sparebanken SØR · 2013. 12. 16. · Sparebanken SØR Q2 2013 Key figures - Group Profit and loss...

sparebanken

SØR

%

€ @

Growth Net interest Commission income

Reduced costs Increased losses and doubtful RESULTS

Q2 and 1H 2013

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Where you are

1825 Sparebanken Sør has its origin from 1825, when Arendal Sparebank was set up as one of the first six banks in Norway.

1973 In 1973 the bank merged with 4 other saving s banks in Aust-Agder, and formed Aust-Agder Sparebank.

2013 Sparebanken Sør is an independent savings bank with total assets BNOK 47.1 and 319.4 man-years as at 30. June 2013.

1984 Sparebanken Sør was established in 1984 after a merger between Aust-Agder Sparebank, 2 other savings banks in Aust-Agder and 9 from Vest-Agder.

2007 In 2007 we opened a branch in Bø and 8. October 2008 our first branch in Grenland. In autumn 2012, the bank opened its branch in Skien.

Going forward -> We have supported businesses and people in the region to realize their dreams for more than 180 years, and have thus influenced the local history… As an independent savings bank close to customers and with local decision- making, we will continue to be the most important and best bank for the counties of Agder and Telemark.

Aust Agder 108.000 inhabitants 9.212 square km 12 branches

Telemark 169.000 inhabitants 15.299 square km 7 branches

Vest Agder 172.000 inhabitants 7.276 square km 11 branches

Sparebanken SØR

2

http://no.wikipedia.org/wiki/Fil:VestAgder-kommuner.gif

http://no.wikipedia.org/wiki/Fil:Aust-Agder-kommuner.gif

http://upload.wikimedia.org/wikipedia/commons/7/73/Telemarkkommuner.gif

Highlights

Sparebanken SØR Q2 2013

Solid growth on loans and deposits

Further strengthened net interest and improved lending

margins

Underlying growth in commission income

Cost efficiency gives results

3


Status – The merger with Sparebanken Pluss

Merger

On plan

Resolution

The Competition

Authority

FSA

A hectic spring has passed with progression as planned.

Unanimous decisions on both banks Board of Trustees before summer.

The merger is approved by The Competition Authority.

Expectations of approval from FSA in August/September.

Still expectations of implementation from 1.January 2014.

4


Status - macro

Unemployment

House sales

Bankruptcies

Sq. meter price (detached houses)

5

2010 2011 2012 2013

Telemark Aust Agder Vest Agder Norway

2010 2011 2012 2013

Telemark Aust Agder Vest Agder Norway

2010 2011 2012 2013

Telemark Aust Agder Vest Agder

2010 2011 2012 2013

Telemark Aust Agder Vest Agder


Key figures - Group

Profit and loss Q2 2013 Q2 2012 1H 2013 1H 2012 2012

Net interest and credit commission income

196 167 380 323 705

Net commission income 42 45 76 82 175

Other income 6 2 5 27 70

Operating costs 126 125 250 246 513

Losses on loans, guarantees 31 12 37 23 61

Result ordinary operations 87 77 174 163 376

Valuation of debt 1 30 - 29 - 17 -125

Pre-tax profit 88 107 145 146 251

Balance Sheet 1H 2013 1H 2012 2012

Net loans 38.208 35.406 36.850

Deposits 21.923 20.303 20.999

Total assets 47.088 42.717 44.456

6


Stable profit from underlying operations

Pre-tax profit Adjusted for valuation of debt

Valuation of debt affects positively in Q2, and stable underlying operations. Result adjusted for valuation of debt constitutes 87 MNOK in Q2 2013.

