Quarterly Report • Oct 28, 2022
Quarterly Report
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Steinvikholmen
| Main figures 3 | |
|---|---|
| Report of the Board of Directors 5 | |
| Income statement 24 | |
| Balance sheet 26 | |
| Cash flow statement 27 | |
| Change in equity 28 | |
| Notes 31 | |
| Results from quarterly accounts 63 | |
| Key figures from quarterly accounts 64 | |
| Equity capital certificates 65 | |
| Auditor's report 67 |
| Third quarter | January - September | ||||
|---|---|---|---|---|---|
| From the income statement (NOKm) | 2022 | 2021 | 2022 | 2021 | 2021 |
| Net interest | 811 | 707 | 2,370 | 2,073 | 2,796 |
| Net commission income and other income | 540 | 623 | 1,921 | 2,161 | 2,832 |
| Net return on financial investments | 148 | 248 | 427 | 808 | 1,026 |
| Total income | 1,499 | 1,578 | 4,718 | 5,042 | 6,655 |
| Total operating expenses | 688 | 698 | 2,208 | 2,228 | 2,993 |
| Results before losses | 810 | 880 | 2,511 | 2,814 | 3,662 |
| Loss on loans, guarantees etc | 22 | 31 | -26 | 129 | 161 |
| Results before tax | 788 | 849 | 2,536 | 2,685 | 3,501 |
| Tax charge | 172 | 175 | 520 | 497 | 609 |
| Result investment held for sale, after tax | 1 | 1 | 0 | 11 | 10 |
| Net profit | 617 | 675 | 2,017 | 2,199 | 2,902 |
| Interest Tier 1 Capital | 12 | 10 | 45 | 40 | 50 |
| Net profit excl. Interest Tier 1 Capital | 604 | 665 | 1,971 | 2,159 | 2,852 |
| Balance sheet figures | 30 Sep 2022 |
30 Sep 2021 |
31 Dec 2021 |
|---|---|---|---|
| Gross loans to customers | 150,247 | 143,972 | 147,301 |
| Gross loans to customers incl. SB1 Boligkreditt and SB1 Næringskreditt | 208,900 | 191,976 | 195,353 |
| Deposits from customers | 120,558 | 109,691 | 111,286 |
| Average total assets | 210,562 | 195,571 | 196,229 |
| Total assets | 218,918 | 200,124 | 198,845 |
| Third quarter | January - September | ||||
|---|---|---|---|---|---|
| Key figures | 2022 | 2021 | 2022 | 2021 | 2021 |
| Profitability | |||||
| Return on equity 1) | 10.9 % | 12.4 % | 12.0 % | 13.8 % | 13.5 % |
| Cost-income ratio 1) | 46 % | 44 % | 47 % | 44 % | 45 % |
| Deposit-to-loan ratio excl. SB1 Boligkreditt and SB1 Næringskreditt | 80 % | 76 % | 80 % | 76 % | 76 % |
| Deposit-to-loan ratio incl. SB1 Boligkreditt and SB1 Næringskreditt 1) | 58 % | 57 % | 58 % | 57 % | 57 % |
| Growth in loans (gross) last 12 months (incl. SB1 Boligkreditt and SB1 | |||||
| Næringskreditt) 1) | 1.7 % | 1.6 % | 8.8 % | 7.0 % | 6.9 % |
| Growth in deposits last 12 months | -2.6 % | -0.4 % | 9.9 % | 15.0 % | 14.1 % |
| Losses in % of gross loans incl. SB1 Boligkreditt and SB1 Næringskreditt |
|||||
| Impairment losses ratio 1) | 0.04 % | 0.07 % | -0.02 % | 0.09 % | 0.09 % |
| Stage 3 as a percentage of gross loans 1) | 1.02 % | 1.80 % | 1.02 % | 1.80 % | 1.68 % |
| 30 Sep | 30 Sep | 31 Dec |
| Solidity | 2022 | 2021 | 2021 |
|---|---|---|---|
| Capital ratio | 23.0 % | 21.8 % | 21.6 % |
| Tier 1 capital ratio | 20.8 % | 19.7 % | 19.6 % |
| Common equity Tier 1 capital ratio | 19.2 % | 18.1 % | 18.0 % |
| Tier 1 capital | 21,252 | 19,265 | 19,322 |
| Total eligible capital | 23,546 | 21,338 | 21,333 |
| Liquidity Coverage Ratio (LCR) | 180 % | 163 % | 138 % |
| Leverage Ratio | 7.3 % | 6.9 % | 6.9 % |
| Branches and staff | |||
| Number of branches | 40 | 42 | 40 |
| No. Of full-time positions | 1,608 | 1,529 | 1,548 |
1) Defined as alternative performance measures, see attachment to quarterly report
| Key figures ECC | 30 Sep 2022 |
30 Sep 2021 |
31 Dec 2021 |
31 Dec 2020 |
31 Dec 2019 |
31 Dec 2018 |
|---|---|---|---|---|---|---|
| ECC ratio | 64 % | 64 % | 64 % | 64 % | 64.0 % | 64.0 % |
| Number of certificates issued, | ||||||
| millions 1) | 129.29 | 129.39 | 129.39 | 129.39 | 129.30 | 129.62 |
| ECC share price at end of period | ||||||
| (NOK) | 111.40 | 129.80 | 149.00 | 97.60 | 100.20 | 84.20 |
| Stock value (NOKM) | 14,402 | 16,794 | 19,279 | 12,629 | 12,956 | 10,914 |
| Booked equity capital per ECC | ||||||
| (including dividend) 1) | 107.19 | 103.57 | 103.48 | 94.71 | 90.75 | 83.87 |
| Profit per ECC, majority 1) | 9.29 | 10.11 | 13.31 | 8.87 | 12.14 | 9.97 |
| Dividend per ECC | 0.00 | 0.00 | 7.50 | 4.40 | 6.50 | 5.10 |
| Price-Earnings Ratio 1) | 9.00 | 9.62 | 11.19 | 11.01 | 8.26 | 8.44 |
| Price-Book Value Ratio 1) | 1.04 | 1.25 | 1.44 | 1.03 | 1.10 | 1.00 |
1) Defined as alternative performance measures, see attachment to quarterly report.
(Consolidated figures. Figures in parenthesis refer to the same period of 2021 unless otherwise stated)
Norges Bank hiked its base rate to 1.75 per cent in August and further to 2.25 per cent in September. Like other banks, SpareBank 1 SMN has raised its interest rates on mortgages and deposits. Base rates have been raised in several countries, and further increases are expected.
Inflation has risen rapidly and has been higher than expected, also when energy prices are excluded. The labour market is tight, but there are clear signs that the economy is cooling. Easing pressures in the economy are expected to contribute to lower price growth.
Businesses and households alike experience tighter finances when prices rise in tandem with interest rate hikes. Rapid interest rate increases in the second half of 2022 are expected to reduce the risk of inflation stabilising at an excessively high level. If this is borne out, there will be less need for subsequent base rate hikes by Norges Bank (Norway's central bank). Norges Bank's forecasts assume an increase in the base rate to about 3 per cent over the course of the winter. However, much uncertainty attends the forecasts for inflation and the wider economy, and this will be decisive for interest rate decisions ahead.
For SpareBank 1 SMN's part the risk trend in the corporate portfolio is acceptable. Continued improvement is in evidence in the offshore segment, but increased risk is noted in the wider business sector due to high inflation and higher interest rates. Industries viewed as more exposed than others are construction, retail trade and commercial property. That said, SpareBank 1 SMN is well placed as a driver in a geographical area not affected by high energy costs.
An agreement of intent to merge SpareBank 1 SMN and SpareBank 1 Søre Sunnmøre was signed in June. At meetings of the boards of directors on 3 October the banks adopted a merger plan. Implementation of the plan requires a final decision to be taken by the supervisory boards and general meetings of the respective banks in week 45, and is also conditional on public authority approvals.
The overarching aim of the merged bank is take its place as the leading banking actor in Sunnmøre and in Fjordane. A merged bank will provide greater competitive power, an increased presence and will be attractive to customers, staff and shareholders alike.
The aim is to implement the merger at the start of the second quarter of 2023.
Moody's retained SpareBank 1 SMN's A1 credit rating in October 2022, changing the outlook from stable to positive. Confirmation of the positive outlook reflects SpareBank 1 SMN's solid capital position combined with sound, profitable operations, an improved risk profile and reduced dependence on market funding.
The third quarter net profit was NOK 617m (675m) and return on equity was 10.9 per cent (12.4 per cent). The third quarter profit is NOK 85m lower than in the second quarter of 2022 and is essentially down to weaker results among the subsidiaries in the summer months. The decline compared with last year's third quarter is related to weaker results posted by the insurance companies in SpareBank 1 Gruppen and lower return on financial investments.
Earnings per equity certificate were NOK 2.89 (3.22) and the EC's book value was NOK 107.19 (103.57). In the second quarter of 2022 earnings per EC were NOK 3.20.
Net interest income totalled NOK 811m (707m), which is NOK 10m higher than in the second quarter and NOK 104m better than in the third quarter of 2021. Market interest rates have risen substantially, and NIBOR was 105 points higher in the third quarter of 2022 than in the preceding quarter and 200 points higher than in the third quarter of 2021. This has resulted in lower margins on lending and higher margins on deposits. Increased lending volume and higher return on equity have strengthened net interest income.
Net commission and other income were reduced from the preceding quarter by NOK 205m to NOK 540m (623m). The reduction is essentially due to lower income from securities services after the high income recorded in both the first and second quarter. Estate agency services and accounting services showed, as expected, reduced income in the summer months of July and August.
The group's share of the results of related companies was NOK 109m (179m). The second quarter's profit share was NOK 77m. The decline from the third quarter of 2021 is down to weaker results posted by the insurance companies in SpareBank 1 Gruppen. Part of the insurers' profit impairment relates to losses on securities in an unsettled market.
Return on financial instruments (incl. dividends) amounted to NOK 39m (69m), and in the second quarter to minus NOK 32m.
Operating expenses were NOK 688m (698m) compared with NOK 758m in the second quarter. The decline from the second quarter is mainly attributable to lower variable remuneration at SpareBank 1 Markets following a strong second quarter. Expenses at the bank rose from the second to the third quarter as a result of new staff appointments and the year's pay settlement.
Losses on loans and guarantees came to NOK 22m (31m) in the third quarter, as compared with a net recovery of NOK 48m in the second quarter.
Good growth is noted in lending and deposits in the last 12 months, although deposits showed some decline in the third quarter. Overall lending rose 8.8 per cent (7.0 per cent) and deposits rose 9.9 per cent (15.0 per cent) in the last 12 months. In the third quarter lending growth was 1.7 (1.6) per cent and deposit growth minus 2.6 per cent (minus 0.4 per cent). Growth in lending to personal customers was 1.3 per cent, down from the previous quarter, while lending to corporate customers rose 2.4 per cent, also slightly down from the second quarter. Deposits were reduced in the third quarter both in the personal market and corporate market following high growth in the second quarter.
As at 30 September 2022 the CET1 ratio was 19.2 per cent (18.1 per cent), an increase of 0.4 percentage points from the previous quarter. The bank's CET1 target ratio is 17.2 per cent.
The price of the bank's equity certificate (MING) at quarter-end was NOK 111.40 (129.80).
Norges Bank raised its base rate to 1.75 per cent in August and further to 2.25 per cent in September. Market rates in terms of NIBOR have risen substantially and stood at 2.80 per cent at the end of September. The bank has raised its mortgage and deposit rates in step with the changes in the base rate. After the base rate hike in August, rate increases were carried out with effect from 4 October, and, following the base rate hike in September, increases were announced with effect from 10 November. NIBOR climbed 105 points from the second to third quarter and has risen 200 points since the third quarter of 2021.
Net interest income totalled NOK 811m (707m) compared with NOK 801m in the second quarter. Lags in interest rate adjustments related to the required period of notice of rate changes to customers resulted in reduced lending margins in the third quarter at the same time as deposit margins rose.
An increased deposit margin, growth in lending and higher return on equity strengthened net interest income in the third quarter while reduced lending margins pulled in the opposite direction. This is also the key reason for the change compared with the same quarter of 2021.
Norges Bank has signalled a further increase in the base rate, and the central bank's own forecast indicates a base rate of 3.0 per cent in the course of the winter. Quickening inflation is the chief contributor to higher base rates. Many factors are involved, and the forecasts for the economy and inflation are uncertain.
Commission income and other operating income totalled NOK 540m (623m) compared with NOK 745m in the second quarter of 2022.
A high proportion of multi-product customers makes for high customer satisfaction and a diversified income flow for the group.
| Commission income (NOKm) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| Payment transfers | 83 | 72 | 61 |
| Creditcard | 16 | 15 | 14 |
| Saving products | 9 | 10 | 17 |
| Insurance | 60 | 59 | 54 |
| Guarantee commission | 15 | 8 | 13 |
| Real estate agency | 105 | 125 | 107 |
| Accountancy services | 115 | 167 | 114 |
| Markets | 57 | 198 | 110 |
| Other commissions | 12 | 9 | 7 |
| Commissions ex SB1 Boligkreditt and SB1 Næringskreditt | 473 | 664 | 497 |
| Commissions SB1 Boligkreditt | 63 | 77 | 123 |
| Commissions SB1 Næringskreditt | 4 | 4 | 3 |
| Total commissions | 540 | 745 | 623 |
Commission income on loans sold to SpareBank 1 Boligkreditt and SpareBank 1 Næringskreditt altogether totalled NOK 67m (126m). In the second quarter of 2022 commissions came to NOK 81m. The decline from last year is down to reduced margins on loans sold to SpareBank 1 Boligkreditt.
Other commission income amounted to NOK 473m (497m) compared with NOK 664m in the second quarter. The decline of NOK 191m from the second quarter refers mainly to reduced income from securities services at SpareBank 1 Markets following a good second quarter, and a decline in real estate agency and accounting services due to seasonally low income in the summer months. Income from payment services has picked up in 2022 after the pandemic.
Overall return on financial investments in the third quarter came to NOK 31m (68m), and in the second quarter 2022 to minus NOK 36m. A decline of NOK 66m in share values was noted (gain of NOK 36m), referring largely to shareholdings at SpareBank 1 SMN Invest. Financial instruments, including bonds and CDs, showed a gain of NOK 41m in the third quarter (gain of NOK 14m) ascribable to gains on derivatives in connection with the bank's funding, and losses due to increased credit margins on the bank's liquidity portfolio. Income of NOK 30m (16m) from forex transactions refers to income from currency trading at SpareBank 1 Markets. Gains on shares and share derivatives at SpareBank 1 Markets totalled NOK 26m (2m).
| Return on financial investments (NOKm) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| Capital gains/losses shares | -66 | -35 | 36 |
| Gain/(loss) on financial instruments | 41 | -82 | 14 |
| Foreign exchange gain/(loss) | 30 | 29 | 16 |
| Gain/(loss) on shares and share derivatives at SpareBank 1 Markets | 26 | 52 | 2 |
| Net return on financial instruments | 31 | -36 | 68 |
The product companies provide SpareBank 1 SMN with a broad product range and commission income along with return on invested capital. The overall profit share from the product companies and other related companies was NOK 109m (179m). In the second quarter the figure was NOK 77m.
| Income from investment in associated companies (NOKm) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| SpareBank 1 Gruppen (19.5%) | 17 | 16 | 83 |
| SpareBank 1 Boligkreditt (20.9%) | 10 | -4 | 11 |
| SpareBank 1 Næringskreditt (14.9%) | 0 | 2 | -1 |
| BN Bank (35.0 %) | 53 | 47 | 40 |
| SpareBank 1 Kreditt (18.7 %) | 3 | 3 | 10 |
| SpareBank 1 Betaling (20.8%) | -3 | 0 | 0 |
| SpareBank 1 Forvaltning (19.6%) | 10 | 11 | 13 |
| Other companies | 19 | 2 | 23 |
| Income from investment in associated companies | 109 | 77 | 179 |
This company owns 100 per cent of the shares of SpareBank 1 Forsikring, SpareBank 1 Factoring, SpareBank 1 Spleis and Modhi Finance, and 65 per cent of Fremtind Forsikring. The remaining shares of Fremtind are held by DNB.
SpareBank 1 Gruppen's profit after tax for the third quarter 2022 was NOK 207m (621m), and in the second quarter 2022 NOK 142m. Of the post-tax profit of NOK 207m, NOK 89m (425m) accrues to the owner banks in SpareBank 1 Gruppen. The group's share of SpareBank 1 Gruppen's profit was NOK 17m (83m), and in the second quarter 2022 NOK 16m.
Fremtind Group posted a third quarter profit of NOK 390m (559m) after tax. The quarter's underwriting result was NOK 559m (690m) yielding a claims ratio for the quarter of 61.6 per cent (57.2 per cent) and a
cost ratio of 24.1 per cent (23.5 per cent). The increase in the claims ratio is largely due to higher travel activity and a negative outcome for retail market car insurance. Financial income was minus NOK 51m (512m) in the third quarter due to a weak equity market and higher interest rates.
SpareBank 1 Forsikring reported a third quarter 2022 result of minus NOK 105m (72m) after tax. The risk result came to NOK 40m (32m). The administration result was minus NOK 44m (minus 32m). Insurance fee income in the third quarter was NOK 16m lower than in the same quarter last year, due mainly to the introduction of a pension account. The quarter's interest result was minus NOK 462m (99m). Property value adjustment made a negative contribution, and net financial income in the collective portfolio was minus NOK 353m. Return on financial assets in the company portfolio was minus NOK 17m in the third quarter.
SpareBank 1 Factoring earned a profit after tax of NOK 17m (12m). Overall net income came to NOK 44m (29m) corresponding to an increase of 52 per cent measured against the same quarter last year. Activity levels among clients affected by the pandemic have picked up again, bringing an increase in the volume of factoring loans.
Modhi Finance posted a pre-tax profit in the third quarter of minus NOK 3m (15m) and minus NOK 1m (plus 11m) after tax. The result reflects a write-down of portfolio values in the third quarter, whereas last year saw a write-up of portfolio values in the third quarter. The third quarter result also reflects one-time costs related to the merger with the debt collection company Kredinor.
SpareBank 1 Boligkreditt was established by the banks making up SpareBank 1-alliansen to draw benefit from the market for covered bonds. The banks sell well-secured residential mortgages to the company and achieve reduced funding costs.
As at 30 September 2022 the bank had sold residential mortgages totalling NOK 57.1bn (46.7bn) to SpareBank 1 Boligkreditt, corresponding to 40.6 per cent (35.7 per cent) of the bank's overall lending to retail customers.
The bank's share of the company's profit was NOK 10m (11m).
SpareBank 1 Næringskreditt was established along the same lines and with the same administration as SpareBank 1 Boligkreditt. As at 30 September 2022, commercial loans worth NOK 1.6bn (1.3bn) had been sold to SpareBank 1 Næringskreditt.
SpareBank 1 SMN's share of the profit was NOK 0m (-1m).
SpareBank 1 Forvaltning Group consists of Odin Forvaltning, SpareBank 1 Kapitalforvaltning, SpareBank 1 SR Forvaltning and SpareBank 1 Verdipapirservice. The aim is to be market leader in bank distribution of savings services and products. The group posted a profit in third quarter of NOK 49m (54m). SpareBank 1 SMN's profit share in the third quarter was NOK 10m (13m) and in the second quarter NOK 11m. The result is satisfactory in an unsettled market.
SpareBank 1 Kreditt recorded a third-quarter profit of NOK 21.5m (70.4m). The decline is attributable to a substantial reversal of loss write-downs last year. The company's overall portfolio as at 30 September 2022 was NOK 7.2bn (5.7bn). The growth refers in all essentials to refinancing loans.
SpareBank 1 SMN's share of the third quarter 2022 profit was NOK 2.9m (10.1m), and its share of the portfolio is NOK 1,229m (998m).
While BN Bank's personal market business is nationwide in scope, the bank's largest customer base is Oslo and south-eastern Norway. In the corporate market the bank is a pure real estate specialist, with the Oslo region as its market area. BN Bank shows good growth in lending to the personal segment with 12.1 per cent in the last 12 months (14.2 per cent) and growth of 2.3 per cent (3.2 per cent) in the third quarter. Growth in lending to corporate customers was 9.9 per cent in the last 12 months (1.1 per cent) and 2.7 per cent in the last quarter (decline of 2.7 per cent). Outstanding loans total NOK 55bn (50bn).
BN Bank recorded a profit of NOK 154m (117m) in the third quarter, providing a return on equity of 12.5 per cent (9.5 per cent). Lower losses are the main reason for the profit growth. SpareBank 1 SMN's share of BN Bank's profit is NOK 53m (40m).
SpareBank 1 Betaling is the SpareBank 1 banks' parent company in Vipps AS. On 30 June 2021 Vipps signed an agreement to merge Vipps' mobile payments arm with Danish MobilePay and Finnish Pivo, thus opening the way for cross-border mobile payments. In the third quarter 2022, it became known that the merger will take place without Pivo after the European Commission raised concerns related to the consolidation of mobile wallets in Finland. During the quarter, a formal application was submitted to the European Commission and the companies hope to receive approval in the fourth quarter of 2022. In parallel with the merger, BankAxept and BankID are to be spun off from Vipps to become a new Norwegian-owned company which will remain 100 per cent owned by the Norwegian banks.
