q1 2009 financial results for sparebank 1 gruppen presented by acting ceo kirsten idebøen
DESCRIPTION
Download presentation from press conference April 28th 2009. Last ned kvartalspresentasjonen for SpareBank 1 Gruppen AS - Q1/2009.TRANSCRIPT
Quarter 1 2009Presentation of results SpareBank 1 Gruppen
Kirsten Idebøen, acting CEO
28 April 2009
Highlights 1st quarter 2009
22
• Profit was hit by the turbulent financial markets. SpareBank 1 Livsforsikring has a shareholding of 11 % in the group portfolio as at 31 March 2009. The group is financially sound
• The profit after tax is strongly affected by the calculated effect of the tax exemption method and tax rules for investments in foreign equity funds linked to SpareBank 1 Livsforsikring
• SpareBank 1 Gruppen has commenced a profitability and cost cutting programme that will create lasting and enhanced profitability
• Focus on new business within the securities area through Argo Securities and debt collection through SpareBank 1 Gruppen Finans Holding
Satisfactory profit before tax, considering the current market conditions
• Pre-tax profit in Q1 was MNOK 99.9 (99.5)
• Profit after tax in Q1 was MNOK 5 (64). The high tax cost is owing to the calculated effect of the tax exemption method in SpareBank 1 Livsforsikring
• At the end of March, assets under management were NOK 58.3 billion, up NOK 1.8 billion from 31 December 2008
• Core and capital adequacy ratio of 9.8 % and 14.5 % respectively as at 31 March 2009, against 9.4 % and 12.6 % last year
Pre-tax profit group
236
100 100137
122
0
50
100
150
200
250
2005 2006 2007 2008 2009
MN
OK
Pre-tax profit - Q1
33
Product companies hit by financial crisis
Pre-tax profit/loss in subsidiaries
• Overall profit before tax for the subsidiaries in Q1 was MNOK 125 (131)
• Positive growth and improvement in net risk result. The life insurance company is financially sound
• Healthy financial return to date this year counterbalances a weaker insurance result in the P&C insurance company
• Reduced volumes under management in ODIN Forvaltning yield negative result
• Increased commission and financial income in Bank 1 Oslo. Profit in first quarter dominated by higher loan loss provisions and reduced net interest income
54
30
-52
32
2413
-8
48
-70
-50
-30
-10
10
30
50
70
SB1
Skad
efor
s.
OD
INMN
OK
Pre-tax profit Q1 2008Pre-tax profit Q1 2009
SB1
Livs
fors
.*
Ban
k 1
Osl
oko
nser
n
11*
66*
* In the consolidated accounts, MNOK 42.0 (62.6) of the loss on interests is covered by the customer’s additional provisions in Q1 2009. Allowing for this, the pre-tax profit would have been MNOK 66.4 (10.8) from the life insurance company.
44
SpareBank 1 Gruppen group
Profit/loss for Q1 2009Year
Figures in MNOK 2009 2008 2008
Part of result from subsidiaries before tax - SpareBank 1 Livsforsikring 24.4 -51.8 -990.5 - Additional provisions recognised as income in consolidated accounts 42.0 62.6 0.0 - SpareBank 1 Skadeforsikring 48.1 54.1 217.7 - Bank 1 Oslo konsern 13.1 31.9 3.1 - ODIN Forvaltning -7.5 30.3 115.2 - Argo Securities -12.9 0.0 -4.0 - SpareBank 1 Medlemskort 5.6 4.0 12.1 - Share of other companies 5.3 1.7 15.4 - Correction subsidiaries - pro forma IFRS 7.4 -1.8 -5.6Net result before tax from subsidiaries 125.4 131.0 -636.6Total operating costs holding -13.2 -10.8 -47.8Net investment charges holding -17.4 -23.6 -67.8Gains from sale of companies holding 0.0 0.0 21.1Share of associated company - First Securities 5.1 4.2 17.7Net result before amortisation 99.9 100.8 -713.4Amortisation 0.0 -1.3 -18.2Pre-tax result 99.9 99.5 -731.6Taxes -94.8 -35.9 -126.2Net result for the period 5.2 63.7 -857.7
