Debt Investor Presentation - Sampo Group · 08/02/2017 Financial Statement Release for 2016. ......

Debt Investor Presentation

PREPARED AUGUST 15, 2017FIGURES JUNE 30, 2017

DEBT INVESTOR CONTACTS

Markku Pehkonen, CROtel. +358 10 516 [email protected]

Peter Johansson, CFOtel. +358 10 516 [email protected]

Jarmo Salonen, Head of Investor Relations and Group Communicationstel. +358 10 516 [email protected]

FINANCIAL CALENDAR 2017

08/02/2017 Financial Statement Release for 2016Silent period 09/01/2017-08/02/2017

Week 12 Annual Report 201627/04/2017 AGM11/05/2017 Interim Statement Q1/2017

Silent period 11/04/2017-11/05/201709/08/2017 Half-Year Financial Report 2017

Silent period 10/07/2017-09/08/201702/11/2017 Interim Statement Q3/2017

Silent period 03/10/2017-02/11/2017

Issuer Rating Moody's Standard and Poor's

Rating Outlook Rating Outlook

Sampo plc Baa1 Stable A- Stable

If P&C Insurance (Sweden) A1 Stable A+ Stable

If P&C Insurance Co. (Finland) A1 Stable A+ Stable

DisclaimerThis 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

8/17/2017

3

17 August 2017

Sampo Group Nordic Financial Group with Strong Brands 3-17

If P&C Diversified Nordic P&C Insurer 18-23Mandatum Life A Finnish Financial Services Company 24-28Sampo plc Parent Company with Capacity to Generate Funds 29-35Appendix Separate Supplementary Information 36-47

4

Sampo Group ― Nordic Financial Group with Strong Brands

8/17/2017

21.2%

Simplification• Cost & capital efficiency• One operating model• Compliance• Digital Offering

The most diversified bankin the Nordics with strong capital generation

~ B/S EUR 643bn~ AuM EUR 332bn

• ROE above the Nordic peer average

The second largest P&C insurer in Denmark

Customer satisfaction• Pricing• Efficiency• Distribution power

~ EUR 2.7bn (P&C)

• Profit margin of 10%• CR% 91%

> 45% 100% 100%

One of Finland’s most respected and best capitalised financial services providers to private & corporate customers

• Unit-linked products• Wealth management• Personal Risk insurance • Group pension & Reward

Services

~ EUR 6.5bn

• RoE above 17.5%

The leading P&C insurer in the Nordic region with full service offering and a strong European presence

Focus areas:• Customer value• Focused insurance

expertise• Nordic business platform• Investment strategy with

balanced risk

~ EUR 12.3bn

• RoE above 17.5%• CR% below 95%

MARKETPOSITION

STRATEGY

INVESTMENTASSETS

RETURN /PROFIT

TARGET

Associated CompanySubsidiary SubsidiaryAssociated Company

• Long-term investor• Manager of capital structure and liquidity• Pay-out ratio ≥ 50%

Sampo Group structure

44.131.5

26.525.325.2

23.823.3

18.37.2

5.85.35.0

3.12.8

1.40.70.4

0 10 20 30 40 50

NordeaDanske

DnBSwedbank

SampoSHBSEB

InvestorGjensidige

IndustrivärdenTryg

JyskeStorebrand

TopdanmarkAlm.Brand

ProtectorAktia

Efficient and Stable Operations as Basis for Value

Source: Thomson Reuters

>45%

Sampo ownership structure

*100% owned by the Republic of Finland; 30.6.2017

Market cap August 14, 2017, EURbn

Strong relative performance 10Y Total Shareholder Return

A Mixed Financial Conglomerate

BankInsuranceInvestment company

Foreign and Nominee registered 61.96%

Solidium 11.90%*

Varma Mutual Pension Ins.Co. 5.35%

Björn Wahlroos 1.79%

The State Pension Fund 0.70

Ilmarinen Mutual Pension Ins.Co. 0.65%

Other domestic owners 17.66% 5

>21%

8/17/2017


In total over100,000 owners

1-6/2017 Result • Pre-tax profit EURm 453 (436)• Comprehensive income EURm 448 (245)• Excellent combined ratio of 86.5% (83.7)

– Risk ratio 64.5% (61.6); Cost ratio 22.0% (22.2)– Expense ratio 16.4% (16.8)

• ROE,% 30.5% (2016: 25.3%)

If P&C ‒ Diversified Nordic P&C Insurer

6

• Diversified and profitable subsidiary• Provides insurance solutions and

services in the Nordic and Balticregions as well as to Nordic customers with international operations.

• As an only company business activities are operated on a pan-Nordic basis.

• The business is divided into customer segments Private, Commercial and Industrial.

• The Baltic countries comprisea separate business area.

