Taaleri (TAALA) investor relations material

Strategic objectives and business focus

• Updated strategy for 2026–2028 centers on growth in three synergistic businesses: credit risk insurance (Garantia), private asset management (renewable energy, bioindustry, real estate), and development capital, leveraging expertise and capital for long-term returns.

• Growth in private asset management will be driven by scaling flagship funds, expanding fund sizes, launching new and parallel strategies, and entering new asset classes, with a focus on renewable energy, bioindustry, and real estate.

• Garantia targets over 10% annual growth in insurance service result, expansion into Nordic and Baltic markets, and increased market share in residential mortgage and corporate guarantees, while maintaining a highly efficient combined ratio.

• Development capital aims for returns on equity exceeding group targets, with capital allocated to opportunities not suitable for existing funds, and a focus on cash flow visibility and direct investments.

• Selective M&A and partnerships are key growth levers, targeting new teams, strategies, geographies, and complementary insurance partnerships.

Market trends and business environment

• Private capital markets in Europe are expected to grow at double-digit rates, with balanced growth across real estate, infrastructure, and private equity asset classes.

• Sustainability and megatrends such as green transition, urbanization, and circular economy are core to the business model, with 88% of products having sustainability objectives.

• The Finnish housing and home loan market is recovering, with lower interest rates boosting home transactions and supporting Garantia's business.

• Regulatory changes in banking collateral requirements and financial sector regulation provide tailwinds for credit risk insurance products.

• Expertise and a multidisciplinary team underpin execution, with a strategy management group established and recent management model updates to support execution.

Financial guidance and targets

• New financial targets for 2026–2028 include a 12% CAGR in operating profit from continuing earnings and a return on equity at fair value above 15% on average, considering comprehensive income.

• Dividend policy remains at a minimum 50% payout of net result, with flexibility to adjust based on capital requirements for growth and M&A.

• Strong balance sheet with over 70% equity ratio and significant liquidity supports organic and inorganic growth initiatives and M&A flexibility.

• Operating profit from continuing earnings is identified as the key value driver, with stable cash flows from Garantia enabling risk-taking in new growth areas.

• Scalability initiatives, including efficiency programs and AI, are expected to keep cost growth below revenue growth.