SpareBank1 Betaling recorded a profit of minus NOK17m (minus 2m), and SpareBank 1 SMN's profit share is minus NOK 3m (0m) in the third quarter.
Overall group expenses came to NOK 688m (698m), a decline of NOK 10m, or 1.4 per cent, compared with the same period of 2021. Overall expenses in the second quarter 2022 were NOK 758m.
| Operating expenses (NOKm) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| Staff costs | 417 | 490 | 423 |
| IT costs | 95 | 93 | 85 |
| Marketing | 18 | 26 | 19 |
| Ordinary depreciation | 32 | 34 | 56 |
| Operating expenses, real properties | 18 | 9 | 14 |
| Purchased services | 63 | 54 | 60 |
| Other operating expense | 45 | 52 | 41 |
| Total operating expenses | 688 | 758 | 698 |
The decline in group expenses in the third quarter refers in all essentials to lower variable remuneration at SpareBank 1 Markets. The company showed a decline in income compared with the preceding quarter and the same quarter last year and thus reduced variable remuneration.
Compared with the third quarter 2021, some cost growth is noted at SpareBank 1 Regnskapshuset SMN related to company acquisitions, and at the bank as a result of the year's pay settlement and new staff appointments. The same factors underlie cost growth at the bank from the second quarter.
The cost-income ratio for the group was 46 per cent (44 per cent), and 36 per cent (37 per cent) for the parent bank.
Loan losses were NOK 22m (31m) and the second quarter saw a net recovery of NOK 48m. Losses in the quarter measure 0.04 per cent of gross lending (0.07 per cent).
| Impairment losses (NOKm) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| RM | 17 | -4 | 3 |
| CM | 5 | -44 | 28 |
| Total impairment losses | 22 | -48 | 31 |
Losses on loans to personal customers were NOK 17m (3m), while losses on loans to corporates came to NOK 5m (28m).
The effects of the Covid pandemic on defaults and losses proved substantially smaller than expected, due in part to the actions taken by public authorities. The bank accordingly decided to reverse the Covid-related add-ons in the baseline scenario in the third quarter 2021 for the retail market and in the first quarter 2022 for the corporate market. In the second and third quarters of 2022, changes have been made to model assumptions to take account of increased risk as a result of increased interest rates, increased expected defaults and lower property values.
In the third quarter of 2022 the weighting of the downside scenario was also increased at the subsidiary SpareBank 1 SMN Finans Midt-Norge from 10 to 25 per cent for the corporate business and from 10 to 15 per cent for the retail business. See note 2 for further details of the changed assumptions.
Overall write-downs on loans and guarantees total NOK 1,199m (1,680m).
Problem loans (Stage 3) amount to NOK 2,139m (3,448m) corresponding to 1.02 per cent (1.80 per cent) of gross outstanding loans, including loans sold to SpareBank 1 Boligkreditt and SpareBank 1 Næringskreditt. A significant portion of the decline is due to the fact that a large offshore exposure has completed its quarantine period, and to the downscaling of the bank's exposure in another offshore commitment due to vessel sales. This took place in the second quarter of 2022.
The group's total assets amounted to NOK 219bn (200bn), having risen by NOK 19bn, or 9.4 per cent, in the past year. Total assets have risen as a result of higher lending volumes and a higher liquidity holding.
Loans totalling NOK 59bn (48bn) have been sold from SpareBank 1 SMN to SpareBank 1 Boligkreditt and to SpareBank 1 Næringskreditt. These loans do not figure as loans in the bank's balance sheet. The comments covering lending growth take into account loans sold to SpareBank 1 Boligkreditt and SpareBank 1 Næringskreditt.
Total outstanding loans rose in the last 12 months by NOK 16.9bn (12.6bn), or 8.8 per cent (7.0 per cent), to reach NOK 208.9bn (192.0bn). Growth in the third quarter was 1.7 per cent (1.6 per cent).
Good, but somewhat receding, growth is noted in lending to personal customers. The growth in lending over time has exceeded the growth in credit to households (C2), and the group is strengthening its market position. The growth in lending to corporate clients is mainly to small and medium-sized businesses throughout the market area. The growth is distributed across a number of industries, and industry and singlename concentrations are avoided.
(For distribution sector, see note 5).
Customer deposits rose in in the last 12 months by NOK 10.9bn (14.3bn) to NOK 120.6bn (109.7bn). This represents a growth of 9.9 per cent (15.0 per cent). Growth in the third quarter was minus 2.6 per cent (decline of 0.4 per cent).
Deposit growth has been very high in the last two years owing to the pandemic but has normalised in 2022. Decline in deposits from private customers are mainly due to increased consumption in the summer months. Deposits from business customers has also decreased in the third quarter, and is considered to be within normal fluctuations. The bank has made plans to strengthen deposit growth within the retail market. Deposit coverage within the retail market is lower than desired, while deposits are an important source of funding for the bank.
(For distribution by sector, see note 9).
The Personal Banking Division and EiendomsMegler 1 Midt-Norge offer private individuals a broad range of financial services. Constant improvement of the coordination between the bank and the real estate agency business affords customers an enhanced service offering and contributes to increased growth and profitability for the group.
| Result before tax (NOKm) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| Personal market | 322 | 329 | 311 |
| EiendomsMegler 1 | 12 | 38 | 8 |
| Total | 335 | 367 | 319 |
The Personal Banking Division achieved a pre-tax profit of NOK 322m (311m), and NOK 329m in the previous quarter. Return on capital employed was 14.7 per cent (13.8 per cent) in the quarter.
Loans granted by the Personal Banking Division total NOK 145bn (135bn) and deposits total NOK 54bn (50bn). These are loans to and deposits from wage earners, agricultural customers and sole proprietorships.
Overall operating income came to NOK 575m (539m), and to NOK 541 in the previous quarter. Net interest income accounted for NOK 367m (300m) and for NOK 335m in the second quarter.
Net interest income rose compared with the third quarter of 2021 as a result of growth, a strengthened deposit margin and increased return on the personal market's share of the group's equity capital, while lower margins on lending have weakened net interest income. Commission income was NOK 208m (239m) and NOK 206m in the previous quarter. Incomes have declined compared with the third quarter of 2021 due to lower commisions from SpareBank 1 Boligkreditt, while there is increased income from insurance and payment services.
The lending margin was 0.39 per cent (1.57 per cent), and in the second quarter of 2022 1.08 per cent. The deposit margin was 1.67 per cent (0.06 per cent), and 0.78 per cent in the previous quarter (measured against three-month NIBOR). The market interest rate (measured against three-month NIBOR) rose from the second quarter of 2022 by 105 points, thereby weakening the lending margin but strengthening the deposit margin in the third quarter.
Growth in lending to and deposits from retail customers was 7.5 per cent (6.6 per cent) and 9.1 per cent (4.9 per cent) respectively in the last 12 months. In the third quarter growth in lending and deposits was 1.3 per cent (1.8 per cent) and minus 2.5 per cent (minus 2.7 per cent) respectively.
Lending to personal customers consistently carries low risk, as reflected in continued low losses. The loan portfolio is largely secured by residential property. Loan losses of NOK 11m in the third quarter (loss of minus 1m) are due mainly to write-downs in the agriculture segment of the portfolio.
| Profit and loss account (NOKm) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| Net interest | 367 | 335 | 300 |
| Comission income and other income | 208 | 206 | 239 |
| Total income | 575 | 541 | 539 |
| Total operating expenses | 241 | 215 | 230 |
| Ordinary operating profit | 334 | 326 | 310 |
| Loss on loans, guarantees etc. | 11 | -2 | -1 |
| Result before tax including held for sale | 322 | 329 | 311 |
| Balance | |||
| Loans and advances to customers | 145,433 | 143,544 | 135,344 |
| Adv.of this sold to SB1 Boligkreditt and SB1 Næringskreditt | -57,299 | -55,464 | -46,687 |
| Deposits to customers | 54,458 | 55,829 | 49,909 |
| Key figures | |||
| Return on equity per quarter 1) | 14.7 % | 13.5 % | 13.8 % |
| Lending margin | 0.39 % | 1.08 % | 1.57 % |
| Deposit margin | 1.67 % | 0.78 % | 0.06 % |
1) Calculation of capital employed in Retail Banking and Corporate Banking is based on regulatory capital in accordance with the capital plan.
Eiendomsmegler 1 Midt-Norge is the market leader in Trøndelag and in Møre and Romsdal. Operating income totalled NOK 107m (108m) and operating expenses NOK 95m (100m). EiendomsMegler 1 Midt-Norge's pre-tax profit was NOK 12m (8m). The number of dwelling units on the market has increased since the summer, and as per September is higher than at the same point last year. At the same time there are signs that inflation and increased mortgage interest rates are affecting the demand side. When adjusted for seasonal variations, the price change in September was minus 0.5 per cent in Trondheim and minus 0.6 per cent on a nationwide basis. Activity levels ahead are a matter of much uncertainty viewed in light of a continuing rise in interest rates and what affect this will have on the market.
1,761 dwelling units were sold in the third quarter (1,919). New assignments numbered 1,956 – 38 fewer than in the third quarter of 2021. The company's market share as at 30 September 2022 was 36 per cent (36 per cent).
| EiendomsMegler 1 Midt-Norge (87%) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| Total income | 107 | 134 | 108 |
| Total operating expenses | 95 | 96 | 100 |
| Result before tax (NOKm) | 12 | 38 | 8 |
| Operating margin | 11 % | 28 % | 8 % |
The corporate business at SpareBank 1 SMN consists of the bank's corporate banking arm, SpareBank 1 Regnskapshuset SMN, SpareBank 1 Finans Midt-Norge and SpareBank 1 Markets. These business lines provide business and industry with a complete range of banking and capital market services. Interaction between the business lines has a high priority and part of the growth achieved is ascribed to this focus.
| Result before tax (NOKm) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| Corporate banking | 322 | 361 | 200 |
| SpareBank 1 Regnskapshuset SMN (88.7%) | 22 | 30 | 21 |
| SpareBank 1 Finans Midt-Norge (56.5%) | 44 | 50 | 33 |
| SpareBank 1 Markets (66.7%) | 0 | 79 | 23 |
| Total | 388 | 521 | 277 |
The Corporate Banking Division achieved a pre-tax profit of NOK 322m (NOK 200m), and NOK 361m in the second quarter of 2022. The profit growth from last year is attributable to increased income and low losses. Return on capital employed was 18.4 per cent (11.6 per cent).
Outstanding loans to the bank's corporate customers total NOK 52bn (47bn) and deposits total NOK 63bn (59bn) as at 30 September 2022. This is a diversified portfolio of loans to and deposits from corporate clients in Trøndelag and Møre and Romsdal.
Operating income came to NOK 436m (334m), and NOK 420m in the second quarter of 2022. Net interest income was NOK 361m (273m), and NOK 356m in the second quarter. A high proportion of the loans are linked to three-month NIBOR, thereby contributing to a stable margin trend over time. Margins on these loans taken as a whole will however fluctuate between quarters given differing times of interest rate adjustment on the loans. An increase in NIBOR brought reduced lending margins in the quarter, but
increased deposit margins. Increased loan and deposit volumes have strengthened the earnings base at the same time as increased return on the business line's share of the equity capital has strengthened net interest income both from the second to third quarter and compared with last year's third quarter.
Commission income totalled NOK 75m (61m) compared with NOK 64m in the second quarter, and income from guarantees and payment services has risen from the previous quarter.
Loan and deposit margins were 2.05 per cent (2.60 per cent) and minus 0.27 per cent (minus 0.31 per cent) respectively. Lending rose 11.1 per cent (7.2 per cent) and deposits 6.2 per cent (27.2 per cent) in the last 12 months. Lending growth was 1.7 per cent (minus 0.2 per cent) while deposit growth was minus 2.8 per cent (growth of 2.3 per cent) in the quarter.
Losses on loans to the bank's corporate customers were NOK 1m (25m), and a net recovery of NOK 51m was recorded in the second quarter.
SpareBank 1 SMN and SpareBank 1 Regnskapshuset SMN each have a large proportion of businesses in the market area as customers. Developing the customer offering so as to encourage customers to see the benefits of utilising the services of both entities is given priority.
As a result of the strengthened focus on SMEs, many new customers have opted for SpareBank 1 SMN as their bank in 2022 and 2021. Corporate customers have strong links with the bank and customer churn is extremely low.
| Profit and loss account (NOKm) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| Net interest | 361 | 356 | 273 |
| Comission income and other income | 75 | 64 | 61 |
| Total income | 436 | 420 | 334 |
| Total operating expenses | 114 | 109 | 109 |
| Ordinary operating profit | 322 | 311 | 225 |
| Loss on loans, guarantees etc. | 1 | -51 | 25 |
| Result before tax including held for sale | 322 | 361 | 200 |
| Balance | |||
| Loans and advances to customers | 52,047 | 51,193 | 46,857 |
| Adv.of this sold to SB1 Boligkreditt and SB1 Næringskreditt | -1,354 | -1,359 | -1,237 |
| Deposits to customers | 62,638 | 64,415 | 59,006 |
| Key figures | |||
| Return on equity per quarter 1) | 18.4 % | 18.5 % | 11.6 % |
| Lending margin | 2.05 % | 2.53 % | 2.60 % |
| Deposit margin | -0.27 % | -0.05 % | -0.31 % |
1) Calculation of capital employed in Retail Banking and Corporate Banking is based on regulatory capital in accordance with the capital plan.
SpareBank 1 Regnskapshuset SMN recorded a pre-tax profit of NOK 22m (21m).
Operating income was NOK 125m (122m) and expenses were NOK 103m (101m). Three company acquisitions were carried through in 2022.
Increased organic customer growth has a high priority, and good results have been achieved in 2022. Customer recruitment has risen, at the same time as the company has succeeded in reducing customer churn. The company seeks to create a broader income platform beyond the traditional production of accounts.
Digitalisation and use of new technological solutions in business and industry places heavy requirements on the accounting industry in terms of readjustment and adaptability. This applies both as regards increasing the individual employee's skills and achieving greater breadth in the service offering to customers.
Income from advisory services has risen by 19 per cent in the last 12 months while 600 companies have relocated to modern, cloud-based accounting systems as of 30 September 2022.
The company's market share in Trøndelag, Møre and Romsdal and Gudbrandsdal is 25 per cent.
| SpareBank 1 Regnskapshuset SMN (88.7%) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| Total income | 125 | 177 | 122 |
| Total operating expenses | 103 | 147 | 101 |
| Result before tax (NOKm) | 22 | 30 | 21 |
| Operating margin | 17 % | 17 % | 18 % |
SpareBank 1 Finans Midt-Norge delivered a pre-tax profit of NOK 44m (33m). The company's focal areas are leasing to SMEs, car loans to personal customers and invoice purchases from small businesses.
The company's income totalled NOK 83m (89m). Income is weakened due to margin pressures in the corporate and personal market alike. Costs in the third quarter of 2022 were NOK 28m (49m). The decrease compared to the third quarter of 2021 is mainly due to the write-down of IT systems carried out last year. Losses totalled NOK 10m (7m).
The company has leasing agreements with and loans to corporate customers worth NOK 4.9bn (4.1bn) and car loans worth NOK 6.8bn (5.9bn).
SpareBank 1 Finans Midt-Norge and other SpareBank 1 banks own 47 per cent of the shares of the car subscription company Fleks. This company offers flexible car subscription solutions. The car subscription system along with electrification of the car population make for reduced emissions. Fleks currently has 2,500 cars and is the market leader in Norway.
| SpareBank 1 Finans Midt-Norge (56.5%) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| Total income | 83 | 81 | 89 |
| Total operating expenses | 28 | 26 | 49 |
| Loss on loans, guarantees etc. | 10 | 5 | 7 |
| Result before tax (NOKm) | 44 | 50 | 33 |
SpareBank 1 Markets is headquartered in Oslo and has offices in Trondheim, Ålesund and Stavanger. It employs 163 FTEs.
SpareBank 1 Markets' pre-tax profit was NOK 0m (23m).
Activity levels in the business areas were lower than at the start of the year. Public issue management business was very quiet in the quarter due to market turbulence, resulting in lower income for Investment Banking and stockbroking. Income from fixed income and forex activities and debt capital was stable. Overall income came to NOK 110m (139m). Operating expenses totalled NOK 110m (115m).
SpareBank 1 Markets has developed into one of the largest Norwegian brokerages with a strong position in a number of product areas, and is the leading capital markets unit in SpareBank 1 SMN's market area. The foreshadowed transaction entailing the merger of the capital markets units of SpareBank 1 Markets,
SpareBank 1 SR-Bank and SpareBank 1 Nord-Norge is expected to contribute to a higher and more diversified income base. The merger is currently scheduled for 1 March 2023, but this is dependent on the authorities' process.
| SpareBank 1 Markets (66.7%) | 3Q 22 | 2Q 22 | 3Q 21 |
|---|---|---|---|
| Total income | 110 | 257 | 139 |
| Total operating expenses | 110 | 178 | 115 |
| Result before tax (NOKm) | 0 | 79 | 23 |
| Operating margin | 0 % | 31 % | 17 % |
This company owns shares in regional businesses. The portfolio is managed together with other long-term shareholdings of the bank and will be scaled down. The company's shares are worth NOK 604m (606m) as at 30 September 2022.
The company's pre-tax profit in the third quarter of 2022 was minus NOK 30m (plus 61m), and in the second quarter minus NOK 29m. The third quarter result – as in the second quarter – is down to net unrealised losses in the equity portfolio.
SpareBank 1 SMN reports a post-tax profit of NOK 2,017m (2,199m), and a return on equity of 12.0 per cent (13.8 per cent). This result is NOK 182m weaker than in the same period of 2021, mainly due to profit impairments among the insurers in SpareBank 1 Gruppen and lower return on financial investments. Increased income from the business lines and reduced losses helped to strengthen the result. Earnings per equity certificate were NOK 9.29 (10.11).
Net interest income was NOK 2,370m (2,073m). Norges Bank raised the base rate to 1.75 per cent in August and further to 2.25 per cent in September. The market interest rate in terms of NIBOR was 200 points higher on 30 September than on the same date in 2021, which has substantially raised the bank's funding costs. Lending margins have weakened and deposit margins have concurrently strengthened compared with last year, at the same time as return on the bank's equity capital has risen. Both lending and deposit volumes have increased, contributing to strengthened net interest income. From the second half of last year the bank has raised mortgage and deposit rates on a general basis on six occasions, including an announced increase effective from 10 November.
Net commission income was NOK 1,921m (2,161m). The decline is ascribable to lower commission on loans sold to SpareBank 1 Boligkreditt and reduced income from securities services. A positive trend is noted in income from payment services, insurance and accounting services.
Return on financial investments (including dividends) was NOK 179m (289m). The decline refers to unrealised losses on shares and negative return on the bank's liquidity portfolios due to changed credit margins.
The result from related companies was NOK 248m (519m). Both Fremtind Forsikring and SpareBank 1 Forsikring report impaired profit, while profit growth was noted at BN Bank.
Operating expenses came to NOK 2,208m (2,228m). Expenses are down at SpareBank 1 Markets and EiendomsMegler 1 Midt-Norge but have risen at the bank and at SpareBank 1 Regnskapshuset SMN. Expenses at the bank have risen as a result of pay growth and new staff appointments, at Regnskapshuset as a result of acquisitions and investments in technology.
A net recovery of NOK 26m was recorded on loan losses (loss of NOK 129m) as at 30 September. A net recovery of NOK 39m was noted on losses on loans to the group's corporate customers (132m), while NOK 14m, net, was recovered on loan losses to personal customers (net recovery of NOK 3m).
Lending growth was 6.9 per cent (5.0 per cent). Growth in lending to retail customers was 5.7 per cent (5.1 per cent). Lending to corporate customers rose 9.6 per cent (4.8 per cent).
Deposits rose 8.3 per cent (12.5 per cent). Deposits from personal customers rose 6.9 per cent (8.3 per cent). Deposits from corporate customers rose 9.3 per cent (15.5 per cent).
| Result before tax (NOKm) | Jan-Sep 2022 | Jan-Sep 2021 |
|---|---|---|
| Personal market | 924 | 880 |
| EiendomsMegler 1 | 64 | 71 |
| Total | 989 | 951 |
The bank's personal banking arm recorded a pre-tax profit of NOK 924m (880m) as at 30 September 2022. Return on capital employed in the retail segment was 14.0 per cent (13.0 per cent).
Overall operating income totalled NOK 1,631m (1,542m). Net interest income came to NOK 1,015m (859m) and commission income to NOK 616m (684m). Net interest income has risen with increased deposit margins, growth in lending and deposits and increased return on the business line's share of the equity capital. Reduced margins on loans have reduced net interest income. Commission income is down mainly as a result of lower commissions from SpareBank 1 Boligkreditt.
Lending and deposit growth in this business line were 7.5 per cent (6.6 per cent) and 9.1 per cent (4.9 per cent) respectively in the last 12 months.
