Avarda Bank AB · OMXSTO:AVARDA

Avarda Bank AB — TF Bank — Shareholder Meeting (May 2018)

14 slides from Avarda Bank AB's shareholder meeting presentation, May 2018

  1. Slide 1: TF Bank AGM May 2018

    TF Bank AGM MAY 2018

  2. Slide 2: January – December 2017 in Summary

    JANUARY – DECEMBER 2017 IN SUMMARY ▪ Continued organic loan book growth LOAN BOOK +27 % (3,16) GROWTH OPERATING ▪ Strong operating profit growth PROFIT 1) +21 % (193 MSEK) GROWTH ▪ Cost efficiency C/I RATIO 37 % ▪ Strong capital base TOTAL CAPITAL 16.2 % RATIO 31 Dec 2017 1) Excluding items affectin

  3. Slide 3: Direct to Consumer: Diversified Granulated Portfolio

    DIRECT TO CONSUMER DIVERSIFIED GRANULATED PORTFOLIO Product overview and use of proceeds Loan sizes (average) and customer profile ▪ 81 % of the loan portfolio ▪ Unsecured consumer loans Low-to-middle income ▪ Marketed trough internal channels and external partners SEK 85,000 Employed ▪ Tenor of loa

  4. Slide 4: Sales Finance Drives New Lending and Builds Database

    SALES FINANCE DRIVES NEW LENDING AND BUILDS DATABASE Product overview Key financials ▪ Full check-out solution offered as one- Share of the Amount outstanding Group’s loan portfolio SEK 595 million stop-shop with several payment (31 Dec 2017) methods such as; invoice, instalment payment, credit/debi

  5. Slide 5: Growth and Diversification According to Plan

    GROWTH AND DIVERSIFICATION ACCORDING TO PLAN Norway Loan book SEK 900m (28 %) Change 2017: +70 % Finland Strong growth in both segments Loan book SEK 911m (29 %) Change 2017: +7 % Profitability and steady growth Sweden Loan book SEK 626m (20 %) Change 2017: -6 % Focus on profitability Baltics Loan b

  6. Slide 6: Worth Noting January – December 2017

    WORTH NOTING JANUARY – DECEMBER 2017 ▪ Continued loan book growth in both segments ▪ Acquisition of Intrum Justitia’s shares in Avarda ▪ Full e-commerce check-out solution launched ▪ BB Finans received a banking license and became BB Bank ▪ Deposits launched in Norway and Germany ▪ Branch establishe

  7. Slide 7: Increased Operating Income and High Margins

    INCREASED OPERATING INCOME AND HIGH MARGINS Operating income Operating income margin 600 24% ▪ Operating income 2013-2017: CAGR CAGR 15 % 512 22% +15 % 500 ‒ Strong organic growth 441 20% 17,9% ‒ 2014: Introduction of Sales Finance 388 400 18% (loan book SEK 375 million) 347 ‒ 2015: Acquisition of B

  8. Slide 8: Cost/Income Ratio – Lean and Cost Efficient Organization

    COST/INCOME RATIO – LEAN AND COST EFFICIENT ORGANIZATION Operating expenses Cost/income ratio 200 189 50% ▪ Operating expenses 2013 vs 180 2017: 85 vs 189 (SEK million) 170 48% 47,1% ‒ Increased personnel, IT and sales 160 143 46% costs 140 ‒ 2015-2017: Investments in 44% 120 Avarda SEK million 107

  9. Slide 9: Net Loan Loss Ratio Continues to Decrease

    NET LOAN LOSS RATIO CONTINUES TO DECREASE Net loan losses Net loan loss ratio 140 CAGR 9% ▪ Clean balance sheet policy +7 % 129 8,0% 8% 7,9% ‒ Non Performing Loans are 120 113 112 generally sold on forward flow 108 98 7% basis after approx. 72 days 6,2% 100 6% 5,1% ▪ Net loan losses 2013-2017: CAGR

  10. Slide 10: Stable Growth for Operating Profit

    STABLE GROWTH FOR OPERATING PROFIT 1) Operating profit 1) ▪ Operating profit 1) 2013-2017: CAGR 15 % CAGR 200 193 +15 % ‒ Strong loan book growth 175 ‒ Cost efficient organization 159 150 ‒ Decreasing net loan loss ratio 137 125 127 ▪ Operating profit 1) 2017: +21 % SEK million 110 ‒ Strong loan boo

  11. Slide 11: Diversification of Deposits and Strong Liquidity Position

    DIVERSIFICATION OF DEPOSITS AND STRONG LIQUIDITY POSITION Strong balance sheet and capital position ▪ Cost-efficient funding from diversified 4 500 75 76 Other assets Shares 101 Other liabilities retail deposits 489 Deposits Germany 4 000 ‒ Sweden (SEK 1.7 billion) Liquidity 1 062 Loans to credit in

  12. Slide 12: Capital Ratio vs. Capital Requirement

    CAPITAL RATIO vs. CAPITAL REQUIREMENT 16.2 % ▪ CET1 ratio of 13.2 % and total capital ratio 16.2 % 1) 3,0% T2 12.5 % ▪ Significant headroom to legal requirements 0,9% Pillar 2 2) ‒ CET1 capital requirement: 8.7 % 1,1% Countercyclical buffer Capital conservation ‒ T1 capital requirement: 10.4 % 2,5%

  13. Slide 13: Looking Ahead into 2018

    LOOKING AHEAD INTO 2018 ▪ Avarda scale-up ▪ Continued growth in consumer lending ▪ Expansion into new pockets of the European consumer finance market where good risk adjusted return levels can be sustained over time ▪ Continued fierce competition especially in the Nordics ▪ Increased regulatory burd

  14. Slide 14: Wrap up

    Wrap up ‘TF TFBank 14

TF Bank — Shareholder Meeting (May 2018) on 6ix