Swedbanks first quarter 2014 results

Michael Wolf, CEO Gran Bronner, CFO Anders Karlsson, CRO

Swedbank

Market position

Stronger market position in southern Sweden

Acquisition of 100 per cent of Sparbanken resund Creation of Swedens largest savings bank Sparbanken Skne

Swedbank will own 22 per cent of Sparbanken Skne

Significant financial upside for Swedbank Cost and capital synergies

Awaiting approval from the Swedish FSA

Number of branches:
Swedbank: 27 Sparbanken resund: 16 Sparbanken Skne: 45

Swedbank

Swedish Banking

Stable results
SEKm Net interest income Net commissions Total income Total expenses Q1 14 3 314 1 649 5 422 2 443 2 979 31 Q4 13 3 448 1 649 5 536 2 526 3 010 140 Q1 13 3 331 1 589 5 378 2 399 2 979 55 Q/Q - 134 0 -114 -83 -23 -109 Y/Y -17 60 44 44 0 -24

Lower deposit margins

Stibor Number of days effect

Profit before impairments

Credit impairments

Stable mortgage margins

Good economic activity supports fee income

Solid asset quality

ROE, % C/I ratio

28.3 0.45

27.7 0.46

28.1 0.45

Large Corporates & Institutions

Strong Return on Equity

SEKm Net interest income Net commissions Net gains and losses Total income Total expenses Profit before impairments Credit impairments Q1 14 867 630 565 2 099 834 1 265 -30 Q4 13 889 558 491 1 986 881 1 105 5 Q1 13 783 420 579 1 813 733 1 080 74 Q/Q -22 72 74 113 -47 160 -35 Y/Y 84 210 -14 286 101 185 -104

Strong client activity within Debt Capital Markets and Corporate finance Positive deposit volume trend

Solid asset quality

Planned cost increases

ROE, % C/I ratio

26.9 0.40

20.1 0.44

16.8 0.40

Baltic Banking

Solid performance
SEKm Net interest income Net commissions Total income Total expenses Q1 14 874 429 1 465 607 858 -101 Q4 13 844 454 1 512 664 848 -177 Q1 13 742 388 1 282 589 693 -70 Q/Q 30 -25 -47 -57 10 -76 Y/Y 132 41 183 18 165 -31

Continued re-pricing

Good underlying customer activity

Latvian EUR-entry
Decreased risk Negative income impact

Profit before impairments

Credit impairments

ROE, % C/I ratio

15.2 0.41

15.0 0.44

12.6 0.46

Continued net recoveries Uncertain growth prospect due to geopolitical situation in Russia and Ukraine
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Group results

Stable quarter
SEKm Net interest income Net commission income Net gains and losses Total income Total expenses Profit before impairments Credit impairments Other impairments Tax Profit from continuing operations

Q1 14 5 483 2 693 345 9 320 4 226 5 094 -100 135 1 074 3 985

Q4 13 5 626 2 699 461 9 652 4 484 5 168 -32 323 1 212 3 665

Q1 13 5 353 2 388 557 9 082 4 043 5 039 60 85 976 3 918

Q/Q Y/Y -143 -6 -116 -332 -258 -74 -68 -188 -138 320 130 305 -212 238 183 55 -160 50 98 67

Mixed margin development

- Lower deposit margins - Stable mortgage margins

Continued solid asset quality

Risk position enables competitive funding Continued customer and cost focus

ROE continuing operations, % Cost/income ratio CET1 Capital ratio, %

14.6 0.45 18.3

13.6 0.46 18.3

15.3 0.45 16.4

Asset quality

Strong asset quality

Legacy impaired portfolios almost worked-out

Ektornet continued asset sales

Russia and Ukraine exited limited remaining exposures
Credit impairments, SEKm Swedish Banking Large Corporates & Institutions Baltic Banking Group Functions & Other Swedbank Group

Q1 14 31 -30 -101 0 -100

Q4 13 140 5 -177 0 -32

Q1 13 55 74 -70 1 60

Impaired loans, SEKbn

45 40 35 30 25

20 15 10
5 0

* Russia and Ukraine reported as discontinued operations.

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Swedbanks first quarter 2014 results

Q&A

Appendix

Expenses

Focus on customer activities

Flat expenses target for 2014

Ektornet Customer IT related development cost

Group functions

Efficiency measures

Expenses Expenses 2012 2013

Expenses Expenses 2013 2014

10

Capital

Regulatory uncertainty higher capital requirements

16.5 - ? %

Countercyclical buffer
Other?

