Sparebanken Møre

Investor Presentation • Apr 25, 2024

Presentation Sparebanken Møre Group 1st quarter 2024

1

Trond Lars Nydal CEO

John Arne Winsnes CFO

25 April 2024 Ålesund

Industry and business community with the ability and willingness to adapt to the market

3

We work closely with customers

Specialist environment with in-depth industry expertise, local knowledge and who make local decisions.

It is felt to be valuable and provides predictability for all parties.

Local presence

Skilled local advisers with local knowledge and local relationships are a competitive advantage

27 April

A good start to the year

Continuous good growth rate

Loans: 6.9 % Deposits: 9.0 % (Last 12 months)

Low loan losses

In NOK: 17 million In per cent: 0,07 (loans and guarantees)

Strong liquidity and solidity

Deposit-to-loan ratio: 57,7% LCR: 173 NSFR: 124 CET1: 18.5 % Leverage Ratio: 7.7 %

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The bank delivers a solid quarterly result

117 170 163 207 254 Q1 2020 Q1 2021 Q1 2022 Q1 2023 Q1 2024

Return On Equity

Result per equity certificate in the 1st quarter of 2024 is NOK 2.41 (Group) against NOK 1.96 (Group) in the 1st quarter of 2023

Profit after taxes

• in MNOK

Results

Profit after tax in Q1 2024 compared with Q1 2023

8

1st quarter 2024

A solid quarterly result

Total income

• NOK million

Total Income in the quarter

Total Income in the quarter

• in per cent of Average Assets

Lending growth

Loans

0,000

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

Lending growth retail market - NOK billion and annual growth

Lending growth in the last 12 months: MNOK 2,708

Deposits – retail market

• NOK billion and annual growth

Deposit growth in the last 12 months: MNOK 2,849

Deposits – corporate market

• NOK billion and annual growth

Increase in deposits in the last 12 months: MNOK 1,117

Deposits

Deposits

High deposit-to-loan ratio of 57.7 per cent

Other Income

Customer relateted other income - MNOK

Financial Instruments - MNOK

0,29

14

Expenses

• NOK million

Cost/Income ratio - Annually

Q1 2023Q2 2023Q3 2023Q4 2023Q1 2024

Operating expenses in the quarter

• in per cent of Average Assets

Losses and portfolio quality

Losses on loans and guarantees

34

Q1-23 Q2-23 Q3-23 Q4-23 Q1-24

-117

17

• NOK million

33

-3

Losses on loans and guarantees - in per cent of Average Assets

Impairments

Credit-impaired commitments (net) - in per cent of loans and guarantees

Corporate lending

• The bank has a stable share of exposure to the corporate sector
• There is good industry risk diversification
• Low level of risk in the portfolio
• Increased lending by NOK 1.0 billion in the first quarter within the maritime and the seafood sectors

Loans by sector

Exposure to Commercial Real Estate (CRE)

• Stable and well-diversified property portfolio
• 73 per cent of the portfolio within our county Møre and Romsdal, offices and hotel properties in Oslo make up 21 per cent
• 95 per cent of the portfolio is in the low and medium risk category

Good quality in our retail portfolio

• Risk in the portfolio is low with 96 per cent of the loans within 85 per cent LTV
• The level of default is lower than in the industry in general
• Reduction in the number of payment holidays and changes in term payments
• Deviation from The Lending Regulation is reduced

Loans to retail customers Loan-to-Value – retail loans

• Deviation from The Lending Regulation reported in Q1- 2024:

65.7

• o 5.3 % outside Oslo (flexibility quota 10 %)
• o 0.9 % in Oslo (flexibility quota 8 %)

• 96 % of mortgages are within 85 % of LTV

House price development Price per square meter

• Norwegian housing prices increased by 1.2 per cent over the last 12 months
• Housing prices in the county of Møre og Romsdal (M&R) increased with 1.3 percent
• The housing market is well functioning and seems resillient to increasing interest rates

