Annual General Meeting of Shareholders 26 April 2019 1 Corporate - - PowerPoint PPT Presentation

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26 April 2019

Annual General Meeting of Shareholders

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Corporate video ‘Reflections’

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Wim van den Goorbergh Chairman

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AGENDA

1) Opening remarks and announcements 2) Annual report 2018 – Discussion item a) Report of the Managing Board b) Report of the Supervisory Board c) Corporate Governance d) Implementation of the remuneration policy in 2018 3) Annual accounts 2018 – Voting item a) Proposal to adopt the 2018 financial statements b) Proposal to distribute a total dividend of EUR 0.86 per

• rdinary share, resulting in a final dividend of EUR 0.36 per
• rdinary share

4) Discharge – Voting item a) Proposal to discharge the Managing Board b) Proposal to discharge the Supervisory Board 5) Proposal to amend the remuneration of the members of the Supervisory Board – Voting item 6) Composition of the Supervisory Board: appointment of Supervisory Board member a) Opportunity to make recommendations for the appointment of a member of the Supervisory Board – Discussion item b) Proposal to reappoint Mr Christner as member of the Supervisory Board – Voting item 7) Issuance and repurchase of shares – Voting item a) Proposal to authorize the Managing Board to issue shares b) Proposal to authorize the Managing Board to restrict or exclude pre-emptive rights c) Proposal to authorize the Managing Board to repurchase shares 8) Proposal to reappoint Ernst & Young as auditor for the financial year 2019 – Voting item 9) Any other business 10) Closing

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Agenda item 1 Opening

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OPENING REMARKS AND ANNOUNCEMENTS

▪ Welcome ▪ English translation available, which will also be published on the website Number of votes ▪ On the record date, 29 March 2019, the issued capital of the company consisted of 147,513,369 ordinary shares ▪ 1,045,599 ordinary shares are held by NIBC Holding N.V. as treasury shares. No votes may be cast on treasury shares ▪ The total number of voting rights which can be cast at the AGM equals to 146,467,770 ▪ Number of votes present at the AGM is 126,167,752

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VOTING INSTRUCTIONS

▪ All shareholders present received a voting form ▪ Proxies have been given to Allen & Overy before the AGM and votes were casted electronically before the AGM ▪ These are both represented by Allen & Overy, which results in the majority vote being represented by A&O ▪ Please complete on your voting form how you would like to vote for each voting item ▪ Return voting form to Company Secretary after the meeting ▪ Detailed voting results will be made available on the website as soon as possible

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Agenda item 2a Annual Report 2018

Report of the Managing Board Discussion item

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Paulus de Wilt CEO

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REFLECTING ON THE WORLD AROUND US

Softer economic conditions ahead

BUSINESS CONFIDENCE LEVEL SEEMS TO HAVE PEAKED2

SOLID ECONOMIC DEVELOPMENTS IN THE NETHERLANDS AND GERMANY1 DUTCH ECONOMY, SOLID FUNDAMENTALS…

▪ International, highly competitive economy ▪ Housing price increase ▪ Low un-employement

…BUT INTERNATIONAL CHALLENGES REMAIN:

▪ Interest rate environment: low for even longer ▪ Brexit deadline is nearing, yet uncertainty remains ▪ International trade tensions, particularly between the US and China ▪ Turn of the (economic) cycle?

2 4 6 8

2015 2016 2017 2018

NL GDP (%) GE GDP (%) NL Unemployment (%) GE Unemployment (%) 99 100 101 102 103

2015 2016 2017 2018 2019

NL GE

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CORPORATE CLIENT OFFERING

Record origination and active rebalancing leading to stable, more granular portfolio

9.9bn

▪ Leveraged Finance reduced by EUR 220 mln, but

• ff-balance activities increased through EUR

450 mln CLO ▪ Reduction of equity portfolio: Sale of NEIF leading to a one-off result and significant reduction of RWAs ▪ Growth in more granular portfolios like Leasing (BEEQUIP, +52%) and receivable finance (+23%) ▪ Expansion to Nordics STRONG NET PROMOTOR SCORE (NPS)