• More than 3.7 million customers• Employees ~6,100• Leading Nordic insurer with a Nordic

market share of 17%, 22% withTopdanmark

8/17/2017

549

644

707

636

864

929

931

960

883

-267

1,12

7

943

308

978

689

526

624

714

-400-200

0200400600800

1,0001,200

2008 2009 2010 2011 2012 2013 2014 2015 2016

Profit before tax Comprehensive income

Strong & Stable Annual Profit DevelopmentEURm

68.1

68.0

69.1

68.4

65.9

65.4

65.1

66.6

62.3

64.5

23.7

24.1

23.7

23.5

23.0

22.8

22.5

18.8

22.1

22.0

91.8

92.1

92.8

92.0

88.9

88.1

87.7

85.4

84.4

86.5

020406080

100%

Risk ratio Cost ratio Target CR

Combined Ratio Development


Topdanmark – Danish Non-life and Life Insurer

7

1-6/2017 Result• Topdanmark’s contribution to Group Pre-tax profit EURm 52 (19)• Combined ratio 81.8% (86.2)

– Claims ratio 65.1% (69.3); Expense ratio 16.7% (16.9)• Topdanmark book value in Group accounts EURm 626 (+ positive valuation difference EURm 548)

• A profitable associated company withrobust business model

• Carries out Danish non-life insurance, life insurance and pension fund business

• Non-life business is divided to ‒ Personal segment (~500,000)‒ SME & Agricultural segment (~100.000)

• Life insurance (~130 000)• Employees ~2,600• Market shares in Denmark:

‒ P&C insurance 17%, life insurance 8% (100)

0 100 200 300 400 500 600 700 800

Non-life insurance Life insuranceParent company etc.

2012 2013 2014 2015 2016

Pre-tax Profit Quarterly, DKKm

DKKm

Combined Ratio,%

72.2 75.4 70.3 70.9 68.7

15.8 16.2 15.7 15.9 16.4

0

20

40

60

80

100

2012 2013 2014 2015 2016

%

Claims ratio Expense ratio Target CR

85.186.886.091.588.0


8/17/2017

• Strategic focus‒ to achieve primarily organic growth, supplemented by close

co-operation with alliance partners, and opportune acquisitions‒ to develop and improve customer service‒ to optimise shareholders' return / risk profile ‒ to be a dynamic organisation‒ to align the goals of Management, employees and shareholders

• Sampo’s ownership of shares 46.7% and of votes 49.3%

Mandatum Life ‒ A Finnish Financial Service Company

1-6/2017 Result• Pre-tax profit EURm 116 (103) • Comprehensive income EURm 111 (44)• ROE,% 15.6% (2016: 15.9%)

8

• Provides a comprehensive range of services in Finland and Balticsfor private and corporate customers.

• Services provided‒ Wealth management‒ Savings‒ Personal risk insurance‒ Pension and incentive &

reward services.• Customers ~275,000 (Finland)• Employees ~540• A leading life and pension insurer in

Finland with ca 20% market share

8/17/2017

140

121

142

137

136

153

163

181

210

-378

495

332

-115

286

220

149

168

232

-500

-250

0

250

500

2008 2009 2010 2011 2012 2013 2014 2015 2016

EURm

Profit before taxesComprehensive income

Profit Development

• Finnish Profit sharing mechanism – principle of fairness ‒ facilitates active investment strategies and risk taking.

• Profit sharing mechanism has benefited both policyholdersand shareholders over the years.

• Smoothened bonuses and dividends over time. 0

2,000

4,000

6,000

12/2

016

12/2

017

12/2

018

12/2

019

12/2

020

12/2

021

12/2

022

12/2

023

12/2

024

12/2

025

12/2

026

12/2

027

12/2

028

12/2

029

12/2

030

12/2

031

Other WP-liabilitiesSegregated Group PensionWP-liabilities (3.5% guarantee)WP-liabilities (4.5% guarantee)

With-Profit Technical Provisions Forecast *EURm


Current

* Unit-linked Technical Provisions 30.6.2017 EUR 6,732m

Nordea – A Nordic Banking Group

9

• The Leading Bank in the Nordics anda major European Bank company

• Diversified and stable returns• Offers a full range of banking services• Business areas: Personal Banking,

Commercial Banking & BusinessBanking, Wholesale Banking and Wealth Management

• Operates in 8 home markets: The Nordic region, the Baltics and Russia

• Customers:‒ households 10 million‒ corporates and institutionals 0.5 million

• Employees ~32,000• Sampo’s ownership of shares and votes 21.2%

1-6/2017 Result• Nordea’s contribution to Group

‒ Pre-tax profit EURm 322 (364)‒ Comprehensive income EURm 281 (332)

• Excellent C/I ratio of 52% (49)• Common Tier1 ratio 19.2% (16.8)• ROE,% 9.9% (10.7)• Nordea book value in Group accounts EURm 7,303

(+positive valuation difference EURm 2,267)

-2000

200400600800

1,0001,2001,4001,600EURm

Restructuring/impairment charges/gainsLoan lossesOperating profit

-08 -09 -10 -11 -12 -13 -14 -15 -16

18 23 36 54 73

127

Nordea Peer 1 Peer 2 Peer 3 Peer 4 Peer 5

Nordea and Peers 2006-2016Quarterly Net Profit Volatility,%

Low Quarterly Result Volatility


-17

8/17/2017

• 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

Diversified Companies & Diversified Portfolio*

• Geographical diversification• Strong Retail Banking Franchise• Diversified earnings base:

