Debt Investor Presentation - Sampo Group · Week 11 Annual Report 2017. 19/04/2018 AGM. 09/05/2018 Interim Statement Q1/2018. Silent period 09/04/2018-9/05/2018. ... This presentation

Debt Investor Presentation

PREPARED February 8, 2018FIGURES January-December, 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 2018

07/02/2018 Financial Statement Release for 2017Silent period 08/01/2018-07/02/2018

Week 11 Annual Report 201719/04/2018 AGM09/05/2018 Interim Statement Q1/2018

Silent period 09/04/2018-9/05/201808/08/2018 Half-Year Financial Report 2018

Silent period 09/07/2018-08/08/201807/11/2018 Interim Statement Q3/2018

Silent period 08/10/2018-07/11/2018

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

Sampo Group Nordic Financial Group with Strong Brands 3-18

If P&C Diversified Nordic P&C Insurer 19-24Mandatum Life A Finnish Financial Services Company 25-29Sampo plc Parent Company with Capacity to Generate Funds 30-37Appendix Separate Supplementary Information 38-49

3

Sampo Group structure

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

~ EURbn 11.5

• RoE above 17.5%• CR% below 95%

The second largest P&C insurer in Denmark

Customer satisfaction• Pricing• Efficiency

• Digitalisation, Processoptimisation, transformation

• Distribution efficiency

~ EURbn 2.9 (P&C)

• Profit margin of 10%• CR% 91%

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

~ EURbn 6.3

• RoE above 17.5%

• Long-term investor• Manager of capital structure and liquidity

• Pay-out ratio ≥ 50%

Market position

Strategy

Investmentassets

Return /profit target

Subsidiary Subsidiary

100% > 45% 100%

The most diversified bankingin the Nordics with strong capital generation

Transformation to be the Future Relationship Bank• Efficient and scalable• Fast and agile• Resilient and compliant

~ B/S EURbn 582~ AuM EURbn 330

• ROE above the Nordic peer average

Associated Company

21.2%

Sampo Group ― Nordic Financial Group with Strong Brands

Subsidiary

4

40.230.6

26.526.2

23.222.322.0

18.07.5

6.15.9

4.13.53.3

1.70.80.6

NordeaDanske

DNBSampo

SwedbankSHBSEB

InvestorGjensidige

IndustrivärdenTryg

JyskeTopdanmark

StorebrandAlm.Brand

ProtectorNordax

Efficient and Stable Operations as Basis for Value

Source: Thomson Reuters

>45%

*100% owned by the Republic of Finland; 31.12.2017

A Mixed Financial ConglomerateMarket cap January 31, 2018, EURbn

BankInsuranceInvestment company

Foreign and Nominee registered 62.40%

Solidium 12.00%*

Varma Mutual Pension Ins.Co. 5.39%

Björn Wahlroos 1.80%

The State Pension Fund 0.70

Ilmarinen Mutual Pension Ins.Co. 0.67%

Other domestic owners 17.03%

>21%

In total over100,000 owners

Strong relative performance10Y Total Shareholder Return

Sampo ownership structure


5

1-12/2017 Result • Pre-tax profit EURm 818 (824)• Comprehensive income EURm 581 (655)• Excellent combined ratio of 85.3% (84.4)

– Risk ratio 63.3% (62.3); Cost ratio 22.0% (22.1)– Expense ratio 16.4% (16.6)

• ROE%: 21.3% (25.3%)

If P&C ‒ A Diversified Nordic P&C Insurer• Diversified and profitable subsidiary• Provides insurance solutions and services

in the Nordic and Baltic regions as well asto 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 comprise a separate business area

• More than 3.7 million customers• Employees ~6,400• Leading Nordic insurer with a Nordic

market share of 17%, 22% with Topdanmark

549

644

707

636

864

929

931

960

883

818

-267

1,12

7

943

308

978

689

526

624

714

581

-400-200

0200400600800

1,0001,200

Profit before tax

Comprehensiveincome

Strong & Stable Annual Profit DevelopmentEURm

68.1

68.0

69.1

68.4

65.9

65.4

65.1

66.6

62.3

63.3

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

85.3

020406080

100%

Cost ratio

Risk ratio

TargetCR

Combined Ratio Development


6

1-12/2017 Result• Topdanmark’s contribution to Group Pre-tax profit EURm 848 (59)including EURm 706 from valuing of Topdanmark to fair value• Combined ratio 82.0% (85.1)

