SpareBank 1 SMN

Earnings Release • May 6, 2022

Solid performance and historic milestone in first quarter

Solid performance and historic milestone in first quarter

SpareBank 1 SMN delivered, despite international turbulence, a profit of NOK 698m after tax in the first quarter of 2022, and topped for the first time a loan volume of NOK 200bn. The bank is more solid than ever and is performing well in all business lines.

Strong international alarm over Russia’s invasion of Ukraine along with global supply chain challenges and high energy and commodity prices have impacted the economic situation in the quarter. However, the Norwegian economy has shown a strong trend after the removal of infection protection measures. At the end of the first quarter the CET1 ratio was 18.3 per cent, and bank incurred no losses in the quarter.

“The Norwegian economy is robust, Mid-Norway is doing well and SpareBank 1 SMN has delivered a strong performance. But this is against a grim backdrop of war and refugees in flight. While we have no direct exposure either to Russia or Ukraine, we devote much time to advising customers affected by sanctions or by other challenges resulting from the international turbulence,” says Group CEO at SpareBank 1 SMN, Jan-Frode Janson.

Continued growth

Overall lending rose by 7.9 per cent and deposits by 11.4 per cent in the last 12 months. In the first quarter Corporate Banking achieved lending growth of 4 per cent compared with 2.6 per cent in the same period last year. Personal Banking also shows continued growth, with a 1.6 per cent increase in lending in the first quarter. The bank topped a historic milestone of NOK 200bn in loans for the first time.

“History shows that we keep a cool head in times of crisis. We are prepared to stand up for people and businesses through this crisis too, just as we did through the pandemic. We do this by being close at hand, by ensuring short decision paths and by showing that we care. We are more solid than ever and are more than ready to take on more customers,” says Mr Janson.

EiendomsMegler 1 Midt-Norge is also delivering good results and has now increased its market share in the region to 37 per cent. SpareBank 1 Regnskapshuset SMN has invested heavily both in competencies and technology and increased its operating revenues to NOK 166m in the first quarter, compared with NOK 155m in the same quarter of the previous year. SpareBank 1 Markets continues to deliver good results, but at a weaker level than in preceding quarters. SpareBank 1 SMN Invest delivered an extraordinarily good profit of NOK 132m, mainly due to upward adjustments to the value of a few companies in the portfolio.

Demandning international conditions

The quarter was marked by several extraordinary events and circumstances that affect the results. SpareBank 1 Gruppen delivered a considerably lower profit than in the same quarter last year. This is largely due to the demanding macroeconomic conditions and, in addition, to substantial disbursements by the insurer Fremtind resulting from a large number of natural damage events.

SpareBank 1 SMN has set aside a minimum of NOK 2m of its community dividend to assist in the humanitarian catastrophe resulting from the war in Ukraine. NOK 1m has already been donated to the large international aid organisations present in and around Ukraine. In addition a programme has been set up to which clubs, associations and other voluntary bodies can apply for support to create activities and facilities for refugees who come to Mid-Norway. Thus far the programme has drawn a good response.

“It is heartwarming to see the tremendous commitment of people and the voluntary sector throughout Mid-Norway to help those hit by the war in Ukraine. Noting the equally large commitment to step up, make welcome and include the refugees that come to our region, we are pleased to be able to support these efforts through our community dividend,” says Group CEO Jan-Frode Janson.

Key figures first quarter 2022:

(Consolidated figures. Figures in parenthesis refer to the same period of 2021 unless otherwise stated)

• Post-tax profit: NOK 698m (768m)

• Return on equity: 12.5% (14.8%)

• CET1 ratio: 18.3% (18.0%)

• Growth in lending: 2.4% (1.4%)

• Growth in deposits: 2.5% (5.0%)

• Losses on loans and guarantees: NOK 0m (59m)

• Earnings per equity certificate: NOK 3.20 (3.40)

Contacts:

CFO Trond Søraas on +47 922 36 803

Executive Vice President Rolf Jarle Brøske on +47 911 12 475

https://quarterlyreport.smn.no/

This information is subject to the disclosure requirements pursuant to Section

5-12 the Norwegian Securities Trading Act