FöreningsSparbanken Lars-Erik Kvist Group EVP and Chief Credit Officer
2 Lending and credit quality
3 Lending • A sound profitability • Annual growth rate in total lending 3.8 percent (9M-2002 growth annualized) – Continued strong position in the household sector – Increased market share in the agricultural sector (Jordbrukskredit) – FSPA Finans (finance services lending) has a strong growth and is growing its market share
4 Group lending 12/00– 09/02 Net excl. repurchase agreements SEK M 700 000 650 000 600 000 550 000 500 000 450 000 400 000 350 000 300 000 12/00 3/01 6/01 9/01 12/01 03/02 06/02 09/02 FI-Holding and Hansabank
5 Lending Sep. 30, Jun. 30, Mar. 31, Dec. 31, SEK bn 2002 2002 2002 2001 Private individuals 296 291 285 281 of which Spintab Group 242 237 232 228 Real estate management 137 136 135 136 Retail, hotels, restaurants 26 25 25 25 Construction 10 10 10 11 Manufacturing 51 50 51 51 Transportation 14 14 14 14 Forestry and agriculture 30 29 29 28 Other service businesses 14 15 16 17 Other business lending incl credit institutions 54 55 55 54 Municipalities 13 14 13 13 Other 13 10 10 10 Total 658 649 643 640 Repurchase agreements 46 51 54 44 Total lending 704 700 697 684
6 Group lending excluding repurchase agreements FSPA excl. Hansabank and FI-Holding Hansabank FI-Holding 2002 2001 2002 2001 2002 2001 SEK bn 9/30 12/31 9/30 12/31 9/30 12/31 Private individuals 289.0 275.0 7.3 6.2 0.0 0.0 of which Spintab Group 242.1 228.2 Real estate management 117.2 116.9 2.7 2.1 17.0 16.5 Retail, hotels, restaurants 16.1 16.1 4.5 3.9 5.1 4.9 Construction 8.4 8.9 0.8 0.7 1.3 1.4 Manufacturing 13.6 14.3 5.3 4.3 31.8 32.8 Transportation 6.4 6.3 3.1 2.5 4.9 5.4 Forestry and agriculture 29.6 27.4 0.8 0.7 0.0 0.0 Other service businesses 12.1 13.4 1.6 1.6 0.3 1.7 Other business lending incl. credit institutions 41.6 42.6 1.6 1.9 11.0 9.9 Municipalities 12.8 13.0 0.0 0.0 0.0 0.0 Other 12.5 9.7 0.0 0.0 0.0 0.0 Total 559.3 543.6 27.7 23.9 71.4 72.6
7 Group lending excluding repurchase agreements SEK bn Sep. 30, 2002 Dec. 31, 2001 Change FöreningsSparbanken AB 182 186 – 2 % Spintab 359 341 5 % FöreningsSparbanken Finans AB 15 13 12 % FI-Holding 71 * 73 – 2 % Hansabank 28 ** 24 16 % Other units 3 3 Total 658 640 3 % * From which exchange rate fluctuation SEK – 2 bn ** From which exchange rate fluctuation SEK – 1 bn
8 Lending by collateral September 30, 2002 Personal guarantee, 2% Floating charges, 3% Unsecured, 12% Other properties , 16% Other collateral, 6% Municipalities and county councils, 7% Residential properties incl. condominiums, 54% Lending SEK 658 billion
9 Lending by sector September 30, 2002 Other 2% Corporates 30% Private individuals 45% Municipalities 2% Real estate management 21% Lending SEK 658 billion
10 Doubtful claims SEK M 14 000 12 000 10 000 8 000 6 000 4 000 2 000 0 -2 000 dec-97 dec-98 dec-99 dec-00 01-dec 02-mar 02-jun 02-sep Doubtful claims gross Doubtful claims net
11 Doubtful claims gross by Group unit SEK M Sep. 30, 2002 Dec. 31, 2001 Sep. 30, 2001 FöreningsSparbanken AB 2,273 2,164 1,862 Spintab 574 626 644 FöreningsSparbanken Finans 148 167 134 FI-Holding 533 316 370 Hansabank 306 735 698 Others 143 245 274 Total 3,977 4,253 3,982
