SpareBank 1 SMN

Investor Presentation • Oct 29, 2021

Third quarter 2021

1. October 2021

Kjell Fordal CFO

Good profitability Q3 2021

• Return on equity of 12.4% in Q3 – another strong quarter due to sound operations in the bank and subsidiaries
• Loan losses stabilised at a lower level
• Broad-based and profitable growth within personal and corporate banking. Key policy rate hike strengthens the bank's NII
• Visible presence in finance centres and digitally, with a more efficient distribution, new customer offerings and good cost control
• Dividend of NOK 3.10 to be paid in Q4 2021. A dividend of NOK 4.40 is declared for 2020, of which NOK 3.10 is to be paid on 9. November 2021
• Increased optimism in the Norwegian economy. As the market leader in Mid - Norway SMN has good prospects of achieving growth in the years to come

Return on equity per quarter (%)

2 Third quarter 2021

Q3 2021

Net profit

NOK 675m (519) in Q3 NOK 2 199m (1 528) YTD

Return on equity

12.4% (10.5) in Q3 13.8% (10.4) YTD

CET1 ratio 18.1% (17.6)

Pre-loss result of core business NOK 633m (645) Losses NOK 31m (231)

Lending growth 1.6% (2.5) in Q3 and 7.0% (8.5) YOY

Deposit growth -0.4% (1.2) in Q3 and 15.0% (14.0) YOY

Book value per EC NOK 103.57 (92.73) Earnings per EC NOK 3.22 (2.35)

Mid-Norway has reopened

With events in cities and local communities throughout the region

10,000

Members of the community voiced their opinion: «Help speed up the reopening»

NOK 100 million

Of the community's share of the net profit goes to the voluntary sector, organisations, towns, local communities and business – to reclaim our everyday lives

A three-week

Reopening party in Trondheim, and events across all of Mid-Norway during the autumn

The market in Mid-Norway looks strong

Low unemployment Housing prices

Optimism in business and industry

Source: Industry indicator SMN, 2nd half 2021

High activity in the housing market

Personal Banking

Profit before tax (NOKm)

EM1 RM

National growth through the LOagreement

• LO favør-customers are mostly recruited without physical presence
• Competetive prices for young adults

of the growth in LO favør is from LO-members residing outside Trøndelag and

Lending LO-favør (NOKbn)

Growth and new offerings to corporate segments

Corporate Banking

Profit before tax (NOKm)

Banking + Accounting = More customers and a better customer experience

• Assembles banking, systems and accounting in one place
• Close follow-up with a focus on relationship and customer satisfaction
• Access to the finance centre's range of services
• ERP system gives freedom of choice

-

Broad product range and good return on ownership interests

Ownership interests

Profits after tax (NOKm)

Strong brands

SpareBank 1 Gruppen Alliance collaboration on products under a joint brand

SpareBank 1 Forvaltning ODIN Forvaltning SpareBank 1 Kapitalforvaltning

SpareBank 1 Kreditt

SpareBank 1 Betaling SpareBank 1's holding company for their share of Vipps payment solutions

BN Bank Nationwide bank in the retail and corporate market

Mortgage companies SpareBank 1 Boligkreditt SpareBank 1 Næringskreditt

SMN shows strongest progress in latest standings Growth winner and strengthened attractiveness in retail and corporate segment alike

Retail market

Corporate market

Source: KANTAR, June 2021

¹ Primary bank: The share of respondents that lists the bank as their primary bank ² Preference share: The share of respondents that lists the bank as their preferred choice as a primary bank

Green transition

Support for green transition

Can your business transition to become greener? SINTEF is now making expert assistance available to small and medium-sized businesses to help them turn good ideas into reality

Transition is imperative for success

That is why – in collaboration with SINTEF – SpareBank 1 SMN will contribute with financial support to small and medium-sized businesses in Mid-Norway to digitalise, automate and become more sustainable

