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SpareBank 1 SMN
Quarterly Report • May 8, 2024
3751_rns_2024-05-08_d31a6158-2d79-4fcf-9579-e43c87290da9.pdf
Quarterly Report
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First Quarter Report 2024
| Main figures 3 | |
|---|---|
| Report of the Board of Directors 5 | |
| Income statement 18 | |
| Balance sheet 20 | |
| Cash flow statement 21 | |
| Change in equity 22 | |
| Notes 25 | |
| Results from quarterly accounts 56 | |
| Key figures from quarterly accounts 57 | |
| Equity capital certificates 58 | |
| Auditor's report 60 |
Main figures
| January - March | |||
|---|---|---|---|
| From the income statement (NOKm) | 2024 | 2023 | 2023 |
| Net interest | 1,306 | 1,035 | 4,632 |
| Net commission income and other income | 572 | 541 | 2,084 |
| Net return on financial investments | 281 | 28 | 799 |
| Total income | 2,159 | 1,604 | 7,515 |
| Total operating expenses | 782 | 728 | 3,017 |
| Results before losses | 1,377 | 875 | 4,498 |
| Loss on loans, guarantees etc | 24 | -71 | 14 |
| Results before tax | 1,353 | 946 | 4,484 |
| Tax charge | 273 | 206 | 904 |
| Result investment held for sale, after tax | 3 | 38 | 108 |
| Net profit | 1,084 | 778 | 3,688 |
| Interest Tier 1 Capital | 48 | 34 | 125 |
| Net profit excl. Interest Tier 1 Capital | 1,035 | 744 | 3,563 |
| Balance sheet figures | 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 |
| Gross loans to customers | 169,326 | 153,181 | 169,862 |
| Gross loans to customers incl. SB1 Boligkreditt and SB1 Næringskreditt | 238,270 | 213,967 | 236,329 |
| Deposits from customers | 134,395 | 123,529 | 132,888 |
| Average total assets | 234,219 | 225,759 | 235,303 |
| Total assets | 235,721 | 228,207 | 232,717 |
| Key figures | January - March | ||
| 2024 | 2023 | 2023 | |
| Profitability 1) | |||
| Return on equity | 16.0 % | 13.0 % | 14.4 % |
| Cost-income ratio 2) | 42 % | 46 % | 45 % |
| Deposit-to-loan ratio excl. SB1 Boligkreditt and SB1 Næringskreditt | 79 % | 81 % | 78 % |
| Deposit-to-loan ratio incl. SB1 Boligkreditt and SB1 Næringskreditt | 56 % | 58 % | 56 % |
| Growth in loans (gross) last 12 months (incl. SB1 Boligkreditt and SB1 Næringskreditt) | 11.4 % | 7.0 % | 11.9 % |
| Growth in deposits last 12 months | 8.8 % | 8.3 % | 8.9 % |
| Losses in % of gross loans incl. SB1 Boligkreditt and SB1 Næringskreditt 1) | |||
| Impairment losses ratio | 0.04 % | -0.13 % | 0.01 % |
| Stage 3 as a percentage of gross loans | 0.82 % | 0.96 % | 0.88 % |
| Solidity | 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 |
| Capital ratio | 23.1 % | 22.2 % | 23.0 % |
| Tier 1 capital ratio | 20.4 % | 20.1 % | 20.8 % |
| Common equity Tier 1 capital ratio | 18.5 % | 18.2 % | 18.8 % |
| Tier 1 capital | 24,073 | 21,985 | 23,793 |
| Total eligible capital | 27,250 | 24,298 | 26,399 |
| Liquidity Coverage Ratio (LCR) | 160 % | 194 % | 175 % |
| Leverage Ratio | 7.1 % | 6.9 % | 7.2 % |
| MREL | 53.7 % | 64.6 % | 67.8 % |
| MREL, substituted | 36.7 % | 31.0 % | 35.9 % |
| NSFR | 130.0 % | 126.0 % | 127.0 % |
| Branches and staff | 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 |
| Number of branches | 47 | 40 | 46 |
| No. Of full-time positions | 1,637 | 1,432 | 1,545 |
1) Defined as alternative performance measures, see attachment to quarterly report
1st Quarter 2024
| Key figures ECC | 31 Mar 24 | 31 Mar 23 | 31 Dec 23 | 31 Dec 22 | 31 Dec 21 | 31 Dec 20 |
|---|---|---|---|---|---|---|
| ECC ratio | 67 % | 64 % | 67 % | 64 % | 64 % | 64 % |
| Number of certificates issued, millions 1) | 144.13 | 129.43 | 144.20 | 129.29 | 129.39 | 129.39 |
| ECC share price at end of period (NOK) | 137.80 | 123.60 | 141.80 | 127.40 | 149.00 | 97.60 |
| Stock value (NOKM) | 19,861 | 15,997 | 20,448 | 16,471 | 19,279 | 12,629 |
| Booked equity capital per ECC (including dividend) 1) | 113.24 | 105.63 | 120.48 | 109.86 | 103.48 | 94.71 |
| Profit per ECC, majority 1) | 4.68 | 3.51 | 16.88 | 12.82 | 13.31 | 8.87 |
| Dividend per ECC | 12.00 | 6.50 | 7.50 | 4.40 | ||
| Price-Earnings Ratio 1) | 7.36 | 8.79 | 8.40 | 9.94 | 11.19 | 11.01 |
| Price-Book Value Ratio 1) | 1.22 | 1.17 | 1.18 | 1.16 | 1.44 | 1.03 |
1) Defined as alternative performance measures, see attachment to quarterly report
Report of the Board of Directors
First quarter 2024
(Consolidated figures. Figures for the former SpareBank 1 Søre Sunnmøre are included as from the second quarter of 2023. Figures in parenthesis refer to the same period of 2023 unless otherwise stated. Growth figures adjusted for the merger are referred to under 'loans' and 'deposits')
- Pre-tax profit NOK 1,353m (946m)
- Net profit NOK 1,084m (778m)
- Return on equity 16.0% (13.0%)
- CET1 ratio 18.5% (18.2%)
- Growth in lending 0.8% (1.3%) and in deposits 1.1% (1.2%)
- Lending to the bank's retail customers rose 0.6% in the quarter (0.6%), 0.2 percentage points lower growth than in the fourth quarter. Lending to the bank's corporate clients rose 1.5% (2.7%) which was 0.5 percentage points higher growth than in the fourth quarter
- Deposits from retail customers rose 1.6% (1.9%), 0.5 percentage points higher growth than in the fourth quarter. Deposits from corporate clients climbed 2.5% (1.2%). This is 12.5 percentage points higher growth than in the fourth quarter, which was impacted by a reduction in public sector deposits
- The net result of ownership interests was NOK 194m (125m)
- The net result of financial instruments (incl. dividends) was NOK 87m (minus 97m)
- Losses on loans and guarantees: NOK 24m (minus 71m)
- Earnings per equity certificate (EC): NOK 4.68 (3.51)
- Book value per EC was NOK 113.24 (105.63) and the price of the bank's EC (MING) was NOK 137.80 (123.60)
Events in the quarter
Merger of the insurance arms of Fremtind and Eika approved by the Competition Authority
In January 2024, the transaction agreement to amalgamate the insurance businesses of Fremtind and Eika was signed. The agreement is contingent on approval from the Competition Authority and Finanstilsynet (Norway's Financial Supervisory Authority). The Competition Authority's approval for the merger of Fremtind Forsikring and Eika Forsikring was granted on 1 March 2024. Finanstilsynet's approval is expected in the second quarter of 2024.
SpareBank 1 SMN owns 19.5 per cent of the shares of the SpareBank 1 Group, which upon completion of the transaction will own 51.44 per cent of the shares of Fremtind Holding.
Insurance settlement in the embezzlement affair
In the first quarter SpareBank 1 SMN reached a settlement in the embezzlement affair whereby the insurance company disbursed NOK 30 million to the bank. The embezzlement was first reported on in the first quarter of 2023.
Unchanged base rate and inflation above target
Norges Bank kept the base rate unchanged at 4.50 per cent in March and reiterated its signal that the base rate would stay at its present level for much of 2024.
The 12-month rate of growth in the consumer price index (CPI) was 3.9 per cent at the end of the first quarter of 2024. Underlying inflation in the same period in terms of the consumer price index adjusted for changes in indirect taxes and excluding energy products (CPI-ATE) was 4.5 per cent. The wholly unemployed share of the labour force remains at a very low level, but is expected to rise somewhat through 2024. In Trøndelag and in Møre and Romsdal the wholly unemployed share is 1.5 and 1.7 per cent respectively. For Norway as a whole the share is 2.0 per cent.
Growth in credit to households and non-financial undertakings fell further in the first quarter of 2024. As at March the national twelve-month rate of growth in credit to households and non-financial undertakings was 3.0 and 2.7 per cent respectively.
The regional indicator in Norges Bank's regional network survey for Mid Norway showed a small improvement in the first quarter of 2024, but remains on a slightly negative trend.
