Net commission income EURm QoQ: 405 388 397 500 379 60 49 47 � Up 2% 366 47 35 40 40 44 28 � Strong payment commissions 20 400 88 90 90 total transactions up 5% 88 – 87 � Asset Mgmt commissions 129 300 124 127 120 114 mgmt fees stable – 200 transaction fees slightly down – 200 199 194 192 191 � Brokerage maintained despite 100 lower volumes 0 H1oH1: -80 -84 -91 -94 -95 � Up 12% -100 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 strong growth in all key areas – Payments & deposits Asset mgmt Lending Brokerage Other Expenses 26
Trading QoQ: EURm 180 � Reduced to EUR 104m due to: 160 – lower customer activity 156 155 140 – challenging market conditions 130 120 125 100 104 80 H1oH1: 60 � Down 17% on high level last 40 year 20 0 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 27
Expenses EURm QoQ: 973 1000 � Down 3% 46 902 873 881 416 849 15 363 15 350 � Staff costs down 7% 370 800 378 continued reduction of FTEs – lower variable salaries – 600 � Other expenses up 2% 539 531 511 488 456 higher marketing 400 – H1oH1: 200 � Down 5% 0 � Number of FTE’s down 11% Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 Staff costs Other Profit sharing 28
Expenses - development Q2/04 vs. Q1/04 H1/04 vs. H1/03 Reported Underlying Reported Underlying Staff costs -7% -5% -11% -6% Other +2% +1% -2% -6% expenses Total -3% -2% -5% -6% expenses � Underlying expenses are adjusted for: – restructuring expenses – variable salaries – profit sharing – F/X effects 29
Development of FTEs � YoY down approx. 3,600 FTEs of which 1,100 outsourced 35,000 – Q2 reduction 600 of which 170 32,862 32,140 30,000 outsourced 30,674 29,880 29,289 FTEs Q2/04 Q1/04 2003 25,000 Retail 17,638 17,882 18,320 20,000 CIB 1,941 1,974 2,102 15,000 AM & Life 1,796 1,797 1,796 10,000 GPT 6,235 6,554 6,772 5,000 Other 1,679 1,673 1,684 0 Total 29,289 29,880 30,674 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 Change -2,0% -2.6% End of period 30
Loan losses EURm QoQ: 100 � Positive net provisions 90 92 89 – reversals exceeded new 80 84 provisions 70 � No major problem areas 60 50 40 42 H1oH1: 30 � Loan loss ratio down to 5bp 20 from 26bp annualised 10 � No new losses in fish farming 0 -3 -10 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 31
Investment earnings, banking EURm QoQ: 100 � Loss of EUR 61m resulting 80 from 81 60 – difficult market conditions 62 40 – loss on holding in OMHEX AB 33 20 27 0 H1oH1: -20 � Reduced to EUR 1m -40 – very high level last year -61 – mixed market conditions this -60 year -80 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 32
Operating profit, life insurance EURm QoQ: 60 � Up 9% 50 � Stabilisation at high level 51 50 47 � Investment return decreased 40 40 40 � Decreased financial buffers 30 20 H1oH1: � Improved profit reflecting the 10 changed business model 0 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 33
Income statement summary EURm, Q2/04 Q1/04 Chg % Total income 1,404 1,421 -1 Total expenses -849 -873 -3 Loan losses, net 3 -42 -107 Equity method 9 9 0 Profit before inv. earnings and 567 515 10 insurance Investment earnings, banking -61 62 -198 Operating profit, life insurance 51 47 9 Goodwill amortisation and -41 -40 2 write-downs Operating profit 516 584 -12 34
Income statement summary EURm Jan-June Jan-June Chg 2004 2003 % Total income 2,825 2,837 0 Total expenses -1,722 -1,819 -5 Loan losses, net -39 -190 -79 Equity method 18 33 -45 Profit before inv. earnings and 1,082 861 26 insurance Investment earnings, banking 1 110 -99 Operating profit, life insurance 98 69 42 Goodwill amortisation and -81 -81 0 write-downs Operating profit 1,100 959 15 35
