Debt Investor Presentation Q4/2015

Transcription

Sampo Group
Debt Investor Presentation
Prepared February 10, 2016
Figures December 31, 2015
DEBT INVESTOR CONTACTS
FINANCIAL CALENDAR 2016
Markku Pehkonen, CRO
tel. +358 10 516 0014
[email protected]
10/02/2016 Financial Statement Release for 2015
Silent period 13/01/2016-10/02/2016
Week 11
Annual Report 2015
21/04/2016 AGM
11/05/2016 Interim Statement Q1/2016
Silent period 13/04/2016-11/05/2016
10/08/2016 Half-yearly report 2016
Silent period 11/07/2016-10/08/2016
03/11/2016 Interim Statement Q3/2016
Silent period 04/10/2016-03/11/2016
Peter Johansson, CFO
tel. +358 10 516 0010
[email protected]
Jarmo Salonen, Head of IR Relations
and Group Communications
tel. +358 10 516 0030
[email protected]
Rated Company
Moody's
Standard and Poor's
Rating
Outlook
Rating
Outlook
Sampo plc
Baa2
Positive
Not rated
-
If P&C Insurance (Sweden)
A2
Positive
A
Stable
If P&C Insurance Co. (Finland)
A2
Positive
A
Stable
Disclaimer
This presentation may contain forward-looking statements that reflect management’s current views with respect to certain future events and
potential financial performance. Although Sampo 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 Sampo include, but are not limited to: (i) the macroeconomic development, (ii) change
in the competitive climate and (iii) developments in capital markets.
This presentation does not imply that Sampo 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
Sampo Group
If P&C
Mandatum Life
Sampo Group
Sampo plc
Appendix
Basic Facts
The Leading Nordic P&C Insurer
A Finish Financial Services Company
A Productive Value Creator
The Listed Parent Company – A Stable Dividend Payer
3-10
11-19
20-28
29-36
37-43
44-57
3
Sampo Group ― Basic Facts
Sampo ― The Leading Nordic Financial Institution
A Mixed Financial Conglomerate
Strong relative performance
Market cap January 29, 2016, EURbn
0
10
20
30
Nordea
37.5
Danske
25.0
Sampo
24.8
Swedbank
21.9
SHB
21.6
DnB
14.0
Gjensidige
Foreign and nominee registered
owners 60.96%
Solidium 11.90%*
5.1
Industrivärden
4.3
2.5
Varma Mutual Pension 6.35%
>30%
Björn Wahlroos 2.10%
1.7
Alm.Brand
1.1
Protector
0.7
Aktia
0.5
Source: Datastream
Sampo ownership structure
7.3
Tryg
Storebrand
>21%
18.0
Investor
Topdanmark
40
10Y Total Shareholder Return
Bank
Insurance
Inv.company
Ilmarinen Mutual Pension 0.86%
Kaleva Mutual Insurance 0.78%
Other domestic owners 17.05%
4
*100% owned by the Republic of Finland; 31.12.2015
Nordic Financial Group with Strong Brands
• Listed company Sampo plc
• Long-term investor
• Manager of capital structure and liquidity
• Pay-out ratio ≥ 50%
21.2%
100%
100%
> 30%
MARKET
POSITION
STRATEGY
• The leading P&C insurer
in the Nordic region
• The second largest
P&C insurer in Denmark
• Customer value
• Underwriting focus
• Focused insurance
• Cost efficiency
expertise
• Nordic business platform • Share buy-back
• Investment strategy
with balanced risk
• The largest financial
services group in
Northern Europe
•
•
•
•
Risk & Compliance setup
Simplification
Digital strategy
Cost & Capital efficiency
• Market leader in corporate
Life & Pension in Finland
• Danske bank distribution
•
•
•
•
Wealth management
Unit-linked products
Personal Risk insurance
Group pension &
Reward Services
INVESTMENT
~ EUR 11.4bn
ASSETS
~ EUR 2.4bn P&C
~ EUR 3.8bn Life
~ B/S EUR 647bn
~ AuM EUR 288bn
~ EUR 5.5bn+1.2bn*
~ EUR 5.9bn U-L AuM
RETURN /
PROFIT
TARGET
• Profit margin of 10%
• CR% 91%
• ROE above the Nordic
peer average
• RoE above 17.5%
• RoE above 17.5%
• CR% below 95%
* Segregated assets
5
Sampo Group Steering Model and Principles
• Non-complex structures and only minor contagion risks
– three separate and independent business areas
– straightforward and transparent legal structure combined with limited intragroup
exposures
• General Principles of Business activities
– clear responsibilities
– simple and flat operational structures
• Parent company gives guidance to the subsidiaries by setting
– targets for capitalization and ROE
– group principles for Risk Management, Remuneration, Compliance, Code of Conduct
• Subsidiaries organize underwriting activities independently taking into account
– the specific characteristics of their operations
– the above guidance from parent company
– the stakeholders’ expectations and external regulation
6
Well-established Insurance Subsidiaries
If P&C ― Well-diversified and
Profitable Pan-Nordic
Non-life Insurer
•
•
•
•
• If P&C provides insurance
solutions and services in the
Nordic and Baltic regions as
well as to Nordic customers
with international operations
