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Group accounts Q1/2012 and YoY 2011
W&W Group – strong first quarter
Dr. Jan Martin Wicke, CFO14 May 2012
Disclaimer
This presentation and the information contained herein, as well as any additional documents and explanations (together the “material“), are issued by Wüstenrot & Württembergische AG (“W&W”).
This presentation contains certain forward-looking statements and forecasts reflecting W&W management’s current views with respect to certain future events. These forward-looking statements include, but are not limited to, all statements other than statements of historical facts, including, without limitation, those regarding W&W’s future financial position and results of operations, strategy, plans, objectives, goals and targets and future developments in the markets where W&W participates or is seeking to participate. The W&W Group’s ability to achieve its projected results is dependent on many factors which are outside management’s control. Actual results may differ materially from (and be more negative than) those projected or implied in the forward-looking statements. Such forward-looking information involves risks and uncertainties that could significantly affect expected results and is based on certain key assumptions. The following important factors could cause the Group’s actual results to differ materially from those projected or implied in any forward-looking statements:
– the impact of regulatory decisions and changes in the regulatory environment;– the impact of political and economic developments in Germany and other countries in which the Group operates;– the impact of fluctuations in currency exchange and interest rates; and– the Group’s ability to achieve the expected return on the investments and capital expenditures it has made in Germany and in foreign countries.
The foregoing factors should not be construed as exhaustive. Due to such uncertainties and risks, readers are cautioned not to place undue reliance on such forward-looking statements as a prediction of actual results. All forward-looking statements included herein are based on information available to W&W as of the date hereof. W&W undertakes no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by applicable law. All subsequent written and oral forward-looking statements attributable to W&W or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements. The material is provided to you for informational purposes only, and W&W is not soliciting any action based upon it. The material is not intended as, shall not be construed as and does not constitute, an offer or solicitation for the purchase or sale of any security or other financial instrument or financial service of W&W or of any other entity. Any offer of securities, other financial instruments or financial services would be made pursuant to offering materials to which prospective investors would be referred. Any information contained in the material does not purport to be complete and is subject to the same qualifications and assumptions, and should be considered by investors only in light of the same warnings, lack of assurances and representations and other precautionary matters, as disclosed in the definitive offering materials. The information herein supersedes any prior versions hereof and will be deemed to be superseded by any subsequent versions, including any offering materials. W&W is not obliged to update or periodically review the material. All information in the material is expressed as at the date indicated in the material and is subject to changes at any time without the necessity of prior notice or other publication of such changes to be given. The material is intended for the information of W&W´s institutional clients only. The information contained in the material should not be relied on by any person.
In the United Kingdom this communication is being issued only to, and is directed only at, intermediate customers and market counterparties for the purposes of the Financial Services Authority’s Rules ("relevant persons"). This communication must not be acted on or relied on by persons who are not relevant persons. To the extent that this communication can be interpreted as relating to any investment or investment activity then such investment or activity is available only to relevant persons and will be engaged in only with relevant persons.
page 2
page 3
Agenda
1. W&W at a glance
2. Financials
Q1/2012 resultsYearly comparison 2012/2011
3. W&W profile
Vision
The world is changing, at an ever-increasing pace. Given the complexity of today's world, many customers are looking for a reliable, long-term partner to satisfy their needs in terms of financial services. We want to be their partner of choice.
Our position in the market is unique: With the two well established strong brands "Wüstenrot" and "Württembergische", the W&W Group is a specialized one-stop shop for financial planning of retail clients and small/medium commercial customers in Germany and the Czech Republic.
W&W at a glance
page 4
Personal services delivered locally by our mobile sales force of about 6,000 tied agents ensure a customer relationship which is characterized by trust, understanding, and reliability.
We offer solutions for each customer's individual needs, throughoutall stages in life, in the areas of
retail banking with focus on banking products and mortgage lending (B), life and health insurance (L/H) property and casualty insurance (P/C).
We deliver clear and systematically defined quality standards. Continuous quality management forms an integral part of our corporate culture.
Six million customers rely on our expertise and financial strength.