Såkorn 1 Midt
The board of SpareBank 1 SMN decided in spring 2023 to allocate up to NOK 150 million from the bank's community dividend for sustainable early-stage investments in Mid-Norway. The funds will be allocated to the foundation Såkorn 1 Midt, which will carry out the fund's investments. The bank's contribution was expected to constitute a maximum of 50 percent of committed capital. An additional NOK 100 million in capital has now been raised in addition to the contribution from SpareBank 1 SMN, which means that a total of NOK 200 million has been raised in the first subscription round. There is a goal to raise further capital through a new subscription round towards the end of 2024.
Results for the first quarter
The first quarter of 2024 is marked by good results across the entire group. High net interest income at the bank, good commission income from the subsidiaries and strong profit contributions from ownership interests make for an overall net profit of NOK 1,084m and a return of 16.0 per cent on equity.
The bank made a general interest rate change in the first quarter, with some effect noted in the quarter. After a long period of interest rate hikes by the central bank, all announced rate hikes have now been carried out. Dampened credit growth and growing competition in the retail market impacted lending growth in the quarter, but implemented interest rate changes and stable market rates bring increased net interest income adjusted for the one-time event in the previous quarter.
Seasonal variations and higher market shares at SpareBank 1 Regnskapshuset SMN and EiendomsMegler 1 Midt-Norge provide increased commission income. In the first quarter the bank increased the share of residential mortgages transferred to the captive residential mortgage company, SpareBank 1 Boligkreditt. This, together with stable market interest rates and higher lending rates, brought increased commission income from the mortgage company.
The result from related companies shows a substantial increase compared with the previous quarter. The insurance companies in the SpareBank 1 Group performed well in the first quarter, and BN Bank continues to deliver creditable results. A value increase in SpareBank 1 SMN Invest's portfolio and capital gain on financial instruments also provide positive profit contributions in the quarter.
The group's operating expenses are reduced compared with the fourth quarter. Reduced IT expenses, recovery of operational losses and one-time events in the fourth quarter explain the bulk of the decline in expenses.
Loan losses in the first quarter are at a low level. The loss picture is again marked by recoveries in the offshore segment and higher loss provisioning in other sectors.
The CET1 ratio is 18.5 per cent at quarter-end, which is well above the group's own target and regulatory requirements.
Net interest income
Market interest rates in terms of NIBOR were stable through the first quarter, with three-month NIBOR averaging 4.71 per cent in the quarter. The bank carried out a general interest rate increase for retail customers with effect from 9 March 2024.
Net interest income totalled NOK 1,306m (1,035m) compared with NOK 1,312m in the fourth quarter. When adjusted for a one-time effect of NOK 59m in the fourth quarter of 2023, this corresponds to an increase of 4.2 per cent from the previous quarter. Implemented interest rate changes and stable market rates have brought wider lending margins and narrower deposit margins, thus contributing to higher net interest income.
Volume transferred to SpareBank 1 Boligkreditt was increased by NOK 2.5bn in the first quarter of 2024. Net interest income including commissions from the captive mortgage companies was NOK 33m higher than in the fourth quarter. Adjusted for the one-time effect in the previous quarter, the increase measures NOK 92m, corresponding to 7.3 per cent.
Commission income and other operating income
SpareBank 1 SMN's strategy of exploiting the breadth present in the group and expanding interaction across the respective business lines stands firm. A high proportion of multi-product customers contributes to a capital-efficient, diversified income flow and high customer satisfaction.
| Commission income (NOKm) | 1Q 24 | 4Q 23 | 1Q 23 |
|---|---|---|---|
| Payment transfers | 77 | 101 | 72 |
| Creditcard | 18 | 14 | 17 |
| Saving products | 11 | 11 | 10 |
| Insurance | 63 | 61 | 61 |
| Guarantee commission | 15 | 16 | 16 |
| Real estate agency | 115 | 98 | 105 |
| Accountancy services | 200 | 152 | 188 |
| Other commissions | 11 | 23 | 11 |
| Commissions ex SB1 Boligkreditt and SB1 Næringskreditt | 510 | 475 | 480 |
| Commissions SB1 Boligkreditt | 59 | 19 | 57 |
| Commissions SB1 Næringskreditt | 4 | 4 | 3 |
| Total commissions | 572 | 498 | 541 |
Compared with fourth quarter, commissions from payments services are reduced while income from accounting services and estate agency services shows a substantial increase. This is primarily due to
seasonal variations. Commission income excluding mortgage companies rose by NOK 35m from the previous quarter and by NOK 30m from the same quarter of 2023.
Measured against the same quarter of last year, commission income excluding mortgage companies rose 6 per cent. The fine development is driven in particular by income from estate agency and accounting services. EiendomsMegler 1 Midt-Norge has increased its market share from 37.7 per cent in the first quarter 2023 to 38.7 per cent in the first quarter 2024. SpareBank 1 Regnskapshuset SMN has strengthened its advisory capacity and its focus on digitalisation to good effect. This has brought increased organic growth and reinforced customer loyalty. At the same time acquisitions are contributing higher commission income.
In the case of loans sold to SpareBank 1 Boligkreditt and SpareBank 1 Næringskreditt, the bank receives a commission corresponding to the loan interest less the funding and operating expenses of those companies. The increased commission income from SpareBank 1 Boligkreditt in the first quarter is mainly down to higher lending rates.
Return on financial investments
Return on financial investments in the first quarter was NOK 84m (minus 99m). Capital gains of NOK 42m are driven by an increase in the value of SpareBank 1 SMN Invest's share portfolio.
Financial instruments, including bonds and CDs, showed a capital gain of NOK 20m (capital loss of 105m) while income from foreign exchange transactions declined by NOK 5m from the preceding quarter to NOK 22m (NOK 23m). The fourth quarter of 2023 included a gain of NOK 414m related to disinvestment from SpareBank 1 Markets. The first quarter of 2023 was marked by wider credit margins and interest rate turbulence which brought losses on financial instruments.
| Return on financial investments (NOKm) | 1Q 24 | 4Q 23 | 1Q 23 |
|---|---|---|---|
| Capital gains/losses shares | 42 | 472 | -17 |
| Gain/(loss) on financial instruments | 20 | -8 | -105 |
| Foreign exchange gain/(loss) | 22 | 27 | 23 |
| Net return on financial instruments | 84 | 491 | -99 |
Related companies
SpareBank 1 SMN has a broad and well-diversified income platform. The group offers its customers a broad product range through various product companies, both directly owned companies and companies in the SpareBank 1 Group, which provide commission income along with return on invested capital.
The overall profit share from the product companies and other related companies was NOK 194m (125m) in the quarter. In the fourth quarter of 2023 the corresponding figure was NOK 90m.
| Income from investment in associated companies (NOKm) | 1Q 24 | 4Q 23 | 1Q 23 |
|---|---|---|---|
| SpareBank 1 Gruppen (19.5 %) | 40 | -51 | 34 |
| SpareBank 1 Boligkreditt (23.7 %) | 33 | 30 | 33 |
| SpareBank 1 Næringskreditt (14.8 %) | 4 | 1 | 2 |
| BN Bank (35.0 %) | 84 | 73 | 62 |
| SpareBank 1 Markets (39.9 %) | 25 | 19 | 0 |
| SpareBank 1 Kreditt (18.6 %) | -4 | -3 | -4 |
| SpareBank 1 Betaling (21.9 %) | -12 | -8 | -8 |
| SpareBank 1 Forvaltning (21.5 %) | 10 | 12 | 8 |
| Other companies | 13 | 16 | -3 |
| Income from investment in associated companies | 194 | 90 | 125 |
SpareBank 1 Alliance
The SpareBank 1 Alliance is a collaboration between the SpareBank 1 banks. The collaboration is designed to provide economies of scale and to ensure the owner banks access to competitive financial services and products. The Alliance collaboration is driven through its ownership of the SpareBank 1 Group which owns and manages several of the product companies, and its participation in SpareBank 1 Utvikling which develops and delivers joint products and services.
SpareBank 1 Gruppen
SpareBank 1 Gruppen posted a net profit of NOK 271m (272m) in the first quarter, of which SpareBank 1 SMN's share of the controlling interest's net profit was NOK 40m (34m).
The most important companies in SpareBank 1 Gruppen (SpareBank 1 Gruppen's holding):
- Fremtind Forsikring (65 per cent) offers non-life and personal insurance coverage and is headquartered in Oslo. The company posted a profit of NOK 206m (274m) after tax in the first quarter.
- SpareBank 1 Forsikring (100 per cent) is a pension company headquartered in Oslo. The company mainly offers contribution-based occupational pensions, collective disability insurance and private pension saving. SpareBank 1 Forsikring reported a profit of NOK 112m (44m) after tax in the first quarter.
- SpareBank 1 Factoring (100 per cent) offers financial and administrative factoring services. The company is headquartered in Ålesund. The company posted a profit of NOK 19m (18m) after tax in the first quarter.