• Business activities are
operated with a pan-Nordic
perspective
• The business is conducted by
client segments Private,
Commercial and Industrial,
the Baltic countries forming
a separate business area
If generated EUR 960m (931) in pre-tax profits
Excellent combined ratio of 85.4% (87.7)
– Risk ratio 66.6% (65.1)
– Cost ratio 18.8% (22.5)
– Expense ratio 13.0% (16.7)
Resilient business model over the cycle
Topdanmark – Danish non-life, life insurance and
pension funds – as an associate company
Mandatum Life ― Respected Finnish Expert
in Wealth Management, Rewards
and Risk Insurance
• Provides a comprehensive range
of services in Finland and Baltics
for corporate and private
customers
• Services provided
- tailored Unit-linked insurance
- wealth management
- personal risk insurance
- pension and reward services
• Mandatum Life is a leading life and pension insurer
in Finland
• Mandatum has a strong market position in Finland
with ca. 18% of the market
• Mandatum contributed with EUR 181m (163) in
pre-tax profit to the Group
7
Diversified and Most Stable Nordic Bank
• Pan-Nordic platform with scalability
• Simplification
• Digitalisation
• Superior Nordic distribution power
• Cost efficiency
• Capital efficiency
• Efficiency initiatives
Quarterly net profit
volatility
Nordea and peers 2006-Q3/2015,% 142
79
17
24
37
• Strong capital generation
• Stable returns
• Low risk profile
• Actively managed business
portfolios
• Lowest volatility of quarterly
net profits
47
8
Nordea
Peer 1
Peer 2
Peer 3
Peer 4
Peer 5
Danish Insurer with a Robust Business Model
9
Group Strategy ‒ Value Creation in Nordic Financials
LONG-TERM
VALUE CREATION
• Value creation through investments in Nordic financials based on knowledge of
Nordic markets, Nordic financial institutions & Nordic people.
• Commitment to the long-term development of affiliated companies.
CONSERVATIVE
PARENT WITH
PROFIT FOCUS
• Conservative capital structure, low leverage and strong liquidity.
• Parent company steers subsidiaries through Boards by approving (in Nordea and
Topdanmark by contributing to) strategies, guiding principles and ROE-targets.
OPERATIONAL
EXCELLENCE IN
SUBSIDIARIES
• Subsidiaries have focus on continuous development of services.
• Economies of scale.
• Pan-Nordic diversification & operational excellence facilitate low volatility.
CENTRALIZED
INVESTMENT
MANAGEMENT
• Company specific liabilities and solvency driving risk profiles, supported by
a Group-wide investment philosophy. Common investment infrastructure
facilitates effective monitoring and fast actions, also at the Group level.
GROUP LEVEL
PORTFOLIO
BENEFITS
• Profitable companies, mostly with the lowest volatility in the peer group.
• Profits of affiliated companies have low correlation creating diversification
benefits at the Group level.
LONG-TERM VALUE
FOR SHAREHOLDERS & BONDHOLDERS
10
Sampo Group
If P&C
Mandatum Life
Sampo Group
Sampo plc
Appendix
Basic Facts
A Finnish Financial Services Company
3-10
11-19
20-28
29-36
37-43
44-57
11
If P&C
Leading Nordic P&C Insurer with Synergies
Nordic Market shares Total GWP ~EUR 25bn
Market Shares by Country
Norway 2015
Gjensidige
If
Tryg
Sparebank 1
Other, 27
25%
22%
14%
10%
Sweden Q3/2015
LF
30%
If
18%
RSA (T-H)
15%
Folksam
17%
Denmark 2014
Tryg
Topdanmark
Codan (RSA)
Alm. Brand
If
18%
18%
12%
10%
6%
If, 18
Finland 2014
Pohjola
LähiTapiola
If
Fennia
32%
25%
25%
10%
LähiTapiola, 4
Topdanmark,
5
Tryg, 10
Pohjola, 4
Gjensidige, 9
Folksam, 5
LF, 9
RSA, 9
Expense Ratios 2014, %
Baltics 2014
RSA
If
BTA
Ergo
Gjensidige
22%
14%
13%
12%
7%
IF
16.7
Nordic peer group
16.5
Generali
27.1
Zürich
30.5
AXA
26
Allianz
RSA Scandinavia
Aviva
28.3
19.8
31.7
12
If P&C
Nordic P&C Insurance Market
CONSOLIDATED
MARKET
• The four largest companies account for 75-90% of the markets in Norway,
Finland and Sweden. In Denmark the market is less consolidated.
LOYAL CLIENTS
• Renewal rates are around 80-90%.
DISTRIBUTION
• In addition to traditional channels, the Internet continues to grow in
importance both as a distribution and as a service channel.
• Also, distribution via partnerships with banks and car-dealers etc. is
increasingly important.
LOW EXPENSE
RATIOS
• The market is characterized by low expense ratios in the rage of 15-20%.
European competitorsʼ expense ratios are usually considerably higher.
GOOD
PROFITABILITY
• The Nordic P&C market has generally experienced good profitability since
the beginning of 2000. The low interest rate environment and hence low
return on investments has made the industry focus on profitability in
the insurance operations.
