Aktia Bank PLC Class A · OMXHEX:AKTIA
Aktia Bank PLC Class A — Debt Investor Presentation (August 2021)
45 slides from Aktia Bank PLC Class A's debt investor presentation, Aug 5, 2021
Slide 1: Q2 Debt investor presentation
5 AUGUST 2021 Q2 Debt investor presentation
Slide 2: Record-strong second quarter
Record-strong second quarter EUR million 2Q2021 2Q2020 % • The comparable operating profit at an all-time Total operating income 73.3 54.8 34% high Net interest income 27.7 20.1 37% Net commission income 31.7 22.9 39% • Strong increase in all income categories Net income from life insurance 10.5 10
Slide 3: Comparable operating profit 2017–2Q2021
Comparable operating profit 2017–2Q2021 EUR million 80 70 68.2 65.4 59.9 60 55.1 50 Q4 19.8 42.9 40 30 Q2 26.0 Q3 16.0 20 10 Q2 16.5 Q1 16.9 0 Q1 2.8 2017 2018 2019 2020 2021 Aktia Q2 2021 Debt investor presentation 5 August 2021 3
Slide 4: Asset Management
Asset Management • Aktia acquired Taaleri's wealth management business − the transaction was completed on 30 April 2021 • The transaction brought together two strong players completing each other services • Private Banking transferred to the Asset Management business area and reported segment • Stro
Slide 5: Taaleri wealth management included in AuM during Q2
Taaleri wealth management included in AuM during Q2 Assets under management excluding custody (AuM) EUR million 15,582 16,000 14,000 12,000 9,853 10,447 10,379 10,000 8,353 7,628 8,000 6,234 5,597 6,000 4,000 2,000 0 2015 2016 2017 2018 2019 2020 31 Mar 2021 30 Jun 2021 Institutional assets, includi
Slide 6: Taaleri integration proceeding as planned
Taaleri integration proceeding as planned • Taaleri integration has proceeded according to plans and timetable • Focus on income and cost synergy targets. The work in terms of these has progressed well • Organisations unified, a more comprehensive product selection to all customers • The additional
Slide 7: Banking Business
Banking Business • Quarterly sales of mortgages reached all-time high levels • The improved credit process and quicker indicative offer for mortgages have enabled the growth • Expected credit losses remained on a low level • Corporate customer business continued to grow strongly: active acquisition
Slide 8: Growth in total loan book continues
Growth in total loan book continues Total loan book EUR +160 million (+2%) Q-o-Q EUR million Total EUR million 7,400 700 7,299 7,300 600 7,200 7,139 7,100 500 7,000 7,000 400 6,900 300 6,780 6,800 6,694 6,700 200 6,600 100 6,500 0 6,400 Q2/2020 Q3/2020 Q4/2020 Q1/2021 Q2/2021 New lending Total loan
Slide 9: Life Insurance
Life Insurance • Strong market development together with successful new sales of unit-linked products contributed to good result in Life Insurance • The risk life new sales showed steady growth during the second quarter • Preparation for broadening the investment alternatives in the unit-linked insu
Slide 10: Aktia makes determined efforts on CSR
Aktia makes determined efforts on CSR Highlights in 1–6/2021 Clarified responsibilities Solid and • Markus Lindqvist appointed Director, Sustainability reliable Governance • Updated responsible investment policy and implemented first obligations Partner for under the EU Sustainable Finance Disclosur
Slide 11: Aktia's Capital Markets Day
Aktia’s Capital Markets Day Aktia arranges a Capital Markets Day for investors, analysts, bank representatives and media in Helsinki on 8 September 2021. Aktia’s CEO Mikko Ayub, CFO Outi Henriksson and other members of the Group’s Executive Committee will present at the event. Information on registr
Slide 12: Financial overview
Aktia Q2 2021 Debt investor presentation Financial overview Aktia Q2 2021 Debt investor presentation 5 August 2021 12
Slide 13: Structure of lending and deposits
Structure of lending and deposits 30 June 2021 (31 December 2020) Lending Deposits Total EUR 7,299 (7,000) million Total EUR 4,560 (4,466) million 1% (0%) 8% (7%) EUR 54 EUR 350 2% (2%) 13% (13%) (30) million (314) million EUR 68 EUR 934 (66) million (908) million 20% (21%) EUR 888 15% (14%) (946) m