Majority interest 7.5 63.5 -858.1Minority interest -2.3 0.1 0.4
Q1
*
* Other companies comprise SpareBank 1 Gruppen Finans Holding AS (parent company), Actor Fordringsforvaltning AS, SpareBank 1 LTO AS and Verdigjenvinning AS
55
Bank 1 OsloIncreased commission and financial income
66
Bank 1 Oslo (group)
Increased commission and financial income
Pre-tax profit per quarter
77
27 32
13
-70
-50
-30
-10
10
30
50
2007 2008 2009
MN
OK
Pre-tax profit - Q1
• Pre-tax profit of MNOK 13 (32) for Q1
• The decline in profit is largely attributable to higher loan loss write-downs, combined with reduced net interest income
• Losses on loans MNOK 35 (-4) in Q1
• Gross non-performing and impaired loans amount to 2.1 % (0.9 %) of gross loans as at 31 March 2009
Bank 1 Oslo (parent bank)
Good lending growth, but reduced net interest income
88
Net interest income per quarter
83.090.4
97.0 96.7 95.9105.3
89.9 88.8
0.0
20.0
40.0
60.0
80.0
100.0
120.0
Q22007
Q32007
Q42007
Q12008
Q22008
Q32008
Q42008
Q12009
MN
OK
1.0 %1.1 %1.2 %1.3 %1.4 %1.5 %1.6 %1.7 %1.8 %1.9 %2.0 %
Net interest income Net interest income measuredagainst average total assets
• Lending growth of 17.4 % last 12 months. RM rose by 23.5 % and CM by 4.6 %
• Net interest income of MNOK 89 (97) in Q1, down 8.2 %
• Net interest income for first quarter of 1.41 % (1.86 %)
Bank 1 Oslo (parent bank)
Margin and volume growth
The reference interest rate used in the margin calculation is 3 months NIBOR + 0.10 bp (the bank’s intra-group interest rate)
MN
OK 1.15 %
1.05 %
0.81 %0.71 %0.72 %
0.90 %
0.62 %0.69 %
1.27 %
2.17 %
0.91 %0.98 %1.04 %1.20 %
1.33 %1.50 %
1.64 %
1.37 %1.49 %1.51 %
0.83 %
0.78 %
1.25 %
-0.19 %10,000
12,000
14,000
16,000
18,000
20,000
22,000
Q22006
Q32006
Q42006
Q12007
Q22007
Q32007
Q42007
Q12008
Q22008
Q32008
Q42008
Q12009
-0.20 %
0.30 %
0.80 %
1.30 %
1.80 %
2.30 %
Lending Spread for ordinarylending to customers
Spread for depositsfrom customers
99
Bank 1 Oslo (parent bank)
Increase in non-performing loans
Non-performing loans = Total of overdue claims over 90 days and impaired non-overdue claims over 90 days
203.6 220.0 214.0165.8 162.7
113.1
246.1
400.6459.2
240.9
% 1. kv 2008
0.0
50.0
100.0
150.0
200.0
250.0
300.0
350.0
400.0
450.0
500.0
Q42006
Q12007
Q22007
Q32007
Q42007
Q12008
Q22008
Q32008
Q42008
Q12009
MNOK
-
0.5
1.0
1.5
2.0
2.5
Total non-performing loansas % of gross loans
Per cent
1010
Bank 1 Oslo (parent bank)
Increase in losses on loans
MNOK
-1.13.8
-0.15.0
-34.90.3-25.9 -9.3
-40.0
-35.0
-30.0
-25.0
-20.0
-15.0
-10.0
-5.0
0.0
5.0
10.0
Q1 2008 Q1 2009
Individualwrite-downs
Collectiveimpairment
Net write-offsand incomings on previous write-offs
Net loanlosses
1111
Bank 1 Oslo (group)
Increased commission and financial income
• Net commission income and other income of MNOK 88 (52) for Q1
• Commission income from real estate agency up 44.4 % to MNOK 29 (20)
• Positive result from EM1 Oslo & Akershus of MNOK 0.1 (-5.9). The improvement is owing to:– comprehensive restructuring in 2008– link between the public’s expectations of
interest rates and home purchases– recovery in the market– EM1 has increased its market share from
7.1 % as at 31 December 2008 to 8.2 %
• Income from financial investments was MNOK 21 (-5) and is owing to:– value change of bonds and primary
capital certificates– currency and derivatives income– dividend received from shares and
primary capital certificates
Other income per quarter
-40
-20
0
20