13
If P&C
Diversification in Sales and Results
Gross Written Premiums, EUR 4,559m
By Business Area
Baltic, 133,
3%
Industrial,
572, 13%
By Country
Denmark,
395 , 9%
Private,
2644, 58%
Commercial,
1210, 26%
Baltic,
133, 3%
Norway,
1 432 ,
31%
Finland ,
1 038 ,
23%
Sweden,
1 560 ,
34%
Technical Results, EUR 657m
By Business Area
Other, 178,
27%
Industrial, 3,
0%
Baltic, 19,
3%
Commercial,
132, 20%
Private, 326,
50%
By Country
Other,
178 , 27%
Baltic, 19,
3%
Denmark,
35 , 5%
Finland ,
28 , 4%
Norway,
190 , 29%
Sweden,
208 , 32%
14
If P&C
Disciplined Underwriting and Diversification works
Geographical Diversification in CR
Combined Ratio Development
%
91.8 92.1 92.8 92.0 88.9 88.1 87.7
100 90.5
89.9 90.6
85.4
80 24.3 24.0 23.7 23.7 24.1 23.7 23.5 23.0 22.8 22.5 18.8
60
40
66.2 65.9 66.9 68.1 68.0 69.1 68.4 65.9 65.4 65.1 66.6
20
0
20052006200720082009201020112012201320142015
Risk ratio
Cost ratio
Target CR
If- Total
If Finland
If Sweden
If Denmark
If Norway
Combined Ratio ― If P&C and Nordic Peers
Standard deviation 2008-2014
%
100
95
92.1 93
96.1
92.8
90
95.2
92
2.1%
90.7
88.9
90.6
88.1
87.788.3
3.8%
4.7%
85
80
2009
2010
If P&C
2011
2012
2013
Nordic Market (incl. If)
2014
4.2%
4.6%
15
If P&C
Strong & Stable Annual Profit Development
EURm
1,200
Profit before tax
1,000
Comprehensive income
800
600
800
1,127
730
534
549
400
978
929
864
943
644
707
636
931
689
960
624
526
308
200
0
-200
-400
-267
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
16
If P&C
Seasonality in Quarterly Results and CR%
EURm
350
Technical result
Investment result
Operating result
300
250
200
150
100
50
0
Average Quarterly CR%, 2006-2015
Year 2014 CR%
Year 2015 CR%
Q4
89.9
87.1
87.7
Q3
88.6
86.9
83.8
Q2
88.2
86.5
80.9
Q1
93.1
90.3
89.2
17
If P&C
Conservative Investment Portfolio
Investment Allocation of Total EUR 11.4bn
Mark-to-Market Investment Return
14%
Equities
13%
Private Real Estate
0.2%
Equity
Money
0.2%
Market
12%
Public
sector
12%
12.4%
11%
7.4%
9%
5.8%
6% 4.3%
4.4%
2.6%
4%
6.1%
5.0%
4.1%
1.8%
1.5%
1%
-2%
-4%
-3.1%
Investment Return, EURm
Other fixed
income
62%
• Duration 1.2 years
• Average Maturity 2.6 years
• Fixed Income Running Yield 1.8%
1,000
800
821
689
600
558
459
400
190
113
200
0
2010
2011
2012
2013
2014
2015
18
If P&C
If P&C Solvency Capital Requirement Dec 31, 2015
Standard Formula (SF)
EURm
3,500
3,500
3,000
3,000
2,000
0
1,000
500
3,377
1,500
176 139 128
1,692
500
2,073
1,000
1,378
1,500
0
19
LAC = Loss Absorbing Capacity, DT = Deferred Taxes, SCR= Solvency Capital Requirement
3,058
211
176 246
128
828
473
1,388
992
2,000
2,500
3,058
118
3,202
2,500
Partial Internal Model (PIM)
757
EURm
Sampo Group
If P&C
Mandatum Life
Sampo Group
Sampo plc
Appendix
Basic Facts
3-10
11-19
20-28
29-36
37-43
44-57
20
Mandatum Life
Finnish Life Insurer with Wealth management Focus
Cross-sales
Client
Segment
Underlying
Market
Critical Success Factors
Sales & Client
Services
Corporates
Employee Benefit
• Expertise in Rewards and Incentives,
Pension & Risk Life Solutions and
Asset Management
Mandatum Life
HNWI
Wealth
Management
• Professional Wealth Management
• Management of Client Relationships
Mandatum Life
Retail Clients
Savings and
Insurance
Products
• Distribution Power
Danske Bank
21
Mandatum Life
Mandatum Life Business Volumes
Premiums Written*, total EUR 1,147m
Insurance Savings, total EUR 10,031m
2
With-Profit
EUR 177m
65
31
36
18
8030
2,101
406
U-L
EUR 970m
With-Profit
EUR 4,175
U-L
EUR 5,856m
3,926
1,821
385
196
147
Unit-linked life
Unit-linked Baltic
Other capital redemption
155
Unit-linked capital redemption
Other pension
Unit-linked pension
Other life
Other Baltic
*) Direct insurance
1,779
Technical Reserves, EUR 10,872m
EURm 12,000
10,000
8,000
6,000
4,000
2,000
0
607
884
4,616
1,262 1,752 2,071 1,637 2,359 3,124 3,054 3,833
Focus
area
5,312 5,858
1,228 1,196
4,652 4,626 4,738 4,695 4,621 4,487 4,431 4,410 4,249 4,071 3,927 3,837 3,818
2003
2004
2005
2006
2007
2008
Guaranteed interest rates
2009
2010
Segregated funds
2011
2012
2013
Unit-linked
2014
2015
22
Mandatum Life
Market Position by Premiums Written 12/2015, %
Market Shares in Finland
51.3
41.4
22.7
17.7
17
11.9
7.3
All Products Unit-Linked With-profit
Group
Pension
Private
Customers
Corporates
Baltics
23
Mandatum Life
Finnish With-Profit Life Insurance Market
PRINCIPLE
OF FAIRNESS
• There is no exact rule on profit sharing (e.g. 90%/10%).