– Claims ratio 65.8% (68.7); Expense ratio 16.1% (16.4)

• A profitable subisdiary with robust 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 9%• 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 its stakeholders

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

Profit before taxes, DKKm

Combined Ratio,%

72.2 75.4 70.3 70.9 68.7 65.8

15.8 16.2 15.7 15.9 16.4 16.1

0

20

40

60

80

100

2012 2013 2014 2015 2016 2017

%

ExpenseratioClaimsratioTargetCR

85.186.886.091.588.0

Topdanmark – A Danish Non-life and Life Insurer


82.0

2013 2014 2015 2016 2017(100)

0100200300400500600700800 Parent company etc. Life insurance Non-life insurance

7

0500

1,0001,5002,0002,5003,0003,5004,0004,5005,000 Other WP-liabilities

Segregated Group PensionWP-liabilities (3,5% guarantee)WP-liabilities (4,5% guarantee)

1-12/2017 Result• Pre-tax profit EURm 236 (210) • Comprehensive income EURm 188 (232)• ROE%: 13.3% (15.9%)

140

121

142

137

136

153

163

181

210

236

-378

495

332

-115

286

220

149

168

232

188

-500

-250

0

250

500

Profit beforetaxes

Comprehensiveincome

Profit Development, EURm

• 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.

With-Profit Technical Provisions Forecast *, EURmCurrent

* Unit-linked Technical Provisions 31.12.2017 EUR 7,066m

• Provides a comprehensive range of servicesin Finland and Baltics for private and corporate customers

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

reward services• Customers ~275,000 (Finland)• Employees ~520• A leading life and pension insurer in Finland

with ca 20% market share


Mandatum Life ‒ A Finnish Financial Service Company

8

• The Largest financial services group in the Nordic region and one of the biggest banks in Europe

• Diversified and stable returns• Global presence, local expertise: a full-service

universal bank• Business areas: Personal Banking, Commercial

Banking & Business Banking, Wholesale Bankingand Wealth Management

• Present in 17 countries incl. four Nordic home markets: Denmark, Finland, Norway and Sweden

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

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

1-12/2017 Result• Nordea’s contribution to the Group

‒ Pre-tax profit EURm 616 (773)‒ Comprehensive income EURm 559 (791)

• Excellent C/I ratio of 54% (48)• Common Tier1 ratio 19.5% (18.4)• ROE%: 9.5% (2016:11.5)• Nordea book value in Group accounts EURm 7,578

(+positive valuation difference EURm 1,102)

-2000

200400600800

1,0001,2001,4001,600 Restructuring/

impairmentcharges/gainsLoan losses

Operatingprofit

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

17 24 36 55

74

131

Nordea Peer 1 Peer 2 Peer 3 Peer 4 Peer 5

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

Low Quarterly Result Volatility, EURm

-17

Nordea – A Nordic Banking Group


9

• 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–Q4/2017

PBT 2010-17

IF 45%ML 10%Nordea 45%

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

0.27

0.15

1

0.85 1

1


0.37 0.67 0.69 1

• Denmark• Second largest insurance

company• Nation-wide businesses

‒ Non-life insurance‒ Life insurance‒ Pension fund

• Stable insurance riskand low C/R volatility

LOW VOLATILITY C/R

*Topdanmark will beincluded in 2018

10

948

1,295 1,353

870 825

1,320 1,228

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

2,482

-2000

200400600800

1,0001,2001,4001,6001,8002,0002,2002,4002,600

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017Topdanmark Holding Banking Life P&C

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


** Includes 706 EURmfrom valuing of Topdanmarkto fair value (with shareprice DKK 247.7)

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

**

11

Risk Profiles of Investments

* consolidated


Total Group (mEUR)