- Related companies in SpareBank 1 Gruppen posted a contribution of NOK 7m (0m) to SpareBank 1 Gruppen's profit. Kredinor (50 per cent) is Norway's largest debt collection company, and is a related company in SpareBank 1 Gruppen. As from 25 April 2024, SpareBank 1 Gruppen has the controlling interest in Kredinor with a holding of 68.64 per cent.
SpareBank 1 Forvaltning delivers products and services to a broad range of clients in the field of capital management and securities services. SpareBank 1 SMN's profit share in the quarter was NOK 10m (8m).
SpareBank 1 Boligkreditt is a mortgage company that issues covered bonds secured by residential mortgages with a view to achieving stable financing and low financing costs. SpareBank 1 SMN's profit share was NOK 33m (33m) in the first quarter.
SpareBank 1 Næringskreditt is a mortgage company that issues covered bonds secured by commercial mortgages with a view to achieving stable financing and low financing costs. SpareBank 1 SMN's profit share was NOK 4m (2m) in the quarter.
SpareBank 1 Kreditt offers unsecured finance to retail customers. SpareBank 1 SMN's profit share in the fourth quarter was minus NOK 4m (minus 4m).
BN Bank offers residential mortgages and loans to commercial property and its main market is southeastern Norway. SpareBank 1 SMN's share of BN Bank's profit was NOK 84m (62m) in the quarter.
SpareBank 1 Markets is a leading Norwegian investment firm. The company offers services in the fields of equity and credit analysis, equity and bond trading and services in the corporate finance area. SpareBank 1 SMN's share of SpareBank 1 Markets' profit in the first quarter was NOK 25m.
SpareBank 1 Betaling is the SpareBank 1 banks' parent company in Vipps AS. SpareBank 1 SMN's profit share was minus NOK 12m (minus 8m) in the first quarter.
Other companies
The net profit of NOK 13m in the quarter was driven in all essentials by the profit share from Grilstad Marina.
Operating expenses
The group aims for a cost-income ratio below 40 per cent at the bank and below 85 per cent at EiendomsMegler 1 Midt-Norge and SpareBank 1 Regnskapshuset SMN. The cost-income ratio is defined as the ratio of operating expenses to net interest income and commission and other income.
The bank's cost-income ratio was 33.9 per cent in the quarter (40.0 per cent). The corresponding figures for EiendomsMegler 1 and Regnskapshuset were 83.0 (83.2) and 83.9 (78.1) per cent respectively.
| NOKm | 1Q 24 | 4Q 23 | 1Q 23 |
|---|---|---|---|
| Staff costs | 482 | 476 | 398 |
| IT costs | 104 | 132 | 106 |
| Marketing | 26 | 21 | 23 |
| Ordinary depreciation | 41 | 47 | 29 |
| Operating expenses, real properties | 13 | 11 | 16 |
| Purchased services | 74 | 71 | 31 |
| Merger expenses | 6 | 18 | 22 |
| Other operating expense | 36 | 90 | 104 |
| Total operating expenses | 782 | 866 | 728 |
Compared with the fourth quarter of 2023, expenses are reduced by NOK 84m. The reduction is mainly due to the expensing of capital tax in the fourth quarter and recovery of operational losses along with lower IT expenses in the first quarter of 2024.
Overall group expenses rose by NOK 54m from the first quarter of 2023, of which NOK 33m of the increase refers to the subsidiaries. Price and wage growth along with acquisitions made by SpareBank 1 Regnskapshuset SMN are the chief driver behind the subsidiaries' expense growth.
The bank's expenses have risen by NOK 21m compared with the first quarter of 2023. The first quarter of 2023 featured expensing of the embezzlement affair and merger costs of NOK 15m. Expenses in the first quarter of 2024 are reduced as a result of the insurance settlement in connection with the embezzlement, while the quarter also contains the former SpareBank 1 Søre Sunnmøre's cost base.
Investments in technology development, competence and growth initiatives in selected geographical locations through 2023 are reflected in the bank's growth in costs.
Losses on loans and guarantees
The group's losses on loans and guarantees in the fourth quarter of 2023 came to NOK 24m (recovery of a loss of NOK 71m) in the first quarter of 2024.
| Impairment losses (NOKm) | 1Q 24 | 4Q 23 | 1Q 23 |
|---|---|---|---|
| RM | 8 | -8 | 11 |
| CM | 16 | 28 | -82 |
| Total impairment losses | 24 | 20 | -71 |
Losses in the quarter break down to minus NOK 13m in Stage 1 and 2 and NOK 37m in Stage 3. Losses in the period measured 0.04 per cent of total outstanding loans (minus 0.13 per cent).
Overall impairment write-downs on loans and guarantees as at 31 March amount to NOK 1,011m (1,101m).
The group's loan portfolio is of good credit quality. The portfolio comprises NOK 167,362m (151.116m) in Stages 1 and 2 respectively, corresponding to 99.18 per cent. Problem loans (Stage 3) total NOK 1,964m (2,065m), corresponding to 0.82 per cent (0.96 per cent) of gross outstanding loans, including loans sold to the captive mortgage companies.
Recoveries are noted in the quarter in the offshore segment due continued improvement in that segment. However, increased loss provisioning is seen in other industries, related in particular to fishery.
Business lines
In SpareBank 1 SMN the business lines are Retail Banking and Corporate Banking along with significant subsidiaries.
SpareBank 1 SMN's strategy of exploiting the breadth present in the group and expanding interaction across the respective business lines stands firm.
The Retail Banking Division achieved a pre-tax profit of NOK 499m in the first quarter of 2024 (372m). Return on capital employed was 17.7 per cent (16.3 per cent). The retail banking portfolio consists of wage earners, agricultural customers and sole proprietorships.
| Profit and loss account (NOKm) | 1Q 24 | 4Q 23 | 1Q 23 |
|---|---|---|---|
| Net interest | 628 | 626 | 524 |
| Comission income and other income | 187 | 167 | 181 |
| Total income | 814 | 794 | 706 |
| Total operating expenses | 304 | 373 | 325 |
| Ordinary operating profit | 510 | 421 | 381 |
| Loss on loans, guarantees etc. | 11 | -2 | 9 |
| Result before tax including held for sale | 499 | 423 | 372 |
| Balance | |||
| Loans and advances to customers | 167,736 | 166,713 | 148,294 |
| Adv.of this sold to SB1 Boligkreditt and SB1 Næringskreditt | -67,418 | -64,892 | -59,306 |
| Deposits to customers | 65,640 | 64,601 | 55,948 |
| Key figures | |||
| Return on equity per quarter *) | 22.4 % | 16.3 % | 15.8 % |
| Lending margin | 0.91 % | 0.68 % | 0.93 % |
| Deposit margin | 1.88 % | 2.14 % | 1.82 % |
*) Regulatory capital with reference to the capital target underlies the calculation of capital employed in Retail Banking and Corporate Banking.
Lending growth in the quarter was 0.6 per cent and deposit growth 1.6 per cent. The corresponding figures for the first quarter of 2023 were 0.6 and 1.9 per cent respectively.
A general interest rate increase on loans and deposits was implemented in the course of the first quarter. Income from the payments area is reduced compared with the fourth quarter owing to seasonal variations. A higher transfer share and increased margins on loans sold to SpareBank 1 Boligkreditt provide higher net commission and other income measured against the previous quarter and the same period last year.
The loan portfolio is largely secured by residential property. Lending to personal customers consistently carries low risk, as reflected in continued low losses.
The Retail Banking Division prioritises balanced growth. A focus on deposits and savings in advisory services to customers enables the bank to deliver robust earnings and heightens customers' financial security in the form of increased buffer capital. The net subscription in SpareBank 1 Forvaltning has increased significantly compared to last year.
The distribution model is enhanced by the introduction of co-location in finance centres and a transition from personal advisers to customer teams. Increased use of data and insights enables a closer interplay between the physical and digital advisory channels, providing customers with improved and more efficient advice.
Eiendomsmegler 1 Midt-Norge is the market leader in Trøndelag and in Møre and Romsdal. The pre-tax profit was NOK 20m (18m) in the first quarter.
| EiendomsMegler 1 Midt-Norge (92.4%) | 1Q 24 | 4Q 23 | 1Q 23 |
|---|---|---|---|
| Total income | 117 | 98 | 107 |
| Total operating expenses | 97 | 106 | 89 |
| Result before tax (NOKm) | 20 | -7 | 18 |
| Operating margin | 17 % | -7 % | 17 % |
Higher mortgage rates dampened activity in the housing market through autumn 2023. Fewer properties remain unsold at the start of 2024, and prospects that the base rate peak has been reached and low building activity could lead to increased sales volume and higher prices. EiendomsMegler 1 Midt-Norge continues to gain market shares, at the same time as income per sale shows a positive development.
1,648 properties were sold in the first quarter (1,587), and new assignments totalled 2,090 (2,046). The company's market share at 31 March was 38.7 per cent, up from 37.7 per cent in the same period of last year.
