Company Associated Company N
Slide 6: Efficient and stable operations as basis for value creation
Sampo Group ― Nordic Financial Group with Strong Brands Efficient and stable operations as basis for value creation A Mixed Financial Conglomerate Strong relative performance Market cap February 4th 2019, EURbn 10Y Total Shareholder Return Nordea 32.1 DNB 25.0 Swedbank 22.4 >21% Sampo 22.4 SEB 20.1
Slide 7: If P&C ‒ A Diversified Nordic P&C Insurer
Sampo Group ― Nordic Financial Group with Strong Brands If P&C ‒ A Diversified Nordic P&C Insurer • Diversified and profitable subsidiary Strong & Stable Annual Profit Development, EURm EURm • Provides insurance solutions and services 1,200 in the Nordic and Baltic regions as well as 1,000 to Nordic
Slide 8: Topdanmark – A Danish Non-life and Life Insurer
Sampo Group ― Nordic Financial Group with Strong Brands Topdanmark – A Danish Non-life and Life Insurer • A profitable subsidiary with robust business model • Carries out Danish non-life insurance, Profit before taxes, DKKm DKKm life insurance and pension fund business 700 • Non-life business is div
Slide 9: Mandatum Life ‒ A Finnish Financial Service Company
Sampo Group ― Nordic Financial Group with Strong Brands Mandatum Life ‒ A Finnish Financial Service Company • Provides a comprehensive range of wealth Profit Development, EURm EURm management and health and life risk services 500 in Finland and the Baltics for private and corporate customers 250 Pro
Slide 10: Nordea – A Nordic Banking Group
Sampo Group ― Nordic Financial Group with Strong Brands Nordea – A Nordic Banking Group • The largest financial services group in the Nordic Low Quarterly Result Volatility, EURm EURm region and one of the largest banks in Europe 1,600 • Diversified and stable returns 1,400 Restructuring/ • Global p
Slide 11: Diversified Companies and Diversified Portfolio
Sampo Group ― Nordic Financial Group with Strong Brands Diversified Companies and Diversified Portfolio* 1 0.29 1 0.23 0.85 1 0.34 0.66 0.66 1 P/L CONTRIBUTIONS* LOW VOLATILITY EARNINGS LOW VOLATILITY C/R FOCUS ON U-L & WM LOW VOLATILITY C/R PBT 2010-18 • Geographical diversification • Geographical
Slide 12: Steady Development of Profit before Taxes
Sampo Group ― Nordic Financial Group with Strong Brands Steady Development of Profit before Taxes • If P&C • If P&C • If P&C • If P&C • Mandatum Life • Topdanmark / Associated • Topdanmark • Topdanmark • Nordea / Investment • Mandatum Life • Mandatum Life • Mandatum Life • Nordea / Associated • Nord
Slide 13: Sampo plc ‒ Direct equity investments in Other Financials
Sampo Group ― Nordic Financial Group with Strong Brands Sampo plc ‒ Direct equity investments in Other Financials Company Nordax Nets Saxo Bank Asiakastieto Intrum Business • Swedish consumer • Danish pioneer in • Danish fintech • The Combination of credit online bank digital payments company Asiaka
Slide 14: Investment Allocation
Sampo Group ― Nordic Financial Group with Strong Brands Investment Allocation Total Group (MEUR) 26,524 25,286 25,832 14,000 12,192 12,000 11,459 10,912 10,000 8,000 6,879 6,582 6,263 5,816 5,944 5,602 6,000 4,000 2,440 1,933 1,620 2,000 0 Topdanmark Topdanmark Topdanmark Sampo Sampo Sampo Mandatum
