4q 2014 english - sparebank1.no€¦ · ofthiswrite-downrussianok 93 millin 4q 2014. group...
TRANSCRIPT
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Preliminary report and accounts 2014
5 February 2015
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4th quarter report 2014 - Group
• Profits before tax: NOK 1 345 mill (1 181 mill)
• ROE: 12.2 % (13.0 %)
• ROE exclusive of write-down Russia: 14.8 %
• Very good solidity and liquidity
• Proposed cash dividend: NOK 1.90 kr (1.10)
• Payout ratio Group: 38.7 % (26.7 %)
• Continued good macroeconomic outlook for Nord-Norge
2
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3
Nord-Norge – macro economy
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Norwegian economy is moving northwards
4
North Norway will be the newcenter of gravity for theNorwegian economyTromsø, 11/11-14
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5
Growth unless otherwise
stated
NORTHERN NORWAY NORWAY
Est.2013 2014 2015 2016 SSB 2013 2014 2015 2016
Private consumption 107 bn 2 % 2 % 3 % 2,1 % 2 % 2 % 3 %
Public consumption 73 bn 2 % 3 % 3 % 1,6 % 2 % 3 % 3 %
Fixed investments 42 bn 2 % 2 % 3 % 8,7 % 1 % 2 % 3 %
Exports international 49 bn 6 % 7 % 7 % -3,9 % 4 % 4 % 4 %
Imports international 46 bn 2 % 3 % 4 % 2,5 % 2 % 3 % 3 %
Exports to rest of
Norway 85 bn 2 % 2 % 3 %
Imports from rest of
Norway 128 bn 2 % 3 % 3 %
GDP (mainland) 182 bn 3 % 3 % 4 % 2,0 % 2 % 2 % 3 %
Employment 0,9 % 0,5 % 0,5 % 1,0 % 1,2 % 0,5 % 0,0 % 1,0 %
Unemployment level 2,9 % 3,0 % 3,1 % 3,0 % 2,6 % 3,1 % 3,7 % 3,5 %
Economic prognosis: Export growth Norway 4 %, North Norway 7 %
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North Norway – macro-economic advantages
6
• Strong export industries with positive
impulses
• The regional oil and gas industry is still in an
early phase, thus representing an upside
rather than a downside potential
• Considerable infrastructure investments
are planned for the export industries
• The public sector represents a stabilising
factor
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A diversified and growing export oriented business sector
Kilde: SSB/Menon
NO
K b
ill
Gro
wth
–p
rog
no
sis
Exports from North
Norway - NOK billAverage yearly growth 2014 – 2016; prognosis
7
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Seafood from North Norwayon the global food dish
8
Export value from North Norway 2013Estimated share of national export value
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Oil and gas: Considerable discoveries in 2014
Exploration activities 2014 - areas
Number of oil wellsNumber of oil wells Discoveries: Number and volume
Norw.sea
9
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New fields with economic spill-over effects
10
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Speed of exploitation influenced by oil price
Kilde: SSB/Menon
2048: 65% in the
north
11
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NOK 300 bill. investments in infrastructure
12
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Housing market in the north
13
38.958 30.716 21.087 32.561 18.446 17.929
16,6 %
11,2 %
8,1 % 8,1 %
11,6 %
8,1 %
0%
3%
6%
9%
12%
15%
0
10.000
20.000
30.000
40.000
50.000
Tromsø Bodø Finnmark Norge Troms ex Tromsø Nordland ex Bodø
House pricesPrice level and Growth y/y, December 2014
Average price, NOK per m2, all units Price increase y/y
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14
Strategy and brand
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SpareBank 1 Alliance; a frontrunner in digitalization
15
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Banks on the internet; they all look the same
16
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…while the world’s best internet bank is based on a mission
17
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…a fact that has inspired SpareBank 1 Nord-Norge
For Nord-Norge!
18
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A profitable business model
19
• A unique brand
• Local presence
• Regional knowledge
• A national alliance
• Focus on core banking
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20
Financial figures
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Main financial targets
21
Profitability:
• Banking operations at top
international level: Minimum
12% ROE
Solidity:
• undisputable solid
• Internal capital buffer of at least 1 percentage point above the statutory
minimum requirement.
