SpareBank 1 SMN

Earnings Release • Feb 8, 2023

Preliminary annual results for SpareBank 1 SMN: Good growth and strong profit performance

Preliminary annual results for SpareBank 1 SMN: Good growth and strong profit performance

SpareBank 1 SMN delivered a profit of NOK 768m for the fourth quarter. This brings preliminary profit for the full year 2022 to NOK 2,785m after tax. The board of directors recommends a cash dividend of NOK 6.50 per equity certificate, and a community dividend of NOK 474m. The return target is raised to 13 per cent.

The fourth quarter was marked by good growth and improved results in SpareBank 1 Gruppen. Return on equity was 13.1 per cent in the fourth quarter, and 12.3 per cent for the full year. The bank is rock solid with a CET1 ratio of 18.9 per cent.

“Despite turbulent times in the world and uncertainty in the Norwegian economy, Mid-Norway is doing well. Unemployment remains low, and both people and businesses appear to have handled high price growth and interest rate increases in a sound manner. This provides a good basis for SpareBank 1 SMN”, says Group CEO Jan-Frode Janson.

On Thursday 19 January SpareBank 1 SMN reported a hired replacement employee to the police for embezzlement. The Group CEO has focused much of his time on this matter in the run-up to the results presentation.

“The embezzlement has not impacted customers, nor does it affect the bank’s operations or financial situation. The bank is the victim of a serious economic crime and breach of confidence committed by one of our own members of staff. This should never have happened”, says Mr Janson.

SpareBank 1 SMN delivered good growth in lending and deposits alike in 2022, and has now passed NOK 211bn in lending volume. EiendomsMegler 1 Midt-Norge increased its market share to 37 per cent over the course of the year. SpareBank 1 Regnskapshuset SMN expanded its product range beyond traditional accounting services, and has strengthened its position as the leading accounting services provider in Mid-Norway.

“The bank’s focus on the corporate market is reaping results. This applies both to lending growth and other services, and in 2022 the largest share of the profit was generated by services to the corporate segment. Adopting an offensive approach, we are expanding our staff in Trondheim and building a new team in Oslo. The breadth of financial services available under one and the same roof simplifies matters for the customer and makes for more profitable business for the bank”, says Mr Janson.

In November the merger between SpareBank 1 SMN and SpareBank 1 Søre Sunnmøre was approved by the supervisory board and general meeting of each bank. The merger becomes effective at the start of May 2023, and provides a solid basis for an offensive strategy in the region.

Earnings per equity certificate were NOK 12.82. In keeping with the group’s dividend policy, a cash dividend of NOK 6.50 is to be paid to equity certificate holders. The board of directors proposes allocating NOK 474m to community dividend, of which NOK 244m will be transferred to the foundation Sparebankstiftelsen SMN and NOK 230m is for distribution. The regional community has been the bank’s largest owner since its establishment 200 years ago, in May 1823.

“When the region prospers, the bank prospers. And when the bank prospers, the community and the voluntary sector benefit thanks to the community dividend. Over the course of the past four years we have distributed more than one billion kroner to non-profit causes in Mid-Norway”, says Mr Janson.

KEY FIGURES:

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

Preliminary annual accounts for 2022:

• Profit after tax: NOK 2,785m (2,902m)

• Return on equity: 12.3% (13.5%)

• CET1 ratio: 18.9% (18.0%)

• Growth in lending: 8.1% (6.9%)

• Growth in deposits: 9.6% (14.1%)

• Losses on loans and guarantees: NOK 19m (32m)

• Earnings per equity certificate: NOK 12.82 (13.31)

• Proposed cash dividend: NOK 6.50 (7.50)

• Proposed community dividend: NOK 474m

Contact:

For investors:

CFO Trond Søraas on +47 922 36 803

For the media:

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