‒ Banking (Retail, Wholesale)‒ Wealth Management (Asset

Management, Private Banking, Life & Pensions)

• Low earnings volatility & stableROE over the cycle

• Finland & Baltics• Strong Finnish Position• Product areas

‒ Wealth Management‒ Unit-linked Business‒ With-profit Business ‒ Remuneration services‒ Risk insurance

• Dependency on Capital Markets

* Correlations of quarterly Reported Profits Q1/2005–Q2/2017

PBT 2010-16

IF 45%ML 10%Nordea 45%

P/L CONTRIBUTIONS

10

LOW VOLATILITY EARNINGS LOW VOLATILITY C/R FOCUS ON U-L & WM

0.30

0.14

1

0.84 1

1

8/17/2017


948

1,295 1,353

870 825

1,320 1,228

1,616 1,668 1,7591,888 1,871

-2000

200400600800

1,0001,2001,4001,6001,8002,0002,200

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016P&C Life Banking Holding

Steady Development of Profit before Taxes

* One-off item – sale of Sampo Bank

EURm

*

• If P&C• Mandatum Life• Sampo Bank

• If P&C• Mandatum

Life• Nordea /

Investment

• If P&C• Topdanmark / Associated• Mandatum Life • Nordea / Associated

3,833

11

8/17/2017


EURm 6M/17 6M/16P&C 453 436Life 116 103 Nordea 322 364 Holding -27 -11Group 865 893

Risk Profiles of Investments

12

8/17/2017

* non-consolidated


Total Group (MEUR) 19,652 20,708 20,813 20,111

09/16 12/16 03/17 06/17

Money Market 11% 10% 43% 8% 13% 75% 5% 6% 73% 6% 11% 35%Long-Term Fixed Income 76% 49% 45% 79% 47% 20% 82% 53% 21% 81% 51% 55%Equity 12% 27% 9% 13% 26% 5% 13% 27% 4% 13% 25% 5%Private Equity 0% 4% 0% 0% 4% 0% 0% 4% 0% 0% 3% 0%Other 0% 10% 2% 0% 10% 1% 0% 10% 1% 0% 9% 5%

12,305

6,569

778

12,192

6,582

1,933

12,337

6,547

1,929

12,319

6,507

1,285

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

IfP

&C

Man

datu

mLi

fe

Sam

poPl

c IfP

&C

Man

datu

mLi

fe

Sam

poPl

c IfP

&C

Man

datu

mLi

fe

Sam

poPl

c IfP

&C

Man

datu

mLi

fe

Sam

poPl

c

*

Investments & Counterparty Exposures*

* In Exposure tables the calculation rules may differ slightly from Allocation tables in some areas.13

8/17/2017


30.6.2017AAA AA+ -

AA-A+ - A-

BBB+ - BBB-

BB+ - C

D NonRated

Fixed Income Total

Equities Other Derivatives (Counterparty Risk)

Total Change from 31.3.2017

Basic Industry - - 45 45 59 - 104 252 83 - - 336 - 53

Capital Goods - 31 101 55 - - 115 303 702 - - 1,005 + 19

Consumer Products - 152 304 393 60 - 65 974 591 - - 1,565 + 9

Energy - 74 48 - 63 - 207 392 14 0 - 406 - 94

Financial Institutions - 2,011 2,747 1,069 55 - 45 5,927 86 1 13 6,027 - 688

Governments 96 - - - - - - 96 - - - 96 - 22

Government Guaranteed 76 78 - - - - - 153 - - - 153 - 26

Health Care 7 41 61 49 42 - 59 258 117 - - 375 + 26

Insurance - - 42 111 17 - 97 267 3 37 - 307 + 13

Media - - 17 - - - 38 55 - - - 55 - 12

Packaging - - - - 41 - 12 52 1 - - 53 - 16

Public Sector, other 742 234 42 - - - - 1,019 - - - 1,019 - 17

Real Estate - 6 96 101 - - 509 713 - 210 - 923 - 2

Services - - - 101 72 - 152 324 116 0 - 440 - 18

Technology and Electronics 24 - 84 18 18 - 36 180 123 - - 304 - 85

Telecommunications - - 5 167 9 0 67 248 99 0 - 347 + 9

Transportation - 60 11 56 22 - 202 352 37 - - 389 - 59

Utilities - 2 33 374 72 - 61 541 - - - 541 - 68

Others - 26 - - 12 - 14 52 0 45 - 98 + 8

Asset-backed Securities - - - - - - - - - - - - + 0

Covered Bonds 3,240 99 - 10 - - - 3,349 - - - 3,349 + 182

Funds - - - - - - 136 136 1,286 567 - 1,990 - 14

Clearing House - - - - - - - - - - 23 23 + 19

Total 4,185 2,815 3,636 2,549 541 0 1,918 15,644 3,258 861 36 19,799 - 890

Change from 31.3.2017 + 126 - 655 - 226 + 143 - 191 - 0 + 93 - 709 - 94 - 116 + 29 - 890 EURm