40
60
80
100
Q22007
Q32007
Q42007
Q12008
Q22008
Q32008
Q42008
Q12009
MN
OK
Guarantee commissions/othersReal estate agency commissionRevenue from financial investmentsPayments systemCommission revenues from insurance and savings
1212
Bank 1 Oslo (group)Profit/loss for Q1 2009
Figures in MNOK 2009 2008
Net interest income 88.5 96.9Other operating income 86.4 52.1Operating costs 127.4 120.9Operating result before losses 47.5 28.1Net loan loss provisions 34.9 -3.8Share of associated company 0.6Pre-tax operating profit 13.1 31.9Taxes 2.2 8.9Net profit/loss for the period 10.9 23.0
Key figures Q1Figures in percentage 2009 2008Net interest margin 1.41 % 1.86 %Cost/income ratioexcl. equity investment portfolio (parent bank) 70.9 % 70.3 %Cost/income ratioincl. equity investment portfolio 72.9 % 81.1 %Return on equity (parent bank) 4.7 % 9.5 %Return on equity 4.4 % 8.1 %Deposit coverage ratio 75.7 % 72.7 %Capital adequacy ratio (parent bank) 11.6 % 11.4 %
Q1
1313
SpareBank 1 LivsforsikringPositive increase in profit before tax
1414
SpareBank 1 Livsforsikring
Positive increase in profit before tax
Pre-tax profit/loss per quarter
1515
• Pre-tax profit of MNOK 24 (-52) in Q1• Positive development in net risk result;
MNOK 87 (63) to date this year• The investment result reflects the
financial crisis and is MNOK -51 (-59)• Total assets as at 31 March 2009 are
NOK 21.2 billion, up NOK 0.1 billion from 31.12.08
• The return on the company’s assets so far this year totals MNOK 34 (-16) and is due to the company being out of shares in the company portfolio, as well as one-off factors
• Additional provisions may not be utilised during the year in the company, but are recognised as income in the consolidated accounts in SpareBank 1 Gruppen by MNOK 42 in Q1
93
-52
24
-100
-50
0
50
100
150
2007 2008 2009
MN
OK
Pre-tax profit/loss - Q1
SpareBank 1 Livsforsikring
The life insurance company financially sound
Growth in buffer capital
1616
8.2 %
6.0 %5.8 %
9.3 %
6.3 %5.8 %
-4 %
-2 %
0 %
2 %
4 %
6 %
8 %
10 %
Q42007
Q12008
Q22008
Q32008
Q42008
Q12009
Perc
ent
Securities adjustment reserveAdditional provisionsInterim profitCore capital in excess of minimum
• Core capital and capital adequacy ratio of 11.7 % (9.7 %) and 15.1 % (12.5 %) respectively as at first quarter
• The buffer capital with additional provisions within a one year interest rate guarantee equals 6.0 % (6.3 %) at the end of March
• Estimated solvency margin at the end of Q1 was 191 % (238 %)
SpareBank 1 Livsforsikring
Continued high shareholding in the group portfolio
As at 31 March 2009
Investment choice portfolio
53 %13 %
34 %
Stocks Other Bonds
Group portfolio
26 %
35 %11 % 5 %
23 %
Stocks OtherReal estate Bonds held to maturityBonds
Company portfolio
26 %
0 % 6 %32 %
36 %
Stocks OtherReal estate Bonds held to maturityBonds
NOK 14.8 billion NOK 3.9 billionNOK 1.4 billion
1717
SpareBank 1 Livsforsikring
Value-adjusted return on customer portfolios with guarantee (excl.
value change bonds held to maturity)
-4,9
-2,1
0,5
-0,2
0,3
-6
-5
-4
-3
-2
-1
0
1
SpareBank 1 Storebrand Vital Nordea
Perc
ent
Q42008
Q12009
Q42008
Q12009
Q42008
Q12009
Q42008
Q12009
N/A N/A N/A
1818 Source: company presentations
SpareBank 1 Livsforsikring Profit/loss for Q1 2009
