Instabank — Earnings Release 2021

Nov 4, 2021

Instabank doubles profits in 2021

Instabank doubles profits in 2021

Low loan losses and strong growth resulted in a record high profit for Instabank in the third quarter. So far in 2021, profits have more than doubled compared to last year.

Instabank achieved a pre-tax profit of NOK 32.5 million (NOK 24.4 million after tax) in the third quarter. This is 85 per cent higher than same quarter last year. The increase is primarily due to solid growth in lending, leading to economies of scale, and low loan losses.

- The organisation delivers on the strategy to become a more diversified bank with lower risk and thus lower losses. The quarter saw only a minor increase in unsecured loans, and one third of loans in Norway are now mortgages. A very marginal share of mortgages is in default, and overall the bank's losses on loans are well within the targets set by the board," says Robert Berg, CEO of Instabank.

Refinancing in favour of customers:

Loan growth in the quarter was NOK 298 million, which is distributed across all products and all markets. The strongest growth is in the Norwegian market, which now accounts for 64 per cent of total loans. The main contributor to growth in net loans is mortgages, which were introduced in the summer of 2020.

- Most of our customers within mortgages are refinancing consumer loans and credit card debt. However, we are not refinancing debt that is in default. This means there is lower risk in our portfolio than for other players in this segment. Also, we do not require customers to gather all their loans in Instabank, as many other banks do. Our customers should be in a better financial position after having been granted a loan from us, than they were before," says Robert Berg.

Instabank achieved 16.6 percent return on equity in the third quarter, which is among the highest in the industry. So far in 2021, the return on equity is 13.6 per cent, which is above the target of 13 per cent for 2021.

- Solid profits allow us to continue to develop the bank towards a more diversified personal bank. We are particularly pleased with the positive developments in loan losses we have seen over a long period. Improved credit quality due to the debt register, an improvement in customers' private finances and the increased share of mortgages, contribute to this, says Berg.

A presentation of the report will be held online on Teams at 13:00, facilitated by Sparebank 1 Markets. For registration, please send an email to corporateaccess@sb1markets.no, and a link to the presentation will be returned.

A physical presentation will also be held at 10:00 in Stavanger at SR Banks offices at Bjergsted Terrasse 1. For registration, please send an email to corporateaccess@sb1markets.no.

Contact persons:

Robert Berg, CEO, robert.berg@instabank.no

Per Kristian Haug, CFO, perkristian.haug@instabank.no

This information is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act