AVIDA HOLDING AB (publ) COMPANY PRESENTATION OCTOBER 2017

Transcription

1 AVIDA HOLDING AB (publ) COMPANY PRESENTATION OCTOBER 2017

2 DISCLAIMER Overview This presentation (the Presentation ) has been produced by Avida Holding AB (publ) (the Company, Bank Avida or Avida Holding ), solely for use at presentations to potential investors and is strictly confidential and may not be reproduced or redistributed, in whole or in part, to any other person. To the best of the knowledge of the Company and its board of directors, the information contained in this Presentation is in all material respect in accordance with the facts as of the date hereof, and contains no material omissions likely to affect its import. This Presentation contains information obtained from third parties. Such information has been accurately reproduced and, as far as the Company is aware and able to ascertain from the information published by that third party, no facts have been omitted that would render the reproduced information to be inaccurate or misleading. This Presentation contains certain forward-looking statements relating to the business, financial performance and results of the Company and/or the industry in which it operates. Forward-looking statements concern future circumstances and results and other statements that are not historical facts, sometimes identified by the words believes, expects, predicts, intends, projects, plans, estimates, aims, foresees, anticipates, targets, and similar expressions. The forward-looking statements contained in this Presentation, including assumptions, opinions and views of the Company or cited from third party sources are solely opinions and forecasts which are subject to risks, uncertainties and other factors that may cause actual events to differ materially from any anticipated development. None of the Company or any of their parent or subsidiary undertakings or any such person s officers or employees provides any assurance that the assumptions underlying such forward-looking statements are free from errors nor does any of them accept any responsibility for the future accuracy of the opinions expressed in this Presentation or the actual occurrence of the forecasted developments. The Company assumes no obligation, except as required by law, to update any forward-looking statements or to conform these forward-looking statements to our actual results. An investment in the company involves risk, and several factors could cause the actual results, performance or achievements of the company to be materially different from any future results, performance or achievements that may be expressed or implied by statements and information in this presentation, including, among others, risks or uncertainties associated with the company s business, segments, development, growth management, financing, market acceptance and relations with customers, and, more generally, general economic and business conditions, changes in domestic and foreign laws and regulations, taxes, changes in competition and pricing environments, fluctuations in currency exchange rates and interest rates and other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described in this presentation. The company does not intend, and does not assume any obligation, to update or correct the information included in this presentation. No representation or warranty (express or implied) is made as to, and no reliance should be placed on, any information, including projections, estimates, targets and opinions, contained herein, and no liability whatsoever is accepted as to any errors, omissions or misstatements contained herein, and, accordingly, none of the Company or any of their parent or subsidiary undertakings or any such person s officers or employees accepts any liability whatsoever arising directly or indirectly from the use of this document. By attending or receiving this Presentation you acknowledge that you will be solely responsible for your own assessment of the market and the market position of the Company and that you will conduct your own analysis and be solely responsible for forming your own view of the potential future performance of the Company s business. This Presentation speaks as of October Neither the delivery of this Presentation nor any further discussions of the Company with any of the recipients shall, under any circumstances, create any implication that there has been no change in the affairs of the Company since such time. 2

3 TABLE OF CONTENTS Overview I About Avida Holding AB (publ) II Q Financial Highlights III Appendix 3

4 AVIDA AT A GLANCE Key highlights Key comments Net loans to customers Products and geographic exposure * Originally established in 1983 however Avida has undergone a substantial revitalization after it was acquired by its new owners in October 2015 and a new experienced management & board was put in place. > SEK 265m in new equity has been raised since Oct the majority directly from the new owners. Avida s shares are trading on the Norwegian OTC list with a market capitalization of approx. NOK 1.95bn. Diversified niche bank focusing both on consumer finance and SME lending in Norway, Sweden and Finland. Highly diversified across geographies, segments and products - allows for dynamic capital allocation to the areas with the best risk / return characteristics. Products are distributed through brokers, affiliates and direct channels within consumer finance and through direct sales within SME lending. Significant investments has been made to streamline processes, improve analytical capabilities and increase the capital base to allow for the strong growth seen in Looking to build a lasting competitive advantage in distribution and credit scoring by combining technology and automation with superior analytics, both for the consumer and SME market. Fully automated, flexible and scalable solutions in Sweden, Norway and Finland economies of scale. Main focus on analytical prowess to ensure strong credit quality and in depth knowledge of each client. Looking to expand product offering in the SME segment, a segment that today is underserved by the banks. SEKm 2,052 1,833 1,601 1, Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q Net interest income SEKm H % 85% Net loans PRODUCTS Consumer 37% 63% Net interest income Business GEOGRAPHY Operating profit / Earnings before tax SEKm 100 % 100 % % 100 % 21% 36% 14% 38% 43% 48% Net loans Net interest income SWE NOR FIN H Note(*): as of 31 March 2017