Wüstenrot Bausparkasse AG (BSW)
Wüstenrot Bank AG Pfandbriefbank (WBP)
Wüstenrot Bausparkasse AG (BSW)
Wüstenrot Bank AG Pfandbriefbank (WBP)
W&W GroupW&W Group
W&W at a glance
Structure
Württembergische Lebens-versicherung AG
ARA Pensions-kasse AG
Karlsruher Lebens-versicherung AG
Württembergische Kranken-versicherung AG
Württembergische Lebens-versicherung AG
ARA Pensions-kasse AG
Karlsruher Lebens-versicherung AG
Württembergische Kranken-versicherung AG
Württembergische Versicherung AG
Württembergische Versicherung AG
Service entities
Czech W&W companies
Service entities
Czech W&W companies
Property andCasualty Insurance (P/C)
Property andCasualty Insurance (P/C) OthersOthers
page 5
Banking Products andMortgage lending (B)
Banking Products andMortgage lending (B)
Life and HealthInsurance (L/H)Life and HealthInsurance (L/H)
W&W Group is based on several strong pillars
We stay on track with our efficiency programme “W&W 2012“ and focus on profitable growth In a challenging economic environment W&W benefits from its solid business model The new efficiency programme "W&W 2015" ensures our further economic independance
We stay on track with our efficiency programme “W&W 2012“ and focus on profitable growth In a challenging economic environment W&W benefits from its solid business model The new efficiency programme "W&W 2015" ensures our further economic independance
W&W strategyW&W strategy
W&W at a glance
Q1/2012 Highlights
page 6
Business environmentBusiness environment
New businessNew business
Risk assessmentRisk assessment
GuidanceGuidance
Extremely low domestic interest rates are a challenge for providers of financial services Higher capital requirements Increased consumer protection
Extremely low domestic interest rates are a challenge for providers of financial services Higher capital requirements Increased consumer protection
Successful new business of W&W in almost all areas Clear increase in new home loan savings business, 9 % above market level L/H shows clear increase in new business New business in P/C growing significantly in vehicle insurance segment
Successful new business of W&W in almost all areas Clear increase in new home loan savings business, 9 % above market level L/H shows clear increase in new business New business in P/C growing significantly in vehicle insurance segment
PIIGS-exposure further reduced; entire Greek portfolio sold Sound solvability of W&W, equity capital further strengthened W&W is prepared for a further increase in regulation of financial markets
PIIGS-exposure further reduced; entire Greek portfolio sold Sound solvability of W&W, equity capital further strengthened W&W is prepared for a further increase in regulation of financial markets
In 2012 net profit will rise to € 250 mn Sales growth expected in 2012 and 2013 Ongoing period of low interest rates could affect results in the medium term
In 2012 net profit will rise to € 250 mn Sales growth expected in 2012 and 2013 Ongoing period of low interest rates could affect results in the medium term
EarningsEarnings W&W exceeds its profit targets: Q1-profit is € 66.5 mn against a year to day target of € 62.5 mn W&W exceeds its profit targets: Q1-profit is € 66.5 mn against a year to day target of € 62.5 mn
1828 Württembergische founded 1921 Wüstenrot established 1999 Merger of Wüstenrot and
Württembergische into W&W AG 8.497 Fulltime employees 6 mn Customers Multi-channel distribution by own sales force of 6,000
tied agents; 5,000 brokers; online-banking; sales cooperations
1828 Württembergische founded 1921 Wüstenrot established 1999 Merger of Wüstenrot and
Württembergische into W&W AG 8.497 Fulltime employees 6 mn Customers Multi-channel distribution by own sales force of 6,000
tied agents; 5,000 brokers; online-banking; sales cooperations
Sound backgroundSound background
Number of savings contracts (B) 3.8 mn Mortgage loans (Group) 773,616 Life insurance contracts 2.7 mn P/C insurance contracts 8.0 mn Health insurance customers 470,142 Current accounts (B) 283,000 Call deposit accounts (B) 302,000
Number of savings contracts (B) 3.8 mn Mortgage loans (Group) 773,616 Life insurance contracts 2.7 mn P/C insurance contracts 8.0 mn Health insurance customers 470,142 Current accounts (B) 283,000 Call deposit accounts (B) 302,000
