Swedbank Year-end report 214 Michael Wolf, CEO Göran Bronner, CFO Anders Karlsson, CRO Swedbank
Swedish Banking Strong customer activity SEKm Q4 14 Q3 14 QoQ YoY Net interest income 3 31 3 372-71 -271 Net commission income 1 821 1 746 75 642 Other income 433 449-16 681 Total income 5 555 5 567-12 1 52 Total expenses 2 631 2 581 5 1 153 Profit before impairments 2 924 2 986-62 -11 Improved market position Lower deposit margins Flat mortgage margins Good commission income Credit impairments 147 43 14-92 Ratios Q4 14 Q3 14 FY 214 ROE, % 2.3 25.9 25.4 C/I ratio.47.46.48 Volumes, SEKbn Q4 14 Q3 14 QoQ FY 214 Loans 1 24 1 5 19 87 Deposits 411 42 9 26 2
Baltic Banking Stable result SEKm Q4 14 Q3 14 QoQ YoY Net interest income 863 865-2 34 Net commission income 55 5 5 223 Other income 165 148 17-81 Total income 1 533 1 513 2 482 Total expenses 674 615 59 61 Profit before impairments 859 898-39 421 Credit impairments -1-59 49 251 Stable income despite low interest rate environment Solid asset quality No impact from the situation in Russia All countries part of EMU Lithuania joined 1 Jan 215 Ratios Q4 14 Q3 14 FY 214 ROE, % 13.9 15.7 14.6 C/I ratio.44.41.41 Volumes, SEKbn Q4 14 Q3 14 QoQ YoY Loans 126 121 5 7 Deposits 138 125 13 18 3
Large Corporates & Institutions Solid result in volatile market SEKm Q4 14 Q3 14 QoQ YoY Net interest income 888 876 12 9 Net commission income 529 561-32 248 Net gains and losses 433 354 79-33 Other income 2 36-16 -46 Total income 1 87 1 827 43 259 Total expenses 845 835 1 15 Profit before impairments 1 25 992 33 154 Credit impairments 12 27-15 21 Increased market volatility Good corporate activity Strong real estate market Falling oil prices Increased risk Changed client needs Ratios Q4 14 Q3 14 FY 214 ROE, % 15.1 13.8 19.4 C/I ratio.45.46.43 Volumes, SEKbn Q4 14 Q3 14 QoQ FY 214 Loans 175 161 14 21 Deposits 16 14 2 17 4
Group results Improved market position SEKm Q4 14 Q3 14 QoQ FY 14 YoY Net interest income 5 89 5 829-2 22 642 613 Net commission income 2 882 2 816 66 11 24 1 72 Net gains and losses 69 799-73 1 986 52 Other income 619 76-87 3 472 179 Total income 9 379 1 15-771 39 34 2 366 Total expenses 4 293 4 164 129 17 62 954 Profit before impairments 5 86 5 986-9 21 72 1 412 Credit impairments 254 235 19 419 359 Strong customer activity Mixed margins Treasury result effects Good cost efficiency Solid asset quality Other impairments 33 19 14 257-618 Tax 1 1 164-164 4 31 22 Profit from continuing operations 3 798 4 562-764 16 79 1 468 Ratios Q4 14 Q3 14 FY 14 ROE continuing operations, % 13.3 16.6 15.2 Cost/income ratio.46.41.45 CET1 capital ratio, % 21.2 2.7 21.2 5
Capital Strong capitalisation regulatory uncertainty remains 2.7% CET1 capital ratio, % 21.2% 19.3% CET1 capital positively impacted IAS 19 (SEK 1.1bn) Dividend from insurance company (SEK 1.3bn) REA net increase of SEK 4.6bn Loan volume growth Q3 214 Q4 214 CET1 Capital ratio requirement LGD and PD effects Capital regulatory uncertainty No regulatory excess capital 6