Real estate divestment process completed � A gain of EUR 300m is reflected in Q2 accounts below operating profit – write-down of EUR 115m in Q4 2003 � Reduced EC by EUR 260m and improved capital effiency � Lower RWA’s and improved Tier 1 capital � Nordea owns no major properties � Going forward the recurring financial effect of the divestments will be positive 36
Net profit EURm QoQ: 700 � Up 59% 664 600 628 � Gain of EUR 300m increased 500 profit 400 418 405 300 200 H1oH1: 202 � Up 64% 100 0 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 37
Key figures Earnings per share Return on equity (excl. goodwill) EUR % 30 0.25 0.24 28.1 25 26.5 0.20 0.21 20 0.15 18.2 18.1 0.15 0.14 15 0.10 10 9.7 0.07 0.05 5 0.00 0 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 EPS H1 2004 EUR 0.39 RoE H1 2004 23.1% EPS H1 2004 adjusted for real EUR 0.28 RoE H1 2004 adjusted for real 17.3% estate gain estate gain 38
39 Q Earnings per share – 12 months rolling 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 EUR 1 / 2 0 0 0 0 Q 2 / 2 0 0 0 Q 3 / 2 0 0 0 Q 4 / 2 0 0 0 Q 1 / 2 0 0 1 Q 2 / 2 0 0 1 Q 3 / 2 0 0 1 Q 4 / 2 0 0 1 Q 1 / 2 0 0 2 Q 2 / 2 0 0 2 Q 3 / 2 0 0 2 Q 4 / 2 0 0 2 Q 1 / 2 0 0 3 Q 2 / 2 0 0 Q 3 3 / 2 0 0 3 Q 4 / 2 0 0 3 Q 1 / 2 0 0 4 Q 2 / 2 0 0 4
Balance sheet - key items Change, 12 Q2/04 2003 Q2/03 EURbn months % Lending 156 146 147 6 Deposits 98 96 91 7 Shareholders’ equity 12 12 12 2 Total assets 262 262 270 -3 Risk-weighted assets 140 134 135 4 End of period 40
Lending and deposits Lending Deposits EURbn EURbn 160 100 156 98 96 140 149 148 93 147 146 92 91 80 120 100 60 80 40 60 40 20 20 0 0 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 End of period 41
Capital position Tier 1 ratio % � RWA’s increased 8 – higher business volumes 7 7.5 7.5 7.3 7.0 6.7 6 � Tier 1 capital increased 5 – half-year profit included 4 � Total capital ratio 9.3% 3 2 1 0 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 End of period 42
Result by business area EURm 500 456 400 433 300 200 154 100 89 60 58 53 57 55 0 -27 -73 -131 -100 -200 Retail CIB Asset Mgmt* Life* Group Group Treasury Functions *Product result for Asset Management and Life and Eliminations Q1/04 Q2/04 43
Retail Banking operating profit EURm � Increased lending volumes 500 � SME loan growth continued 450 456 433 400 428 � Strong increase in non-interest 395 350 income 376 300 � Positive net loan losses 250 200 150 100 50 Key ratios Q2/04 Q1/04 0 C/I ratio, % 58 58 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 RoE, % 27 26 44
Lending to households - mortgages EURbn 60 Market shares, % 50 52.6 Q2/04 2003 2002 50.0 48.9 48.2 45.7 DK 14.0 13.1 12.1 40 FI 32.5 32.7 n.a 30 NO 10.9 10.5 10.0 SE 16.1 15.8 15.6 20 10 0 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 45
Retail Banking, lending and deposit margins % Quarterly averages 2.6 � Overall stable lending 2.4 margins 2.2 – household margins slightly 2.0 1.8 down 1.6 – SME margins stable 1.4 1.2 � Declining deposit margins 1.0 0.8 0.6 0.4 0.2 0.0 Q1/02 Q2/02 Q3/02 Q4/02 Q1/03 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 Lending to corporates Lending to households Morgage lending to households Deposits from corporates Deposits from households 46
CIB operating profit EURm 180 � Increased lending volumes � Markets income down 150 154 – lower customer activity 131 120 – challenging market conditions 100 90 � Stable development in other areas 92 85 � Positive net loan losses 60 30 Key ratios Q2/04 Q1/04 0 C/I ratio, % 64 48 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 RoE, % 14 25 47
Asset Management product result EURm 80 � AuM up EUR 1.4bn to EUR 70 123.3bn 60 – net inflow of EUR 1.4bn in Q1 60 60 58 50 � Asset appreciation flat 48 � Asset Mgmt commissions 40 41 – mgmt fees stable 30 – transaction fees slightly down 20 Key ratios 10 Q2/04 Q1/04 C/I ratio, % 57 56 0 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 AuM, EURbn 123 122 48