107

54 52 57

88

Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013

77

138

75 87 87

Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013

7


Key figures

9,9

16,3

10,4 8,0

2011 2012 Q2 2012 Q2 2013

Deposit growth

8,4 10,5 9,7 7,9

2011 2012 Q2 2012 Q2 2013

0,21 0,03

0,17 0,08

2011 2012 Q2 2012 Q2 2013

1,23 1,17 1,19 1,08

2011 2012 Q2 2012 Q2 2013

Losses as % of net loans

Lending growth

Cost ratio

* Costs annualized as % of average total assets

8


Profit and loss

919

456

920

471

1H 2012 1H 2013 Q2 2012 Q2 2013

Interest income

596

289 540

275

1H 2012 1H 2013 Q2 2012 Q2 2013

246 125

250 126

1H 2012 1H 2013 Q2 2012 Q2 2013

146 107 145 88

1H 2012 1H 2013 Q2 2012 Q2 2013

Operating costs

Interest costs

Pre-tax profit

9

Sparebanken SØR Q2

32 040 32 850 33 581 34 218 35 406 36 152 36 855 37 394 38 208

17 457 17 911 19 028 19 039 20 303 20 048 20 999 20 165 21 923

54,5 % 54,5 % 56,7 % 55,6 % 57,3 % 55,5 % 57,0 % 53,9 %

57,4 %

Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013

Loans Deposits Deposit coverage

Development deposits - loans

Increased deposit coverage in Q2

* Deposit coverage as % of net loans

10


Lending and deposit margins

1,68 % 1,51 % 1,50 %

2,11 % 2,23 %

2,40 % 2,51 % 2,52 %

2,69 %

0,47 % 0,57 % 0,48 %

-0,05 % -0,22 %

-0,32 % -0,45 %

-0,57 %

-0,59 %

1,25 % 1,18 % 1,13 % 1,33 % 1,34 % 1,43 % 1,43 % 1,44 % 1,50 %

Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013

Lending margins Deposit margins Weighted average

* Margin relative to 3 months NIBOR

Increased lending margins, but still lower deposit margins

1,50 %

11


157 162 153 156 167 187 195 184 196

1,63 % 1,64 %

1,48 % 1,46 %

1,56 %

1,73 % 1,78 %

1,65 %

Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013

Nominal Net interest

1,68 %

Net interest

* Quarterly net interest annualized as % of average total assets

Beginning to see the effects of interest rate adjustments in May

12


Costs

114 115 139 121 125 119 148 125 126

1,18 % 1,16 %

1,34 %

1,13 % 1,17 % 1,10 %

1,35 %

1,12 %

Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013

Nominal Cost ratio

* Quarterly costs annualized as % of average total assets

Efforts to reduce costs continues

1,08 %

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Income

167

45

32

Net interest Comm.income Other income

196

42 7

Net interest Comm.income Other income

Commission income - 6,7 %

Other income - 78,1 %

Net interest + 17,4 %

Q2 2012 Q2 2013

Total 244 MNOK

Total 245 MNOK

14


Lending

Distribution RBM/CM Distribution Corporate Market

30,0 %

70,0 %

CM RBM

48 %

15 %

8 %

6 %

7 % 6 %

4 % 4 % 2 % 0 %

Comm.properties Constructions

Wholesale and retail trade Industry

Financial services Sundry/Other industries

Primary industries Transport

Hotel and restaurant Public sector

Well-diversified portfolio that reflects the business activity in the region. Reduced exposure to Commercial properties and Constructions.

