Aktia Bank PLC Class A · OMXHEX:AKTIA
Aktia Bank PLC Class A — Debt Investor Presentation (September 2023)
47 slides from Aktia Bank PLC Class A's debt investor presentation, September 2023
Slide 1: Debt Investor Presentation September 2023
Debt Investor Pres _ September 2023
Slide 2: Agenda
Aktia Q2 2023 Debt Investor Presentation - Business areas - Sustainable bank market update 7 Mag a, Sie
Slide 3: Aktia in short
ebt Investor Presentation Q2 2023 Debt Ii Pr i 09/08/23 3 Aktia in short 30 June 2023 (Approx) Business areas EUR 13.8 billion EUR 12.33 billion ; a Customer assets under Balance sheet total Banking 2) Asset a Life management (AuM) Management Insurance 250 000 20 000 1 Finland’s % share of capital i
Slide 4: Aktia has been building wellbeing and wealth since 1825
Aktia Q2 2023 Debt Investor Presentation Aktia has been building wellbeing and a wealthier society since 1825 Strategy lifts up individual wealth management and financing, Aktia launched a new core banking system as the first bank in Finland, The modern Aktia is a result of a merger between eight sa
Slide 5: Aktia dividends support wealth broadly
Aktia 2 2023 Debt Investor Presentation 09/08/23 5 Aktia dividends support wealth broadly ¢ Aktia Bank Plc’s shares are predominantly in the hands of domestic investors. 2288% ~ ¢ The Non-profit institutions are local foundations that invest in the wellbeing of their local communities and academic e
Slide 6: Balance sheet total EUR 12,292 million
ebt Investor Presentation Q2 2023 Debt Ii Pr i 09/08/23 6 Balance sheet total EUR 12,292 million Total assets Total liabilities and equity EUR million EUR million 14,000 14,000 12,412 12,292 12,412 12,292 = Deposits from the public 12000 12,000 and public-sector entities Lending to the public and ™
Slide 7: Financial targets 2025
Aktia Financial targets 2025 Q2 2023 Debt Investor Presentation 09/08/23 Comparable operating profit above EUR 120 million 1-6/2023: EUR 50.1 million 1-12/2022: EUR 124.7 million* on Equity (ROE) above 12% 30 June 2023: 13.6% 31 December 2022: 17.2%* Comparable return Comparable cost-to-income ratio
Slide 8: Q2 2023 Debt Investor Presentation
Aktia 2.2023 Debt Investor Presentation
Slide 9: Banking: Average margin continued to grow
Aktia 2 2023 Debt Investor Presentation Banking Asset Management Life Insurance 09/08/23 9 Banking: Average margin continued to grow . . Development of credit portfolio Q-o-Q * The net interest income of the loan book p p continued its strong growth. EUR million EUR million * The average margin for
Slide 10: AM: Stable development of AuM
Aktia 2 2023 Debt Investor Presentation Banking Asset Management Life Insurance 09/08/23 10 AM: Stable development of AuM . . Assets under Management, excluding custod' * The market environment continued to be 9 9 y unstable. EUR million . . . . 17 000.0 15,794 * The equity market in Finland was slo
Slide 11: Life Insurance business remained solid
Aktia 2 2023 Debt Investor Presentation Banking Asset Management Life Insurance 09/08/23 n Life Insurance business remained solid * Sale of risk life insurance developed Development of the actuarially calculated result Q-o-Q positively. EUR million * — Sale of investment-linked insurances 10.0 94 re
Slide 12: Comparable operating profit improved in Banking and Asset Management
Aktia Q2 2023 Debt Investor Presentation 09/08/23 12 Comparable operating profit improved in Banking Business and in Asset Management Comparable operating profit increased clearly in Banking Business and in Asset Management. Comparable operating profit decreased significantly in Life Insurance due t
Slide 13: Aktia
Q2 2023 Debt Investor Presentation la Akt
Slide 14: Aktia's sustainability in Q2/2023
Aktia Q2 2023 Debt Investor Presentation Aktia’s sustainability in Q2/2023 During the second quarter, Aktia took from ambition to action and invested especially in social issues such as employee experience and the well-being of the personnel. This included e.g. a new HR strategy, updated HR related
Slide 15: Sustainability-driven success for the leading wealth manager bank
Aktia Q2 2023 Debt Investor Presentation 09/08/23 Sustainability-driven success for the leading wealth manager bank Prosperity Share of SFDR Article 8 and 9 classified funds Target: increase the share %-points SFDR Article O@: People Siqni Flame Index* & Target: 80 4 SS Q2/2023 Q2/2022 70 71 eNPS**
Slide 16: Aktia's sustainability program for 2022-2025
Aktia Q2 2023 Debt Investor Presentation 09/08/23 Aktia’s sustainability program for 2022-2025 16 Aktia has set four clear and transparent targets for sustainability Prosperity: Customer Satisfaction, Responsible investments, Responsible lending, Comprehensive understanding of customer needs. Aktia’