Assets under management EURbn � Strong distribution capacity 140 121.9 123.3 120 113 � Nordea market leader within 107 102 retail funds in the Nordic 100 region 80 – holds 19% of all Nordic 60 investment fund assets 40 � Strong sales through 20 European fund distribution 0 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 Nordic retail funds Nordic private banking International wealth mgmt & funds Institutional clients Life & pensions 49
Life Insurance, product result EURm 80 � Stabilisation at high level 70 � Decreased financial buffers 60 � Effect of changed business 57 model increasingly visible 50 53 52 40 44 43 30 20 10 Key ratios Q2/04 Q1/04 Inv return, % -0.4 3.2 0 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 Financial 4.9 5.6 buffers*, % 50 * Financial buffers in % of provisions
Group Treasury operating profit EURm 100 � Investment earnings down 91 80 – Influenced by difficult market conditions 60 62 55 – loss on holding in OMHEX AB 40 � Improved result in Group Funding 35 20 0 -27 -20 -40 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 51
Group Functions and Eliminations QoQ: Q2/04 Q1/04 � Unallocated expenses from Income -16 -5 GPT reduced Expenses -26 -66 General: Loan losses -8 -35 � Expenses in Group functions not defined as service offered Equity method 2 -1 to business areas � Loan losses are central 7 Operating profit, Life 11 provisions Goodwill -32 -31 � Depreciation of goodwill related to the creation of Nordea Operating profit -73 -131 52
Outlook 2004 � Outlook for economic growth improved � Short-term interest rates lowered in Q2 – likely to have bottomed out � Total income 2004 expected to exceed 2003 – despite high non-recurring revenues 2003 � Increased business volumes expected – primarily household sector – potential for increased activity in SME sector � Costs in 2004 expected to remain clearly below 2003 � Loan loss ratio expected to be substantially lower than 2003 53
54
Loan portfolio by customer category* EURbn 100 88 87 85 85 85 84 84 83 83 82 82 80 79 78 77 80 60 53 50 49 48 46 44 44 42 42 41 39 37 37 36 40 35 17 16 16 20 15 15 14 14 14 14 13 13 12 12 12 10 0 Q4/00 Q1/01 Q2/01 Q3/01 Q4/01 Q1/02 Q2/02 Q3/02 Q4/02 Q1/03 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 Corparate lending Housing loans Consumer loans End of period *Excluding public sector 55
Loan portfolio by customer group Q2/04, EUR 155.5bn Q2/03, EUR 147.0bn Public Public sector sector 2% 2% Household Household customers customers Companies Companies 41% 45% 53% 57% 56
Lending to household customers End of Q2/04 EUR 69.5bn � Continued strong growth in Other loans mortgage lending 24% � Other loans comprise consumer credits – investment credits – car financing – overdraft facilities – credit cards – Housing loans 76% 57
Lending to companies by industry End of Q2/04 EUR 82.9 bn Shipping & Offshore Construction Transport and 5% 3% communication 5% Real estate 27% Agriculture & Fishing 6% Renting, consulting and other services 7% Other companies 8% Manufacturing 16% Commerce and services Finance 11% 12% 58
Loan portfolio in figures EURbn Q2/04 Q1/04 Q4/03 Q3/03 Q2/03 Household customers 63.5 69.5 66.3 64.7 60.2 Real estate 22.4 20.9 21.2 22.0 22.0 Construction 2.8 2.7 2.6 2.5 2.8 Transport, communication 4.3 4.3 4.4 4.6 3.8 Trade and services 9.3 8.8 8.7 9.1 9.1 Manufacturing 12.9 11.9 12.5 13.2 12.5 Finance 9.6 8.7 8.3 11.2 12.2 Renting, Consulting and other services 6.2 5.9 5.7 6.1 7.0 Other companies/public sector 9.4 9.4 9.5 8.3 8.6 Agriculture & Fishing 4.9 5.0 4.3 4.3 4.3 Shipping & Offshore 4.2 4.1 3.7 3.9 4.5 Total 155.5 148.0 145.6 148.7 147.0 End of period 59