Mandatum Life – Solvency II Capital Requirement (SCR)With transitional measures, June 30, 2017

LAC = Loss Absorbing Capacity, TP = Technical Provision, DT = Deferred Taxes

*

* Own Funds without transitional measures EUR 1,663m

EURm

14

SF with transitional measures Solvency ratio 205%

1,211

57392 279

37 70269

1,077

269

2,210

0

500

1,000

1,500

2,000

2,500


EURm

714

1,48

2

305

867

176 218

1,59

2

4,46

9

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

1,38

7

1,12

2

110

503

176 3231,

968

4,43

7

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

Internally assessed Solvency ratio 281%Standard Formula Solvency Ratio 225%

LAC = Loss Absorbing Capacity, DT = Deferred Taxes, SCR= Solvency Capital Requirement

EURm

15

S&P TTC for A rating 2,977 EURm S&P TTC for A rating 2,977 EURm

If P&C Solvency Capital Requirement June 30, 2017


1,968

1,077239

3,55036

6,870

11,179

0

2,000

4,000

6,000

8,000

10,000

12,000

If P&C (SF*) MandatumLife (SCR**)

TopdanmarkSampo plc'sshare ofNordea

Sampo plc Total capitalrequirement

GroupSolvencyCapital

Group Solvency Capital by Financial Conglomerate Rules June 30, 2017

EURm

Group solvency ratio 163% / SII Standard Formula applied for Insurance Subsidiaries

16

*) Standard formula, **) SCR with transition rules


Value Creation in the Nordic Financialsas Group StrategyLONG-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.

OPERATIONAL EXCELLENCE IN SUBSIDIARIES

• Continuous development of services => excellence in underwriting and risks.• Economies of scale and high retail/consumer content.• Pan-Nordic diversification & operational excellence facilitate low volatility.

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.

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

CENTRALIZEDINVESTMENT MANAGEMENT

• Company specific liabilities and solvency driving risk profiles, supported bya Group-wide investment philosophy. Common investment infrastructure facilitates effective monitoring and fast actions, also at the Group level.

17

8/17/2017


18

17 August 2017



By Business Area By Country

Private72%

Commercial13%

Industrial11%

Baltic2%

Other2%

Technical Results, EUR 294m H1/2017

Norway55%

Sweden33%

Finland4%

Denmark4%

Baltic2%

Other2%

Gross Written Premiums, EUR 2,706m H1/2017

By Business Area By Country

Private51%

Commercial 31%

Industrial, 15%

Baltic3%

Norway30%

Sweden33%

Finland , 25%

Denmark9%

Baltic 3%

If P&C – Diversified Nordic P&C Insurer

Diversified Client Base

19

8/17/2017

Expense ratio 2016, %

Combined Ratio ‒ If P&C and Nordic Peers

If P&C and BA Combined Ratios and deviation

Standard deviation 2008-2016

3.1%

4.3%

4.9%

3.7%

3.5%

92.1

92.8 92

88.9

88.1

87.7

85.4

84.4

93 96.1

95.2

90.7

90.6

88.3

88.2

87.2

7580859095

100

2009 2010 2011 2012 2013 2014 2015 2016If P&C Nordic Market (incl.If)

Disciplined Underwriting and Diversification work

20

%

8/17/2017

16.416.616.518.2

25.326.927.428.7

31.831.9

TopdanmarkIf P&C

Nordic peer group -15RSA Scandinavia

Direct LineAXA

GeneraliAllianz

ZFSAviva


Private Commercial

Industrial

Baltic

If P&C

Norway

Sweden

Finland

Denmark

0

2

4

6

8

10

12

14

86 88 90 92 94 96 98

CR

% S

tand

ard

devi

atio

n Q

1/20

07-Q

2/20

17

Average CR% Q1/2007-Q2/2017

http://www.topdanmark.dk/

http://www.topdanmark.dk/

Conservative Investment Portfolio

• Duration 1.5 years• Average Maturity 2.9 years• Fixed Income Running Yield 1.6%

Mark-to-Market Investment Return, %Investment Allocation

4.3%5.8%

4.4%2.6%

-3.1%

12.4%

7.4%

1.8%

6.1%5.0%

4.1%1.5%

2.9%

-4%-2%1%4%6%9%

11%14%

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

Mark-to-Market Investment Return, EURm

821

113

689558

459

190334

0200400600800

1,000

2010 2011 2012 2013 2014 2015 2016 21

Total EUR 12.3bn

8/17/2017

1-6/2017 EUR 289m

1-6/2017 2.4%


Money market

6%Public sector10%

Other fixed income

71%

Equities13%

Private equity

0%

Real Estate0%

Other0%

0

50

100

150

200

250

300

350Technical result Investment result Operating result

Seasonality in Quarterly Results and CR%

Q4 Q3 Q2 Q1Average Quarterly CR%, 2006-2016 89.5 88.3 87.9 92.2Year 2016 CR% 85.6 84.6 84.5 83.0*Year 2017 CR% 85.7 87.4

