First Quarter Result 2010 Telephone conference 28 April 2010
Disclaimer This presentation contains forward-looking statements that reflect management’s current views with respect to certain future events and potential financial performance. Although Nordea believes that the expectations reflected in such forward looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, results could differ materially from those set out in the forward- looking statements as a result of various factors. Important factors that may cause such a difference for Nordea include, but are not limited to: (i) the macroeconomic development, (ii) change in the competitive climate, (iii) change in the regulatory environment and other government actions and (iv) change in interest rate and foreign exchange rate levels. This presentation does not imply that Nordea has undertaken to revise these forward- looking statements, beyond what is required by applicable law or applicable stock exchange regulations if and when circumstances arise that will lead to changes compared to the date when these statements were provided. 2 28 April 2010 Telephone conference
Strong first quarter results Total expenses down 5%* Loan losses 37bps Total income up 7% Q1 2009 Q4 2009 Q1 2010 Q1 2009 Q4 2009 Q1 2010 Q1 2009 Q4 2009 Q1 2010 Risk-adjusted profit up 27% Operating profit up 48% Return on Equity 11.3% Q1 2009 Q4 2009 Q1 2010 Q1 2009 Q4 2009 Q1 2010 Q1 2009 Q4 2009 Q1 2010 *Down 2% - adjusting for restructuring expenses in Q4 and changes in exchange rates 3 28 April 2010 Telephone conference
Operating profit high and stable Operating profit, EURm 1.078 978 932 895 885 883 878 847 833 832 818 781 592 Q1/07 Q2/07 Q3/07 Q4/07 Q1/08 Q2/08 Q3/08 Q4/08 Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Operating profit Loan losses Write backs 4 28 April 2010 Telephone conference
Continued delivery on long-term targets Risk-adjusted profit TSR 2007 - Q1 2010 - on track to reach 2013 target 20 2% 0 38.9% 38.0% -20 -40 Top quartile -60 -80 -100 Allied Irish Banks Bank of Ireland Intesa Sanpaolo Commerzbank Lloyds Swedbank Unicredit Societe Generale Barclays DnBNOR Nordea Bank Santander RBS Erste Group Danske BBVA BNP Paribas SHB KBC SEB Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q4/08 Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Rolling four quarter compared with FY 2006 EUR 1 ,957m Long-term target for average yearly growth ¹Nordic peers: Danske Bank, DnB NOR, SEB, SHB, Swedbank 5 28 April 2010 Telephone conference
Outlook 2010 � Nordea expects the macro economic recovery to continue in 2010, but the development is still fragile and hence uncertainty remains � Excluding currency effects in 2010, cost growth is expected to be broadly in line with 2009 – including the effects from growth and efficiency initiatives � As previously stated, risk-adjusted profit is expected to be lower in 2010 compared to 2009, due to lower income in Treasury and Markets � However, net loan losses in 2010 are likely to be lower than in 2009. Credit quality continues to stabilise, in line with the macroeconomic recovery 6 28 April 2010 Telephone conference
First Quarter Results Telephone conference 28 April 2010 7
Result highlights EURm Q1/10 Q4/09 Chg % Q1/09 Chg % Net interest income 1,235 1,299 -5 1,356 -9 Net fee and commission income 475 463 3 381 25 Net result from items at fair value 548 351 56 515 6 Other income 45 45 0 27 67 Total income 2,303 2,158 7 2,279 1 Staff costs -687 -702 -2 -665 3 -1,164 -1,219 -5¹ -1,090 7² Total expenses Profit before loan losses 1,139 939 21 1,189 -4 Net loan losses -261 -347 -25 356 -27 Operating profit 878 592 48 833 5 Net profit 643 447 44 627 3 Risk-adjusted profit 678 533 27 747 -9 ¹ Down 2% - adjusting for restructuring expenses in Q4 and changes in exchange rates 8 28 April 2010 Telephone conference ² Up 3% – adjusting for changes in exchange rates
Underlying business trends Q1 2010 with Q1 2010 with unchanged unchanged translation translation Reported EURm Q1 2010 Q4 2009 Chg % Chg % Chg % currencies currencies change% (compared with (compared Q4 2009) with Q1 2009) Total operating income 2,303 2,158 7 2,252 4 2,239 -2 1 Total operating -1,164 -1,219 -5 -1,129 -7 -1,119 3 7 expenses Profit before loan 1,139 939 21 1,123 20 1,120 -6 -4 losses Operating profit 878 592 48 866 46 865 4 5 9 28 April 2010 Telephone conference