CORPORATE LOAN ORIGINATION REBALANCING FACTS AND FIGURES

INCREASED ORIGINATION WELL DIVERSIFIED CORPORATE CLIENT EXPOSURE

63% C+

/PRIME

72

/OUTPERFORMER

3.7bn

In EUR bn

3,1 3,1 3,7 2016 2017 2018

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RETAIL CLIENT OFFERING

Record origination fuelling both on- and off-balance mortgage portfolio

9.3bn

LOW RISK PORTFOLIO

▪ On-balance portfolio growth of ± EUR 0.4 billion ▪ Growth of owner-occupied portfolio of 5%, with Loan-to-Value (LTV) of 72% ▪ Moderate growth in Buy-to-Let (+2.5%), with LTV

• f 52%

▪ Strong growth OTM portfolio from EUR 0.7 billion to EUR 2.4 billion NIBC DIRECT CUSTOMER SURVEY SCORE SAVINGS

MORTGAGE LOAN ORIGINATION GROWTH FACTS AND FIGURES

MATURE GRANULAR MORTGAGE PORTFOLIO

7.7 3.4bn

NIBC DIRECT CUSTOMER SURVEY SCORE MORTGAGES

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CAMPAIGNS

▪ NIBC Direct 10yr Anniversary ▪ Dutch television in ‘Heel Holland Bakt’ ▪ ‘Aflossingsblij’

MORTGAGE LOAN PORTFOLIO

In EUR bn

8,0 8,2 8,6 0,4 0,6 0,6 0,4 0,3 0,7 2,4 8,8 9,8 11,6 2016 2017 2018

Owner-occupied Buy-to-let Fair value adjustment Originate-to-manage

INCREASED ORIGINATION

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REFLECTING ON OUR STRATEGIC PRIORITIES

1 2 3 4 5 6 Continuous evolution of client franchise, expertise and propositions

▪ Record origination on corporate client side in combination with active rebalancing leads to stable corporate client portfolio ▪ Record production for on- and off balance exposure on retail client side: NIBC is well positioned for changing consumer behaviour

Focus on growth of asset portfolio in core markets

▪ 52% growth in lease receivables ▪ 23% growth in receivables finance offering, supporting for example iwoca, Ratepay ▪ On-balance growth of mortgages of ± EUR 400 million

Diversification of income

▪ Increased OTM mandate to EUR 3.5 billion. Drawn portfolio at 2.4 billion ▪ Diversified LF offering to off-balance with successful closing of EUR 450m North Westerly V CLO ▪ Markets business still challenging

Building on existing agile and effective organisation

▪ Strategic investments made in various fintechs ▪ Permanent and increased focus on ‘Know Your Customer’ (KYC) and Anti-Money Laundering results in further strengthening of processes on both sides of the business

Further optimisation of capital structure and diversification of funding

▪ Sustainably lowered funding costs from 87 to 73bps ▪ Further RWA reduction by 9% ▪ CETI ratio further strengthened to 18.5%, well above medium-term objective ▪ Total dividend of EUR 126 million (EUR 0.86 per share)

Ongoing investment in people, culture and innovation

▪ IMD and McKinsey to gain outside-in view ▪ High personnel turnover (-18%) due to active rebalancing of the organisation ▪ Bank-wide ‘Virgin Pulse’ Vitality program ▪ Continued talent investments leads to record year for trainees, with large well diversified group ▪ Over EUR 3,000 training expenses per employee

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Herman Dijkhuizen CFO

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SHARE PRICE DEVELOPMENT

NIBC SHARE PRICE NIBC INDEXED PEER COMPARISON

65 70 75 80 85 90 95 100 105 110 115 23-03-18 06-04-18 18-04-18 30-04-18 11-05-18 23-05-18 04-06-18 14-06-18 26-06-18 06-07-18 18-07-18 30-07-18 09-08-18 21-08-18 31-08-18 12-09-18 24-09-18 04-10-18 16-10-18 26-10-18 07-11-18 19-11-18 29-11-18 11-12-18 21-12-18 07-01-19 17-01-19 29-01-19 08-02-19 20-02-19 04-03-19 14-03-19 26-03-19 05-04-19 17-04-19 NIBC ING ABN v.Lanschot AEX