• In the current markets, the principle is reflected in policyholdersʼ
reasonable expectations for total accrual, which is an average annual yield
of Finnish government bonds over time.
SMOOTHENED
BONUSES AND
DIVIDENDS
OVER TIME
• When company decides on bonuses and dividends, it takes into account (i)
policyholdersʼ reasonable expectations, (ii) realized investment returns and
current solvency and (iii) uncertainty about the future market environment
=> Bonuses and dividends can be smoothened over time.
BETTER POSITION
FOR RISK TAKING
BENEFITS
STAKEHOLDERS
• Finnish Profit sharing mechanism facilitates and incentives for active
investment strategies and risk taking.
• Profit sharing mechanism has benefited both policyholders and
shareholders over the years.
24
Mandatum Life
Profit Development
Profit before taxes
EURm
Comprehensive income
495
500
295 286
342
332
286
220
250
140
121
80
142
137
136
153
163 149
181 168
2014
2015
0
-115
-250
-378
-500
2006
2007
2008
2009
2010
2011
2012
2013
25
Mandatum Life
Mandatum Life Profit by Components
EURm
Net investment income
- Transferred to expense result
- Return on Unit-linked policies
- Return on With-profit policies*
INVESTMENT RESULT
EXPENSE RESULT**
RISK RESULT
OTHERS
PROFIT BEFORE TAXES
Change in the market value of investments
PROFIT AT MARKET VALUES
2015
632.0
-25.0
-238.8
-260.9
107.3
25.0
33.0
15.4
180.7
32.5
213.2
2014
539.8
-22.7
-267.3
-121.2
128.6
18.5
23.3
-7.7
162.8
20.2
183.0
98.4
80.3
103.0
84.2
Mandatum Life Group, expense ratio
Total expense ratio, %
Incl. kick backs, %
* Includes guaranteed interest, bonuses and change in the reserves of the above items
** Result of Unit-linked business EUR 22.8 million
26
Mandatum Life
Absolute Return Investment Portfolio
Mark-to-Market Investment Return
Investment Allocation of Total EUR 6.7bn
20%
Biometric
0.3 %
Unlisted
Equity
1%
Private
Equity
4%
Commodities Other
Alternative Trading
0%
6%
Derivatives Money
Market
0%
Securities
and Cash
8%
Real Estate
4%
Government
Bonds
1%
16.8%
15%
12.0%
9.7%
10% 8.3%
5.0%
5%
Policy Loans
0.1 %
Credit Bonds,
Funds and
Loans
50%
9.4%
7.1% 6.9%
4.6%
0%
-1.4%
-5%
-10%
Listed Equity
26%
11.1%
-7.8%
Investment Return, EURm
800
600
615
504
400
391
427
251
200
0
-200
2010
-59
2011
2012
2013
2014
2015 27
Mandatum Life
Mandatum Life Solvency II Capital Requirement
Dec 31, 2015
EURm
With transitional measures
2,500
2,000
1,500
37
351
252
*
39
91
303
1,000
1,913
1,431
500
1,212
0
* Own Funds without transitional measures EUR 1,307m
LAC = Loss Absorbing Capacity, TP = Technical Provision, DT = Deferred Taxes, SCR= Solvency Capital Requirement
28
Sampo Group
If P&C
Mandatum Life
Sampo Group
Sampo plc
Appendix
Basic Facts
The Listed Parent Company - A Stable Dividend Payer
3-10
11-19
20-28
29-36
37-43
44-57
29
Sampo Group ― Results, Capitalisation and Investments
Stable Development of Profit before Taxes
EURm
4,000
3,500
3,000
3,833
*
• If P&C
• Mandatum Life
• Sampo Bank
2,500
• If P&C
• Mandatum
Life
• Nordea /
Investment
• If P&C
• Topdanmark / Associated
• Mandatum Life
• Nordea / Associated
2,000
1,622 1,668
1,295 1,353
1,500
1,000
1,759 1,888
1,320 1,228
948
870
825
500
0
-500
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
P&C
* One-off item – sale of Sampo Bank
Life
Banking
Nordea dividends
Other
30
Stable Companies & Group Level Diversification*
1
P/L CONTRIBUTIONS
•
•
•
PBT 2010-15
IF
ML
Nordea
45%
10%
45%
•
0.27
1
0.13
0.85
LOW VOLATILITY EARNINGS
Geographical diversification
Strong Retail Banking Franchise
Diversified earnings base:
-Banking (Retail, Wholesale)
-Wealth Management (Asset
Management, Private Banking,
Life & Pensions)
Low earnings volatility & stable
ROE over the cycle
•
•
•
•
LOW VOLATILITY C/R
Geographical diversification
Strong Retail P&C Franchise
Several Lines of Businesses
-Motor, Cargo
-Workersʼ compensation
-Liability
-Accident
-Property
Low C/R volatility and
Conservative Investments
