Avarda Bank Ab · OMXSTO:AVARDA
Avarda Bank Ab — TF Bank — Q3 2017 Earnings Presentation
24 slides from Avarda Bank Ab's earnings presentation, 2017
Slide 1: 3rd Quarter 2017 Result Presentation
3rd Quarter 2017 RESULT PRESENTATION
Slide 2: January – September 2017 in summary
January – September 2017 in summary LOAN BOOK Continued organic loan book growth GROWTH +19 % OPERATING Strong operating profit growth PROFIT +18 % 1) GROWTH Cost efficiency C/I RATIO 37 % TOTAL CAPITAL Strong capital base 16.7 % RATIO 30 Sept 2017 1) Attributable to the shareholders of the parent c
Slide 3: Worth noting
Worth noting January – September 2017 Continued loan book growth in both segments Avarda signed an agreement with a large Finnish retailer BB Finans received a banking license and became BB Bank Deposits launched in Norway and Germany Branch established in Estonia 3
Slide 4: This is TF Bank
This is TF Bank DIVERSIFIED GEOGRAPHICALLY GRANULATED DIVERSIFIED PORTFOLIO NEW OPPORTUNITIES FLEXIBLE IN SALES FINANCE IT- PLATFORM WITH AVARDA LEAN AND COST CLEAN BALANCE FOCUSED SHEET SALE OF NPL ORGANISATION 4
Slide 5: Long track record of profitable growth
Long track record of profitable growth Long experience and proven business model Strong track record on growth and profitability SEK million 30 years experience from consumer finance Loan portfolio 2,500 500 industry 2,000 400 1,500 300 Highly profitable core markets with proven 1,000 200 model for
Slide 6: Direct to Consumer – Diversified Granulated Portfolio
Direct to Consumer – Diversified Granulated Portfolio Product overview and use of proceeds Loan sizes and customer profile Average size (SEK) 81 % of the loan portfolio (as at 30 Sept ’17) ~25,000 Unsecured consumer loans Marketed trough internal channels and external partners ~85,000 Tenor of loans
Slide 7: Sales Finance – Drives new lending and builds database
Sales Finance – Drives new lending and builds database Product overview Key financials % of total loan portfolio Key facts The Sales Finance segment enables merchants to offer (Q3’17) financing solutions to their customers Amount 558 SEKm 19 % outstanding (30 Sept 2017) TF Bank offers reliable and a
Slide 8: Strong loan book growth
Strong loan book growth TF Bank Group Direct to Consumer segment SEK million SEK million 12M growth +23.3% 2,392 2,296 12M growth 2,950 2,300 2,239 +25.2% 2,076 2,900 2,836 2,000 1,940 2,755 1,700 2,700 1,400 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 2,489 2,500 Sales Finance segment 2,357 SEK million 2,300 650
Slide 9: Summary: growth and diversification according to plan
Summary: growth and diversification according to plan Loan book in SEK million and share of group in % Growth 31 Dec 2016 30 Sep 2017 Comments during 2017 847 878 +4 % Profitability and steady growth 34 % 30 % 663 644 -3 % Focus on profitability 27 % 22 % 530 818 +54 % Strong growth in both segments
Slide 10: Core/growth market Norway
Core/growth market Norway Developments Strong momentum continues (BB Bank) Outstanding balance NOK million Loan portfolio 800 774 672 579 Maintaining growth and credit quality 600 467 407 400 334 277 198 Product development (SF) 200 161 Credit card business growing 0 Higher margin than for loans Q3'
Slide 11: Growth markets Poland and the Baltics
Growth markets Poland and the Baltics Poland The Baltics Outstanding balance Outstanding balance SEK million SEK million 325 330 330 300 300 282 280 270 247 270 249 240 230 240 227 204 210 210 180 164 180 145 150 150 120 120 90 90 60 60 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Cha
Slide 12: Core markets Finland and Sweden
Core markets Finland and Sweden Finland Sweden Outstanding balance Outstanding balance SEK million SEK million 1000 800 900 912 688 847 878 663 662 830 700 640 644 800 600 500 600 400 400 300 200 200 100 0 0 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Q3'16 Q4'16 Q1'17 Q2'17 Q3'17 Increased competition affecting