• Long term goal for Core Tier 1 level is currently 14.5 %
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Capital adequacy ratio - Group
22
9,9 %
10,6 %10,3 %
12,3 %12,6 %
5%
6%
7%
8%
9%
10%
11%
12%
13%
31.12.10 31.12.11 31.12.12 31.12.13 31.12.14
Tier I Capital Lower limit Common Equity Tier I
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Profit and loss account - Group
23
(Amounts in NOK million) 31.12.14 31.12.13
Net interest income 1 426 1 285Net fee-, commision and other operating income 966 931Net income from financial investments 602 346Total net income 2 994 2 562
Total costs 1 328 1 209Result before losses and write-downs 1 666 1 353
Net losses and write-downs 321 172
Result before tax 1 345 1 181
Tax 223 214
Resultat virksomhet holdt for salg, etter skatt 27 0
Minority interests - 1 1
Result for the period 1 096 966
Return on equity capital 12,2 % 13,0 %
ROE excluding
write-downs
Russia:14.8 %
23
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Quarterly summary – Profit and loss account figures (Amounts in NOK million) 4Q14 3Q14 2Q14 1Q14 4Q13
Net interest income 378 378 342 328 355Net fee-, commision and other operating income 237 238 248 243 262Net income from financial investments 51 119 189 243 85Total net income 666 735 779 814 702
Total costs 354 325 333 316 327Result before losses and write-downs 312 410 446 498 375
Net losses and write-downs 236 38 22 25 50Result before tax 76 372 424 473 325
Return on equity capital 1,5 % 13,5 % 15,8 % 18,6 % 13,7 %Cost/income 53,2 % 44,2 % 42,7 % 38,8 % 46,6 %
Result before tax exclusive of write-down Russia: NOK 376 mill24
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25
Net interest income - Group
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Changes in net interest income last quarter
Measured
against average
funding cost
26
456
89
11 8
460
0
50
100
150
200
250
300
350
400
450
500
Net interest
income 3Q14
Deposits margin Lending margin
corporate
Lendring margin
private
Other Net interest
income 4Q14
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Lending margin, Parent bank
The interest
margin is defined
as the difference
between the
customer lending
(deposit) interest
rate and average 3
month NIBOR
1,82 %
2,25 %
2,50 %
2,48 % 2,48 %
2,72 % 3,05 %3,11 % 3,12 %
3,04 %2,92 %
2,99 %2,92 %
1,02 %
1,51 % 1,53 %1,64 % 1,68 %
2,15 %
2,41 %2,49 % 2,47 % 2,43 %
2,28 % 2,23 %2,30 %
0,00 %
0,50 %
1,00 %
1,50 %
2,00 %
2,50 %
3,00 %
3,50 %
4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14
Interest margin corporate Interest margin corporate27
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Customer deposit, Parent bank
The interest margin is
defined as the
difference between
average 3 month NIBOR
and the customer
deposit interest rate
0,61 %
0,31 %
0,20 %
0,11 %0,05 %
0,00 %
-0,02 %-0,08 %
-0,12 %-0,16 %
-0,04 %-0,01 % 0,01 %
-0,11 %-0,17 %
-0,35 %
-0,46 %
-0,67 %-0,74 %
-0,81 % -0,81 % -0,82 % -0,81 % -0,79 %-0,84 %
-0,75 %
0,82 %
0,16 %
-0,08 %-0,14 %
-0,37 %
-0,46 %-0,50 % -0,50 %
-0,55 %-0,59 %
-0,43 %
-0,26 %-0,32 %
-1,00 %
-0,80 %
-0,60 %
-0,40 %
-0,20 %
0,00 %
0,20 %
0,40 %
0,60 %
0,80 %
1,00 %
4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14
Interest margin corporate Interest margin publicInterest margin retail28
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Quarterly summary – Profit and loss account figures (Amounts in NOK million) 4Q14 3Q14 2Q14 1Q14 4Q13