Figures in MNOK 2009 2008 Insurance risk income 310.4 289.6 Insurance risk claims -211.8 -207.2Risk result 98.6 82.4 Tecnical allocations -11.7 -19.6Risk result after tecnical allocations 86.9 62.8 Fees 149.6 137.7 Expenses, exclusive comissions -139.8 -123.7 Comissions -47.0 -48.0Administration result -37.3 -34.0 Net investment income 59.3 49.3 Guaranteed interest to policyholders -110.1 -107.9Investment result -50.8 -58.6Result before allocations -1.1 -29.8 Allocation to additional provisions 0.0 0.0 Transferred to policyholders -8.9 -5.8 Return on company's assets 34.4 -16.2Net profit to owner before tax 24.4 -51.8 Taxes 0.0 0.0Net profit/loss for the period 24.4 -46.1
Key figures Q12009 2008
Capital adequacy ratio 15.1 % 12.5 %Buffer capital in % of insurance provisions 6.0 % 6.3 %
Q1
*
* The company’s accounts do not show the tax cost because deferred tax advantages are not recognised in accordance with accounting standard IAS 12. The company’s tax cost of MNOK 76 to date this year is included in SpareBank 1 Gruppen’s consolidated tax
1919
SpareBank 1 SkadeforsikringGood financial return andportfolio growth to date this year
2020
SpareBank 1 SkadeforsikringGood financial return and portfolio growth to date this year
Pre-tax profit per quarter
• Pre-tax profit for Q1 was MNOK 48 (54)
• Net financial income as at March was MNOK 66 (8). The financial return to date this year equals 0.7 % (0.1 %)
• The insurance result for Q1 totals MNOK -13 (48)
• The claims ratio for own account totals 79.5 % (74.2 %). The increase is owing to major claims within CM
• Combined ratio for own account is 100.6 % (93.9 %) as at 31 March 2009
• Positive portfolio growth within both CM and RM in Q1. Total portfolio increase of MNOK 68 (15)
66
5448
0
10
20
30
40
50
60
70
2007 2008 2009M
NO
KPre-tax profit - Q1
2121
SpareBank 1 SkadeforsikringTwo major claims in Q1 push up combined ratio for own account
Combined ratio for own account shown by quarter
69.0 % 72.1 %73.9 %69.3 %66.7 %
20.6 %20.7 %
22.1 % 20.5 %21.6 %
0 %
10 %
20 %
30 %
40 %
50 %
60 %
70 %
80 %
90 %
100 %
2004 2005 2006 2007 2008Claims ratio Cost ratio
Combined ratio for own account per annum
87.2 %89.9 %
94.6 %91.1 % 93.7 %
21.1 %
76.7 % 72.5 % 72.4 % 74.0 % 74.2 % 70.3 % 74.1 % 69.7 %79.5 %
19.5 % 21.8 %21.2 %20.2 % 19.7 % 23.5 % 20.9 % 23.3 %
97.9 %92.7 % 91.9 %
100.6 %93.1 %95.1 %93.8 %93.9 %95.9 %
-10 %
10 %
30 %
50 %
70 %
90 %
110 %
Q12007
Q22007
Q32007
Q42007
Q12008
Q22008
Q32008
Q42008
Q12009
Claims ratio Cost ratio
2222
SpareBank 1 Skadeforsikring
Allocation of financial assets
Bank deposits3.6 %
Bonds60.9 %
Stocks4.5 %
Bonds held to maturity11.8 %
Real estate15.0 %
Hedge funds4.2 %
Total: NOK 7.8 billion
As at 31 March 2009
2323
SpareBank 1 SkadeforsikringProfit/loss for first quarter 2009
Figures in MNOK 2009 2008Gross written premium 1,237.9 1,191.2Net earned premium 919.2 902.6Net incurred claims -730.5 -669.7Net insurance operating costs -194.2 -177.7Changes in other technical reserves -7.9 -7.0Operating result before finance -13.3 48.3Net financial income 65.8 8.4Other costs -0.3 0.8Result before changes in security reserve 52.2 57.5Changes in security reserve -4.1 -3.4Pre-tax profit 48.1 54.1Taxes -13.5 -15.1Net profit/loss for the period 34.6 39.0
Key figuresFigures in percentage 2009 2008Claims ratio, net 79.5 % 74.2 %Cost ratio, net 21.1 % 19.7 %Combined ratio, net 100.6 % 93.9 %Capital adequacy ratio 28.2 % 27.3 %
Q1
Q1
2424
ODIN ForvaltningReduced assets under management
2525
ODIN Forvaltning
Reduced assets under managementPre-tax profit as at Q1
-7
30
67
-100
1020304050607080
2007 2008 2009
MN
OK
• Pre-tax loss of MNOK -7 (30) in Q1• The decline in profits is owing to a
lower level of assets under management than in Q1 2008
• Assets under management fell NOK 1.7 billion in Q1 to NOK 17.5 billion.
