Aktia Bank PLC Class A · OMXHEX:AKTIA
Aktia Bank PLC Class A — Debt Investor Presentation (May 2024)
41 slides from Aktia Bank PLC Class A's debt investor presentation, May 14, 2024
Slide 1: Debt Investor Presentation 14 May 2024
Slide 2: Highlights Q1 2024
Aktia Highlights Q1 2024 Debt Investor Presentation * — Aktia's strong performance continued in Q1. ee Eee : == = * Good comparable operating profit, driven by a high net interest income. ¢ Important key metrics such as C/I ratio and ROE improved. ¢ Assets under management increased slightly and net
Slide 3: Total operating income 10% above last year
Aktia Debt Investor Presentation 13 May 2024 3 Total operating income 10% above last year * Top line growth driven by NII and strong Comparable operating income, Q-o-Q income from life insurance in Q1. EUR million * — Interest income from lending has been 98 supported by favorable margin development
Slide 4: Composition of the Group net interest income
Aktia Debt Investor Presentation 18 May 2024 Composition of the Group net interest income EUR million 389 39.1 10 395 90 33.8 70 318 50 = Lending Liquidity portfolio 30 33 = Other (mainly deposits in Bank of Finland) 49 58 [ 7 65 | Borrowing (incl. Deposits & covered bonds) 10 : 80 87 18 Senior fina
Slide 5: Banking
Aktia 13 May, 2024
Slide 6: Banking: strong net interest income, credit portfolio development
Aktia * Strong net interest income, driven by interest income from lending and growth in profitable financial solutions. ¢ Demand for hire purchase and leasing financing remained strong. ¢ Demand for housing loans still low. * Credit losses increased slightly, but remain at a moderate level, thanks
Slide 7: Assets under Management grew slightly
Aktia Debt Investor Presentation Banking Asset Management Life Insurance 13 May 2024 Assets under Management grew slightly * AuM grew slightly in Q1, as market environment remained mainly positive. * Growth was supported by strong net sales in the banking business and in Private Banking. * Total net
Slide 8: Insurance service result remained solid
Aktia Debt Investor Presentation Banking Asset Management Life Insurance 13 May 2024 8 Insurance service result remained solid * — Sales of risk life insurance policies continued Development of the actuarially calculated result Q-o-Q to developed well. . . . EUR million * — Sales of investment-linke
Slide 9: Sustainability
Aktia Debt Investor Presentation
Slide 10: Aktia's sustainability in Q1/2024
Aktia Debt Investor Presentation 13 May 2024 10 Aktia’s sustainability in Q1/2024 Our mission is to build wealth for our customers and society, not only today but also for generations to come. The financial sector can play a major role in the green transition. Q1/2024 highlights New active ownership
Slide 11: Sustainability-driven success for the leading wealth manager bank
Aktia Debt Investor Presentation 13 May 2024 n Sustainability-driven success for the leading wealth manager bank ns age aie Prosperity & Planet People Principles of Governance Share of SFDR Article 8 and 9 classified funds & Siqni Flame Index* 9° 9 SHE Index*** Aktia’s ESG ratings Target: increase t
Slide 12: Financial overview
Financial overview Aktia
Slide 13: Financial summary Q1
Aktia Debt Investor Presentation Financial summary Q1 EUR million Q1/2023 A% Q4/2023 A% Total operating income 3 70.3 10% 75.2 3% Net interest income 391, 318 23% 38.9 0% Net commission income 301 30.3 0% 298 % Net income from life insurance 77 72 T% 60 27% Other income 04 10 59% 05 -7% Total operat
Slide 14: Balance sheet total EUR 12,107 million
Aktia Debt Investor Presentation Balance sheet total EUR 12,107 million Total assets ™ Lending to the public and public-sector entities = Liquidity portfolio Life insurance assets incl. Unit Link ™ Deposits and current account in Bank of Finland Other assets EUR million 14,000 12,037 12,107 12,000 1
Slide 15: Structure of lending and deposits
Aktia Debt Investor Presentation 13 May 2024 6 Structure of lending and deposits Lending Deposits 1% 8% 1% ™ Households ™ Households ™ Corporates Total ™ Corporates ™ Housing associations 4,575 ™ Housing associations (4,564) EUR million ™ Public entities and non- rt cmentans 66% ™ Public entities an