Slide 15: Sampo Group's Own Funds and Solvency According to Conglomerate Rules
Sampo Group ― Nordic Financial Group with Strong Brands Sampo Group’s Own Funds and Solvency According to Conglomerate Rules Dec 31st 2018 Group solvency ratio 147% EURm 12,000 10,000 8,000 59 291 6,000 3,779 10,330 Nordea 4,000 7,017 445 2,000 990 1,452 0 If P&C Mandatum Life Topdanmark Sampo plc's
Slide 16: Sampo Group Solvency by Solvency II Rules
Sampo Group ― Nordic Financial Group with Strong Brands Sampo Group Solvency by Solvency II Rules Dec 31st 2018 Ratio of Eligible Own Funds to Group SCR 140% EURm 12,000 10,000 8,000 6,000 3,840 10,361 4,000 7,412 2,000 3,572 0 Consolidated Group Nordea and Other Group SCR Total Eligible Own SCR* fi
Slide 17: If P&C
If P&C A Pan-Nordic Diversified P&C Insurer
Slide 18: Diversified Client Base
If P&C ― A Pan-Nordic Diversified Nordic P&C Insurer Diversified Client Base 1-12/2018 By Business Area By Country 4% 3% 12% 9% Norway Private 31% Gross Written Premiums Sweden Commercial 21% 4,502 EURm Finland 26% 58% Industrial Baltic Denmark 36% Baltic 1% 3% 3% 5% 2% 2% Norway Private 17% 31% Swe
Slide 19: Disciplined Underwriting and Diversification
If P&C ― A Pan-Nordic Diversified Nordic P&C Insurer Disciplined Underwriting and Diversification If P&C and BA average quarterly CR % vs. Deviation Expense ratio 2017, % Q1/2008-Q4/2018 12 Topdanmark 16.1 10 Finland Denmark If P&C 16.4 CR % Standard deviation Industrial Nordic market excl. If (-16)
Slide 20: Conservative Investment Portfolio
If P&C ― A Pan-Nordic Diversified Nordic P&C Insurer Conservative Investment Portfolio Investment Allocation Mark-to-Market Investment Return, % 8% 7.4% Total 10.9 EURbn 6.1% 6% 5.0% Real Estate 4.1% Private Equity 0.2 % 4% 2.9% 2.6% 0.1 % 1.8% 1.5% Other 0.0 % 2% Equities Money 10% 0% Market 2% Pub
Slide 21: Seasonality in Quarterly Results and CR%
If P&C ― A Pan-Nordic Diversified Nordic P&C Insurer Seasonality in Quarterly Results and CR% EURm 350 300 250 200 Investment result 150 Technical result 100 Operating result 50 0 Q4 Q3 Q2 Q1 Average Quarterly CR%, 2008-2018 88.3 87.9 87.1 90.9 Year 2017 CR% 83.6 84.8 85.7 87.4 Year 2018 CR% 83.5 85
Slide 22: If P&C Solvency December 31st 2018
If P&C ― A Pan-Nordic Diversified Nordic P&C Insurer If P&C Solvency December 31st 2018 Internally assessed Solvency ratio 276% Standard Formula Solvency ratio 196% EURm EURm 4,000 4,000 3,500 3,500 S&P TTC for A rating 2,949 EURm S&P TTC for A rating 2,949 EURm 3,000 3,000 2,500 2,500 109 467 2,000
Slide 23: Topdanmark
Topdanmark A Danish Non-life and Life Insurer
Slide 24: Diversified business model
Topdanmark ― A Danish Non-life and Life Insurer Diversified business model 1-12/2018 Pre-tax profit 1,702 DKKm Premiums earned 19,247 DKKm 3% 13% Non-life insurance Non-life insurance, Personal 26% 38% Life insurance Non-life insurance, SME Parent company Life insurance, regular 21% 84% 15% Life ins
Slide 25: Non-life insurance
Topdanmark ― A Danish Non-life and Life Insurer Non-life insurance Technical result by Business Line 1,499 DKKm Combined Ratio by Business Line, % % Personal SME 100 86.2 85.2 82.3 83.3 87.4 85.0 81.5 84.0 80 16.3 16.7 15.4 16 16.2 15.9 16 16.4 60 44% 40 56% Personal 70 68.5 66.1 67.4 72 69 65.5 67.