5 MAIN MILESTONES SINCE CHANGE IN OWNERSHIP Overview Trøim, Midelfart, Ubon Partners and Icon Capital + former Gothia / Aktiv Kapital management team acquired 100 % of the shares in Avida. SUCCESSFUL PLACEMENT OF NEW SHARES - SEK Launch of consumer finance in Norway. Positive effects materializing across the Avida platform due to investments in Q4-15 and Q1-16. SUCCESSFUL PLACEMENT OF NEW SHARES - SEK Continued high loan growth in the consumer finance segment while developing broader product portfolio within SME lending OCTOBER 2015 Q Q Q Q Q Q SPRING 2017 Significant investments in personnel to improve credit risk management as well as distribution capabilities. Significant investments in infrastructure, and focus on process improvements, in order to increase competitiveness. Accelerating growth in all markets and business segments. Return to profit due to strict cost & loss control and steadily improving topline. SUCCESSFUL PLACEMENT OF NEW SHARES - SEK First day of trading on the Norwegian OTC market on 10 April 2017 (ticker: AVIDA ). 5

6 GEOGRAPHICAL PRESENCE Nordic footprint Strong platform for further growth Geographical overview Geographical distribution * NET LOANS OUTSTANDING NET INTEREST INCOME Avida Footprint = Current Office 21% 14% 43% 48% 36% 38% Sweden Norway Finland Sweden Norway Finland Key comments OSLO HELSINKI I Avida is headquartered in Stockholm and has centralised key functions such as IT, credit risk management and accounting STOCKHOLM II Healthy distribution of business between three geographic markets provides diversification and expansion opportunities III Proven key infrastructure / systems, with support for simultaneous multi country operations, already in place 6 Note(*): as of 31 March 2017

7 PRODUCT PORTFOLIO Diversified across sectors I CONSUMER FINANCE II BUSINESS III DEPOSIT ACCOUNTS Provides consumer finance products in Sweden, Norway and Finland: 1. Revolving credit facilities. 2. Amortizing loans with maturities of up to 15 years. Maximum principal of SEK / NOK 500,000 and EUR 30,000. Interest rates from ~5.9% to ~21.0% ** p.a. based on individual risk assessments. No collateral obligations or restrictions regarding use of proceeds. Provides credit services to SMEs in Sweden, Norway and Finland: 1. Invoice financing. 2. Factoring of both consumer invoices and business invoices. 3. Invoice administration services. 4. Business loans and credit lines *** (complete working capital solutions). 5. Specialized sales financing ***. Provides debt collection services in Sweden and Norway. Provides floating rate deposit product in: 1. Sweden. 2. Norway (launch August 2017). Diversified funding facilities matching operational footprint provide a natural currency hedge. State deposit guarantee in Sweden (SEK 950,000) and Norway (EUR 100,000). Will consider to offer fixed term deposits. GEOGRAPHICAL DISTRIBUTION * GEOGRAPHICAL DISTRIBUTION * GEO. DISTRIBUTION * HISTORICAL DEV. NET LOANS NET INTEREST INCOME NET LOANS NET INTEREST INCOME DEPOSITS (%) DEPOSITS (SEKm) 24% 17% 59% 17% 44% 39% 22% 38% 40% 29% 9% 62% 100% SEKm ,663 2,135 Sweden Norway Finland Sweden Norway Finland Sweden Norway Finland Sweden Norway Finland Sweden Norway Finland Q1 17 SHARE: ~ 85% SHARE: ~ 63% SHARE: ~ 15% SHARE: ~ 37% NET LOANS FUNDED BY DEPOSITS: ~ 116% 7 Note(*): as of 31 March 2017 Note(**): 39.0% for certain niche products Note(***): under implementation from Q2 2017