Slide 14: Balance sheet total increased to EUR 11,236 million
Balance sheet total increased to EUR 11,236 million 30 June 2021 Total assets Total liabilities and equity EUR million EUR million 11,236 11,236 10,573 10,573 Deposits from the public 10,000 10,000 4,560 Lending to the public 4,466 Liabilities to central 8,000 and public-sector 8,000 banks and credi
Slide 15: Comparable operating profit and income
Comparable operating profit and income Q-o-Q Comparable operating income Comparable operating profit EUR million EUR million 80 73.3 30 70 3.4 26.0 57.9 10.5 60 57.0 25 54.8 0.6 1.6 1.6 49.4 19.8 6.8 50 39.9 0.5 10.2 9.9 20 10.1 4.7 Other 16.5 0.3 31.7 16.0 16.9 Centralised 40 0.7 2.1 functions and
Slide 16: Comparable operating profit
Comparable operating profit 1–6/2021 vs 1–6/2020 +68% underlying profit growth (without unrealised value changes) EUR million 42.9 Comparable Other net interest Actuarially Other net income Operating Other operating profit income calculated result from investments expenses 1–6/2020 (Net income from
Slide 17: Assets under Management – Net subscriptions and market changes
Assets under Management – Net subscriptions and market changes Asset Management, Aktia UI Q-o-Q Asset Management, domestic Q-o-Q EUR million EUR million AUM Market Net AUM Market Net AUM AUM Market Net AUM Market Transaction Market 6/2020 changes subscriptions 12/2020 changes subscriptions 6/2021 6/
Slide 18: Assets under Management – Net subscriptions and market changes
Assets under Management – Net subscriptions and market changes Banking Business, Retail Q-o-Q EUR million AUM Market Net AUM Market Organisational Market 6/2020 changes subscriptions 12/2020 changes adjustments changes Net AUM Market Net AUM Net AUM subscriptions 9/2020 changes subscriptions 3/2021
Slide 19: Comparable operating expenses
Comparable operating expenses 1–6/2021 vs 1–6/2020 EUR million Staff costs: The comparable staff costs increased by 10% to EUR 38.3 (34.8), which is mainly 84.6 attributable to Taaleri’s wealth management acquisition with approximately 100 new employees. IT expenses: IT expenses increased by 17% to
Slide 20: Impairments for future expected credit losses
Impairments for future expected credit losses Change in expected credit losses (ECL) 1–6/2021 Impairment of credits and other EUR million commitments 1–6/2021 EUR –3.6 million • Impairments on credits and other commitments increased to EUR -3.6 (-3.2) million, of which the change in the allowance fo
Slide 21: The debt investment case
Aktia Q2 2021 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 Q2 2021 Debt investor presentation 5 August 2021 21
Slide 22: CET1 Capital ratio
CET1 ratio close to the upper limit of the target Capital Adequacy • At the end of the period, the Bank Group’s Common Equity Tier CET1 1 (CET1) capital ratio was 10.8% % % • Target range at the end of period 9.2–10.7% 20 • AT1 requirements now covered with AT1 capital 18 16.5 15.9 9 15.6 15.7 15.6
Slide 23: Aktia meets regulative targets
Aktia meets regulative targets Capital requirement % • Minimum CET1 requirement ratio is 7.71 % (2Q21 CET1 10,8%). Pillar 1 req 4.5% • Total minimum capital ratio requirement 11.76% (2Q21 Total capital:15.5%). Pillar 2 CET1 req 0.70% • Aktia Bank Group’s leverage ratio was 3.8% (4Q20 4.6%). Capital
Slide 24: Funding activities
Funding activities • During the Q2 2021 Aktia completed one private placement transaction. During the first half of the year 2021 Aktia Bank has issued 12 senior preferred debts under the EMTN program. The total volume being approximately EUR 195 million with maturities in the range of 3–10 years. •
Slide 25: High-quality liquidity reserve
High-quality liquidity reserve The Liquidity Coverage ratio (LCR) was 161%. • The unencumbered assets in Unencumbered Liquidity reserve, the liquidity portfolio, which can market value be used as a liquidity reserve, including cash and balances 30 Jun 31 Dec with central banks, had a 2021 2020 EUR m