TRADING VOLUME

7,80 8,00 8,20 8,40 8,60 8,80 9,00 9,20 9,40 9,60 March May July September November January 01-02-19 05-02-19 07-02-19 11-02-19 13-02-19 15-02-19 19-02-19 21-02-19 25-02-19 27-02-19 01-03-19 05-03-19 07-03-19 11-03-19 13-03-19 15-03-19 19-03-19 21-03-19 25-03-19 27-03-19 29-03-19 02-04-19 04-04-19 08-04-19 10-04-19 12-04-19 16-04-19 18-04-19 24-04-19 500 1.000 1.500 2.000 2.500 3.000 01-02-19 05-02-19 07-02-19 11-02-19 13-02-19 15-02-19 19-02-19 21-02-19 25-02-19 27-02-19 01-03-19 05-03-19 07-03-19 11-03-19 13-03-19 15-03-19 19-03-19 21-03-19 25-03-19 27-03-19 29-03-19 02-04-19 04-04-19 08-04-19 10-04-19 12-04-19 16-04-19 18-04-19 24-04-19 Thousands

From IPO date till 25 April 2019

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INCOME STATEMENT

Continued strong profitability in FY 2018

104 160 173 53 44 213 217 11,9% 13,6% 6,0% 9,0% 10,8% 2016 2017 2018

Non-recurring profit Profit after tax Return on equity Return on equity ex. non-recurring

IFRS 9 2018 IFRS 9

• ex. non-

recurring 2018 IAS 39 2017 IAS 39 ex. Vijlma 2017

Net interest income 427 427 342 354 Net fee and commission income 51 51 54 54 Investment income 74 37 67 67 Other income (1) (1) 96 (2) Operating income 551 513 559 473 Personnel expenses 108 102 111 111 Other operating expenses 111 107 102 98 Depreciation and amortisation 5 5 6 6 Regulatory charges 15 15 14 14 Operating expenses 239 230 233 229 Net operating income 312 284 326 244 Credit loss expense / (recovery) 54 54 56 55 Tax 29 45 54 26 Profit after tax 229 185 216 163 Profit attributable to non- controlling shareholders 12 12 3 3 Profit after tax attributable to shareholders of the company 217 173 213 160

▪ Profit after tax attributable to shareholders of the company in 2018 of EUR 217 million and return on equity at EUR 13.6% ▪ Excluding non-recurring in 2018 and the result on Vijlma in 2017: ▪ Profit after tax attributable to shareholders of the company increased by 8% to EUR 173 million mainly driven by net interest income on the back

• f lower funding costs

▪ Return on equity (ROE) increased by 20% to 10.8% compared to 9.0% in 2017 ▪ ROE in 2017 was based on the pre-IFRS 9 equity base, which was substantially higher ▪ The profitability improvement in 2018 reflects the investments made in prior years PROFIT AFTER TAX AND RETURN ON EQUITY INCOME STATEMENT COMMENTS

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INCOME STATEMENT

Continued strong profitability in FY 2018

49% 42% 43% 49% 48% 45% 2016 2017 2018

Cost/income ratio Cost/income ratio ex. non-recurring

292 354 427 2,11% 1,47% 1,64% 1,84% 2016 2017 2018

Net interest income (€m) Net interest margin Net interest margin ex. IFRS 9

NET INTEREST INCOME FURTHER IMPROVEMENT OF COST/INCOME

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CAPITAL AND FUNDING

STRONG DIVIDEND PAY-OUT 2018

…

25 96 89 37 126 25% 45% 58% 50% 2016 2017 2018

Second (special) interim dividend (€m) Dividend (€m) Pay-out ratio Pay-out ratio ex. second (special) interim dividend

STRONG TIER 1 RATIO

9% 43% 21% 11% 16% Shareholders equity Retail funding Secured (wholesale) funding ESF deposits Unsecured (wholesale) funding

DIVERSIFIED FUNDING WITH LONGER MATURITIES LATEST FUNDING TRANSACTION APRIL 2019 ▪ 5 years non preferred EUR 300 million 18.5%

31 December 2018 IFRS 9

CET 1 SREP 10.6% 14%

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SUMMARISING OUR PERFORMANCE…

Delivering upon our promises

Note: Financials for NIBC Holding as of FY 2018, unless otherwise stated. All comparison figures of FY 2017 include the results from Vijlma.