8 DISTRIBUTION PLATFORM Multichannel approach CONSUMER FINANCE BUSINESS AVIDA BRAND THIRD-PARTY LENDING AGENTS ** DIRECT DISTRIBUTION WEB WEB SENIOR SELLERS CALL CENTER INEGRATION IN ERP-SYSTEMS EXCLUSIVE AFFILIATES CUSTOMIZED BUSINESS SOLUTIONS Share of CF distribution volume Q1 * % GOAL 70 % Share of CF distribution volume Q1 * % GOAL 30 % 8 Note(*): as of 31 March 2017 Note(**): selection not exhaustive

9 GROSS INCOME AGE GENDER CUSTOMER PROFILE Solid counterparties generating modest risk CONSUMER FINANCE * BUSINESS * SWEDEN NORWAY FINLAND NORDICS VOLUME PER CUSTOMER TYPE 68% 32% Female Male 58% 42% Female Male 52% 48% Female Male 32% 12% B2B finance w/o risk 56% B2C finance with risk Service 28% 28% 23% 17% 4% 0% % 24% 27% 11% 2% 3% % 28% 21% 15% 7% 2% NUMBER OF INVOICES PER CUSTOMER TYPE 8% 76% 15% B2B finance w/o risk B2C finance with risk Service 1% 22% 48% 19% 10% 10% 10% 21% 22% 37% 11% 28% 33% 15% 13% TYPICAL CUSTOMERS < 200k 2-300k 3-400k 4-500k > 500k < 200k 2-300k 3-400k 4-500k > 500k < 200k 2-300k 3-400k 4-500k > 500k 9 Note(**): as of 31 March 2017

10 CREDIT RISK MANAGEMENT Proven operational strategy and procedure CONSUMER FINANCE SWEDEN AND FINLAND BUSINESS NORDICS CREDIT APPLICATION CREDIT APPLICATION D1 INTERNAL SCORING D2 EXTERNAL SCORING D3 LOAN LIMIT MATRIX RISK BASED PRICING MATRIX OFFER + E-SIGN YES NO Client evaluation Financial statements Collateral Incl. / Excl. credit risk CREDIT POLICY Limits per client / invoice Delivery approval Credit rating / information Money laundering reg. NORWAY CREDIT LIMIT EUR 0 EUR 400k CREDIT LIMIT EUR 400k EUR 1,500k CREDIT LIMIT EUR > 1,500k CREDIT APPLICATION POLICY INTERNAL SCORING EXTERNAL SCORING DECISION LOAN LIMIT MATRIX OFFER + E-SIGN YES LOCAL CREDIT COMMITTEE CENTRAL CREDIT COMMITTEE BOARD COMMITTEE RISK BASED PRICING MATRIX NO YES NO KEY COMMENTS Newly revised framework - high availability of good quality credit information Targeting predictable conversion rates at acceptable credit risk levels Automated credit process based on external and internal scoring procedures Methodology focused around high level of analysis and monitoring KEY COMMENTS Senior executives with excellent credit expertise in all committees Mix of different collateral / setups provides high level of risk control Low losses after implementation of new framework as of November 2015 Easy access to good quality credit information 10