1
•
•
•
•
FOCUS IN U-L & WM
Finland & Baltics
Strong Finnish Position
Product areas
-Wealth Management
-Unit-linked Business
-With-profit Business
-Remuneration services
-Risk insurance
Dependency on Capital
Markets
31
* Correlations of quarterly Reported Profits Q1/2005–Q4/2015
Group Solvency by Financial Conglomerate Rules
EURm
12,000
(1
Group solvency ratio 193% / SI rules applied for Insurance Subsidiaries
10,000
8,000
6,000
59
4,000
3,770
2,000
0
881
If P&C
EURm
12,000
9,599
4,983
269
Mandatum Life
Sampo plc's
share of Nordea
Sampo plc
Total capital
requirement
Group
Solvency Capital
Group solvency ratio 145% / SII Standard Formula applied for Insurance Subsidiaries
10,000
8,000
59
6,000
3,770
4,000
2,000
0
10,294
7,114
1,212
2,073
If P&C
Mandatum Life
1) The Finnish Act is effective from 01/01/2016
Sampo plc's
share of Nordea
Sampo plc
Total capital
requirement
Group
32
Solvency Capital
Different Types of Investment Allocations
Total Group (MEUR)
20 211
19 226
18 688
19 373
14 000
12 000
11 827
11 778
11 516
11 395
10 000
8 000
6 716
6 705
6 667
6 503
6 000
4 000
1 667
2 000
743
1 311
669
03/15
Money Market
Long-Term Fixed Income
Equity
Private Equity
Other
9%
77%
13%
0%
0%
19%
39%
27%
4%
10%
06/15
79%
13%
6%
1%
1%
12%
75%
13%
0%
0%
19%
40%
26%
4%
11%
09/15
22%
29%
46%
1%
3%
14%
74%
12%
0%
0%
10%
50%
25%
4%
11%
Sampo
Plc
Mandatum
Life
If
P&C
Sampo
Plc
Mandatum
Life
If
P&C
Sampo
Plc
Mandatum
Life
If
P&C
Sampo
Plc
Mandatum
Life
If
P&C
0
12/15
15%
39%
43%
1%
3%
12%
74%
13%
0%
0%
8%
52%
26%
4%
11%
56%
27%
15%
0%
1%
33
Investments & Counterparty Exposures*
AAA
AA+ AA-
A+ A-
BBB+ BBB-
BB+ C
D
Non
Rated
Fixed Income
Total
Equities
Other
Basic Industry
-
34
0
38
153
-
64
289
173
-
-
Capital Goods
-
-
109
56
43
-
111
319
593
-
Consumer Products
-
136
215
154
81
-
91
677
662
-
Energy
-
81
9
36
42
-
272
439
11
Financial Institutions
-
2 583
2 632
637
261
-
10
6 123
Governments
170
-
-
-
1
-
-
171
Government Guaranteed
31.12.2015
Derivatives
(Counterparty Risk)
Total
Change from
30.9.2015
461
- 195
-
912
+ 84
-
1 339
+ 23
0
-
451
246
24
16
6 409
-
-
-
171
- 47
- 71
+ 426
104
55
-
-
-
-
-
158
-
-
-
158
-2
Health Care
-
-
67
41
59
-
32
198
101
-
-
299
-0
Insurance
-
-
11
87
4
-
100
202
3
38
-
242
+ 94
Media
-
-
18
-
14
-
48
79
-
-
-
79
-6
+ 91
Packaging
-
-
-
-
67
-
22
90
1
-
-
91
879
225
42
-
-
-
-
1 146
-
-
-
1 146
- 15
Real Estate
-
-
-
48
-
-
502
550
-
272
-
822
+ 30
Services
-
-
0
62
144
-
67
273
95
0
-
368
+ 58
Technology and Electronics
4
-
40
1
29
-
36
110
138
-
-
249
+ 50
Telecommunications
-
-
88
25
47
-
42
202
85
0
-
287
-7
Transportation
-
106
7
21
22
-
168
324
28
-
-
352
- 47
Utilities
-
-
25
314
104
-
77
519
-
-
-
519
-3
Others
-
-
-
-
12
-
9
21
1
63
-
85
+ 49
Public Sector, other
Asset-backed Securities
-
-
-
-
-
-
-
-
-
-
-
-
2 758
80
-
11
-
-
-
2 850
-
-
-
2 850
+ 155
Funds
-
-
-
-
-
-
108
108
1 293
663
-
2 064
- 22
Total
3 916
3 299
3 265
1 529
1 082
-
1 758
14 849
3 431
1 060
19 355
+ 646
Change from 30.9.2015
+ 112
+ 80
+ 251
+ 84
+ 12
-
+ 23
+ 561
+ 646
EURm
Covered Bonds
+ 111
-5
16
- 21
Note: Category Other includes private equity, unlisted equity and non-listed real estate. Category Derivatives includes only OTC derivatives and corresponding collaterals.
* In Exposure tables the calculation rules may differ slightly from Allocation tables in some areas.
+0
34
Fixed Income Investments in the Financial Sector*
Sweden
Finland
Norway
Denmark
the United States
Switzerland
the Netherlands
Canada
France
Germany
Iceland
Other
Total
Covered
bonds
1,691
162
693
218
Money
market
468
1,898
1
0
23
18
0
0.12
43
29
2,850
2,589
116
78
Long-term
Long-term
senior debt subord. debt
947
330
206
6
586
183
293
22
150
1
217
11
212
113
62
14
76
0
75
23
8
2,958
575
Total
3,436
2,273
1,462
649
229
228
213
113
99
94
75
102
%
38%
25%
16%
7%
3%
3%
2%
1%
1%
1%
1%
1%
8,973
100%
35
*Exposure tables vs. Allocation tables – small differences.