Slide 16: Net commission income mix
Aktia Debt Investor Presentation 13 May 2024 16 Net commission income mix EUR million 35 303 30.4 30.0 298 304 30 14 17 17 19 Other 25 61 61 62 59 ™ Lending 20 4a 35 36 35 Card, payment services and borrowing 6 ™ Asset management and securities 10 brokerage = Mutual funds 5 ° Q1/2023 Q2/2023 Q3/2023
Slide 17: Despite high inflation, operating expenses are well under control
Aktia Debt Investor Presentation 13 May 2024 7 Despite high inflation, operating expenses are well under control Efficiency improvements now visible in personnel expenses and other operating expenses — despite high inflation last year. IT expenses increased by 19% compared to last year, mainly refle
Slide 18: Quality of the credit portfolio remains solid
Aktia Debt Investor Presentation 13 May 2024 Quality of the credit portfolio remains solid Loan book constitutes for the major part of loans to households with residential or real estate securities. The loan-to-value (LTV) ratio remained at a healthy level (42%). Credit loss provisions in Q1 remaine
Slide 19: Outlook 2024
Aktia Debt Investor Presentation Outlook 2024 Aktia's comparable operating profit for 2024 is expected to be higher or somewhat higher than the EUR 108.4 million reported for 2023. The outlook has been prepared based on the following assumptions: ¢ Despite market uncertainty and a probable decline i
Slide 20: Credit ratings
Credit ratings
Slide 21: CET1 ratio 3.7 percentage points above the regulatory requirement
Aktia Debt Investor Presentation 13 May 2024 21 CET1 ratio 3.7 percentage points above the regulatory requirement * CET1 ratio was 11.4%, thus improved 0.1 percentage points from CET 5 Q4/2023 and 0.3 percentage points from Q1/2023. Regulative % % minimum CET1 requirement ratio is currently 7.75%. 1
Slide 22: Regulative requirements updated
Aktia Debt Investor Presentation 13 May 2024 Regulative requirements updated ° Aktia Bank Group's leverage ratio was 4.3% (4Q23 4.2%) © Tier 1 capital EUR 4517 million * Total exposures EUR 10,4656 million ® At the beginning of 2024 the Finnish Financial Stability Authority has updated the MREL requ
Slide 23: Funding activities
Aktia Debt Investor Presentation Funding activities * Through the first quarter of 2024, the market has remained very strong, and issuance of covered bonds in particular has been very active. Also, senior and subordinated debt markets have performed strongly. * During Q1/2023, Aktia completed six se
Slide 24: Sound funding profile
Aktia Debt Investor Presentation Sound funding profile Borrowing from the public and public-sector entities stayed at EUR 4,575 million. The value of bonds issued by Aktia Bank totalled EUR 3,514.2 (4Q/23: 3,457.1) million. Aktia has EMTCN program of EUR 5 billion. All market-based funding is based
Slide 25: Redemption schedule
Aktia Debt Investor Presentation Redemption schedule Remaining TLTRO redemption schedule: * December 2024: EUR 150 million Next public benchmark covered bond issue redeems in March 2026 EUR million 13 May 2024 Maturity profile, 31 March 2024 an. ltt Under month 1-3 months = Covered bonds issued Subo
Slide 26: High-quality liquidity reserve
Aktia Debt Investor Presentation 13 May 2024 26 High-quality liquidy reserve The Liquidity Coverage ratio (LCR) was 187% The unencumbered assets in the : Unencumbered Liquidity reserve, market value liquidity portfolio, which can be used EUR million 31Mar202%4 31 Dec 2023 as a liquidity reserve, inc
Slide 27: Low risk liquidity portfolio
Aktia Debt Investor Presentation 13 May 2024 27 Low risk liquidity portfolio The liquidity portfolio consists Rating distribution 31 March 2024 of high-quality assets that can be used to meet liquidity requirements Finnish . . . municipalities; no in stressed situations. rating, 4.6% Other, no ratin
Slide 28: Aktia Bank as covered bond issuer