• Equity fund market share equalled 13.1 %, down from 13.8 % at the beginning of the year
Growth in profit for the year before tax
60.6
146.4
232.1
299.5
115.2
3.44.824.030.320.415.6
83.2
0.0
50.0
100.0
150.0
200.0
250.0
300.0
350.0
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
MN
OK
2626
ODIN ForvaltningProfit/loss for Q1 2009
Figures in MNOK 2009 2008Management fees 46.3 82.5Subscription and redemption fees 6.2 14.7Total operating income 52.5 97.2Salaries 19.2 27.0Depreciations 4.1 3.4Other operating costs 31.7 41.0Total operating costs 55.0 71.4Operating profit -2.5 25.8Net financial income -5.0 4.5Pre-tax profit -7.5 30.3Taxes -1.9 8.5Net profit -5.6 21.8
Q1
2727
Argo Securities
2828
New securities business
Argo Securities
New securities business
2929
Q1Figures in MNOK 2009Commission income on stocks & derivatives 4.5Debt Capital Markets 0.6Net trading result 0.3Fee income Corporate finance 0.2Total operating income 5.7Salaries, bonus etc. -14.0Depreciations -1.1Losses on accounts receivable 0.0Other operating costs -4.8Operating profit -14.2Net financial income 1.3Pre-tax profit -12.9Taxes 3.6Profit after tax -9.3
• The company was established in October 2008
• SpareBank 1 Gruppen AS owns 75 % of Argo Securities AS
• The group’s share of profit after tax is a loss of MNOK 7.0, owing to start-up costs
SpareBank 1 Gruppen Finans HoldingNew value chain within debt collection
3030
SpareBank 1 Gruppen Finans Holding
New value chain within debt collection
3131
• Consists of factoring, debt collection and acquisition of non-performance portfolio
• Target group: Banks, insurance companies, card companies and other finance companies– Demand for this type of product
supplied by established finance institution
• Strengthens Sparebank 1 Gruppen as a supplier of financial products and strengthens the Group’s financial foundations– Supplements the Group’s traditional
products– The products have historically been
profitable, and shown increasing earnings
– Partly counter-cyclical
Actor Fordrings-forvaltning
(100%)
SpareBank 1 LTO
(100%)
SpareBank 1 Factoring(100%)
Verdigjenvinning(100%)
SpareBank 1 Gruppen Finans
Holding AS(100%)
Financial information:• The parent company’s equity
approx MNOK 225• Approx. 90 employees (group)• Expected overall turnover 2009: MNOK
137• Expected overall EBIT 2009: MNOK 32
Other factors
3232
New profitability programme at SpareBank 1 Gruppen which commenced in first quarter is expected to yield significant bottom line effect
3333
• The programme will create lasting and enhanced profitability for SpareBank 1 Gruppen
• Broad involvement of the organisation– Assess potential for cost savings within all parts of the group– Assess the opportunities to increase revenues through initiatives to realise
synergies between the companies in the group and as a supplier to the alliance banks
• Implementation and realisation of initiatives will take place between Q3 2009 and Q2 2010
3434
Bank. Insurance. And you.
Appendix
3535
SpareBank 1 Gruppen group Quarterly results
Q1 Q4 Q3 Q2 Q1 Q4Figures in MNOK 2009 2008 2008 2008 2008 2007
Part of result from subsidiaries before tax - SpareBank 1 Livsforsikring 24.4 -647.6 -334.9 43.7 -51.8 46.6 - Additional provisions recognised as income in consolidated accounts 42.0 -307.7 286.8 -41.7 62.6 0.0 - SpareBank 1 Skadeforsikring 48.1 -19.3 58.0 125.0 54.1 133.6 - Bank 1 Oslo konsern 13.1 -57.1 -6.2 34.4 31.9 32.4 - ODIN Forvaltning -7.5 30.0 25.7 29.2 30.3 73.7 - Argo Securities -12.9 -4.0 0.0 0.0 0.0 0.0 - SpareBank 1 Medlemskort 5.6 -0.3 4.2 4.2 4.0 2.2 - Share of other companies 5.3 4.7 3.6 5.4 1.7 2.6 - Correction subsidiaries - pro forma IFRS 7.4 -7.4 -3.3 7.0 -1.8 -41.0Net