Customer base FY 2011Customer base FY 2011
No 2 in home loan savings No 9 in property/casualty insurance No 12 in life insurance
No 2 in home loan savings No 9 in property/casualty insurance No 12 in life insurance
Domestic market positionDomestic market position
W&W at a glance
Master data
Gross premiums (L/H) € 2.4 bn Gross premiums (P/C) € 1.4 bn Building society deposits (B) € 17.6 bn Volume of building savings
contracts (B) € 104.3 bn Mortgage disbursements (B) € 4.4 bn Assets under management (Group) € 27.9 bn
Gross premiums (L/H) € 2.4 bn Gross premiums (P/C) € 1.4 bn Building society deposits (B) € 17.6 bn Volume of building savings
contracts (B) € 104.3 bn Mortgage disbursements (B) € 4.4 bn Assets under management (Group) € 27.9 bn
Business volume FY 2011Business volume FY 2011
page 7
As of: 31 December 2011
New home loan savings, gross (B) € 15.3 bn New home loan savings, net (B) € 11.8 bn Total new mortgages (Group) € 5.9 bn New premiums (P/C) € 206.7 mn Annual Premium Equivalent (L/H) € 240.0 mn
New home loan savings, gross (B) € 15.3 bn New home loan savings, net (B) € 11.8 bn Total new mortgages (Group) € 5.9 bn New premiums (P/C) € 206.7 mn Annual Premium Equivalent (L/H) € 240.0 mn
New businessNew business
Financial result € 1.4 bn Premiums earned € 3.8 bn Insurance benefits incl. paid claims € 3.5 bn Net profit € 191.6 mn Earnings per share € 1.94
Financial result € 1.4 bn Premiums earned € 3.8 bn Insurance benefits incl. paid claims € 3.5 bn Net profit € 191.6 mn Earnings per share € 1.94
Income statementIncome statement
Total assets € 75.4 bn Investments € 43.5 bn Retail mortgages € 27.4 bn Insurance liabilities € 29.7 bn Customer savings € 27.0 bn Equity € 3.0 bn
Total assets € 75.4 bn Investments € 43.5 bn Retail mortgages € 27.4 bn Insurance liabilities € 29.7 bn Customer savings € 27.0 bn Equity € 3.0 bn
Balance sheetBalance sheet
W&W has set the following profit target:
In 2012 net profit will rise to € 250 mn
W&W has set the following profit target:
In 2012 net profit will rise to € 250 mn
Profit targetProfit target
W&W at a glance
Key figures 2011
page 8
Solvency ratios Solvency ratios Risk profileRisk profile
Ratings*Ratings*
Wüstenrot Holding 66.10 % LBBW 8.78 % UniCredito 7.54 % L-Bank 4.99 % Schweizerische Rück 4.67 % Free float 7.92 %
Wüstenrot Holding 66.10 % LBBW 8.78 % UniCredito 7.54 % L-Bank 4.99 % Schweizerische Rück 4.67 % Free float 7.92 %
Shareholders of W&W AGShareholders of W&W AG
W&W at a glance
Key figures 2011
page 9
Distribution of required capital as of 31 December:
As of: 31 December 2011
5% 2%
12%
32%
49%
Operational risk
Collective risk
Insurance risk
Market risk
Credit risk
* Ratings as of 20 December 2011. For more details concerning W&W ratings see page 34.
BBB+ outlook positiveBBB+ outlook stableWürttembergische Lebensversicherung
BBB+ outlook positive —Württembergische Krankenversicherung
BBB+ outlook positiveBBB+ outlook stableWüstenrot Bank AG Pfandbriefbank
BBB+ outlook positiveBBB+ outlook stableWüstenrot Bausparkasse
AAACovered Bonds/Pfandbriefe Wüstenrot Bank
FitchS&PIssuer Credit / Default Ratings
—
337 %192 %Risk-bearing capacity via internal model(VaR 99,5), (solvency/economic capital ratio)
9.5 %10.1 %Total capital ratio (WBP)
11.0 % 9.9 %Total capital ratio (BSW)
246 %236 %Insurance Group
133 %129 %W&W financial conglomerate
20102011
Business segments Q1/2012Financials
page 10
Banking products and Mortgage lending
Life and Health Insurance Property / Casualty Insurance Other Segments Consolidation / Reconciliation Group
€000's1.1.2012 to
31.3.20121.1.2011 to
31.3.20111.1.2012 to
31.3.20121.1.2011 to
31.3.20111.1.2012 to
31.3.20121.1.2011 to
31.3.20111.1.2012 to
31.3.20121.1.2011 to
31.3.20111.1.2012 to
31.3.20121.1.2011 to
31.3.20111.1.2012 to
31.3.20121.1.2011 to
31.3.2011
7. Net financial result 143 257 138 670 443 452 312 561 9 940 8 420 118 647 56 138 - 106 481 - 46 821 608 815 468 968
9. Net fee and commission result - 2 280 - 8 066 - 38 936 - 34 044 - 43 925 - 42 107 - 11 151 - 7 348 2 913 2 884 - 93 379 - 88 681
10. Net premiums earned 0 0 614 651 596 945 293 338 274 323 60 658 57 355 - 9 231 - 7 585 959 416 921 038
11. Insurance benefits to customers 0 0 917 075 787 322 156 453 137 935 42 867 36 052 - 11 082 - 1 680 1 105 313 959 629