EURm

22

* incl. positive one-off8/17/2017


Nordic P&C Insurance Market

23

21

18

6

12

17

Finland

Norway

Sweden

Denmark/ If P&C +Topdanmark

Baltics

If17%

Topdanmark5%

Tryg9%

LF10%

Codan9%Gjensidige

9%

Folksam5%

OP5%

LähiTapiola4%

Other27%

If + Topdanmark 22%

Total premiums EUR 26 bn

23

• Consolidated markets• Loyal clients• Direct sales dominates the market• Various other distribution channels• Low expense ratios• Good profitability


Latest available data

Nordic Market Shares, % If P&C Market Shares by Country, %

8/17/2017

24

17 August 2017



Premiums Written, EUR 426m, H1 2017 Insurance Savings, EUR 10,561m, H1 2017

131

60174

942 8

1

Unit-linked life Unit-linked pension Unit-linked capital redemptionUnit-linked Baltic Other life Other pensionOther capital redemption Other Baltic

2,436

2,086

2,046162

170

3,617

27 17

Mandatum Life Business Volumes

U-LEUR 6,730m

With-ProfitEUR 3,831U-L

EUR 374m

With-ProfitEUR 52m

4,652 4,626 4,738 4,695 4,621 4,487 4,431 4,410 4,249 4,071 3,927 5,065 5,014 4,821 4,761

607 884 1,262 1,752 2,071 1,637 2,359 3,124 3,054 3,833 4,6165,312 5,858 6,440 6,732

02,0004,0006,0008,000

10,00012,000

Guaranteed interest rates Unit-linked

Technical Provisions, EUR 11,493m

EU

Rm

Mandatum Life - A Finnish Financial Services Company

25

8/17/2017

Note: Excluding reserves for decreased discount rate, future bonus reserves and longevity reserve

Investment Portfolio covering With-Profit liabilitiesMark-to-Market Investment Return, %Investment Allocation

8.3%

12.0%9.7%

5.0%

-7.8%

16.8%

11.1%

-1.4%

9.4%7.1%

4.6%

6.9%6.70%

-10%

-5%

0%

5%

10%

15%

20%

615

-59

504391

251

427 440

-1000

100200300400500600700

2010 2011 2012 2013 2014 2015 2016

26

• Duration 2.3 years• Average Maturity 2.7 years• Fixed Income Running Yield 2.6%

Mark-to-Market Investment Return, EURm

8/17/2017


1-6/2017 EUR 264m

1-6/2017 3.9%Asset Allocation 30.6.2017, 6 507 EURm

Money Market Securities and

Cash11 %

Government Bonds

1 %

Credit Bonds, Funds and

Loans50%

Listed Equity25 %

Real Estate3%

Private Equity4 %

Unlisted Equity0 %

Biometric0,4%

Commodities0 %

Other Alternative

5 %

Trading Derivatives

0 %

Mandatum Life Profit by Components

Total expense ratio, % 99.9 103.3Incl. kick backs, % 79.5 84.0

EURm 1-6/2017 1-6/2016Net investment income 518.8 81.9

- Transferred to expense result -13.5 -12.0- Return on Unit-linked policies -262.2 74.7- Return on With-profit policies* -146.2 -59.4

INVESTMENT RESULT 96.9 85.2EXPENSE RESULT** 13.1 9.3RISK RESULT 15.1 10.5OTHERS -8.7 -1.5PROFIT BEFORE TAXES 116.3 103.4Change in the market value of investments 22.3 -49.4PROFIT AT MARKET VALUES 138.6 54.1

Mandatum Life Group, expense ratio

* Includes guaranteed interest, bonuses and change in the reserves of the above items** Result of Unit-linked business EURm 16.3

27

8/17/2017


Life insurance Market

OP Life22%

Mandatum Life24%

Nordea31%

LähiTapiola9%

Fennia5%

Sp-Henkivakuutus

3%

Aktia 2%

Other4%

Total premiums EUR 4.5 bn

28

• Various distribution channels• Bankassurance• Unit-linked products• Markets sensitive for regulation, tax changes,

interest rate movements


7

8

Baltics/Mandatum Life

Danmark/Topdanmark

Latest available data

Finland ‒ Market Shares, % Market Shares by Country, %

8/17/2017

29

17 August 2017



Simple Cash Flows, low leverage and adequate liquidity

Dividends • If P&C• Mandatum Life• Nordea• Topdanmark

• Internal Administration Costs• Discretionary Dividends for Shareholders• Interest Expenses for Bondholders

Income• Interest on Liquidity • Income from other

investments

Sampo plc

Assets 10,291 Liabilities 10,291

Liquidity 449 CPs Issued 394

Investment assets 192 LT Senior Debt 2,884

- Real Estate 2 - Private Placements 128

- Fixed Income 60 - Bonds Issued 2,757

- Equity & Private Equity

130 - Pension Insurance Loans

Subordinated Loans 628 Subordinated Debt 0

Equity Holdings 8,958 Capital 6,936

- Subsidiaries 2,370 - Undistributable 98

- Associated 6,588 - Distributable 6,838

Other Assets 64 Other Liabilities 76

Flow of Funds Balance Sheet, EURm

Key Credit Metrics well in Single A range

Sampo plc 30.6.2017Gross Debt, EURm 3,279Gross Debt to Equity 47%Financial Leverage 32.1% (= Debt/(Debt+Equity)