The Corporate Banking Division achieved a pre-tax profit of NOK 483m (NOK 500m). Return on capital employed was 26.3 per cent.
| CM, Profit and loss account (NOKm) | 1Q 24 | 4Q 23 | 1Q 23 |
|---|---|---|---|
| Net interest | 570 | 659 | 474 |
| Comission income and other income | 72 | 90 | 63 |
| Total income | 642 | 749 | 541 |
| Total operating expenses | 148 | 168 | 127 |
| Ordinary operating profit | 494 | 581 | 413 |
| Loss on loans, guarantees etc. | 10 | -25 | -86 |
| Result before tax including held for sale | 484 | 606 | 500 |
| Balance | |||
| Loans and advances to customers | 58,071 | 57,191 | 53,245 |
| Adv.of this sold to SB1 Boligkreditt and SB1 Næringskreditt | -1,526 | -1,576 | -1,481 |
| Deposits to customers | 64,532 | 62,988 | 63,644 |
| Key figures | |||
| Return on equity per quarter *) | 34.9 % | 33.1 % | 28.6 % |
| Lending margin | 2.69 % | 2.90 % | 2.64 % |
| Deposit margin | 0.47 % | 0.63 % | 0.27 % |
*) Regulatory capital with reference to the capital target underlies the calculation of capital employed in Retail Banking and Corporate Banking.
The Corporate Banking Division's loan volume increased by 1.5 per cent in the quarter (2.7 per cent) while the deposit volume rose by 2.5 per cent (1.2 per cent).
For customers with loan and deposit products not tied to interbank rates, a general interest rate increase was implemented in the first quarter. When adjusted for the one-time effect in the fourth quarter of 2023, the lending margin widened compared with the previous quarter.
The credit quality of the loan portfolio is good. The bankruptcy rate in the region has risen, but so far with limited impact on the loan portfolio.
A strengthened input of resources in Trondheim and increased coordination with SpareBank 1 Regnskapshuset contribute to Corporate Banking's acquisition of market shares in Mid Norway. The establishment of a presence in Oslo is expected to stimulate lending growth in selected segments where SpareBank 1 SMN offers competencies and experience.
SpareBank 1 Regnskapshuset SMN is the market leader in Trøndelag and in Møre and Romsdal. The company posted a pre-tax profit of NOK 35m (44m).
| SpareBank 1 Regnskapshuset SMN (93.3%) | 1Q 24 | 4Q 23 | 1Q 23 |
|---|---|---|---|
| Total income | 217 | 167 | 202 |
| Total operating expenses | 182 | 159 | 158 |
| Result before tax (NOKm) | 35 | 8 | 44 |
| Operating margin | 16 % | 5 % | 22 % |
Operating income climbed NOK 15m from the first quarter of 2023, driven by increased incomes from advisory and accounting services. There were three fewer working days in the first quarter of 2024 than in the same quarter of last year. The cost increase is in all essentials driven by higher personnel costs due to staff additions, wage growth and acquisitions.
Substantial sums have been invested in developing the company's competitive power. This is producing results ranging from strengthened advisory competencies and capacity to a greater focus on digitalisation and new income flows. Cloud-based solutions that simplify matters for the company, along with enhanced insights and improvements in the customer process, are at centre stage. This has spurred organic customer growth and reinforced the loyalty of existing customers.
SpareBank 1 Finans Midt-Norge's focal areas are leasing, vendor's liens, inventory financing and invoice purchasing services to businesses and vendor's liens to personal customers. SpareBank 1 Finans Midt-Norge recorded a pre-tax profit of NOK 66m (53m).
| SpareBank 1 Finans Midt-Norge (56.5%) | 1Q 24 | 4Q 23 | 1Q 23 |
|---|---|---|---|
| Total income | 108 | 85 | 90 |
| Total operating expenses | 39 | 26 | 30 |
| Loss on loans, guarantees etc. | 3 | 47 | 7 |
| Result before tax (NOKm) | 66 | 12 | 53 |
The company has in recent years developed new distribution channels with a special focus on the car dealer channel. More than 25 per cent of vendor's liens to personal customers came directly from car dealers in the first quarter of 2024. SpareBank 1 Finans Midt-Norge has a market share of about 10 per cent in vendor's liens in the counties where parent banks are represented.
SpareBank 1 SMN Invest owns shares and units in regional growth companies and funds. The portfolio is managed together with other long-term shareholdings of the bank and will be scaled down over time. The company's securities portfolio is worth NOK 561m (487m) as at 31 March 2024.
The company's pre-tax profit in the first quarter of 2024 was NOK 33m (minus 30m). The quarter's result is ascribable to an increase in the value of the securities portfolio.
Balance sheet, financing and liquidity
Total assets of NOK 236bn
The bank's total assets as at the first quarter of 2024 were NOK 236bn (228bn), having risen by NOK 8bn, or 3.3 per cent, over the last 12 months. Total assets have grown as a result of the merger with the former SpareBank 1 Søre Sunnmøre along with lending growth.
As at 31 March 2024 loans totalling NOK 69bn (61bn) had been sold from SpareBank 1 SMN to the captive mortgage companies SpareBank 1 Boligkreditt and 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 the two mortgage companies.
Loans
Total outstanding loans rose in the last 12 months by NOK 24.3bn (14.0bn), corresponding to 11.4 per cent (7.0 per cent), and stood at NOK 238.3bn (214.0bn) at the end of the first quarter. Lending growth in the quarter was 0.8 per cent (1.3 per cent).
Lending to the bank's retail customers increased by NOK 1.0bn in the quarter (0.9bn). This corresponds to a lending growth of 0.6 per cent (0.6 per cent). Lending growth in the last 12 months was 13.1 per cent (6.1 per cent), of which the merger with the former SpareBank 1 Søre Sunnmøre accounts for 9.0 percentage point. Total lending to the bank's retail customers came to NOK 167.7bn (148.3bn) at the end of the first quarter of 2024.
Lending to the bank's corporate segment rose by NOK 0.9bn in the quarter (1.4bn), corresponding to 1.5 per cent (2.7 per cent). Growth in lending in the last 12 months was 9.1 per cent (7.0 per cent), of which the merger accounts for 6.4 percentage points. Overall lending to the bank's corporate customers came to NOK 58.1bn (53.2bn) as at 31 March 2024.
SpareBank 1 Finans' gross loan volume was NOK 12.8bn (12.6bn) at the end of the first quarter 2024. This corresponds to a growth of 2.3 per cent in the last 12 months.
(Distributed by sector – see note 5).
Deposits
Customer deposits rose in the last 12 months by NOK 10.9bn (9,5bn) to NOK 134.4bn (123.5bn), corresponding to a growth of 8.8 per cent (8.3 per cent). Growth in the first quarter was 1.1 per cent (1.2 per cent).
Personal deposits rose NOK 1.0bn in the quarter (1.0bn), corresponding to deposit growth of 1.6 per cent (1.9 per cent). Deposit growth in the last 12 months was 17.3 per cent (6.9 per cent), of which the merger accounts for 12.7 percentage points. Total deposits from personal customers came to NOK 65.6bn (55.9bn) at the end of the first quarter.
Deposits from the bank's corporate segment climbed NOK 1.5bn in the quarter (increase of 0.7bn), corresponding to 2.5 per cent (1.2 per cent). Deposit growth in the last 12 months was 1.4 per cent (6.9 per cent). When adjusted for the merger with SpareBank 1 Søre Sunnmøre, growth in deposits from the bank's corporate segment would have been minus 5.5 per cent. The decline is attributable to growing competition for public sector deposits towards the end of 2023. Total deposits from the bank's corporate segment were NOK 64.5bn (63.6bn) as at 31 March 2024.
(Distributed by sector – see note 9).
Funding and liquidity
SpareBank 1 SMN has ample liquidity and access to funding. The bank follows 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 was calculated at 160 per cent as at 31 March 2024 (194 per cent). The Net Stable Funding Ratio (NSFR) at the end of the first quarter of 2024 was 130 per cent (126 per cent).
The group's deposit-to-loan ratio at 31 March 2024, including SpareBank 1 Boligkreditt and SpareBank 1 Næringskreditt, was 56 per cent (57 per cent).
The bank's funding sources and products are amply diversified. The share of the bank's overall money market funding with a maturity above one year was 96 per cent (76 per cent) at 31 March 2024.
SpareBank 1 Boligkreditt and Næringskreditt are important funding sources for the bank, and loans totalling NOK 69bn (61bn) had been sold to these captive mortgage companies as at 31 March 2024.
Senior non-preferred (SNP) debt denominated in Japanese yen worth the equivalent of NOK 0.4 bn was issued in the first quarter. At the end of the quarter SpareBank 1 SMN held NOK 12.7bn in SNP debt instruments. MREL debt measured 36.7 per cent as at 31 March 2024, and SpareBank 1 SMN meets the MREL requirements by an ample margin.
The bank has a rating of Aa3 (stable outlook) with Moody's.
Financial soundness
The CET1 ratio at 31 March 2024 was 18.5 per cent (18.2 per cent) compared with 18.8 per cent as at 31 December 2023.