Sampo Group
Public Sector Fixed Income Investments ― no Periphery*
EURm
Sweden
Government
Government
guaranteed
159
Norway
Finland
Germany
55
11
Denmark
Total
821
981
234
234
73
127
71
82
32
32
Japan
Russia
Total
Public sector,
other
18
18
1
171
1
158
1,146
1,476
36
* Exposure tables vs. Allocation tables – small differences
Sampo Group
If P&C
Mandatum Life
Sampo Group
Sampo plc
Appendix
Basic Facts
3-10
11-19
20-28
29-36
37-43
44-57
37
Sampo plc
Straightforward Cash Flows & Strong Balance Sheet
Flow of Funds
Dividends
• If P&C
• Mandatum Life
• Nordea
Balance Sheet
Income
• Interest on Liquidity
• Income from other
investments
Assets EURm
739
CPs Issued
Investment assets
275
LT Senior Debt
-Fixed Income
-Equity & Private Eq.
Subordinated Loans
• Internal Administration Costs
Equity Holdings
• Discretionary Dividends for Shareholders
• Interest Expenses for Bondholders
Liabilities EURm
Liquidity
-Real Estate
Sampo plc
9,606
2
-Bonds Issued
248
579
7,928
305
-Private Placements
25
159
1,838
Subordinated Debt
Capital
0
7,159
2,370
-Undistributable
-Associated
5,557
-Distributable
85
1,997
-Pension Insurance Loans
-Subsidiaries
Other Assets
9,606
Other Liabilities
98
7,061
145
Key Credit Metrics well in Single A -range
Sampo plc
Gross Debt, EURm
Gross Debt to Equity
Financial Leverage*
*= Debt/(Debt+Equity)
31.12.2015
2,302
32%
24%
Sampo Group, EURm
Shareholders' Equity
Hybrid Bonds
Senior Debt
Financial leverage
Q4/2015
11,411
10
2,143
18.8%
Q3/2015
10,876
10
2,121
19.5%
38
Sampo plc
Dividends & Reported Profits
EURm
1300
1,226 *
2011
2012
2013
2014
1,229
2015
1,069
1100
900
2010
1,050
879
832
747 762 773
702 683
700
737
500
300
100
-100
17
-8 -10 -17 -20 -18 -14
Dividend income Operating expenses
-37
-70
-20 -26 -1
Net financial
expenses
Profit before taxes
* Parent Company is not equal to Holding Segment; Dividend Income includes also dividends from Private Equity investments
39
Sampo plc
Dividends Received by Payment Year
EURm
1,600
Low Net Debt vs. Stable Dividend Inflows
1,406
1,400
75
1,200
1,220
300
1,067
1,000
754
800
600
400
200
0
490
141
100
249
35
200
1,031
511
130
519
200
568
744
756
204
250
80
488
768
224
406
293
544
490
181
If
370
100
100
100
540
883
597
533
676
100
551
600
125
Mandatum Life
Banking*
*) Sampo Bank 2005-2006, Nordea 2007->
**) Nordea: a proposal to the AGM; Mandatum Life: planned in Q1/2016;
If P&C normally pays its dividend towards the end of the calendar year
40
Sampo plc
Sampo Group ― Conservative Leverage
EURm
40%
16,000
Sampo plc Net debt
14,000
Group NAV
12,000
30%
Group Equity
10,000
Net debt/NAV
35%
8,000
25%
6,000
20%
4,000
15%
2,000
41
Q1/16
Q1/15
Q1/14
Q1/13
Q1/12
Q1/11
Q1/10
Q1/09
Q1/08
Q1/07
Q1/06
Q1/16
Q1/15
Q1/14
Q1/13
Q1/12
Q1/11
Q1/10
Q1/09
Q1/08
0%
Q1/07
-4,000
Q1/06
5%
Q1/05
-2,000
Q1/05
10%
0
Sampo plc
Sampo plc Debt Instruments
Coupon
Swap
Effective
Rate
Maturity
Senior Bond 300 EURm (EMTN)
4.2500%
Euribor3M + 1.4727%
1.3807%
22.02.2016
4.2500%
Euribor3M + 2.7910%
2.6870%
27.02.2017
Senior Bond 2,000 SEKm (EMTN)
Stibor3M + 1.45%
---
1.0330%
29.05.2018
Stibor3M + 0.77%
---
0.3530%
28.05.2020
1.2500%
---
1.2950%
28.05.2020
1.5000%
---
1.5920%
16.09.2021
0.3100%
Average 3M
Instrument & Principal
CPs issued 300 EURm
Euribor + Margin
Public debt 2,143 EURm
1.4377%
Private placements 159 EURm
1.6111%
Total 2,302 EURm
1.4497%
EURm
800
600
400
200
0
2016
CPs
2017
2018
Senior under EMTN
2019
2020
2021
Senior Retail Private
42
Sampo plc
Sampo plc Key Credit Considerations
Stable Dividend Flows from Affiliated Companies with strong Brands
Diversification through Insurance & Banking in the Nordic Region
Conservative Financial Profile, strong Capitalization and Liquidity
Management with a proven Track Record in long-term Value Creation
Bondholder Value Created
43
Appendix
44-57
44
Appendix
Sampo Group’s Outlook for 2016
• Sampo Group’s business areas are expected to report good operating results
for 2016.