NOK 35bn of the loan portfolio qualifies for green bond financing

Goals and key targets

Profitable and solid with reduced losses

Return on equity

Earnings per equity certificate Loan losses in per cent of total lending

Lending growth

Lending growth RM 7.9% (CAGR)

Market growth in mortgages 5.2 per cent (C2) YOY

Good growth in residential mortgages

High business banking lending, growth spread both geographically and across a wide range of customers

Lending growth CM 4.7% (CAGR)

Share of lending, CM and RM

Lending per quarter

Relatively stable growth in retail and corporate markets last quarters

Retail Market

Corporate Market

Lending margins

Norges Bank increased the key policy rate to 0,25 % in september 2021. Repricing of mortgages with effect from mid-November

Increased NIBOR in Q3 weakened margins

Norges Bank has signalled another rate hike in December 21 Lending margins versus 3M NIBOR

Deposit growth

Deposit growth RM 8.7% (CAGR)

Good growth in deposits by retail customers and corporate customers alike. Reduced private consumption has brought increased deposits from retail customers from 2020,

High growth in deposits by corporates, both from public sector customers and private businesses

Deposit-to-loan ratio 57 per cent (53 per cent)

Deposit growth CM 12.1% (CAGR)

Share of deposits, CM and RM

Deposits per quarter

Reduced deposits in the retail segment in Q3. Seeing signs of an increase in consumption

Corporate deposits slightly down after a very strong Q2

Retail Market Corporate Market

Deposit margins

Increased NIBOR in Q3 strengthened deposit margins in the quarter

Robust income platform

Net interest income and other income Commission income

Commission income Boligkreditt and Næringskreditt

Net interest income

mill NOK	Q3 21	Q2 21	Q1 21	Q4 20	Q3 20
transmission income Payment	61	56	49	56	54
Credit cards	1 4	3 1	1 4	1 4	1 5
Commissions savings and asset mgmt	1 7	1 4	1 5	1 3	1 4
Commissions insurance	54	53	52	51	49
commissions Guarantee	1 3	1 4	1 4	6	1 4
Estate agency	107	131	103	93	111
services Accountancy	114	154	148	111	105
Securities	110	182	275	245	122
commissions Other	7	1 4	5	9	9
Commissions Bolig/Næringskreditt ex.	497	631	675	598	494
Commissions Boligkreditt bonds) (cov	123	113	112	136	128
Commissions Næringskreditt (cov bonds)	3	4	4	4	4
commission income Total	623	748	790	738	625

Cost development

Reduced costs compared to Q2

SpareBank 1 Markets reduced costs in Q3 after two quarters with high variable remuneration

Reduced costs in Q3 in other subsidiaries due to low activity in the summer months

Cost increase in the parent bank mainly due to wage settlements and temporary employees in the summer months

Total quarterly costs (NOK mill)

Reduced losses in 2021

Loan losses per quarter, NOK mill

Loan losses measured 0.07% (annualised) of gross loans in the third quarter of 2021

103 308 170 ^{231 242} 59 39 31 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21

Distribution of losses Q321

Strong capitalisation

CET1 ratio

Leverage ratio

Goals

SpareBank 1 SMN aims to be the leading finance house in Central Norway and among the best performers in the Nordic region

< 2%

↓ 50%

Profitable Return on equity 12%

Solid

CET1 ratio 16.9% Payout ratio approx. 50%

Efficient

Annual growth in group costs limited to 2% within existing business

Responsible

Aims to halve the group's climate footprint by 2030 Reduction of 8% per year

SpareBank 1 SMN (MING) - an attractive investment

High return over time and solidly capitalised. Efficient banking operations and unrealised income and cost synergies in the group. Shareholder-friendly dividend policy

Strong position and good growth in an attractive region and in all business lines. Diversified customer portfolio and income base

A good brand with development potential based on ownership model, presence and sustainability

Substantial underlying value through ownership positions in and outside SpareBank 1-alliansen