Sampo Group, EURm Q2/2017 Q2/2016 Shareholders' Equity 11,500 10,830 Hybrid Bonds 218 12 Senior Debt 3,279 2,329Financial leverage 28.0% 21.5%

30

Sampo plc - Parent Company with Capacity to Generate Funds

8/17/2017

Cash and tradable financial investments 30.6.2017

31

Instrument & Principal Running Yield Call/ Maturity

Cash / Other FI 449m€

Investment Assets 192m€

Subordinated loans (MV) 628m€ ≈ 5.30%

- Mandatum Capital Loan 100m€ 4.42% Every year

- IF PerpNC5.5 90m€ 4.71% 26.11.2018- IF 30NC10 99m€ 6.07% 08.12.2021- Nordea AT1 PerpNC5 171m$ 5.95% 23.9.2019- Nordea AT1 PerpNC5 98m$ 6.48% 13.9.2021- Topdanmark Tier1 33m€ 5.88% 15.9.2017- Topdanmark 10NC5 135mDKK 2.92% 11.12.2020- Topdanmark 10NC5.5 270mDKK 2.48% 11.6.2021

TOTAL * 1,269m€

• In case subordinated loans are sold, both liquidity and Own Funds at Group level are generated• This buffer of liquidity and Own Funds comes with positive interest margin

* Before dividend payments8/17/2017


Sampo Group ― Conservative Leverage

-4,000-2,000

02,0004,0006,0008,000

10,00012,00014,00016,000

Q1/

05Q

1/06

Q1/

07Q

1/08

Q1/

09Q

1/10

Q1/

11Q

1/12

Q1/

13Q

1/14

Q1/

15Q

1/16

Q1/

17

Sampo plc Net debtGroup NAVGroup Equity

EURm

0%

5%

10%

15%

20%

25%

30%

35%

40%

Q1/

05Q

1/06

Q1/

07Q

1/08

Q1/

09Q

1/10

Q1/

11Q

1/12

Q1/

13Q

1/14

Q1/

15Q

1/16

Q1/

17

Net debt/NAV

32

• ”Loan-To-Values” based on above figures is low• Parent Companyʼs Financial Leverage is 32%

=> Sampoʼs position to refinance its debt is strong

8/17/2017


Dividends Received by Payment Year

EURm

249

1,031

519

181

488 540406

544 490597 587 586

293

100

300

200

200

100100

100 100

125

125

141

75

35

13080

204 250 224293

370533

551

559

490

1,406

754

511 568

744 756 768883

1,067

1,220

1,555

684

0

200

400

600

800

1,000

1,200

1,400

1,600

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017**

If P&CIf P&C Extra DividendMandatum LifeNordea

Sampo Bank 2005-2006, Nordea 2007->

33

8/17/2017

*

*) If P&C made a sales gain in connection to the mandatory offer on Topdanmark shares and paid an extra SEK 2.8 billion (EUR 293 million) dividend to Sampo plc on 22 September 2016. In December 2016 If P&C paid a normal dividend of SEK 5.8 billion to Sampo plc.

**) On 26 January 2017 Nordea Bank AB’s Board of Directors proposed to the Annual General meeting to be held on 16 March 2017, a dividend of EUR 0.65 per share. With its current holding Sampo plc’s share amounts to EUR 559 million. The dividend is proposed to be paid on 27 March 2017. A dividend of EUR 125 million is planned to be paid by Mandatum Life during the first quarter of 2017. If P&C normally pays its dividend towards the end of the calendar year.


Reported Profits facilitates Debt Servicing

* Parent Company is not equal to Holding Segment; Dividend Income includes also dividends from Private Equity investments

747

-8 -37

702762

-10-70

683773

-17 -20

737

879

-20 -26

832

1,069

-18 -1

1,050

1,226

-14

17

1,229

1,567

-17

17

1,567

-100

100

300

500

700

900

1,100

1,300

1,500

1,700

Dividend income Operatingexpenses

Net financialexpenses

Profit before taxes

2010 2011 2012 20132014 2015 2016

*

EURm

34

8/17/2017

H1/2017 H1/2016Dividends 688.1 687.7Operating expenses -9.5 -4.9Net financial expenses/income -21.2 -17.7Profit before taxes 657.5 665.1


Issued Debt Instruments

EU

Rm

Instrument & Principal Coupon Swap Effective Rate Maturity

CPs issued 394 EURm Euribor + Margin 0.2500% Average 3M

Senior Bond 2,000 SEKm (EMTN) Stibor3M + 1.45% Euribor3M+1.375% 1.0460% 29.05.2018

Senior Bond 500 EURm (EMTN) 1.1250% --- 1.1640% 24.05.2019

Senior Bond 2,000 SEKm (EMTN) Stibor3M + 0.77% Euribor3M+0.586125% 0.2571% 28.05.2020