Net interest income 378 378 342 328 355Net fee-, commision and other operating income 237 238 248 243 262Net income from financial investments 51 119 189 243 85Total net income 666 735 779 814 702
Total costs 354 325 333 316 327Result before losses and write-downs 312 410 446 498 375
Net losses and write-downs 236 38 22 25 50Result before tax 76 372 424 473 325
Return on equity capital 1,5 % 13,5 % 15,8 % 18,6 % 13,7 %Cost/income 53,2 % 44,2 % 42,7 % 38,8 % 46,6 %
29
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Total commission and other income
526590 567
686
892 940
248 19
44
114100
21,4 %
25,1 %
27,8 %
31,5 %
36,3 %32,3 %
0%
5%
10%
15%
20%
25%
30%
35%
40%
0
200
400
600
800
1.000
1.200
2009 2010 2011 2012 2013 31.12.14
Total other operating income Net commision income Net fee-, commission and other income as % of total net return
30
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Income from financial investmentsGroup
(Amounts in NOK million) 4Q14 3Q14 2Q14 1Q14 4Q13
Dividends 0 0 5 11 27
Income from joint ventures121 142 119 71 303
Gains/losses and net value changes on shares -69 -21 44 144 57Net value changes on bonds, foreign exchange and fin.derivatives -1 -2 21 17 35
Income from financial investments51 119 189 243 422
31
Of this write-down Russia NOK 93 mill in 4Q 2014
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Group operating costs
32
(Amounts in NOK million)
31.12.14 31.12.13 Change
Wages and salaries 587 553 34Pension costs 41 31 10Social costs 76 54 22Total personnel costs 704 638 66
Administration costs 349 337 12Total personnel- and general administration costs 1 053 975 78
Depreciation and write-downs of fixed assets 97 56 41Total operating costs 178 178 0Total costs 1 328 1 209 119
32
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Group operating costs
33 33
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Core banking operations-(excl. income from financial investments)
34 34
(Amounts in NOK million) 4Q14 3Q14 2Q14 1Q14 4Q13
Net interest income 378 378 342 328 355Net fee- and commission income 212 219 221 214 210Other operating income 25 19 27 29 52Total costs 340 325 333 316 327
Underlying banking operations 275 291 257 255 290
Net losses and write-downs 44 38 22 25 50Underlying banking operations
after losses 231 253 235 230 240
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Losses on loans and guarantees - customers
35
185
87101
195
172164
0,31 %
0,14 % 0,15 % 0,26 %0,21 % 0,19 %
0,00 %
0,20 %
0,40 %
0,60 %
0,80 %
1,00 %
1,20 %
1,40 %
0
50
100
150
200
250
2010 2010 2011 2012 2013 2014
NOK mill
Net losses Net losses in % of gross lending incl. SpareBank 1 Boligkreditt and Næringskreditt
Customer losses (NOK 164 mill) includes write-down Russia; NOK 35 mill
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Group companies result before tax
36
(Amounts in NOK 1000) 31.12.14 31.12.13
SpareBank 1 Finans Nord-Norge AS 116 438 98 739SpareBank 1 Nord-Norge Portefølje AS 19 906 -29 776
SpareBank 1 Regnskapshuset Nord-Norge AS 3 839 -1 414EiendomsMegler 1 Nord-Norge AS 15 208 15 356SpareBank 1 Nord-Norge Forvaltning ASA 2 509 2 395North-West 1 Alliance Bank -3 245 1 586EiendomsMegler 1 Lofoten AS (owned by EM1 60%) 344 - 52
Nord-Norge Eiendom IV AS 1 230 0
Alsgården AS - 335 - 3
Fr. Langes gate 20 AS 1 406 0
Total 157 300 86 832
36
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Profit allocation
37
The proposed cash dividend of NOK
1.90 will be distributed to equity
certificate holders registered as
owners as of 24.03.15.
Group pay-out ratio: 36.8 % to both
owner groups.