result before tax from subsidiaries 125.4 -1,008.6 33.8 207.2 131.0 250.1Total operating costs holding -13.2 -16.3 -8.8 -11.9 -10.8 -17.7Net investment charges holding -17.4 -15.4 -15.9 -12.9 -23.6 -15.2Gains from sale of companies holding 0.0 -0.6 21.7 0.0 0.0 2.8Share of associated company - First Securities 5.1 -3.7 0.9 16.4 4.2 21.8Net result before amortisation 99.9 -1,044.6 31.6 198.8 100.8 241.7Amortisation 0.0 -1.3 -14.2 -1.3 -1.3 -1.3Pre-tax result 99.9 -1,046.0 17.4 197.5 99.5 240.4Taxes -94.8 -33.3 -7.0 -50.0 -35.9 89.2Net result for the period 5.2 -1,079.3 10.4 147.4 63.7 329.5
Majority interest 7.5 -1,078.9 10.2 147.0 63.5 329.3Minority interest -2.3 -0.4 0.3 0.4 0.1 0.2
*
* Other companies comprise SpareBank 1 Gruppen Finans Holding AS (parent company), Actor Fordringsforvaltning AS, SpareBank 1 LTO AS and Verdigjenvinning AS
3636
SpareBank 1 Gruppen’s ownership structure
SpareBank 1 Gruppen AS
- Broad alliance- Brands- Technology- Expertise- Shared processes and utilisation of best practise- Purchasing
- Regional centres of expertise- The Payments Sector: Trondheim- Credit: Stavanger- Teaching: Tromsø
SpareBank 1SR-Bank (19.89 %)
SpareBank 1SMN
(19.89 %)
SpareBank 1Nord-Norge (19.89 %)
SparebankenHedmark (11.14%)
SamarbeidendeSparebanker (19.89 %)
LO(9.29%)
The Alliance
SpareBank 1 Oslo
(100%)
SpareBank 1Skadeforsikring
(100%)
SpareBank 1Livsforsikring
(100%)
ODIN Forvaltning
(100%)
Actor Fordrings-forvaltning
(100%)
Argo Securities
(75%)
SpareBank 1 LTO
(100%)
SpareBank 1 Factoring(100%)
First Securities(24.5%)
SpareBank 1 Boligkreditt
EiendomsMegler 1
BNbank
(Bank-owned operation)
*SpareBank 1 Gruppen Finans
Holding AS(100%)
SpareBank 1Medlemskort
(100%)
Verdigjenvinning(100%)
3737
Bank 1 Oslo (parent bank)Increasing non-performing loans in CM
160.8 169.2 157.1102.3 104.7
63.8
178.7
283.1349.442.8
63.6 58.049.3
67.4
117.5
109.8
193.3
47.657.050.8
0.050.0
100.0150.0200.0250.0300.0350.0400.0450.0500.0
Q42006
Q12007
Q22007
Q32007
Q42007
Q12008
Q22008
Q32008
Q42008
Q12009
MN
OK
Corporate market Retail market
3838
SpareBank 1 LivsforsikringBalance sheet for Q1 2009
Figures in MNOK 2009 2008 Intangible assets 78 356 Investments 1,366 1,648 Reinsurance's part of insurance obligations 213 70 Accounts receivable 520 428 Other assets 219 160 Prepayed liabilities and accrued income 0 3 Investments group portfolio 14,894 15,561 Investments options portfolio 3,947 4,683Total assets 21,237 22,909 Paid in capital 830 530 Other equity 329 858 Subordinated loan capital 525 525 Insurance obligations - contractual 14,922 15,484 Insurance obligations - investment options 3,991 4,683 Provisions for obligations 87 53 Premium deposits from reinsurance companies 119 0 Other obligations 356 690 Accrued liabilities, prepaied income 77 86Total liabilities and equity 21,237 22,909
Q1
3939
SpareBank 1 Livsforsikring
Return ordinary customer portfolio with guarantee as at 31 March2009
1,6
1,4
1
2,1
1,4
-8,7
-0,1
-10 -8 -6 -4 -2 0 2 4
Real estate
Held to maturity
Foreign bonds
Norwegian bonds
Money market
Foreign shares
Norwegian shares
Percent
4040
SpareBank 1 Livsforsikring
Booked return for customer portfolios with guarantee
-2,8
0,30,5
2,0 1,9
-4
-3
-2
-1
0
1
2
3
SpareBank 1 Storebrand Vital Nordea
Perc
ent
Q42008
Q12009
Q42008
Q12009
Q42008
Q12009
Q42008
Q12009
SpareBank 1 Storebrand Vital Nordea
N/A N/A N/A
4141 Source: company presentations
SpareBank 1 LivsforsikringGrowth in premium income
Q1Figures in MNOK 2009 2008 Individual annuity and pension insurance 62.8 50.3 Individual endowment insurance 119.2 115.3 Group pension insurance 273.4 377.6 Individual life insurance 41.7 40.7 Group life insurance 212.1 194.6 Unit Linked - Annuity 11.8 10.0 Unit Linked - Endowment 44.6 71.1 Defined contribution pension 190.9 159.8Total gross due premium income 956.5 1,019.4 Premium reserves transferred from other companies 65.7 228.5 Reinsurance ceded -39.7 -26.4Premium income for own account 982.4 1,221.5