Lending by geographical area End of Q2/04 EUR 155.5bn Latin America USA 0.7% Other non OECD 1.1% 0.6% Nordic countries Other OECD and P&B 0.5% 92.7% Other Asia 7.3% 0.5% Other EU countries Nordic countries and P&B 3.9% Denmark 41.0 � Finland 33.4 � Norway 23.5 � Sweden 44.5 � P&B 1.8 � 60
Transfer risk exposure EURm . End of Q2/04 Asia 527 Latin America 288 -of which China 200 -of which Brazil 192 South Korea 130 Mexico 39 Indonesia 21 Chile 5 Panama 13 Argentina 1 Middle East 367 -of which Iran 173 Turkey 62 61
Nordea fisheries financing End of Q2/04 Total exposure approx. EUR 2.0 bn Fish processing/ � Total outstanding EUR 1.7bn export 22% � Mainly Norwegian exposure Fish farming � Fish farming 40% – represents approx. 0.5% of total loan book – increases in salmon prices in 2004 – no provisions in 2004 Fishing vessels 38% 62
Nordea shipping portfolio Distribution by type of vessel End of Q2/04 Total exposure approx. EUR 6.1bn Reefers Combined 4% vessels Other dry cargo 1% 4% � Outstanding, EUR 5.4bn Bulkers 15% Pure car carries � Well diversified portfolio by 5% Ferries type of vessel 5% Misc. loans 13% � Focus on large industrial Cruise 7% players � Exposure split approx Chemical 55% / 45% Nordic / Int’l. tankers Crude tankers 7% 11% Liners 8% Product tankers Gas tankers 11% 9% 63
Nordea real estate financing portfolio End of Q2/04 Total exposure approx. EUR 22.4bn Denmark 8.7% � Largest industry exposure Sweden Norway 49.2% � Relatively large and financially 19.6% strong companies � High level of collateral coverage � Lending to residential real estate companies approx 50% Finland � Dominantly Swedish exposure 22.5% 64
Impaired loans EURm. End of period Q2/04 Q1/04 Q4/03 Q3/03 Q2/03 Impaired loans, gross 2,563 2,615 2,649 2,916 2,851 Provisions 1,898 1,929 -1,936 -2,072 -2,015 Of which: Specific provisions -1,406 -1,449 -1,468 -1,624 -1,571 Appraised by category -55 -60 -62 -64 -65 General provisions -436 -420 -406 -384 -379 Impaired loans, net 665 686 713 844 836 Transfer risk reserve 97 100 99 105 109 Provisions/impaired loans, gross (%) 74 74 73 71 71 Impaired loans,net/lending (%) 0.43 0.46 0.49 0.57 0.57 65
Impaired loans EURm. End of Q2/04 Gross Provisons Net Household customers 531 342 189 Real estate 189 141 48 Construction 72 62 10 190 Transport, communication 246 56 Trade and services 217 177 40 Manufacturing 282 228 54 Finance 73 58 15 Renting, Consulting and other services 265 178 87 Other companies 444 307 137 Public sector 1 1 0 Agriculture & Fishing 178 157 21 Shipping & Offshore 65 57 8 Total 2,563 1,898 665 66
Loan losses EURm QoQ: 300 � Positive net provisions 246 229 221 – reversals exceeded new 200 provisions 128 129 � No major problem areas 92 89 84 100 42 0 H1oH1: -3 � Loan loss ratio down to 5bp -100 from 26bp annualised -86 -132 -132 � No new losses in fish farming -145 -154 -200 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 Gross Reversals Net 67
Comments on certain industries Real estate � Vacancy rates for office buildings high particularly in the Stockholm region � Rent levels down from peak but still higher than original levels 3-5 years ago � Low interest rates help secure cash flow and secondary market values � New construction volumes adjusted to decreased demand � Large foreign interest in Nordic property market � Residential part of portfolio performing strongly 68
Comments on certain industries Shipping and Offshore industry � China the driving force for shipping boom � Bulk market particularly strong � Tanker market strong but volatile � Crusing market recovering from global uncertainties � Nordea´s exposure well diversified with modern ships and globally competitive companies � Restructuring and consolidation of industry continue 69
70