Equity certificate holders’ share of the
equity (ownership fraction ) at 1
January 2015: 47.33% (unchanged)
37
(Amounts in NOK million)
Parent Bank's profit after tax 743,3
Allocated to cash dividend 190,8
Allocated to dividend equalisation fund 161,0
Total to EC-holders 47,3 % 351,8
Pay-out ratio EC-holders 54,2 %
Allocated to donations 212,3
of which to donation to Sparebankstiftelsen SNN 167,3
Allocated to the Savings Bank's Fund 179,2
Total to the bank's community owned capital 52,7 % 391,5
Payout ratio community owned capital 54,2 %
Total allocated 743,3
Undistributed profit of Parent Bank's profit 45,8 %
Undistributed profit of Group's profit 63,2 %
As part of a faster normalisation of the dividend policy, the Board is planning a
further increase of the pay-out ratio for the accounting year 2015
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Key figures balance sheet
31.12.14 31.12.13 Change %
Total assets 83 188 77 520 5 668 7,3%
Gross lending 61 249 57 282 3 967 6,9%
Loans and advances to customers incl SpareBank 1 Boligkreditt and Næringskreditt
84 980 80 581 4 399 5,5%
Deposits from customers 45 761 44 940 821 1,8%
38
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Lending volume
70
%
30
%
Retail incl. SpareBank
1 Boligkreditt
59
%
41
%
Retail excl. SpareBank
1 Boligkreditt
68.03369.978
72.33174.665 75.914 75.956 76.982
79.08380.581 81.511 82.452
83.946 84.980
0
10 000
20 000
30 000
40 000
50 000
60 000
70 000
80 000
90 000
des. 11 mar. 12 jun. 12 sep. 12 des. 12 mar. 13 jun. 13 sep. 13 des. 13 mar. 14 jun. 14 sep. 14 des. 14
NOK milll
SpareBank 1 Boligkreditt and Næringskreditt Retail banking market Corporate and public
Growth past 12 months:
Loans and advances to customers incl SpareBank 1 Boligkreditt and Næringskreditt 5,5 %
Retail incl. SpareBank 1 Boligkreditt 6,1 %
Corporate and public 3,9 %39
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Deposit volume
41 76539 675
43 745 43 26644 940
43 635
46 94945 386 45 761
80,9 %77,9 %
82,9 %
76,5 %78,45 %
75,71 %
79,86 %
75,19 % 74,71 %
30%
40%
50%
60%
70%
80%
90%
100%
0
5 000
10 000
15 000
20 000
25 000
30 000
35 000
40 000
45 000
50 000
des. 11 mar. 12 jun. 12 sep. 12 des. 13 mar. 14 jun. 14 sep. 14 des. 14
Retail banking market Corporate Public Deposits as a percentage of gross lending
Deposit growth excl. Treasury bills (exchange scheme):
Deposits growht past 12 months 6,8 %Retail banking market 9,1 %Public -1,9 %Corporate 6,1 %40
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41
Credit area
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The Group's non-performing, impaired and other problem commitments
42
31.12.09 31.12.10 31.12.11 31.12.12 31.12.13 31.03.14 30.06.14 30.09.14 31.12.14
Non-performing commitments 575 492 471 397 486 474 457 418 457
Other problem commitments 228 378 338 592 373 345 269 253 90
Individual write-down for impaired value (left axis) 232 273 208 303 244 235 217 243 171
Gross non-performing and impaired commitmentsin % of gross lending incl. agency loans (right axis)
1,34% 1,36% 1,18% 1,30% 1,06% 1,00% 0,88% 0,80% 0,64%
0,00%
0,50%
1,00%
1,50%
2,00%
2,50%
3,00%
0100200300400500600700800900
1.0001.100
MN
OK
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Distribution on segments shows good diversificationLoan portfolio including Boligkreditt
A high share of retail- and primary industry lending represent a risk mitigating factor.
The Group has a well diversified corporate market lending portofolio.
No specific concerns related to the bank's loans to commercial property due to low interest rates and
good occupancy rates in the bank's market area. 43
Property
management
9,9 %
Wage-earners 42,5 %
SPB1 Boligkreditt 27,9 %Construction building 2,3 %
Other service industry 2,2 %
Agriculture, fisheries, fish
farming 5 %
Transport and wholsesale 6,3 %
Maritime sector 0,3 %
Other 3,9 %
Andre 19,7 %
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SpareBank 1 Nord-Norge and Russia
• 2013: SNN decides to downscale activities in Russia. Start up of work on possible exit solutions
started, but due to a continuously deteriorating Russian economy, this has not been realized.