Aktia Debt Investor Presentation 13 May 2024 28 Aktia Bank as covered bond issuer Aktia Bank has issued the Covered bonds as mortgage bank under the former legislation (Act on Mortgage Credit Bank Operations, MCBA 688/2010) and under the new Finnish Covered bond legislation came into effect on 8th J
Slide 29: 1Q 2024 Cover pool 1 asset location
1Q 2024 Pool 1 (2023-) Pool 2 (2014-2022) Lappi 0.2% Asset Pool Balance EUR 0,610 bln. (no substitute assets) EUR 1,764 bln. (no substitute assets) No of loans / average loan balance 6,179/ EUR 98,750 26,144/ EUR 67,477 Types of loans First ranking residential mortgages and First ranking residential
Slide 30: Covered bond termsheet (Aaa, Moody's)
Termsheet Issuer Aktia Bank Plc (Aktia Bank, Ticker: AKTIA) Type European Covered Bond (Premium) Format Reg S, bearer, covered Exp. Issue Rating Aaa (Moody’s) Currency / Size EUR 500,000,000 WNG Settlement Date [xx May 2024 (T+5)] Tenor [long 5yr]; Soft bullet Denominations: 100k x100k Coupon Fixed
Slide 31: Finland: Macro and Housing update
Aktia Finland Macro and Hou update ™
Slide 32: Economic sentiment
Aktia Debt Investor Presentation 13 May 2024 32 E timent Manufacturing industry = Construction Services — Outlook near future ~—Current situation — Outlook near future }—Current situation —Outlook near future —Current situation Saldo Saldo Saldo 50 30 20 40 20 10 30 10 0 20 ° -10 3 10 -10 0 \ AS\ 00
Slide 33: Gross domestic product behind trend
Aktia Debt Investor Presentation 13 May 2024 33 Gross domestic product behind trend Finland, quarterly gross domestic product, 2015 prices —GDP —Trend 2015-2019 Billion EUR 63 62,7 62 61 60 59 58 57 57,2 ai Q3 Qi Q3 Qi Q3 ai Q3 Qi Q3 Qi Q3 Qi Q3 Qi Q3 Qi Q3 Qi 2015 2016 2017 2018 2019 2020 2021 2022
Slide 34: Labour market is normalising
Aktia Debt Investor Presentation 13 May 2024 34 Labour market is normalising Job openings, latest observation 03/2024 Number 150000 125000 400000 75000 50000 - | | | il | | | | ll | il i il | | | i | 0 | | | | [ 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 ‘Source: Akti
Slide 35: Inflation pressure is easing
Aktia Debt Investor Presentation 18 May 2024 35 Inflation pressure is easing Finland, annual change in consumer and producer price indecies % 45 1 40 35 30 25 20 Producer price index, left 15 10 Nok TON DOS ° WA/ Mra 4 -10 -15 Consumer price index, right 2 1998 ©2000» 2002S 2004-«=S 2008. «= 2008 3S
Slide 36: Finnish household indebtedness decreasing
Aktia Debt Investor Presentation 13 May 2024 36. Finnish household indebtedness decreasing Finnish households’ indebtedness rate Percent 140 130 125 % 120 110 100 90 80 70 30 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024
Slide 37: Residential construction starts at lows
Aktia Debt Investor Presentation 13 May 2024 37 Residential construction starts at lows Residential construction activity Million m2, 12 month rolling sum 4,25 4,00 3,75 3,50 3,29 3,25 Completed 3,00 2,75 2,50 2,25 2,24 Starts 2,00 1,76 41,75 Permissions 2014 2015 2016 2017 2018 2019 2020 2021 2022
Slide 38: Housing prices bottomed out?
Aktia Debt Investor Presentation 13 May 2024 38 Housing prices bottomed out? Price index of old blocks' of flats Index 2020=100 110.0 107.5 105.0 Capital city region 102.5 Rest of Finland 100.0 97.5 95.0 94.1 93.1 928 92.4 Whole country 90.0 Jan Mar May Jul Sep Nov Jan Mar May Jul Sep Nov Jan Mar Ma
Slide 39: Housing market has been challenging
Aktia Debt Investor Presentation 13 May 2024 39 Housing market has been challenging Annual change in prices of apartment blocks, 2023 Q4 Population projection, updated 9/2021 Percent 8 7 6 5 -4 3 2 4 0 Index 2019=100 One roo has 113 Tampere — Mercator 110,0 Two rooms ee 109 oulu f 1078 407 Tu ee ee
Slide 40: Housing market comparison
Aktia Debt Investor Presentation 13 May 2024 40 Housing market comparison Real House Prices, 170 Germany 160 150 140 130 120 110 100 90 80 [Finland] 2010 2011 -2012_-««-201H_-««-2OTA-«-2ONIS.-2016._-—«-2HIT_—«-2018_-—«2019-—»=«-2020- 2021-2022 ~—«2028-«~202K Sources: Aktia and Macrobond
Slide 41: Building wealth for our customers and society
BOO Building wealth for our customers and society Timo Ruotsalainen, Head of Treasury +358 10 247 7211 [email protected] Aktia