12. General administrative expenses 104 475 109 003 61 323 62 193 83 194 78 848 25 159 18 582 6 646 5 640 280 797 274 266
13. Others 7 340 4 849 - 23 629 - 19 704 6 746 3 660 7 093 610 4 150 10 658 1 700 73
14. Earnings before taxes 43 842 26 450 23 996 12 747 27 124 28 041 107 270 52 455 - 103 584 - 44 841 98 648 74 852
15. Taxes 13 449 8 380 7 621 3 542 10 095 8 055 18 152 12 517 - 17 123 - 11 238 32 194 21 256
16. Net profit after taxes 30 393 18 070 16 375 9 205 17 029 19 986 89 118 39 938 - 86 461 - 33 603 66 454 53 596
page 11
Agenda
1. W&W at a glance
2. Financials
Q1/2012 results
Yearly comparison 2012/2011
3. W&W profile
Building societyBuilding society Life/HealthLife/Health
Financials
Main figures of the segments Q1/2012
page 12
P/CP/CBankingBanking
∆Q1 2011Q1 2012
- 1.5%€ 2.73 bn€ 2.69 bnNew home loan savings, net
+ 3.5%€ 3.70 bn€ 3.83 bnNew home loan savings, gross
∆3M 2011Q1 2012
- 13.4%€ 1.5 bn€ 1.3 bnTotal new mortgages (W&W group)
- 8.4%€ 987 mn€ 904 mnNew mortgages
∆Q1 2011Q1 2012
+ 8.3%€ 638mn€ 690 mnGross premiums
€ 76.1 mn€ 103.6 mnNew premiums
∆Q1 2011Q1 2012
+ 1.8 %€ 612 mn€ 623 mnGross premiums
+ 6.3%
+ 5.7%
+ 9.7%
€ 164 mn
€ 127 mn
€ 32 mn
€ 174 mn
€ 134 mn
€ 35 mn
Total new premiums
Single premiums
Regular premiums
+ 36.1%
page 13
Agenda
1. W&W at a glance
2. Financials
Q1/2012 results
Yearly comparison 2011/2010
3. W&W profile
Business segments yearly comparison 2011/2010Financials
page 14
Segment Income Statement
Banking products and Mortgage lending
Life and Health InsuranceProperty / Casualty
InsuranceOther Segments
Consolidation / Reconciliation
Group
€000's1.1.2011 to 31.12.2011
1.1.2010 to 31.12.2010
1.1.2011 to 31.12.2011
1.1.2010 to 31.12.2010
1.1.2011 to 31.12.2011
1.1.2010 to 31.12.2010
1.1.2011 to 31.12.2011
1.1.2010 to 31.12.2010
1.1.2011 to 31.12.2011
1.1.2010 to 31.12.2010
1.1.2011 to 31.12.2011
1.1.2010 to 31.12.2010
7. Net financial result 435 711 407 680 837 036 1 180 689 83 233 63 918 152 094 159 692 - 116 240 - 140 375 1 391 834 1 671 604
9. Net fee and commission result - 23 835 - 22 156 - 158 226 - 139 320 - 177 446 - 174 314 - 43 079 - 20 384 2 064 1 461 - 400 522 - 354 713
10. Net premiums earned 0 0 2 407 829 2 531 585 1 124 650 1 082 445 235 325 217 962 - 17 291 - 50 034 3 750 513 3 781 958
11. Insurance benefits to customers 0 0 2 760 934 3 248 816 574 595 597 891 145 678 150 952 - 19 049 - 55 383 3 462 158 3 942 276
12. General administrative expenses 426 121 402 923 292 139 287 894 340 467 337 893 100 249 101 055 3 963 7 604 1 162 939 1 137 369
13. Others 12 608 126 918 - 2 298 - 6 070 13 143 11 805 24 710 27 386 2 149 8 059 75 463 195 431
14. Earnings before taxes - 1 637 109 519 52 502 54 487 130 867 50 556 123 985 133 372 - 113 526 - 133 299 192 191 214 635
15. Taxes - 22 460 - 19 12 322 13 918 23 371 24 169 26 652 19 844 - 39 289 - 23 026 596 34 886
16. Net profit after taxes 20 823 109 538 40 180 40 569 107 496 26 387 97 333 113 528 - 74 237 - 110 273 191 595 179 749
191,6179,7222,1
67,1
209,5
0
50
100
150
200
250
2007 2008 2009 2010 2011
Financials
Key figures of the W&W Group (1)2011/2010, German market2011/2010, German market
Growth in all segments except for life Profit (€ 191.6 mn) exceeds target of € 180 mn
significantly despite debt crisis in the market Acquisition of Allianz Dresdner strenghtens sales force;
integration in line Write down of Greek bonds significantly impact financial
result (€ 69,9 mn) Positive one-offs in taxes (€ 53 mn net profit)
Growth in all segments except for life Profit (€ 191.6 mn) exceeds target of € 180 mn
significantly despite debt crisis in the market Acquisition of Allianz Dresdner strenghtens sales force;
integration in line Write down of Greek bonds significantly impact financial
result (€ 69,9 mn) Positive one-offs in taxes (€ 53 mn net profit)
Group net profit in € mnGroup net profit in € mn
CommentsComments
Home loan savings contracts (B) € 104.3 (vs.103.4) bn Savings (B) € 17.6 (vs.17.7) bn Gross premiums (L/H) € 2.4 (vs. 2.5)
bn Gross premiums (P/C) € 1.38 (vs.1.32)
bn Assets u. Management (Group) € 27.9 (vs. 27.7) bn
Home loan savings contracts (B) € 104.3 (vs.103.4) bn Savings (B) € 17.6 (vs.17.7) bn Gross premiums (L/H) € 2.4 (vs. 2.5)
bn Gross premiums (P/C) € 1.38 (vs.1.32)