• The economic situation in Russia is challenging due to low oil price, economic sanctions, and a
weak RUB.
• Many Russian bank customers have moved their bank deposits to foreign or government owned
banks, or to banks they perceive as being guaranteed by the state. This has resulted in many
Russian banks, including TB, ending up in a difficult liquidity situation.
• SNN is the main owner in North West 1 Alliance Bank (NW1), TB owns 25 %.
• NW1 is primarily funded by SNN and has not experienced the same liquidity challenges that
many other Russian banks have.
44
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Russia – exposure and status 31.12.14
• Equity exposure TB (NOK countervalue):
‒ TB: NOK 95 mill
‒ NW 1: NOK 70 mill
‒ Total: NOK 165 mill
• Exposure lending (NOK countervalue):
‒ TB/NW 1 NOK 450 mill
• Total exposure: NOK 615 mill
• SNN has reduced its exposure in Russia by more than NOK 200 million since 2013.
• Write-down as at 31.12.2014: NOK 300 mill
45
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Portfolio – Oil related exposure as of 31.12.14
46
The exposure is 2.4 % of total gross lending (incl. Bolig- and Næringskreditt)
Oil Related Exposure by Line of Business (NOK mn)
Total
exposure
o/w
Shipping Comments
Operation (Maintaince & modification, PSV, AHTS*, MPU*) 964 964 all related to PSV, AHTS and MPU
Other 1.055 0
o/w 800 NOK mn are onshore
supportbase
Total 2.019 964
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Portfolio – CHF denominated lending as at 31.01.15
47
• Limited portfolio – countervalue of 974 MNOK
• Fewer than 200 commitments – approx. 160 retail and 40 corporate
customers
• A product to customers with low LTV and good earnings
• Credit policy changed based on our experience last few months
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48
Liquidity/funding
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Funding instruments 31.12.2014
49
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Maturity profile 31.12.14Capital markets funding (excl. SPABOL)
50
• Good diversification in terms of
maturities
• NOK 22.525 mill in capital market
funding exclusive of SB1
Boligkreditt
• SpareBank 1 Boligkreditt is an
important funding source.
Mortgage loans of NOK 23.733
mill transferred as at 31.12.14.
• Amount of gross maturities of
capital market funding next 12
months is NOK 3.611 mill
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51
Summary
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Why invest in SpareBank 1 Nord-Norge?
1) Continued strong macro economics in North Norway
2) Very strong position in the region
4) Good solidity and capacity for profitable growth
3) Profitable growth within core banking activities
52
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SpareBank 1 Nord-Norge
P o Box 6800
N- 9298 Tromsø
CEO Jan-Frode Janson CFO Rolf Eigil Bygdnes
Tel +47 909 75183 Tel +47 905 19 774
SNN home page and internet bank: www.snn.no
Equity capital certificates in general: www.egenkapitalbevis.no
Financial calendar 2015:
29 April
12 August
29 October
Contact information:
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54
Enclosures
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Head office: Tromsø
Organisation: 5 regioner
Regional offices: Hammerfest
Tromsø
Harstad
Bodø
Mo i Rana
Branches: 66
Vision: For Nord-Norge!