Net interest income – down 5% from high levels � Remains subdued by the low interest EURm rate levels 1,356 1,321 1,305 1,299 1,235 � Underlying increase in customer operations – volumes and margins � Decrease in Group Treasury � Negative impact from day count � Total lending up 4% � Continued increase in corporate lending margins Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 10 28 April 2010 Telephone conference
Underlying volume trends % change in local currency Q1oQ4 Q1oQ1 Total Lending, excl. reversed repurchase agreements 2% 2% – Nordic household mortgages 2% 9% – Nordic consumer lending 3% 8% – Nordic corporates 2% -5% – New European Markets -3% -4% – FID and Shipping 4% -7% Total Deposits, excl. repurchase agreements 0% -2% – Nordic households 2% 4% – Nordic corporates -2% -5% – New European Markets -12% 4% – FID and Shipping -5% -37% 11 28 April 2010 Telephone conference
Change in net interest income Q1oQ4 YoY Volume driven Nordic markets local currencies 12 10 Corporate lending volumes 2 -22 Household lending volumes 9 29 Corporate deposit volumes 0 0 Household deposit volumes 0 2 Margin driven Nordic markets local currencies 10 -86 Corporate lending margins 14 58 Household lending margins 5 -19 Corporate deposit margins -3 -42 Household deposit margins -7 -83 Lower return on allocated capital, FX effects and other -70 -1 Nordic Banking -48 -77 Institutional & International Banking 5 18 Other, incl. Group Treasury -21 -62 Total -64 -121 12 28 April 2010 Telephone conference
Interest rate sensitivity - 3 components Increased market rates, 100bps Q1/10 Q1/09 � Structural interest income risk (SIIR) EURm � Reflecting the effect on NII from re- Net Interest Income, approx 450 400 pricing gaps* Net result from items at fair value, � Dynamic effects on net interest income -100 -250 approx � Changes in deposit margins – mainly Total annualised income effect 350 150 transaction accounts � Market risk in the interest bearing investment portfolios � Market risk has an immediately effect on the line net result from items at fair value * Accumulated mismatch between assets and liabilities with an interest rate duration of less than 12 months, with the assumptions that non-maturity accounts are re- priced immediately following a interest rate change, without effecting margins 13 28 April 2010 Telephone conference
Positive trend continues - Net fee and commission income up 3% � Strong performance in savings area EURm 475 463 � Asset management commissions 437 412 up 6% from a strong Q4 381 � Lending commissions up 8% � Payment commissions up 7% � Commission expenses for state schemes largely unchanged at EUR 51m Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 14 28 April 2010 Telephone conference
Asset under Management at record level Asset under Management (AuM), EURbn � AuM EUR 169bn 169 158 157 � Up 7% or EUR 11.2bn in Q1 126 � Net inflow EUR 3.1bn – 8% annualised 2007 2008 2009 Q1 2010 � Increased market shares Net flows AuM, EURbn 3.5 3.1 2.9 2.8 0.9 Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Nordic Retail funds European Fund Distribution Nordic Private Banking International Private Banking Institutional customers Life & Pension 15 28 April 2010 Telephone conference
Strong demand for risk management products Net result from items at fair value, � Capital markets activities in EURm customer areas continues to 594 perform 548 515 486 � Underlying corporate demand for fixed income and FX products stabilising 351 325 � High demand for credit bonds from 284 institutional clients 221 198 � Increase in Group Treasury � Continued strong Life & Pensions results Q1/08 Q2/08 Q3/08 Q4/08 Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Nordic Banking & IIB Total Net gains/losses 16 28 April 2010 Telephone conference
Total expenses according to plan EURm � Underlying expenses down 2% - 1 219 adjusting for restructuring expenses 1 164 1 116 1 090 1 087 in Q4 and changes in exchange rates 471 438 392 394 382 � Up 3% compared Q1 2009 702 687 687 665 670 � Underlying staff costs up 1% in Q1 � Number of employees increased by 130 � Cost/income ratio improved to 51% (56%) Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Staff costs Other expenses 17 28 April 2010 Telephone conference
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