Economic capital (EC) � EC is the capital required by Nordea to cover unexpected losses � 5 different risk categories are incorporated � The measurement period is one year � The confidence level is 99.97% � The economic capital may change over time due to: – composition of risk exposures – changes in parameters � Economic capital is used for – risk management – performance measurement – capital allocation 71
Economic capital EURbn 10 � Reduced EC due to 9 divestment of real estate 9.1 9.0 8.9 portfolio 8.7 8 8.4 7 � Market risk reduced within Life and Treasury 6 5 � Increased lending 4 3 2 1 0 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 72
Economic capital per business area End of Q2/04 Treasury Other Q2/04 EC per business area, 5% 5% Asset Mgmt EURbn & Life Retail Banking 4.9 11% CIB 1.7 Asset Mgmt 0.1 Retail Life 0.8 58% CIB 21% Treasury 0.4 Other 0.5 Total 8.4 73
Distribution of economic capital - by risk category End of Q2/04 Life risk 1% Operational risk 9% Business risk 11% Market risk 16% Credit risk 63% 74
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Benefiting from Developing Nordea One bank the Nordic vision Adjusting to changed market conditions Resuming top-line growth 2003 Focus, speed and performance Changes of business models Divestment of non-core assets Shaping the 2002 Reduction of complexity new reality Customer organisation, customer strategy and 2001 customer relation Planning and performance management Embarking Business organisation and management on the Nordic vision 2000 Name, brand and values The complex point of departure 76
Mission Making it possible Vision We will be valued as the leading financial services group in the Nordic and Baltic markets with a substantial growth potential. We will be in the top league or show superior profitable growth in every market and product area in which we choose to compete. We will have the leading multichannel distribution with a top world ranking in e-based financial solutions and a high level of use of our e-services We will be a good corporate citizen ensuring confidence and trust Corporate values and key words Focus. We concentrate on creating value for our customers and shareholders. We contrentrate on our strengths and core activities, and we discontinue activities when needed Speed . We provide a broad set of easily accessible and competitive financial services and We are quick, adjust to market conditions and do not hesitate to execute decisions made. Performance. We aim to deliver better solutions and results than our competitors We continuosly improve in everything we do, and we deliver on our promises 77
Strategic themes 2004 Sustainable growth of economic profit Ensure operational Ensure capital Ensure stable and excellence, strict cost profitable growth of efficiency and high management and income credit portfolio quality reduced complexity Attract, develop and retain highly motivated, competent and performance oriented employees 78
Strategic themes firmly anchored throughout the Group Asset Management & Life Group / Group functions Retail Banking Corp. and Inst. Banking • Increase sales to all existing • Increase share of wallet • Capture share of growth in customers • Further enhance position the long-term savings and • Acquire new profitable among large corporate life area Ensure stable and customers in Sweden • Grow economic profit in Life customers profitable growth of • Increase focus on Financial & Pensions at low volatility income • Sell more through all Institutions channels: Branches, Netbank and Contact Centres • Sell products in bundles • Standardise service • Centralisation and • Implement common • Realise full potential of the concepts consolidation of production solutions existing cost saving Ensure operational • Streamline support functions processes • Encourage the customers to initiatives and harvest full excellence, strict cost • Ensure continuous product • Centralisation and use Netbank and