SpareBank 1 SMN received a new Pillar 2 requirement in the fourth quarter. The requirement was reduced to 1.7 percentage point and must be met with a minimum of 56.25 per cent CET1 capital. In view of this change the group's long-term CET1 target is revised to 16.3 per cent, including Pillar 2 guidance. The bank
is subject to a provisional add-on of 0.7 per cent to its Pillar 2 requirement until its application for adjustment of IRB models has been processed. The provisional add-on of 0.7 per cent is not included in the bank's longterm capital target.
A leverage ratio of 7.1 per cent (6.9 per cent) shows the bank to be very solid. See note 4 for details.
The bank's equity certificate (MING)
The book value per equity certificate (EC) at 31 March 2024 was NOK 113.24 (105.63) and earnings per equity certificate in the first quarter of 2024 were NOK 4.68 (3.51).
The Price / Income ratio was 7.36 (8.79) and the Price / Book ratio was 1.22 (1.17).
At the end of the first quarter of 2024, owners of the bank's equity certificates total 17,845, of whom 38.3 per cent are domiciled in Mid Norway. 22.6 per cent of the bank's equity certificates are held by foreign investors.
Sustainability
SpareBank 1 SMN has over the course of the quarter engaged in a broad-based stakeholder dialogue with a view to updating the group's dual materiality analysis. Key sustainability factors have been mapped and priorities assigned in line with the requirements of the Corporate Sustainability Reporting Directive (CSRD).
Corporate Banking has focused on the transition plan for shipping to be published in the second quarter. Retail Banking has established a collaboration with other regional banks in the Alliance to develop net-zero transition plans for households. Adviser tools are being developed to strengthen advisory power in this process. Regnskapshus has in the course of the quarter piloted a new service, Klimasjekken, which is a tool for companies and local authorities to identify climate challenges in their work with sustainable development.
The effort to develop science-based climate targets, both for the group's and the bank's own operations and financed emissions, is following the planned path. As part of this process, SMN will draw up the group's climate transition plan as a superstructure for all work involved in achieving our climate goals. Part of the solution concerns circular transition. A circular economy framework has accordingly been established, and SMN is currently piloting bounded projects within its own operations in order to learn and to create awareness among its own employees.
The group's focus is on contributing to sustainable development though credible targets and action plans while at the same time realising growth, competitive margins and necessary cost reductions.
Outlook
SpareBank 1 SMN delivered a good performance in the first quarter featuring strong profitability and financial soundness. Operating profit was satisfactory, at the same time as the result from ownership interests increased return on equity. Uncertainty still attends the economy in terms of reduced household purchasing power and slowing credit growth. SpareBank 1 SMN's ambition to expand market shares stands firm, and will be realised through initiatives taken in selected geographical locations and industries.
Norges Bank kept the base rate unchanged at 4.50 per cent in March and concurrently signalled an initial base rate reduction towards the end of 2024. In view of international developments featuring continued high price growth, along with a weakened krone exchange rate, market expectations of a base rate reduction have now been deferred. The central bank reiterated its signal that the current base rate level would apply
for much of 2024. SpareBank 1 SMN has raised mortgage and deposit rates in step with Norges Bank's rate changes in recent years, and has from March 2024 effectuated the latest interest rate hike by the central bank, which will gain full effect in the second quarter of 2024.
The group saw strong cost growth through 2023 due to investments in technology development, growth initiatives and competencies. In 2024 the cost trend in the group will be in particular focus, and the group's cost growth is expected to normalise.
The risk picture in SpareBank 1 SMN's loan portfolio is satisfactory, although higher interest rates and lower activity levels in the economy have prompted increased uncertainty. However, there are few indications of any deterioration of the portfolio's credit quality, as reflected in continued low losses.
The group's liquidity and capital position is robust. A the end of the first quarter the group had a CET1 ratio of 18.5 per cent and is thus well positioned to fulfil its growth aspirations.
SpareBank 1 SMN aspires to be among the best-performing financial institutions in the Nordic region, and the group's overriding financial goal is to deliver a return on equity of at least 13 per cent over time. The board of directors is pleased with results achieved in the year's first quarter and expects 2024 to be a good year for the group.
Trondheim, 7. May 2024 The Board of Directors of SpareBank 1 SMN
(chair) (deputy chair)
Kjell Bjordal Christian Stav Mette Kamsvåg
Freddy Aursø Nina Olufsen Ingrid Finboe Svendsen
Kristian Sætre Christina Straub Inge Lindseth
(employee rep.) (employee rep.)
Jan-Frode Janson (Group CEO)
Income statement
| Parent bank | Group | |||||||
|---|---|---|---|---|---|---|---|---|
| Jan - Mar | Jan - Mar | |||||||
| 2023 | 2023 | 2024 (NOKm) | Note | 2024 | 2023 | 2023 | ||
| 9,219 | 1,889 | 2,693 Interest income effective interest method | 2,831 | 2,014 | 9,721 | |||
| 1,548 | 346 | 417 Other interest income | 422 | 353 | 1,542 | |||
| 6,622 | 1,331 | 1,943 Interest expenses | 1,947 | 1,332 | 6,631 | |||
| 4,144 | 903 | 1,168 Net interest | 10 | 1,306 | 1,035 | 4,632 | ||
| 1,117 | 281 | 298 Commission income | 367 | 341 | 1,370 | |||
| 114 | 26 | 32 Commission expenses | 51 | 50 | 199 | |||
| 73 | 16 | 12 Other operating income | 257 | 249 | 913 | |||
| 1,076 | 271 | 279 Commission income and other income | 11 | 572 | 541 | 2,084 | ||
| 711 | 4 | 115 Dividends | 3 | 2 | 26 | |||
| - | - | - Income from investment in related companies | 3 | 194 | 125 | 297 | ||
| 464 | -57 | 60 Net return on financial investments | 13 | 84 | -99 | 476 | ||
| 1,176 | -54 | 175 Net return on financial investments | 281 | 28 | 799 | |||
| 6,396 | 1,120 | 1,622 Total income | 2,159 | 1,604 | 7,515 | |||
| 849 | 189 | 252 Staff costs | 482 | 398 | 1,691 | |||
| 1,121 | 280 | 237 Other operating expenses | 12 | 299 | 330 | 1,326 | ||
| 1,969 | 469 | 490 Total operating expenses | 782 | 728 | 3,017 | |||
| 4,426 | 651 | 1,132 Result before losses | 1,377 | 875 | 4,498 | |||
| -72 | -77 | 21 Loss on loans, guarantees etc. | 6, 7 | 24 | -71 | 14 | ||
| 4,498 | 728 | 1,111 Result before tax | 3 | 1,353 | 946 | 4,484 | ||
| 820 | 176 | 242 Tax charge | 273 | 206 | 904 | |||
| - | - | - Result investment held for sale, after tax | 2, 3 | 3 | 38 | 108 | ||
| 3,678 | 552 | 869 Net profit | 1,084 | 778 | 3,688 | |||
| 122 | 39 | 39 Attributable to additional Tier 1 Capital holders | 48 | 34 | 125 | |||
| 2,376 | 328 | 554 Attributable to Equity capital certificate holders | 675 | 455 | 2,331 | |||
| 1,181 | 185 | 276 Attributable to the saving bank reserve | 336 | 256 | 1,159 | |||
| Attributable to non-controlling interests | 25 | 33 | 74 | |||||
| 3,678 | 552 | 869 Net profit | 1,084 | 778 | 3,688 | |||
| Profit/diluted profit per ECC | 19 | 4.68 | 3.51 | 16.88 |
Other comprehensive income
| Parent bank | ||||||
|---|---|---|---|---|---|---|
| Jan - Mar | Jan - Mar | |||||
| 2023 | 2023 | 2024 (NOKm) | 2024 | 2023 | 2023 | |
| 3,678 | 552 | 869 Net profit | 1,084 | 778 | 3,688 | |
| Items that will not be reclassified to profit/loss | ||||||
| -27 | - | - Actuarial gains and losses pensions | - | - | -27 | |
| 7 | - | - Tax | - | - | 7 | |