The lending margin was 0.83 per cent (1.63 per cent) while the deposit margin was 1.06 per cent (0.02 per cent) measured against three-month NIBOR.
There was a net loss of NOK 2m (net recovery of NOK 11m).
EiendomsMegler 1 Midt-Norge. Operating income was NOK 336m (353m), while operating expenses came to NOK 271m (282m). EiendomsMegler 1 Midt-Norge's pre-tax profit was NOK 64m (71m). Activity in 2022 reflects a housing market with few dwellings available, which has pushed up both the turnover rate and prices. The consequence is a lower sales volume for EiendomsMegler 1 Midt-Norge so far this year, i.e. 5,400 as against 5,995 in the same period of 2021.
| Corporate customers | ||
|---|---|---|
| Result before tax (NOKm) | Jan-Sep 2022 | Jan-Sep 2021 |
| Corporate banking | 959 | 566 |
| SpareBank 1 Regnskapshuset SMN (88.7%) | 76 | 82 |
| SpareBank 1 Finans Midt-Norge (56.5%) | 141 | 151 |
| SpareBank 1 Markets (66.7%) | 119 | 203 |
| Total corporate customers | 1,295 | 1,002 |
The bank's corporate banking arm achieved a pre-tax profit of NOK 959m (566m) as at 30 September 2022. The profit growth is attributable to increased net interest income and lower losses. Return on capital employed for the corporate segment was 18.6 per cent (11.1 per cent).
Operating income totalled NOK 1,260m (1,016m), of which net interest income accounted for 1,047m (828m) and commission income (incl. income from forex business) for NOK 213m (188m). Growth in lending and deposits, an increased deposit margin and increased return on the banking arm's share of the equity capital have strengthened net interest income, while a lower lending margin pulls in the opposite direction. Increased commission income is noted on guarantees and payments.
Lending grew 11.1 per cent (8.7 per cent) and deposits 6.2 per cent (27.2 per cent) in the last 12 months.
Margins on lending and deposits were 2.32 per cent (2.69 per cent) and 0.05 per cent (minus 0.32 per cent) respectively.
There was an overall net recovery of NOK 47m on losses in the bank's corporate segment (loss of NOK 125m).
SpareBank 1 Finans Midt-Norge report a pre-tax profit of NOK 141m (151m).
The company's income totalled NOK 243m (271m). Expenses in the year to 30 September 2022 were NOK 83m (106m). Losses amounted to NOK 20m (13m).
SpareBank 1 Regnskapshuset SMN posted a pre-tax profit of NOK 76m (82m). Operating income was NOK 468m (439m) while expenses came to NOK 392m (357m).
SpareBank 1 Markets' pre-tax profit was NOK 119m (203m). High activity in the business lines has yielded high earnings and good profit performances both in 2021 and 2022.
So far this year the company's income amounts to NOK 545m (689m), NOK 144m lower than the same period in 2021.
Price growth continued to quicken both in Norway and elsewhere in the third quarter. Central banks in a number of countries raised their base rates and signalled a speedier rate increase ahead. Uncertain growth and inflation prospects internationally have contributed to substantial fluctuations in financial markets. Credit spreads have widened.
The bank has ample liquidity and access to funding. The bank has a conservative liquidity strategy, with liquidity reserves that ensure the bank's survival for 12 months of ordinary operation without need of fresh external funding.
The bank is required to maintain sufficient liquidity buffers to withstand periods of limited access to market funding. The liquidity coverage ratio (LCR) measures the size of banks' liquid assets relative to net liquidity outflow 30 days ahead given a stressed situation.
The LCR is calculated at 180 per cent as at 30 September 2022 (163 per cent). The requirement is 100 per cent.
The group's deposit-to-loan ratio at 30 September 2022, including SpareBank 1 Boligkreditt and SpareBank 1 Næringskreditt, was 58 per cent (57 per cent).
The bank's funding sources and products are well diversified.
SpareBank 1 Boligkreditt and Næringskreditt are important funding sources for the bank, and loans totalling NOK 59bn (48bn) had been sold to these mortgage companies as at 30 September 2022. Thus far in 2022 residential mortgages totalling NOK 10.4bn have been sold to SpareBank 1 Boligkreditt.
In the third quarter the bank issued a senior green bond worth EUR 0.5bn and senior non-preferred debt (MREL) worth NOK 1.6bn.
As at 30 September 2022 SpareBank 1 SMN had issued senior non-preferred debt (MREL) in an amount of NOK 7.1bn. SpareBank 1 SMN will meet the MREL requirements by the end of 2023.
The bank has a rating of A1 (positive outlook) with Moody's.
The CET1 ratio at 30 September 2022 was 19.2 per cent (18.1 per cent). The requirement is 14.9 per cent, including combined buffer requirements and a Pillar 2 requirement of 1.9 per cent. Finanstilsynet (Norway's FSA) set a new Pillar 2 requirement for SpareBank 1 SMN on 30 April 2022. The rate of 1.9 per cent is unchanged, but the bank is subject to a temporary add-on of 0.7 per cent to its Pillar 2 requirement pending consideration of its application for adjustment of its IRB models.
Finanstilsynet has decided that SpareBank 1 SMN is to be subject to a Pillar 2 guidance of 1.25 per cent over and above its overall capital requirement. The bank's long-term CET1 target ratio is accordingly raised to 17.2 per cent.
The CET1 ratio showed a 0.4 percentage point increase from the second quarter. Risk weighted assets rose 1.4 per cent in the third quarter. A good profit performance and basis swap effects from SpareBank 1 Boligkreditt are the main explanation for the 3.7 per cent increase in CET1 capital. Value changes on base swaps i SpareBank 1 Boligkreditt will reverse over the term of the derivative. A payout ratio of 50 per cent of the group' net profit for 2022 is assumed.
A leverage ratio of 7.3 per cent (6.9 per cent) shows the bank to be very solid.
Sustainability is one of five strategic priorities in the group strategy, and the group's sustainability strategy stands firm.
Over the course of the quarter SpareBank 1 SMN has elucidated the content of the group's long-term climate ambition. This has involved clarifying work processes and frameworks, and the drawing up of plans for the transition to net zero emissions at industry level with a view to making an active contribution to an organised readjustment to a low-emissions society. In order to realise the ambition, milestones are drawn up. This and the status of transition plans will be communicated during the fourth quarter.
Calculating the loan portfolio's emissions is still a matter of much uncertainty. This is mainly due to data quality and access to relevant data from our customers. The uncertainty is naturally greater the longer the time perspective we apply. The group has nonetheless estimated emission paths for the period to 2050 utilising Science Based Target Initiatives as a basis for setting sectoral emissions reduction targets for the path towards net zero emissions in 2050.
The group will continue its work to develop data and methodology and will revise the group's materiality analysis in the fourth quarter.
The book value of the equity certificate (EC) as at 30 September 2022 was NOK 107.19 (103.57), and earnings per EC were NOK 9.29 (10.11).
The Price / Income ratio was 9.00 (9.62) and the Price / Book ratio was 1.04 (1.25).
SpareBank 1 SMN delivered a good performance as per 30 September 2022 with a return on equity of 12 per cent and good capitalisation. This is viewed as satisfactory in a situation of much market unrest. The business lines have performed well and the group has a solid basis on which to attain its ambitions for growth and profitability. The ROE objective of a minimum of 12 per cent and other key financial targets stand firm.
Rising market interest rates and price growth impact the personal and corporate market alike and contribute to increased uncertainty. The risk trend in the loan portfolio is acceptable, and loan losses are low. The offshore segment continues to improve, although there are signs of increased risk elsewhere in business and industry. The region enjoys low energy prices and unemployment remains very low.
Greater uncertainty attends house prices and expectations of receding credit growth. Interest rate hikes and growth in prices will reduce households' purchasing power and consumption. Thus far there are few signs of increased risk in the personal customer portfolio, but the expectation is that more customers will be in need of flexible solutions and financial advice in the period ahead. The bank is well prepared to handle this situation through its customer relationship concept and physical presence in Trøndelag and in Møre and Romsdal.
SpareBank 1 SMN is a full-fledged finance centre, it leads the field in its market area and has a broadbased product platform with profitable subsidiaries and product companies. Good results have been achieved in 2022 along with broad growth and a strengthened market position. However, macroeconomic prospects are uncertain. The ambition to further strengthen the group's market position nonetheless stands firm. This is underpinned by a modern, customer-oriented and effective distribution system. The merger with SpareBank 1 Søre Sunnmøre has been approved by both banks' boards of directors and presented for a final decision by the banks' general meetings and supervisory boards in November. The merger will make for an improved customer offering and a stronger presence in Sunnmøre and in Fjordane.
SpareBank 1 SMN has set itself the goal of achieving net zero carbon emissions from the group's customer portfolios and day-to-day operations by 2050 at the latest. The bank has started work on establishing
transitional plans for reduced emissions from the group's customer portfolios as well as plans for reduction of its own emissions. In addition priority is given to developing competence, data quality and climate reporting.
The uncertainty in the economy is greater than for a long time both nationally and internationally. A strong capital position, ample liquidity and access to funding put SpareBank 1 SMN in an good position to manage the uncertainty.
| Kjell Bjordal (chair) |
Christian Stav (deputy chair) |
Morten Loktu |
|---|---|---|
| Mette Kamsvåg | Tonje Eskeland Foss | Eli Skrøvset |
| Freddy Aursø | Inge Lindseth (employee rep.) |
Christina Straub (employee rep.) |
Jan-Frode Janson (Group CEO)
Page 23 of 67
| Parent bank | Group | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| January - | January - | ||||||||||
| Third quarter | September | September | Third quarter | ||||||||
| 2021 | 2021 | 2022 | 2021 | 2022 (NOKm) | Note | 2022 | 2021 | 2022 | 2021 | 2021 | |
| 3,067 | 767 | 1,220 | 2,240 | 3,163 Interest income effective interest method | 3,513 | 2,584 | 1,341 | 883 | 3,524 | ||
| 395 | 91 | 181 | 287 | 450 Other interest income | 448 | 285 | 180 | 90 | 392 | ||
| 1,109 | 263 | 705 | 788 | 1,576 Interest expenses | 1,591 | 796 | 710 | 266 | 1,120 | ||
| 2,353 | 595 | 697 | 1,739 | 2,037 Net interest | 10 | 2,370 | 2,073 | 811 | 707 | 2,796 | |
| 1,306 | 340 | 307 | 969 | 909 Commission income | 1,102 | 1,179 | 369 | 405 | 1,583 | ||
| 97 | 27 | 25 | 69 | 66 Commission expenses | 163 | 152 | 60 | 54 | 207 | ||
| 47 | 9 | 17 | 31 | 36 Other operating income | 982 | 1,134 | 230 | 272 | 1,456 | ||
| 1,256 | 321 | 298 | 930 | 880 Commission income and other income | 11 | 1,921 | 2,161 | 540 | 623 | 2,832 | |
| 733 | 2 | 3 | 713 | 584 Dividends | 13 | 21 | 8 | 1 | 22 | ||
| Income from investment in related | |||||||||||
| - | - | - | - | - | companies 3 |
519 | 109 | 179 | 705 | ||
| -53 | 15 | 29 | -13 | -92 Net return on financial investments | 166 | 267 | 31 | 68 | 299 | ||
| 680 | 17 | 32 | 700 | 491 Net return on financial investments | 248 | 1,026 | |||||
| 4,289 | 933 | 1,027 | 3,369 | 3,408 Total income | 4,718 | 5,042 | 1,499 | 1,578 | 6,655 | ||
| 650 | 169 | 179 | 487 | 505 Staff costs | 1,383 | 1,419 | 417 | 423 | 1,882 | ||
| 745 | 176 | 190 | 540 | 580 Other operating expenses | 12 | 825 | 809 | 271 | 275 | 1,111 | |
| 1,395 | 345 | 369 | 1,027 | 1,086 Total operating expenses | 2,208 | 2,228 | 688 | 698 | 2,993 | ||
| 2,895 | 588 | 658 | 2,342 | 2,322 Result before losses | 2,511 | 2,814 | 810 | 880 | 3,662 | ||
| 134 | 24 | 12 | 115 | -45 Loss on loans, guarantees etc. | 6,7 | -26 | 129 | 22 | 31 | 161 | |
| 2,760 | 564 | 646 | 2,228 | 2,367 Result before tax | 3 | 2,536 | 2,685 | 788 | 849 | 3,501 | |
| 518 | 155 | 159 | 387 | 438 Tax charge | 520 | 497 | 172 | 175 | 609 | ||
| - | - | - | - | - Result investment held for sale, after tax | 2, 3 | 0 | 11 | 1 | 1 | 10 | |
| 2,242 | 408 | 487 | 1,841 | 1,930 Net profit | 2,017 | 2,199 | 617 | 675 | 2,902 | ||
| Attributable to additional Tier 1 Capital | |||||||||||
| 48 | 9 | 12 | 39 | 44 | holders | 45 | 40 | 12 | 10 | 50 | |
| Attributable to Equity capital certificate | |||||||||||
| 1,403 | 255 | 304 | 1,153 | 1,206 | holders | 1,201 | 1,308 | 374 | 416 | 1,722 | |
| 791 | 144 | 171 | 650 | 680 Attributable to the saving bank reserve | 677 | 737 | 211 | 234 | 971 | ||
| Attributable to non-controlling interests | 93 | 113 | 19 | 15 | 160 | ||||||
| 2,242 | 408 | 487 | 1,841 | 1,930 Net profit | 2,017 | 2,199 | 617 | 675 | 2,902 | ||
| Profit/diluted profit per ECC | 19 | 9.29 | 10.11 | 2.89 | 3.22 | 13.31 |
| Parent bank | Group | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Third | January - | January - | Third | |||||||
| quarter | September | September | quarter | |||||||
| 2021 | 2021 | 2022 | 2021 | 2022 (NOKm) | 2022 | 2021 | 2022 | 2021 | 2021 | |
| 2,242 | 408 | 487 | 1,841 | 1,930 Net profit | 2,017 | 2,199 | 617 | 675 | 2,902 | |
| Items that will not be reclassified to profit/loss | ||||||||||
| -49 | - | 171 | - | 171 Actuarial gains and losses pensions | 171 | - | 171 | - | -49 | |
| 12 | - | -43 | - | -43 Tax | -43 | - | -43 | - | 12 | |
| Share of other comprehensive income of associates and | ||||||||||
| - | - | - | - | - | joint venture | 7 | 2 | 1 | - | 4 |
| -37 | - | 128 | - | 128 Total | 136 | 2 | 129 | - | -33 | |
| Items that will be reclassified to profit/loss | ||||||||||
| Fair value change on financial assets through other | ||||||||||
| - | - | - | - | - | comprehensive income | - | - | - | - | - |
| -1 | -1 | 3 | -1 | 3 Value changes on loans measured at fair value | 3 | -1 | 3 | -1 | -1 | |
| Share of other comprehensive income of associates and | ||||||||||
| - | - | - | - | - | joint venture | 234 | -17 | 142 | 25 | 21 |
| - | - | - | - | - Tax | - | - | - | - | - | |
| -1 | -1 | 3 | -1 | 3 Total | 237 | -18 | 145 | 24 | 20 | |
| -38 | -1 | 131 | -1 | 131 Net other comprehensive income | 372 | -16 | 274 | 24 | -13 | |
| 2,204 | 407 | 618 | 1,840 | 2,060 Total comprehensive income | 2,389 | 2,183 | 891 | 699 | 2,889 | |
| 48 | 9 | 12 | 39 | 44 Attributable to additional Tier 1 Capital holders | 45 | 40 | 12 | 10 | 50 | |
| 1,379 | 255 | 388 | 1,152 | 1,290 Attributable to Equity capital certificate holders | 1,439 | 1,298 | 550 | 431 | 1,714 | |
| 777 | 143 | 219 | 649 | 727 Attributable to the saving bank reserve | 811 | 732 | 310 | 243 | 966 | |
| Attributable to non-controlling interests | 93 | 113 | 19 | 15 | 160 | |||||
| 2,204 | 407 | 618 | 1,840 | 2,060 Total comprehensive Income | 2,389 | 2,183 | 891 | 699 | 2,889 |
| Parent bank | Group | ||||||
|---|---|---|---|---|---|---|---|
| 31 Dec 21 | 30 Sep 21 | 30 Sep 22 (NOKm) | Note | 30 Sep 22 | 30 Sep 21 | 31 Dec 21 | |
| 1,252 | 1,206 | 317 Cash and receivables from central banks | 317 | 1.206 | 1,252 | ||
| 13,190 | 15,701 | 26,596 Deposits with and loans to credit institutions | 16,773 | 7,338 | 4,704 | ||
| 135,766 | 132,507 | 137,727 Net loans to and receivables from customers | 5 | 149,162 | 142,404 | 145,890 | |
| 30,762 | 30,032 | 30,560 Fixed-income CDs and bonds | 17 | 30,561 | 30,032 | 30,762 | |
| 3,192 | 3,662 | 7,242 Derivatives | 17 | 7,480 | 3,732 | 3,224 | |
| 402 | 357 | 399 Shares, units and other equity interests | 17 | 1,974 | 2,525 | 2,654 | |
| 4,590 | 4,782 | 4,676 Investment in related companies | 7,714 | 7,324 | 7,384 | ||
| 2,374 | 2,374 | 2,374 Investment in group companies | - | - | - | ||
| 98 | 98 | 98 Investment held for sale | 2 | 111 | 60 | 59 | |
| 458 | 500 | 465 Intangible assets | 864 | 894 | 853 | ||
| 1,082 | 3,261 | 2,671 Other assets | 3,962 | 4,609 | 2,062 | ||
| 193,165 | 194,480 | 213,124 Total assets | 218,918 | 200,124 | 198,845 | ||
| 14,342 | 13,909 | 13,715 Deposits from credit institutions | 14,495 | 14,601 | 15,065 | ||
| 112,028 | 110,328 | 121,148 Deposits from and debt to customers | 9 | 120,558 | 109,691 | 111,286 | |
| 40,332 | 41,895 | 46,158 Debt created by issue of securities | 16 | 46,158 | 41,895 | 40,332 | |
| 3,500 | 3,405 | 8,024 Derivatives | 17 | 8,115 | 3,741 | 3,909 | |
| 1,855 | 3,561 | 2,217 Other liabilities 15 |
3,672 | 5,323 | 3,215 | ||
| - | - | - Investment held for sale | 2 | 2 | 1 | 1 | |
| 1,753 | 1,752 | 2,010 Subordinated loan capital | 16 | 2,054 | 1,795 | 1,796 | |
| 173,809 | 174,850 | 193,273 Total liabilities | 195,054 | 177,047 | 175,603 | ||
| 2,597 | 2,597 | 2,597 Equity capital certificates | 2,597 | 2,597 | 2,597 | ||
| -0 | -0 | -0 Own holding of ECCs | -11 | -9 | -9 | ||
| 895 | 895 | 895 Premium fund | 895 | 895 | 895 | ||
| 7,007 | 6,556 | 7,007 Dividend equalisation fund | 6,958 | 6,524 | 6,974 | ||
| 970 | 401 | - Recommended dividends | - | 401 | 970 | ||
| 547 | 226 | - Provision for gifts | - | 226 | 547 | ||
| 5,918 | 5,664 | 5,918 Ownerless capital | 5,918 | 5,664 | 5,918 | ||
| 171 | 239 | 171 Unrealised gains reserve | 171 | 239 | 171 | ||
| - | -2 | 128 Other equity capital | 3,158 | 2,241 | 2,896 | ||
| 1,250 | 1,211 | 1,206 Additional Tier 1 Capital | 1,247 | 1,252 | 1,293 | ||
| 1,841 | 1,930 Profit for the period | 2,017 | 2,199 | ||||
| Non-controlling interests | 913 | 848 | 989 | ||||
| 19,356 | 19,629 | 19,852 Total equity capital | 23,863 | 23,077 | 23,241 | ||
| 193,165 | 194,480 | 213,124 Total liabilities and equity | 218,918 | 200,124 | 198,845 |
| Parent bank | Group | |||||
|---|---|---|---|---|---|---|
| January - September | January - September | |||||
| 2021 | 2021 | 2022 (NOKm) | 2022 | 2021 | 2021 | |
| 2,242 | 1,841 | 1,930 Net profit | 2,017 | 2,199 | 2,902 | |
| 95 | 74 | 57 Depreciations and write-downs on fixed assets | 100 | 149 | 186 | |
| 134 | 115 | -45 Losses on loans and guarantees | -26 | 129 | 161 | |
| -418 | -418 | -252 Adjustments for undistributed profits of related companies | -248 | -549 | -705 | |
| -2,423 | -1,591 | -993 Other adjustments | -1,032 | -1,726 | -2,574 | |
| -369 | 21 | 697 Net cash increase from ordinary operations | 812 | 201 | -31 | |
| 3,843 | 1,201 | -5,643 Decrease/(increase) other receivables | -6,144 | 1,357 | 4,387 | |
| -2,993 | -1,343 | 5,013 Increase/(decrease) short term debt | 4,792 | -1,197 | -3,159 | |
| -11,686 | -8,408 | -1,913 Decrease/(increase) loans to customers | -3,243 | -9,403 | -12,920 | |
| -288 | -2,800 | -13,406 Decrease/(increase) loans credit institutions | -12,069 | -2,247 | 387 | |
| 13,862 | 12,163 | 9,120 Increase/(decrease) deposits to customers | 9,272 | 12,163 | 13,757 | |
| -290 | -721 | -626 Increase/(decrease) debt to credit institutions | -569 | -494 | -32 | |
| -4,077 | -3,347 | 202 Increase/(decrease) in short term investments | 201 | -3,425 | -4,156 | |
| - | - | - Increase/(decrease) in shares held for trading | 689 | 18 | -59 | |
| -1,999 | -3,236 | -6,557 A) Net cash flow from operations | -6,260 | -3,028 | -1,826 | |
| -75 | -44 | -64 Increase in tangible fixed assets | -126 | -154 | -145 | |
| 60 | - | - Proceeds from sales of property, plant and equipment | - | - | 4 | |
| Cash flows from losing control of subsidiaries or other | ||||||