Asset quality Strong asset quality in challenging environment Credit impairments, SEKm Q4 14 Q3 14 FY 14 Swedish Banking 147 43 246 Baltic Banking -1-59 -186 Continued low loan losses Limited impact from Russia Large Corporates & Institutions 12 27 381 Group Functions & Other -3-19 -22 Swedbank Group 254 235 419 Ratios Q4 14 Q3 14 FY 14 Credit impairments, ratio %.7.7.3 Share of impaired loans, gross % Total provision ratio for impaired loans, %.41.47.41 53 55 53 7
Asset quality Shipping and Offshore Total portfolio of SEK 3bn Moderate volume increase over time USD based SEK 19bn negatively impacted by lower oil prices Stress tests performed Listed, well-capitalised companies Long-dated contracts Collateralised lending 1 9 8 7 6 5 4 3 2 1 Shipping and Offshore Loans net, SEKm Negatively impacted by lower oil prices 8
Swedbank Year-end report 214 Q&A
Appendix 1
Asset quality Conservative provision ratio SEKm 2 15 64% 65% 62% 57% 54% 53% 54% 6% 56% 55% 53% Provision ratio, % Q4 14 Swedish Banking 61 LC&I 62 Baltic Banking 48 Group 53 1 2 4 1 774 1 545 5 1 951 9 934 1 42 1 398 1 325 7 77 1 256 1 238 1 211 1145 1 133 4 429 4 47 3 57 2 818 2 514 2 343 2549 2 197 Q212 Q312 Q412 Q113 Q213 Q313 Q413 Q114 Q214 Q314 Q414 Individual provisions Portfolio provisions Provision ratio Since Q1 213 Russia and Ukraine are reported as discontinued operations Source: Swedbank, Dec 31, 214 11
Liquidity and funding Lower funding needs LCR 12% (Swedish FSA definition FFFS 212:6) NSFR 98% (Basel committee) Issued SEK 115bn of term funding in 214 FY 215 funding plan of around SEK 16bn Term funding issuance completed and planned Prefunded in excess of 12 months SEKbn Covered bonds Senior unsecured debt SEKbn 1 3 9 8 25 7 2 6 5 15 4 3 1 2 5 1 Q112 Q212 Q312 Q412 Q113 Q213 Q313 Q413 Q114 Q214 Q314 Q414 Q115 Q215 Q315 Q415 Source: Swedbank, Dec 31, 214, nominal amounts 2 4 6 8 1 12 14 16 18 2 22 24 26 28 3 32 34 365 Days forward 12
Liquidity and funding Long-term funding maturity profile Funding plan of around SEK 16bn to meet volume growth and next 12 months nominal SEK 11bn maturities Long-term funding maturity profile, by funding source Long-term funding maturity profile, by currency SEKbn SEKbn 2 Senior unsecured debt 2 15 Covered bonds 15 Other 1 1 CHF USD EUR 5 5 SEK 215 216 217 218 219 22-215 216 217 218 219 22- Source: Swedbank Dec 31, 214 13
Swedish housing and mortgage market Real estate prices Sweden 12 months performance Single-family homes 1 Tenant-owner rights 2 Combined 3 12M Δ 12M Δ 12M Δ Jan/14 7% 13% 9% Feb/14 7% 13% 9% Mar/14 7% 13% 9% Apr/14 8% 12% 9% May/14 8% 12% 9% Jun/14 8% 11% 9% Jul/14 9% 14% 11% Aug/14 9% 14% 11% Sep/14 9% 15% 11% Oct/14 8% 15% 11% Nov/14 13% 15% 14% Dec/14 15% 15% 15% Source: Valuegard www.valuegard.se (Based on data from Mäklarstatistik), 1 HOXHOUSESWE, 2 HOXFLATSWE, 3 HOXSWE 14
Real estate prices Baltic countries EUR/m 2 /No. of deals 1 8 Tallinn 1 6 1 4 1 2 1 8 6 4 2 Dec-5 Jun-6 Dec-6 Jun-7 Dec-7 Jun-8 Dec-8 Jun-9 Dec-9 Jun-1 Dec-1 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 EUR/m 2 /No. of deals 1 8 1 6 1 4 1 2 1 8 6 4 2 Riga Dec-5 Jun-6 Dec-6 Jun-7 Dec-7 Jun-8 Dec-8 Jun-9 Dec-9 Jun-1 Dec-1 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 No. of deals EUR/m2 No. of deals EUR/m2 EUR/m 2 /No. of deals 1 8 Vilnius 1 6 1 4 1 2 1 8 6 4 2 Dec-5 Jun-6 Dec-6 Jun-7 Dec-7 Jun-8 Dec-8 Jun-9 Dec-9 Jun-1 Dec-1 Jun-11 Dec-11 Jun-12 Dec-12 Jun-13 Dec-13 Jun-14 Dec-14 No. of deals EUR/m2 15