Money Market 8% 13% 75% 4% 5% 6% 73% 6% 11% 35% 7% 11% 57% 3% 14% 74% 4%Long-Term Fixed Income 79% 47% 20% 67% 82% 53% 21% 81% 51% 55% 80% 50% 33% 84% 49% 18% 68%Equity 13% 26% 5% 12% 13% 27% 4% 13% 25% 5% 12% 26% 8% 13% 25% 7% 10%Private Equity 0% 4% 0% 1% 0% 4% 0% 0% 3% 0% 0% 3% 0% 0% 3% 0% 3%Other 0% 10% 1% 16% 0% 10% 1% 0% 9% 5% 0% 9% 2% 0% 8% 1% 15%

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

26,524 20,813 20,111 19,786 25,286

12,192

6,582

1,933

5,816

12,337

6,547

1,929

12,319

6,507

1,285

12,367

6,331

1,088

11,459

6,263

1,620

5,944

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

IfP

&C

Man

datu

mLi

fe

Sam

poP

lc

Topd

anm

ark

IfP

&C

Man

datu

mLi

fe

Sam

poP

lc IfP

&C

Man

datu

mLi

fe

Sam

poP

lc IfP

&C

Man

datu

mLi

fe

Sam

poP

lc IfP

&C

Man

datu

mLi

fe

Sam

poP

lc

Topd

anm

ark

*

12

Investments & Counterparty Exposures excl. Topdanmark *

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


31.12.2017AAA AA+ -

AA-A+ - A-

BBB+ - BBB-

BB+ - C D Non

Rated

Fixed Income

TotalEquities Other

Derivatives (Counterparty

Risk)Total

Change from

30.9.2017

Basic Industry - - 44 66 25 - 113 248 103 - - 351 + 1Capital Goods - - 127 63 - - 131 321 680 - - 1,001 - 33 Consumer Products - 131 326 380 30 - 109 976 549 - - 1,525 - 32 Energy - 68 30 - 53 - 172 323 13 0 - 336 - 9 Financial Institutions - 1,895 3,251 921 46 - 26 6,140 118 1 9 6,268 + 76Governments 92 - - - - - - 92 - - - 92 - 4 Government Guaranteed 43 77 - - - - - 120 - - - 120 - 33 Health Care 7 39 50 50 42 - 65 253 113 - - 366 + 12Insurance - - 41 115 27 - 5 189 3 25 - 217 - 67 Media - - 14 - - - 38 52 - - - 52 - 1 Packaging - - - - 19 - 14 33 1 - - 33 - 13 Public Sector, other 674 192 42 - - - - 908 - - - 908 - 51 Real Estate - 6 92 112 8 - 527 745 - 207 - 952 + 22Services - - - 85 72 - 155 312 122 0 - 434 + 4Technology and Electronics 23 - 79 - 27 - 45 175 123 - - 298 - 8 Telecommunications - - - 165 8 0 65 238 92 0 - 331 - 21 Transportation - 72 11 55 11 - 203 353 34 - - 387 - 11 Utilities - 2 32 359 70 - 44 506 0 - - 506 - 30 Others - 26 - - 4 - 15 45 0 36 - 81 - 5 Asset-backed Securities - - - - - - - - - - - - + 0Covered Bonds 3,161 75 - 10 - - - 3,247 - - - 3,247 - 141 Funds - - - - - - 142 142 1,187 521 - 1,849 - 96 Clearing House - - - - - - - - - - 17 17 - 4

Total 4,000 2,583 4,140 2,382 443 0 1,869 15,417 3,139 790 26 19,372 - 444

Change from 30.9.2017 - 129 - 389 + 546 - 244 + 19 - 18 - 48 - 263 - 145 - 29 - 7 - 444 EURm

13

Mandatum Life – Solvency II Capital Requirement (SCR)With transitional measures, December 31, 2017