Well positioned as regards to consolidation among Norwegian savings banks

SpareBank 1 SMN

CEO Jan-Frode Janson Tel +47 909 75 183 E-mail jan-frode.janson@smn.no

CFO Kjell Fordal Tel +47 905 41 672 E-mail kjell.fordal@smn.no

SpareBank 1 SMN Tel +47 915 07 300

Internet address www.smn.no

Appendix

SpareBank 1 SMN's strategic priorities

Sustainability

Goals and key targets

First step towards sustainable development

Innovation

Create green growth and business development through cooperation and partnerships

Customer offering

Offer products and services which encourage customers' green transition and digitalisation

Climate footprint

Reduce the climate footprint across the entire value chain

Competence

Strengthen climate risk competence and reporting

Diversity

Contribute to diversity and a fair transition

↑10% 10% annual increase qualifying for green bond financing Engage customers and partners in the development of innovative local communities

Halve the group's climate footprint by 2030. Reduction of 8% per year

Offer competence programme for customers and employees

↓ 50%

Strengthen equal opportunities in working life, everyday life and business

Proposed dividend NOK 4.40 per equity certificate, in accordance with the bank's dividend policy

• In light of the Ministry of Finance's recommendation, NOK 1.30 was paid out in April
• The remaining NOK 3.10 dividend to be paid out on 9. November 2021

Good results

Good quarterly results and 12.4 per cent return on equity

Good net interest income, reduced costs and low loan losses

Good results from Fremtind Forsikring

mill NOK	2021	2020	Change	Q3 21	Q2 21	Q1 21	Q4 20	Q3 20
interest income Net	2 073	2 071	2	698	698	668	688	695
Commission income income and other	2 161	1 779	383	623	748	790	738	625
Operating income	4 234	3 849	385	1 321	1 445	1 459	1 425	1 321
Total operating expenses	2 228	2 080	148	698	735	796	824	675
business Pre-loss result of core	2 006	769 1	237	623	711	663	601	645
loans and Losses guarantees on	129	709	-580	3 1	3 9	9 5	242	231
business Post-loss result of core	1 877	1 060	817	592	672	604	359	414
companies Related	519	224	295	179	212	128	117	170
Gain Fremtind	0	340	-340
Securities foreign and derivates currency ,	289	189	99	69	5 9	161	80	3 4
Result before tax	2 685	814 1	871	840	942	893	556	619
Tax	497	295	202	175	191	131	105	102
Result investment held for sale	11	9	2	1	4	6	0	2
profit Net	2 199	1 528	671	666	755	768	450	519
equity Return on	13 8 % ,	10 4 % ,		12 4 % ,	14 3 % ,	14 8 % ,	8 9 % ,	10 5 % ,

Balance sheet

	30 9 21	30 9 20	30 9 19
available Funds	38 5 ,	32 1 ,	26 0 ,
loans Net	142 4 ,	132 2 ,	125 3 ,
Securities	2 5 ,	9 1 ,	3 0 ,
in related companies Investment	7 3 ,	7 0 ,	6 5 ,
Goodwill	0 9 ,	0 9 ,	0 9 ,
Other assets	8 4 ,	12 8 ,	5 1 ,
Total Assets	200 1 ,	186 9 ,	166 7 ,
Capital funding market	56 5 ,	57 7 ,	9 51 ,
Deposits	109 7 ,	95 4 ,	85 9 ,
liabilities Other	9 1 ,	2 11 ,	6 4 ,
Subordinated debt	1 8 ,	1 8 ,	2 1 ,
Equity hybrid bonds ex	21 8 ,	19 6 ,	19 1 ,
Hybrid bonds	1 3 ,	1 2 ,	1 3 ,
liabilities equity Total and	200 1 ,	186 9 ,	166 7 ,
addition loans sold Boligkreditt and Næringskreditt In to	48 0 ,	45 8 ,	41 4 ,

