Morrow Bank AB · OMXSTO:MORROW
Morrow Bank AB — Komplett Bank — Q4 2020 Earnings Presentation
28 slides from Morrow Bank AB's earnings presentation, Feb 11, 2021
Slide 1: Fourth quarter 2020
@ KOMPLETT’bank Fourth quarter 2020
Slide 2: Disclaimer
Disclaimer This Presentation has been produced by Komplett sometimes identified by the words “believes”, expects”, performance or achievements of the company to be information, including projections, estimates, targets Bank ASA (the “Company” or “Komplett Bank”), solely “predicts”, “intends”, “proje
Slide 3: Today’s presenters
Today’s presenters CEO Jan Haglund CFO Henning Fagerbakke 3
Slide 4: Return to growth and stable credit quality in Q4 2020
Return to growth and stable credit quality in Q4 2020 • Increased onboarding of new customers - returned to net loan growth in Q4 Returning to growth • Target 5-10% overall loan growth in 2021 Stable credit • Focus on assisting existing customers to overcome short-term challenges during pandemic qua
Slide 5: Highlights of the quarter
Highlights of the quarter Q4 2020 Growth • Sales continuously ramped up in Q4 2020 NOK million Q4 2020 Q/Q Y/Y • Net loans increase of NOK 20 million (NOK -62 million in Q3 2020), up NOK 240 million Net loans 8,361 0.2% -1.6% adjusted for FX and forward flow effects Total income 254 -5.6% -16.0% Loa
Slide 6: Increase in new sales in Q4 and return to net loan growth
Increase in new sales in Q4 and return to net loan growth Growth in net loans (NOK million) Net loan growth distribution (NOK million) 186 20Q3 20Q4 79 61 6 -18 -3 -25 -82 -125 -120 326 271 Loans Norway Loans Finland Loans Sweden Credit cards Point-of-sales 187 finance 134 59 -62 20 19Q1 19Q2 19Q3 1
Slide 7: Stable development in underlying credit quality
Stable development in underlying credit quality Loans Norway Loans Finland Loans Sweden • Stable default levels in December • Stable default levels in December • Stable default levels in December compared to previous quarter compared to previous quarter compared to previous quarter • Improvement in
Slide 8: Fourth Quarter 2020 Financial review
Fourth Quarter 2020 Financial review 8
Slide 9: Continued growth in customer base; Total income negatively impacted by non-recurring effects
Continued growth in customer base; Total income negatively impacted by non-recurring effects Total income (NOK million) Number of customers (thousands) 324 293 37 278 277 269 303 35 295 295 291 283 286 247 27 30 23 269 230 254 214 24 20 14 156 115 119 119 128 95 84 77 51 52 53 55 56 57 60 62 4 5 6 7
Slide 10: Higher operational expenses driven by changes to accounting practices and loan growth
Higher operational expenses driven by changes to accounting practices and loan growth Operational expenses (NOK million) and cost ratios (%) 140 70% 120 60% • OPEX NOK 99 million in Q4 2020 compared to NOK 91 million AML admin fee in Q3 2020 driven mainly by changes to accounting practices and sales
Slide 11: Stable credit risk performance during the quarter net of adjustments
Stable credit risk performance during the quarter net of adjustments Break-down of Q4 2020 losses on loans • Increase in stage 1 provisions due to higher new sales • Decrease in stage 2 provisions due to better performance as less customers are overdue • Stage 3 is stable compared to previous quarte
Slide 12: Stable loan loss ratio in 2020
Stable loan loss ratio in 2020 Coverage ratios Loan loss ratio (LLR)* (%) 2.6 % 2.5 % 2.5 % 2.5 % 2.1 % 5.6 % 1.6 % 1.8 % 17.5 % 16.2 % 17.1 % 17.4 % 1.8 % 14.6 % 11.7 % 12.2 % 3.9 % 4.0 % 4.0 % 9.3 % 3.7 % 3.8 % 3.8 % 3.8 % 38.4 % 38.3 % 39.1 % 41.6 % 40.7 % 32.7 % 33.3 % 33.6 % 19Q1 19Q2 19Q3 19Q4
Slide 13: Increased profitability in 2020. ROE impacted by high capital adequacy
Increased profitability in 2020. ROE impacted by high capital adequacy Profit after tax (NOK million) Annualised ROE *’ (%) 83 79 80 76 77 73 18.8 % 18.5 % 17.9 % 18.1 % 66 18 63 38 16.1 % 13.6 % 13.9 % 12.7 % 61 78 46 -15 19Q1 19Q2 19Q3 19Q4 20Q1 20Q2 20Q3 20Q4 19Q1 19Q2 * 19Q3 19Q4 * 20Q1 * 20Q2 2