• However, the mark-to-market results are, particularly in life insurance, highly
dependent on capital market developments. The continuing low interest rate
level also creates a challenging environment for reinvestment in fixed income
instruments.
• The P&C insurance operations are expected to reach their long-term
combined ratio target of below 95 per cent in 2016 by a margin.
• Nordea’s contribution to the Group’s profit is expected to be significant.
45
Appendix
Principles of Investment Management
• Company specific needs form the basis for all investments
– Liabilities intensively analysed and modelled.
– Regulatory requirements.
• Strategy
– Absolute Return targets taking into account the liabilities and general business targets.
– Direct Investments into Nordic countries mainly, outside Nordics Funds mainly.
– No diversification for the sake of diversification.
• Centrally Managed
– Sampo plc Chief Investment Officer responsible for all investments, all portfolio
managers have a direct reporting line to him.
– Common infrastructure for investment administration and reporting.
– Investment strategies coordinated and streamlined, no overlapping activities
to prevent Group wide concentrations.
46
Appendix
Risk Management Principles
• Scope
– Sampo’s Board of Directors requires that all activities involving the exposure of any
Sampo Group company to risks, as well as activities controlling those risks, are
arranged to comply with these general guidelines and related instructions as well
as with applicable legislation and regulations
– The Board of Directors will supervise the risk taking and risk control activities
– The Principles apply to all Sampo Group companies
• The Key Objectives
– Balance between risks, capital and profits
– Cost efficiency and high quality processes
– Strategic and operational flexibility
• The Central Tasks
– Identification of risks
– Assessment of required capital
– Pricing of risks
– Managing risk exposures, capital positions and operative processes
– Measuring and reporting risks
47
For more detailed description of Sampo Group´s Risk Management Principles, see http://www.sampo.com/governance/internal-control/risk-management/
Appendix
Capital Management Framework at Operating Company Level
Capital
requirements by risks
Expected
profits
Regulatory
Capital
Requirement
”SCR”
•
•
•
Selfdefined
Potentially
Higher
Capital
Need
Realized
profits
Market
expectations
Paid Dividends
Size
of
buffer
Measurement
uncertainty
Own Funds
”OF”
Issued capital
instruments
Issuance
capacity
Other capital
components
Strategic
risks
48
Appendix
Capital Management Framework at Group Level
IF P&C
SCR
in SEK
Mandatum Life
SCR
in EUR
Profit
diversification
Group Capital
Requirements
in EUR
Sampo PLC’s
liquidity
capacity
Buffer
Sampo plc
CR
in EUR
Nordea
CR
in EUR
Issuance
capacity of
business
areas
Strategic
risks &
arrangements
Shareholders’
dividend
expectations
Consolidated
Group equity
Group
Solvency Capital
in EUR
Sectoral
items added
Intangibles &
other
deductables
SCR on Group
Translation risk
in EUR
49
Appendix
Sampo Group ― Through Structural Changes
to the Leading Nordic Financial Group
Mandatum Bank is merged
into Sampo-Leonia, and the
Group’s name is shortened
to Sampo.
2000
2001
Sampo Insurance Company
and Leonia Bank merge into
Sampo-Leonia Financial Group.
• Business areas:
P&C insurance, Long-term
savings (life insurance, asset
management, mutual funds);
Banking, Investment banking
2002
Sampo divests Sampo Bank
to Danske Bank.
• Business areas:
P&C insurance, Life insurance
& Wealth Management
2004
2007
Sampo’s P&C insurance
operations are merged with If 2002).
Following the transaction, Sampo
owns 38 per cent of If. If becomes
fully owned by Sampo (2004).
• Business areas:
P&C insurance, Long-term savings,
Banking
Sampo Group’s(If P&Cʼs)
• Topdanmark holding exceeds
23%. Topdanmark becomes
If´s associated company.
2010
2011
Sampo’s Nordea
holding exceeds 20%.
• Nordea becomes an
associated company.
2012
Sampo Group
(Mandatum Life) acquires
Suomi Mutualʼs With-Profit
Group Pension portfolio.
2013
2014
2015
Sampo Group (If P&C)
acquires Tryg’s Finnish
Business.
• If P&C signs a partnership
agreement with Nordea.
50
2016
Appendix
Financial Strength Rating History
Moodyʼs If P&C
S&P If P&C
Moodyʼs Sampo plc
Stable Nov 08
Positive May 06
Stable May 04
Possible upgrade Feb 04
Stable Apr 03
A/
A2
Negative Aug 02
A+/
A1
Stable Feb 02
AA-/
Aa3
Possible downgrade Jan 03
If P&C Insurance Ltd (Sweden), If P&C Insurance Company Ltd (Finland),
Sampo plc
A-/
A3
BBB+/
Baa1
Apr 04 First-time
issuer rating
BBB/
Baa2
2002
2003
2004
2005
2006
The Sampo Groupʼs P&C insurance companies became part of If in January 2002.