bn Assets u. Management (Group) € 27.9 (vs. 27.7) bn
page 15
Czech companiesCzech companies
Due to reduced government premiums on building society contracts, new business declined by 9 %
Significant growth in mortgage business. Market share is 4.6 % (vs. 3.6 %)
Czech life insurance business decreased by 28 % due to market induced lower single premiums
P/C is on previous year level
Financials
Key figures of W&W Group (2)
Improvement of mortgage loan processing
Transformation of life business
Cost efficiency improvements
Value based management of new business
Improvement of mortgage loan processing
Transformation of life business
Cost efficiency improvements
Value based management of new business
5 years‘ view 5 years‘ view
page 16
Management prioritiesManagement priorities
IFRS 2007 2008 2009 2010 2011
Equity bn € 2,5 2,3 2,6 2,8 1 3,0
Total assets bn € 68,1 64,4 69,5 76,0 1 75,4
Mortgages bn € 25,3 24,6 25,4 27,3 27,4
Investments bn € 34,0 31,1 34,4 44,3 43,5
Premiums earned bn € 3,8 3,7 3,8 3,8 3,8
Net asset value per share € 24,54 25,63 28,71 29,47 1 32,18
Earnings per share € 2,32 0,69 2,40 1,79 1 1,94
Exceeded
2012: tba€ 250 mn net profit
2011: € 191.6 mn€ 180 mn net profit
Exceeded due to „W&W 2009 „ efficiency programme2010: € 179.7 mn€ 140 mn net profit
2008: ROE 2.8 %
ROE 9 %
EvaluationNet profitTarget on previous year basis
Achieved
TargetsTargets
ROE 6,7 %
2009: ROE 9.1 %
Not achieved dueto financial crisis
1 Adjustment of previous year according to IAS 8
109,5112,6
29 20,8
0
20
40
60
80
100
120
2008 2009* 2010 2011
Financials
Key figures banking products and mortgage lending (1)
New business growth based on enhanced multi channel distribution
Increasing new business for the fifth year in a row
New business in mortgages slightly declined due to intensified focus on profitability
Net profit declined notably from € 109.5 to € 20.8 due to Greek bond impairments (€ 64,2 mn loss after tax) and enduring period of low interest rates
New business growth based on enhanced multi channel distribution
Increasing new business for the fifth year in a row
New business in mortgages slightly declined due to intensified focus on profitability
Net profit declined notably from € 109.5 to € 20.8 due to Greek bond impairments (€ 64,2 mn loss after tax) and enduring period of low interest rates
New business 2011/2010New business 2011/2010
Net profit in € mnNet profit in € mn
CommentsComments
New home loan savings, gross+ 4.4 % to € 15.3 bn
and net + 3.4 % to € 11.8 bn
New mortgages (B) € 3.9 bn (- 6.2 %)
New home loan savings, gross+ 4.4 % to € 15.3 bn
and net + 3.4 % to € 11.8 bn
New mortgages (B) € 3.9 bn (- 6.2 %)
page 17
* Since 2009, building society and retail banking form one segment „banking products and mortgage lending“. Previous years are not comparable.
Financials
Key figures banking products and mortgage lending (2)
Improvement of mortgage loan processing
Technical integration Allianz Dresdner Bauspar
Cost efficiency improvements
Value based management of new business
Improvement of mortgage loan processing
Technical integration Allianz Dresdner Bauspar
Cost efficiency improvements
Value based management of new business
5 years‘ view 5 years‘ view
Management prioritiesManagement priorities
page 18
TargetsTargets
IFRS 2007 2008 2009 2010 2011
Customer deposits (BSW) bn € 13,7 12,3 14,2 17,8 17,6
Building societies' guarantee fund (BSW) mn € 261,0 261,0 296,0 356,0 356,0
Allocations (BSW) bn € 4,9 5,8 4,6 5,1 5,4
Loans disbursed for building purposes (BSW) bn € 3,2 4,2 4,0 4,9 4,4
New mortgages (WBP) bn € 1,8 1,8 1,2 1,3 1,4
New bonds (Pfandbriefe) (WBP) bn € 1,3 1,6 0,8 0,3 0,6
2012: tbaNet profit 2012 with € 80-100 mn significantly above level of 2011
In line with forecast due to impairments on Greek bonds
2011: € 20.8 mnNet profit clearly below previous year
In line with forecast2010: € 109.5 mnLess net profit due to investments in W&W 2012
Achieved2009: € 112.6 mnNet profit will rise
Achieved2008: € 29 mnNet profit in home loan saving will clearly increaseStabilisation of net profit in banking expected *
EvaluationNet profitTarget on previous year basis
* Since 2009, building society and retail banking form one segment „banking products and mortgage lending“. Previous years are not comparable.