Indexed development

• January 2015 = 100

• January 2015 – March 2024

Key information on pre-owned dwellings sold in March 2024	Norway	M & R	Ålesund	City of Oslo
Seasonal adj. development last month	+0.6 %	-1.1 %	-1.0 %	+0.6 %
Development last 12 months	+1.2 %	+1.3 %	+1.0 %	+2.3 %
Development last 10 years	+58.5 %	+35.1 %	+42.4 %	+89.7 %
Per square meter (NOK)	51,381	29,778	35,344	90,831
Average number of days on market	56 days	72 days	68 days	30 days
Price median dwelling (NOK)	3,774,145	2,850,000	3,100,000	5,141,853

Good market access and diversification

Strong rating and long-term financing

57.7 %

• Deposit to loan ratio

A1 • Moody's rating • Stable outlook

38.7 bln.

• Net market financing

Aaa • Covered Bonds

6 bln • Green financing 3.05 year

• Remaining duration Covered Bonds

Strong capital

CET1- status and requirements (per cent)

• Higher predictability with regard to regulatory capital requirements
• The bank has a long-term target for CET1 which must at least be the sum of Pillar 1, Pillar 2 (P2R) and P2G and is thus well capitalized with solid buffers against capital requirements and capital targets
• 2.35 p.p. CET1-buffer relative to the regulatory requirement
• Increased Leverage ratio

MORG pricing

Total Return stronger than the index in Q1 2024

MORG – price and Price/Book (P/B) value*

• Equity, price and P/B

*Equity per MORG is calulated on Group figures. Figures for 2020-2021 stated before the split in 2022.

0,00 0,20 0,40 0,60 0,80 1,00 1,20 1,40 1,60 1,80 2,00

We are driven by improvements

We are continuing to develop the bank Topical issues in Q1

«Næringsteft»

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Promoter of sustainable development From words to action

Climate Environment Social aspects Strong governance

"Sparebanken Møre excels once again and receives the best feedback among the banks measured in relation to sustainability. Over a long time, they have had a clear strategy, good communication and, not least, adviced customers how to work actively with sustainability."

Fredrik Høst, EPSI Norge

Competence and adaptability

• «GrønnArena Møre» - Energy -efficiency in commercial buildings
  • 3-year programme in cooperation with Energiråd
• Competence Ladder
  • 4 different themes - 4 locations in the county
  • In cooperation with the UN Global Compact
  • Competence programme for employees

International development and growth prospects

continue to decline

Global inflationary pressures continue to decline, albeit at a slightly slower pace than before. At the same time, the real economies of a number of western countries appear able to withstand current interest rates better than expected, especially true in the US.

Interest rate cuts will come somewhat later

The fear of reducing interest rates prematurely, and thus helping inflation speed up again, is clear. There is a prospect that the first interest rate cuts will come somewhat later than previously envisaged, and that the interest rate decline will also be more gradual.

Growth prospects in the world economy are relatively subdued. At the same time, the geopolitical situation in Ukraine and the Middle East continues to represent a significant risk. The further development can i.a. have an impact on risk appetite in the financial markets and commodity prices.

High level of activity in Norway and Møre og Romsdal

The level of activity in the Norwegian economy is still high, and unemployment is low. However, the interest rate hikes behind us contribute to the economy continuing to cool down. At the same time, there is a large gap between developments in the various industries.

In Møre and Romsdal, unemployment remains at lower levels than the national average, with 1.8 per cent registered unemployment as of March. This is linked to a relatively high proportion of industry and export-oriented industries.

There are prospects for high wage growth and an increase in household purchasing power this year. This will help to keep the level of activity in the Norwegian economy up. At the same time, we see that housing price developments are stronger than expected, and the NOK exchange rate has weakened so far this year.

All these factors point in the direction of the first interest rate cut being pushed further out in time. Market interest rates indicate expectations that the first rate cut will come in December, somewhat later than indicated by Norges Bank's interest rate path.