11 MANAGEMENT Experienced and hands-on Johan Anstensrud Chief Executive Officer Martin Ahlberg Head of Consumer 560,000 shares Started in Avida November 2016 Selected experience: CEO in Infocare, Managing Director in Bisnode, Enterprise Director in Microsoft and Engagement Manager in McKinsey M. Sc. in Industrial Engineering from the Norwegian Institute of Technology and MBA from Harvard University 100,000 shares Started in Avida May 2016 Selected experience: Risk Director in Santander Consumer Bank (Sweden), Head of Credit & Risk in Marginalen Bank, Head of Credit & Risk in Citibank Consumer Bank and Manager in KPMG B. Sc. in Public Administration from the University of Stockholm Lars Dencker Nielsen * Chief Financial Officer Tore Krogstad Head of Business (NOR) 1,744,000 shares Started in Avida October 2015 Selected experience: Co-Founder in ITL Group, CFO in Arvato Nordics, CFO in Gothia Financial Group, Finance Director in G4S Norge and CFO in The East Asiatic Co / Heidelberg (Beijing, China) M. Sc. in Finance & Accounts (Auditing) from Århus Business School 308,000 shares Started in Avida November 2015 Selected experience: CEO in Arvato, Sales and Marketing Director in Gothia, Sales and Marketing Director in Aktiv Kapital, Head of Football at Football Association of Norway and Police Constable at Oslo Police District B. Sc. in Police Studies from the Norwegian Police University College Katrin Lindahl Wallin Chief Information Officer Jessica Sparrfeldt Head of Business (SWE&FIN) 68,000 shares Started in Avida May 2016 Selected experience: Senior Advisor in Centigo, Head of Management Control in Länsförsäkringar Bank, Head of IT in DnB NOR Bank (Sweden), Director Capital Markets as well as Director IT in Svenska Handelsbanken M. Sc. in Business and Economics and B.Sc. in IT from Halmstad University 41,000 shares Started in Avida March 2017 Selected experience: Head of Corporate in Collector Bank as well as Head of Products within Corporate Banking in Marginalen Bank Several courses within Business, Strategy, Management and Marketing from IHM Business School, UC Business School and ESI International Øystein Dannevig Chief Analyst 280,000 shares Started in Avida November 2016 Selected experience: Partner Bridgehead, Chief Analyst Aktiv Kapital, Chief Analyst PRA Group Europe M. Sc. in Business and Economics from the Norwegian Business School (BI) 11 Note(*): Avida Finans AB (publ) and Lars Dencker Nielsen have agreed to end the work relationship within year-end The process of finding a new CFO has commenced.

12 BOARD OF DIRECTORS Seasoned and diligent Stefan Alexandersson Chairman of the Board Christian Bjørnstad Board Member (Icon Capital) 36,000 shares Chairman in Avida since June 2017 Selected experience: CEO, Senior Executive Vice President, CFO and CIO in Collector Bank between 2005 and 2017 M. Sc. In Accounting, Finance and Marketing from Umeå University 11,143,470 shares *** Board Member in Avida since October 2015 Selected experience: Partner in Icon Capital, Partner in McKinsey, VP in Merrill Lynch International and Associate in Credit Suisse First Boston B. Sc. In Business Administration from University of Denver and MBA from Kellogg Graduate School of Management Geir Olsen Board Member (Ubon Partners) Celina Midelfart Board Member Board Member in Avida since August 2016 (prior Chairman) Board Member in Avida since October ,554,000 shares * Selected experience: Partner in Ubon Partners, Board Member in PRA Group, Board Member in Acano, CEO in Aktiv Kapital, VP of Telepresence Sales in Cisco, President of EMEA in Tandberg and Manager in McKinsey M. Sc. in Economics and Business from Norwegian School of Economics 4,464,530 shares Selected experience: Owner, CEO, Executive Chairman and Board Member of several companies within the Midelfart conglomerate B. Sc. in Finance from the London School of Economics as well as Stern School of Business at New York University Håkon Fure Board Member (Magni Partners) Board Member in Avida since August 2016 Selected experience: Board Member in Storebrand, Partner in Magni Partners and Head of Bank and Insurance Research in DNB Markets 10,206,000 shares ** M. Sc. in Finance from Norwegian School of Management (BI) and Università Commerciale 'Luigi Bocconi (Milan, Italy) 12 Note(*): indirectly through Ubon Partners / Whiteout Note(**): 9.85m shares indirectly through Magni Partners / Taran Holdings Note(***): indirectly through Icon Capital / IC Financials AS

