Triglav Group Xxxx Presentation
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Triglav Group Investor Presentation 2017 Results March 2018 Table of Contents About Triglav Group and Financial Highlights General information ……………………………………………………………………………….………………………………………....................................... 5 Core Business …………………………………………………………………………….………………………………………………….…....................................... 6 Capital Management Policy …………………………………………………...................................................................................................... 9 Capital Adequacy, Risk Profile ………………………………………………………………………………................................................................... 10 Dividend Policy……………………………………………………………………….………….......................................................................................... 11 Equity Story ……………………………………………………………………………...................................................................................................... 12 Shareholders, ZVTG Share ……………………………………………………………………………….......................................................................... 13-14 Management Board ..…....................................................................................................................................................................... 15 Financial Reporting Triglav Group in 2017 ……………………………………………………………………………….................................................................................. 17-18 Structure of Profit before Tax of Triglav Group ……………………………………………………………………………………………….………………. 19-20 Equity, ROE and Gross Technical Provisions ……………………………………………………………………………………………………….…………… 21 Gross Written Premium ……………………………………………………………………………….............................................................................. 22-23 Triglav Group’s Markets ……………………………………………………………………………….............................................................................. 24-26 Combined Ratio ………………………………………………………………………………………………………………………................................................ 27 Gross Claims Paid …………………………………………………………………………………………………………………………………………………………..…… 28 Asset Allocation, Investment Portfolios ……………………………........................................................................................................ 29-32 Triglav Group Strategy, Outlook 2018 ……………………………………………........................................................... 34-35 Appendix Markets (Slovenia, Croatia, Serbia, B and H, Montenegro, Macedonia) ………………………………………………………………….…… 37-42 Financial Calendar 2018 ……………………………………………………………………………………………………………………………………………………. 44 IR Calendar 2018Triglav ……………………………………………………………………………….......................................................................................... Group: 2017 Results 45 About Triglav Group Triglav is the highest mountain in Slovenia and the highest peak of the Julian Alps (2,864 meters/9,396 ft). Triglav Group: 2017 Results 4 Triglav Group - 118 years of tradition and experience Triglav Group: ▪ Parent company Zavarovalnica Triglav, 31 subsidiaries and 6 associated companies ▪ Over 5.000 employees Core business: ▪ Insurance, Asset management Ratings: ▪ A/stable outlook (S&P Global Ratings, AM Best) Market presence and ▪ Leading insurance - financial group in Adria region and in Slovenia position: ▪ In 6 countries in Adria region, global through inward reinsurance 20% market share in Adria region (2016) GWP of Triglav Group by markets (2017) 5,5% Slovenia Triglav Group 19.9% Other markets Croatia Group 8.9% Global Reinsurance Sava Re Group 8.8% 17,7% Generali 7.4% Adriatic Slovenica 6.7% Agram 6.2% 76,8% Vzajemna 6.1% Croatia 5.4% VIG 5.7% Dunav 4.4% Uniqa 3.9% Slovenia 76.8% Serbia 4.4% Grawe 3.5% Allianz 3.5% B and H 2.7% Source: Calculation based on the data of regional regulators Macedonia 2.1% Triglav Group: 2017 Results Montenegro 3.1% 5 Core Business of Triglav Group ▪ Insurance Structure of GWP (2017) 12.9% − Non-life − Life 21.8% − Supplementary pensions Non-life − Health Life − Reinsurance Health 65.2% ▪ Asset Management Insurance portfolios and own funds (without united-linked products) (2017) − Insurance portfolios and own funds: o 2.7% 1.1% AUM € 2,688 million 1.3% o Liability driven investing 3.5% Debt and other fixed return securities − Investment funds: Shares and other floating rate securities 8.1% o AUM € 725.5 million 17 mutual funds Investment property o Investment fund in Bos. and Herz. Deposits with banks Loans given Other 83.2% Triglav Group: 2017 Results 6 Triglav Group with Strong Credit Ratings ▪ S&P Global Ratings rating A/stable outlook Credit rating agency Credit rating Medium-term Date outlook ▪ A.M. Best rating A/stable outlook A.M. Best A stable 30-Oct-2017 S&P Global Ratings A stable 8-Sep-2017 From S&P GR Rating 2017 Report: A.M. Best A stable 