2007
2008
2009
2010
-11
-12
-13
-14
51
-15
-16
Appendix
IF P&C Quarterly Results and C/R
EURm
Q4/15 Q3/15 Q2/15 Q1/15 Q4/14 Q3/14 Q2/14 Q1/14 Q4/13 Q3/13 Q2/13 Q1/13
Premiums earned
1,077 1,087 1,103 1,076 1,108 1,124 1,122 1,104 1,112 1,139 1,140 1,115
Claims incurred
-764 -735 -864 -780 -776 -793 -783 -811 -791 -802 -800 -824
Operating expenses
-29
-180
-189
-183
-187
-186
-186
-191
-188
-190
-180 -176
Other technical income
0
0
-1
-1
0
1
1
1
0
0
1
0
and expenses
Allocated investment
return transferred from
5
7
9
5
7
10
15
12
16
17
20
2
the non-technical
account
Technical result
180
217
124
147
155
162
124
148
161
170
122
135
Investment result
68
99
84
81
75
139
88
104
89
115
102
75
Allocated investment
return transferred to
-14
-17
-18
-16
-18
-21
-27
-25
-30
-31
-34
-11
the technical account
Other income and
11
11
10
8
16
9
9
3
6
15
14
5
expenses
Operating result
245
310
200
219
228
289
194
230
227
269
204
204
Risk ratio, %
65.2 61.9 72.7 66.6 64.4 64.7 64.0 67.5 65.1 64.7 64.2 67.7
Combined ratio, %
87.7 83.8 80.9 89.2 87.1 86.9 86.5 90.3 87.9 87.2 86.7 90.9
52
Appendix
IF Regulatory Solvency Capital & Ratio*
EURm
4,500
88%
4,000
3,500
3,000
2,500
%
100%
70%
74%
77%
71%
75%
79%
81%
72%
82%
75%
80%
66%
60%
54%
2,000
40%
1,500
1,000
20%
500
0
0%
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Solvency capital (lhs)
* Solvency ratio, (IFRS) % =
Solvency ratio (rhs)
+ solvency capital
+ premiums earned from 12 months
x 100%
53
Appendix
IF P&C Reinsurance Programmes
IF is using reinsurance to:
- Utilize its own capital base efficiently and reduce cost of capital
- Limit large fluctuations of underwriting results
- Get access to reinsurers’ competence base
IF has the following Reinsurance Programmes in place
In Millions
Capacity
Retention
In Millions
Catastrophe per Property per
Event
Risk
Casualty
Personal
Accident
SEK 6,300 SEK 2,000 / 3,500
SEK 500/€50/$50 SEK 1,100
SEK 250
Marine Hull
Reporter
SEK 250
SEK 100/€10/$15
SEK 100
Motor TPL
Cargo Reporter
Unlimited
SEK 850
SEK 100
SEK 100
Small Vessels Marine Hull I.V.Marine Hull WarUS Terrorism
Clash Cover
Reporter
Risk Reporter Per risk
Capacity
SEK 400
SEK 250
SEK 310
USD 60
USD 200
Retention
SEK 100
SEK 100
SEK 100
USD 0,25
USD 25
• Largest & most diversified
portfolio in the Nordics
• Focus purely on underwriting
• Specialised Reinsurance Unit
• Reinsurance partners having
reinsurance as core business
• Relatively high retentions
• Stable reinsurance program
• Efficient pricing and terms
54
Appendix
Mandatum Life Regulatory Solvency Ratio*
30%
27.7% 27.6%
25.8%
25%
20%
21.3%
17.7%
20.9%
20.1%
22.9% 23.6%
18.5%
16.5%
15%
10%
7.9%
5%
0%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
x 100%
* Solvency ratio, % of technical provision, (IFRS) = + solvency capital
+ liabilities for insurance and investment contracts
55
- reinsurers’ share of insurance liabilities
- 75% x technical provisions relating to Unit-linked insurance
1,200
1,000
800
600
400
200
122
1,400
885
21
883
36
847
89
781
320
833
356
818
425
832
358
592
347
878
261
730
245
960
207
1,071
166
1,003
242
949
118
566
112
1,029
263
1,037
218
1,099
217
922
254
1,059
244
1,041
198
1,048
186
1,021
171
1,006
180
1,106
158
935
135
1,126
112
1,157
129
1,408
1,235
103
1,033
112
1,027
142
EURm
1,600
1Q08
2Q08
3Q08
4Q08
1Q09
2Q09
3Q09
4Q09
1Q10
2Q10
3Q10
4Q10
1Q11
2Q11
3Q11
4Q11
1Q12
2Q12
3Q12
4Q12
Q113
Q213
Q313
Q413
Q114
Q214
Q314
Q414
Q115
Q215
Q315
Q415
Appendix
Nordea
Profitable & The Most Diversified Nordic Bank
Restructuring/impairment charges
Loan losses
Operating profit
0
56
Appendix
Nordea BV on Consolidated Balance Sheet
Nordea in Sampo Group’s B/S
EURm
Acquisition price
5,557.3
Retained earnings
1,570.7
Accumulated other changes in Nordea’s equity
-62.7
Share of Nordea’s net profit
778.2
Amortisation
-35.4
Deferred tax
Dividends
-533.5
2.8
Share of Nordea’s other changes in equity
6.7
Total
* As of 31/12/2015
Acquisition price
Book value
Market Value*
EUR
6.46
8.49
10.15
7.8
Share of Nordea’s other comprehensive income
Share of Nordea’s goodwill change
Figures Per Share
No. of shares 860,440,497
13.6
7,305.5
57

Debt Investor Presentation Q4/2015

Transcription

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