SpareBank 1 SMN

Investor Presentation • Feb 10, 2022

Fourth quarter 2021

1. February 2022

Kjell Fordal CFO

Trond Søraas Incoming CFO

Growth and profitability

• Record result and high growth in 2021 strengthened market position and good profitability across all business segments
• Transition and modernisation One SMN gives efficiency, better customer experiences and improved distribution – a solid foundation for growth
• Reduced loan losses: Improvement in the offshore segment, sound credit quality in business and mortgage loans
• SMN is solid with good dividend capacity Dividend of NOK 7.5 per EC for 2021 NOK 547m allocated to community dividend
• SMN aims to be the leading finance house in Mid-Norway and among the best performers in the Nordic region

Savings banks market position strenghtened over time – the large regional banks are the best performers

Market share lending for Norwegian savings banks

Profitability

Return on equity Per Q321

Norwegian savings banks Large nordic banks

Q4 2021

Net profit

NOK 703m (450) in Q4 NOK 2 902 (1 978) in 2021

Return on equity

12.7% (8.9) in Q4 13.5% (10.0) in 2021

CET1 ratio 18.0% (18.3)

Lending growth 1.8% (1.9) in Q4 and 6.9% (9.0) in 2021

Deposit growth 1.5% (2.2) in Q4 and 14.1% (13.5) in 2021

Book value per EC NOK 103.48 (94.71) Earnings per EC NOK 13.31 (8.87) in 2021

Dividend of NOK 7.50 (4.40) per EC Community dividend of NOK 547m (321) Payout ratio 56.3%

Key figures Last four years

Return on equity

CET1 ratio

Results per EC Loan losses in per cent of total lending

Events in 2021

Solid macro backdrop going into 2022

Increased housing prices

Low unemployment

Improved outlook for commercial real estate due to the economic recovery – agriculture looks more demanding

The customers are choosing SMN Strengthened attractiveness in retail and corporate segment alike

Retail market

2 % 4 % 4 % 2 % Primary bank¹ (%) Preference share² (%) Primary bank (%) Preference share (%) SpareBank 1 SMN SpareBank 1 SMN SpareBank 1 SMN SpareBank 1 SMN

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

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

9 Fourth quarter 2021

SpareBank 1 SMN's strategic priorities

Strong subsidiaries enable synergies

Pre-tax profit last four years, NOKm

EiendomsMegler 1 Midt-Norge

SpareBank 1 Regnskapshuset SMN

SpareBank 1 Markets SpareBank 1 Finans Midt-Norge

SpareBank 1 SMN opens an Oslo branch

• SB 1 Markets has strenghtened its market position in recent years, as the main shareholder and in line with the group strategy there is a large potential in leveraging relations and activities together
• SMN has an increasing number of retail and business customers in South-Eastern Norway

that will be offered the same attentiveness. Physical presence in Oslo enables SMN to offer a full breadth of products to more customers in a large market

• Gradual build-up with emphasis on synergies between the corporate banking arm and the capital market services in SB1 Markets, with controlled growth, limited concentration and moderate risk
• SMN will give the Oslo market a broader product range and options – «try a savings bank and enjoy the difference»

Data-driven growth Increased efficiency with robots

Increase in digital sales

Share of digital sale in the retail market

Increased digitalisation

Share of loan applications in the retail market initiated through digital channels

SMN has a high RPA competence – Joint resources within SMN and a part of the SpareBank 1 Alliance' specialist environment

Close cooperation between the business and technology environments

reducing time from business needs to automated processes

The main focus in 2021 has been onboarding business customers and the loan process in the retail segment

Robotic traffic increased 40 % last year

Sustainability and social responsibility

SMN has committed to sustainability ambitions

and are now executing the sustainability strategy

Balanced approach to ESG

A number of measures within the five prioritised areas of the strategy are completed. This work gives insight into methods, model framework and the taxonomy as well as improved estimates of SMN's and the lending books' climate footprint

SMN will be a driver for green transition

In 2022 SMN will concretise goals and measures that supports the transition of the local business community and society