Slide 14: Solid capital position provides capacity for both growth and dividends
Solid capital position provides capacity for both growth and dividends Regulatory capital structure (%) 26.4% 0.7% • CET1 ratio increased to 22.9% (22.2%) in Q4 2020, well above 18.0% target 2.8% which includes a 1.0%-point management buffer 21.5% 20.5% 2.0% • Including the Q4 2020 profit after tax
Slide 15: Outlook and summary
Outlook and summary 15
Slide 16: Komplett Bank’s strategic roadmap; growth opportunities being reviewed
Komplett Bank’s strategic roadmap; growth opportunities being reviewed Point-of- Consumer Credit Deposit sales loans cards accounts Komplett Bank follows a product- finance wise and geographical expansion strategy to ensure: Q1 Q4 Q3 Q1 2014 2015 2017 2014 • Reduced business risk • Economies of scal
Slide 17: Komplett Bank’s long-term financial targets
Komplett Bank’s long-term financial targets Capital adequacy CET1 target of 18.0% Comprised of regulatory CET1 requirement of 17.0% + 1.0% management buffer Return on equity Above 20% return on equity Excess capital not deployed for growth purposes will Dividend Policy be distributed to shareholders
Slide 18: Summary of our priorities for 2021
Summary of our priorities for 2021 • Maintain activity levels and improve customer acquisition processes Growth • Targets 5-10% loan growth in 2021 • Maintain high focus on credit risk and collection performance Credit quality • Continue to improve data and analytics capabilities • Enhance key custo
Slide 19: Q&A
Q&A
Slide 20: Appendix
APPENDIX 20
Slide 21: Covid-19 update: Limited effects on financials and credit quality so far
Covid-19 update: Limited effects on financials and credit quality so far • Safeguarding the health and well-being of our employees and their families remains a priority Safeguarding employees • Focus on assisting existing customers overcome short-term challenges and supporting customers • Continued
Slide 22: A Nordic specialised consumer finance company
A Nordic specialised consumer finance company • Offering flexible consumer financing solutions to customers across the Nordics • ~325,000 customers across four product areas in Norway, Sweden, Finland and Germany • Strategic partnership with Komplett Group, largest e-commerce company in the Nordics
Slide 23: Diversified product portfolio across the Nordics
Diversified product portfolio across the Nordics Total net loans (NOK million) Distribution of net loans end of Q4 2020 10,000 Tusener 8,821 8,496 8,403 9,000 8,361 8,341 8,361 7,903 8,094 8,000 Loans Norway 7% 7,000 9% Loans Finland 6,000 38% Loans Sweden 5,000 17% 4,000 Credit cards 3,000 Point-of
Slide 24: Stable yield on consumer loans and declining funding cost
Stable yield on consumer loans and declining funding cost Yields performing loans * (%) Gradual yield declines due to growth in new markets • Stable yields for loans 30% • Decrease in yield for credit cards due to growth in new markets 25% Funding 20% • Positive trend due to increased diversificatio
Slide 25: Profit and loss
Profit and loss Amounts in NOK million Q4 2020 Q4 2019 2020 2019 Net interest margin* (%) Interest income 266.7 324.4 1,171.9 1,254.2 11.5 % 11.7 % 11.6 % 12.1 % 11.6 % 11.0 % Interest expenses -28.8 -39.2 -144.8 -167.2 10.5 % 9.8 % Net interest income 237.9 285.1 1,027.1 1,087.0 Income commissions
Slide 26: Balance sheet
Balance sheet Amounts in NOK million 31.12.2020 31.12.2019 Liquidity and funding Assets 1013% Loans and deposits with credit institutions 1,204.2 614.7 774% Net loans to customers 8,361.2 8,495.8 716% Certificates and bonds 1,848.0 1,329.8 506% 539% 536% 525% Other intangible assets 154.2 143.3 Defe
Slide 27: Shareholders and Management and Board ownership
Shareholders and Management and Board ownership Top 20 shareholders Management and members of the Board of Directors ownership Shares Shares Share options # Shareholder % Role Name (thousand) (thousand) (thousand) 1 Kistefos AS* 35,747 19.2% Director Legal & HR Wilhelm B. Thomassen 2,018 270 2 Stat
Slide 28: @ KOMPLETT’ bank
@ KOMPLETT’ bank 28