40,6
16,713,418,8
40,2
0
5
10
15
20
25
30
35
40
45
2007 2008 2009 2010 2011
Financials
Key figures life and health insurance (1)
Premium development impacted by significantly reduced single premiums business
Product mix changed in line with value targets (significantly higher unit-linked new business)
Net profit clearly above target and almost on previous
year‘s level despite critical market environment
Greek bond impairments impact business segment with € 5,7 mn after tax
Premium development impacted by significantly reduced single premiums business
Product mix changed in line with value targets (significantly higher unit-linked new business)
Net profit clearly above target and almost on previous
year‘s level despite critical market environment
Greek bond impairments impact business segment with € 5,7 mn after tax
New business 2011/2010New business 2011/2010
Net profit in € mnNet profit in € mn
CommentsComments
Total new premiums (L/H) € 734.9 mn (- 12.8 %) Single premiums € 549.9 mn (- 18.1 %) Regular premiums € 167.5 mn (+ 8.3 %)
New business (Health only) € 17.5 mn (+ 6.1 %)
APE (L/H) € 240 mn (+ 0.8 %)
Total new premiums (L/H) € 734.9 mn (- 12.8 %) Single premiums € 549.9 mn (- 18.1 %) Regular premiums € 167.5 mn (+ 8.3 %)
New business (Health only) € 17.5 mn (+ 6.1 %)
APE (L/H) € 240 mn (+ 0.8 %)
page 19
Financials
Key figures life and health insurance (2)
Transformation strategy for life business
Value based management of new business
Cost efficiency improvements
Transformation strategy for life business
Value based management of new business
Cost efficiency improvements
5 years‘ view 5 years‘ view
page 20
Management prioritiesManagement priorities
IFRS 2007 2008 2009 2010 2011
Investments (L) bn € 27,47 26,03 27,19 27,61 27,54
Insurance Liabilities (L) bn € 26,27 25,29 25,85 26,41 26,31
Return on Investments (L) bn € 1,08 0,38 0,92 1,13 0,92
Insurance benefits (L) bn € 3,13 2,20 3,15 3,32 2,79
Administrative expense ratio (L) % 3,1 3,1 3,0 2,7 2,7
Acquisition cost ratio (L) % 6,1 6,1 6,5 6,2 5,5
Gross premiums (L) bn € 2,41 2,34 2,44 2,55 2,41
Gross premiums (H) bn € 0,85 0,97 0,11 0,12 0,13
TargetsTargets
2012: tba Net profit 2012 at 2011-level: € 30 mn to € 40 mn
2011: € 40.2 mn Net profit 2011: € 29 mn
Achieved2010: € 40.6 mnNet profit above level of 2009
Achieved2009: € 16.7 mnHigher net profit vs. previous year
2008: € 13.4 mnClear improvement of revenues as to 2007: € 18.8 mn
EvaluationNet profitTarget on previous year basis
Not achieved dueto decline in financial result
Exceeded
26,4
81,1
16,1
53,9
107,5
0
20
40
60
80
100
120
2007 2008 2009 2010 2011
Financials
Key figures property and casualty insurance (1)
New business and premium development clearly above market. Growth particularly in motor and SME-lines
Significantly higher profit due to improved technical result (combined ratio in local business 92,7 %)
No Greek bonds in portfolio of P&C segment
New business and premium development clearly above market. Growth particularly in motor and SME-lines
Significantly higher profit due to improved technical result (combined ratio in local business 92,7 %)
No Greek bonds in portfolio of P&C segment
Selected data 2011/2010Selected data 2011/2010
Net profit in € mnNet profit in € mn
CommentsComments
New premiums € 206.7 mn (+ 5.7 %)
Total gross premiums € 1.4 bn (+ 4.2 %) Gross premiums
motor segment € 568.2 mn (+ 7.2 %) Corporate clients € 293.7 mn (+ 5.2 %)
New premiums € 206.7 mn (+ 5.7 %)
Total gross premiums € 1.4 bn (+ 4.2 %) Gross premiums
motor segment € 568.2 mn (+ 7.2 %) Corporate clients € 293.7 mn (+ 5.2 %)
page 21
Financials
Key figures property and casualty insurance (2)
Underwriting disciplin to be continued Multi-channel distribution offers growth
opportunities Cost management
Underwriting disciplin to be continued Multi-channel distribution offers growth
opportunities Cost management
page 22
IFRS 2007 2008 2009 2010 2011
Gross premiums earned bn € 1,47 1,29 1,30 1,32 1,38
Expenses for insurance claims bn € 0,80 0,79 0,68 0,75 0,72
Insurance business expenditure bn € 0,34 0,32 0,30 0,32 0,32
Number of contracts mn € 7,67 7,64 7,70 7,78 7,95
Number of claims covered in € 000's 570 528 526 546 543