Innovation

1

2

3

4

5

Create green business growth through cooperation and partnership

Customer offerings

Offer products and services that stimulate the clients' transition and digitalisation

Climate footprint

Reduce climate footprint throughout the value chain

Competence

Strengthen competence and reporting on climate risk

Diversity

Contribute to diversity and a fair transition

We care about the local community

Each year the community dividend contributes to non-profit purposes that makes Mid-Norway better and more sustainable

The community dividend is invested in five key areas

Community

We care about people. Both in our local community and the rest of the world

Sports and outdoor activities

We contribute to improved public health through supporting sports, games and outdoor activities

Art and culture

We create a vibrant and diverse cultural life with great experiences locally

Innovation and value creation

As an important institution in our region we add culture, competence and capital that shapes tomorrows business environment

Sustainability

We are a driver for green transition and engages the region in yearly improvements in order the reach the sustainability goals

Financial information

Profitable and solid

Return on equity

CET1 ratio

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

Income, costs and losses

Last four years, NOKm

Net interest income

Commission income

Costs Loan losses

High activity and synergies supports growth in personal banking

SMN strengthens its position in the corporate segment

Corporate Banking

Profit before tax (NOKm)

SMN Finans SB1 Markets Regnskapshuset Corporate Market

Regnskapshuset SMN becomes a national LO-partner

Accounting firm signs national agreement

SpareBank 1 Regnskapshuset SMN has signed a national agreement with the labour organisation LO

SB 1 Markets is the leading IPO manager in the Norwegian market

	#1 IPO manager 1 (2017-2021)
Rank	Managers	NOKm	No.	Share
$\mathbf{1}$	SB1M	20,334	47	17%
$\overline{2}$	ABGSC	17,506	40	14%
3	Carnegie	16,510	37	13%
4	DNB Markets	11,908	41	10%
5	Pareto	10,241	35	8%
6	Arctic	7,314	28	6%
7	SEB	5,595	18	5%
8	Fearnley	5,339	21	4%
9	Morgan Stanley	4,965	4	4%
10	Nordea	4,610	11	4%
11	Jefferies	4,310	2	4%
12	Citi	3,994	2	3%
13	JPMorgan	3,688	$\overline{2}$	3%
14	Mizuho	2,585	1	2%
15	Danske Bank	1,744	8	1%
16	Clarksons	1,644	9	1%
17	Swedbank	1,621	7	1%
18	Goldman Sachs	1,253	2	1%
19	Pangea	667	1	1%
20	Credit Suisse	632	1	1%
	Others	2,910	16	2%

Source: Dealogic, per 03.01.22 1) Oslo Stock Exchange

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, including Fremtind and SpareBank 1 Forsikring

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

Lending growth

Lending growth RM 7.7% (CAGR)

Share of lending, CM and RM

Total loans NOK 195bn, 2021 growth of 6.9 per cent

Market growth in mortgages 5.0 per cent (C2) in 2021

Good growth spread both geographically and across a wide range of customers

Lending growth CM 5.7% (CAGR)

Lending margins

Norges Bank increased the key policy rate to 0.5 % in December 2021

Repricing of mortgages with effect from mid-November 2021 and February 2022

Increased NIBOR in the second half of 2021 weakened margins

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

Deposit growth

Deposit growth RM 8.8% (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 10.5% (CAGR)

Share of deposits, CM and RM

Deposit margins

Deposit margins versus 3M NIBOR

Increased NIBOR strengthened deposit margins in the quarter

Deposit rates increased following Norges Banks rate hike

Robust income platform

Net interest income and other income Commission income

Net interest income

Commission income

Boligkreditt and Næringskreditt

mill NOK	Q4 21	Q3 21	Q2 21	Q1 21	Q4 20
transmission income Payment	72	61	56	49	56
Credit cards	1 4	1 4	3 1	1 4	1 4
Commissions savings and asset mgmt	3 1	1 7	1 4	1 5	3 1
Commissions insurance	55	54	53	52	51
commissions Guarantee	2 2	1 3	1 4	1 4	6
Estate agency	100	107	131	103	93
services Accountancy	114	114	154	148	111
Securities	158	110	182	275	245
commissions Other	1 7	7	1 4	5	9
Commissions Bolig/Næringskreditt ex.	565	497	631	675	598
Commissions Boligkreditt bonds) (cov	102	123	113	112	136
Commissions Næringskreditt bonds) (cov	3	3	4	4	4
commission income Total	671	623	748	790	738

