Wholesale Banking – a leading Nordic platform Barclays, New York Erik Ekman, Head of Wholesale Banking
Nordea ●●●
13% CAGR in capital generation 2005-2015, CET 1 ratio improved from 5.9% to 16.5% STRONG CAPITAL GENERATION AND STABLE RETURNS AT LOW RISK 1 43 39 CAGR 1 +13% 37 35 31 29 26 20 19 15 12 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 5.9 2 CET 1 Ratio,% 16.5 1) CAGR 2015 vs. 2005, adjusted for EUR 2.5bn rights issue in 2009. Equity columns represents end-of-period equity less dividends for the year. No assumption on reinvestment rate for paid out Acc. equity, EURbn Acc. dividend, EURbn dividends 2) Calculated as Tier 1 capital excl. hybrid loans 3
Nordea – the most stable bank in the Nordics NORDEA AND PEERS 2006 – Q4 2015, % Quarterly net profit 146 volatility 77 47 38 24 17 Nordea Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Quarterly CET1 1.04 0.88 volatility¹ ratio 0.52 0.35 0.33 0.21 Nordea Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 1) Calculated as quarter on quarter volatility in CET1 ratio, adjusted so that the volatility effect of those instances where the CET1 ratio increases between quarters are excluded 4
Wholesale Banking ●●● An integrated part of the group Wholesale Banking The Way Ahead
Wholesale Banking – in a group perspective Business area contribution, 2015 OPERATING INCOME OPERATING PROFIT ECONOMIC CAPITAL 24% 30% 32% Wholesale banking Rest of Nordea Group 6
Wholesale Banking – a leading Nordic platform GREENWICH PROSPERA 2015 - Tier 1 – Nordea Nordic #1 No. 1 No. 2 No. 3 positions positions positions #1 Nordea 22 12 8 #2 Nordic Peer 14 12 13 #3 Nordic Peer 5 14 13 7
Wholesale Banking – an integrated part of Nordea FOCUSED NORDIC OFFERING Wholesale Personal Banking Banking Customers are served by integrated offering Wealth Commercial & Management Business Banking Group-wide aligned Operations 8
Wholesale Banking – the journey 2011 - 2012 2013 - 2014 2014 - Leveraging the platform o Nordic #1 or within reach, across all major product Transforming the Business model areas business model & culture & culture o Managing for return WB formation WB formation WB formation 9
Wholesale Banking ●●● An integrated part of the group Wholesale Banking The Way Ahead
Wholesale Banking – an overview SIMPLE BUSINESS STRUCTURE FACTS – FY 2015 Revenue 2.4 bn€ Wholesale Banking FTE 3,899 Corporate & Equities FICC WB COO Russia Investment C/I Banking 36% RoCar 13% 11
Wholesale Banking – income split Income from capital light products in focus INCOME SPLIT WHOLESALE BANKING INCOME, H1 2016 50% 45% 40% 35% 38% 30% 25% 20% 62% 15% 10% 5% 0% NII NCI NFV Lending and transaction Capital Markets banking 2011 H1 2016 12
Wholesale Banking – Capital Markets offering Responsible for the total Capital Markets offering in Nordea – but only partly visible in WB P/L TOTAL CAPITAL MARKETS INCOME, mEUR SPLIT BY BUSINESS AREAS (2015-2016) 2000 1800 1600 1400 1200 40% 1000 800 600 60% 400 200 0 2011 2012 2013 2014 2015 2016 Ann. WB Retail 13
Wholesale Banking – cost efficiency COST DEVELOPMENT, mEUR 1050 1000 950 900 850 800 2011 2012 2013 2014 2015 2016 Annualised 14
Wholesale Banking – credit quality CREDIT QUALITY PRUDENTLY MANAGED - EVEN IN STRESSED ENVIRONMENT 0,60% 0,50% 0,40% 0,30% 0,20% 0,10% 0,00% -0,10% 2008 2009 2010 2011 2012 2013 2014 2015 2016 Ann. SOO Russia Corporate 15
Wholesale Banking – managing for return ROCAR DEVELOPMENT, % 16% 12% 8% 4% 0% 2011 2012 2013 2014 2015 2016 Annualised RoCar at unchanged capital Ex xVA Impact 16
Wholesale Banking ●●● An integrated part of the group Wholesale Banking The Way Ahead
Wholesale Banking – a new environment here to stay MACRO REGULATION CAPITAL DIGITALISATION o o o o Low growth, New SREP Foundation negative rates regulation first o Basel IV o o o Capital “Regulatory Customer o markets drift” FRTB interface financing o o o Get ahead of … Embedded the curve compliance o Culture 18
Wholesale Banking – operationalisation of the strategy VALUE CREATION FOR STAKEHOLDERS CUSTOMERS Highest customer satisfaction among STAFF the customers where there is a joint Best of peers to attract, develop and interest for a mutually value creating retain staff partnership SHAREHOLDERS RISK CULTURE Risk and compliance embedded in Managing for return and a meaningful everything we do contribution to Group profit 19
Wholesale Banking - ongoing initiatives EXAMPLES Corporate & Investment Banking o Advisory and capital light o Growth in institutional business FICC and Equities Strategy o Sales offering, smaller inventory o Exchange traded products Capital velocity o Underwritings and syndications o Dynamic allocation COO capabilities o Simplifying and streamlining, efficiencies o New management, organisation and culture “ PEOPLE, PEOPLE, PEOPLE ” 20
Wholesale Banking – a leading Nordic platform Barclays, New York Erik Ekman, Head of Wholesale Banking
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