13 10-Apr 17-Apr 24-Apr 1-May 8-May 15-May 22-May 29-May 5-Jun 12-Jun 19-Jun 26-Jun 3-Jul 10-Jul 17-Jul 24-Jul 31-Jul 7-Aug 14-Aug 21-Aug 28-Aug 4-Sep 11-Sep 18-Sep 25-Sep 2-Oct LEGAL AND SHAREHOLDER STRUCTURE Strong shareholder base Legal structure Shareholder structure as of Avida Finans AB (publ) SE Avida Finans AB NUF NO Avida Holding AB (publ) SE Avida Finans AB FIF FI Avida Inkasso AS NO Paraten AB SE Share price development since NOTC registration Price (NOK) % 100% VOLUME 100% 100% 100% AVIDA # of shares 180, , , , ,000 80,000 60,000 40,000 20,000 0 # Shareholders Type Country # % 1 WHITEOUT AS Company NOR 14,554, % 2 IC FINANCIAL AS Company NOR 11,143, % 3 TARAN HOLDINGS LTD Company BMU 9,851, % 4 MIDELFART CAPITAL AS Company NOR 4,464, % 5 DENCKER INVEST AS Company NOR 1,744, % 6 DNB NOR MARKETS Aksjehand/analyse NOR 1,500, % 7 VIMAR AS Company NOR 1,140, % 8 CUMULUS ASSOCIATES AS Company NOR 560, % 9 STRAWBERRY EQUITIES AS Company NOR 434, % 10 HÅKON REISTAD FURE Private investor GB 355, % 11 ENGELIA INVEST AS Company NOR 308, % 12 SUNDT AS Company NOR 305, % 13 CITIBANK Nominee USA 303, % 14 ØSD FINANS AS Company NOR 280, % 15 PARK LANE FAMILY OFFICE AS Company NOR 200, % 16 UTILIS INVEST AS Company NOR 183, % 17 DALLAS ASSET MANAGEMENT AS Company NOR 173, % 18 HERTZBERG INVEST AS Company NOR 130, % 19 T.D. VEEN A/S Company NOR 130, % 20 INVESTISOL AS Company NOR 98, % 21 MH CAPITAL AS Company NOR 86, % 22 ALDEN AS Company NOR 70, % 23 KATRIN LINDAHL WALLIN Private investor SWE 68, % 24 HEGE KRISTIN EVENSEN Private investor NOR 59, % 25 PIONEER CAPITAL PARTNERS AS Company NOR 43, % Sum TOP 25 48,182, % Other shareholders 620, % Total 48,803, % 13

14 TABLE OF CONTENTS Overview I About Avida Holding AB (publ) II Q Financial Highlights III Appendix 14

15 Q HIGHLIGHTS (I) Operational overview Group results Continued growth in loan book, up 197% YoY to SEK 2,052m. Revenues increased to SEK 74.4m in Q2 vs SEK 37.4m in Q Net profit of SEK 12.3m vs loss of SEK 3.4m last year. Equity funding increased by of SEK 30m. Consumer Finance Continued strong growth in consumer loans across all markets, with total net loans growing close to 200% since Q2 last year. The growth reflects a shift in strategy with growth primarily occurring in lower risk segments, reducing both the net interest margin from 18.2% to 13.2% and the loan loss provisions ratio from 3.5% to 1.0% (2.6% without gains from portfolio sales in Norway). In April a portfolio of NOK 35m of nonperforming consumer loans was sold in Norway with a positive effect of NOK 7m in Q A new product was launched in Finland towards the end of the period increasing growth in Finland going forward. Business Finance While Factoring volumes were relatively flat, an underlying business mix shift is occurring with new clients being larger and more profitable. Continued strengthening of the Business Finance team with a number of new key hires to drive the new growth strategy for the segment. In all markets a major part of our sales force will now be experienced sales executives from the finance sector, coming on board in Q3. New products are under development. Avida launched export factoring towards all major export markets in Q2 and will launch business loans towards companies using our factoring product. Uptick in sales at the end of the quarter is set to positively impact the P&L in the second half of Product finance for electronic retailers (credit purchase of mobile phones combined with guaranteed buy-back and insurance) has been developed and launched at the end of the period. This product has generated a lot of interest from retailers and we will aggressively scale this product over the next 12 months. 15