Slide 17: Credit ratings
Credit ratings
Slide 18: CET1 ratio 3.2 percentage points above the requirement
Aktia Q2 2023 Debt Investor Presentation 09/08/23 18 CET1 ratio 3.2 percentage points above the requirement * CET1 ratio at 11.0% increased by +0.2 percentage cen x points from Q4/2022. : ° * Risk-weighted assets increased by EUR 72 million 9 from the year-end mainly due to increased corporate lendi
Slide 19: CET1 ratio above the requirement
Aktia 2 2028 Debt Investor Presentation CET1 ratio above the requirement Minimum CET1 requirement ratio is 7.75 % (2Q23 CET1 11.0%). © =Total minimum capital ratio requirement 11.80% (1023 Total capital: 15.0%). ¢ Aktia Bank Group’s leverage ratio was 3.8% (4Q22 3.6%). © Tier 1 capital EUR 410.5 mil
Slide 20: High-quality liquidity reserve
Aktia Q2 2023 Debt Investor Presentation 09/08/23 20 High-quality liquidity reserve The Liquidity Coverage ratio (LCR) was 221%. The unencumbered assets in the Une liquidity portfolio, which can be used as a liquidity reserve, including cash and balances with central banks, had Cash and holdings in
Slide 21: Funding activities
Aktia Q2 2023 Debt Investor Presentation 09/08/23 21 Funding activities ¢ Market sentiment was choppy during the Q2 but towards the end of the period much more constructive than earlier this year. Covered Bond market continued working with very high activity. ¢ Aktia refinanced redeeming a EUR 500 m
Slide 22: Low risk liquidity portfolio
Aktia 2 2028 Debt Investor Presentation 09/08/23 22 Low risk liquidity portfolio The liquidity portfolio consists of high-quality assets that can be used to meet liquidity requirements in stressed situations. Assets are: * LCR and ECB eligible covered and SSA notes * Commercial or Municipalities iss
Slide 23: Sound funding profile
Aktia 2.2023 Debt Investor Presentation 09/08/23 23 Sound funding profile Covered Bond issuance and customer deposits dominate Borrowing from the public and public- sector entities ended up to EUR 4.793 (4Q2022: 5,214) million. Aktia’s market share of deposits was 3.0% (3.1%) at the end of June 2023
Slide 24: Redemption schedule
Aktia 2 2023 Debt Investor Presentation 09/08/23 24 Redemption schedule Funding Maturity Structure 8/4/2023 Senior bond and TLTRO refinancing to be done in 2023.
Slide 25: Aktia Bank as covered bond issuer
Aktia 2 2028 Debt Investor Presentation 09/08/23 25 Aktia Bank as covered bond issuer Aktia Bank has issued the existing Covered bonds under the legislation as mortgage bank (Act on Mortgage Credit Bank Operations, MCBA 688/2010). The covered bonds are issued directly from the bank’s balance sheet.
Slide 26: Covered bond asset pool
Asset Pool Balance EUR 0.634 bln. (no substitute assets) EUR 2.004 bln. (no substitute assets) No of loans / average loan balance 6,367/ EUR 99,652 29,513/ EUR 67,902 First ranking residential mortgages, pledges First ranking residential mortgages and Types of loans of shares in housing companies an
Slide 27: Slide 27
Slide 28: Highlights Q2
Aktia 2 2023 Debt Investor Presentation Highlights Q2 ¢ Net interest income grew by 31% to EUR 33.8 (25.8) million. ¢ Net commission income decreased by 4% to EUR 30.4 (31.6) million. * Net income from life insurance amounted to EUR 5.7 (34.9) million. The recalculated comparative figures for 2022 a
Slide 29: Strong growth in net interest income in Q2
Aktia 2 2028 Debt Investor Presentation * Comparable operating income was EUR 70.0 (93.7) million. * Net interest income developed very positively, supported by rising interest rates and margin development. Strong growth in net interest income in Q2 * Net commission income decreased, mainly due to t
Slide 30: Composition of the Group net interest income
Aktia 2 2023 Debt Investor Presentation 09/08/23 30 Composition of the Group net interest income EUR million 100 33.8 ° 318 60 a 5.8 24.2 33 40 23 ™ Other (mainly deposits in Bank of Finland) oe 7! BB ag 24.0 0.0 mTLTRO loan 20 28, on = Liquidity portfolio ™ Senior financing ° 22 86 m Borrowing (inc
Slide 31: Adoption of IFRS decreased comparable operating profit
09/08/23 31 Aktia 2 2028 Debt Investor Presentation Adoption of IFRS 17 decreased comparable operating profit Comparable operating profit 1-6/2023 vs 1-6/2022 EUR million Unrealised value changes and insurance finance result -2.3 Actuarially Other net 85.3 Net calculated income from : let result inv
Slide 32: Net commission income mix
