Storebrand ASA — Earnings Release 2015

Oct 28, 2015

Storebrand 3Q 2015

28 October 2015

Odd Arild Grefstad – CEO Lars Aa. Løddesøl – CFO

Highlights 3Q 2015

Group result

Q3 2015

Result before profit sharing and loan losses Net profit sharing and loan losses/Longevity provision

• 8,5 % growth in fee and admin income¹
• Results impacted by weak financial markets during the quarter

17% Insurance written premium growth²

27% Unit Linked premium growth²

67% of longevity strengthening completed

146% Estimated Solvency II ratio³

² Growth figures are 3Q2014-3Q2015.

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Transformation of the business model continues

We work hard to reach our vision: Recommended by our customers

Estimated SII position Storebrand Group

Key takeaways

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• Falling interest rates between Q2 and Q3 o 45bps in Norway and 23bps in Sweden
• Reduced stress on equities o From 42% per Q2 to 36% per Q3
• On track to improve underlying Solvency II ratio with 10% points during 2015

¹The estimated Economic solvency position of Storebrand Life Group is calculated using the current Storebrand implementation of the Solvency II Standard model with the company's interpretation of the suggested transition rules from the NFSA. Output is sensitive to changes in financial markets, development of reserves, changes in assumptions and improvements of the calculation framework in the economic capital model as well as changes in the Solvency II legislation and national interpretation of transition rules.

²Indicative sensitivities after the implementation of Solvency II in 2016. Market movements in 2015 and until the introduction of Solvency II in 2016 will have a smaller effect than stated in the sensitivities because of the mitigating effects of the transition rules.

Fee and administration income shifts from Guaranteed to Savings

Income growth of 8.5% adjusted for business in run-off1

Customer centricity, innovation and efficiency

Growth in Savings and Insurance continues

Competitive retail bank offering

Note: All figures are nominal interest rates p.a. Floating rate of 2,1% represents best interest rate in Storebrand's "BLU40" offering.

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Key figures

12.5%

¹Earnings per share after tax adjusted for amortisation of intangible assets

² Customer buffers in Benco of NOK 2.0 bn not included

³Solidity capital/customer buffers does not include provisions for future longevity reservations

Q3 2015

5.4%

11.1%

% of customer funds²

Q2 2015

12.4%

Storebrand Group

		3Q		01.01 - 30.09
NOK million	2015	2014	2015	2014	Full year 2014
Fee and administration income	1 046	1 045	3 155	3 044	4 160
Risk result life & pensions	40	37	103	157	480
Insurance premiums f.o.a.	894	773	2 708	2 313	3 115
Claims f.o.a.	-697	-564	-2 031	-1 614	-2 226
Operational cost	-755	-732	-2 357	-2 238	-2 446
Financial result	-90	95	68	370	349
Result before profit sharing and loan losses	440	655	1 646	2 032	3 431
Net profit sharing and loan losses	-167	67	-159	348	-8
Provision longevity	-96	-90	-402	-270	-391
Result before amortisation and write-downs	176	632	1 085	2 110	3 032
Amortisation and write-downs of intangible assets	-108	-108	-316	-326	-431
Result before tax	67	524	768	1 783	2 601
Tax	-3	-147	-187	-401	-516
Sold/liquidated business	-0	-0	-0	-1	-1
Profit after tax	64	376	581	1 382	2 085

Storebrand Group

Profit
	3Q		01.01 -	30.09	Full year
NOK million	2015	2014	2015	2014	2014
Fee and administration income	1 046	1 045	3 155	3 044	4 160
Risk result life & pensions	40	37	103	157	480
Insurance premiums f.o.a.	894	773	2 708	2 313	3 115
Claims f.o.a.	-697	-564	-2 031	-1 614	-2 226
Operational cost	-755	-732	-2 357	-2 238	-2 446
Financial result	-90	95	68	370	349
Result before profit sharing and loan losses	440	655	1 646	2 032	3 431
Net profit sharing and loan losses/Provision longevity	-264	-23	-561	78	-399
Profit before amortisation	176	632	1 085	2 110	3 032
Profit per line of business
	3Q		01.01 -	30.09	Full year
NOK million	2015	2014	2015	2014	2014
Savings - non-guaranteed	264	240	720	622	1 091
Insurance	120	135	471	516	675