4242
SpareBank 1 LivsforsikringProfit/loss per portfolio
Figures in MNOKGroup
portfolio
Previouslyestablished
individual productsInvestment choice
portfolioCompanyportfolio Total
Risk result 89.8 -2.6 -0.3 0.0 86.9Administration result 10.7 -11.5 -36.5 0.0 -37.3Net investment result -28.5 -22.2 0.0 0.0 -50.8Transferred to policyholders -8.4 0.0 -0.5 0.0 -8.9Return on company's assets 0.0 0.0 0.0 34.4 34.4Sum 63.5 -36.3 -37.3 34.4 24.4
4343
Tax matters I - SpareBank 1 Livsforsikring – Realised gains and losses
4444
• The tax exemption method (Section 2-38 of the Tax Act (Norway)):For investments in shares and share-related securities, realised gains are exempt from tax and losses are not deductible
• For investments in companies resident in a low tax EEA country, income is nevertheless liable for taxation if the company ”is not established in real terms and in real terms conducts financial activity in the country”(Section 2-38 of the Tax Act, 3rd subsection, letter a – amendment to the law applicable from 1 January 2008)- Means that for SICAV funds registered in Luxemburg and Ireland,
income is taxed, whilst losses are not deductible
• As a consequence, the tax cost is higher than the normal rate of 28 % in the event of losses in the share portfolio and lower tax cost than the normal rate in the event of gains in the share portfolio (with the exception of SICAV funds).(In 2007 the tax cost was reduced by MNOK 285 as a result of the tax exemption method)
Tax matters II - SpareBank 1 Livsforsikring– Unrealised gains and losses
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• Within the group portfolio (traditional life assurance):- If the company has a securities adjustment reserve (the market value is
greater than cost price for assets measured at fair value) unrealised value changes will not have any effect for tax purposes,
because there will be a reverse entry in the securities adjustment reserve- If there is no securities adjustment reserve, the value change will have to be treated as a ”permanent difference” (because laterrealisation at current value will not entail any change in the taxbasis – as would have been the case for a ”temporary difference”)The consequence is that an impairment in value entails a higher tax cost
and an increase in value entails a lower tax cost than the normal rate of 28 %
• Within the investment choice portfolio (unit linked and ITP):- Value changes have no effect for tax purposes because there will be a reverse entry in the size of the insurance liabilities
Tax cost in SpareBank 1 Gruppen’s consolidated accounts as at 31 March 2009
Skatte-(Beløp i mill.kr.) Skatte- kostnad
g runnlag -28 %
Resultat før skatt i Liv 24,4 6,8Kollekt iv- og selskapspo rteføljen :Realiserte tap 78,9 22,1Urealisert verdiendring (tap) 99,9 28,0Investeringsvalgporte føljen:Realiserte tap 66,9 18,7
270,1 75,6I konsernregnskapet:Bruk av tilleggsavsetninger 42,3 11,8
312,4 87,4
MNOK
Pre-tax profit in SpareBank 1 LivsforsikringGroup and company portfolio:Realised losses Unrealised value changes (loss)Investment choice company portfolio:Realised losses
In consolidated accounts:Use of additional provisions
Tax base Tax costs
4646
SpareBank 1 SkadeforsikringPortfolio growth of 4.0 % last 12 months
Portfolio RM (excl. group home) Portfolio CM
2,655
2,725
30.515.6
-10,6
34,5
2,5802,6002,6202,6402,6602,6802,7002,7202,740
Q12008
ChangeQ2
2008
ChangeQ3
2008
ChangeQ4
2008
ChangeQ1
2009
