Aktia Bank PLC Class A · OMXHEX:AKTIA
Aktia Bank PLC Class A — Debt Investor Presentation (2018)
29 slides from Aktia Bank PLC Class A's debt investor presentation, 2018
Slide 1: Debt Investor Presentation
Debt Investor Presentation Outi Henriksson, CFO Timo Ruotsalainen, Head of Treasury Interim Report 1Q 2018 1
Slide 2: Aktia Bank Plc Executive Summary
Aktia Bank Plc Executive Summary Retail bank with focus on growth areas in Finland Provides banking services to private customers, small and middle sized companies and institutional investors. Business supported by own branch network and digital services Households accounts for 85 % of the loan port
Slide 3: Aktia overview and recent result
Aktia overview and recent result • Implementation of new strategy. • New core banking system enables improved digital operations and customer service. • Good financial performance in January – March 2018. 3
Slide 4: Background and strategy
Background and strategy Aktia is the oldest deposit bank in Finland. 1826 Helsinki Savings Bank started its business operations. 1991 Today’s Aktia was born when Helsinki Savings Bank merged with seven other savings banks. More mergers followed until the new millennium. 2009 Aktia's shares were list
Slide 5: Aktia in numbers
Aktia in numbers Aktia is a local Finnish bank serving private customers, small and middle sized corporates and institutional investors. Aktia's share (AKTIA) is listed on the list of Nasdaq Helsinki Ltd. Aktia Bank, 2017: Operating income: EUR 210.3 million C/I: 0,7 CET1: 18.0% 350,000 Operating pr
Slide 6: Comparable operating profit +13% in Q1/2018
Comparable operating profit +13% in Q1/2018 EUR million 1-3/2018 1-3/2017 CHANGE 2017 Operating income EUR 51,2 million Net Interest Income 20.7 23.4 -11% 89.6 Other; -0.8 Net Commission Income 23.8 21.1 +13% 91.4 Group functions; 6.5 Total Operating Income 51.2 53.1 -4% 210.3 Total Operating Expens
Slide 7: January–March 2018 in short
January–March 2018 in short Cost savings produce results. Strong net commission income. New services and better economic governance and reporting with the new core banking system. New digital Implementation of solutions our strategy • Automated balance certificates and robotised • New segment report
Slide 8: Core banking system in place and in use
Core banking system in place and in use Digital banking • The new core banking system introduced in summer 2017 Data and analytics • The core banking system enables combined automated processes and robotics in our service solution eg. automated loan decisions. • Versatile Mobile Bank allows eg. fund
Slide 9: Aktia's customer groups according to new strategy
Aktia’s customer groups according to new strategy 70 % of Finnish citizens would prefer Financial Advisory 40% of Aktia’s customers have a personal PRODUCT PREFERENCE PREMIUM PRIVATE BANK OWNER MANAGED financial advisor – the INSTITUTIONS CUSTOMERS CUSTOMERS CUSTOMERS CUSTOMERS ENTERPRISES highest p
Slide 10: Growing Asset Management
Growing Asset Management Awarded Wealth Management ASSETS UNDER AUM, GROWTH IN ASSETS UNDER MANAGEMENT MANAGEMENT (Group) annual growth 8000 10,131 20 % 7500 7000 EUR million 6500 6000 INSTITUTIONAL EMERGING MARKETS CLIENTS AUM SHARE 5500 5000 5,157 2,000 4500 EUR million EUR million 4000 2012 2013
Slide 11: Aktia – the debt investment case
Aktia – the debt investment case Moody’s Standard & Poor’s Senior loan: A3 / P-2, positive outlook Senior loan: A- / A-2, stable outlook Covered bonds: Aaa Complete rating reports on www.aktia.com/en/velkasijoittajat/luottoluokitus 11
Slide 12: Assets and liabilities of Aktia Group
Assets and liabilities of Aktia Group (EUR million) 31 March 2018 31 Dec 2017 (EUR million) 31 March 2018 31 Dec 2017 Assets Liabilities Interest-bearing securities 7,5 - Liabilities to central banks 400,0 400,0 Shares and participations 1) 135,4 - Liabilities to credit institutions 326,6 294,4 Inve
Slide 13: Capital adequacy