28-Oct-2016 S&P Global Ratings A stable 1-Jul-2016 The credit rating exclusively reflects the Group's standalone credit A.M. Best A- positive 16-Oct-2015 profile and does not include any uplift from the Group's status as a government-related entity. Standard & Poor's A- positive 29-Aug-2015 A.M. Best A- positive 3-Oct-2014 S&P assessed the business risk profile of Triglav Group as strong, Standard & Poor's A- stable 26-Sep-2014 its financial risk profile as very strong and its capital adequacy as extremely strong. Group had adequate reinsurance protection. Standard & Poor's A- stable 7-Jul-2014 A.M. Best A- stable 17-Oct-2013 S&P pointed out the notable advantages arising from the Standard & Poor's A- stable 4-Jul-2013 consistent strategic guidelines of Triglav Group (focus on A.M. Best A- stable 21-Mar-2013 profitability and safety of its operations; Group’s operations focus on only two business pillars: insurance and asset management). Standard & Poor's BBB+ positive 14-Feb-2013 S&P expressed the same positive opinion in respect of growing Standard & Poor's A- negative 8-Aug-2012 strategic importance, development of asset management and the Standard & Poor's A negative 21-Nov-2011 new, particularly development-oriented components of the Standard & Poor's A stable 25-Nov-2010 Group’s operations, which include digitisation, integrated client management, and the development of new products and sales Standard & Poor's A stable 25-Aug-2009 channels, which have already been assessed as favourable by S&P. Standard & Poor's A stable 25-Sep-2008 Triglav Group: 2017 Results 7 Profitable and Safe Operations ▪ Focus on profitablity, safety of operations and greater value of Triglav Group ▪ Strategic goal: ROE over 10% in 2020 43 58 90 84 100 102 95 84 80-90 16% 120 5.5% 9.6% 13.8% 12.0% 13.4% 12.8% 11.4% 9.3% 14% 100 12% 80 10% 8% 60 6% 40 4% 20 2% 0% 0 2010 2011 2012 2013 2014 2015 2016 2017 Plan 2018 PBT (in €m) ROE (%) Triglav Group: 2017 Results 8 Strategic Objectives of Capital Management and Dividend Policy ▪ Revised in March 2018 Possibility of a more aggressive growth of business volume and the > 250% Surplus capital assessment of the potential changes in the business strategy including adequacy increasing the amount of dividends Target capital With regular risk management activities, the dividend is in line with the 200 - 250% adequacyAnalizadividend ciljnepolicy kapitalske Sub-optimum ustreznostiBy analysing available Skupinemedium and long -term measures for capital 150 - 200% level of capital adequacy improvements the increased risk management activities including reducing the amount of dividends adequacy Triglav Warning level of The implementation of measures to improve capital adequacy including capital 130 - 150% reduction of the amount of dividends adequacy < 130% Insufficient capital adequacy Triglav Group: 2017 Results 9 Risk Profile and Strong Capital Adequacy ▪ As at 31 Dec 2017: Capital adequacy estimated to be within the target range of 200–250% - Amended capital management policy, target risk profile unchanged, capital adequacy target range 200 – 250% - Calculation in accordance with new methodology - Disclosure of Solvency and Financial Condition Report for 2017 by 6 May 2018 퐸푂퐹 - Solvency ratio (31 Dec 2016) = = 242% (Calculated in accordance with Solvency II regulation and Triglav Group’s 푆퐶푅 methodology, valid in 2016) ▪ Risk profile of Triglav Group (as at 31 Dec 2016): - Level of risk exposure acceptable and in line with the defined 2% risk appetite 3% - All individual types of risks are effectively managed („three 5% lines of defence” system) 42% 7% Market risk Underwriting risk Credit risk Operational risk Risk - financial companies of the Group 41% Risk - nonfinancial companies of the Group Triglav Group: 2017 Results 10 Atractive and Sustainable Dividend Policy (Revised in March 2018) The minimum dividend pay-out is set to 50% of consolidated net profit for the previous year, however Zavarovalnica Triglav will strive not to reduce its dividend payment below the level of the previous year. As thus far, the future implementation of the dividend policy will be subordinated to achieving the medium-term sustainable target capital adequacy of Triglav Group. The proposal of the Management Board and the Supervisory Board as regards the annual distribution of accumulated profit of the Company will therefore take into account the following three objectives in a balanced manner: to ensure prudent capital management of Triglav Group and its financial stability, to reinvest net profit in the implementation of the strategy of growth and development of Triglav Group and Analizato pay out attractive dividendsciljneto the kapitalskeshareholders. 9.1 15.9 45.5 ustreznosti38.6 56.8 56.8 Skupine56.8 56.8 0.4 0.7 2.0 1.7 2.5 2.5 2.5 2.5 60,0 3 50,0 Triglav