Senior Bond 1,000 SEKm (EMTN) 1.2500% EUR 1.007% 1.0070% 28.05.2020



Senior Bond 500 EURm 1.25% EUR6M + 0.735% 0.4810% 20.05.2025

Public debt EURm 3,151 0.8999% Private placements EURm 128 1.1821%Total EURm 3,279 0.9108%

35

8/17/2017


0200400600800

2017 2018 2019 2020 2021 2022 2023 2024 2025

CP´s Senior under EMTN Senior Retail Private

36

17 August 2017


If P&C Diversified P&C Insurer 18-23Mandatum Life A Finnish Financial Services Company 24-28Sampo plc Parent Company with Capacity to Generate Funds 29-35Appendix Separate Supplementary Information 36-47

Sampo Group’s Outlook for 2017

37

8/17/2017

Appendix – Separate Supplementary Information

Sampo Group’s business areas are expected to report good operating results for 2017.

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 a combined ratio of 86-89 per cent for the full-year 2017.

Nordea’s contribution to the Group’s profit is expected to be significant.

38

Structural changes of Sampo Group to the position as the leading Nordic financial group

Sampo Group’s (If P&C’s) Topdanmark holding exceeds 23 per cent and Topdanmark becomes If’s associated company.

Sampo Group (Mandatum Life) acquires Suomi Mutual’swith-profit group pension portfolio. The portfolio transfer takes place on 30 Decenber 2014.

Mandatum Life ends distribution agreement with Danske Bank.

Sampo Insurance Company and Leonia merge into the Sampo-Leonia financial services group. The Group’s business areas are long-term savings (life insurance, asset management and mutual funds), banking, investment banking, and P&C insurance.

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). Following the transaction, Sampo has three core businesses: P&C insurance, banking and long-term savings.

Sampo’s Nordea holding exceeds 20 per cent and Nordea becomes an associated company. Sampo Group (If P&C)

acquires Tryg’s Finnish Business and the acquisition was closed in May 2013.If P&C signs a partnership agreement with Nordea.

Sampo plc’s ownership of Topdanmarkexceeds 33.34 per cent after the acquisition of shares from If P&C and in the market and hence Sampo is obliged to make a mandatory offer for the share-holders of Topdanmark. As a result Sampo plc owns 46.7 per cent of Topdanmark’s shares and 49.3 per cent of votes. . Topdanmark now becomesSampo’s associated company.

Sampo Group divests SampoBank Group to Danske Bank A/S. Following the transaction, Sampo’s business areas are: P&C insurance and life insurance.

20052003200220012000 2008 2011 2012 2013 2014 2016 20172004 20072006 20102009 2015

Mandatum Bank joins the Group, and the Group’s name is shortened to Sampo.


SAMPO FICO GROUP

NORDEABANKINGGROUP

TOPDANMARK INSURANCEGROUP

Nordea Bank AB(SE) 21.3%

SIIGROUP

BANKINGGROUP

FICO GROUP

INSURANCE GROUP

Insurance BankingInvestmentServices

Other(non-regulated

unit)

Topdanmark A/S(DK) >41%

If IT Services A/S(DK)

IF P&C Insurance AS(EE)

IFINSURANCE GROUP

If P&C InsuranceHolding Ltd (SE)

IF P&C Insurance Ltd(SE)

IF P&C InsuranceCompany Ltd (FI)

Svithun Assurance AS(NO) 33%

Autovahinko-keskus Oy(FI) 33.5%

Latvia

Lithuania

Denmark

Norway

MANDATUMINSURANCE GROUP

Mandatum LifeServices Oy (FI)

Innova PensionServices Oy (FI)

Mandatum LifeLtd (FI)

Mandatum LifeBaltic SE (EE)

Mandatun LifeInvestment

Services Ltd (FI)

Mandatun LifeFund Manag.

Services Ltd (LU)

Latvia

Lithuania

IF Livförsäkring AB(SE)

CAB Group AB (SE) 22%

Urzus Group AS(NO) 30%

Various subsidiaries

Various subsidiaries

SAMPO SII GROUP

Source: FSA Finland, January 2017

Sampo Group ‒ Legal Supervision Structure

Sampo plc (FI)

Subsidiary Associated CompanyBranch 39

8/17/2017


Fixed Income Investmentsin the Financial Sector

Exposure tables vs. Allocation tables – small differences.

EURm Cov

ered

bon

ds

Mon

ey m

arke

t

Long

-term

se

nior

deb

t

Long

-term

su

bord

inat

edde

bt

Total %

Sweden 2,182 317 769 445 3,713 40%Finland 119 944 260 6 1,329 14%Norway 666 330 211 1,207 13%U.S. 344 681 1,024 11%Denmark 204 -19 282 60 526 6%UK 12 344 67 2 426 5%Netherlands 240 240 3%Canada 117 119 236 3%Switzerland 169 10 179 2%Australia 18 97 115 1%Iceland 96 96 1%Other 32 11 140 3 186 2%

