Strong lending growth in a solid quarter for Sparebanken Møre

"National figures show that lending growth is low, and there is tough competition for customers. It is therefore gratifying that we have such strong lending growth in both the retail and corporate markets. This shows that our investment in more offices and advisers who are close to customers is paying off," says Trond Lars Nydal, CEO of Sparebanken Møre.

The strong quarterly growth contributed to an increase in profit after tax of 18 per cent compared with the second quarter last year, and the result ended at NOK 301 million. This gives a return on equity for Q2 of 15.1 per cent, compared with 13.6 per cent for the same quarter in 2023. Costs for the quarter are 41 percent of revenues, which is 2.1 p.e. up from last year. The increase is partly a result of investments in growth, which have contributed to increased revenues.

At the end of the first half of the year, the CET1 capital ratio ended at 19.1 per cent, up from 17.6 per cent compared to the same time in 2023.

"The bank's capital situation is solid and we are well equipped for continued growth, to cope with future risk, and we have good dividend capacity," says Nydal.

Good activity level and low losses
The increase in lending is a result of high activity in Northwest Norway and Oslo, and is a good confirmation that the bank is competitive and attractive to new customers as well. The bank's experience is that more people want a permanent adviser and personal advice.

"In April, we won the national Customer Service Award for the banking industry for the sixth year in a row. It is inspiring to receive such recognition from customers. In addition, it is motivating to see that we are growing well in the retail market both in Northwest Norway and in Oslo. We are also experiencing good activity in the region and are growing well in the business market. Going forward in the autumn, we have clear ambitions to increase our market share further," says Nydal.

Close follow-up and good advice provide security for customers and the bank, and also contribute to low losses. In the second quarter, the bank recognised a net income of NOK 35 million of previous loss provisions.

Stable outlook for Northwest Norway
The Norwegian krone has depreciated again through summer, and the depreciation must be seen in the light of increased concerns about an economic downturn in the US and turbulence in international financial markets.
Many industries in Northwest Norway are benefiting from a weak krone exchange rate, and figures from Norges Bank's Regional Network report confirm that economic development is expected in Northwest Norway than in most other regions in the country.

Advance notice of an order from Finanstilsynet
At the beginning of July, the bank received a preliminary notice of an order related to the current practice of recording unpaid gifts for non-profit purposes as other liabilities in the bank's accounts. Sparebanken Møre disagrees with Finanstilsynet's assessments and will review and assess the factual and legal basis for the notified order until the deadline of 26 August.

Reference is also made to the stock exchange announcement dated 5 July 2024.

Key figures – Q2 2024

• Net interest income: NOK 518 million/2.12 per cent (NOK 462 million/1.94 per cent)
• Profit before loss: NOK 359m (NOK 332m)
• Profit after tax: NOK 301 million (NOK 255 million)
• Return on equity: 15.1 per cent (13.6 per cent)
• Cost-to-income ratio: 41.0 per cent (38.9 per cent)
• Profit per equity certificate (Group): NOK 2.85 (NOK 2.46)

Comparable figures for Q2 2023 in brackets.

Key figures – H1 2024

• Net interest income: NOK 1,026 million/2.09 per cent (NOK 907 million/1.96 per cent)
• Profit before loss: NOK 709 million (NOK 634 million)
• Profit after tax: NOK 555 million (NOK 462 million)
• Return on equity: 14.1 per cent (12.2 per cent)
• Cost-to-income ratio: 40.3 per cent (39.3 per cent)
• Profit per equity certificate (group): NOK 5.26 (NOK 4.42)
• CET1 capital: 19.1 per cent (17.6 per cent)
• Growth in lending over the past 12 months: 7.7 per cent (9.3 per cent)
• Growth in deposits over the past 12 months: 6.3 per cent (3.1 per cent)

Comparable figures for the 1st half of 2023 in brackets.

Contact persons
Trond Lars Nydal, CEO, tel. 951 79 977
John Arne Winsnes, CFO, tel. 462 80 999
Trine Kvalheim, Head of Communications, tel. 454 65 680