Commission income

Year to date and quarterly numbers

mill NOK	2021	2020	Change	Q3 21	Q2 21	Q1 21	Q4 20	Q3 20
transmission income Payment	167	163	4	61	56	49	56	54
Credit cards	41	45	-4	1 4	1 3	1 4	1 4	1 5
Commissions savings and asset mgmt	45	41	5	1 7	1 4	1 5	1 3	1 4
Commissions insurance	159	144	1 5	54	53	52	51	49
commissions Guarantee	42	42	0	1 3	1 4	1 4	6	1 4
Estate agency	341	300	41	107	131	103	93	111
services Accountancy	416	395	2 1	114	154	148	111	105
Securities	566	332	235	110	182	275	245	122
Other commissions	2 6	36	-10	7	1 4	5	9	9
Commissions Bolig/Næringskreditt ex	1 803	1 497	306	497	631	675	598	494
Commissions Boligkreditt bonds) (cov	348	272	75	123	113	112	136	128
Commissions Næringskreditt bonds) (cov	1 1	9	1	3	4	4	4	4
commission income Total	2 161	1 779	383	623	748	790	738	625

Product companies in SpareBank 1-alliansen

Year to date and quarterly numbers

Share of profits after tax

Profit share after tax mill in share parentheses NOK SMN's ,	2021	2020	Change		Q2 21	Q1 21	Q4 20	Q3 20
SpareBank (19 5%) 1 Gruppen	298	107	191	83	148	67	87	114
Gain Fremtind	0	340	-340	0	0	0	0	0
Boligkreditt SpareBank (22 4%) 1	18	2 2	-3	11	3	4	-4	11
SpareBank Næringskreditt (31 0%) 1	6	14	-7	-1	4	3	5	5
Bank (35 0%) BN	122	84	38	40	42	40	36	34
SpareBank Kreditt (19 2%) 1	11	2	10	10	1	0	0	0
SpareBank Betaling (19 5%) 1	-6	-3	-3	0	-5	-1	1	-1
SpareBank Forvaltning (23 4%) 1	2 0	0	2 0	13	8	0	0	0
Other companies	14	0	14	-2	11	5	-9	10
associated companies Sum	519	564	-45	179	212	130	117	172

Subsidiaries

Year to date and quarterly numbers

Profit before tax

mill in share parentheses NOK SMN's ,	2021	2020	Change	Q3 21	Q2 21	Q1 21	Q4 20	Q3 20
EiendomsMegler Midt (87 %) 1 -Norge	70	50	2 0	8	41	2 1	2	1 9
SpareBank Regnskapshuset SMN (89 %) 1	82	88	-6	2 1	33	2 7	2 2	2 1
SpareBank Finans Midt (61 %) 1 -Norge	153	132	2 1	35	63	55	52	52
SpareBank Markets (67 %) 1	203	81	122	2 3	62	118	91	31
SpareBank (100%) 1 SMN Invest	190	-15	206	61	2 1	109	2 1	-3
companies Other	4	7	-3	1	2	1	2	1
Subsidiaries	702	342	359	149	223	330	190	122

Return on financial investments

Year to date and quarterly numbers

mill NOK	2021	2020	Change	Q3 21	Q2 21	Q1 21	Q4 20	Q3 20
gain/(loss) stocks Net on	161	-6	166	3 6	23	102	-3	4
gain/(loss) financial instruments Net on	3 0	62	-31	14	-4	20	61	13
gain/(loss) forex Net on	46	68	-22	16	15	15	3	11
gain/(loss) stocks and stock derivatives Markets Net SB1 on	3 0	21	9	2	8	20	2	5
financial instruments Net return on	267	145	123	68	42	158	53	32