| Share of other comprehensive income of associates and joint | ||||||
| - | - | - | venture | 1 | 1 | 6 |
| -20 | - | - Total | 1 | 1 | -14 | |
| Items that will be reclassified to profit/loss | ||||||
| -5 | 5 | 0 Value changes on loans measured at fair value | 0 | 5 | -5 | |
| - | - | - | Share of other comprehensive income of associates and joint | -33 | -16 | -140 |
| venture | ||||||
| -5 | 5 | 0 Total | -33 | -11 | -145 | |
| -25 | 5 | 0 Net other comprehensive income | -32 | -10 | -158 | |
| 3,653 | 558 | 869 Total comprehensive income | 1,051 | 768 | 3,530 | |
| 122 | 33 | 39 Attributable to additional Tier 1 Capital holders | 48 | 34 | 125 | |
| 2,359 | 336 | 554 Attributable to Equity capital certificate holders | 653 | 448 | 2,225 | |
| 1,173 | 189 | 276 Attributable to the saving bank reserve | 325 | 253 | 1,106 | |
| Attributable to non-controlling interests | 25 | 33 | 74 | |||
| 3,653 | 558 | 869 Total comprehensive Income | 1,051 | 768 | 3,530 |
Balance sheet
| Parent bank | |||||||
|---|---|---|---|---|---|---|---|
| 31 Dec 23 | 31 Mar 23 | 31 Mar 24 (NOKm) | Note | 31 Mar 24 | 31 Mar 23 | 31 Dec 23 | |
| 1,172 | 1,241 | 2,021 Cash and receivables from central banks | 2,021 | 1,241 | 1,172 | ||
| 19,241 | 19,259 | 18,721 Deposits with and loans to credit institutions | 8,630 | 8,746 | |||
| 156,464 | 139,845 | 155,824 Net loans to and receivables from customers | 5 | 168,407 | 152,208 | 168,955 | |
| 34,163 | 44,329 | 36,080 Fixed-income CDs and bonds | 17 | 36,080 | 44,330 | 34,163 | |
| 6,659 | 7,073 | 7,260 Derivatives | 17 | 7,260 | 7,073 | 6,659 | |
| 731 | 429 | 715 Shares, units and other equity interests | 17 | 1,156 | 826 | 1,137 | |
| 6,270 | 5,069 | 6,547 Investment in related companies | 9,024 | 7,913 | 8,695 | ||
| 2,090 | 1,924 | 2,090 Investment in group companies | - | - | - | ||
| 98 | 554 | 98 Investment held for sale | 2 | 104 | 1,509 | 112 | |
| 812 | 467 | 808 Intangible assets | 1,234 | 670 | 1,228 | ||
| 1,321 | 3,246 | 1,682 Other assets | 14 | 2,295 | 3,808 | 1,849 | |
| 229,020 | 223,434 | 231,846 Total assets | 235,721 | 228,207 | 232,717 | ||
| 13,160 | 15,875 | 14,941 Deposits from credit institutions | 14,941 | 15,875 | 13,160 | ||
| 133,462 | 124,202 | 134,986 Deposits from and debt to customers | 9 | 134,395 | 123,529 | 132,888 | |
| 45,830 | 49,363 | 43,772 Debt created by issue of securities | 16 | 43,770 | 49,361 | 45,830 | |
| 6,989 | 7,792 | 7,084 Derivatives | 17 | 7,792 | 6,989 | ||
| 2,262 | 4,168 | 5,013 Other liabilities | 15 | 5,773 | 4,880 | 3,005 | |
| - | - | - Investment held for sale | 2 | 2 | 620 | 1 | |
| 2,169 | 2,015 | 2,672 Subordinated loan capital 16 |
2,752 | 2,058 | 2,247 | ||
| 203,871 | 203,414 | 208,468 Total liabilities | 208,716 | 204,115 | 204,120 | ||
| 2,884 | 2,597 | 2,884 Equity capital certificates | 2,884 | 2,597 | 2,884 | ||
| - | -0 | -2 Own holding of ECCs | -2 | -8 | - | ||
| 2,422 | 895 | 2,422 Premium fund | 2,422 | 895 | 2,409 | ||
| 8,482 | 7,877 | 8,472 Dividend equalisation fund | 8,472 | 7,838 | 8,482 | ||
| 1,730 | - | - Recommended dividends | - | - | 1,730 | ||
| 860 | - | - Provision for gifts | - | - | 860 | ||
| 6,865 | 6,408 | 6,865 Ownerless capital | 6,865 | 6,408 | 6,865 | ||
| 106 | 70 | 106 Unrealised gains reserve | 106 | 70 | 106 | ||
| - | 5 | 0 Other equity capital | 2,620 | 2,825 | 2,690 | ||
| 1,800 | 1,617 | 1,761 Additional Tier 1 Capital | 1,862 | 1,659 | 1,903 | ||
| 552 | 869 Profit for the period | 1,084 | 778 | - | |||
| - | - | - Non-controlling interests | 691 | 1,031 | 666 | ||
| 25,150 | 20,021 | 23,378 Total equity capital | 27,004 | 24,092 | 28,597 | ||
| 229,020 | 223,434 | 231,846 Total liabilities and equity | 235,721 | 228,207 | 232,717 |
Cash flow statement
| Parent bank | ||||||
|---|---|---|---|---|---|---|
| 31 Dec 23 |
31 Mar 23 |
31 Mar | 24 (mill. kr) | 31 Mar 24 |
31 Mar 23 |
31 Dec 23 |
| -6,270 | -179 | 655 Decrease/(increase) of loans to customers | 562 | -549 | -6,838 | |
| 8,263 | 1,707 | 2,472 Interest receipts from loans to customers | 2,625 | 1,832 | 8,805 | |
| 4,331 | 2,713 | 523 Decrease/(increase) of loans to credit institutions | 609 | 3,034 | 4,517 | |
| 856 | 166 | 228 Interest receipts from loans to credit institutions | 205 | 159 | 783 | |
| 622 | 1,228 | 1,076 Increase/(decrease) of deposits from customers | 1,059 | 1,245 | 738 | |
| -3,632 | -422 | -719 Interest payments on deposits from customers | -711 | -415 | -3,600 | |
| -1,480 | 1,240 | 1,774 Increase/(decrease) of debt to credit institutions | 1,774 | 1,240 | -1,472 | |
| -514 | -111 | -149 Interest payments on debt to credit institutions | -149 | -111 | -514 | |
| 5,879 | -4,355 | -1,341 Increase/(decrease) in short term investments | -1,325 | -4,355 | 5,881 | |
| 1,288 | 281 | 347 Interest receipts from short term investments | 345 | 280 | 1,282 | |
| 221 | -404 | -510 Increase/(decrease) in derivatives | -510 | -404 | 221 | |
| -802 | -268 | -315 Interest receipts from derivatives | -315 | -268 | -802 | |
| 2,084 | -808 | 139 Increase/(decrease) in other claims | 382 | -576 | 2,946 | |
| -2,822 | 113 | -598 Increase/(decrease) in other debts | -931 | -155 | -3,936 | |
| 8,025 | 903 | 3,582 A) Net change in liquidity from operations | 3,619 | 959 | 8,016 | |
| 35 | - | - Increase of cash by merging | - | - | 35 | |
| -125 | -70 | -104 Gross investment buildings/operating assets | -128 | -107 | -207 | |
| - | - | - Sale of buildings/operating assets | - | - | - | |
| 302 | - | - Dividends from subsidiaries | - | - | -0 | |
| - | - | - Paid in capital due to reduction of shareholding in subsidiaries | - | - | - | |
| -69 | - | - Payment of capital due to increase in shareholding in subsidiaries | - | - | - | |
| 391 | - | - Dividends from associated companies and joint ventures | - | - | 391 | |
| 43 Proceeds from sale of shares of associated companies and joint | ||||||
| 123 | 35 | ventures | 43 | 30 | 142 | |
| -190 | -36 | -319 Payment for purchase of shares of associated companies and joint ventures |
-319 | -36 | -198 | |
| - | - | - Proceeds from shares held for sale | 12 | - | 163 | |
| 18 | 4 | 6 Dividends from other businesses | 3 | 2 | 26 | |
| 1,590 | - | 0 Reduction/sale of shares and ownership interests | 23 | 0 | 1,638 | |
| -1,487 | -1 | 42 Increase/purchase of shares and ownership interests | - | -4 | -1,509 | |
| 589 | -68 | -332 B) Net change in liquidity from investments | -366 | -114 | 482 | |
| 5,280 | 827 | 357 Debt raised by issuance of covered bonds | 357 | 827 | 5,280 | |
| -11,204 | -1,241 | -2,899 Repayment of issued covered bonds | -2,899 | -1,241 | -11,204 | |
| -1,207 | -218 | -273 Interest payment on covered bonds issued | -273 | -218 | -1,207 | |
| 750 | - | 500 Debt raised by issuance of subordinated debt | 502 | - | 826 | |
| -750 | - | - Payments of issued subordinated debt | - | - | -793 | |
| -125 | -24 | -37 Interest payment on subordinated debt | -39 | -25 | -128 | |
| 2 | -0 | -11 Proceeds from sale or issue of treasury shares | -11 | 0 | 153 | |
| -840 | - | - Dividends cleared | - | - | -840 | |
| - | - | - Dividends paid to non-controlling interests | - | - | -121 | |
| -474 | - | - Disbursed from gift fund | - | - | -474 | |
| 416 | - | - Additional Tier 1 Capital issued | - | - | 519 | |
| -342 | -76 | - Repayment of Additional Tier 1 Capital | - | -76 | -385 | |
| -122 | -33 | -39 Interest payments on additional Tier 1 capital | -41 | -42 | -125 | |
| -8,615 | -765 | -2,401 C) Net change in liquidity from financial activities | -2,403 | -774 | -8,498 | |
| 1 | 70 | 849 A) + B) + C) Net changes in cash and cash equivalents | 849 | 70 | 1 | |
| 1,171 | 1,171 | 1,172 Cash and cash equivalents at 1.1 | 1,172 | 1,171 | 1,171 | |
| 1,172 | 1,241 | 2,021 Cash and cash equivalents at end of the period | 2,021 | 1,241 | 1,172 | |
| 1 | 70 | 849 Net changes in cash and cash equivalents | 849 | 70 | 1 |
Change in equity
| 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 2023 | 2,597 | 895 | 6,408 | 7,877 | 1,314 | 70 | 0 | 1,726 20,887 | |