| - | - | - | businesses | - | 17 | 99 |
| Cash flows used in obtaining control of subsidiaries or other | ||||||
| -73 | -73 | -0 | businesses | -52 | - | - |
| 418 | 418 | 252 Dividends received from investments in related companies | 252 | 419 | 419 | |
| Other cash receipts from sales of interests in associates and | ||||||
| 548 | 341 | 6 | joint ventures Other cash payments to acquire interests in associates and |
6 | 361 | 544 |
| -204 | -190 | -92 | joint ventures | -117 | -275 | -307 |
| Other cash receipts from sales of equity instruments of other | ||||||
| 672 | 574 | 551 | entities | 587 | 593 | 737 |
| Other cash payments to acquire equity instruments of other | ||||||
| -766 | -618 | -549 | entities | -557 | -640 | -826 |
| 580 | 409 | 104 B) Net cash flow from investments | -8 | 321 | 526 | |
| - | - | 1,000 Increase in subordinated loan capital | 1,000 | - | - | |
| - | - | -750 Decrease in subordinated loan capital | -750 | - | - | |
| -0 | -0 | -0 Purchase of treasury shares | -21 | -6 | -5 | |
| -569 | -168 | -970 Dividend cleared | -970 | -168 | -569 | |
| - | - | - Dividends paid to non-controlling interests | -162 | -113 | -113 | |
| -321 | -95 | -547 Disbursed from gift fund | -547 | -95 | -321 | |
| -48 | -39 | -44 Interest payments Additional Tier 1 Capital | -45 | -40 | -50 | |
| 7,867 | 7,867 | 13,225 Increase in other long term loans | 13,225 | 7,867 | 7,867 | |
| -7,021 | -6,296 | -6,397 Decrease in other long term loans | -6,397 | -6,296 | -7,021 | |
| -93 | 1,269 | 5,517 C) Net cash flow from financial activities | 5,332 | 1,149 | -212 | |
| -1,512 | -1,558 | -935 A) + B) + C) Net changes in cash and cash equivalents | -935 | -1,558 | -1,512 | |
| 2,764 | 2,764 | 1,252 Cash and cash equivalents at 1.1 | 1,252 | 2,764 | 2,764 | |
| 1,252 | 1,206 | 317 Cash and cash equivalents at end of quarter | 317 | 1,206 | 1,252 | |
| -1,512 | -1,558 | -935 Net changes in cash and cash equivalents | -935 | -1,558 | -1,512 |
| Parent Bank | Issued equity | Earned equity | |||||||
|---|---|---|---|---|---|---|---|---|---|
| (NOKm) | EC capital |
Premium fund |
Owner less capital |
Equali sation fund |
Dividend and gifts |
Un realised gains reserve |
Other equity |
Additional Tier 1 Capital |
Total equity |
| Equity at 1 January 2021 | 2,597 | 895 | 5,664 | 6,556 | 890 | 239 | - | 1,250 18,092 | |
| Net profit | - | - | 268 | 476 | 1,517 | -68 | - | 48 | 2,242 |
| Other comprehensive income | |||||||||
| Financial assets through OCI | - | - | - | - | - | - | -1 | - | -1 |
| Actuarial gains (losses), pensions | - | - | - | - | - | - | -37 | - | -37 |
| Other comprehensive income | - | - | - | - | - | - | -38 | - | -38 |
| Total comprehensive income | - | - | 268 | 476 | 1,517 | -68 | -38 | 48 | 2,204 |
| Transactions with owners | |||||||||
| Dividend declared for 2020 | - | - | - | - | -569 | - | - | - | -569 |
| To be disbursed from gift fund | - | - | - | - | -321 | - | - | - | -321 |
| Additional Tier 1 Capital | - | - | - | - | - | - | - | - | - |
| Interest payments additional Tier 1 | |||||||||
| capital | - | - | - | - | - | - | - | -48 | -48 |
| Purchase and sale of own ECCs | 0 | - | - | -0 | - | - | - | - | -0 |
| Direct recognitions in equity | - | - | -14 | -25 | - | - | 38 | - | -2 |
| Total transactions with owners | 0 | - | -14 | -25 | -890 | - | 38 | -48 | -940 |
| Equity at 31 December 2021 | 2,597 | 895 | 5,918 | 7,007 | 1,517 | 171 | - | 1,250 19,356 |
| Parent Bank | Issued equity | Earned equity | |||||||
|---|---|---|---|---|---|---|---|---|---|
| (NOKm) | EC capital |
Premium fund |
Owner less capital |
Equali sation fund |
Dividend and gifts |
Un realised gains reserve |
Other equity |
Additional Tier 1 Capital |
Total equity |
| Equity at 1 January 2022 Net profit |
2,597 - |
895 - |
5,918 - |
7,007 - |
1,517 - |
171 - |
- 1,930 |
- | 1,250 19,356 1,930 |
| Other comprehensive income Value changes on loans measured at fair value |
- | - | - | - | - | - | 3 | - | 3 |
| Actuarial gains (losses), pensions | - | - | - | - | - | - | 128 | - | 128 |
| Other comprehensive income | - | - | - | - | - | - | 131 | - | 131 |
| Total comprehensive income | - | - | - | - | - | - | 2,060 | - | 2,060 |
| Transactions with owners Dividend declared for 2021 |
- | - | - | - | -970 | - | - | - | -970 |
| To be disbursed from gift fund | - | - | - | - | -547 | - | - | - | -547 |
| Additional Tier 1 Capital | - | - | - | - | - | - | - | - | - |
| Interest payments additional Tier 1 capital |
- | - | - | - | - | - | - | -44 | -44 |
| Purchase and sale of own ECCs | 0 | - | - | -0 | - | - | - | - | -0 |
| Direct recognitions in equity | - | - | - | - | - | - | -3 | - | -3 |
| Total transactions with owners | 0 | - | - | -0 | -1,517 | - | -3 | -44 | -1,564 |
| Equity at 30 September 2022 | 2,597 | 895 | 5,918 | 7,007 | - | 171 | 2,057 | 1,206 19,852 |
| Attributable to parent company equity holders | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Group | Issued equity | Earned equity | ||||||||
| (NOKm) | EC capital |
Premium fund |
Owner less capital |
Equali sation fund |
Dividend and gifts |
Un realised gains reserve |
Other equity |
Additional Tier 1 Capital |
NCI | Total equity |
| Equity at 1 January 2021 | 2,588 | 895 | 5,664 | 6,536 | 890 | 239 | 2,366 | 1,293 | 838 | 21,310 |
| Net profit | - | - | 268 | 476 | 1,517 | -68 | 499 | 50 | 160 | 2,902 |
| Other comprehensive income | ||||||||||
| Share of other comprehensive income of associates and joint ventures Value changes on loans |
- | - | - | - | - | - | 26 | - | - | 26 |
| measured at fair value | - | - | - | - | - | - | -1 | - | - | -1 |
| Actuarial gains (losses), pensions |
- | - | - | - | - | - | -38 | - | - | -38 |
| Other comprehensive income | - | - | - | - | - | - | -13 | - | - | -13 |
| Total comprehensive income | - | - | 268 | 476 | 1,517 | -68 | 486 | 50 | 160 | 2,889 |
| Transactions with owners Dividend declared for 2020 To be disbursed from gift fund Additional Tier 1 Capital issued Buyback Additional Tier 1 Capital issued |
- - - - |
- - - - |
- - - - |
- - - - |
-569 -321 - - |
- - - - |
- - - - |
- - - - |
- - - - |
-569 -321 - - |
| Interest payments additional Tier 1 capital |
- | - | - | - | - | - | - | -50 | - | -50 |
| Purchase and sale of own ECCs Own ECC held by SB1 |
0 | - | - | -0 | - | - | - | - | - | -0 |
| Markets*) | -0 | - | - | -13 | - | - | 7 | - | - | -5 |
| Direct recognitions in equity | - | - | -14 | -25 | - | - | 50 | - | - | 11 |
| Share of other transactions from associates and joint ventures Change in non-controlling interests |
- - |
- - |
- - |
- - |
- - |
- - |
-14 - |
- - |
- -9 |
-14 -9 |
| Total transactions with owners | -0 | - | -14 | -38 | -890 | - | 43 | -50 | -9 | -958 |
| Equity at 31 December 2021 | 2,588 | 895 | 5,918 | 6,974 | 1,517 | 171 | 2,896 | 1,293 | 989 | 23,241 |
*) Holding of own equity certificates as part of SpareBank 1 Markets' trading activity
| Attributable to parent company equity holders | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Issued equity | Earned equity | |||||||||
| (NOKm) | EC capital |
Premium fund |
Owner less capital |
Equali sation fund |
Dividend and gifts |
Un realised gains reserve |
Other equity |
Additional Tier 1 Capital |
NCI | Total equity |
| Equity at 1 January 2022 | 2,588 | 895 | 5,918 | 6,974 | 1,517 | 171 | 2,896 | 1,293 | 989 | 23,241 |
| Net profit | - | - | - | - | - | - | 1,924 | - | 93 | 2,017 |
| Other comprehensive income |
||||||||||
| Share of other comprehensive income of associates and joint ventures |
- | - | - | - | - | - | 241 | - | - | 241 |
| Value changes on loans | ||||||||||
| measured at fair value | - | - | - | - | - | - | 3 | - | - | 3 |
| Actuarial gains (losses), | ||||||||||
| pensions | - | - | - | - | - | - | 128 | - | - | 128 |
| Other comprehensive income | - | - | - | - | - | - | 372 | - | - | 372 |
| Total comprehensive income | - | - | - | - | - | - | 2,296 | - | 93 | 2,389 |
| Transactions with owners | ||||||||||
| Dividend declared for 2021 | - | - | - | - | -970 | - | - | - | - | -970 |
| To be disbursed from gift fund | - | - | - | - | -547 | - | - | - | - | -547 |
| Additional Tier 1 capital issued | - | - | - | - | - | - | - | - | - | - |
| Buyback additional Tier 1 Capital issued |
- | - | - | - | - | - | - | - | - | - |
| Interest payments additional Tier 1 capital |
- | - | - | - | - | - | - | -45 | - | -45 |
| Purchase and sale of own ECCs |
0 | - | - | -0 | - | - | - | - | - | -0 |
| Own ECC held by SB1 Markets*) |
-2 | - | - | -16 | - | - | -2 | - | - | -21 |
| Direct recognitions in equity | - | - | - | - | - | - | -8 | - | - | -8 |
| Share of other transactions from associates and joint |
||||||||||
| ventures | - | - | - | - | - | - | -5 | - | - | -5 |
| Change in non-controlling interests |
- | - | - | - | - | - | - | - | -170 | -170 |
| Total transactions with owners | -2 | - | - | -16 | -1,517 | - | -16 | -45 | -170 | -1,767 |
| Equity at 30 September 2022 | 2,586 | 895 | 5,918 | 6,958 | - | 171 | 5,175 | 1,247 | 913 | 23,863 |
*) Holding of own equity certificates as part of SpareBank 1 Markets' trading activity
| Note 1 - Accounting principles 32 | |
|---|---|
| Note 2 - Critical estimates and assessment concerning the use of accounting principles 33 | |
| Note 3 - Account by business line 36 | |
| Note 4 - Capital adequacy 38 | |
| Note 5 - Distribution of loans by sector/industry 40 | |
| Note 6 - Losses on loans and guarantees 41 | |
| Note 7 - Losses 42 | |
| Note 8 - Gross loans 48 | |
| Note 9 - Distribution of customer deposits by sector/industry 50 | |
| Note 10 - Net interest income 51 | |
| Note 11 - Net commission income and other income 52 | |
| Note 12 - Operating expenses 53 | |
| Note 13 - Net return on financial investments 54 | |
| Note 14 - Other assets 55 | |
| Note 15 - Other liabilities 56 | |
| Note 16 - Debt created by issue of securities and subordinated debt 57 | |
| Note 17 - Measurement of fair value of financial instruments 58 | |
| Note 18 - Liquidity risk 61 | |
| Note 19 - Earnings per EC 62 |
SpareBank 1 SMN prepares and presents its quarterly accounts in compliance with the Stock Exchange Regulations, Stock Exchange Rules and International Financial Reporting Standards (IFRS) approved by EU, including IAS 34, Interim Financial Reporting. The quarterly accounts do not include all the information required in a complete set of annual financial statements and should be read in conjunction with the annual accounts for 2021. The Group has in this quarterly report used the same accounting principles and calculation methods as in the latest annual report and accounts.
When it prepares the consolidated accounts the management team makes estimates, discretionary assessments and assumptions which influence the application of accounting principles. This accordingly affects recognised amounts for assets, liabilities, revenues and expenses. Last year's annual accounts give a closer explanation of significant estimates and assumptions in Note 3 Critical estimates and assessments concerning the use of accounting principles.
Sparebank1 SMN Group has one pension arrangement; defined contribution plan. For a further description of the various pension schemes, see note 22 in the 2021 annual report.
The group's pension liabilities are accounted for under IAS 19R. Estimate variances are therefore directly reflected in equity capital and are presented under other comprehensive income. It was decided to terminate the defined benefit scheme at a board meeting on 21 October 2016. Employees on this scheme transferred to the defined contribution scheme from 1 January 2017, and received a paid-up policy showing rights accumulated under the defined benefit scheme. Paid-up policies are managed by the pension fund, which has been a paid-up pension fund as from 1 January 2017. A framework agreement has been established between SpareBank 1 SMN and the pension fund which covers funding, asset management etc. In view of the responsibility still held by SpareBank 1 SMN, future liabilities will need to be incorporated in the accounts. The board of the pension fund is required to be composed of representatives from the Group and participants in the pension schemes in accordance with the articles of association of the pension fund.
The Group has obtained a new calculation of pensions as of 30 September 2022:
| Actuarial assumptions | 31 Dec 2021 | 1 Jan 2021 | 30 Sep 2022 |
|---|---|---|---|
| Discount rate | 1.6 % | 1.5 % | 3.2 % |
| Expected rate of return on plan assets | 1.6 % | 1.5 % | 3.2 % |
| Expected future wage and salary growth | 2.3 % | 2.0 % | 3.5 % |
| Expected adjustment on basic amount (G) | 2.3 % | 2.0 % | 3.5 % |
| Expected increase in current pension | 0.0 % | 0.0 % | 0.0 % |
| Employers contribution | 19.1 % | 19.1 % | 19.1 % |
| Demographic assumptions: | |||
| Mortality base table | K2013BE | ||
| Disability | IR73 | ||
| Voluntary exit | 2% to 50 years, 0% after 50 years |
| Movement in net pension liability in the balance sheet Group (NOKm) | Funded | Unfunded | Total |
|---|---|---|---|
| Net pension liability in the balance sheet 1.January 2022 | -62 | 8 | -54 |
| OCI accounting Opening balance | 0 | 0 | 0 |
| OCI accounting Closing balance | -170 | -1 | -171 |
| Net defined-benefit costs in profit and loss account | -1 | 0 | -1 |
| Paid in pension premium, defined-benefit schemes | 0 | 0 | 0 |
| Paid in pension premium, defined-benefit plan | 0 | -1 | -1 |
| Net pension liability in the balance sheet 30 September 2022 | -233 | 7 | -226 |
| Net pension liability in the balance sheet Group (NOKm) | 30 Sep 2022 | 31 Dec 2021 |
|---|---|---|
| Net present value of pension liabilities in funded schemes | 520 | 645 |
| Estimated value of pension assets | -748 | -701 |
| Net pension liability in the balance sheet before employer's contribution | -227 | -56 |
| Employers contribution | 1 | 1 |
| Net pension liability in the balance sheet | -226 | -54 |
| Pension cost Group (NOKm) | 30 Sep 2022 | 31 Dec 2021 |
| Present value of pension accumulated in the year | 0 | 0 |
| Net interest income | -1 | -2 |
| Net pension cost related to defined plans, incl unfunded pension commitment | -1 | -1 |
| Empolyer's contribution subject to accrual accounting | 0 | 0 |
| Cost of defined contribution pension and early retirement pension scheme | 90 | 115 |
SpareBank 1 SMN's strategy is that ownership due to defaulted exposures should at the outset be of brief duration, normally not longer than one year. Investments are recorded at fair value in the Parent Bank's accounts, and is classified as investment held for sale.
| Jan-Sep 2022 (NOKm) | Assets | Liabilities | Revenue | Expenses | Profit | Ownership | |
|---|---|---|---|---|---|---|---|
| Mavi XV AS Group | 111 | 2 | 9 | -9 | 0 | 100 % | |
| Total Held for sale | 111 | 2 | 9 | -9 | 0 |
For a detailed description of the Bank's model for expected credit losses, refer to note 2 and 3 in the annual accounts for 2021.
The input in the credit loss model have been changed in 2020 and 2021 a result of increased uncertainty due to the corona situation. This uncertainty has been significantly reduced, but in 2022 macroeconomic uncertainty has increased as a result of the war in Ukraine, a strong increase in energy and raw material prices, challenges in the supply chains and the prospect of permanently higher inflation and interest rates made the assessments extra demanding. The bank has focused on the expected long-term effects of the crisis.
In 2020, the bank changed the assumptions for the base scenario in a negative direction. These assumptions were continued in 2021. The bank's exposure to hotels and tourism, including commercial real estate with the income mainly towards this industry, was separated into a separate portfolio with its own assessments of PD and LGD courses as well as special scenarios and weighting of these to reflect this portfolio's exposure to the effects of corona. In addition, this entire portfolio is included in stage 2 or 3.
The central drivers of losses in the individual scenarios are projections of trajectories for the probability of default (PD) and losses in case of default (LGD). In addition, the expected loss is affected by the probability weight for the individual scenario. The expected negative effects of the corona pandemic were in the assessments for 2020/2021 primarily linked to debtors who had a demanding starting point before the crisis – typically debtors in stage 2. The bank therefore chose to increase the trajectories for PD and LGD, as well as reduce expected repayments in the base scenario, especially from year two onwards. This change affects the expected loss for debtors in stage 2. To adjust for migration into stage 2, the PD and LGD estimates were also increased in the first year. No first year repayments are assumed for all portfolios in the downside scenario. The effects of the corona pandemic was significantly smaller than expected. This is due, among other things, to implemented authority measures. The bank therefore decided to reverse the pandemic-related mark-ups in the trajectories in the base scenario in the third quarter of 2021 for PM and in the first quarter of 2022 for BM. In second and third quarter 2022, upward adjustments have been made to the PD and LGD trajectories throughout the assessment period against the backdrop of a rising interest rate market which, in combination with the inflation, leads to an expectation of an increased level of default and lower asset values in the future
The applied scenario weighting was changed in 2020 to reflect further increased uncertainty. For corporate market including offshore, as well as agriculture, the downside scenario was changed from a weighting with a 10 percent probability, to a weighting of a 20 percent probability. For retail market, the weighting of the downside scenario was changed from 10 to 15 per cent. In 2022, the weighting of the downside scenario was increased to 25 per cent in the agriculture and other business portfolios (excluding offshore) and hotels/tourism to take into account increased uncertainty as a result of the war in Ukraine as well as generally greater uncertainty with regard to future economical growth. In the third quarter of 2022, the weighting of the downside scenario has also been increased in the subsidiary SpareBank1 Finans Midt-Norge from respectively 10 to 25 per cent for BM and from 10 to 15 per cent for PM.
The effect of changes in input assumptions is shown as "Effect of changed assumptions in ECL model" in note 7.
The write-downs are reduced as a result of the removal of mark-ups in the base scenario for the business portfolio (excl. offshore and hotels) and reduced markup in PD and LGD projectories for hotel/tourism (down from a very high level). On the other hand, write-downs are increasing both for business and industry the personal market portfolio as a result of a new mark-up in PD and LGD trajectories as a result of a significantly increased interest rate level. In addition, increased weight on low scenario for the business portfolio result in increased write-downs. In total, this amounts to NOK 82 million for the bank and NOK 98 million for the group in reduced write-downs
The first part of the table below show total calculated expected credit loss as of 30 September 2022 in each of the three scenarios, distributed in the portfolios Retail Market, Corporate Market (excl offshore and agriculture) and offshore, tourism and agriculture, which adds up to parent bank. In addition the subsidiary SpareBank 1 Finans Midt-Norge is included with portfolios Corporate and Retail Market. ECL for the parent bank and the subsidiary is summed up in the coloumn "Group".