Aktia 2 2023 Debt Investor Presentation 09/08/23 32 Net commission income mix EUR million 35 30.4 — 11 04 30 25 20 15 10 Q3/2022 Q4/2022 Q1/2023 Q2/2023 Other Insurance Lending Card, payment services and borrowing = Mutual funds, asset management and securities brokerage
Slide 33: Quality of the credit portfolio remains solid
Aktia Q2 2023 Debt Investor Presentation 09/08/23 33 Quality of the credit portfolio remains solid * Loan book constitutes for the Change in expected credit losses (ECL) 1-6/2023 major part of loans to EUR million households and private persons with residential or —i real estate securities. 0s -0.3
Slide 34: Finland Macro and Housing market update
Aktia Finland Macro and Hot update
Slide 35: Inflation gradually lower
Aktia Q2 2023 Debt Investor Presentation 09/08/23 35 Inflation gradually lower Inflation Percent 12,5 10,0 75 6,3 % Finland 5,0 5,3 % Euro area 3,1 % USA 25 0,0 vi W =i -2,5 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 Source: Aktia, Macrobond, Eurostat, U.S. Bureau of Labor
Slide 36: Consumer Prices elevated
Aktia 2 2023 Debt Investor Presentation 09/08/23 36. Consumer Prices elevated Finland, annual change in consumer and producer price indecies % % 45 1 40 35 30 0 9 8 7 25 6 20 Producer price index, left 5 4 3 2 Consumer price index, right 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 20
Slide 37: Service sector is still growing
Aktia 2 2023 Debt Investor Presentation 09/08/23 37 Service sector is still growing Sales volume and industrial production Index 2019=100 110 109 Services 107 105 Industrial production 101 400 Construction 98 Trade 95 90 85 2016 2017 2018 2019 2020 2021 2022 2023 ‘Source: Aktia, Macrobond, Statistic
Slide 38: Service exports are 30% of all exports
Aktia 2 2023 Debt Investor Presentation 09/08/23 38 Service exports are 30% of all exports Telecommunications, computer and information services (ICT) cover 41 per cent of total service exports. Finland, export of goods and services Index 2013 Q1=100 160 150 140 130 120 80 150 Services 110 109 /~ Go
Slide 39: Industrial confidence continues to struggle
Aktia Q2 2023 Debt Investor Presentation 09/08/23 39 Industrial confidence continues to struggle Industrial confidence Percent 30 20 10 -10 Euro area -30 -40 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Source: Aktia, Macrobond, European Co
Slide 40: Labor market is cooling off
Aktia Q2 2023 Debt Investor Presentation 09/08/23 40 Labor market is cooling off Job openings, latest observation 06/2023 Number 150000 125000 100000 0 - | | ial, f | lahais od | | | ! 0 | | | | 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Source: Aktia, Macrobond, Ministry
Slide 41: Residential construction activity decreasing
Aktia Q2 2023 Debt Investor Presentation 09/08/23 41 Residential construction activity decreasing Residential construction activity Million m2, 12 month rolling sum 4,25 4,00 3,80 3,75 Completed 3,50 3,25 3,00 2,99 Starts 2,75 2,50 2,44 Permissions 2,25 2013 2014 2015 2016 2017 2018 2019 2020 2021 2
Slide 42: Finnish housing market price development
Aktia 2.2023 Debt Investor Presentation 09/08/28 42 Finnish housing market price development Annual change in prices of apartment blocks, 2023 Q2 Percent -12 11 -9 8 7 - -5 -4 - -2 -1 0 One room ee Two rooms ee Ss ee ial ee = Whole country = Capital city region = Rest of Finland Source: Aktia, Macro
Slide 43: Have we reached the bottom?
Aktia 2 2028 Debt Investor Presentation 09/08/2343 Have we reached the bottom? Price index of old blocks' of flats Index 2020=100 108 107 106 405 Capital city region 104 103 102 Rest of Finland 101 100 100.3 99 Whole country 98.3 98 97 97.0 96 Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar
Slide 44: Housing market expectations
Aktia Q2 2023 Debt Investor Presentation 09/08/23 44 Housing market expectations Intentions to Buy a Dwelling in the Next 12 Months Percent 19 18 17 16 y 15 14 13 12,4 12 1 10 9 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 20
Slide 45: Housing market prices under pressure
Aktia Q2 2023 Debt Investor Presentation 09/08/23 45 Housing market prices under pressure Real House Prices, 170 Germany 160 150 140 130 120 110 400 90 80 2010-2011 2012 ~—«2013.-—=—«2014 «01S 01S. ~—«OTT-—«2O1B_~«2019-—«2020-~—«2021-~=«2022 +2023 Sources: Aktia and Macrobond
Slide 46: Thank you
BOO Thank you Aktia
Slide 47: Contacts and additional information
Aktia 2.2023 Debt Investor Presentation 09/08/28 «47 Contacts and additional information Outi Henriksson Lotta Borgstr6m Timo Ruotsalainen CFO. Director, IR and Communications Head of Treasury Tel. +358 10 247 6236 Tel. +358 10 247 6838 Tel. +358 10 247 7211 outi.henriksson@aktiafi lotta.borgstrom@a
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