Cost development

Reduced costs year-on-year

SpareBank 1 Markets with lower costs YoY due to extraordinary high income, and associated costs, in Q420

Cost growth in subsidiaries contributable to acquisitions and IT investments in the accountancy arm and high activity in the brokerage firm EM1

The parent banks' 2020 costs include reorganisation costs of NOK 80m. Growth exceeding this is mainly attributable to employee bonuses and increased IT costs

Total quarterly costs (NOK mill)

Reduced losses in 2021 Loan losses (NOKm)

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

Significant improvement in the offshore portfolio. Higher utilisation, freight rates and more ships are contracted

Low exposure towards segments hit by covid

Very low number of bankruptcies in Mid-Norway in 2021. Down 21 per cent compared to 2020, 41 per cent below 2019

Distribution of losses Q321

Strong trend in CET1 capital and capital adequacy

Dividend

Proposed dividend NOK 7.50 per EC

Total dividend of NOK 970m

Community dividend of NOK 547m, of which NOK 250m to be distributed to non-profit causes

Payout ratio of 56.3 per cent

NOK 1,177m of the result is retained earnings

Solid profitability has given good return for owners

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

Trond Søraas will be the new CFO at SpareBank 1 SMN

Trond Søraas replaces Kjell Fordal

As from March 2022 he takes over the role as CFO and head of Group Finance and Governance at SpareBank 1 SMN

Mr. Søraas comes from BN Bank where he has held the post of CFO since 2010

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

Incoming CFO Trond Søraas Tel +47 922 36 803 E-mail trond.soraas@smn.no

SpareBank 1 SMN Tel +47 915 07 300

Internet address www.smn.no

Appendix

A strong 2021

12.7 per cent return on equity in Q4

Good net interest income, reduced costs and low loan losses

Good results from Fremtind Forsikring and SpareBank 1 Forsikring

A record result of NOK 2.9bn

mill NOK	2021	2020	Change	Q4 21	Q3 21	Q2 21	Q1 21	Q4 20
interest income Net	2 796	2 759	3 8	723	707	698	668	688
Commission income income and other	2 832	2 516	316	671	623	748	790	738
Operating income	5 628	5 275	354	1 394	1 330	1 445	1 459	1 425
operating Total expenses	2 993	2 904	89	765	698	735	796	824
business Pre-loss result of core	2 635	2 370	265	629	633	711	663	601
loans and Losses guarantees on	161	951	-791	3 2	3 1	3 9	9 5	242
business Post-loss result of core	2 475	1 419	1 056	597	601	672	604	359
companies Related	705	341	364	186	179	212	128	117
Gain Fremtind	0	340	-340
Securities foreign derivates and currency ,	321	269	5 2	3 3	69	5 9	161	80
Result before tax	3 501	2 370	132 1	816	849	942	893	556
Tax	609	400	209	112	175	191	131	105
Result investment held for sale	10	9	1	0	1	4	6	0
profit Net	2 902	1 978	924	703	675	755	768	450
equity Return on	13 5 % ,	10 0 % ,		12 7 % ,	12 4 % ,	14 3 % ,	14 8 % ,	8 9 % ,

Commission income

Year to date and quarterly numbers

mill NOK	2021	2020	Change	Q4 21	Q3 21	Q2 21	Q1 21	Q4 20
transmission income Payment	238	219	9 1	72	61	56	49	56
Credit cards	56	59	-3	1 4	1 4	3 1	1 4	1 4
Commissions savings and asset mgmt	59	53	6	3 1	1 7	1 4	1 5	3 1
Commissions insurance	214	195	9 1	55	54	53	52	51
commissions Guarantee	64	48	6 1	2 2	3 1	1 4	1 4	6
Estate agency	441	392	49	100	107	131	103	93
services Accountancy	529	506	2 4	114	114	154	148	111
Securities	725	577	148	158	110	182	275	245
commissions Other	43	45	-3	1 7	7	1 4	5	9
Commissions Bolig/Næringskreditt ex	2 368	2 094	274	565	497	631	675	598
Commissions Boligkreditt bonds) (cov	450	408	41	102	123	113	112	136
Commissions Næringskreditt bonds) (cov	1 4	3 1	1	3	3	4	4	4
commission income Total	2 832	2 516	316	671	623	748	790	738