Contact benefits management and range management consolidation of Centres • Increase organisational reduced complexity • Handle customers according efficiency • Leverage on existing administrative processes to segment-based strategy products/processes • Selective use of sourcing • Enforce strict cost alternatives management • Limited use of balance • Proactively manage • Complete divestment of real • Use economic profit to sheet compliance and operational estate determine individual Ensure capital efficiency • Price according to risk risk • Roll-out of economic corporate customer strategy and high credit portfolio • Proactive handling of credit • Realise full potential of the capital/economic profit • Secure the right procedure quality risk changed business model in framework for credit-granting Life & Pensions • Monitor credit risks and take rapid action 79 • Use credit-scoring models
Group financial targets Key performance indicator 2002 2003 H1/04 Target In the top five of the peer Total shareholder return, % # 15 # 8 # 3 group of 20 banks 1) 2) RoE, excluding goodwill, % 11.3 16.7 23.1 > 15% Costs, EURm 3,673 1,722 Same cost level as in 2003 3,745 Loan losses ratio, % < 0.40% of loans and guarantees 0.05 0.25 0.18 on average over a business cycle Dividend pay-out ratio, % > 40% n.a 48 76 Tier 1 capital ratio, % > 6.5% 7.1 7.3 7.0 Supporting performance indicator Cost/income ratio, % 64 < 55% from 2005 63 61 1) 14.5% using standard tax rate and adjusted for the negative impact of the real estate write-down at year-end 2) 17.3% adjusted for real estate gain in Q2 1
Peer group * by market cap, EURbn 3 August 2004 RBOS BARCLAYS BNP HBOS LLOYDS TSB SOCIETE GENERALE ABN AMRO NORDEA KBC DANSKE BANK ABBEY NATIONAL SHB ALLIED IRISH BANK BANK OF IRELAND HYPOVEREINSBANK COMMERZBANK SEB SWEDBANK DnBNOR SAMPO 0 10 20 30 40 50 60 70 80 *As defined by Nordea 81
Strong distribution network throughout the Nordic and Baltic Sea region Finland Branch offices 416 Personnel 8,683 Sweden Helsinki Branch offices 255 Stockholm Personnel 7,203 St Petersburg Oslo Norway Tallinn Copenhagen Branch offices 130 Riga Personnel 3,488 Moscow Vilnius Denmark Warzaw Branch offices 344 Personnel 8,465 Luxembourg Frankfurt Poland and Baltic Branches/salepoints 57 Personnel 1,450 Countrywide network Total locations 1,202 Branch office or subsidiary Total personnel 29,289 Office of an associated bank 82
Large customer base with high penetration in e-banking Baltic Total Sea DK FI NO SE Region Banking customers (1,000) Personal customers 1,610 2,970 630 4,100 300 9,610 Corporate customers 80 320 60 440 40 940 Life insurance customers (1,000) 617 321 237 517 59 1,751 E-banking customers (1,000) 577 1,246 294 1,605 56 3,778 83
84
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Retail Banking operating profit EURm � Increased lending volumes 500 � SME loan growth continued 450 456 433 400 428 � Strong increase in non-interest 395 350 income 376 300 � Positive net loan losses 250 200 150 100 50 Key ratios Q2/04 Q1/04 0 C/I ratio, % 58 58 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 RoE, % 27 26 86
Retail Banking operating profit by markets Retail DK FI NO SE P&B Q2 Q1 Q2 Q1 Q2 Q1 Q2 Q1 Q2 Q1 Q2 Q1 EURm Net interest income 721 727 205 200 188 187 112 113 196 211 16 12 Non-interest income 374 345 90 88 103 91 35 36 134 120 9 8 Total income 1,095 1,072 295 288 291 278 147 149 330 331 25 20 Total expenses -637 -621 -166 -163 -163 -159 -89 -85 -193 -189 -19 -15 Profit bef. loan loss 458 451 129 125 128 119 58 64 137 142 6 5 Loan losses 1 -16 -5 -9 -3 -2 7 -4 5 1 -2 -1 Operating profit 456 433 128 121 125 117 65 60 138 139 2 2 C/I ratio % 58 58 55 56 56 57 60 57 59 57 76 76 RoE % 27 26 25 25 32 31 23 21 30 30 5 5 Economic capital, 4.9 4.8 1.5 1.4 1.2 1.1 0.8 0.8 1.3 1.4 0.1 0.1 EURbn 87