The second part of the table show the ECL distributed by portfolio using the scenario weight applied, in addition to a alternative weighting where downside scenario weight has been doubled.
If the downside scenario's probability were doubled at the expense of the baseline scenario at the end of September 2022, this would have entailed an increase in loss provisions of NOK 259 million for the parent bank and NOK 280 million for the group.
| SB 1 | SB 1 | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| CM | RM | Offshore | Tourism Agriculture | Total parent |
Finans MN, CM |
Finans MN, RM |
Group | ||
| ECL base case | 465 | 71 | 314 | 15 | 41 | 905 | 36 | 20 | 962 |
| ECL worst case | 1,069 | 236 | 512 | 74 | 148 | 2,038 | 82 | 70 | 2,190 |
| ECL best case | 361 | 28 | 218 | 7 | 22 | 635 | 24 | 13 | 672 |
| ECL with scenario weights used 60/25/15 |
601 | - | - | 65 | 665 | 44 | - | 709 | |
| ECL with scenario weights used 65/20/15 |
- | - | 339 | - | 339 | - | - | 339 | |
| ECL with scenario weights used 60/30/10 |
- | 32 | 32 | - | 32 | ||||
| ECL with scenario weights used 70/15/15 |
- | 89 | - | - | - | 89 | - | 26 | 115 |
| Total ECL used | 601 | 89 | 339 | 32 | 65 | 1,126 | 44 | 26 | 1,196 |
| ECL alternative scenario weights 35/50/15 |
752 | - | - | - | 91 | 843 | 57 | - | 900 |
| ECL alternative scenario weights 45/40/15 |
- | - | 379 | - | - | 379 | - | - | 379 |
| ECL alternative scenario weights 30/60/10 |
- | - | - | 49 | - | 49 | - | - | 49 |
| ECL alternative scenario weights 55/30/15 |
114 | - | 114 | 33 | 147 | ||||
| Total ECL alternative | |||||||||
| weights | 752 | - | 379 | 49 | 91 | 1,385 | 57 | 33 | 1,476 |
| Change in ECL if alternative weights were |
|||||||||
| used | 151 | 25 | 40 | 18 | 27 | 259 | 14 | 7 | 280 |
The table reflects that there are some significant differences in underlying PD and LGD estimates in the different scenarios and that there are differentiated levels and level differences between the portfolios. At group level, the ECL in the upside scenario, which largely reflects the loss and default picture in recent years, is about 70 per cent of the ECL in the expected scenario. The downside scenario gives over double the ECL than in the expected scenario. Applied scenario weighting gives about 25 percent higher ECL than in the expected scenario.
For the subsidiaries the figures refer to the respective company accounts, while for joint ventures incorporated by the equity method the Group's profit share is stated, after tax, as well as book value of the investment at group level.
| SB 1 | SB 1 | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Profit and loss account | SB1 | Finans | Regnskaps | ||||||
| (NOKm) | RM | CM | Markets | EM 1 | MN | huset SMN | Other Uncollated | Total | |
| Net interest | 930 | 977 | 4 | 4 | 339 | 1 | - | 116 | 2,370 |
| Interest from allocated capital | 85 | 69 | - | - | - | - | - | -155 | - |
| Total interest income | 1,015 | 1,047 | 4 | 4 | 339 | 1 | - | -39 | 2,370 |
| Comission income and other | |||||||||
| income | 620 | 206 | 461 | 324 | -78 | 467 | - | -79 | 1,921 |
| Net return on financial | |||||||||
| investments *) | -3 | 7 | 78 | 8 | -18 | - | 265 | 89 | 427 |
| Total income | 1,631 | 1,260 | 543 | 336 | 243 | 468 | 265 | -28 | 4,718 |
| Total operating expenses | 705 | 348 | 426 | 271 | 83 | 392 | - | -17 | 2,208 |
| Ordinary operating profit | 926 | 913 | 117 | 64 | 160 | 76 | 265 | -11 | 2,511 |
| Loss on loans, guarantees | |||||||||
| etc. | 2 | -47 | - | - | 20 | - | - | -0 | -26 |
| Result before tax | 924 | 959 | 117 | 64 | 141 | 76 | 265 | -11 | 2,536 |
| SB 1 | SB 1 | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Profit and loss account | SB1 | Finans | Regnskaps | ||||||
| (NOKm) | RM | CM | Markets | EM 1 | MN | huset SMN | Other Uncollated | Total | |
| Net interest | 840 | 826 | -3 | 1 | 340 | -0 | - | 69 | 2,073 |
| Interest from allocated capital | 19 | 2 | - | - | - | - | - | -21 | - |
| Total interest income | 859 | 828 | -3 | 1 | 340 | -0 | - | 47 | 2,073 |
| Comission income and other | |||||||||
| income | 682 | 178 | 611 | 342 | -67 | 439 | - | -23 | 2,161 |
| Net return on financial | |||||||||
| investments *) | 2 | 10 | 81 | 10 | -2 | - | 521 | 186 | 808 |
| Total income | 1,542 | 1,016 | 689 | 353 | 271 | 439 | 521 | 210 | 5,042 |
| Total operating expenses | 673 | 325 | 486 | 282 | 106 | 357 | - | -2 | 2,228 |
| Ordinary operating profit | 869 | 691 | 203 | 71 | 165 | 82 | 521 | 212 | 2,814 |
| Loss on loans, guarantees | |||||||||
| etc. | -11 | 125 | - | - | 13 | - | - | 1 | 129 |
| Result before tax | 880 | 566 | 203 | 71 | 151 | 82 | 521 | 212 | 2,685 |
| SB 1 | SB 1 | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Profit and loss account | SB1 | Finans | Regnskaps | ||||||
| (NOKm) | RM | CM | Markets | EM 1 | MN | huset SMN | Other Uncollated | Total | |
| Net interest | 1,128 | 1,106 | -7 | 2 | 450 | 0 | - | 117 | 2,796 |
| Interest from allocated capital | 37 | 14 | - | - | - | - | - | -52 | - |
| Total interest income | 1,165 | 1,120 | -7 | 2 | 450 | 0 | - | 66 | 2,796 |
| Comission income and other income |
906 | 251 | 782 | 441 | -90 | 562 | - | -20 | 2,832 |
| Net return on financial investments *) |
2 | 15 | 126 | 10 | 4 | - | 701 | 168 | 1,026 |
| Total income | 2,074 | 1,386 | 901 | 453 | 364 | 562 | 701 | 214 | 6,655 |
| Total operating expenses | 916 | 446 | 647 | 382 | 141 | 477 | - | -16 | 2,993 |
| Ordinary operating profit Loss on loans, guarantees |
1,157 | 940 | 254 | 71 | 224 | 85 | 701 | 230 | 3,662 |
| etc. | -10 | 145 | - | - | 25 | - | - | 1 | 161 |
| Result before tax | 1,167 | 795 | 254 | 71 | 198 | 85 | 701 | 229 | 3,501 |
| *) Specification of other (NOKm) | 30 Sep 22 | 30 Sep 21 | 31 Dec 21 |
|---|---|---|---|
| SpareBank 1 Gruppen | 46 | 298 | 471 |
| SpareBank 1 Boligkreditt | 2 | 18 | 16 |
| SpareBank 1 Næringskreditt | 2 | 6 | 7 |
| BN Bank | 149 | 122 | 164 |
| SpareBank 1 Kreditt | 9 | 11 | 13 |
| SpareBank 1 Betaling | -9 | -4 | -15 |
| SpareBank 1 Forvaltning | 28 | 20 | 32 |
| Other companies | 38 | 49 | 13 |
| Income from investment in associates and joint ventures | 265 | 521 | 701 |
| SpareBank 1 Mobilitet Holding | -18 | -2 | 4 |
| Net income from investment in associates and joint ventures | 248 | 519 | 705 |
Capital adequacy is calculated and reported in accordance with the EU capital requirements regulations for banks and investment firms (CRR/CRD IV). SpareBank 1 SMN utilises the Internal Rating Based Approach (IRB) for credit risk. Advanced IRB Apporoach is used for the corporate portfolios. Use of IRB imposes wide-ranging requirements on the bank's organisational set-up, competence, risk models and risk management systems.
As of 30 September 2022 the overall minimum requirement on CET1 capital is 13.0 per cent. The capital conservation buffer requirement is 2.5 per cent, the systemic risk requirement for Norwegian IRB-banks is 4.5 per cent and the Norwegian countercyclical buffer is 1.5 per cent. These requirements are additional to the requirement of 4.5 per cent CET1 capital. In addition the financial supervisory authority has set a Pillar 2 requirement of 1.9 per cent for SpareBank 1 SMN, however not below NOK 1,794 million in monetary terms. From 30 April 2022, SpareBank 1 SMN has received a new Pillar 2 requirement. The rate of 1.9 per cent is unchanged, but in addition the bank must have an additional 0.7 per cent in Pillar 2 requirements until the application for modeling has been processed. The Norwegian countercyclical buffer will rise to 1.5 per cent with effect from 30 June 2022, and to 2.0 per cent from 31 December 2022.
Under the CRR/CRDIV regulations the average risk weighting of exposures secured on residential property in Norway cannot be lower than 20 per cent. As of 30 September 2022 an adjustment was made in both the parent bank and the group to bring the average risk weight up to 20 per cent. This is presented in the note together with 'mass market exposure, property' under 'credit risk IRB'.
The systemic risk buffer stands at 4.5 per cent for the Norwegian exposures. For exposures in other countries, the particular country's systemic buffer rate shall be employed. As of 30 September 2022 the effective rate for the parent bank and for the group is accordingly 4.4 per cent.
The countercyclical buffer is calculated using differentiated rates. For exposures in other countries the countercyclical buffer rate set by the authorities in the country concerned is applied. If that country has not set a rate, the same rate as for exposures in Norway is applied unless the Ministry of Finance sets another rate. As of 30 September 2022 both the parent bank and the group is below the capital deduction threshold such that the Norwegian rate is applied to all relevant exposures.
| Parent Bank | Group | |||||
|---|---|---|---|---|---|---|
| 31 Dec 21 | 30 Sep 21 | 30 Sep 22 (NOKm) | 30 Sep 22 | 30 Sep 21 | 31 Dec 21 | |
| 19,356 | 19,629 | 19,852 Total book equity | 23,863 | 23,077 | 23,241 | |
| -1,250 | -1,211 | -1,206 Additional Tier 1 capital instruments included in total equity | -1,247 | -1,252 | -1,293 | |
| -458 | -500 | -465 Deferred taxes, goodwill and other intangible assets | -955 | -1,040 | -961 | |
| -1,517 | -627 | - Deduction for allocated dividends and gifts | - | -627 | -1,517 | |
| - | - | - Non-controlling interests recognised in other equity capital | -913 | -848 | -989 | |
| - | - | - Non-controlling interests eligible for inclusion in CET1 capital | 701 | 504 | 568 | |
| - | -1,841 | -1,930 Net profit | -2,017 | -2,199 | - | |
| Year-to-date profit included in core capital (50 per cent (50 per | ||||||
| - | 723 | 900 | cent) pre tax of group profit) | 986 | 1,079 | - |
| -41 | -40 | -51 Value adjustments due to requirements for prudent valuation | -68 | -52 | -56 | |
| -495 | -581 | -141 Positive value of adjusted expected loss under IRB Approach | -213 | -616 | -560 | |
| - | - | - Cash flow hedge reserve | -5 | 5 | 3 | |
| Deduction for common equity Tier 1 capital in significant | ||||||
| -202 | -187 | -219 | investments in financial institutions | -449 | -360 | -648 |
| 15,393 | 15,365 | 16,739 Common equity Tier 1 capital | 19,683 | 17,671 | 17,790 | |
| 1,250 | 1,250 | 1,250 Additional Tier 1 capital instruments | 1,615 | 1,594 | 1,581 | |
| -48 | - | -46 Deduction for significant investments in financial institutions | -46 | - | -48 | |
| 16,595 | 16,615 | 17,943 Tier 1 capital | 21,252 | 19,265 | 19,322 | |
| - | ||||||
| - | Supplementary capital in excess of core capital | |||||
| 1,750 | 1,750 | 2,000 Subordinated capital | 2,502 | 2,247 | 2,226 | |
| -214 | -174 | -208 Deduction for significant investments in financial institutions | -208 | -174 | -214 | |
| 1,536 | 1,576 | 1,792 Additional Tier 2 capital instruments | 2,294 | 2,072 | 2,011 | |
| 18,130 | 18,190 | 19,735 Total eligible capital | 23,546 | 21,338 | 21,333 |
| Minimum requirements subordinated capital | |||||
|---|---|---|---|---|---|
| 1,049 | 1,074 | 1,123 Specialised enterprises | 1,315 | 1,254 | 1,248 |
| 1,016 | 955 | 945 Corporate | 965 | 968 | 1,030 |
| 1,400 | 1,415 | 1,352 Mass market exposure, property | 2,433 | 2,348 | 2,384 |
| 93 | 100 | 101 Other mass market | 104 | 103 | 95 |
| 1,000 | 1,045 | 1,201 Equity positions IRB | - | 1 | 1 |
| 4,558 | 4,590 | 4,722 Total credit risk IRB | 4,817 | 4,675 | 4,758 |
| 3 | 3 | 6 Central government | 6 | 4 | 4 |
| 106 | 130 | 92 Covered bonds | 136 | 151 | 133 |
| 398 | 379 | 361 Institutions | 248 | 324 | 299 |
| 1 | - | 117 Local and regional authorities, state-owned enterprises | 132 | 31 | 29 |
| 188 | 147 | 224 Corporate | 446 | 382 | 432 |
| 7 | 11 | 14 Mass market | 653 | 506 | 466 |
| 25 | 28 | 29 Exposures secured on real property | 111 | 120 | 128 |
| 279 | 264 | 90 Equity positions | 503 | 513 | 521 |
| 92 | 94 | 87 Other assets | 154 | 154 | 142 |
| 1,098 | 1,056 | 1,020 Total credit risk standardised approach | 2,390 | 2,186 | 2,154 |
| 35 | 36 | 39 Debt risk | 41 | 38 | 36 |
| - | - | - Equity risk | 16 | 22 | 34 |
| - | - | - Currency risk and risk exposure for settlement/delivery | 17 | 2 | 1 |
| 433 | 421 | 433 Operational risk | 810 | 777 | 817 |
| 26 | 25 | 31 Credit value adjustment risk (CVA) | 98 | 131 | 93 |
| 6,150 | 6,128 | 6,245 Minimum requirements subordinated capital | 8,189 | 7,830 | 7,893 |
| 76,873 | 76,599 | 78,063 Risk weighted assets (RWA) | 102,367 | 97,879 | 98,664 |
| 3,459 | 3,447 | 3,513 Minimum requirement on CET1 capital, 4.5 per cent | 4,607 | 4,405 | 4,440 |
| Capital Buffers | |||||
| 1,922 | 1,915 | 1,952 Capital conservation buffer, 2.5 per cent | 2,559 | 2,447 | 2,467 |
| 3,459 | 3,447 | ||||
| 769 | 3,513 Systemic risk buffer, 4.5 per cent | 4,607 | 4,405 | 4,440 | |
| 766 | 1,171 Countercyclical buffer, 1.0 per cent | 1,536 | 979 | 987 | |
| 6,150 | 6,128 | 6,635 Total buffer requirements on CET1 capital | 8,701 | 7,830 | 7,893 |
| 5,784 | 5,790 | 6,591 Available CET1 capital after buffer requirements | 6,375 | 5,436 | 5,457 |
| Capital adequacy | |||||
| 20.0 % | 20.1 % | 21.4 % Common equity Tier 1 capital ratio | 19.2 % | 18.1 % | 18.0 % |
| 21.6 % | 21.7 % | 23.0 % Tier 1 capital ratio | 20.8 % | 19.7 % | 19.6 % |
| 23.6 % | 23.7 % | 25.3 % Capital ratio | 23.0 % | 21.8 % | 21.6 % |
| Leverage ratio | |||||
| 191,697 | 189,698 | 197,794 Balance sheet items | 283,339 | 270,700 | 269,857 |
| 10,782 | 12,601 | 6,811 Off-balance sheet items | 8,100 | 11,887 | 11,341 |
| -1,042 | -1,121 | -923 Regulatory adjustments | -1,736 | -1,911 | -2,110 |
| 201,437 | 201,179 | 203,682 Calculation basis for leverage ratio | 289,703 | 280,677 | 279,088 |
| 16,595 8.2 % |
16,615 8.3 % |
17,943 Core capital 8.8 % Leverage Ratio |
21,252 7.3 % |
19,265 6.9 % |
19,322 6.9 % |
| Parent Bank | Group | |||||
|---|---|---|---|---|---|---|
| 31 Dec 21 | 30 Sep 21 | 30 Sep 22 (NOKm) | 30 Sep 22 | 30 Sep 21 | 31 Dec 21 | |
| 9,433 | 9,205 | 9,975 Agriculture and forestry | 10,389 | 9,546 | 9,783 | |
| 5,853 | 5,851 | 6,994 Fisheries and hunting | 7,016 | 5,869 | 5,870 | |
| 1,926 | 1,843 | 2,251 Sea farming industries | 2,507 | 2,093 | 2,176 | |
| 2,151 | 2,203 | 2,237 Manufacturing | 2,833 | 2,835 | 2,766 | |
| 3,169 | 2,884 | 4,298 Construction, power and water supply | 5,436 | 3,825 | 4,124 | |
| 2,572 | 2,320 | 2,889 Retail trade, hotels and restaurants | 3,471 | 2,662 | 2,966 | |
| 4,715 | 5,237 | 5,313 Maritime sector | 5,313 | 5,237 | 4,715 | |
| 16,924 | 16,724 | 18,392 Property management | 18,501 | 16,839 | 17,044 | |
| 4,497 | 4,083 | 3,869 Business services | 4,530 | 4,500 | 4,990 | |
| 5,714 | 5,433 | 5,756 Transport and other services provision | 6,721 | 6,367 | 6,667 | |
| 2 | 2 | 104 Public administration | 139 | 35 | 34 | |
| 1,383 | 1,392 | 1,673 Other sectors | 1,619 | 1,339 | 1,325 | |
| 58,337 | 57,176 | 63,752 Gross loans in Corporate market | 68,473 | 61,147 | 62,458 | |
| 126,828 | 124,841 | 133,641 Wage earners | 140,426 | 130,828 | 132,894 | |
| Gross loans incl. SB1 Boligkreditt /SB1 | ||||||
| 185,165 | 182,017 | 197,393 | Næringskreditt | 208,900 | 191,976 | 195,353 |
| 46,650 | 46,675 | 57,051 of which SpareBank 1 Boligkreditt | 57,051 | 46,675 | 46,650 | |
| 1,402 | 1,329 | 1,601 of which SpareBank 1 Næringskreditt | 1,601 | 1,329 | 1,402 | |
| Total Gross loans to and receivables | ||||||
| 137,113 | 134,013 | 138,740 | from customers | 150,247 | 143,972 | 147,301 |
| - Loan loss allowance on amortised cost | ||||||
| 1,250 | 1,411 | 921 | loans | 993 | 1,472 | 1,313 |
| 97 | 95 | 92 - Loan loss allowance on loans at FVOCI | 92 | 95 | 97 | |
| Net loans to and receivables from | ||||||