METRICS MEDIUM-TERM OBJECTIVES1 FY 2018 Return on Equity (Holding) Cost-to-income (Holding) CET1 (Holding) Dividend pay-out (Holding) Rating (Bank) 10 - 12% < 45% ≥ 14% ≥ 50% BBB+ 13.6% 43% 18.5% 58% BBB Positive Outlook

≈ ✓ ✓ ✓ ✓

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Agenda item 2a Annual Report 2018

Report of the Managing Board Discussion item

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Agenda item 2b Annual Report 2018

Report of the Supervisory Board Discussion item

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REPORT OF THE SUPERVISORY BOARD 2018

▪ Strong results in profit, product portfolio and client franchise in both retail and corporate client offering ▪ Listing of NIBC Holding in March 2018 raised public profile ▪ Four Supervisory Board Committees that prepare discussions and decisions of the Supervisory Board:

• Audit Committee
• Risk Policy & Compliance Committee
• Remuneration & Nominating Committee
• Related Party Transaction Committee

Name Year of birth Nationality Member since End of term Committee memberships

Mr W.M. van den Goorbergh (Chair) 1948 Dutch 2005 2019 AC, RPCC, RNC, RPTC Mr D.M. Sluimers (Vice-Chair) 1953 Dutch 2016 2020 AC, RPCC, RNC Mr R.L. Carrión 1952 American 2017 2021 RPCC Mr M.J. Christner 1972 German 2011 2019 AC Mr J.C. Flowers 1957 American 2012 2020

• Ms A.G.Z. Kemna

1957 Dutch 2018 2022 AC, RPCC, RPTC Ms S.M. Zijderveld 1969 Dutch 2018 2022 RNC, RPTC

Changes to Supervisory Board in 2018 ▪ Two new members joined: Mrs Kemna and Mrs Zijderveld ▪ Two members left: Mr Veenhof and Mr de Jong Changes to Supervisory Board in 2019 ▪ See agenda item 6

Please refer to Supervisory Board report in Annual Report 2018 (p 94 – 104)

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Agenda item 2c Annual Report 2018

Corporate Governance Discussion item

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CORPORATE GOVERNANCE

Please refer to Corporate Governance Section in Annual Report 2018 (p 105 – 109)

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Agenda item 2d Annual Report 2018

Implementation of the remuneration policy in 2018 Discussion item

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REMUNERATION 2018

Please refer to Remuneration Report in Annual Report 2018 (p 110-115)

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Agenda item 3a Annual Accounts 2018

Proposal to adopt the 2018 financial statements Voting item

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Q&A EXTERNAL AUDITOR

▪ Intro by Ernst & Young Accountants LLP ▪ Questions to Ernst & Young Accountants LLP

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ADOPTION OF AUDITED ANNUAL FINANCIAL STATEMENTS

Please refer to Annual Financial Statements in the Annual Report 2018

▪ Voting item

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Agenda item 3b Annual Accounts 2018

Proposal to distribute a total dividend of EUR 0.86 per ordinary share Voting item

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APPROVAL OF DIVIDEND

▪ Voting item

Approve a total dividend of EUR 0.86 per ordinary share, resulting in a final dividend of EUR 0.36 per

• rdinary share

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Agenda item 4a Discharge

Proposal to discharge the Managing Board Voting item

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DISCHARGE

▪ Voting item

Discharge the members of the Managing Board for the exercise of their respective duties during the financial year 2018

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Agenda item 4b Discharge

Proposal to discharge the Supervisory Board Voting item

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DISCHARGE

▪ Voting item

Discharge the members of the Supervisory Board (including for the avoidance of doubt the members who resigned during financial year 2018) for the exercise of their respective duties during the financial year 2018

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Agenda item 5 Proposal to amend the remuneration of the members

• f the Supervisory Board

Voting item

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REMUNERATION SUPERVISORY BOARD

It is proposed that the remuneration for members of the Supervisory Board will be adjusted in line with the Managing Board remuneration based on the three year average merit increases of employees of NIBC (excluding MB).

Please refer to SB Remuneration Policy

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REMUNERATION MEMBERS OF THE SB

▪ Voting item

Approve a yearly adjustment of the remuneration of the Supervisory Board based on the three year average merit increases of employees of NIBC (excluding MB)

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Agenda item 6 Composition of the Supervisory Board: appointment of Supervisory Board member

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COMPOSITION SUPERVISORY BOARD

Changes to Supervisory Board in 2019: ▪ Mr van den Goorbergh to resign at the end of his term after this AGM ▪ Mr Sluimers appointed as Chair of the SB ▪ Vacancy for Chair AC ▪ End of second term of Mr Christner at this AGM

