Nordea Bank Abp Q4 2019 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Sofie Caroline Elisabet Peterzens - JP Morgan Chase & Co, Research Division - Analyst : Here is Sofie from JPMorgan. I just had a question on net interest income. Some of the -- when we look at a divisional level, most of the quarter-on-quarter improvement actually comes from group functions. And also got a new LC and I division and still you always have a higher fourth quarter NII, given that you have some bridge financing and other things. How should we think about kind of NII in the first quarter? Are there any like group functions? Should it remain at the current level of plus EUR 8 million? Or will it change? Or how should we basically think about that going forward? That's my question.

Question: Sofie Caroline Elisabet Peterzens - JP Morgan Chase & Co, Research Division - Analyst : Okay. That's very clear. And then my second question would be on your intangibles. They increased by EUR 100 million in the quarter. Could you just explain what drove the EUR 100 million increase in intangibles this quarter? And could you also confirm that you're not taking any kind of restructuring costs through the balance sheet?

Question: Sofie Caroline Elisabet Peterzens - JP Morgan Chase & Co, Research Division - Analyst : Okay. Yes. Last question, sorry. On the credit quality, you say that it should remain broadly unchanged, that is versus loan losses, that was the previous guidance. How should we think about the kind of loan losses going forward? So when you talk about stable credit quality, should we use the fourth quarter as the base? Or should we use 2019 as a base? Or what would be a good base for kind of stable asset quality?

Question: Sofie Caroline Elisabet Peterzens - JP Morgan Chase & Co, Research Division - Analyst : So you -- basically, you're saying, consensus estimates on loan losses look reasonable, do you?

Question: Martin Leitgeb - Goldman Sachs Group Inc., Research Division - Analyst : First, just a follow-up on the various capital questions. And I was just thinking more broader, I would like to know how you think about capital for the bank on a kind of more medium-term perspective? Do you think, given how the balance sheet is now, that there is the right level of capital you're running the bank at? Or do you see scope for either the capital base you have to underline to that business to be the higher or lower over kind of more medium term, 3, 4, 5 years period? And then secondly, I was just keen to understand, in terms of grow ambitions, and obviously, your comments on how regaining market share, which grow areas are you most excited about at this moment in time? without the prior written consent of Thomson Reuters. 'Thomson Reuters' and the Thomson Reuters logo are registered trademarks of Thomson Reuters and its affiliated companies. FEBRUARY 06, 2020 / 7:00AM, NDASE.ST - Q4 2019 Nordea Bank Abp Earnings Call

Question: Martin Leitgeb - Goldman Sachs Group Inc., Research Division - Analyst : Yes. I was just wondering on capital. So just kind of the medium -- I mean obviously, we're aware of the more immediate moving parts for capital requirements going forward. But I was just trying to understand what your expectation would be for the bank going forward? So would you -- do you see essentially that capital targets, the capital levels you run the bank at will stay broadly similar in terms of -- if you just think about the absolute quantum of core tier 1 capital you run the bank with? Or do you see the upward or downward pressure to that capital requirement base?

Question: Chris Hartley - Redburn (Europe) Limited, Research Division - Analyst : Just a quick 1 for me, actually. Just -- I was looking at your net fair value line and you used to give us a chart in your presentation that split that out between sort of customer activity and then market-making, some derivative valuations, et cetera. I couldn't see that this time around. If I have missed it, do let me know. But if not, are you able to give us a sense of how the EUR 266 million this quarter is split up amongst those categories, please?

Question: Chris Hartley - Redburn (Europe) Limited, Research Division - Analyst : Okay. And there isn't anything significant from the derivative valuations in there, is there? In either direction?