| Net profit | - | - | 299 | 602 | 2,591 | 37 | 27 | 122 | 3,678 |
| Other comprehensive income | |||||||||
| Financial assets through OCI | - | - | - | - | - | - | -5 | - | -5 |
| Actuarial gains (losses), pensions | - | - | - | - | - | - | -20 | - | -20 |
| Other comprehensive income | - | - | - | - | - | - | -25 | - | -25 |
| Total comprehensive income | - | - | 299 | 602 | 2,591 | 37 | 3 | 122 | 3,653 |
| Transactions with owners | |||||||||
| Dividend declared for 2022 | - | - | - | - | -840 | - | - | - | -840 |
| To be disbursed from gift fund | - | - | - | - | -474 | - | - | - | -474 |
| Additional Tier 1 Capital | - | - | - | - | - | - | - | 416 | 416 |
| Buyback additional Tier 1 Capital issued | - | - | - | - | - | - | - | -342 | -342 |
| Interest payments additional Tier 1 capital | - | - | - | - | - | - | - | -122 | -122 |
| Purchase and sale of own ECCs | -0 | - | - | 3 | - | - | - | - | 2 |
| Merging with SpareBank 1 Søre Sunnmøre | 288 | 1,526 | 158 | - | - | - | - | - | 1,972 |
| Direct recognitions in equity | - | - | - | - | - | - | -3 | - | -3 |
| Total transactions with owners | 287 | 1,526 | 158 | 3 | -1,314 | - | -3 | -48 | 610 |
| Equity at 31 December 2023 | 2,884 | 2,422 | 6,865 | 8,482 | 2,591 | 106 | 0 | 1,800 25,150 | |
| Equity at 1 January 2024 | 2,884 | 2,422 | 6,865 | 8,482 | 2,591 | 106 | 0 | 1,800 25,150 | |
| Net profit | - | - | - | - | - | - | 869 | - | 869 |
| Other comprehensive income | - | - | - | - | - | - | - | - | - |
| Value changes on loans measured at fair | - | - | - | - | - | - | 0 | - | 0 |
| value | |||||||||
| Actuarial gains (losses), pensions | - | - | - | - | - | - | - | - | - |
| Other comprehensive income | - | - | - | - | - | - | 0 | - | 0 |
| Total comprehensive income | - | - | - | - | - | - | 869 | - | 869 |
| Transactions with owners | |||||||||
| Dividend declared for 2023 | - | - | - | - | -1,730 | - | - | - | -1,730 |
| To be disbursed from gift fund | - | - | - | - | -860 | - | - | - | -860 |
| Additional Tier 1 Capital | - | - | - | - | - | - | - | - | - |
| Buyback Additional Tier 1 Capital issued | - | - | - | - | - | - | - | - | - |
| Interest payments additional Tier 1 capital | - | - | - | - | - | - | - | -39 | -39 |
| Purchase and sale of own ECCs | -1 | - | - | -9 | - | - | - | - | -11 |
| Direct recognitions in equity | - | - | - | - | - | - | - | - | - |
| Total transactions with owners | -1 | - | - | -9 | -2,591 | - | - | -39 | -2,641 |
| Equity at 31 March 2024 | 2,883 | 2,422 | 6,865 | 8,472 | - | 106 | 869 | 1,761 23,378 |
1st Quarter 2024
| 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 2023 | 2,586 | 895 | 6,408 | 7,828 | 1,314 | 70 | 2,940 | 1,769 | 997 24,807 | |
| Implementation effect of IFRS 17 in SpareBank 1 Gruppen 2) |
- | - | 299 | 602 | 2,591 | 37 | -40 | 125 | 74 | 3,688 |
| Other comprehensive income | - | - | - | - | - | - | - | - | - | - |
| Share of other comprehensive income of associates and joint ventures |
- | - | - | - | - | - | -133 | - | - | -133 |
| Value changes on loans measured at fair value |
- | - | - | - | - | - | -5 | - | - | -5 |
| Actuarial gains (losses), pensions | - | - | - | - | - | - | -20 | - | - | -20 |
| Other comprehensive income | - | - | - | - | - | - | -158 | - | - | -158 |
| Total comprehensive income | - | - | 299 | 602 | 2,591 | 37 | -198 | 125 | 74 | 3,530 |
| Transactions with owners | ||||||||||
| Dividend declared for 2022 | - | - | - | - | -840 | - | - | - | - | -840 |
| To be disbursed from gift fund | - | - | - | - | -474 | - | - | - | - | -474 |
| Additional Tier 1 Capital issued | - | - | - | - | - | - | - | 519 | - | 519 |
| Buyback Additional Tier 1 Capital issued |
- | - | - | - | - | - | - | -385 | - | -385 |
| Interest payments additional Tier 1 capital |
- | - | - | - | - | - | - | -125 | - | -125 |
| Purchase and sale of own ECCs | -0 | - | - | 3 | - | - | - | - | - | 2 |
| Own ECC held by SB1 Markets 1) | 11 | - | - | 49 | - | - | 10 | - | - | 70 |
| Merging with SpareBank 1 Søre Sunnmøre |
288 | 1,526 | 158 | - | - | - | - | - | -93 | 1,879 |
| SB1 Markets from subsidiary to associated company |
- | - | - | - | - | - | 110 | - | - | 110 |
| Direct recognitions in equity | - | - | - | - | - | - | -16 | - | - | -16 |
| Share of other transactions from associates and joint ventures |
- | - | - | - | - | - | -169 | - | - | -169 |
| Change in non-controlling interests | - | - | - | - | - | - | - | - | -312 | -312 |
| Total transactions with owners | 298 | 1,526 | 158 | 52 | -1,314 | - | -65 | 10 | -405 | 260 |
| Equity at 31 December 2023 | 2,884 | 2,422 | 6,865 | 8,482 | 2,591 | 106 | 2,677 | 1,903 | 666 28,597 |
*) Holding of own equity certificates as part of SpareBank 1 Markets' trading activity
| 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 2024 | 2,884 | 2,422 | 6,865 | 8,482 | 2,591 | 106 | 2,677 | 1,903 | 666 28,597 | |
| Net profit | - | - | - | - | - | - | 1,059 | - | 25 | 1,084 |
| Other comprehensive income | - | - | - | - | - | - | - | - | - | - |
| Share of other comprehensive income of associates and joint ventures |
- | - | - | - | - | - | -32 | - | - | -32 |
| Value changes on loans measured at fair value |
- | - | - | - | - | - | 0 | - | - | 0 |
| Actuarial gains (losses), pensions | - | - | - | - | - | - | - | - | - | - |
| Other comprehensive income | - | - | - | - | - | - | -32 | - | - | -32 |
| Total comprehensive income | - | - | - | - | - | - | 1,027 | - | 25 | 1,051 |
| Transactions with owners | ||||||||||
| Dividend declared for 2023 | - | - | - | - | -1,730 | - | - | - | - | -1,730 |
| To be disbursed from gift fund | - | - | - | - | -860 | - | - | - | - | -860 |
| Additional Tier 1 capital issued | - | - | - | - | - | - | - | - | - | - |
| Buyback additional Tier 1 Capital issued |
- | - | - | - | - | - | - | - | - | - |
| Interest payments additional Tier 1 capital |
- | - | - | - | - | - | - | -41 | - | -41 |
| Purchase and sale of own ECCs | -1 | - | - | -9 | - | - | - | - | - | -11 |
| Direct recognitions in equity | - | - | - | - | - | - | 0 | - | - | 0 |
| Other transactions from associates and joint ventures |
- | - | - | - | - | - | -0 | - | - | -0 |
| Change in non-controlling interests | - | - | - | - | - | - | - | - | 0 | 0 |
| Total transactions with owners | -1 | - | - | -9 | -2,591 | - | -0 | -41 | 0 | -2,643 |
| Equity at 31 March 2024 | 2,883 | 2,422 | 6,865 | 8,472 | - | 106 | 3,704 | 1,862 | 691 27,005 |
Attributable to parent company equity holders
*) Holding of own equity certificates as part of SpareBank 1 Markets' trading activity
2) The change in principle as a result of the implementation of IFRS 17 is described in Note 1 Accounting Principles
| Note 1 - Accounting principles 26 | |
|---|---|
| Note 2 - Critical estimates and assessment concerning the use of accounting principles 27 | |
| Note 3 - Account by business line 29 | |
| Note 4 - Capital adequacy 31 | |
| Note 5 - Distribution of loans by sector/industry 33 | |
| Note 6 - Losses on loans and guarantees 34 | |
| Note 7 - Losses 35 | |
| Note 8 - Gross Loans 41 | |
| Note 9 - Distribution of customer deposits by sector/industry 43 | |
| Note 10 - Net interest income 44 | |
| Note 11 - Net commission income and other income 45 | |
| Note 12 - Operating expenses 46 | |
| Note 13 - Net return on financial investments 47 | |
| Note 14 - Other assets 48 | |
| Note 15 - Other liabilities 49 | |
| Note 16 - Debt created by issue of securities and subordinated debt 50 | |
| Note 17 - Measurement of fair value of financial instruments 51 | |
| Note 18 - Liquidity risk 54 | |
| Note 19 - Earnings per EC 55 |
Note 1 - Accounting principles
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®Accounting Standards 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 2023. The Group has in this quarterly report used the same accounting principles and calculation methods as in the latest annual report and accounts, with the exception of statement of cash flows as described below.