| 135,766 | 132,507 | 137,727 | customers | 149,162 | 142,404 | 145,890 |
| January - September | Third quarter | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2022 | 2021 | 2022 | 2021 | 2021 | |||||||||||
| Parent Bank (NOKm) | RM | CM | Total | RM | CM | Total | RM | CM | Total | RM | CM | Total | RM | CM | Total |
| Change in provision for expected credit losses |
3 | -68 | -65 | -14 | 102 | 88 | 10 | 7 | 17 | -2 | 24 | 22 | -11 | 39 | 27 |
| Actual loan losses on commitments exceeding provisions made |
4 | 27 | 31 | 8 | 23 | 31 | 3 | -5 | -3 | 3 | 1 | 4 | 10 | 107 | 117 |
| Recoveries on commitments previously written-off |
-5 | -6 | -11 | -5 | -0 | -5 | -1 | -2 | -3 | -2 | -0 | -2 | -9 | -1 | -10 |
| Losses for the period on loans and guarantees |
2 | -47 | -45 | -11 | 125 | 115 | 11 | 1 | 12 | -1 | 25 | 24 | -10 | 145 | 134 |
| January - September | 3rd quarter | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2022 | 2021 | 2022 | 2021 | 2021 | |||||||||||
| Group (NOKm) | RM | CM | Total | RM | CM | Total | RM | CM | Total | RM | CM | Total | RM | CM | Total |
| Change in provision for expected credit losses |
10 | -65 | -55 | -23 | 104 | 81 | 14 | 12 | 26 | -3 | 27 | 24 | -20 | 50 | 30 |
| Actual loan losses on commitments exceeding provisions made |
9 | 32 | 41 | 25 | 29 | 53 | 5 | -5 | -0 | 7 | 2 | 9 | 30 | 112 | 142 |
| Recoveries on commitments previously written-off |
-5 | -7 | -11 | -5 | -0 | -5 | -1 | -2 | -3 | -2 | -0 | -2 | -9 | -3 | -12 |
| Losses for the period on loans and guarantees |
14 | -39 | -26 | -3 | 132 | 129 | 17 | 5 | 22 | 3 | 28 | 31 | 1 | 159 | 161 |
| Net write | ||||
|---|---|---|---|---|
| Change in | offs | |||
| Parent Bank (NOKm) | 1 Jan 22 | provision | /recoveries | 30 Sep 22 |
| Loans as amortised cost- CM | 1,298 | -68 | -260 | 969 |
| Loans as amortised cost- RM | 31 | 6 | -5 | 31 |
| Loans at fair value over OCI- RM | 128 | -3 | - | 125 |
| Loans at fair value over OCI- CM | 1 | 1 | - | 2 |
| Provision for expected credit losses on loans and guarantees | 1,458 | -65 | -265 | 1,127 |
| Presented as | ||||
| Provision for loan losses | 1,348 | -69 | -265 | 1,014 |
| Other debt- provisons | 79 | 1 | - | 79 |
| Other comprehensive income - fair value adjustment | 31 | 3 | - | 34 |
| Net write | ||||
| Change in | offs | |||
| Parent Bank (NOKm) | 1 Jan 21 | provision | /recoveries | 30 Sep 21 |
| Loans as amortised cost- CM | 1,377 | 102 | -19 | 1,459 |
| Loans as amortised cost- RM | 35 | 8 | -9 | 33 |
| Loans at fair value over OCI- RM | 147 | -21 | - | 126 |
| Loans at fair value over OCI- CM | 0 | 0 | - | 1 |
| Provision for expected credit losses on loans and guarantees | 1,559 | 88 | -29 | 1,619 |
| Presented as | ||||
| Provision for loan losses | 1,446 | 89 | -29 | 1,506 |
| Other debt- provisons | 81 | 1 | - | 82 |
| Other comprehensive income - fair value adjustment | 32 | -1 | - | 31 |
| Net write | ||||
| Change in | offs | |||
| Parent Bank (NOKm) | 1 Jan 21 | provision | /recoveries | 31 Dec 21 |
| Loans as amortised cost- CM | 1,377 | 38 | -117 | 1,298 |
| Loans as amortised cost- RM | 35 | 8 | -12 | 31 |
| Loans at fair value over OCI- RM | 147 | -19 | - | 128 |
| Loans at fair value over OCI- CM | 0 | 1 | - | 1 |
| Provision for expected credit losses on loans and guarantees | 1,559 | 27 | -129 | 1,458 |
| Presented as | ||||
| Provision for loan losses | 1,446 | 30 | -129 | 1,348 |
| Other debt- provisons | 81 | -2 | - | 79 |
| Other comprehensive income - fair value adjustment | 32 | -1 | - | 31 |
| Net write | ||||
|---|---|---|---|---|
| Change in | offs | |||
| Group (NOKm) | 1 Jan 22 | provision | /recoveries | 30 Sep 22 |
| Loans as amortised cost- CM | 1,343 | -65 | -261 | 1,016 |
| Loans as amortised cost- RM | 49 | 12 | -5 | 56 |
| Loans at fair value over OCI- RM | 128 | -3 | - | 125 |
| Loans at fair value over OCI- CM | 1 | 11 | -1 | 2 |
| Provision for expected credit losses on loans and guarantees | 1,520 | -45 | -268 | 1,199 |
| Presented as | ||||
| Provision for loan losses | 1,410 | -59 | -267 | 1,085 |
| Other debt- provisons | 79 | 1 | - | 79 |
| Other comprehensive income - fair value adjustment | 31 | 3 | - | 34 |
| Net write | ||||
| Change in | offs | |||
| Group (NOKm) | 1 Jan 21 | provision | /recoveries | 30 Sep 21 |
| Loans as amortised cost- CM | 1,421 | 103 | -20 | 1,503 |
| Loans as amortised cost- RM | 62 | -2 | -9 | 51 |
| Loans at fair value over OCI- RM | 147 | -21 | - | 126 |
| Loans at fair value over OCI- CM | 0 | 0 | - | 1 |
| Provision for expected credit losses on loans and guarantees | 1,630 | 81 | -30 | 1,680 |
| Presented as | ||||
| Provision for loan losses | 1,517 | 81 | -30 | 1,568 |
| Other debt- provisons | 81 | 1 | - | 82 |
| Other comprehensive income - fair value adjustment | 32 | -1 | - | 31 |
| Net write | ||||
| Change in | offs | |||
| Group (NOKm) | 1 Jan 21 | provision | /recoveries | 31 Dec 21 |
| Loans as amortised cost- CM | 1,421 | 50 | -128 | 1,343 |
| Loans as amortised cost- RM | 62 | -1 | -12 | 49 |
| Loans at fair value over OCI- RM | 147 | -19 | - | 128 |
| Loans at fair value over OCI- CM | 0 | 1 | - | 1 |
| Provision for expected credit losses on loans and guarantees | 1,630 | 30 | -140 | 1,520 |
| Presented as | ||||
| Provision for loan losses | 1,517 | 33 | -140 | 1,410 |
| Other debt- provisons | 81 | -2 | - | 79 |
| Other comprehensive income - fair value adjustment | 32 | -1 | - | 31 |
| 30 Sep 22 | 30 Sep 21 | 31 Dec 2021 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Parent Bank (NOKm) | Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total | ||||||||
| Retail market | ||||||||||||
| Opening balance | 39 | 82 | 36 | 156 | 35 | 97 | 47 | 180 | 35 | 97 | 47 | 180 |
| Transfer to | ||||||||||||
| (from) stage 1 | 20 | -20 | -0 | - | 22 | -22 | -0 | - | 20 | -20 | -0 | - |
| Transfer to | ||||||||||||
| (from) stage 2 | -2 | 2 | -0 | - | -2 | 2 | -0 | - | -2 | 2 | -0 | - |
| Transfer to | ||||||||||||
| (from) stage 3 | -0 | -5 | 5 | - | -0 | -4 | 5 | - | -1 | -6 | 7 | - |
| Net remeasurement of | ||||||||||||
| loss allowances | -26 | 16 | 2 | -8 | -22 | 25 | -5 | -2 | -22 | 24 | -3 | -1 |
| Originations or | ||||||||||||
| purchases | 13 | 11 | 2 | 26 | 14 | 11 | 1 | 26 | 19 | 17 | 1 | 37 |
| Derecognitions | -9 | -20 | -2 | -32 | -10 | -26 | -3 | -38 | -12 | -32 | -4 | -48 |
| Changes due to | ||||||||||||
| changed input | ||||||||||||
| assumptions | 4 | 12 | -0 | 16 | 1 | -1 | - | 0 | 1 | -0 | - | 1 |
| Transfer to | ||||||||||||
| Actual loan losses Closing balance Corporate Market Opening balance (from) stage 1 Transfer to (from) stage 2 Transfer to (from) stage 3 Net remeasurement of loss allowances Originations or purchases Derecognitions Changes due to changed input assumptions Actual loan losses Closing balance Total accrual for loan losses |
0 39 84 34 -5 -1 21 66 -27 -59 - 112 152 |
0 78 268 -33 96 -2 -9 19 -19 5 - 326 404 |
-5 36 871 -1 -91 4 -2 4 -24 -43 -260 456 492 |
-5 154 1,223 - - - 10 89 -70 -98 -260 894 1,048 |
- 37 88 11 -3 -2 -20 23 -16 1 - 83 120 |
- 83 387 -11 3 -26 14 19 -141 9 - 253 337 |
-9 36 823 - - 28 102 112 -1 - -19 1,045 1,080 |
-9 156 1,299 - - - 97 154 -159 11 -19 1,381 1,537 |
0 39 88 15 -5 -2 -26 32 -20 1 - 84 123 |
0 82 387 -15 5 -26 26 21 -145 14 - 268 350 |
-12 36 823 - - 28 38 100 -1 - -117 871 907 |
-12 156 1,299 - - - 39 153 -166 15 -117 1,223 1,379 |
| 30 Sep 22 | 30 Sep 21 | 31 Dec 2021 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Group (NOKm) | Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total | ||||||||
| Retail market | ||||||||||||
| Opening balance | 45 | 89 | 40 | 174 | 42 | 107 | 58 | 207 | 42 | 107 | 58 | 207 |
| Transfer to | ||||||||||||
| (from) stage 1 | 22 | -22 | -0 | - | 23 | -23 | -0 | - | 22 | -22 | -0 | - |
| Transfer to | ||||||||||||
| (from) stage 2 | -3 | 3 | -1 | - | -3 | 3 | -0 | - | -2 | 3 | -0 | - |
| Transfer to | ||||||||||||
| (from) stage 3 | -0 | -5 | 5 | - | -0 | -5 | 6 | - | -1 | -7 | 8 | - |
| Net remeasurement of | ||||||||||||
| loss allowances | -26 | 20 | 3 | -2 | -23 | 27 | -2 | 1 | -23 | 26 | -1 | 2 |
| Originations or | ||||||||||||
| purchases | 18 | 14 | 2 | 33 | 16 | 13 | 3 | 32 | 22 | 20 | 1 | 43 |
| Derecognitions | -11 | -21 | -4 | -35 | -12 | -30 | -8 | -49 | -14 | -37 | -9 | -60 |
| Changes due to | ||||||||||||
| changed input | ||||||||||||
| assumptions | 4 | 11 | -1 | 14 | -0 | -2 | -5 | -7 | -0 | -2 | -4 | -5 |
| Actual loan losses | - | - | -5 | -5 | - | - | -9 | -9 | - | - | -12 | -12 |
| Closing balance | 49 | 89 | 41 | 179 | 43 | 90 | 41 | 174 | 45 | 89 | 40 | 174 |
| Corporate Market | ||||||||||||
| Opening balance | 94 | 278 | 896 | 1,268 | 98 | 399 | 845 | 1,342 | 98 | 399 | 845 | 1,342 |
| Transfer to | ||||||||||||
| (from) stage 1 | 37 | -35 | -1 | - | 16 | -16 | -0 | - | 20 | -20 | -0 | - |
| Transfer to | ||||||||||||
| (from) stage 2 | -6 | 98 | -91 | 0 | -4 | 4 | -0 | - | -7 | 7 | -0 | - |
| Transfer to | ||||||||||||
| (from) stage 3 | -1 | -2 | 4 | - | -2 | -27 | 29 | - | -2 | -27 | 29 | - |
| Net remeasurement of | ||||||||||||
| loss allowances | 21 | -5 | 9 | 25 | -23 | 17 | 108 | 102 | -29 | 31 | 42 | 44 |
| Originations or | ||||||||||||
| purchases | 71 | 20 | 4 | 95 | 26 | 20 | 113 | 159 | 35 | 23 | 112 | 169 |
| Derecognitions | -28 | -20 | -26 | -74 | -17 | -143 | -2 | -162 | -21 | -146 | -2 | -169 |
| Changes due to changed input |
||||||||||||
| assumptions | -61 | 4 | -54 | -112 | -1 | 8 | -2 | 4 | -2 | 12 | -2 | 9 |
| Actual loan losses | - | - | -261 | -261 | - | - | -20 | -20 | - | - | -128 | -128 |
| Closing balance | 125 | 337 | 478 | 941 | 92 | 263 | 1,069 | 1,425 | 94 | 278 | 896 | 1,268 |
| Total accrual for loan | ||||||||||||
| losses | 174 | 426 | 519 | 1,119 | 136 | 353 | 1,110 | 1,599 | 138 | 367 | 936 | 1,442 |
| 30 Sep 22 | 30 Sep 21 | 31 Dec 2021 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Parent Bank and Group (NOKm) |
Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total | ||||||||
| Opening balance | 19 | 55 | 5 | 79 | 27 | 50 | 4 | 81 | 27 | 50 | 4 | 81 |
| Transfer to (from) stage 1 Transfer to |
3 | -3 | -0 | - | 5 | -5 | -0 | - | 6 | -6 | -0 | - |
| (from) stage 2 Transfer to |
-1 | 1 | -0 | - | -6 | 6 | - | - | -7 | 7 | - | - |
| (from) stage 3 Net remeasurement of |
-0 | -0 | 0 | - | -0 | -1 | 1 | - | -0 | -1 | 1 | - |
| loss allowances Originations or |
-11 | -1 | 5 | -7 | -7 | 7 | -2 | -2 | -9 | 4 | 0 | -4 |
| purchases | 10 | 6 | 0 | 16 | 8 | 3 | 0 | 10 | 7 | 4 | 0 | 11 |
| Derecognitions Changes due to changed input |
-2 | -6 | -0 | -9 | -5 | -4 | -0 | -9 | -6 | -5 | -0 | -11 |
| assumptions | -1 | 0 | 0 | 0 | 0 | 1 | - | 2 | 0 | 2 | - | 2 |
| Actual loan losses | - | - | - | - | - | - | - | - | - | - | - | - |
| Closing balance | 18 | 51 | 10 | 79 | 22 | 57 | 3 | 82 | 19 | 55 | 5 | 79 |
| Of which Retail market Corporate Market |
2 77 |
3 79 |
2 76 |
| 30 Sep 22 | 30 Sep 21 | 31 Dec 2021 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Parent Bank (NOKm) | Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total | ||||||||
| Agriculture and forestry | 3 | 32 | 12 | 47 | 2 | 31 | 3 | 36 | 2 | 31 | 6 | 39 |
| Fisheries and hunting | 10 | 11 | 0 | 21 | 7 | 0 | 0 | 8 | 6 | 7 | 0 | 13 |
| Sea farming industries | 2 | 1 | 1 | 4 | 1 | 0 | 0 | 2 | 1 | 0 | 0 | 2 |
| Manufacturing | 5 | 42 | 4 | 50 | 7 | 25 | 14 | 46 | 5 | 36 | 15 | 56 |
| Construction, power | ||||||||||||
| and water supply | 20 | 23 | 9 | 52 | 12 | 12 | 22 | 46 | 13 | 16 | 14 | 43 |
| Retail trade, hotels | ||||||||||||
| and restaurants | 9 | 28 | 2 | 39 | 7 | 28 | 9 | 44 | 8 | 28 | 11 | 46 |
| Maritime sector | 18 | 144 | 200 | 362 | 14 | 122 | 730 | 866 | 14 | 118 | 555 | 687 |
| Property management | 27 | 47 | 28 | 102 | 18 | 47 | 35 | 100 | 20 | 50 | 36 | 105 |
| Business services | 14 | 23 | 198 | 235 | 11 | 15 | 223 | 249 | 13 | 12 | 222 | 247 |
| Transport and other | ||||||||||||
| services | 8 | 11 | 16 | 35 | 7 | 8 | 10 | 25 | 7 | 6 | 17 | 30 |
| Public administration | 0 | - | - | 0 | 0 | - | - | 0 | 0 | 0 | 0 | 0 |
| Other sectors | 1 | 0 | - | 1 | 0 | 0 | - | 1 | 0 | 0 | 0 | 0 |
| Wage earners | 1 | 42 | 24 | 67 | 2 | 47 | 32 | 82 | 2 | 47 | 30 | 79 |
| Total provision for | ||||||||||||
| losses on loans | 117 | 404 | 492 | 1,014 | 89 | 337 | 1,080 | 1,506 | 91 | 350 | 907 | 1,348 |
| loan loss allowance on | ||||||||||||
| loans at FVOCI | 34 | 34 | 31 | 31 | 31 | 31 | ||||||
| Total loan loss | ||||||||||||
| allowance | 152 | 404 | 492 | 1,048 | 120 | 337 | 1,080 | 1,537 | 123 | 350 | 907 | 1,379 |
| 30 Sep 22 | 30 Sep 21 | 31 Dec 2021 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Group (NOKm) | Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total | ||||||||
| Agriculture and forestry | 4 | 34 | 13 | 51 | 3 | 32 | 4 | 39 | 3 | 33 | 7 | 42 |
| Fisheries and hunting | 10 | 11 | 0 | 21 | 7 | 0 | 0 | 8 | 6 | 7 | 0 | 13 |
| Sea farming industries | 3 | 1 | 4 | 8 | 2 | 1 | 0 | 3 | 1 | 1 | 1 | 3 |
| Manufacturing | 9 | 45 | 6 | 59 | 9 | 27 | 20 | 56 | 7 | 38 | 21 | 66 |
| Construction, power | ||||||||||||
| and water supply | 24 | 26 | 12 | 62 | 15 | 15 | 25 | 54 | 16 | 19 | 18 | 53 |
| Retail trade, hotels | ||||||||||||
| and restaurants | 10 | 29 | 5 | 44 | 8 | 28 | 11 | 47 | 9 | 28 | 16 | 53 |
| Maritime sector | 18 | 144 | 200 | 362 | 14 | 122 | 730 | 866 | 14 | 118 | 555 | 687 |
| Property management | 28 | 48 | 28 | 103 | 18 | 48 | 36 | 101 | 20 | 50 | 36 | 106 |
| Business services | 16 | 24 | 202 | 242 | 12 | 16 | 226 | 255 | 14 | 14 | 227 | 255 |
| Transport and other | ||||||||||||
| services | 11 | 14 | 21 | 46 | 9 | 10 | 21 | 40 | 8 | 7 | 22 | 37 |
| Public administration | 0 | - | - | 0 | 0 | - | 0 | 0 | 0 | 0 | 0 | 0 |
| Other sectors | 1 | 0 | - | 1 | 0 | 0 | - | 1 | 0 | 0 | 0 | 0 |
| Wage earners | 8 | 52 | 28 | 88 | 7 | 53 | 36 | 97 | 7 | 53 | 34 | 95 |
| Total provision for | ||||||||||||
| losses on loans | 140 | 426 | 519 | 1,085 | 105 | 353 | 1,110 | 1,568 | 107 | 367 | 936 | 1,410 |
| loan loss allowance on | ||||||||||||
| loans at FVOCI | 34 | 34 | 31 | 31 | 31 | 31 | ||||||
| Total loan loss | ||||||||||||
| allowance | 174 | 426 | 519 | 1,119 | 136 | 353 | 1,110 | 1,599 | 138 | 367 | 936 | 1,442 |
| 30 Sep 22 | 30 Sep 21 | 31 Dec 21 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Parent Bank (NOKm) | Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total | ||||||||
| Retail Market | ||||||||||||
| Opening balance | 82,299 | 3,892 | 444 | 86,636 | 73,297 | 4,430 | 381 | 78,108 | 73,297 | 4,430 | 381 | 78,108 |
| Transfer to | ||||||||||||
| stage 1 | 1,164 | -1,148 | -16 | - | 1,216 | -1,212 | -4 | - | 1,007 | -1,002 | -6 | - |
| Transfer to | ||||||||||||
| stage 2 | -1,133 | 1,142 | -9 | - | -1,009 | 1,012 | -3 | - | -1,325 | 1,332 | 1 | - |
| Transfer to | ||||||||||||
| stage 3 | -25 | -96 | 121 | - | -50 | -77 | 127 | - | -61 | -87 | 148 | - |
| Net increase/decrease | ||||||||||||
| amount existing loans | -2,241 | -90 | -14 | -2,345 | -2,228 | -72 | -20 | -2,319 | -2,513 | -102 | -15 | -2,630 |
| New loans | 31,416 | 695 | 87 | 32,197 | 35,597 | 721 | 70 | 36,388 | 43,464 | 1,198 | 118 | 44,780 |
| Derecognitions | -31,882 | -1,230 | -113 | -33,226 | -26,274 | -1,532 | -128 | -27,935 | -31,569 | -1,876 | -156 | -33,601 |
| Financial assets with | ||||||||||||
| actual loan losses | 0 | -1 | -9 | -10 | -0 | -1 | -16 | -17 | -0 | -1 | -20 | -21 |
| Closing balance | 79,599 | 3,163 | 490 | 83,253 | 80,549 | 3,268 | 408 | 84,225 | 82,299 | 3,892 | 444 | 86,636 |
| Corporate Market | ||||||||||||
| Opening balance | 38,359 | 5,186 | 2,656 | 46,201 | 35,587 | 5,979 | 1,702 | 43,268 | 35,587 | 5,979 | 1,702 | 43,268 |
| Transfer to | ||||||||||||