12 Doubtful claims net by Group unit SEK M Sep. 30, 2002 Dec. 31, 2001 Sep. 30, 2001 FöreningsSparbanken AB – 535 56 84 Spintab 86 142 153 FöreningsSparbanken Finans 90 117 78 FI-Holding – 649 – 826 – 815 Hansabank – 120 217 169 Others 99 167 208 Total – 1,029 – 127 – 123
13 Loan losses SEK M Jan-Sep 2002 Jan-Sep 2001 Established 531 503 Provisions 1,452 1,124 Recoveries – 740 – 764 Change in value of property taken over 0 15 Total 1,243 878 of which general provisions 786 380 Provision ratio for doubtful claims 126% 103%
14 Loan losses by Group unit SEK M Jan-Sep 2002 Jan-Sep 2001 FöreningsSparbanken AB 1,183 685 Spintab 112 178 FI-Holding 84 74 Hansabank – 12 3 Others – 124 – 62 Total 1,243 878 of which general provisions 786 380 - in FöreningsSparbanken AB 710 397
15 Loan losses, private individuals SEK M 600 500 400 300 200 100 0 97-12 98-12 99-12 00-12 01-12 02-03 02-06 02-09 -100 Loan losses net, SEK M
16 Doubtful claims, private individuals SEK M 1 800 1 600 1 400 1 200 1 000 800 600 400 200 0 97-12 98-12 99-12 00-12 01-12 02-03 02-06 02-09 Doubtful claims gross Doubtful claims net
17 Credit exposure book value SEK M Country Sep. 30, 2002 Dec. 31, 2001 Change Sweden 620,220 608,031 12,189 Denmark 77,710 80,786 – 3,076 USA 16,486 29,611 – 13,125 Rest of OECD 60,385 53,087 7,298 Latin America 1,242 1,618 – 376 of which Argentina 41 119 – 78 of which Brazil 628 774 – 146 Baltic region 36,485 32,104 4,381 Russia 228 86 142 Japan 262 676 – 414 Rest of East Asia 1,111 997 114 Other countries 3,506 3,311 195 Total 817,635 810,307 7,328
18 Improved efficiency Blanco Spintab Rörelsekredit Spintab multifamily housing 0 50 100 150 minutes 2001 1999/2000 Despite added customers and increased lending volumes, resource consumption within Retail Sweden for lending activities has decreased from 27 to 25 percent
19 Credit risk control Cental credit unit risk control Local credit risk control • Review all new loans • Monthly/quarterly follow-up of the Group´s loan portfolio in accordance with esta- • Monitor quality of local credit blished report structure portfolios - industry and collateral distribution - decision quality - loan losses and doubtful claims - risk classification - 20 largest problem loans/unit - register quality - assets taken over to protect claims - incomplete files - all risk exposures SEK 1 M with - handling of problems estimated risk of loss within 24 months - risk-classified loan portfolio • Report to local president and board - risk development • Supervision by local credit organization - deviations from instructions - credit organization - education/competence - need for support - routines for customer follow-ups • Support local officers • Develop routines and instructions
20 Credit limit structure Board of directors Unlimited Central headquarters Board credit- and capital committee Unlimited Central credit committee SEK 150/350 M Local bank Local board SEK 10/20/30/40 M Depending on size Local delegation SEK 7.5/15/20/30 M Two officers jointly SEK 0.25/3/5 M
21 Outlook 2003 • Spintab - continued growth • Jordbrukskredit - continued growth • Finansbolaget - continued growth • Improved credit scoring – 40-50 percent of housing loan applications are handled manually. With the new scorecard up-and-running the figure will come down to 10 percent.
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