Retail Banking lending EURbn 40.0 39.5 38.3 38.0 35.0 35.0 33.1 30.0 32.0 28.9 25.0 26.9 25.8 20.0 20.8 20.2 18.9 15.0 10.0 5.0 0.0 Denmark Finland Norway Sweden Q2/03 Q4/03 Q2/04 End of period 88
Retail Banking deposits EURbn 25 22.7 22.6 21.9 20 21.2 20.2 20.1 15 16.1 15.6 15.3 10 11.0 10.4 10.0 5 0 Denmark Finland Norway Sweden Q2/03 Q4/03 Q2/04 End of period 89
Retail Banking deposits EURbn. End of Q2/04 25 9.6 20 4.2 15 2.6 6.7 6.9 6.3 10 1.4 9.2 3.6 6.8 6.6 5 5.5 0 Denmark Finland Norway Sweden Corporate Household customer - saving accounts 90 Household customer - current accounts
Retail Banking, volumes and margins Volumes Margins Q2/04 Q1/04 Q2/04 Q1/04 EURbn Lending to corporates 58.1 56.8 1.2% 1.2% Lending to household customers 67.5 64.3 1.5% 1.6% Household mortgages 52.6 50.0 0.9% 1.0% Total lending 125.6 121.1 1.4% 1.4% Deposits from corporates 28.8 28.6 0.9% 1.0% Deposits from household customers 41.8 40.9 1.4% 1.6% Total deposits 70.6 69.6 1.2% 1.3% Margins are quarterly averages and exclude Poland and Baltic, volumes end of period 91
Retail Banking, lending and deposit margins % Quarterly averages 2.6 � Overall stable lending 2.4 margins 2.2 – household margins slightly 2.0 1.8 down 1.6 – SME margins stable 1.4 1.2 � Declining deposit margins 1.0 0.8 0.6 0.4 0.2 0.0 Q1/02 Q2/02 Q3/02 Q4/02 Q1/03 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 Lending to corporates Lending to households Morgage lending to households Deposits from corporates Deposits from households 92
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Jan-00 94 E-banking customers 1.5 2.5 3.5 June-00 Mill. 1 2 3 4 Nov-00 April-01 E-banking customers Sept-01 Feb-02 July-02 Dec-02 May-03 Oct-03 Mar-04 Jan-00 (1,000) 100 150 200 250 300 350 400 June-00 50 0 Nov-00 April-01 Equity trading customers Sept-01 Feb-02 July-02 Dec-02 May-03 Oct-03 Mar-04
Payments and log-ons E-banking payments E-banking log-ons Mill. Mill. 50 50 45 45 40 40 35 35 30 30 25 25 20 20 15 15 10 10 5 5 0 0 Q1/00 Q3/00 Q1/01 Q3/01 Q1/02 Q3/02 Q1/03 Q3/03 Q1/04 Q1/00 Q3/00 Q1/01 Q3/01 Q1/02 Q3/02 Q1/03 Q3/03 Q1/04 Denmark Finland Norway Sweden Denmark Finland Norway Sweden 95
Jan-01 96 10 15 20 25 30 35 % Penetration on the net 0 5 May-01 Sept-01 Mutual funds penetration rate Jan-02 May-02 Sep-02 Jan-03 May-03 Sep-03 Jan-04 May-04 Jan-00 10 20 30 40 50 60 70 80 % May-00 0 Sept-00 Jan-01 Equity trading penetration rate May-01 Sept-01 Executed trades Jan-02 May-02 02-Sep Jan-03 May-03 Sep-03 Jan-04 May-04
97 J a 10 20 30 40 50 60 Mill. n - 0 Cards 0 1 M a y - 0 1 S e p t - 0 1 J a n - 0 2 Card payments M a y - 0 2 S e p t - 0 2 J a n - 0 3 M a y - 0 3 S e p - 0 3 J a n - 0 4 M a y - 0 4 J Mill. 0.0 0.5 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 5.0 a n - 0 1 M a y - 0 1 S e p Issued debit and credit cards t - 0 1 J a n - 0 2 M a y - 0 2 S e p t - 0 2 J a n - 0 3 M a y - 0 3 S e p - 0 3 J a n - 0 4 M a y - 0 4
Payment transactions, households Payments transactions, households Breakdown of transactions Mill. Mill. 300 140 120 275 100 250 80 225 60 200 40 175 20 150 0 Q1/01 Q2/01 Q3/01 Q4/01 Q1/02 Q2/02 Q3/02 Q4/02 Q1/03 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 Q1/01 Q3/01 Q1/02 Q3/02 Q1/03 Q3/03 Q1/04 Manual transactions Payment ATMs Card payments Cash withdrawal ATMs Direct debit Solo payments 98
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CIB operating profit EURm 180 � Increased lending volumes � Markets income down 150 154 – lower customer activity 131 120 – challenging market conditions 100 90 � Stable development in other areas 92 85 � Positive net loan losses 60 30 Key ratios Q2/04 Q1/04 0 C/I ratio, % 64 48 Q2/03 Q3/03 Q4/03 Q1/04 Q2/04 RoE, % 14 25 100
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