Slide 26: Low risk liquidity portfolio
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 - Senior notes eligible for Central Bank operations - Commercial or Municipalities iss
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 4,560 (4,466) million. Aktia’s market share of deposits was 3.0% (3.1%) at the end of June. The value of bonds issued by Aktia Bank totalled EUR 2,890 (2,7
Slide 28: Redemption schedule
Redemption schedule The year 2021 is gentle on redemptions but growth increases funding volumes Aktia Q2 2021 Debt investor presentation 5 August 2021 28
Slide 29: Aktia Bank as covered bond issuer
Aktia Bank as covered bond issuer Aktia Bank operates under the • The Aktia Bank mortgage loan portfolio is of very high quality: legislation as mortgage bank (Act • Prime residential mortgage loans and loans to Housing Companies on Mortgage Credit Bank • Collateral located in Finland Operations, MC
Slide 30: Cover pools
Cover pools Lappi 2Q 2021 0.1% COVER POOL 2 COVER POOL 1 Pohjois-Pohjanmaa Total asset pool EUR 2,343 million EUR 117 million (No substitute assets) 3% No of loans / 36,176 / EUR 64,779 1,787 / EUR 65,356 average loan balance Kainuu Types of loans First ranking residential First ranking residential
Slide 31: Finland − a strong but very export driven economy
Aktia Q2 2021 Debt investor presentation Finland − a strong but very export driven economy Aktia Q2 2021 Debt investor presentation 5 August 2021 31
Slide 32: Finnish economy proved resilient during pandemic
Finnish economy proved resilient during pandemic Aktia Q2 2021 Debt investor presentation 5 August 2021 32
Slide 33: Bankruptcy wave did not materialize
Bankruptcy wave did not materialize Aktia Q2 2021 Debt investor presentation 5 August 2021 33
Slide 34: Order intake give a positive short term view
Order intake give a positive short term view Aktia Q2 2021 Debt investor presentation 5 August 2021 34
Slide 35: Employment improving
Employment improving Aktia Q2 2021 Debt investor presentation 5 August 2021 35
Slide 36: Residential construction activity is turning
Residential construction activity is turning Aktia Q2 2021 Debt investor presentation 5 August 2021 36
Slide 37: Finnish housing market
Finnish housing market Solid and stable market, positive development focused on growing cities Prices of old apartments Aktia Q2 2021 Debt investor presentation 5 August 2021 37
Slide 38: 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 39: The good bank. And a great asset manager.
The good bank. And a great asset manager.
Slide 40: Appendices
Aktia Q2 2021 Debt investor presentation Appendices Aktia Q2 2021 Debt investor presentation 5 August 2021 40
Slide 41: Financial summary Q2 and YTD
Financial summary Q2 and YTD EUR million 2Q2021 2Q2020 % 1-6/2021 1-6/2020 , % Total operating income 73.3 54.8 34% 131.2 94.7 39% Net interest income 27.7 20.1 37% 49.0 39.8 23% Net commission income 31.7 22.9 39% 56.8 48.1 18% Net income from life insurance 10.5 10.1 4% 20.4 4.9 315% Other incom
Slide 42: 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 1–6/2021; 30 June 2021; 1–6/2021; 30 June 2021; EUR 42.
Slide 43: 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 Q2 2021 Debt investor presentation 5 August 2021 43
Slide 44: Net interest income mix
Net interest income mix EUR million 30 27.7 23.4 22.9 3.8 25 21.5 21.8 23.5 3.9 3.6 20.7 0.7 21.0 20.7 20.8 21.3 0.5 3.5 3.4 19.6 19.3 19.7 20.1 20.0 0.6 0.5 1.4 3.3 3.3 2.8 2.0 19.4 19.2 0.6 0.6 1.5 1.4 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 20.6 20.7
Slide 45: Net commission income mix
Net commission income mix EUR million ◼ Other 35 ◼ Insurance 31.7 ◼ Lending 1.4 ◼ Card, payment services and borrowing 30 0.5 2.7 ◼ Mutual funds, asset management 25.4 25.0 and securities brokerage 25 24.2 22.9 1.5 1.3 5.5 1.3 0.3 0.3 1.3 0.4 2.4 2.2 0.1 2.3 20 2.3 5.4 5.4 5.5 5.6 15 21.6 10 14.7 15
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