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

* Own Funds without transitional measures EUR 1,555m

EURm SF with transitional measures Solvency ratio 182%

1,263

68408 297

38 121272

1,087

272

1,977

0

500

1,000

1,500

2,000

2,500


*

14

EURm

672

1,40

4

272

790

167 215

1,51

0

3,87

5

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

1,35

8

1,15

0

9249

6

167 332

1,93

8

3,81

8

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

Internally assessed Solvency ratio 257%Standard Formula Solvency Ratio 197%

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

EURm

S&P TTC for A rating 3,098 EURm S&P TTC for A rating 3,098 EURm

If P&C Solvency Capital Requirement December 31, 2017


15

EURm

Partial Internal Model Solvency ratio 204%

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

16

Topdanmark Solvency Capital Requirement December 31, 201776

8

27

376 181

62

446

92

514

856

0

200

400

600

800

1,000

1,200

1,400

Standard Model Solvency ratio 166%

EURm

768

27201 12

2

62

446

72

419

856

0

200

400

600

800

1,000

1,200

1,400


1,938

1,087514

3,441184

7,163

11,021

0

2,000

4,000

6,000

8,000

10,000

12,000

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

Topdanmark Sampo plc'sshare ofNordea

Sampo plc Total capitalrequirement

GroupSolvencyCapital

Group Solvency Capital by Financial Conglomerate Rules December 31, 2017

EURmGroup solvency ratio 154% / SII Standard Formula applied for Insurance Subsidiaries

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


17

Value Creation in the Nordic Financials as Group Strategy

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.

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.


18



19

59%26%

12%3%PrivateCommercialIndustrialBaltic

By Business Area By Country

65%

23%

8%2%2%

PrivateCommercialIndustrialBalticOther

Technical Results,EURm 640

42%

36%

17%1%

2%2% Norway

SwedenFinlandDenmarkBalticOther

Gross WrittenPremiums, EURm 4,526

31%

36%

21%

9%3% NorwaySwedenFinlandDenmarkBaltic

If P&C – Diversified Nordic P&C Insurer

Diversified Client Base

1-12/2017

20

Expense ratio 2016, %

Combined Ratio ‒ If P&C and Nordic Weighted Average

If P&C and BA Combined Ratios and deviation

Standard deviation 2008-20173.2%

4.3%

4.8%

3.7% (->2016)

3.9%

92.8 92

88.9

88.1

87.7

85.4

84.4

96.1

96.1

91.5

91.3

88.5

88.9

87.6

75

80

85

90

95

100

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

Disciplined Underwriting and Diversification work

%

16.416.617.218.2

25.326.927.428.7

31.831.9

TopdanmarkIf P&C

Nordic market excl. IfRSA Scandinavia

Direct LineAXA

GeneraliAllianz

ZFSAviva

Private Commercial

Industrial

Baltic

If P&C

Norway

Sweden

Finland Denmark

0

2

4

6

8

10

12

86 88 90 92 94 96

CR

% S

tand

ard

devi

atio

nQ

1/20

08-Q

4/20

17

Average CR% Q1/2008-Q4/2017


21

Conservative Investment Portfolio

• Duration 1.4 years• Average Maturity 2.7 years• Fixed Income Running Yield 1.5%

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%2.6%

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

11%14%

Mark-to-Market Investment Return, EURm821

113

689558

459

190334 304

0200400600800

1,000

2010 2011 2012 2013 2014 2015 2016 2017

Total EUR 11.5bn


Money Market 3%

Public Sector 9%

Other Fixed

Income48%

Covered Bonds27%

Equities13%

Private Equity 0.2 % Real Estate0.2 %

Other 0.0 %

22

0

50

100

150

200

250

300

350

Investment result

Technical 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% 83.6 84.8 85.7 87.4

EURm

* incl. positive one-off


23

Nordic P&C Insurance Market

23

21

18

6

12

17

Finland

Norway

Sweden

Denmark/ If P&C +Topdanmark

Baltics

If18%

Topdanmark5%

Tryg9%

LF10%

Codan9%

Gjensidige8%

Folksam6%

OP6%

LähiTapiola4%

Other25%

If + Topdanmark 23%

Total premiums EUR 26 bn

• 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, %


24



25

Premiums Written, EURm 966

Insurance SavingsEURm 10,784

243

131454

2266 48

2

2,489

2,178

2,231164

161

3,520

26 15

Unit-linked life Unit-linked pensionUnit-linked capital redemption Unit-linked BalticOther life Other pensionOther capital redemption Other Baltic