Slide 13: Loan book growth in Sales Finance Segment
Loan book growth in Sales Finance Segment Sales Finance Segment SEK million SEK million Norway – Credit Cards 9M growth: +35 % including one-off Credit Cards movement in Q1 150 9M growth: + 211 % 113 558 540 100 91 550 516 68 50 35 450 413 0 Q4'16 Q1'17 Q2'17 Q3'17 150 Poland 350 9M growth: + 157 %
Slide 14: Increased operating income and strong margins
Increased operating income and strong margins Operating income Operating income margin Comments SEK million 128 130 30% Operating income Q3 2017 vs. 125 119 114 118 Operating income margin Q3 2016 +14 % 25% Strong momentum in Norway, 100 20.5% 20.2% Baltics and Poland 19.4% 20% 18.8% 18.4% Sweden an
Slide 15: Positive trend for Cost/Income ratio
Positive trend for Cost/Income ratio Operating expenses C/I ratio Comments SEK million 44% Operating expenses Q3 2017 50 47 48 46 46 vs. Q3 2016 +8 % 43 42% 40.0% Loan book growth YoY: 25 % 40 40% Lean and cost efficient 38.8% organization 30 38% 37.2% 37.2% Positive seasonal effect in Q3 (vacation
Slide 16: Net loan loss ratio continues to decrease
Net loan loss ratio continues to decrease Net loan losses Net loan loss ratio Comments SEK million 10% Clean balance sheet policy 40 NPL are generally sold on 9% 35 forward flow basis after 32 33 8% approx. 72 days 30 30 28 Net loan losses Q3 2017 vs. 27 7% Q3 2016 +21 % 25 6% 5.4% 5.1% Growing loan
Slide 17: Continued growth for operating profit
Continued growth for operating profit Operating profit 1) Comments SEK million Quarterly 9 months Operating profit Q3 2017 vs. Q3 2016 +11 % 180 Loan book growth and improving C/I ratio 160 +18 % 147 Net loan losses increased 140 125 Liquidity reserve 35 % of deposits 120 100 Mid-term financial EPS
Slide 18: Strong growth and further diversification of deposits
Strong growth and further diversification of deposits Strong balance sheet and capital position Comments SEK million Balance sheet, 30 September 2017 Cost-efficient funding from 4,244 4,244 retail deposits Other assets 91 99 Other liabilities Shares 41 345 Deposits Germany Sweden (SEK 1.8 billion) L
Slide 19: Capital ratios maintained in Q3
Capital ratios maintained in Q3 Historical and current capital structure1) Comments 17.0 % 16.7 % 3.4% 3.2% T2 CET1 ratio of 13.5 % and total capital ratio 16.7 % Significant headroom to legal requirements CET1 capital requirement: 8.6 % 13.6% CET1 T1 capital requirement: 10.2 % 13.5% Total capital
Slide 20: Outcome financial targets 9 months 2017
Outcome financial targets 9 months 2017 Item Target Outcome Over the medium-term, the Company aims to achieve an Growth 15 % 1) EPS growth of at least 20 percent Over the medium-term, the Company aims to achieve a Efficiency 37.0 % cost-to-income ratio of below 35 percent The Company aims to maintai
Slide 21: Q&A Session
O&A Session “I TFBank
Slide 22: Strong Governance through experienced Board
Strong Governance through experienced Board Board of Directors Mattias Carlsson Charlotta Björnberg-Paul Tone Bjørnov Chairman of the Board since Board member since 2017 Board member since 2015 2015, Board member since Current commitments: Saco Oy, Board Current commitments: Filmparken AS, 2008 memb
Slide 23: TF Bank team
TF Bank team Executive management team Declan Mac Guinness Mikael Meomuttel CEO CFO and Deputy CEO With TF Bank since 2012 With TF Bank since 2009 Previous experience: CEO of Carlson Fonder Previous experience: Financial Controller at AB and Compliance Officer for DNB Asset Consortio Fashion Group A
Slide 24: Contacts Investor Relations
Contacts Investor Relations Mårten Svanberg +46 703 627 005 [email protected] www.tfbankgroup.com 24