Slide 26: Life insurance
Topdanmark ― A Danish Non-life and Life Insurer Life insurance Result by components 228 DKKm Gross Premiums (Regular and Single) 10,111 DKKm DKKm 200 Regular premiums 2,855 DKKm 175 Single premiums 7,257 DKKm 140 150 Individual policies, single 125 3% 228 18% Individual policies, regular 100 20 22%
Slide 27: Topdanmark Solvency Dec 31st 2018
Topdanmark ― A Danish Non-life and Life Insurer Topdanmark Solvency Dec 31st 2018 Standard Model Solvency ratio 163% EURm used in Sampo Group SCR calculations Partial Internal Model Solvency ratio 196% 1,500 as reported by Topdanmark, Net SCR figures EURm 401 1,000 595 1,500 61 358 42 98 500 872 691
Slide 28: Mandatum Life
Mandatum Life A Finnish Financial Services Company
Slide 29: Mandatum Life Business Volumes
Mandatum Life ― A Finnish Financial Services Company Mandatum Life Business Volumes 1-12/2018 Technical Provisions 11,177 EURm 2 With-Profit EURm 105 EURm 65 38 138 23 12,000 Unit-linked Guaranteed interest rates 136 Premiums Written U-L 10,000 976 EURm 1,081 EURm 7,066 6,440 5,858 5,312 6,955 8,000
Slide 30: Investment Portfolio covering With-Profit liabilities
Mandatum Life ― A Finnish Financial Services Company Investment Portfolio covering With-Profit liabilities Investment Allocation Mark-to-Market Investment Return, % 5.6 EURbn 15% 11.1% Other 9.4% Commodities Alternative Trading 10% 6.9% Unlisted 0% Equity 5% Derivatives 7.1% 7.20% 6.50% Biometric 0%
Slide 31: Mandatum Life Profit by Components
Mandatum Life ― A Finnish Financial Services Company Mandatum Life Profit by Components EURm 1-12/2018 1-12/2017 Net investment income -26.7 780.8 ‒ Transferred to expense result -24.4 -26.2 ‒ Return on Unit-linked policies 258.8 -405.0 ‒ Return on With-profit policies* -15.6 -171.4 INVESTMENT RESUL
Slide 32: Mandatum Life Solvency December 31st 2018
Mandatum Life ― A Finnish Financial Services Company Mandatum Life Solvency December 31st 2018 EURm 2,000 SF with transitional measures Solvency ratio 176% 1,800 1,600 1,400 352 252 36 114 1,200 47 248 1,000 * 1,740 800 600 1,169 990 400 200 248 0 * Own Funds without transitional measures 1,348 EURm
Slide 33: Nordea Bank
Nordea Bank The Largest Nordic Financial Services Group
Slide 34: Nordea
Nordea ― The Largest Nordic Financial Services Group Nordea 1-12/2018 Operating profit breakdown, EURm Diversified sources of profit 2018, EURm EURm EURm 10,000 10,000 9,005 600 623 1,088 1,708 4,879 2,993 1,733 5,000 9,005 5,000 3,953 173 2,038 341 945 4,324 3,953 741 3,081 2,903 896 0 0 1,030 Oper
Slide 35: Sampo plc
Sampo plc Parent Company with Capacity to Generate Funds
Slide 36: Simple Cash Flows, low leverage and adequate liquidity
Sampo plc ― Parent Company with Capacity to Generate Funds Simple Cash Flows, low leverage and adequate liquidity Flow of Funds Balance Sheet, EURm Dividends Income Assets 12,073 Liabilities 12,073 • If P&C • Interest on Liquidity • Mandatum Life • Income from other Liquidity 1,447 CPs Issued 124 •
Slide 37: Cash and tradable financial investments Dec 31st 2018
Sampo plc ― Parent Company with Capacity to Generate Funds Cash and tradable financial investments Dec 31st 2018 Market Value, nominal Running Instrument Call Date Million Yield,% Cash EUR 1,447 Investment Assets EUR 770 Sub-Ordinated Loans EUR 488 5.34 ‒ Mandatum Life T1 Perpetual EUR 100 4.31 Annu
Slide 38: Sampo Group ‒ Conservative Leverage
Sampo plc ― Parent Company with Capacity to Generate Funds Sampo Group ― Conservative Leverage EURm 16,000 40% Sampo plc Net debt Net debt/NAV 14,000 35% Group NAV 12,000 Group Equity* 30% 10,000 8,000 25% 6,000 20% 4,000 15% 2,000 10% 0 -2,000 5% -4,000 0% Q1/05 Q1/06 Q1/07 Q1/08 Q1/09 Q1/10 Q1/11
Slide 39: Dividends Received by Payment Year