Mandatum Life Business Volumes

U-LEURm 7,062

With-ProfitEURm 3,722

U-L EURm 850

With-ProfitEURm 116

4,65

2

4,62

6

4,73

8

4,69

5

4,62

1

4,48

7

4,43

1

4,41

0

4,24

9

4,07

1

3,92

7

5,06

5

5,01

4

4,82

1

4,57

2

607

884

1,26

2

1,75

2

2,07

1

1,63

7

2,35

9

3,12

4

3,05

4

3,83

3

4,61

6 5,31

2

5,85

8

6,44

0

3,96

63,

100

0

2,000

4,000

6,000

8,000

10,000

12,000 Portfolio to be transferred to Danske Bank GroupUnit-linkedGuaranteed interest rates

Technical Provisions, EURm 11,638

EURm

Mandatum Life - A Finnish Financial Services Company

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

1-12/2017

26

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% 5.60%

-10%

-5%

0%

5%

10%

15%

20%

615

-59

504391

251

427 440 376

-1000

100200300400500600700

2010 2011 2012 2013 2014 2015 2016 2017

• Duration 2.1 years• Average Maturity 2.5 years• Fixed Income Running Yield 2.3%

Mark-to-Market Investment Return, EURm


Asset Allocation 31.12.2017, 6 263 EURm

Money Market Securities and

Cash15 %

Government Bonds

1 %

Credit Bonds, Funds and

Loans48%

Listed Equity25 %

Real Estate3%

Private Equity3 %

Unlisted Equity0 %

Biometric0,3%

Commodities0 %

Other Alternative

4 %

Trading Derivatives

0 %

27

Mandatum Life Profit by Components

Total expense ratio, % 93.9 98.7Incl. kick backs, % 76.4 80.5

EURm 1-12/2017 1-12/2016Net investment income 780.8 632.4

- Transferred to expense result -26.2 -24.6- Return on Unit-linked policies -405.0 -276.0- Return on With-profit policies* -171.4 176.1

INVESTMENT RESULT 178.2 155.7EXPENSE RESULT** 33.2 26.1RISK RESULT 34.7 31.3OTHERS -10.1 -3.5PROFIT BEFORE TAXES 236.0 209.6Change in the market value of investments 5.4 82.2PROFIT AT MARKET VALUES 241.4 291.8

Mandatum Life Group, expense ratio

* Includes guaranteed interest, bonuses and change in the reserves of the above items** Result of Unit-linked business EURm 25.5


28

Life insurance Market

Nordea31%

Mandatum Life24%

OP Life22%

LähiTapiola9%

Fennia5%

Sp-Henkivakuutus

3%

Aktia 2%

Other4%

Total premiums EUR 4.5 bn

• 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, %


29



30

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 10,939 Liabilities 10,939

Liquidity 1,199 CPs Issued 293

Investment assets 235 LT Senior Debt 2,884

- Real Estate 2 - Private Placements 138

- Fixed Income 58 - Bonds Issued 2,746

- Equity & Private Equity 175 - Pension Insurance loans

Subordinated Loans 496 Subordinated Debt 0

Equity Holdings 8,958 Capital 7,714

- Subsidiaries 3,401 - Undistributable 98

- Associated 5,557 - Distributable 7,616

Other Assets 50 Other Liabilities 48

Flow of Funds Balance Sheet, EURm

Key Credit Metrics well in Single A rangeSampo plc 31.12.2017Gross Debt, EURm 3,177Gross Debt to Equity 41%Financial Leverage 29% (= Debt/(Debt+Equity)

Sampo Group, EURm Q4/2017Shareholders' Equity 13,508Hybrid Bonds 376Senior Debt 3,177Financial leverage 22.9%