16 Q HIGHLIGHTS (II) Key financial ratios I Portfolio growth Y-on-y growth in net loans of 197% - Total outstanding loans of SEKm II Net interest margin Net interest margin of 17.3% III Cost / net interest income ratio Cost / Income ratio of 64.9% - Reflecting ongoing platform investments IV Loan losses Annualized loan losses of 2.0% - Losses on consumer loans at 1% and losses on SME factoring at 8%, mainly driven by legacy high margin and higher risk B2C factoring contracts V Return on equity ROE of 14.2% - Reflecting increased capitalization and material investments - current run-rate above 20% VI CET1 ratio CET1 ratio of 16.2% - Well above regulatory minimum requirements 16

17 LOAN PORTFOLIO Strong growth in customers and net loans Number of customers (#) Net loans to customers (SEKm) Continued strong growth in number of customers in Q Significant volume growth during Q

18 CONSUMER FINANCE SEGMENT Growth driven by lower risk customer segments Income (SEKm) Yield (%) and NIM (%) * Losses on loans (SEKm) & loss ratio (%) # of days past due on consumer loans (%) 18 Note(*): Yield and NIM is excluding netting of external commission

19 BUSINESS SEGMENT Stable with loss levels driven by high share of non-recourse factoring Income (SEKm) Yield (%) and NIM (%) * Losses on loans (SEKm) & loss ratio (%) Business mix (% base on Income) 19 Note(*): Yield and NIM is excluding netting of external commission

20 KEY BLANACE SHEET FIGURES Solid and highly transparent Key ratios Liquidity (SEKm) Average outstanding loan size ~SEK 36,280 LCR 115% Deposit ratio 104% Funding (SEKm) and deposit ratio (%) Total equity (SEKm) & CET1 ratio (%) 20

21 DETAILED FINANCIAL FIGURES (I) Profit & Loss P&L statement SEKm Q Q H H Interest income 79,7 42,5 151,5 79,0 204,4 145,3 Interest cost -4,3-1,4-8,6-2,6-8,4-5,8 Net interest income 75,4 41,1 143,0 76,4 196,0 139,5 Net result from financial transactions -2,5-4,7-6,0-7,0-6,6-2,1 Other income 1,5 1,0 2,7 2,9 6,0 3,1 Total income 74,4 37,4 139,7 72,4 195,4 140,6 Administrative cost -46,5-32,0-84,4-61,3-133,5-91,3 Depreciation and amortization -1,8-1,3-3,5-2,5-5,6-3,9 Sum operational cost -48,3-33,3-87,9-63,8-139,1-95,2 Result before credit loss 26,1 4,1 51,8 8,6 56,3 45,4 Net credit loss -10,3-8,4-29,7-17,4-45,0-32,3 Operating profit / EBT 15,8-4,4 22,1-8,8 11,3 13,1 Tax -3,5 1,0-4,9 1,9 1,6-4,3 Profit after tax 12,3-3,4 17,2-6,9 12,8 8,8 Key comments Avida has over the last year seen a material growth in its balance sheet, primarily in the consumer finance segment. This, combined with a shift in strategy towards larger and lower risk clients has led to a close to 100% increase in revenues while costs only increased by approximately 45%, highlighting the economies of scale in the business. Loan loss provisions increased by less than the growth in loans YoY as the new clients continuously show a better credit risk - this is further reflected in the Non Performing Loan sale conducted in April and the subsequent positive results effect. In Q2 the result was 1.5 times higher than Q1 results as the investments made over the last years are starting to be reflected in the results. 21