Investments bn € 2,49 2,41 2,45 2,35 2,32
Combined Ratio % 97,0 100,1 90,1 96,2 92,7
Management priorities 2011/2012Management priorities 2011/2012TargetsTargets
5 years‘ view 5 years‘ view
Achieved
Achieved
Achieved
Evaluation
2012: Net profit € will be € 80 to 90 mn
2011: € 107.5 mnNet profit above level of 2010
2010: € 26.4 mnLess net profit due to investments in „W&W 2012“ efficiency programme
2009: € 81.8 mn
Higher net profit vs. previous year 2008: € 16.1 mn
Higher net profit vs. previous year
Net profitTarget on previous year basis
Achieved
2012: tba
Balance sheet 2011/2010Financials
page 23
Assets (IFRS) Liabilities (IFRS)
€000's 31 Dec 2011 31 Dec 2010 31 Dec 2011 31 Dec 2010
A. Cash reserve 165 886 171 737 A. Financial liabilities at fair value through profit or loss 862 526 533 918
B. Non-current assets held for sale and disposal 2 929 95 220 B. Liabilities 37 881 462 39 127 743
C. Financial assets at fair value through profit or loss 2 367 610 2 148 108 C. Negative market value of hedges 574 655 397 337
D. Available for sale financial assets 18 733 691 19 489 246 D. Insurance provisions 29 670 522 29 785 764
E. Receivables 49 422 493 49 305 152 E. Other provisions 2 110 246 2 011 254
F. Allowances for credit losses - 213 141 - 230 372 F. Other liabilities 853 948 853 126
G. Positive market value of hedges 278 707 264 464 G. Subordinated capital 436 966 448 631
H. Investment accounted for using the equity method 212 772 212 990 H. Equity 2 969 004 2 832 090
I. Investment property 1 399 664 1 326 611
J. Reinsurers' share in technical provisions 1 353 007 1 750 438
K. Other assets 1 635 711 1 456 269
TOTAL ASSETS 75 359 329 75 989 863 TOTAL EQUITY AND LIABILITIES 75 359 329 75 989 863
Balance sheet details (W&W Group)
58%
36%
6%
Investments Retail mortgages Others
Assets4%
1%
38%
36%
1%
20%
EquityHybrid capitalInsurance liabilitiesLiabilities to customers (savings)Provison for premium refunds (RfB)Others
Equity and Liabilities
page 24
Financials
Assets are dominated by investments and retail mortgages; Liabilities are dominated by insurance liabilities and liabilities to customers. Over all business segments W&W Group has a comfortable liquidity position.
Solvency ratios
page 25
Financials
Sound capitalization of W&W Group
Available funds according to VAG/KWG
Requirements according to VAG/KWG
Percentage
2012 2011 2012 2011 2012 2011
€mn €mn €mn €mn in % in %
Wüstenrot & Württembergische AG1) 1 763,2 1 732,6 38,4 40,3 4 593,0 4 304,1
Wüstenrot Bausparkasse AG2) 806,8 773,5 8 183,0 7 030,1 9,9 11,0
Wüstenrot Bank AG Pfandbriefbank2) 563,0 543,5 5 563,7 5 700,4 10,1 9,5
Württembergische Versicherung AG1) 325,7 325,6 195,3 190,3 166,8 171,1
Württembergische Lebensversicherung AG1) 1 621,5 1 711,4 1 037,3 998,6 156,3 171,4
Württembergische Krankenversicherung AG1) 17,8 15,8 9,3 8,6 192,7 183,7
1 Requirement of 100,0 %
2 Requirement of 8,0 %
Investments
Investments of the W&W Group as of 31 December 2011 amount to € 43.5 (vs 44.3) bn
page 26
Financials
As a matter of principle, the Group monitors all exposures continuously
5%
44%
33%
3%
14%1%
<1%
<1%
Derivatives, fund-based lifeinsurances
Fixed income securities, shares andinvestments
Other loans
At equity investments
Real estate
Non-current assets held for sale anddiscontinued operations
Municipal loans
Financial Assets reclassified out ofavailable-for-sale-category to theloans and receivables category
PIIGS-Exposure of the W&W GroupFinancials
page 27
Exposure in PIIGS-countries has been further reduced No more Greek bonds in stock
Exposure as of 31 March 2012
Nominal value Book value/Fair value
€ mn 31 March 2011 31 March 2010 31 Dec 2011 31 Dec 2010
Italy 484,8 882,4 408,4 861,3
Spain 142,0 277,0 120,5 245,9
Greece 208,9 284,0 50,1 212,9
Portugal 58,8 87,0 31,4 74,8
Ireland 37,0 62,5 31,4 49,7
PIIGS-Exposure of the W&W GroupFinancials
page 28
Duration 31 Dec 2011
€ mn 0 to 6 month 6 to 12 month 1 to 3 years 3 to 5 years more than 5 years
Italy 2,5 482,3
Spain 5,0 137,0
Greece 15,4 28,0 30,0 135,5
Portugal 5,0 53,8
Ireland 15,0 22,0
page 29
Agenda
1. W&W at a glance
2. Financials
Q1/2012 results
Year on year 2011/2010
3. W&W profile
A short history of W&WProfile