Sampo plc - Parent Company with Capacity to Generate Funds

31

Cash and tradable financial investments 31.12.2017

• 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


InstrumentMarket Value/

Nominal AmountRunning

YieldCall Date

Cash 1 199Investment Assets 235Sub-Ordinated Loans 496 5,10 % - Mandatum Life T1 Perpetual EUR 100 4,42 % Annual - IF T2 30NC10 EUR 99 6,07 % 8.12.21 - Nordea AT1 PerpNC5 USD 171 5,95 % 23.9.19 - Nordea AT1 PerpNC5 USD 98 6,48 % 13.9.21 - Topdanmark T2 PerpNC5 DKK 135 2,92 % 11.12.20 - Topdanmark T2 PerpNC5.5 DKK 270 2,40 % 11.6.21Total 1 930

32

Sampo plc Sources and uses of Funds / First Half Year 2018


Sources EUR Uses EUR

Cash balance (as of 31.12.2017) 1 199m Nets 230mSale of liquid assets 76m Saxo Bank 265mBond issued 500m Nordax 249mMandatum Life dividend 150m Sampo dividend 1 444mNordea dividend 585m Repayment of CP 293mTopdanmark dividend 107mTotal Sources 2 617m Total Uses 2 481m

Cash Balance as of May 2018: 136m

33

Sampo Group ― Conservative Leverage

-4,000-2,000

02,0004,0006,0008,000

10,00012,00014,00016,000

Q1/

05

Q1/

06

Q1/

07

Q1/

08

Q1/

09

Q1/

10

Q1/

11

Q1/

12

Q1/

13

Q1/

14

Q1/

15

Q1/

16

Q1/

17

Q1/

18

Sampo plc Net debtGroup NAVGroup Equity

EURm

0%

5%

10%

15%

20%

25%

30%

35%

40%

Q1/

05

Q1/

06

Q1/

07

Q1/

08

Q1/

09

Q1/

10

Q1/

11

Q1/

12

Q1/

13

Q1/

14

Q1/

15

Q1/

16

Q1/

17

Q1/

18

Net debt/NAV

• ”Loan-To-Values” based on above figures is low• Parent Companyʼs Financial Leverage is 29% => Sampoʼs position to refinance its debt is strong


34

Dividends Received by Payment Year

EURm

249

1,031

519

181

488 540406

544 490597 587 586 620

293

100

300

200

200

100100

100 100

125

275

150

141

75

35

13080

204 250 224293

370533

551557

585

107

490

1,406

754

511 568

744 756 768883

1,067

1,220

1,5551,452

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 2018**

TopdanmarkNordeaMandatum Life Extra DividendMandatum LifeIf P&C Extra DividendIf P&C

Sampo Bank 2005-2006, Nordea 2007->

*


*) Extra dividend **) Nordea Bank AB’s Board of Directors proposes to the Annual General meeting to be held on 15 March 2018, a dividend of EUR 0.68 per share. With its current holding Sampo plc’s share amounts to EUR 585 million. The dividend is proposed to be paid on 26 March 2018. A dividend of EUR 150 million is planned to be paid by Mandatum Lifeduring the first quarter of 2018. If normally pays its dividend towards the end of the calendar year.

35

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

1,5671,453

-14 -43

1,396

-100

100

300

500

700

900

1,100

1,300

1,500

1,700

Dividend income Operating expenses Net financial expenses Profit before taxes

2010 2011 2012 20132014 2015 2016 2017

*

EURm


36

Issued Debt InstrumentsE

UR

mInstrument & Principal Coupon Swap Effective

Rate MaturityCPs issued EURm 293 Euribor + Margin 0.2500% Average 3M

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

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

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

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



Senior Bond EURm 500 1.25% EUR6M + 0.735% 0.4610% 20.05.2025

Public debt EURm 3,040 0.9190% Private placements EURm 138 1.1128%Total EURm 3,178 0.9274%


0

200

400

600

800

2018 2019 2020 2021 2022 2023 2024 2025

CP´s Senior under EMTN Senior Retail Private

37


If P&C Diversified P&C Insurer 19-24Mandatum Life A Finnish Financial Services Company 25-29Sampo plc Parent Company with Capacity to Generate Funds 30-37Appendix Separate Supplementary Information 38-49

38

Sampo Group’s Outlook for the rest of 2018

Appendix – Separate Supplementary Information

Sampo Group’s business areas are expected to report good operating results for 2018.

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.