Guaranteed pension -76 233 37 847 1 074 Other result -133 24 -143 124 193 Profit before amortisation 176 632 1 085 2 110 3 032

Savings (non-guaranteed) - strong results growth

Profit
	3Q			01.01 - 30.09
NOK million	2015	2014	2015	2014	2014
Fee and administration income	646	588	1 902	1 696	2 375
Risk result life & pensions	-5	7	-4	-1	-11
Operational cost	-381	-354	-1 183	-1 075	-1 289
Financial result	0	0	0	0	0
Result before profit sharing and loan losses	261	240	715	620	1 075
Net profit sharing and loan losses	3	-1	5	2	16
Provision longevity	-	-	-	-	-
Result before amortisation	264	240	720	622	1 091

Profit per product line

	3Q		01.01 - 30.09	Full year
NOK million	2015	2014	2015	2014	2014
Unit Linked Storebrand	71	63	163	131	205
Unit Linked SPP	41	32	113	74	99
Asset Management segment	116	87	306	240	513
Retail Banking	36	57	137	177	274
Result before amortisation	264	240	720	622	1 091

Savings (non-guaranteed) - strong growth in UL premiums

¹ Growth figures show development from 3Q 2014 to 3Q 2015. ³ Growth figures show development from 3Q 2014 to 3Q 2015 ² Excluding transfers.

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Insurance - continued P&C growth

		3Q		01.01 - 30.09
NOK million	2015	2014	2015	2014	2014
Insurance premiums f.o.a.	894	773	2 708	2 313	3 115
Claims f.o.a.	-697	-564	-2 031	-1 614	-2 226
Operational cost	-122	-122	-387	-378	-387
Financial result	45	48	181	195	173
Result before amortisation	120	135	471	516	675

Profit per product line

		3Q		01.01 - 30.09	Full year
NOK million	2015	2014	2015	2014	2014
P&C & Individual life 1)	62	89	255	234	340
Health & Group life 2)	41	40	148	112	190
Pension related disability insurance Nordic 3)	18	7	69	169	144
Result before amortisation	120	135	471	516	675

¹ Individual life and disability, property and casualty insurance

² Group life, workers comp and 50% of result in Storebrand Health insurance

³ DC disability risk result Norwegian line of business and disability risk result from SPP

Insurance - strong top line development

¹Combined- and cost ratios adjusted for special items. In 4Q 2014, unadjusted cost ratio was 1% and unadjusted combined ratio was 78%.

² Growth figures show development from 3Q 2014 to 3Q 2015

Guaranteed pension - negative results due to weak financial markets

		3Q		30.09	Full year
NOK million	2015	2014	2015	2014	2014
Fee and administration income	428	471	1 317	1 384	1 842
Risk result life & pensions	20	26	83	152	483
Operational cost	-266	-275	-824	-837	-921
Financial result	-	-	-	-	-
Result before profit sharing and loan losses	182	222	576	699	1 404
Net profit sharing and loan losses	-162	101	-137	418	61
Provision longevity	-96	-90	-402	-270	-391
Result before amortisation	-76	233	37	847	1 074

Profit per product line

		3Q		01.01 - 30.09
NOK million	2015	2014	2015	2014	2014
Defined benefit (fee based)	74	148	241	431	592
Paid-up policies, Norway	-35	-66	-227	-121	-117
Individual life and pension, Norway	2	-	5	-	-
Guaranteed products, Sweden	-117	151	18	537	599
Result before amortisation	-76	233	37	847	1 074

Guaranteed pension - Key figures

	2015
NOK million	3Q	2Q	Change
Market value adjustment reserve	4 352	4 930	-578
Excess value of bonds at amortised cost	11 122	9 695	1 427
Additional statutory reserve	4 479	4 505	-26
Provisions for new mortality tables1	3 833	3 850	-17
Unallocated results	1 905	1 964	-59
Provisions for new mortality tables, shareholders direct contribution	245	180	65
Conditional bonuses Sweden	9 065	9 335	-270
Total	35 001	34 460	541

Comments

• Excess value in bonds at amortised cost increased
• Negative profit sharing result in SPP due to low interest rates and weak equity and credit markets

¹Life insurance reserves ¹⁷

Longevity - 2/3 of reserve strengthening completed

²Buffers that are available to cover the longevity reserve strengthening. Some buffers may not be available if they

belong to contracts without reserve strengthening need or are used to cover interest rate guarantee.