Equity certificate, key figures

figures Key	30 9 21	30 9 20	2020	2019	2018	2017
ratio ECC	64 0 % ,	64 0 % ,	64 0 % ,	64 0 % ,	64 0 % ,	64 0 % ,
issued (mill) Total ECCs	129 39 ,	129 44 ,	129 39 ,	129 30 ,	129 62 ,	129 38 ,
price ECC	129 80 ,	84 30 ,	97 60 ,	100 20 ,	84 20 ,	82 25 ,
Market value (NOKm)	16 794	10 912	12 629	12 956	10 914	10 679
Booked equity capital ECC per	103 57 ,	92 73 ,	94 71 ,	90 75 ,	83 87 ,	78 81 ,
earnings in Post-tax ECC NOK per ,	10 11 ,	6 88 ,	8 87 ,	12 14 ,	9 97 ,	8 71 ,
Dividend ECC per		0 00 ,	4 40 ,	6 50 ,	5 10 ,	4 40 ,
P/E	9 62 ,	9 19 ,	11 01 ,	8 26 ,	8 44 ,	9 44 ,
Price equity capital / Booked	1 25 ,	0 91 ,	1 03 ,	1 10 ,	1 00 ,	1 04 ,

Change in net interest income

NIBOR increased in Q3:

Lending growth and higher deposit margins strengthens NII

Lower lending margins decreased NII

Change from Q2 to Q3 2021

Change	0
Net interest previous quarter	698
Net interest this quarter	698

Obtained as follows:

Fees on lending	2
Lending volume	71
Deposit volume	-2
Lending margin	-57
Deposit margin	25
Equity capital	5
Funding and liquidity buffer	-33
Subsidiaries	-2
Change	9

Good access to capital market financing

Maturity structure as at September 30 2021 (NOKb)

Comments

• Boligkreditt is a significant source of funding; mortgages totalling NOK 47bn sold as at 30 September 2021
• Total maturing over next 2 years NOK 16.7bn:
  • NOK 1.0bn in Q4 2021
  • NOK 6.6bn in 2022
  • NOK 9.1bn in Q1 and Q2 2023
• LCR 163% as at 30 September 2021, well within the target in the liquidity strategy
• SpareBank 1 SMN issued senior non-preferred debt (MREL) of NOK 1bn in third quarter 2020, NOK 1.5bn in first quarter 2021 and NOK 1.0bn in third quarter 2021
• SpareBank 1 SMN issued a green senior bond of EUR 500m with a 7-year maturity in February 2021

Strong trend in CET1 capital and capital adequacy

Robust loan portfolio

The portfolio is dominated by mortgages, and the corporate portfolio reflects the composition of Mid-Norway's business sector

Loan portfolio per 30.09.21 (bNOK) Changes last 12 months (bNOK)

Potential problem loans

Loans to customers in stage 3

Loans (million NOK and % of gross loans)

Loans to customers in stage 3 In per cent of gross loans

New regulatory definition of default increased stage 3 loans from 2021

The new definition has not changed the groups assessment of its credit risk exposure; hence it has no material effect on losses

The increase in potential problem loans this year is due to exposures that previously exited non-performing status, but are classified as on probation according to the new regulatory definition of default

Offshore only 2.3% of total exposure. 18.1% of the offshore portfolio written down

EAD per segment (mill NOK)

Offshore share of overall EAD

				Total
Distribution	EAD	Loans	Stage 3	1/2 Stage	impairments	of Share EAD
risk Low	199	168			0 3 ,	0 1 % ,
Medium risk	2 193	1 644		135	135	6 1 % ,
High risk	798	556		46	46	5 7 % ,
Obligors with impairments/defaulted	1 574	1 574	680		680	43 2 % ,
	765 4	3 942	680	181	861	18 % 1 ,

The SpareBank 1 Alliance

The SpareBank 1 Alliance

Strong position nationally, regional focus

• SpareBank 1-alliansen consists of 15 banks
• Operates exclusively in Norway
• The bank grouping in Norway with the most bank branches
• The SpareBank 1 banks are on the forefront of digitalisation and technological development
• The SpareBank 1 banks are independent banks in their respective regions
• They are market leaders in their most important regional market areas
• The largest of them (~ 80% of total assets) have the following rating:

Sr. unsec. ratings	Moody's
SpareBank 1 SMN	A1 / P-1
SpareBank 1 SR	A1 / P-1
SpareBank 1 SNN	Aa3 / P-1
SpareBank 1 Østlandet	Aa3 / P-1