If is expected to reach its long-term combined ratio target of below 95 per cent in 2018 by a margin.

With regard to Topdanmark reference is made to the profit forecast model that the company publishes quarterly.

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

39

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.

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


Topdanmarkbecomes Sampo plc´ssubsidiary as of 30 Sept 2017

20052003200220012000 2008 2011 2012 2013 2014 2016 20172004 20072006 20102009 2015 2018

40

SAMPO FICO GROUP

NORDEABANKINGGROUP

TOPDANMARK INSURANCEGROUP

Nordea Bank AB(SE) 21.3%

SIIGROUP

BANKINGGROUP

FICO GROUP

INSURANCE GROUP

Insurance BankingInvestmentServices Other

Topdanmark A/S(DK) 49.3%

If IT ServicesA/S (DK)

IF P&C InsuranceAS (EE)

IFINSURANCE GROUP

If P&C InsuranceHolding Ltd (SE)

IF P&C InsuranceLtd (SE)

Svithun AssuranceAS (NO) 33%

Autovahinko-keskus Oy(FI) 33.5%

Latvia

Lithuania

Denmark

Norway

MANDATUMINSURANCE GROUP

Mandatum LifeServices Oy (FI)

Mandatum LifeLtd (FI)

Mandatum LifeInvestment

Services Ltd (FI)

Mandatum LifeFund Manag.

Services Ltd (LU)

Latvia

Lithuania

IF Livförsäkring AB (SE)

CAB Group AB (SE) 22%

Urzus Group AS(NO) 30%

Various subsidiaries

SAMPO SII GROUP

Source: FSA Finland, February 2018

Subsidiary Associated CompanyBranch

Finland

EstoniaTopdanmarkForsikring A/S

(DK)

Danske ForsikringA/S (DK)

Topdanmark LivHolding A/S

(DK)

TopdanmarkLivforsikring A/S

(DK)

NykreditLivforsikring A/S

(DK)

TopdanmarkKapitalforvaltning

A/S (DK)

Topdanmark Invest A/S (DK)

TopdanmarkEjendom A/S

(DK)

NORDEAINSURANCE GROUP

Nordea LifeHolding AB (SE)

Various subsidiaries

Branch

Sampo plc (FI)

Sampo Group ‒ Legal Supervision Structure


41

Fixed Income Investments in the Financial Sector

Exposure tables vs. Allocation tables – small differences.

EURmCovered

bondsMoney market

Long-term senior

debt

Long-term subordinated

debt Total %

Sweden 2,092 42 721 365 3,221 34%

Finland 108 1,584 243 6 1,942 20%

Norway 670 324 291 1,285 13%

U.S. 670 670 7%

Denmark 204 3 277 142 626 7%

UK 12 517 68 18 615 6%

France 21 179 58 258 3%

Netherlands 226 18 244 3%

Canada 111 113 224 2%

Switzerland 147 147 2%

Australia 17 92 109 1%

Other 10 22 190 11 234 2%

Total 3,247 2,348 3,129 852 9,576 100%

EURm GovernmentGovernment guaranteed

Public sector,other Total

Sweden 92 592 684

Norway 211 211

Finland 77 88 165

Germany 33 33

Japan 17 17

Denmark 10 10

Total 92 120 908 1,120

Fixed Income Investments in the Public Sector


Fixed Income Investment Segementation excl. Topdanmark

42

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/contributing • 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


43

Principles of Investment Management excl. Topdanmark• 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


44

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 subgroups' 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


45

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, Topdanmark and

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

• Nordea’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 ratios


46

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


*Topdanmark is in a process to align its business practices with Sampo Group principles

47

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 -18

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

8

Apr 04 First-time issuer rating

Aa3

A1

A2

A3

Baa1

Baa2

Posi

tive

Dec

15

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

Stab

le D

ec 1

6AA-/

A+

A/

A-/

BBB+/

BBB/


48

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

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

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


49

Documents

Debt Investor Presentation - Sampo Group · Week 11 Annual Report 2017. 19/04/2018 AGM. 09/05/2018 Interim Statement Q1/2018. Silent period 09/04/2018-9/05/2018. ... This presentation