SpareBank 1 Nord-Norge
55
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Organisation of the financial services Group
56
SpareBank 1 Nord-NorgeFinancial Services Group
SpareBank 1 Nord-Norge Portefølje ASEquity stake 100 %
EiendomsMegler 1 Nord-Norge AS
Equity stake 100 %
EiendomsMegler 1 Lofoten ASEquity stake 60 %
North-West 1 Alliance Bank
Equity stake 75 %
SpareBank 1 Gruppen ASEquity stake 19,5 %
SpareBank 1 Boligkreditt ASEquity stake 14,71 %
SpareBank 1 Nord-Norge Forvaltning ASA
Equity stake 100 %
SpareBank 1 Næringskreditt ASEquity stake 20,83 %
BN Bank ASAEquity stake 23,5 %
Alliansesamarbeidet SpareBank 1 DAEquity stake 17,74 %
SpareBank 1 Regnskapshuset Nord-Norge ASEquity stake 100 %
SpareBank 1 Kundesenter ASEquity stake 100 %
SpareBank 1 Verdipapirservice ASEquity stake 100 %
SpareBank 1 Kredittkort ASEquity stake 19,83 %
SpareBank 1 Finans Nord-Norge ASEquity stake 100 %
Nord-Norge Eiendom IV ASEquity stake 100 %
Alsgården ASEquity stake 100 %
Fredrik Langs gate 20 ASEquity stake 100 %
SpareBank 1 Markets ASEquity stake 27,02 %
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57
Main financial figures
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Key figures12,6 %
7%
8%
9%
10%
11%
12%
13%
2010 2011 2012 2013 2014
Common Equity Tier I % incl share of result
12,2 %
4%
6%
8%
10%
12%
14%
16%
18%
20%
2009 2010 2011 2012 2013 2014
Return on equity capital
44,4 %
20%
25%
30%
35%
40%
45%
50%
55%
60%
2009 2010 2011 2012 2013 2014
Cost/income group
0,9 %
0,6 %
0,8 %
1,0 %
1,2 %
1,4 %
1,6 %
1,8 %
2,0 %
2009 2010 2011 2012 2013 2014
Total non-perf and impaired commitm. as % of gross loans
58
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Quarterly results – net interest income
(Amounts in NOK million) 4Q14 3Q14 2Q14 1Q14 4Q13
Interest and similar income from loans to and claims on credit institutions 9 13 3 1 1Interest and similar income from loans to and claims on customers 697 699 658 686 773Interest and similar income from certificates, bonds and other interest-bearing securities 49 61 60 62 65Total interest income 0 0 0 0 0Interest and similiar income 755 773 721 749 839
Interest and similar costs on liabilities to credit institutions 16 17 14 13 - 19Interest and similar costs relating to deposits from and liabilities to customers 210 228 215 266 365Interest and similar costs related to the issuance of securities 124 122 121 113 108Interest and similar costs on subordinated loan capital 18 19 20 20 21Payments made to The Norwegian Banks' Guarantee Fund 9 9 9 9 9Total interest costs 377 395 379 421 484
Net interest income 378 378 342 328 355
59
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Total commission and other income(Amounts in NOK million) 4Q14 3Q14 2Q14 1Q14 4Q13
Guarantee commissions 8 7 9 8 9Interbank commissions 5 4 5 4 5Credit arrangement fee 2 2 2 2 3Arrangement fee from SpareBank 1 Boligkreditt 81 80 87 95 91Arrangement fee from SpareBank 1 NN Finans 1 1 0 1 0Securities trading, administration and trust department services8 7 8 8 9Payment transmission services 55 67 57 52 55Brokerage commission 25 25 25 20 18Insurance services 33 32 38 31 32Other commission income 14 13 9 9 11Total commissions income 232 238 240 230 233
Operating- and sales income real estate 3 3 4 4 11Other operating income 22 16 23 25 41Total other operating income 25 19 27 29 52
Commission expenses 20 19 19 16 23
Net fee-, commision and other operating income 237 238 248 243 262
60
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Operating expenses(in NOK million) 4Q14 3Q14 2Q14 1Q14 4Q13
Wages and salaries 152 159 134 142 154Pension costs 11 9 13 8 3Social costs 27 25 12 12 17Sum personalkostnader 190 193 159 162 174