22 DETAILED FINANCIAL FIGURES (II) Balance Sheet BS statement SEKm Cash and balance to central bank 3,2 1,8 0,7 Certificates and bonds 67,4 54,5 18,3 Loans to credit institutions 299,5 198,7 111,4 Net loans to customers 2 052, ,4 690,9 Shares and shares in ass. Companies 4,2 4,2 4,0 Intangible assets 21,2 15,3 13,0 Machines and inventories 5,4 5,4 5,2 Other assets 28,8 38,8 6,9 Prepaid expenses and accrued income 70,6 56,7 19,4 Total assets 2 552, ,8 869,8 Deposits from customers 2 138, ,3 704,1 Other liabilities 26,9 27,8 22,4 Accrued expenses and prepaid income 13,6 12,8 13,2 Deferred tax liabilities 4,7 4,7 0,2 Total liabilities 2 183, ,6 739,8 Share capital 4,8 4,4 3,5 Retained earnings 346,8 270,6 113,6 Earnings in year 17,2-6,9 12,8 Total equity 368,9 268,2 130,0 Key comments The net loans increased by SEK 1,361m YoY and SEK 451m 1H 2017 leading to a total net loans of SEK 2,052m. The funding is mainly comprised of deposits and equity with deposits increasing by SEK 1,434m YoY and SEK 475m 1H 2017 leading to a liquidity portfolio of close to SEK 300m. Avida has now launched FlexiSpar in Norway to diversify its funding sources further by introducing NOK deposits and will going forward continue to develop and offer new deposit products. The equity base increased by SEK 239m YoY and SEK 101m 1H 2017 leading to an equity base of SEK 369m, implying a capital ratio of 16.2% - well above the capital targets and requirements. Total equity and liabilities 2 552, ,8 869,8 22

23 STRATEGY GOING FORWARD Profitable growth across the Nordic region through insight and new products I Continued strong growth within consumer finance and business SME markets across the Nordic region Targeting SEK5bn in 2018 and SEK 10bn by 2020 through growth in consumer and business segments Broaden business / SME product offering around existing factoring and receivables, offering more comprehensive loans and cross border products II Big data / analytic driven sales, scoring and follow up Aim for building best in class big data analysis and analytics department Focus on gaining access to more data on both customers and potential customers to drive better risk and distribution analysis All customer decisions are planned and expected to be data driven III Digitalized processes and products Fully automated systems in consumer finance pioneering similar offering in the much larger Nordic Business / SME market All analytics to be supported by digital data collection and automated decision systems IV Actively leverage capital markets in order to adjust capital position according to growth ambitions Growth will be adjusted to the Bank s ability to find and develop profitable niches with attractive return on equity Avida is looking to build a lasting competitive advantage in distribution and credit scoring by combining technology and automation with superior analytics 23

24 IMPORTANT FUTURE FINANCIAL TARGETS Overview I Loan growth Significant growth opportunity; realistic target of SEK 10bn loan book by 2020 by pursuing opportunities in both consumer and business Dynamic allocation of capital to products/segments with best risk/reward Key BS and P&L figures Net loans to consumers SEKm 10,000 7,500 II Return on equity Target return on equity of more than 25% in line with industry average Lower ROE in the short term due to investment in organization and infrastructure 1,601 2,800 5, e 2018e 2019e 2020e Current CET1 ratio target of ~13% III Capital ratios Current total capital ratio target of % SEK 265 million raised from Oct 2015 Will leverage capital markets for both debt and additional equity to grow intelligently Operating profit / Earnings before tax SEKm IV Dividend policy Target dividend payout ratio of 35% No dividend payments in short / medium term due to growth focus e 2018e 2019e 2020e 24

25 VALUE PROPOSITIONS Diversified, scalable and set for high growth 1 Diversified business - well positioned to capture large opportunity in the SME market in the Nordics 2 Reshaped, automated platform - well set up for growth across the Nordics 3 Scalable model targeting SEK 10bn loan book by Renewed, strong management team that has done this before set to do it even better this time 5 Shareholder friendly set up with long-term and active key shareholders 25