Name Year of birth Nationality Member since End of term Committee memberships

Mr W.M. van den Goorbergh (Chair) 1948 Dutch 2005 2019 AC, RPCC, RNC, RPTC Mr D.M. Sluimers (Vice-Chair) 1953 Dutch 2016 2020 AC, RPCC, RNC Mr R.L. Carrión 1952 American 2017 2021 RPCC Mr M.J. Christner 1972 German 2011 2019 AC Mr J.C. Flowers 1957 American 2012 2020

• Ms A.G.Z. Kemna

1957 Dutch 2018 2022 AC, RPCC, RPTC Ms S.M. Zijderveld 1969 Dutch 2018 2022 RNC, RPTC

Independent SB members Representatives of majority shareholder

Mr van den Goorbergh Mr Sluimers Mrs Kemna Mrs Zijderveld Mr Carrión Mr Christner Mr Flowers

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Agenda item 6a Composition of the Supervisory Board: appointment of Supervisory Board member

Opportunity to make recommendations for the appointment of a member of the Supervisory Board Discussion item

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Agenda item 6b Composition of the Supervisory Board: appointment of Supervisory Board member

Proposal to reappoint Mr Christner as member of the Supervisory Board Voting item

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RE-APPOINTMENT OF MR CHRISTNER

The proposed re-appointment is for a term starting as per the date of this AGM and ending immediately after the AGM to be held in 2021

It is proposed to re-appoint Mr Christner as member of the SB

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RE-APPOINTMENT OF MR CHRISTNER

▪ Voting item

Re-appoint Mr Christner until AGM of 2021

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Agenda item 7a Issuance and repurchase of shares

Proposal to authorize the Managing Board to issue shares Voting item

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ISSUANCE AND REPURCHASE OF SHARES

It is in the interest of the company that it should be in a position to react promptly when business opportunities arise that require the issuance of

• rdinary shares

▪ Up to a maximum of 10% of the total issued ordinary shares at the time the authority is used for the first time plus a further 10% of the total issued

• rdinary shares in connection with or at the occasion an issue occurs as part of a merger or acquisition, or if necessary in the opinion of the

Managing Board and Supervisory Board to safeguard or conserve the capital position of NIBC ▪ For a period of 18 months ▪ Subject to the approval of the Supervisory Board ▪ Subject to regulatory approval where relevant

The authorisation of the Managing Board to issue shares

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▪ Voting item

Authorisation of the Managing Board to issue shares

ISSUANCE AND REPURCHASE OF SHARES

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Agenda item 7b Issuance and repurchase of shares

Proposal to authorize the Managing Board to restrict or exclude pre-emptive rights Voting item

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ISSUANCE AND REPURCHASE OF SHARES

▪ For a period of 18 months ▪ Subject to the approval of the Supervisory Board

The authorisation of the Managing Board to restrict or exclude pre-emptive rights in connection with the issue authorisation granted under agenda item 7a

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▪ Voting item

Authorisation of the Managing Board to restrict of exclude pre-emptive rights

ISSUANCE AND REPURCHASE OF SHARES

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Agenda item 7c Issuance and repurchase of shares

Proposal to authorize the Managing Board to repurchase shares Voting item

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ISSUANCE AND REPURCHASE OF SHARES

▪ Up to a maximum of 10% of the total issued ordinary shares as per 23 March 2018 ▪ For a period of 18 months ▪ Subject to the approval of the Supervisory Board ▪ Subject to regulatory approval where relevant

The authorisation of the Managing Board to repurchase shares

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▪ Voting item

Authorisation of the Managing Board to repurchase shares

ISSUANCE AND REPURCHASE OF SHARES

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Agenda item 8 Proposal to reappoint Ernst & Young as auditor for the financial year 2019

Voting item

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EXTERNAL AUDITOR

▪ The Supervisory Board assessed the relationship with the external auditor after input from the Managing Board and the Audit Committee ▪ Ernst & Young Accountants LLP delivered upon engagement since they were appointed as auditor for the 2016 financial statements ▪ The Supervisory Board proposes to appoint Ernst & Young Accounts LLP as auditor for the financial year 2019

Evaluation

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EXTERNAL AUDITOR

▪ Voting item

Appoint Ernst & Young as external auditor responsible for the financial statements of 2019

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Agenda item 9 Any other business

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ANY OTHER BUSINESS

Q&A

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Agenda item 10 Closing

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CLOSING

▪ Thank you for your attendance ▪ Don’t forget to hand in your voting forms ▪ Please join us for lunch

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26 April 2019

Annual General Meeting of Shareholders