Development costs 28 27 26 26 29Electronic data processing costs 19 17 17 15 14Marketing costs 16 19 19 21 14Travel - and training costs 10 5 8 9 10Communications 0 3 3 3 3Postage 3 3 3 3 3Consultancy services 6 4 6 6 10Cost involving the handling of cash 3 4 2 3 3Office-related costs 2 3 3 2 1Collection costs 1 1 1 1 1Ordinary depreciation 29 14 40 14 13Operating costs - premises/buildings 11 7 7 8 20Other operating costs incl rent 36 26 40 43 33Other costs 164 132 174 154 153
Total operating expenses 354 325 333 316 327
61
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Credit growth corporates
62
3,9
3,4
-4
-2
0
2
4
6
8
10
12
14
16
2011M12 2012M12 2013M12 2014M12
%
Credit growth corporates. 12 mth growth
SNN, Corporate clients Norway, Corporates
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Credit growth households
63
6,16,2
0
2
4
6
8
10
12
14
2011M12 2012M12 2013M12 2014M12
%
Credit growth households. 12 mth growth
SNN, Retail clients Norway, Households
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Deposit growth corporates
64
6,1
4,3
-10
-5
0
5
10
15
20
2011M12 2012M12 2013M12 2014M12
%
Deposit growth corporates. 12 mth. growth
SNN, Corporate clients Norway, Corporates
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Deposit growth households
65
9,1
7,2
0
2
4
6
8
10
12
2011M12 2012M12 2013M12 2014M12
%
Deposit growth households. 12 mth. growth
SNN, Retail clients Norway, Households
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66
Credit area
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Lending portfolio - comments
• Good increase in retail lending, with focus on commitments qualifying for
SpareBank 1 Boligkreditt (covered bond company).
• Moderate growth in corporate market lending in 2014.
• The portfolio and growth in corporate sector lending is diversified.
• Reduced individual losses in 2014 compared with losses as of 2013.
67
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Loan losses: The Group's write-downs as at Q4 2014
68
Write-downs
2014 20134th quarter
2014 (iso)
4th quarter
2013 (iso)
Individual write-downs Retail market 25 14 17 2
Corporate market 148 136 81 34
SpareBank 1 Finans Nord-Norge 5 9 2 4
Other group units 16 13 7 4
Total individual write-downs 193 172 107 44
Collective write downs and other value change items 34 0 10 6
Effects from consolidations -63 0 -38 0
Total write-down on loans and guarantees 164 172 79 50
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Portfolio - exposure as of 31.12.14, parent bank
69
0
5.000
10.000
15.000
20.000
25.000
30.000
35.000
Næringskreditt Boligkreditt Low risk Medium risk High risk Default/impaired
NO
K m
ill
Retail market Corporate market SB1 Boligkreditt SB1 Næringskreditt
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Portfolio - exposure as of 31.12.14
70
Loans distributed by size of exposure and share of EAD
74%
11%9%
6%
70%
16%
8%6%
Below 10 mnok 10 - 100 mnok 100 - 250 mnok Above 250 mnok
Share of loanexposure (EAD) Dec 2014 Share of loanexposure (EAD) Dec 2013
Numbers includes SB 1 Bolig- and Næringskreditt
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Loan losses: The Group's write-downs as of Q4 2014
71
Write-downs
2014 20134th quarter
2014 (iso)
4th quarter
2013 (iso)
Individual write-downs Retail market 25 14 17 2
Corporate market 148 136 81 34
SpareBank 1 Finans Nord-Norge 5 9 2 4
Other group units 16 13 7 4
Total individual write-downs 193 172 107 44
Collective write downs and other value change items 34 0 10 6
Effects from consolidations -63 0 -38 0
Total write-down on loans and guarantees 164 172 79 50
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Equity certificate holders
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Equity Certificates (EC) - holder structure
73 73
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The 20 largest EC holders
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Number of Share of total