26 TABLE OF CONTENTS Overview I About Avida Holding AB (publ) II Q Financial Highlights III Appendix 26

27 MACROECONOMIC ENVIRONMENT Solid fundamentals Sweden Norway Finland GDP growth (% YoY) GDP growth (% YoY) * GDP growth (% YoY) 10% 5% 0% -5% 4.7% 3.4% -0.6% -5.2% 6.0% 2.7% 4.1% 2.6% 3.2% 1.2% -0.3% % 5% 0% -5% 5.0% 5.7% 1.7% 3.8% 1.8% 1.9% 2.3% 2.2% 1.1%0.9% % 10% 5% 0% -5% 4.1% 5.2% 0.7% 3.0% 2.6% 0.2%1.4% -1.4%-0.8%-0.7% % -10% -10% -8.3% Consumer spending growth (% YoY) Consumer spending growth (% YoY) Consumer spending growth (% YoY) 8% 6% 4% 2% 4.0% 2.8% 0.2% 4.0% 2.8% 3.1% 1.9% 1.9% 2.1% 0.8% 8% 6% 4% 2% 5.0% 5.3% 1.7% 3.8% 3.5% 2.3% 2.7% 1.9% 2.1% 1.7% 8% 6% 4% 2% 4.1% 3.5% 2.1% 3.1% 2.9% 2.2% 1.5% 0.3% 0.6% -0.5% 0% -2% -4% % Unemployment rate (%) 0% -2% -4% 0% % 0.0% -4% -2.7% Unemployment rate (%) Unemployment rate (%) 10% 8% 6% 4% 7.1% 6.1% 6.2% 8.3% 8.6% 7.8% 8.0% 8.0% 7.9% 7.4% 6.9% 10% 8% 6% 4% 3.4% 2.5% 2.6% 4.4% 4.7% 3.6% 3.3% 3.2% 3.5% 3.5% 10% 8% 6% 4% 7.7% 6.9% 6.4% 8.2% 8.4% 7.8% 7.7% 8.2% 8.7% 9.4%8.8% 2% % % % Solid underlying market fundamentals in all relevant geographies 27 Source: Statistics Sweden, Statistics Norway, Statistics Finland Note(*): Mainland Norway

28 Norway Sweden MARKET OVERVIEW Underlying potential for continued volume growth and attractive margins CONSUMER FINANCE BUSINESS Outstanding loans (excl. cards) Outstanding loans (SMEs) Factoring SEKbn % % 16% 18% 12% % % SEKbn 1,676 1,706 1,825 1,856 1,874 1,941 1,994 2,072 SEKbn Loan volume Niche players share of total market NOKbn % 7% 9% % 20% 16% % NOKbn 1,034 1,087 1,158 1,213 1,234 1,288 1,355 1,367 NOKbn Loan volume Niche players share of total market Finland * EURbn % 3% 3% 2% 1% 1% 1% EURbn Finnish factoring volume is growing faster than the European average Overall market growth in Finland of ~12% in 2015 ** Loan volume Niche players share of total market Note(*): Historical data for factoring not available for Finland Note(**): OP Financial Group Source: OECD, Statistics Sweden, Statistics Norway, Bank of England, Bank of Finland, Deutsche Bundes Bank, Bank of Italy; FCI, Svensk Factoring, Finansieringsselskapenes Forening Norge

29 COMPETITIVE LANDSCAPE Increasing competition across products and geographical markets CONSUMER FINANCE Outstanding loans (SMEs) BUSINESS Factoring Main * competitors Competitive situation Increasing number of niche players entering the market Consumer finance specialists expected to be the best performing business model Strong competition in large corporate segment, challenging to compete with general banks Moderate to low competition in SME segment, major banks staying away from smaller and riskier customers Tough price competition from banks and financing companies quality of offer important Major banks becoming more aggressive in SME segment in Sweden Profitability Margins overall expected to decrease somewhat, from elevated levels High willingness to pay and healthy margins within SME segment Low profitability in segments with high competition, moderate in SME segment Better margins available for total service suppliers and for higher leverage offering Attractive if capital requirement is an issue Trends Tighter regulatory environment with new regulations to slow down the market growth Need for tailored solutions are increasing with customers Niche players recently launched SME offer more players expected to follow Strong demand will likely increase with availability, profitability expected to remain attractive Tough competition expected to continue Players will need to differentiate and have efficient and automated processes to create good returns 29 Note(*): not exhaustive

30 STOCKHOLM Visiting address: Södermalmsallén 36 Postal address: Postbox Stockholm Contact information: Phone: HELSINKI Visiting address: Itsehallintokuja 6 Postal address: Vänrikinkuja Espoo Contact information: Phone: luotto@avidadinans.fi OSLO Visiting address: Grenseveien 92 Postal address: Postbox 6134 Etterstad 0602 Oslo Contact information: Phone: info@avida.no