Q12009
MN
OK
Total RM portfolio Change in RM portfolio
654
593
19.2
11.616.7
12.6
560570580590600610620630640650660
Q12008
ChangeQ2
2008
ChangeQ3
2008
ChangeQ4
2008
ChangeQ1
2009
Q12009
MN
OK
Total CM portfolio Change in CM portfolio
10.1 % growth last 12 months2.6 % growth last 12 months
* Overall portfolio growth incl. group home last 12 months equals 2.9 %
4747
Key figures SpareBank 1 Gruppen with subsidiaries
1) All figures are stated in MNOK
2) All figures are quarterly, except for where otherwise stated
3) Following entry into force of new activities act on 1 January 2008, these benchmark figures are not relevant
Figures in MNOK 1) & 2)Q1
2009Q4
2008Q3
2008Q2
2008Q1
2008Q4
2007Q3
2007Q2
2007Q1
2007GroupCapital adequacy ratio 14.5 % 12.6 % 12.0 % 13.0 % 12.6 % 13.1 % 11.3 % 11.6 % 12.5 %Core capital adequacy ratio 9.8 % 9.4 % 9.0 % 9.0 % 9.2 % 9.6 % 7.9 % 8.1 % 9.0 %Net profit acc. 5.2 -857.7 221.5 211.1 63.7 309.0 275.6 352.6 241.3
Life insuranceGross due premium income 956.5 704.7 697.2 721.0 1,019.4 822.9 844.6 1,596.5 1,186.4 Retail 280.1 285.5 267.5 283.1 287.4 413.0 462.6 1,226.9 510.6 Corporate 676.4 419.2 429.7 437.9 732.0 410.0 382.1 369.6 675.8Investment result 3) - - - - 0.0 199.0 224.5 407.6 138.6Value adjusted return on assets 3) - - - - 0.0 % 0.6 % 0.7 % 3.7 % 1.4 %Total assets 21,237 21,217 22,287 23,059 22,909 23,998 23,574 23,641 22,711Capital adequacy ratio 15.1 % 14.3 % 14.8 % 14.8 % 12.5 % 12.5 % 10.8 % 11.3 % 12.0 %
P&C insuranceNet earned premium 919.2 935.0 931.5 908.5 902.6 900.0 890.7 872.7 853.4 Retail 804.2 822.8 815.5 798.7 791.2 791 787.44 771.6 755.3 Corporate 91.0 89.9 90.5 85 87.6 88.0 85.7 -1444.4 1608.82 Reinsurance 24.0 22.3 25.5 24.7 23.8 20.0 17.6 1545.5 -1510.72Net financial income 65.8 -72.0 8.9 91.8 8.4 102.0 85.2 119.8 70.7Return on financial assets 0.70 % -0.97 % 0.12 % 1.27 % 0.11 % 1.41 % 1.22 % 1.79 % 1.09 %Claims Ratio, net 79.5 % 69.7 % 74.1 % 70.3 % 74.2 % 74.0 % 72.4 % 74.6 % 76.7 %Cost Ratio, net 21.1 % 23.3 % 20.9 % 23.5 % 19.7 % 21.8 % 19.5 % 20.7 % 21.2 %
Bank 1 OsloNet interest income 88.8 89.9 105.3 95.9 96.7 97.0 90.4 83.0 77.5Net loan loss provisions 34.9 50.186 31.8 -13.2 -3.8 -3 -3 -2.6 -1.4Loans 21,030 20,688 20,261 19,574 18,844 18,089 17,112 16,483 15,655 Retail 14,655 14,340 13,983 13,574 12,745 12,415 11,981 11,602 11,121 Corporate 6,376 6,348 6,279 6,000 6,098 5,674 5,131 4,880 4,534Deposits 15,914 15,925 14,122 14,681 13,578 13,378 13,550 13,325 13,055Capital adequacy ratio 11.6 % 8.0 % 9.3 % 9.9 % 11.4 % 10.0 % 9.8 % 9.8 % 10.6 %Net interest income/average totalt assets 1.41 % 1.48 % 1.82 % 1.81 % 1.86 % 1.92 % 1.85 % 1.78 % 1.76 %Return on equity acc. (parent bank) 4.7 % 1.7 % 6.7 % 10.1 % 9.5 % 9.3 % 10.2 % 9.5 % 8.0 %Return on equity acc. (group) 4.4 % -1.2 % 5.3 % 8.7 % 8.1 % 8.10 %
ODINAssets under management 17,431 19,163 23,581 30,508 31,400 37,800 45,600 51,100 46,900Equity fund market share 13.1 % 13.8 % 13.7 % 14.6 % 15.6 % 15.9 % 18.9 % 20.6 % 21.0 %
4848
Premises for calculating the pension liability in SpareBank 1 Gruppen
4949
31.03.2009 31.03.2008 31.12.2008Discount rate 3.80 % 4.80 % 3.80 %Basic amount adjustment/inflation 3.75 % 4.25 % 3.75 %Wage adjustment 4.00 % 4.25 % 4.00 %Expected return on pension funds 5.80 % 5.80 % 5.80 %AFP early retirement plan 40 % 40 % 40 %Pension adjustments 1.50 % 2.30 % 1.50 %
Mortality K2005 K2005 K2005Disability IR2003 IR2003 IR2003
Cancellations4 % below 50
years and 2 %above 50 years
4 % below 50years and 2 %
above 50 years
4 % below 50years and 2 %
above 50 years
• SpareBank 1 Gruppen at all times shows the market value of the pension liability in the balance sheet
• SpareBank 1 Gruppen applies a new scale K2005