Equity Certificate holders Equity Certificates capital
Pareto Aksje Norge 5.253.551 5,23 % MP Pensjon Pk 2.720.503 2,71 % Citibank, N.A. 2.385.597 2,38 % Pareto Aktiv 2.209.269 2,20 % Frank Mohn A/S 2.204.670 2,20 % Flps - Princ All Sec Stock Sub 1.795.800 1,79 % Sparebankstiftelsen Sparebank 1 Nord-Norge 1.411.606 1,41 % Forsvarets Personellservice 1.233.930 1,23 % Arctic Funds PLC 1.184.907 1,18 % Verdipapirfondet Dnb Norge (IV) 1.066.353 1,06 % VPF Pareto Verdi 1.056.986 1,05 % J.P. Morgan Chase Bank N.A. London 918.400 0,91 % Morgan Stanley & Co Llc 912.064 0,91 % Larre Eiendom 2 AS 873.623 0,87 % Tonsenhagen Forretningssentrum 2 AS 873.623 0,87 % Sparebankstiftelsen DnB NOR 840.306 0,84 % AS Atlantis Vest 806.114 0,80 % Renterisiko AS 770.265 0,77 % Consept Eiendom AS 739.796 0,74 % Morgan Stanley & Co Llc 662.873 0,66 %The 20 largest EC holders 29 920 236 29,80 %
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The 20 largest EC holders residing in Northern Norway
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Number of Share of total
Equity Certificate holders Equity Certificates Equity Certificate capital
Sparebankstiftelsen Sparebank 1 Nord-Norge 1.411.606 1,41 %
Consept Eiendom AS 739.796 0,74 %
Karl Ditlefsen 547.543 0,55 %
Norges Råfisklag 457.490 0,46 %
Troms Kraft AS 409.224 0,41 %
Tromstrygd 289.308 0,29 %
Taj Holding AS 260.000 0,26 %
Hansen Dahl Fiskeri AS 216.046 0,22 %
Tor Ovesen 206.556 0,21 %
Ole Alfred Rolf Ovesen 205.554 0,20 %
Agnar Holding AS 189.022 0,19 %
Gadd Holding AS 174.539 0,17 %
Entreprenørcompaniet Nord AS 169.596 0,17 %
Tromsø Skotøimagasin A/S 157.090 0,16 %
Rigamonti A/S 141.393 0,14 %
Brødrene Karlsen Holding AS 119.705 0,12 %
Odd Berg AS 119.545 0,12 %
Hemming Leonharth Andersen 113.567 0,11 %
Geir Andre Steiland 110.000 0,11 %
Hamneidet Eiendom AS 102.062 0,10 %
The 20 largest EC holders residing in Northern
Norway ¹) 6 139 642 6,12 %1) Postal code > 7999
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SpareBank 1 Group and Alliance
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Sr. Unsec. Ratings Fitch Moody’s
SpareBank 1 SMN A- / F2 A2 / P-1
SpareBank 1 SR-Bank A- / F2 A2 / P-1
SpareBank 1 Nord-Norge A / F1 A2 / P-1
Sparebank 1 Hedmark n/a A2 / P-1
• Founded 1996 - Economies of Scale - key banks in the Alliance trace their history back to the 1820’s
• Local presence – Norway’s most extensive branch network with 350 branches
• 2nd largest mortgage lender in the Norwegian Retail Market
• Market leader in its local markets - The neighbourhood bank with market shares from 30 - 50%
• Approx two thirds are retail lending- Rest is SME lending
SMN
SpareBank 1 - AllianceStrong alliance of Norwegian retail banks
Oslo
Tromsø
Trondheim
Bergen
Stavanger
Kristiansand
7777
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Joint ProductPlatforms
Operational
Integration
Central
Functions
Property/Casualty Insurance
Life Insurance
Mutual Funds
Cards and Payments
Leasing Finance
Factoring and Collection
Markets
Risk Management
Underwriting procedures
(scorecards, models and credit policies)
IT System
SpareBank 1 Boligkreditt
SpareBank 1 Næringskreditt
Marketing and Branding
Business Development
Market Analysis
Procurement
Centres of Excellence
SpareBank 1
SR-Bank
SpareBank 1
SMN
SpareBank 1
Nord-Norge
Sparebank 1
Hedmark
11 Smaller SpareBank 1
Banks
The banks issue senior unsecured, subordinated and capital instruments individually
SpareBank 1 Alliance Structure
All banking and ancillary
products customers
Equity and creditinvestors
Covered bond investors
Mortgages, capital, commitments,
human resources etc.
Services, dividends,commissions,
covered bond funding
7878
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SpareBank 1 - Alliance Second largest lender in Norway
Source: Banks‘ annual reports and own estimates, NBIM, Statistics Norway7979