page 30
1828 1991 20121921
Established in 1828, Württembergische Privat-Feuer-Versicherungsgesellschaft is the first private property insurance in southern Germany
Established in 1921, Wüstenrot is Germany‘s first
home loan and savings bank
1999 Merger of Wüstenrot and Württembergische into „W&W AG“
2006 Start of fundamental restructuring of the Group and launch of "W&W 2009" modernization programme, followed by "W&W 2012" efficiency programme aiming at net profit of € 250 mn in 2012
2010 Acquisition of Allianz Dresdner Bauspar AG
2009 Acquisition of Vereinsbank Victoria Bauspar AG
2005 Acquisition of Karlsruher Versicherungsgruppe
2001 Merger of Wüstenrot and Leonberger Bausparkasse AG
In 1833 Allgemeine Rentenanstalt, the first pension insurance in Germany, was established
1991 Cooperation of Allgemeine Rentenanstalt and WürttFeuer; names change to Württembergische Versicherung AG and Württembergische Lebensversicherung AG
Multi-channel distribution
1) Direct sales, supporting the mobile sales force through mailshots, call centres, online transactions
Profile
MobSF Württ
MobSF Würo
Brokers Banks / coop. partners
Direct1 Other
~ 3,000 ~ 3,000 @
Potential access to 40 million customers
Partnerships and cooperations
Banks
Insurance companies
Financial sales networks
Brokers 5,000 brokers
Cooperations
page 31
Cross Selling potential of W&W
Seite 32
2009
2012
15%
10%
Status quo 2010: 10% are customers of both segments (acquired by own salesforce)
Banking products and home financing
InsuranceDivision
Target: 15% are customers of both segments(acquired by own salesforce)
InsuranceDivision
Target: Up 15 % = 720.000 customers in 2012
10%
Profile
Banking products and home financing
page 33
Market sharesProfile
Banking Products and Home Financing
1. Schwäbisch Hall 28.3 %
2. Wüstenrot 13.7 %3. BHW 11.6 %
WüstenrotBausparkasse AG (BSW)
Insurance Division
New home loan savings business (gross) 2011 (private sector)
Wüstenrot Bank 2.9 %Wüstenrot Bank AG Pfandbriefbank (WBP)
New home financing business 2011
1. Allianz 15.0 %
2. AXA 5.3 %
---
9. Württembergische Versicherung 2.3 %
WürttembergischeVersicherung AG
Gross premiums 2010 *
1. Allianz Leben 17.4 %
2. R&V 5.4 %...
12. Württembergische Lebensvers. 2.5 %
Württembergische Lebens-versicherung AG
Gross premiums 2011
Market share
Market share
* 2011 data will be published by Juli 2012
RatingsProfile
page 34
In addition, Wüstenrot Bausparkasse AG is rated "A", outlook: stableby GBB-Rating Gesellschaft für Bonitätsbeurteilung mbH
Württembergische Lebensversicherung AG
Württembergische Krankenversicherung AG
Wüstenrot Bausparkasse AG
Wüstenrot & Württembergische AG
Württembergische Versicherung AG
Wüstenrot Bank AG Pfandbriefbank
Covered Bonds / Pfandbriefe (B)
Hybrid capital bond (P/C)
Hybrid capital bond (L)
Standard & Poor‘s FitchRatings
BBB+outlook positive
BBB+ outlook positive
BBB+ outlook positive
BBB+ outlook positive
Issuer Default Rating
BBB+outlook positive
BBB+outlook positive
AAA
A- outlook positive
BBB+ outlook stable
BBB+ outlook stable
A- outlook positive
BBB+outlook stable
BBBoutlook stable
BBBoutlook stable
Financial Strength Rating
Issuer Credit RatingFinancial Strength Rating
BBB+ outlook stable
A- outlook positive
BBB+ outlook stable
BBB+ outlook stable
Hybrid capital bond : BBB-
Hybrid capital bond: BBB- Hybrid capital bond: BBB-
* Ratings as of 20 December 2011.
Shareholder structure of W&W AG Issued capital of W&W AG is € 481,067,777.39. It is divided into 91,992,622 no-par value shares.
Pro-rata issued capital per share amounts to € 5.23
All W&W shares are registered shares.
Profile
page 35
4,67%
8.79%
7.54%
4.99%
7.91%
66.10%
Wüstenrot Holding LBBWUnicredit LandeskreditbankFree f loat Sw issRe
National International
% of issued capital% of issued capital
Shareholders national/internationalShareholders national/international
6%
94%
97%
3%
Private Institutional
Investor Relations
Wüstenrot & Württembergische AG Gutenbergstraße 30 70176 Stuttgart Investor Relations, Ute Jenschur ir@ww-ag.com internet: ww-ag.com/go/investor-relations (in German) phone: +49 711 662 72 4034
page 36
Profile
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