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	Q4 21	Q3 21	Q2 21	Q1 21	Q4 20
SpareBank (19 5%) 1 Gruppen	471	194	277	173	83	148	67	87
Gain Forsikring SpareBank 1	0	340	-340	0	0	0	0	0
Boligkreditt SpareBank (20 9%) 1	16	18	-2	-2	11	3	4	-4
SpareBank Næringskreditt (12 8%) 1	7	18	-11	0	-1	4	3	5
Bank (35 0%) BN	164	120	44	42	40	42	40	36
SpareBank Kreditt (19 2%) 1	13	2	11	2	10	1	0	0
SpareBank Betaling (21 5%) 1	-15	-2	-13	-9	0	-5	-1	1
SpareBank Forvaltning (19 9%) 1	32	0	32	12	13	8	0	0
Other companies	17	-10	2 7	-32	-2	11	14	-9
associated companies Sum	705	681	24	186	179	212	128	117

Subsidiaries

Year to date and quarterly numbers

Profit before tax

mill in share parentheses NOK SMN's ,	2021	2020	Change	Q4 21	Q3 21	Q2 21	Q1 21	Q4 20
EiendomsMegler Midt (87 %) 1 -Norge	71	52	1 9	1	8	41	2 1	2
SpareBank Regnskapshuset SMN (89 %) 1	85	110	-25	3	2 1	33	2 7	2 2
Finans Midt SpareBank (56 %) 1 -Norge 5 ,	198	184	1 4	45	35	63	55	52
SpareBank Markets (67 %) 1	254	169	85	51	2 3	62	118	91
SpareBank SMN (100%) 1 Invest	187	6	181	-4	61	2 1	109	2 1
companies Other	4	8	-5	0	1	2	1	2
Subsidiaries	799	530	269	97	149	223	330	190

Return on financial investments

Year to date and quarterly numbers

mill NOK	2021	2020	Change	Q4 21	Q3 21	Q2 21	Q1 21	Q4 20
gain/(loss) stocks Net on	176	-4	180	15	3 6	23	102	-3
gain/(loss) financial instruments Net on	21	125	-104	-9	14	-4	20	5 1
gain/(loss) forex Net on	7 0	82	-12	24	16	15	15	3
gain/(loss) derivatives stocks and stock Markets SB1 Net on	3 1	28	4	1	2	8	20	2
financial instruments Net return on	299	230	69	32	68	42	158	53

Equity certificate, key figures

figures Key	2021	2020	2019	2018	2017
ratio ECC	64 0 % ,	64 0 % ,	64 0 % ,	64 0 % ,	64 0 % ,
issued (mill) Total ECCs	129 39 ,	129 39 ,	129 30 ,	129 62 ,	129 38 ,
price ECC	149 00 ,	97 60 ,	100 20 ,	84 20 ,	82 25 ,
Market value (NOKm)	19 279	12 629	12 956	10 914	10 679
Booked equity capital ECC per	103 48 ,	94 71 ,	90 75 ,	83 87 ,	78 81 ,
earnings in Post-tax ECC NOK per ,	13 31 ,	8 87 ,	12 14 ,	9 97 ,	8 71 ,
Dividend ECC per	7 50 ,	4 40 ,	6 50 ,	5 10 ,	4 40 ,
P/E	11 19 ,	11 01 ,	8 26 ,	8 44 ,	9 44 ,
Price equity capital / Booked	1 44 ,	03 1 ,	10 1 ,	00 1 ,	04 1 ,

Change in net interest income from Q3 to Q4

NIBOR increased in Q4:

Lending growth and higher deposit margins strengthens NII

Lower lending margins decreased NII

Return on equity capital increases

Change from Q3 to Q4 2021

Change	16
Net interest previous quarter	707
Net interest this quarter	723

Obtained as follows:

Lending volume	10
Deposit volume	0
Lending margin	-95
Deposit margin	70
Equity capital	17
Funding and liquidity buffer	15
Subsidiaries	-3
Change	16

Change in net interest income 2020 - 2021 Change from 2020 to 2021

NIBOR3M increased in the second half of 2021, but the yearly average was below 2020

Lending growth strengthens NII, while lower lending margins subdues the effect

Change	38
interest Net 2020	2 759
interest 2021 Net	2 796

Obtained as follows:

lending Fees on	10
Lending volume	206
Deposit volume	-13
Lending margin	-263
Deposit margin	54
Equity capital	1
Funding liquidity and buffer	29
Subsidiaries	14
Change	38

Balance sheet

NOKbn	31 12 21	31 12 20	31 12 19
available Funds	36 7 ,	34 5 ,	26 0 ,
loans Net	145 9 ,	133 1 ,	125 3 ,
Securities	2 7 ,	2 4 ,	3 0 ,
in companies related Investment	7 4 ,	3 7 ,	6 5 ,
Goodwill	0 9 ,	0 9 ,	0 9 ,
Other assets	5 3 ,	9 7 ,	5 1 ,
Total Assets	198 8 ,	187 9 ,	166 7 ,
Capital funding market	55 4 ,	57 0 ,	51 9 ,
Deposits	3 111 ,	97 5 ,	85 9 ,
liabilities Other	7 1 ,	10 3 ,	6 4 ,
Subordinated debt	1 8 ,	1 8 ,	2 1 ,
Equity hybrid bonds ex	21 9 ,	20 0 ,	19 1 ,
Hybrid bonds	1 3 ,	1 3 ,	1 3 ,
liabilities equity Total and	198 8 ,	187 9 ,	166 7 ,
addition loans sold Boligkreditt and Næringskreditt In to	48 1 ,	48 2 ,	41 5 ,

Lending per quarter

Relatively stable growth in retail and corporate markets last quarters

Retail Market

Corporate Market

Deposits per quarter

Increase in deposits from retail market and corporate market in Q4 following a reduction in Q3

Retail Market Corporate Market

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 31.12.21 (bNOK) Changes last 12 months (bNOK)

8,4

Potential problem loans

New regulatory definition of default increased stage 3 loans from 2021

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

The increase in potential problem loans in 2021 is due to exposures that previously exited non-performing status, but are classified as on probation according to the new regulatory definition of default

In Q4 a few exposures went off probation, reducing loans to customers in stage 3

Loans to customers in stage 3

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

Offshore supply vessels constitutes a decreasing part of total exposure (2%). 16.1% of the offshore portfolio written down

EAD per segment (mill NOK)

Offshore share of overall EAD

					Total
Distribution	EAD	Loans	Stage 3	Stage 1/2	impairments	Share of EAD
Low risk	292	218			0,3	0,1 %
Medium risk	1 763	1 337		125	125	7,1 %
High risk	500	244		46	46	9,1 %
Obligors with impairments/defaulted	1 683	1 683	510		510	30,3 %
	4 238	3 482	510	171	681	16,1 %

Strong capitalisation

Leverage ratio

Good access to capital market financing

Maturity structure as at December 31 2021 (NOKbn)

Comments

Boligkreditt and Næringskreditt are significant sources of funding; mortgages totalling NOK 48bn sold as at 31 December 2021

Total maturing over next 2 years NOK 15.5bn:

• NOK 6.4bn in 2022
• NOK 9.1bn in 2023

LCR 138% as at 31 December 2021, well within the target in the liquidity strategy

SpareBank 1 SMN have issued senior nonpreferred debt (MREL) of NOK 3.5bn, of which NOK 2.5bn in 2021

SpareBank 1 SMN issued a green senior bond of EUR 500m with a 7-year maturity in February 2021

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