Well equipped for further growth

Long term financial targets

ROE > 12.0%

C/I < 40 %

Healthy financial structure

Low losses

Dividend policy

• Sparebanken Møre aims to achieve financial results providing a good and stable return on the bank's equity capital
• Sparebanken Møre's profit allocation must ensure that all equity owners are guaranteed equal treatment
• If the solvency ratio does not indicate otherwise, the aim is that around 50 per cent of the year's profit overall can be distributed as dividends

Contact

sbm.no facebook.com/sbm.no @sbmno engasjert.sbm.no

CEO Trond Lars Nydal

+47 95 17 99 77 trond.nydal@sbm.no

Disclaimer

R

This presentation has been prepared solely for promotion purposes of Sparebanken Møre. The presentation is intended as general information and should not be construed as an offer to sell or issue financial instruments.

The presentation shall not be reproduced. redistributed. in whole or in part. without the consent and Sparebanken Møre. Sparebanken Møre assumes no liability for any direct or indirect losses or expenses arising from an understanding of and/or use of the presentation. of Sparebanken Møre.

CFO John Arne Winsnes

+47 46 28 09 99 jaw@sbm.no

Runar Sandanger Senior Economist SVP

+47 95 04 36 60 runar.sandanger@sbm.no

Attachments

Results Q1 Key figures Q1 24 and Q1 23

MNOK % MNOK % MNOK p.p. Results (NOK million and %) 508 2,07 445 1,98 63 0,09 Net Interest Income 5 0,02 -12 -0,05 17 0,07 Gains/losses liquidity portfolio 0 0,00 5 0,02 -5 -0,02 Gains/losses on shares 11 0,05 7 0,03 4 0,02 Net income Financial Instruments 54 0,22 55 0,24 -1 -0,02 Other Income 70 0,29 55 0,24 15 0,05 Total Other Income 578 2,35 500 2,22 78 0,13 Total Income 124 0,51 111 0,49 13 0,02 Salaries and wages 104 0,42 87 0,39 17 0,03 Other expenses 228 0,93 198 0,88 30 0,05 Total operating expenses 350 1,42 302 1,34 48 0,08 Profit before losses	% 14,2 -141,7 -100,0 57,1 -1,8 27,3
	15,6
	11,7
	19,5
	15,2
	15,9
17 0,07 33 0,15 -16 0,08 Losses on loans and guarantees	-48,5
Pre-tax profit 333 1,35 269 1,19 64 0,16	23,8
79 0,32 62 0,27 17 0,05 Taxes	27,4
Profit after tax 254 1,03 207 0,92 47 0,11	22,7
Return on equity (ROE) % 13,1 11,0 2,1
Cost/Income ratio 39,5 39,7 -0,2
Profit per EC (NOK) 2,41 1,96 0,45	36

Balance sheet and key figures

Key figures per Q1 2024 and Q1 2023

	31.03.24	31.03.23	Changes
Balance in NOK million			MNOK	%
Total Assets	99 372	93 159	6 213	6,7
Loans to customers	83 260	77 867	5 393	6,9
Deposits from customers	48 191	44 225	3 966	9,0
Net Equity and Subordinated Loans	8 676	8 020	656	8,2

Key Figures	31.03.24	31.03.23	Changes p.p.
Return on Equity	13,1	11,0	2,1
Cost/Income Ratio	39,5	39,7	-0,2
Capital Adequacy Ratio	23,1	22,2	0,9
Tier 1 Capital	20,8	19,5	1,3
CET1	18,5	17,7	0,8
Leverage Ratio	7,7	7,4	0,3
Profit per EC (NOK, the Group)	2,41	1,96	0,44
Profit per EC (NOK, the bank)	3,32	3,10	0,22