Total 3,349 1,941 3,248 738 9,276 100%

40

8/17/2017

EURm Gov

ernm

ent

Gov

ernm

ent

guar

ante

ed

Publ

ic s

ecto

r,ot

her

Total

Sweden 96 697 794

Norway 216 216

Finland 78 88 166

Germany 65 65

Japan 17 17

Denmark 11 11

Total 96 153 1,019 1,268

Fixed Income Investments in the Public Sector


Sampo Group Steering Model and Principles

• Four separate and independent business areas and Sampo plc an active owner

• General Principles of Business activities – Straightforward and transparent legal structure combined with limited intragroup exposures – Clear responsibilities– Simple and flat operational structures– Personnel incentivized to increase shareholder value and guard profitability

• Parent company gives guidance to the subsidiaries by setting – Strategy – Targets for their capitalization and return on equity (RoE) – Group-wide principles for Risk Management, Remuneration, Compliance, Code of Conduct

and HR framework

• Subsidiaries organize underwriting activities independently taking into account– The specific characteristics of their operations– The above guidance from the parent company– The stakeholders’ expectations and external regulations

41

8/17/2017


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 mainly Funds– No diversification for the sake of diversification

• Centrally Managed – Sampo plc Chief Investment Officer is 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

42

8/17/2017


Principles of Capital Management

• Subgroups are adequately capitalized to ensure normal business operations

• At Group level the following issues are managed/monitored – Direct risk concentrations– Correlations of the subgroupsʼ profits – Sub-groups do not cross-capitalize each others, parent is the source of capital – The funds generating capacity of the parent company is maintained by having low leverage

and adequate liquidity buffers in normal situations

1 + 2 => Sampo Group is well-capitalized

43

8/17/2017


Calculation Principles of Sampo Group Solvency

• Group Solvency Capital– Under FICOD rules, capital is Group equity with some additional items added or deducted

(subordinated loans, deferred tax assets, planned dividends…)– Under SII rules capital – referred to as Own funds (OF) – consists mainly of excess of assets

over liabilities – Under normal circumstances Group OF by Solvency II and FICOD rules are close to

each other

• SCR by Financial Conglomerate Rules– The Group’s SCR is the sum of the separate sub-groups’ requirements (sectoral rules)– Banking rules are applied for the parent company – No diversification effect between the companies

• SCR by Solvency II rules – One capital requirement is calculated for the insurance group including the parent company

Sampo plc, If P&C and Mandatum Life. This includes diversification effects and also capital requirement for the translation risk related to SEK denominated equity of If P&C

– Nordea’s and Topdanmark’s capital requirements are added to the requirement – The SII SCR takes into account diversification only within the insurance group

=> Sampo Group Solvency Ratios are not comparable with most Insurance Groupsʼ solvency ratios44

8/17/2017


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 earnings– 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

For more detailed description of Sampo Group´s Risk Management Principles, see http://www.sampo.com/governance/internal-control/risk-management/

45

8/17/2017


Financial Strength Rating HistoryIf P&C Insurance Ltd (Sweden), If P&C Insurance Company Ltd (Finland),Sampo plc

The Sampo Groupʼs P&C insurance companies became part of If in January 2002.

2002 2003 2004 2005 2006 2007 2008 2009 -10 -11 -12 -13 -14 -15 -16 -17

Poss

ible

dow

ngra

de J

an 0

3

Stab

le F

eb 0

2

Neg

ativ

e Au

g 02

Stab

le A

pr 0

3

Poss

ible

upg

rade

Feb

04

Stab

le M

ay 0

4

Posi

tive

May

06

Stab

le N

ov 0

8Apr 04 First-time issuer rating

Aa3

A1

A2

A3

Baa1

Baa246

Posi

tive

Dec

15

Moodyʼs If P&CS&P If P&CMoodyʼs Sampo plcS&P Sampo plc

8/17/2017

Stab

le D

ec 1

6AA-/

A+

A/

A-/

BBB+/

BBB/


If P&C Reinsurance ProgrammesIf 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

• Largest & most diversifiedportfolio in the Nordics

• Focus purely on underwriting• Specialised Reinsurance Unit

• Reinsurance partners having reinsurance as core business

• Diversified financially strong panel of reinsurers

• Stable reinsurance program • Efficient pricing and

broad terms

47Additional reinsurance purchased for risks with property value accumulations according to Solvency II requirements.

8/17/2017

In MillionCatastrophe/

EventProperty/

Risk CasualtyPersonalAccident Motor TPL Cargo Reporter

Capacity SEK 6,300 SEK 2,500/4,750 SEK 500/€50/$50 SEK 1,100 Unlimited SEK 1,000

Retention SEK 250 SEK 250 SEK 100/€10/$15 SEK 100 SEK 100 SEK 100

In MillionMarine HullReporter

Small VesselsClash Cover

Marine Hull I.V. Reporter

Marine Hull WarRisk Reporter

US TerrorismRisk

Capacity SEK 550 SEK 250 SEK 310 SEK 600 USD 250

Retention SEK 100 SEK 100 SEK 100 SEK 2.5 USD 25

Casualty/Cyber Event

SEK 400/€40/$50

SEK 200/€20/$25


Debt Investor Presentation - Sampo Group · 08/02/2017 Financial Statement Release for 2016. ......

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