Capital adequacy: Capital levels meet requirements and exceeds target Change in CET1: • Aktia’s Common Equity Tier 1 Capital (CET1 %) remains at a CET1 % 31.12.2017 18.0 % good level 16,4% (18%) Mortgage risk weight floor (15%) -1.0 % • Aktia’s CET1 capital decreased General increase of risk weighte
Slide 14: Structure of lending and deposits
Structure of lending and deposits Households are key driver of business Public entities and non-profit Public entities and non-profit Housing organisations organisations associations 1% 3% 9% SMEs SMEs 21 % 11% Lending Deposits EUR 5,893 million EUR 3,933 million (2017: 5,839) (2017: 4,119) Househol
Slide 15: Prudent and low-risk lending policy
Prudent and low-risk lending policy Stable long-term trend in non-performing loans Aktia Bank operates under strict Non-performing loans more than 90 days overdue origination criteria: • Identification of the customer mandatory • Responsible lending: customer ability to pay stress tested • Credit pe
Slide 16: High-quality liquidity portfolio
High-quality liquidity portfolio At the end of March 2018 the Bank Group’s liquidity buffer was approximately equivalent to the estimated outgoing cash flow of finance from the wholesale market for 27 months. The Liquidity Coverage ratio (LCR) was 143%. 31.3.2018 31.3.2017 6% EUR million 1,816 1,816
Slide 17: Sound funding profile
Sound funding profile Customers deposits and covered bonds dominate Debt maturity profile Money EUR million Subordinated debt Market 3% 0% 800 REPOs & ECB 8% 600 Senior debt MEUR 769 11 % Customer 400 deposits EUR 7,212 MEUR 3,933 million 55% 200 Covered bonds MEUR 1,648 23% 0 2018 2019 2020 2021 20
Slide 18: Aktia Bank as covered bond issuer
Aktia Bank as covered bond issuer • The Aktia Bank mortgage loan portfolio is of very high quality: ✓ Only prime residential mortgage loans ✓ Collateral located in Finland ✓ Low average LTV Aktia Bank operates under the • Aktia Bank covered bonds are CRR & UCITS, ECB repo and legislation as mortgage
Slide 19: Cover pools
Cover pools May 2018 Cover Pool 2 (Active pool) Cover Pool 1 Total asset pool EUR 2,379 million EUR 216 million No substitute assets No. of loans / average loan balance 39,365 / EUR 60,424 2,751/ EUR 78,630 First ranking residential mortgages and First ranking residential mortgages and pledges of Ty
Slide 20: The Finnish Economy
The Finnish Economy Strong Economy (with the happiest people of the world) 20
Slide 21: The Finnish Economy
The Finnish Economy Export driven growth Key facts about Finland • Member of EU and Euro area • Population: 5.5 million • Area: 338 430 sq. km • GDP per capita EUR 38 959 (2016) • Credit ratings: Aa1 (stable) / AA+ (stable) / AA+ (stable) 21
Slide 22: The Finnish Economy
The Finnish Economy Growth continues 22
Slide 23: The Finnish Economy
The Finnish Economy Employment rate, 15-64 year olds Private debt, % of GDP 80 225 79 78 > A ” 76 8 4 B n n 70 cy 68 or 66 65 23 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2018 201 2015 z016 2017 2018 2019 ‘Sources: Aktia and Macrabond Sweden Denmark Finiand Frans | Germany ‘Sources
Slide 24: Macroeconomic environment
Macroeconomic environment All is well, for now. World exports Developing economies World Developed economies Sources: Aktia and Macrobond 24
Slide 25: Finnish housing market
Finnish housing market Solid and stable market 25
Slide 26: Courageously. Skilfully. Together.
Courageously. Skilfully. Together. 26
Slide 27: Contacts and additional information
27 Contacts and additional information Timo Ruotsalainen Outi Henriksson Head of Treasury CFO Tel. +358 10 247 7211 Tel. +358 10 247 6236 [email protected] [email protected] Debt investor information: http://www.aktia.com/en/velkasijoittajat (website) http://www.aktia.com/en/julkaisu
Slide 28: APPENDIX
APPENDIX 28
Slide 29: "Happiest People of the world"
”Happiest People of the world” Finland Wins Double Gold in World Happiness Report 2018 · 14 Mar 2018 ROME, March 14 – This year Finland takes the top spot as the happiest country as measured by surveys undertaken by Gallup from 2015-2017. Rounding out the rest of the top ten in order of overall happ