³ Including charge to convert from paid-up policies to paid-up policies with investment choice.

Estimated IFRS result impact from longevity reserve strengthening revised down MNOK 500

Longevity strengthening need - sources of funding

2015 4Q - 2020 4.1 1.1 0.4 2.6 Portfolio return above interest guarantee Risk Equalisation Fund Direct equity contribution 200 200 200 200 2016e 2017e 2018e 2019e 2020e 406 2015 562 Total remaining reserve strengthening (BNOK) Estimated annual IFRS result impact (MNOK) Q4e 160 YTD 402 Estimated direct IFRS result impact reduced from 90MNOK to 65MNOK pr. quarter

Paid up policies is the main challenge in a low interest scenario and under SII…

…But still manageable both short and long term

Expected return paid up polices without use of buffers 2015-2020¹

…including reinvestment due and expected issuance of new paid up polices

• 2015-2020: Longevity reserve strengthening and interest rate guarantee to be covered by expected return, buffers and planned company contribution²
• 2020-2025: Prolonged low interest rate environment will have limited impact on results²

¹Expected return paid up polices, including reinvestment and issuance of new paid up polices, without the use of buffers. Illustration is based on normal risk premiums and interest rate level as of September 30, 2015.

²Based on current interest rates and point estimate based on normal risk premiums. Market shocks could lead to higher use of buffers and reduced results

Other¹ - Financial results affected by increased credit spreads Other

Profit
		3Q		01.01 - 30.09	Full year
NOK million	2015	2014	2015	2014	2014
Fee and administration income	31	57	111	174	233
Risk result life & pensions	25	4	25	6	8
Operational cost	-46	-51	-137	-158	-138
Financial result	-135	48	-115	175	175
Result before profit sharing and loan losses	-125	57	-116	197	278
Net profit sharing and loan losses	-8	-33	-27	-72	-85
Profit before amortisation	-133	24	-143	124	193

Profit per product line

	3Q		01.01 - 30.09		Full year
NOK million	2015	2014	2015	2014	2014
Corporate Banking	-34	-29	-51	-46	-47
BenCo	33	20	60	43	94
Holding company costs and net financial results in company portfolios	-131	33	-152	127	145
Profit before amortisation	-133	24	-143	124	193

¹Figures shown exclude eliminations, except elimination in financial result. For full disclosure on eliminations, see Table 46b in Supplementary Information.

Highlights 3Q 2015

Group result

Q3 2015

Result before profit sharing and loan losses Net profit sharing and loan losses/Longevity provision

• 8,5 % growth in fee and admin income¹
• Results impacted by weak financial markets during the quarter

17% Insurance written premium growth²

27% Unit Linked premium growth²

67% of longevity strengthening completed

146% Estimated Solvency II ratio³

¹ Adjusted for business in run off (corporate banking and public sector) and FX. YTD/YTD

² Growth figures are 3Q2014-3Q2015.

³ Including transitional rules.

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Appendix

Storebrand Life Insurance asset allocation

¹The graph shows the asset allocation for all products with an interest rate guarantee in Storebrand Life Insurance Norwegian operations.

SPP asset allocation

¹The graph shows the asset allocation for all products with an interest rate guarantee in SPP.

Investor Relations contacts

Lars Aa Løddesøl Sigbjørn Birkeland Kjetil R. Krøkje Group CFO Finance Director Head of IR

lars.loddesol@storebrand.no sigbjorn.birkeland@storebrand.no kjetil.r.krokje@storebrand.no

+47 9348 0151 +47 9348 0893 +47 9341 2155