RW floor on mortgages
25% Risk weight floor on Swedish mortgages
15% Risk weight floor on Swedish mortgages

Pillar 2

Hard limits vs buffers

Leverage ratio corporate risk weights

0-2.5% Countercyclical buffer

12% Minimum CET1 (Pillar 1) requirement (incl. SIFI-buffer and Capital conservation buffer)

CET1 ratio

11

Asset quality

Conservative provision ratio

SEKm
20 000 64% 65%

62%
57% 54%

60%

Provision ratio, % Swedish Banking LC&I Baltic Banking Group

Q114 76 196 51 60

53%

54%

15 000

2 040 10 000 1 774

1 545 5 000
10 951 9 934 7 077 4 429 4 047 1 420

1 398

1 325 1 256 3 570 Q313* 2 818 Q413* 1 238 2 514 Q114*

0
Q212 Q312 Q412 Q113* Q213*

Individual provisions

Portfolio provisions

Provision ratio

* Russia and Ukraine reported as discontinued operations

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Credit portfolio Large Corporates & Institutions

Shipping and offshore

Lending exposure to Shipping & Offshore sector of SEK 25.0bn
- Portfolio duration 3.77 years (weighted on commitments) - Average fleet age 7 years - Strong employment profiles
SEKbn 30 24 20 23 26 25 26 25 4

Shipping and Offshore

10 16 0

Q4-12

Q1-13 Q2-13 Q3-13 Q4-13 Offshore Tanker Other

Q1-14

Shipping and Offshore Portfolio by subsegment, SEKbn

RORO Container Dry bulk Gas (LNG/LPG) Crude oil Product Chemical Floating production Accommodation Supply Oil service Drilling & exploration Cruise 1.8

Shipping and Offshore Portfolio by currency, SEKbn

JPY

0.7 0.2
3.0 0.7 2.4 0.6 1.5 1.3 Q1-14 Q4-13

NOK

USD

Q1-14
Q4-13

3.4
1.5 7.4 0.5 4 6 8 10

EUR

SEK 0 5 10 15 20 25
13

0 2 Source: Swedbank, Mar 31, 2014

Liquidity and funding

Lower funding needs

LCR 144% (Swedish FSA definition FFFS 2012:6) NSFR 89% / 102% (Basel committee) Issued SEK 36bn of term-funding in Q1 2014 FY 2014 funding plan of SEK 120bn Term funding issuance completed and planned
SEKbn
120 100 80 60 Covered bonds Senior unsecured

40
20

Source: Swedbank, Mar 31, 2014, nominal amounts

14

Liquidity and funding

Long-term funding maturity profile

Funding plan of SEK 120bn to meet next 12 months nominal SEK 125bn maturities

Long-term funding maturity profile, by funding source

SEKbn 200

150

Government guaranteed debt Senior unsecured debt Covered bonds

100

50

0 2014 2015 2016 2017 2018 2019 2020-

Source: Swedbank Mar 31, 2014

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Liquidity and funding

Prefunded in excess of 12 months

SEKbn

250

200

150

100

50

0
0 20 40 60 80 100 120 140 160 180 200 220 240 260 280 300 320 340 365

Days forward

Source: Swedbank Mar 31, 2014

16

Swedish housing and mortgage market

Real estate prices Sweden 12-month development

Single-family homes1 12M
Jan/13 Feb/13 Mar/13 Apr/13 May/13 Jun/13 Jul/13 Aug/13 Sep/13 Oct/13 Nov/13 Dec/13 3% 4% 3% 2% 4% 4% 4% 5% 5% 6% 4% 4%

Tenant-owner rights2 12M

7% 7% 7% 8% 8% 10% 9% 11% 11% 11% 13% 13%

Combined3 12M
5% 5% 5% 4% 5% 6% 6% 7% 7% 8% 7% 7%

Source: Valuegard www.valuegard.se (Based on data from Mklarstatistik), 1 HOXHOUSESWE, 2 HOXFLATSWE, 3 HOXSWE
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1 000

1 200

1 800

1 400

1 600

200

400

600

800

1 000

1 200

1 800

1 400

1 600

200

400

600

800

Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10
Nr.of deals

Jan-05 Jul-05 Jan-06

Real estate prices

EUR/m2 /Nr of deals

EUR/m2 /Nr of deals

Jul-06
Jan-07 Jul-07

Jul-08
Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14
EUR/m2

Baltic countries

Nr.of deals

Vilnius
Jul-10

Tallinn

EUR/m2

Jul-12
Jan-13 Jul-13 Jan-14

1 000

1 200

1 400

1 600

1 800

400

600

800

200 0
Jan-05

Jul-05
Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08

EUR/m2 /Nr of deals

Nr.of deals EUR/m2

Riga

Jan-09

Jul-09
Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13

Jul-13
Jan-14
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