| stage 1 | 978 | -963 | -15 | - | 414 | -414 | - | - | 647 | -647 | -0 | - |
| Transfer to | ||||||||||||
| stage 2 | -1,593 | 2,463 | -869 | - | -690 | 690 | -0 | - | -1,434 | 1,434 | - | - |
| Transfer to | ||||||||||||
| stage 3 | -64 | -73 | 137 | - | -16 | -594 | 609 | - | -43 | -593 | 637 | - |
| Net increase/decrease | ||||||||||||
| amount existing loans | -274 | -152 | 49 | -377 | -963 | -162 | -27 | -1,152 | -1,202 | -196 | -39 | -1,437 |
| New loans | 12,908 | 1,016 | 93 | 14,017 | 9,799 | 110 | 1,305 | 11,214 | 13,125 | -550 | 1,074 | 13,649 |
| Derecognitions | -7,590 | -912 | -504 | -9,006 | -6,431 | -745 | -711 | -7,888 | -8,320 | -236 | -524 | -9,081 |
| Financial assets with | ||||||||||||
| actual loan losses | -2 | -5 | -59 | -66 | 0 | 0 | -21 | -21 | -1 | -4 | -193 | -199 |
| Closing balance | 42,721 | 6,560 | 1,489 | 50,770 | 37,699 | 4,865 | 2,856 | 45,420 | 38,359 | 5,186 | 2,656 | 46,201 |
| Fixed interest loans at | 4,718 | 4,718 | 4,367 | 4,367 | 4,276 | - | - | 4,276 | ||||
| FV | ||||||||||||
| Total gross loans at | ||||||||||||
| the end of the period | 127,039 | 9,723 | 1,979 138,740 122,615 | 8,133 | 3,264 134,013 124,934 | 9,079 | 3,100 137,113 |
| 30 Sep 22 | 30 Sep 21 | 31 Dec 21 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Group (NOKm) | Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total Stage 1 Stage 2 Stage 3 | Total | ||||||||
| Retail Market | ||||||||||||
| Opening balance | 87,577 | 4,612 | 531 | 92,721 | 78,206 | 5,208 | 453 | 83,867 | 78,206 | 5,208 | 453 | 83,867 |
| Transfer to | ||||||||||||
| stage 1 | 1,358 | -1,341 | -17 | - | 1,418 | -1,413 | -4 | - | 1,227 | -1,221 | -6 | - |
| Transfer to | ||||||||||||
| stage 2 | -1,447 | 1,462 | -15 | - | -1,245 | 1,253 | -7 | - | -1,598 | 1,609 | -11 | - |
| Transfer to | ||||||||||||
| stage 3 | -31 | -126 | 157 | - | -59 | -119 | 178 | - | -74 | -132 | 206 | - |
| Net increase/decrease | ||||||||||||
| amount existing loans | -1,956 | -134 | -20 | -2,110 | -2,254 | -106 | -29 | -2,388 | -2,599 | -154 | -28 | -2,782 |
| New loans | 33,803 | 912 | 92 | 34,807 | 37,915 | 892 | 74 | 38,881 | 46,190 | 1,465 | 125 | 47,781 |
| Derecognitions | -33,780 | -1,427 | -131 | -35,338 | -28,197 | -1,772 | -142 | -30,111 | -33,775 | -2,161 | -189 | -36,125 |
| Financial assets with | ||||||||||||
| actual loan losses | -0 | -1 | -9 | -10 | -0 | -1 | -16 | -17 | -0 | -1 | -20 | -21 |
| Closing balanse | 85,524 | 3,958 | 587 | 90,070 | 85,785 | 3,941 | 507 | 90,233 | 87,577 | 4,612 | 531 | 92,721 |
| Corporate Market | ||||||||||||
| Opening balance | 41,855 | 5,768 | 2,759 | 50,382 | 38,107 | 6,587 | 1,802 | 46,496 | 38,107 | 6,587 | 1,802 | 46,496 |
| Transfer to | ||||||||||||
| stage 1 | 1,224 | -1,184 | -40 | - | 649 | -646 | -3 | - | 879 | -876 | -2 | - |
| Transfer to | ||||||||||||
| stage 2 | -1,862 | 2,739 | -877 | - | -985 | 987 | -3 | - | -1,795 | 1,797 | -1 | - |
| Transfer to | ||||||||||||
| stage 3 | -75 | -92 | 167 | - | -26 | -617 | 643 | - | -57 | -626 | 683 | - |
| Net increase/decrease | ||||||||||||
| amount existing loans | -301 | -202 | 45 | -457 | -480 | -198 | -33 | -711 | -652 | -257 | -53 | -963 |
| New loans | 14,284 | 1,079 | 108 | 15,471 | 10,685 | 179 | 1,306 | 12,170 | 14,533 | -455 | 1,085 | 15,164 |
| Derecognitions | -8,225 | -1,016 | -552 | -9,793 | -6,936 | -875 | -751 | -8,562 | -9,159 | -397 | -561 | -10,117 |
| Financial assets with | ||||||||||||
| actual loan losses | -2 | -5 | -59 | -66 | 0 | 0 | -21 | -21 | -1 | -4 | -193 | -199 |
| Closing balance | 46,897 | 7,087 | 1,551 | 55,536 | 41,014 | 5,416 | 2,941 | 49,372 | 41,855 | 5,768 | 2,759 | 50,382 |
| Fixed interest loans at FV |
4,640 | 4,640 | 4,367 | 4,367 | 4,198 | 4,198 | ||||||
| Total gross loans at | ||||||||||||
| the end of the period | 137,062 | 11,046 | 2,139 150,247 131,166 | 9,357 | 3,448 143,972 133,630 | 10,381 | 3,290 147,301 |
| Parent Bank | Group | |||||
|---|---|---|---|---|---|---|
| 31 Dec 21 | 30 Sep 21 | 30 Sep 22 (NOKm) | 30 Sep 22 | 30 Sep 21 | 31 Dec 21 | |
| 1,958 | 2,247 | 2,286 Agriculture and forestry | 2,286 | 2,247 | 1,958 | |
| 991 | 964 | 1,285 Fisheries and hunting | 1,285 | 964 | 991 | |
| 1,050 | 915 | 685 Sea farming industries | 685 | 915 | 1,050 | |
| 2,562 | 2,297 | 3,149 Manufacturing | 3,149 | 2,297 | 2,562 | |
| 5,535 | 5,293 | 6,423 Construction, power and water supply | 6,423 | 5,293 | 5,535 | |
| 6,649 | 5,436 | 5,138 Retail trade, hotels and restaurants | 5,138 | 5,436 | 6,649 | |
| 1,006 | 1,102 | 1,071 Maritime sector | 1,071 | 1,102 | 1,006 | |
| 5,692 | 6,170 | 6,560 Property management | 6,495 | 6,112 | 5,635 | |
| 11,469 | 11,534 | 13,416 Business services | 13,416 | 11,534 | 11,469 | |
| 9,247 | 9,494 | 9,007 Transport and other services provision | 8,521 | 9,057 | 8,750 | |
| 16,826 | 16,300 | 20,624 Public administration | 20,624 | 16,300 | 16,826 | |
| 4,453 | 4,610 | 3,836 Other sectors | 3,797 | 4,468 | 4,267 | |
| 67,439 | 66,362 | 73,482 Total | 72,892 | 65,725 | 66,697 | |
| 44,589 | 43,967 | 47,666 Wage earners | 47,666 | 43,967 | 44,589 | |
| 112,028 | 110,328 | 121,148 Total deposits | 120,558 | 109,691 | 111,286 |
| Parent bank | Group | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| January - | January - | |||||||||
| Third quarter | September | September | Third quarter | |||||||
| 2021 | 2021 | 2022 | 2021 | 2022 (NOKm) | 2022 | 2021 | 2022 | 2021 | 2021 | |
| Interest income | ||||||||||
| Interest income from loans to and claims | ||||||||||
| on central banks and credit institutions | ||||||||||
| 128 | 27 | 107 | 90 | 231 | (amortised cost) | 99 | 22 | 53 | 5 | 33 |
| Interest income from loans to and claims | ||||||||||
| 1,654 | 421 | 644 | 1,206 | 1,700 | on customers (amortised cost) | 2,163 | 1,591 | 812 | 549 | 2,169 |
| Interest income from loans to and claims | ||||||||||
| 1,285 | 320 | 469 | 943 | 1,232 | on customers (FVOCI) | 1,232 | 954 | 469 | 323 | 1,300 |
| Interest income from loans to and claims | ||||||||||
| 116 | 29 | 33 | 88 | 91 | on customers (FVPL) | 91 | 88 | 33 | 29 | 116 |
| Interest income from money market | ||||||||||
| instruments, bonds and other fixed | ||||||||||
| 279 | 62 | 149 | 199 | 359 | income securities | 356 | 197 | 148 | 61 | 276 |
| - | - | - | - | - Other interest income | 19 | 17 | 7 | 5 | 23 | |
| 3,462 | 858 | 1,402 | 2,527 | 3,613 Total interest income | 3,961 | 2,869 | 1,521 | 973 | 3,916 | |
| Interest expense | ||||||||||
| Interest expenses on liabilities to credit | ||||||||||
| 51 | 9 | 77 | 32 | 152 | institutions | 163 | 35 | 82 | 10 | 55 |
| Interest expenses relating to deposits | ||||||||||
| 547 | 130 | 423 | 372 | 917 | from and liabilities to customers | 906 | 367 | 418 | 128 | 540 |
| Interest expenses related to the issuance | ||||||||||
| 395 | 95 | 167 | 297 | 400 | of securities | 400 | 297 | 167 | 95 | 395 |
| 33 | 8 | 16 | 24 | 43 Interest expenses on subordinated debt | 45 | 26 | 17 | 8 | 35 | |
| 8 | 2 | 2 | 6 | 6 Other interest expenses | 18 | 15 | 7 | 5 | 20 | |
| 75 | 19 | 20 | 57 | 59 Guarantee fund levy | 59 | 57 | 20 | 19 | 75 | |
| 1,109 | 263 | 705 | 788 | 1,576 Total interest expense | 1,591 | 796 | 710 | 266 | 1,120 | |
| 2,353 | 595 | 697 | 1,739 | 2,037 Net interest income | 2,370 | 2,073 | 811 | 707 | 2,796 |
| Parent bank | Group | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| January - | January - | |||||||||
| Third quarter | September | September | Third quarter | |||||||
| 2021 | 2021 | 2022 | 2021 | 2022 (NOKm) | 2022 | 2021 | 2022 | 2021 | 2021 | |
| Commission income | ||||||||||
| 76 | 17 | 19 | 51 | 50 Guarantee commission | 47 | 49 | 17 | 16 | 73 | |
| - | - | - | - | - Broker commission | 205 | 221 | 66 | 69 | 291 | |
| 63 | 18 | 11 | 48 | 32 Portfolio commission, savings products | 32 | 48 | 11 | 18 | 63 | |
| Commission from SpareBank 1 | ||||||||||
| 450 | 123 | 63 | 348 | 224 | Boligkreditt | 224 | 348 | 63 | 123 | 450 |
| Commission from SpareBank 1 | ||||||||||
| 14 | 3 | 4 | 11 | 12 | Næringskreditt | 12 | 11 | 4 | 3 | 14 |
| 413 | 107 | 129 | 294 | 346 Payment transmission services | 343 | 291 | 128 | 106 | 409 | |
| 214 | 54 | 60 | 159 | 176 Commission from insurance services | 176 | 159 | 60 | 54 | 214 | |
| 77 | 19 | 22 | 58 | 70 Other commission income | 64 | 53 | 20 | 17 | 69 | |
| 1,306 | 340 | 307 | 969 | 909 Total commission income | 1,102 | 1,179 | 369 | 405 | 1,583 | |
| Commission expenses | ||||||||||
| 84 | 24 | 22 | 60 | 58 Payment transmission services | 81 | 83 | 29 | 31 | 115 | |
| 13 | 3 | 3 | 10 | 8 Other commission expenses | 82 | 69 | 30 | 23 | 92 | |
| 97 | 27 | 25 | 69 | 66 Total commission expenses | 163 | 152 | 60 | 54 | 207 | |
| - | - | - | ||||||||
| Other operating income | ||||||||||
| 26 | 3 | 8 | 21 | 22 Operating income real property | 21 | 21 | 8 | 3 | 27 | |
| Property administration and sale of | ||||||||||
| - | - | - | - | - | property | 119 | 120 | 39 | 38 | 150 |
| - | - | - | - | - Securities trading | 379 | 561 | 57 | 110 | 719 | |
| - | - | - | - | - Accountant's fees | 437 | 416 | 115 | 114 | 529 | |
| 21 | 6 | 9 | 10 | 15 Other operating income | 25 | 17 | 11 | 7 | 31 | |
| 47 | 9 | 17 | 31 | 36 Total other operating income | 982 | 1,134 | 230 | 272 | 1,456 | |
| Total net commission income and | ||||||||||
| 1,256 | 321 | 298 | 930 | 880 | other operating income | 1,921 | 2,161 | 540 | 623 | 2,832 |
| Parent bank | Group | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Third quarter | January - September |
January - September |
Third quarter | ||||||
| 2021 | 2021 | 2022 | 2021 | 2022 (NOKm) | 2022 | 2021 | 2022 | 2021 | 2021 |
| 265 | 62 | 71 | 192 | 217 IT costs | 286 | 262 | 95 | 85 | 359 |
| 10 | 3 | 3 | 8 | 9 Postage and transport of valuables | 11 | 10 | 3 | 4 | 14 |
| 53 | 14 | 12 | 40 | 41 Marketing | 66 | 56 | 18 | 19 | 77 |
| 95 | 24 | 19 | 74 | 57 Ordinary depreciation | 100 | 149 | 32 | 56 | 189 |
| 44 | 9 | 11 | 32 | 36 Operating expenses, real properties | 51 | 47 | 18 | 14 | 57 |
| 143 | 36 | 40 | 105 | 120 Purchased services | 178 | 167 | 63 | 60 | 224 |
| 134 | 27 | 34 | 88 | 101 Other operating expense | 132 | 119 | 42 | 38 | 190 |
| 745 | 176 | 190 | 540 | 580 Total other operating expenses | 825 | 809 | 271 | 275 | 1,111 |
| Parent Bank | Group | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Third quarter | January - | September | January - September |
Third quarter | ||||||
| 2021 | 2021 | 2022 | 2021 | 2022 (NOKm) | 2022 | 2021 | 2022 | 2021 | 2021 | |
| Valued at fair value through profit/loss | ||||||||||
| -433 | -94 | -100 | -293 | -479 Value change in interest rate instruments | -388 | -194 | -67 | -72 | -283 | |
| Value change in derivatives/hedging | ||||||||||
| Net value change in hedged bonds and | ||||||||||
| -6 3 |
13 | -7 | 11 | derivatives* | 11 | -7 | 13 | 3 | -6 | |
| Net value change in hedged fixed rate | ||||||||||
| 12 -12 |
-29 | 0 | -66 | loans and derivatives | -66 | 0 | -29 | -12 | 12 | |
| 301 96 |
122 | 232 | 386 Other derivatives | 503 | 263 | 150 | 98 | 332 | ||
| Income from equity instruments | ||||||||||
| Income from owner interests | 248 | 519 | 109 | 179 | 705 | |||||
| 726 -0 |
- | 709 | 574 Dividend from owner instruments | |||||||
| Value change and gain/loss on owner | ||||||||||
| 8 13 |
- | 8 | 4 | instruments | 4 | -2 | - | 0 | 13 | |
| 6 2 |
3 | 5 | 9 Dividend from equity instruments | 13 | 21 | 8 | 1 | 22 | ||
| Value change and gain/loss on equity | ||||||||||
| -4 -7 |
-8 | 1 | -19 | instruments | 32 | 162 | -66 | 36 | 163 | |
| Total net income from financial assets and liabilities at fair value through |
||||||||||
| 610 1 |
1 | 656 | 422 | profit/(loss) | 358 | 764 | 117 | 232 | 959 | |
| Valued at amortised cost | ||||||||||
| Value change in interest rate instruments | ||||||||||
| -2 -0 |
0 | -2 | -0 | held to maturity | -0 | -2 | 0 | 0 | -2 | |
| Total net income from financial assets | ||||||||||
| -2 -0 |
0 | -2 | -0 | and liabilities at amortised cost | -0 | -2 | 0 | 0 | -2 | |
| 72 15 |
30 | 47 | 69 Total net gain from currency trading | 69 | 46 | 30 | 16 | 70 | ||
| Total net return on financial | ||||||||||
| 680 17 |
32 | 700 | 491 | investments | 427 | 808 | 148 | 248 | 1,026 | |
| * Fair value hedging | ||||||||||
| Changes in fair value on hedging | ||||||||||
| -664 | -106 657 109 |
-781 794 |
-460 454 |
-2,144 | instrument 2,156 Changes in fair value on hedging item |
-2,144 2,156 |
-460 454 |
-781 794 |
-106 109 |
-664 657 |
| -6 3 |
13 | -7 | 11 | Net Gain or Loss from hedge accounting |
11 | -7 | 13 | 3 | -6 | |
| Parent Bank | Group | |||||
|---|---|---|---|---|---|---|
| 31 Dec 21 | 30 Sep 21 | 30 Sep 22 (NOKm) | 30 Sep 22 | 30 Sep 21 | 31 Dec 21 | |
| 3 | - | 3 Deferred tax asset | 79 | 97 | 90 | |
| 84 | 86 | 106 Fixed assets | 229 | 211 | 210 | |
| 253 | 265 | 231 Right to use assets | 456 | 468 | 460 | |
| 152 | 121 | 110 Earned income not yet received | 144 | 156 | 186 | |
| 20 | 2,225 | 645 Accounts receivable, securities | 1,182 | 2,823 | 300 | |
| 62 | 112 | 233 Pension assets | 233 | 112 | 62 | |
| 508 | 452 | 1,343 Other assets | 1,639 | 741 | 752 | |
| 1,082 | 3,261 | 2,671 Total other assets | 3,962 | 4,609 | 2,062 |
| Parent Bank | Group | |||||
|---|---|---|---|---|---|---|
| 31 Dec 21 | 30 Sep 21 | 30 Sep 22 (NOKm) | 30 Sep 22 | 30 Sep 21 | 31 Dec 21 | |
| - | 8 | 43 Deferred tax | 99 | 81 | 56 | |
| 513 | 350 | 615 Payable tax | 682 | 440 | 583 | |
| 12 | 11 | 12 Capital tax | 12 | 11 | 12 | |
| 118 | 88 | 44 Accrued expenses and received, non-accrued income | 594 | 706 | 774 | |
| 347 | 307 | 486 Provision for accrued expenses and commitments | 486 | 307 | 347 | |
| 78 | 82 | 79 Losses on guarantees and unutilised credits | 79 | 82 | 78 | |
| 8 | 10 | 7 Pension liabilities | 7 | 10 | 8 | |
| 262 | 274 | 241 Lease liabilities | 473 | 481 | 476 | |
| 84 | 57 | 79 Drawing debt | 79 | 57 | 84 | |
| 92 | 1 | 64 Creditors | 144 | 33 | 150 | |
| 157 | 2,052 | 306 Debt from securities | 701 | 2,621 | 351 | |
| - | - | - Equity Instruments | 8 | 90 | 31 | |
| 185 | 323 | 241 Other liabilities | 309 | 405 | 266 | |
| 1,855 | 3,561 | 2,217 Total other liabilites | 3,672 | 5,323 | 3,215 |
| Group | |||||
|---|---|---|---|---|---|
| Fallen due/ | |||||
| Change in securities debt (NOKm) | 31 Dec 21 | Issued | Redeemed | Other changes | 30 Sep 22 |
| Bond debt, nominal value | 36,805 | 9,625 | 6,397 | 1,267 | 41,301 |
| Senior non preferred, nominal value | 3,500 | 3,600 | - | -41 | 7,059 |
| Value adjustments | -152 | - | - | -2,298 | -2,450 |
| Accrued interest | 178 | - | - | 70 | 248 |
| Total | 40,332 | 13,225 | 6,397 | -1,002 | 46,158 |
| Change in subordinated debt and hybrid equity (NOKm) |
31 Dec 21 | Issued | Fallen due/ Redeemed |
Other changes | 30 Sep 22 |
|---|---|---|---|---|---|
| Ordinary subordinated loan capital, nominal value |
1,793 | 1,000 | 750 | - | 2,043 |
| Accrued interest | 3 | - | - | 8 | 11 |
| Total | 1,796 | 1,000 | 750 | 8 | 2,054 |
Fair value of financial instruments that are traded in the active markets is based on market price on the balance sheet date. A market is considered active if market prices are easily and regularly available from a stock exchange, dealer, broker, industry group, price-setting service or regulatory authority, and these prices represent actual and regularly occurring market transactions at an arm's length. This category also includes quoted shares and Treasury bills.
Level 2 consists of instruments that are valued by the use of information that does not consist in quoted prices, but where the prices are directly or indirectly observable for the assets or liabilities concerned, and which also include quoted prices in non-active markets.