Specification of other income

Q1 2024 and Q1 2023

(NOK million)	Q1 2024	Q1 2023	Changes y/y
Guarantee commission	7	7	0
Income from the sale of insurance services (non-life/personal)	7	7	0
Income from the sale of shares in unit trusts/securities	2	3	-1
Income from Discretionary Portfolio Management	13	11	2
Income from payment transfers	21	21	0
Other fees and commission income	6	8	-2
Commission income and income from banking services	56	57	-1
Commission expenses and expenses from banking services	-10	-10	0
Income from real estate brokerage	8	8	0
Other operating income	0	0	0
Total other operating income	8	8	0
Net commission and other operating income	54	55	-1
Interest rate hedging (for customers)	2	2	0
Currency hedging (for customers)	10	10	0
Dividend received	4	0	4
Net gains/losses on shares	-4	5	-9
Net gains/losses on bonds	5	-12	17
Change in value of fixed-rate loans	0	-7	7
Change in value of issued bonds	0	4	-4
Net gains/losses related to buy back of outstanding bonds	-1	-2	1
Net result from financial instruments	16	0	16
Total other income	70	55	15

Specification of expences

Q1 2024 and Q1 2023

(NOK million)	Q1 2024	Q1 2023	Changes y/y
Wages	91	81	10
Pension expenses	8	6	2
Employers' social security contribution and Financial activity tax	19	18	1
Other personnel expenses	6	6	0
Wages. salaries. etc.	124	111	13
Depreciations	13	12	1
Operating expenses own and rented premises	5	5	0
Maintenance of fixed assets	2	2	0
IT-expenses	54	38	16
Marketing expenses	10	9	1
Purchase of external services	8	7	1
Expenses related to postage. telephone. newspapers etc.	2	3	-1
Travel expenses	1	1	0
Capital tax	3	2	1
Other operating expenses	6	8	-2
Total other operating expenses	91	75	16
Total operating expenses	228	198	30

Low level of creditimpaired commitments

Group figures

• in % of total commitments

Retail market

• in % of retail commitments

0,20	0,15	0,30	0,33	0,27
2020	2021	2022	2023	Q1-24

Corporate market - in % of corporate commitments

Corporate market (excl. Oil services/supply) - in % of corporate commitments

Credit-impaired commitments

• The overview shows nonperforming commitments in default above 90 days and other credit-impaired commitments

• in NOK million - in % of commitments

Total credit-impaired commitments Total credit-impaired commitments

Corporate Retail

Corporate Retail Total

Losses by sector Losses on loans and guarantees

• NOK million

Expected credit losses Expected credit losses Expected credit losses

- in NOK million - in % of commitments

• NOK million - In % of Average Assets

Recognized losses Losses on loans and guarantees Losses on loans and guarantees

Development in CET1 Changes in CET1 from 31.12.2023

EC capital in Sparebanken Møre

The largest owners (1-10) of EC capital

EC holder	Number	of ECs
	31.03.24	31.12.23
Sparebankstiftelsen Tingvoll	4.883.133	4.904.584
Spesialfondet Borea Utbytte	2.659.226	2.866.229
Verdipapirfondet Eika egenkapital	2.312.962	2.334.387
Wenaasgruppen	2.100.000	2.100.000
Pareto Aksje Norge	1.957.822	1.896.676
MP Pensjon	1.798.905	1.798.905
Kommunal Landspensjonskasse	1.548.104	1.548.104
Verdipapirfond Nordea Norge Verdi	1.505.120	1.505.120
Wenaas EFTF AS	1.100.000	1.100.000
Beka Holding AS	750.500	750.500
Total 10 largest	20.615.772	20.804.505
Of witch Møre og Romsdal	8.083.133	8.104.584
Of witch Møre og Romsdal in per cent	39,2	40,0

EC capital in Sparebanken Møre

The largest owners (11-20) of EC capital

EC holder	Number	of ECs
	31.03.24	31.12.23
Lapas AS	635.000	627.500
Forsvarets personellservice	459.000	459.000
BKK Pensjonskasse	422.600	422.600
Stiftelsen Kjell Holm	419.750	419.750
Fondsfinans utbytte	400.000	0
Kveval AS	343.995	0
Hjellegjerde Invest AS	300.000	300.000
U Aandahls EFT AS	250.000	250.000
PIBCO AS	229.500	229.500
Borghild Hanna Møller	201.967	201.967
Total 20 largest	24.277.584	23.724.822
Of witch Møre og Romsdal	10.119.350	10.133.301
Of witch Møre og Romsdal in per cent	41,8	42,7