Sampo plc ― Parent Company with Capacity to Generate Funds Dividends Received by Payment Year EURm 1,800 Topdanmark Nordea 1,600 107 Mandatum Life Extra Dividend 1,400 Mandatum Life If P&C Extra Dividend 551 585 1,200 557 If P&C 1,000 533 125 370 150 ** 800 150 84 293 293 * 150 224 100 125 204 250 1
Slide 40: Reported Profit facilitates Debt Servicing
Sampo plc ― Parent Company with Capacity to Generate Funds Reported Profit facilitates Debt Servicing EURm 2010 2011 2012 2013 2014 2015 2016 2017 2018 * Dividend income* 747 762 773 879 1,069 1,226 1,567 1,453 1,671 Operating profit -8 -10 -17 -20 -18 -14 -17 -14 -8 Net financial result -37 -70 -20
Slide 41: Issued Debt Instruments
Sampo plc ― Parent Company with Capacity to Generate Funds Issued Debt Instruments Instrument & Nominal Coupon Swap Effective Rate Maturity CPs issued 125 EURm Euribor + Margin 0.2500% Average 3M Senior Bond 500 EURm 1.125% --- 1.1640% 24-05-19 Senior Bond 2,000 SEKm Stibor3M + 0.77% Euribor3M + 0.5
Slide 42: Appendix
Appendix Separate Supplementary Information
Slide 43: Sampo Group's Outlook for 2019
Appendix ― Separate Supplementary Information Sampo Group’s Outlook for 2019 • Sampo Group’s business areas are expected to report good operating results for 2019. • However, the mark-to-market results are, particularly in life insurance, highly dependent on capital market developments. The continui
Slide 44: Sampo Group Steering Model and Principles
Appendix ― Separate Supplementary Information Sampo Group Steering Model and Principles • Four separate and independent business areas and Sampo plc an active owner • General Principles of Business activities • Straightforward and transparent legal structure combined with limited intragroup exposure
Slide 45: Calculation Principles of Sampo Group Solvency
Appendix ― Separate Supplementary Information Calculation Principles of Sampo Group Solvency • Group Solvency Capital • Under FICO rules, capital is Group equity with some additional items added or deducted (intangibles, subordinated loans, deferred tax assets, planned dividends etc.) • Under SII ru
Slide 46: Structural changes of Sampo Group to the position as the leading Nordic financial group
Appendix ― Separate Supplementary Information Structural changes of Sampo Group to the position as the leading Nordic financial group 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Mandatum Life Sampo’s ownership Sampo Group’s (If P&C’s) ends dist
Slide 47: If P&C Reinsurance Programmes
Appendix ― Separate Supplementary Information If P&C Reinsurance Programmes If is using reinsurance to ‒ Utilize its own capital base efficiently and reduce cost of capital ‒ Limit large fluctuations of underwriting results ‒ Get access to reinsurers’ competence base If has the following Reinsurance
Slide 48: Nordic P&C Insurance Market
Appendix ― Separate Supplementary Information Nordic P&C Insurance Market Nordic Market Shares, % If P&C and Topdanmark P&C Market Shares by Country, % If + If Finland 22 Topdanmark 21% Other If 33% 16% If Norway 21 Topdanmark 5% If Sweden 18 Tryg 9% If Denmark + 6 17 Topdanmark LF OP 10% 5% If Balt
Slide 49: Life insurance Market
Appendix ― Separate Supplementary Information Life insurance Market Finland ‒ Market Shares, % Mandatum Life and Topdanmark Life Market Shares by Country, % Aktia Other Sp- 3% 4% Henkivakuutus Nordea 4% Fennia 31% Baltics/ 4% 6 Mandatum Life LähiTapiola 11% Danmark/ 9 Topdanmark Life Mandatum OP Lif
Slide 50: Sampo Group ‒ Legal Supervision Structure
Appendix ― Separate Supplementary Information Sampo Group ‒ Legal Supervision Structure 50 Source: FSA Finland, October 2018
Slide 51: Debt Investor Presentation
Debt Investor Presentation JANUARY – DECEMBER 2018 Sampo plc Fabianinkatu 27 00100 Helsinki, Finland Phone: +358 10 516 0100 Business ID: 0142213-3 www.sampo.com @Sampo_plc sampo-plc