If valuation data are not available for level 1 and 2, valuation methods are applied that are based on non-observable information.
| Assets (NOKm) | Level 1 | Level 2 | Level 3 | Total |
|---|---|---|---|---|
| Financial assets at fair value through profit/loss | ||||
| - Derivatives | 0 | 7,479 | - | 7,480 |
| - Bonds and money market certificates | 2,346 | 28,215 | - | 30,561 |
| - Equity instruments | 1,261 | 102 | 611 | 1,974 |
| - Fixed interest loans | - | 78 | 4,640 | 4,718 |
| Financial assets through other comprehensive income | ||||
| - Loans at fair value through other comprehensive income | - | - | 79,839 | 79,839 |
| Total assets | 3,608 | 35,874 | 85,090 | 124,571 |
| Liabilities | Level 1 | Level 2 | Level 3 | Total |
| Financial liabilities through profit/loss | ||||
| - Derivatives | 2 | 8,113 | - | 8,115 |
| - Equity instruments | 8 | - | - | 8 |
| Total liabilities | 11 | 8,113 | - | 8,124 |
| Assets (NOKm) | Level 1 | Level 2 | Level 3 | Total |
|---|---|---|---|---|
| Financial assets at fair value through profit/loss | ||||
| - Derivatives | 1 | 3,731 | - | 3,732 |
| - Bonds and money market certificates | 2,360 | 27,672 | - | 30,032 |
| - Equity instruments | 1,908 | 57 | 559 | 2,525 |
| - Fixed interest loans | - | 43 | 4,246 | 4,289 |
| Financial assets through other comprehensive income | ||||
| - Loans at fair value through other comprehensive income | - | - | 80,832 | 80,832 |
| Total assets | 4,269 | 31,503 | 85,638 | 121,410 |
| Liabilities | Level 1 | Level 2 | Level 3 | Total |
| Financial liabilities through profit/loss | ||||
| - Derivatives | 1 | 3,740 | - | 3,741 |
| - Equity instruments | 90 | - | - | 90 |
| Total liabilities | 91 | 3,740 | - | 3,831 |
| Assets (NOKm) | Level 1 | Level 2 | Level 3 | Total |
|---|---|---|---|---|
| Financial assets at fair value through profit/loss | ||||
| - Derivatives | 4 | 3,221 | - | 3,224 |
| - Bonds and money market certificates | 2,377 | 28,385 | - | 30,762 |
| - Equity instruments | 1,984 | 106 | 564 | 2,654 |
| - Fixed interest loans | - | - | 4,198 | 4,198 |
| Financial assets through other comprehensive income | ||||
| - Loans at fair value through other comprehensive income | - | - | 83,055 | 83,055 |
| Total assets | 4,364 | 31,712 | 87,817 | 123,893 |
| Liabilities | Level 1 | Level 2 | Level 3 | Total |
| Financial liabilities through profit/loss | ||||
| - Derivatives | 0 | 3,909 | - | 3,909 |
| - Equity instruments | 31 | - | - | 31 |
| Total liabilities | 31 | 3,909 | - | 3,940 |
The following table presents the changes in the instruments classified in level 3 as at 30 September 22:
| Equity instruments through profit |
Fixed interest | Loans at fair value through |
||
|---|---|---|---|---|
| (NOKm) | /loss | loans | OCI | Total |
| Opening balance 1 January | 564 | 4,198 | 83,055 | 87,817 |
| Investment in the period | 15 | 1,250 | 29,075 | 30,340 |
| Disposals in the period | -2 | -575 | -32,296 | -32,872 |
| Expected credit loss | - | - | 2 | 2 |
| Gain or loss on financial instruments | 34 | -233 | 3 | -196 |
| Closing balance 30 September 22 | 610 | 4,640 | 79,839 | 85,090 |
The following table presents the changes in the instruments classified in level 3 as at 30 September 21:
| (NOKm) | Equity instruments through profit /loss |
Fixed interest loans |
Loans at fair value through OCI |
Total |
|---|---|---|---|---|
| Opening balance 1 January | 432 | 4,242 | 74,761 | 79,435 |
| Investment in the period | 21 | 922 | 33,175 | 34,118 |
| Disposals in the period | -2 | -827 | -27,123 | -27,952 |
| Expected credit loss | - | - | 19 | 19 |
| Gain or loss on financial instruments | 107 | -91 | 1 | 17 |
| Closing balance 30 September 21 | 559 | 4,246 | 80,832 | 85,638 |
The following table presents the changes in the instruments classified in level 3 as at 31 December 2021:
| (NOKm) | Equity instruments through profit /loss |
Fixed interest loans |
Loans at fair value through OCI |
Total |
|---|---|---|---|---|
| Opening balance 1 January | 432 | 4,242 | 74,761 | 79,435 |
| Investment in period | 26 | 1,201 | 40,891 | 42,118 |
| Disposals in the period | -12 | -1,150 | -32,615 | -33,778 |
| Expected credit loss | - | - | 19 | 19 |
| Gain or loss on financial instruments | 118 | -95 | -1 | 22 |
| Closing balance 31 December | 564 | 4,198 | 83,055 | 87,817 |
The valuation method applied is adapted to each financial instrument, and is intended to utilise as much of the information that is available in the market as possible.
The method for valuation of financial instruments in level 2 and 3 is described in the following:
The loans consist for the most part of fixed interest loans denominated in Norwegian kroner. The value of the fixed interest loans is determined such that agreed interest flows are discounted over the term of the loan by a discount factor that is adjusted for margin requirements. The discount factor is raised by 10 points when calculating sensitivity.
Property Loans at floating interest classified at fair value over other comprehensive income is valued based on nominal amount reduced by expected credit loss. Loans with no significant credit risk detoriation since first recognition is assessed at nominal amount. For loans with a significant increase in credit risk since first recognition or objective evidence of loss, the calculation of expected credit losses over the life of the asset is in line with loan losses for loans at amortised cost. Estimated fair value is the nominal amount reduced by expected lifetime credit loss. If the likelihood of the worst case scenario in the model is doubled, fair value is reduced by NOK 6 million.
Valuation on level 2 is based for the most part on observable market information in the form of interest rate curves, exchange rates and credit margins for the individual credit and the bond's or certificate's characteristics. For paper valued under level 3 the valuation is based on indicative prices from a third party or comparable paper.
Shares that are classified to level 3 include essentially investments in unquoted shares. Among other a total of NOK 521 million in Private Equity investments, property funds, hedge funds and unquoted shares through the company SpareBank SMN 1 Invest. The valuations are in all essentials based on reporting from managers of the funds who utilise cash flow based models or multiples when determining fair value. The Group does not have full access to information on all the elements in these valuations and is therefore unable to determine alternative assumptions.
Financial derivatives at level 2 include for the most part currency futures and interest rate and exchange rate swaps. Valuation is based on observable interest rate curves. In addition the item includes derivatives related to FRAs. These are valued with a basis in observable prices in the market. Derivatives classified to level 2 also include equity derivatives related to SpareBank 1 Markets' market-making activities. The bulk of these derivatives refer to the most sold shares on Oslo Børs, and the valuation is based on the price of the actual /underlying share and observable or calculated volatility.
| (NOKm) | Book value | Effect from change in reasonable possible alternative assumtions |
|---|---|---|
| Fixed interest loans | 4,640 | -13 |
| Equity instruments through profit/loss* | 610 | - |
| Loans at fair value through other comprehensive income | 79,839 | -6 |
* As described above, the information to perform alternative calculations are not available
Liquidity risk is the risk that the group will be unable to refinance its debt or to finance asset increases. Liquidity risk management starts out from the group's overall liquidity strategy which is reviewed and adopted by the board of directors at least once each year. The liquidity strategy reflects the group's moderate risk profile.
The group reduces its liquidity risk through guidelines and limits designed to achieve a diversified balance sheet, both on the asset and liability side. Preparedness plans have been drawn up both for the group and the SpareBank 1 Alliance to handle the liquidity situation in periods of turbulent capital markets. The bank's liquidity situation is stress tested on a monthly basis using various maturities and crisis scenarios: bank-specific, for the financial market in general or a combination of internal and external factors. The group's objective is to survive twelve months of ordinary operations without access to fresh external funding while housing prices fall 30 per cent. In the same period minimum requirements to LCR shall be fulfilled.
The average residual maturity on debt created by issue of securities at the end of the third quarter 2022 was 3.6 years. The overall LCR at the same point was 180 per cent and the average overall LCR in the third quarter was 179 per cent. The LCR in Norwegian kroner and euro at quarter-end was 166 and 405 per cent respectively.
ECC owners share of profit have been calculated based on net profit allocated in accordance to the average number of certificates outstanding in the period. There is no option agreements in relation to the Equity Capital Certificates, diluted net profit is therefore equivalent to Net profit per ECC.
| January - September | |||||
|---|---|---|---|---|---|
| (NOKm) | 2022 | 2021 | 2021 | ||
| Adjusted Net Profit to allocate between ECC owners and Savings Bank | |||||
| Reserve 1) | 1,878 | 2,046 | 2,692 | ||
| Allocated to ECC Owners 2) | 1,201 | 1,308 | 1,722 | ||
| Issues Equity Captial Certificates adjusted for own certificates | 129,341,667 | 129,340,421 | 129,339,665 | ||
| Earnings per Equity Captial Certificate | 9.29 | 10.11 | 13.31 |
| January - September | |||
|---|---|---|---|
| 1) Adjusted Net Profit | 2022 | 2021 | 2021 |
| Net Profit for the group | 2,017 | 2,199 | 2,902 |
| adjusted for non-controlling interests share of net profit | -93 | -113 | -160 |
| Adjusted for Tier 1 capital holders share of net profit | -45 | -40 | -50 |
| Adjusted Net Profit | 1,878 | 2,046 | 2,692 |
| 2) Equity capital certificate ratio (parent bank) (NOKm) | 30.9.22 | 30.9.21 | 31.12.21 |
|---|---|---|---|
| ECC capital | 2,597 | 2,597 | 2,597 |
| Dividend equalisation reserve | 7,007 | 6,556 | 7,007 |
| Premium reserve | 895 | 895 | 895 |
| Unrealised gains reserve | 109 | 153 | 109 |
| Other equity capital | 82 | -1 | - |
| A. The equity capital certificate owners' capital | 10,690 | 10,200 | 10,609 |
| Ownerless capital | 5,918 | 5,664 | 5,918 |
| Unrealised gains reserve | 62 | 86 | 62 |
| Other equity capital | 46 | -1 | - |
| B. The saving bank reserve | 6,025 | 5,749 | 5,980 |
| To be disbursed from gift fund | - | 226 | 547 |
| Dividend declared | - | 401 | 970 |
| Equity ex. profit | 16,716 | 16,577 | 18,106 |
| Equity capital certificate ratio A/(A+B) | 64.0 % | 64.0 % | 64.0 % |
| Equity capital certificate ratio for distribution | 64.0 % | 64.0 % | 64.0 % |
| Group (NOKm) | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 4Q | 3Q |
|---|---|---|---|---|---|---|---|---|---|
| 2022 | 2022 | 2022 | 2021 | 2021 | 2021 | 2021 | 2020 | 2020 | |
| Interest income effective interest method | 1,521 | 1,281 | 1,158 | 1,047 | 973 | 958 | 939 | 945 | 972 |
| Interest expenses | 710 | 480 | 400 | 324 | 266 | 260 | 271 | 258 | 277 |
| Net interest | 811 | 801 | 758 | 723 | 707 | 698 | 668 | 688 | 695 |
| Commission income | 369 | 377 | 357 | 404 | 405 | 400 | 374 | 393 | 399 |
| Commission expenses | 60 | 54 | 50 | 55 | 54 | 48 | 51 | 54 | 50 |
| Other operating income | 230 | 421 | 331 | 322 | 272 | 395 | 468 | 399 | 277 |
| Commission income and other income | 540 | 745 | 637 | 671 | 623 | 748 | 790 | 738 | 625 |
| Dividends | 8 | 4 | 2 | 1 | 1 | 17 | 4 | 27 | 2 |
| Income from investment in related companies | 109 | 77 | 62 | 186 | 179 | 212 | 128 | 117 | 170 |
| Net return on financial investments | 31 | -36 | 172 | 32 | 68 | 42 | 158 | 53 | 32 |
| Net return on financial investments | 148 | 44 | 235 | 219 | 248 | 270 | 289 | 197 | 205 |
| Total income | 1,499 | 1,590 | 1,630 | 1,613 | 1,578 | 1,716 | 1,748 | 1,622 | 1,525 |
| Staff costs | 417 | 490 | 476 | 463 | 423 | 465 | 531 | 553 | 415 |
| Other operating expenses | 271 | 268 | 286 | 302 | 275 | 269 | 265 | 271 | 261 |
| Total operating expenses | 688 | 758 | 762 | 765 | 698 | 735 | 796 | 824 | 675 |
| Result before losses | 810 | 832 | 868 | 848 | 880 | 981 | 952 | 798 | 850 |
| Loss on loans, guarantees etc. | 22 | -48 | -0 | 32 | 31 | 39 | 59 | 242 | 231 |
| Result before tax | 788 | 880 | 868 | 816 | 849 | 942 | 893 | 556 | 619 |
| Tax charge | 172 | 178 | 169 | 112 | 175 | 191 | 131 | 105 | 102 |
| Result investment held for sale, after tax | 1 | 0 | -1 | -0 | 1 | 4 | 6 | -0 | 2 |
| Net profit | 617 | 702 | 698 | 703 | 675 | 755 | 768 | 450 | 519 |
| Group (NOKm) | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q | 4Q | 3Q |
|---|---|---|---|---|---|---|---|---|---|
| 2022 | 2022 | 2022 | 2021 | 2021 | 2021 | 2021 | 2020 | 2020 | |
| Profitability | |||||||||
| Return on equity per quarter 1) | 10.9% | 12.9% | 12.5% | 12.7% | 12.4% | 14.3% | 14.8% | 8.9% | 10.5% |
| Cost-income ratio 1) | 46 % | 48 % | 47 % | 47 % | 44 % | 43 % | 46 % | 51 % | 45 % |
| Balance sheet figures | |||||||||
| Gross loans to customers | 150,247 148,681 147,023 147,301 143,972 141,935 137,471 134,648 133,640 | ||||||||
| Gross loans incl. SB1 Boligkreditt and SB1 Næringskreditt |
208,900 205,504 199,965 195,353 191,976 189,015 185,342 182,801 179,423 | ||||||||
| Deposit from customers | 120,558 123,812 114,053 111,286 109,691 110,133 102,390 | 97,529 | 95,391 | ||||||
| Total assets | 218,918 217,458 207,027 198,845 200,124 200,426 193,822 187,912 186,900 | ||||||||
| Quarterly average total assets Growth in loans incl. SB1 Boligkreditt and SB1 |
218,188 212,243 202,936 199,492 200,275 197,124 190,867 187,406 188,692 | ||||||||
| Næringskredtt last 12 months 1) | 1.7 % | 2.8 % | 2.4 % | 1.8 % | 1.6 % | 2.0 % | 1.4 % | 1.9 % | 2.5 % |
| Growth in deposits last 12 months | -2.6 % | 8.6 % | 2.5 % | 1.5 % | -0.4 % | 7.6 % | 5.0 % | 2.2 % | 1.2 % |
| Losses in % of gross loans incl. SB1 Boligkreditt and SB1 Næringskreditt |
|||||||||
| Impairment losses ratio 1) | 0.04 % | -0.09 % | 0.00 % | 0.07 % | 0.07 % | 0.08 % | 0.13 % | 0.54 % | 0.52 % |
| Stage 3 as a percentage of gross loans 1) | 1.07 % | 1.08 % | 1.62 % | 1.68 % | 1.80 % | 1.87 % | 1.66 % | 1.23 % | 1.30 % |
| Solidity | |||||||||
| Common equity Tier 1 capital ratio | 19.2 % | 18.8 % | 18.3 % | 18.0 % | 18.1 % | 18.3 % | 18.0 % | 18.3 % | 17.6 % |
| Tier 1 capital ratio | 20.8 % | 20.4 % | 19.8 % | 19.6 % | 19.7 % | 20.0 % | 19.7 % | 20.0 % | 19.2 % |
| Capital ratio | 23.0 % | 22.7 % | 21.9 % | 21.6 % | 21.8 % | 22.2 % | 21.9 % | 22.3 % | 21.4 % |
| Tier 1 capital | 21,252 | 20,547 | 19,797 | 19,322 | 19,265 | 19,011 | 18,636 | 18,636 | 18,290 |
| Total eligible capital | 23,546 | 22,910 | 21,839 | 21,333 | 21,338 | 21,105 | 20,741 | 20,759 | 20,373 |
| Liquidity Coverage Ratio (LCR) | 180 % | 204 % | 155 % | 138 % | 163 % | 184 % | 190 % | 171 % | 140 % |
| Leverage Ratio | 7.3 % | 6.9 % | 7.0 % | 6.9 % | 6.9 % | 7.0 % | 7.0 % | 7.1 % | 7.1 % |
| Key figures ECC | |||||||||
| ECC share price at end of period (NOK) | 111,40 | 115,80 | 141,20 | 149,00 | 129,80 | 119,20 | 107,40 | 97.60 | 84.30 |
| Number of certificates issued, millions 1) | 129,29 | 129,31 | 129,39 | 129,39 | 129,39 | 129,36 | 129,22 | 129.39 | 129.44 |
| Booked equity capital per ECC (NOK) 1) | 107.19 | 102.91 | 99.55 | 103.48 | 103.57 | 100.18 | 96.70 | 94.71 | 92.73 |
| Profit per ECC, majority (NOK) 1) | 2.89 | 3.20 | 3.20 | 3.20 | 3.22 | 3.51 | 3.40 | 1.99 | 2.35 |
| Price-Earnings Ratio (annualised) 1) | 9.62 | 9.06 | 11.05 | 11.65 | 10.09 | 8.50 | 7.91 | 12.28 | 8.96 |
| Price-Book Value Ratio 1) | 1.04 | 1.13 | 1.42 | 1.44 | 1.25 | 1.19 | 1.11 | 1.03 | 0.91 |
1) Defined as alternative performance measures, see attachment to the quarterly report
1 October 2020 to 30 September 2022
OSEBX = Oslo Stock Exchange Benchmark Index (rebased) OSEEX = Oslo Stock Exchange ECC Index (rebased)
1 October 2021 to 30 September 2022
Total number of ECs traded (1000)
| 20 largest ECC holders | No. Of ECCs | Holding |
|---|---|---|
| Sparebankstiftelsen SMN | 3,965,391 | 3.05 % |
| State Street Bank and Trust Comp | 3,157,183 | 2.43 % |
| Pareto Aksje Norge VPF | 2,860,493 | 2.20 % |
| VPF Alfred Berg Gamba | 2,703,934 | 2.08 % |
| VPF Eika Egenkapitalbevis | 2,667,813 | 2.05 % |
| VPF Odin Norge | 2,574,707 | 1.98 % |
| J. P. Morgan Chase Bank, N.A., London | 2,555,343 | 1.97 % |
| Pareto Invest Norge AS | 2,321,604 | 1.79 % |
| State Street Bank and Trust Comp | 2,286,042 | 1.76 % |
| KLP | 2,230,268 | 1.72 % |
| Danske Invest Norske Aksjer Institusjon II. | 2,225,568 | 1.71 % |
| Forsvarets personellservice | 2,014,446 | 1.55 % |
| The Bank of New York Mellon SA/NV | 1,991,067 | 1.53 % |
| Spesialfondet Borea Utbytte | 1,888,933 | 1.45 % |
| J. P. Morgan SE (nominee) | 1,775,331 | 1.37 % |
| VPF Nordea Norge | 1,573,914 | 1.21 % |
| RBC Investor Services Trust | 1,462,774 | 1.13 % |
| MP Pensjon PK | 1,352,771 | 1.04 % |
| J. P. Morgan SE (nominee) | 1,293,702 | 1.00 % |
| J. P. Morgan SE (nominee) | 1,229,700 | 0.95 % |
| The 20 largest ECC holders in total | 44,130,984 | 33.99 % |
| Others | 85,705,459 | 66.01 % |
| Total issued ECCs | 129,836,443 | 100.00 % |
SpareBank 1 SMN aims to manage the Group's resources in such a way as to provide equity certificate holders with a good, stable and competitive return in the form of dividend and a rising value of the bank's equity certificate.
The net profit for the year will be distributed between the owner capital (the equity certificate holders) and the ownerless capital in accordance with their respective shares of the bank's total equity capital.
SpareBank 1 SMN's intention is that about one half of the owner capital's share of the net profit for the year should be disbursed in dividends and, similarly, that about one half of the owner capital's share of the net profit for the year should be disbursed as gifts or transferred to a foundation. This is on the assumption that capital adequacy is at a satisfactory level. When determining dividend payout, account will be taken of the profit trend expected in a normalised market situation, external framework conditions and the need for tier 1 capital.
To the Board of SpareBank 1 SMN
We have reviewed the accompanying consolidated interim balance sheet of SpareBank 1 SMN as of 30 September 2022, the statement of changes in equity and the cash flow statement for the nine-month period then ended, and a summary of significant accounting policies and other explanatory notes. Management is responsible for the preparation and fair presentation of this interim financial information in accordance with IAS 34 Interim Financial Reporting. Our responsibility is to express a conclusion on this interim financial information based on our review.
We conducted our review in accordance with International Standard on Review Engagements 2410, Review of Interim Financial Information Performed by the Independent Auditor of the Entity. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (ISAs), and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Based on our review, nothing has come to our attention that causes us to believe that the accompanying consolidated interim financial information does not present fairly, in all material respects, the financial position of the entity as at 30 September 2022, and its financial performance and its cash flows for the nine-month period then ended in accordance with IAS 34 Interim Financial Reporting.
Trondheim, 27 October 2022 PricewaterhouseCoopers AS
Rune Kenneth S. Lædre State Authorised Public Accountant
Note: This translation from Norwegian has been prepared for information purposes only.
PricewaterhouseCoopers AS, Brattørkaia 17B, Postboks 6365 Torgard, NO-7492 Trondheim T: 02316, org. no.: 987 009 713 MVA, www.pwc.no Statsautoriserte revisorer, medlemmer av Den norske Revisorforening og autorisert regnskapsførerselskap
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