15


Lending distribution – development

58,6 % 61,2 % 64,8 % 67,2 % 68,2 % 69,4 % 70,0 %

41,4 % 38,8 % 35,2 % 32,8 % 31,8 % 30,6 % 30,0 %

24,3 % 21,5 %

16,8 % 15,4 % 14,5 % 14,9 % 14,3 %

2007 2008 2009 2010 2011 2012 Q2 2013

RBM CM Comm.properties

Altered ratio between RBM and CM have reduced the risk in the portfolio

16

62,4 %

18,9 % 18,6 %

67,0 %

18,6% 14,3 %

Lowest/low Medium High/highest

2012 2013

90,6 %

6,6 % 3,0 %

91,9 %

5,3 % 2,8%

Lowest/low Medium High/highest

2012 2013

Risk profile


Portfolio according to risk groups RBM

Portfolio according to risk groups CM

RBM Sør has a high proportion of loans with low risk

RBM Sør has a low proportion of loans with high risk

CM Sør has a moderate to high proportion of loans with low risk

CM Sør has a moderate to low proportion of loans with high risk

70,0% of portfolio

30,0% of portfolio

81,5 %

15,9%

2,7%

82,6 %

14,3 % 3,1 %

< 10 MNOK 10 - 100 MNOK > 100 MNOK

2012 2013

59,5%

16,8% 23,8%

61,5%

18,6% 20,0%

< 2 MNOK 2 - 8 MNOK > 8 MNOK

2012 2013

Risk profile


Deposits by the amount

Lending by exposure size

Proportion of deposits below 2 MNOK constitutes 61,5%

Proportion of deposits between 2 and 8 MNOK constitutes 18,6 %

Proportion of deposits over 8 MNOK constitutes 20,0 %

Proportion of commitments under 10 MNOK constitutes 82,6 %

Proportion of commitments below 10 og 100 MNOK constitutes 14,3 %

Proportion of commitments over 100 MNOK constitutes 3,1 %


Net non-performing and doubtful commitments

One commitment (old) contribute negatively, stable underlying development

19

165 193 247 159 245 238 201 232 242

245 222

190

235

183 190 207

206 400

1,28 % 1,26 % 1,30 %

1,15 % 1,21 % 1,18 %

1,12 % 1,16 %

1,68 %

1,15 %

Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013

Non-performing Doubtful Non-performing and doubtful as % Underlying development


Deposit coverage

Group Group ex Sør Boligkreditt

57,3 57,4

Q2 2012 Q2 2013

78,5 77,8

Q2 2012 Q2 2013

Deposit coverage over target level at > 56 %

High deposit coverage in Group ex Sør Boligkreditt at 77,8 %

* Deposit coverage as % of net loans

20


Equity

CT 1/Core capital adequacy ratio Return on equity

12,3 12,1

13,3 12,9

1H 2012 1H 2013

6,9 6,8

8,1 8,2

1H 2012 1H 2013

Core Tier 1 12,1 % – required > 9 %

Return on equity 8,2 % in 1H 2013 adjusted for valuation of debt

* Return on Equity annualized

21

* This years result not included


Certificates and bonds

Assets Rating

Total portfolio 6,9 BNOK – Liquidity buffers 3,9 BNOK

~ 94 % investment grade – Liquidity buffers 100 % AAA/AA

Gov. 19 %

Local gov. 15 %

CB 43 %

Energy 4 %

Finance 3 %

Ind IG 8 %

Ind HY 6 %

Sub.loans 2 %

AAA/AA 78,3 %

A 7,2 %

BBB 8,4 %

BB 4,2 %

B 1,9 %

22


Maturity structure - debt

0

1 000

2 000

3 000

4 000

5 000

2014 2015 2016 2017 2018 2019 2020 > 2020

Sparebanken Sør Sør Boligkreditt Gov.repo

Good access to new funding at reasonable market prices. Good maturity structure, provides greater security under volatile conditions. Funding > 12 months constitute 78,5 %. Increasing maturities on average funding.

0

200

400

600

800

1 000

July Aug Sept Dec

2013

Sparebanken Sør Sør Boligkreditt Gov.repo

23


Stable access to long-term funding

1H

2013

2012

BNOK Maturity Margin (bp)

3 months NIBOR

Covered bonds 2,1 7,8 51

Senior bonds 1,0 5,2 91

Total 3,1 6,9 64

BNOK Maturity Margin (bp)

3 months NIBOR

Covered bonds 3,4 4,4 49

Senior bonds 2,5 5,4 168

Total 5,9 4,8 100

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Summary Q2 2013

Total

Income

Costs

Growth

Funding

Net interest income improved 17% compared to same period last year, and good underlying growth in commission income.

Costs under control and essentially flat nominal development.

Continued strong growth in lending and deposits.

Group funding are made at long maturities.

Stable underlying operations.

25


Future prospects

Macro

Income

Growth

Costs

Funding

Interest rate adjustments will continue to contribute positively.

Expectations of continued strong lending growth, but slightly reduced development in deposits.

Effects of cost reductions are balanced against necessary investments.

Good access to new funding.

Growth in the Norwegian economy is still good, but signs of somewhat more challenging macro conditions.

26

sparebanken

SØR

LOANS

ABCenter

€ SØR MARKETS

We contribute to a better life in the region

INSURANCE

SAVINGS

Norne

Frende Brage

sparebanken SØR · 2013. 12. 16. · Sparebanken SØR Q2 2013 Key figures - Group Profit and loss...

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