Statement of cash flows
With effect from 1 January 2024, SpareBank 1 SMN has presented cash flow from operations according to the direct method in accordance with IAS 7. The change in principle is voluntary and has been implemented because it provides better information to users of the financial statements. The change in principle has been implemented retrospectively and comparative figures have been restated.
Note 2 - Critical estimates and assessment concerning the use of accounting principles
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.
Investment held for sale
SpareBank 1 SMN's strategy is that ownership duse 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.
| Assets | Liabilities | Revenue | Expenses | Profit | Ownership | |
|---|---|---|---|---|---|---|
| Mavi XV AS Group | 104 | 2 | 3 | - | 3 | 100 % |
| Total Held for sale | 104 | 2 | 3 | - | 3 |
Losses on loans and guarantees
For a detailed description of the Bank's model for expected credit losses, refer to note 3 and note10 in the annual accounts for 2023.
Measurement of expected credit loss for each stage requires both information on events and current conditions and information on expected events and future economic conditions. Estimation and use of forward-looking information requires a high degree of discretionary judgement. Each macroeconomic scenario that is utilised includes a projection for a five-year period. For credits where credit risk is assessed to have increased significantly since loan approval (stage 2), loss estimates for the period after year 5 are based on year 5 as regards level of PD and LGD.
Our estimate of expected credit loss at stage 1 and 2 is a probability-weighted average of three scenarios: Base Case, Best Case and Worst Case. The model that computes model write-downs is based on two macro variables – interest rate level (three-month NIBOR) and unemployment (Statistics Norway's Labour Force Survey, AKU). The assumptions in the baseline scenario are based on the assumptions in Norges Bank's Monetary Policy Report 1/24. The downside scenario features high interest rates and high unemployment, which are largely based on Finanstilsynet's stress test reported in Financial Outlook, June 2023. The upside scenario features low interest rates and low unemployment.
Calculation of the group's overall model write-downs is based on calculations of expected credit loss (ECL) for each of five portfolios below. For each portfolio, separate assumptions are defined with regard to how the macro variables 'interest rate' and 'unemployment' impact PD and LGD. The relationships between the macro variables are developed using of regression analysis and simulation, while the relationships between the macro variables and LGD are based largely on expert assessments and discretionary judgement. The five portfolios are:
- Residential mortgages
- Other retail loans
- Agriculture
- Industries with large balance sheets / high long-term debt ratios (real estate, shipping, offshore, aquaculture, fishery)
- Industries with smaller balance sheets / low long-term debt ratios (other industries)
As in the previous quarter, the building and construction industry is generally considered to have acquired significantly increased credit risk since loan approval and customers in this industry are accordingly classified to stage 2 or 3. Customers in some fishery segments have also been moved to stage 2 for the same reason.
ECL as at 31 March 2024 is calculated as a combination of 80 per cent expected scenario, 10 per cent downside scenario and 10 per cent upside scenario (80/10/10 pct).
The effect of the change of assumptions in 2024 is shown in the line "Effect of changed assumptions in the ECL model" in note 7.
The model write-downs are reduced in the quarter for the retail market due a somewhat lower interest rate path than in the previous quarter in the baseline scenario and an upward adjustment of the expected trend in house prices. The model write-downs in the corporate portfolio have increased, in particular with respect to fishery due to increased credit risk. Overall, this amounts to NOK 32m for the bank and NOK 22m for the group in terms of increased write-downs.
Sensitivity
The first part of the table below show total calculated expected credit loss as of 31 March 2023 in each of the three scenarios, distributed in the portfolios Retail Market, Corporate Market and offshore, tourism and agriculture, which adds up to parent bank. In addition the subsidiary SpareBank 1 Finans Midt-Norge is included. 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 scenaro weight has been doubled.
If the downside scenario's probability were doubled at the expense of the baseline scenario at the end of March 2023, this would have entailed an increase in loss provisions of NOK 105 million for the parent bank and NOK 124 million for the group.
| SB 1 | SB 1 | ||||||
|---|---|---|---|---|---|---|---|
| Total | Finans | Finans | Total | ||||
| CM | RM | Agriculture | parent | MN, CM | MN, RM | group | |
| ECL base case | 626 | 86 | 72 | 784 | 39 | 16 | 839 |
| ECL worst case | 1,326 | 259 | 257 | 1,842 | 161 | 76 | 2,078 |
| ECL best case | 407 | 51 | 40 | 498 | 20 | 11 | 528 |
| ECL with scenario weights used 80/10/10 | 674 | 99 | 88 | 861 | 49 | 22 | 932 |
| ECL alternative scenario weights 70/20/10 | 744 | 117 | 106 | 967 | 61 | 28 | 1,056 |
| Total ECL used | 70 | 17 | 18 | 105 | 12 | 6 | 124 |
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 60 per cent of the ECL in the expected scenario. The downside scenario gives about double the ECL than in the expected scenario. Applied scenario weighting gives about 10 percent higher ECL than in the expected scenario.
Note 3 - Account by business line
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.
Group 31 March 2024
| Sunnmøre | SB 1 | SB 1 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| og | Finans | Regnskaps | |||||||
| Profit and loss account (NOKm) | RM | CM | Fjordane | EM 1 | MN | huset SMN | Other Uncollated | Total | |
| Net interest | 460 | 341 | 149 | 2 | 130 | 1 | - | 224 | 1,306 |
| Interest from allocated capital | 101 | 58 | 37 | - | - | - | - | -197 | - |
| Total interest income | 561 | 399 | 186 | 2 | 130 | 1 | - | 27 | 1,306 |
| Comission income and other income | 168 | 56 | 34 | 115 | -22 | 216 | - | 5 | 572 |
| Net return on financial investments **) | -0 | 1 | 2 | - | - | - | 194 | 85 | 281 |
| Total income | 729 | 456 | 222 | 117 | 108 | 217 | 194 | 117 | 2,159 |
| Total operating expenses | 143 | 49 | 50 | 97 | 39 | 182 | - | 222 | 782 |
| Ordinary operating profit | 586 | 406 | 172 | 20 | 69 | 35 | 194 | -105 | 1,377 |
| Loss on loans, guarantees etc. | 11 | 18 | -8 | - | 3 | - | - | -0 | 24 |
| Result before tax | 575 | 389 | 180 | 20 | 66 | 35 | 194 | -105 | 1,353 |
| Return on equity *) | 18.9 % | 23.8 % | 14.2 % | 16.0 % |
Group 31 March 2023
| SB 1 | SB 1 | |||||||
|---|---|---|---|---|---|---|---|---|
| Finans | Regnskaps | |||||||
| Profit and loss account (NOKm) | RM | CM | EM 1 | MN | huset SMN | Other Uncollated | Total | |
| Net interest | 433 | 406 | 1 | 123 | 1 | - | 70 | 1,035 |
| Interest from allocated capital | 91 | 68 | - | - | - | - | -158 | - |
| Total interest income | 524 | 474 | 1 | 123 | 1 | - | -88 | 1,035 |
| Comission income and other income | 181 | 63 | 105 | -27 | 201 | - | 17 | 541 |
| Net return on financial investments **) | 1 | 4 | - | -7 | - | 131 | -101 | 28 |
| Total income | 706 | 541 | 107 | 90 | 202 | 131 | -172 | 1,604 |
| Total operating expenses | 325 | 127 | 89 | 30 | 158 | - | -0 | 728 |
| Ordinary operating profit | 381 | 413 | 18 | 59 | 44 | 131 | -172 | 875 |
| Loss on loans, guarantees etc. | 9 | -86 | - | 7 | - | - | -0 | -71 |
| Result before tax | 372 | 500 | 18 | 53 | 44 | 131 | -172 | 946 |
| Return on equity *) | 15.8 % | 28.4 % | 13.0 % |
Group 2023
| Sunnmøre | SB 1 | SB 1 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| og | Finans | Regnskaps | |||||||
| Profit and loss account (NOKm) | RM | CM | Fjordane | EM 1 | MN | huset SMN | Other Uncollated | Total | |
| Net interest | 1,824 | 1,335 | 598 | 2 | 490 | 4 | - | 379 | 4,632 |
| Interest from allocated capital | 328 | 195 | 112 | - | - | - | - | -634 | - |
| Total interest income | 2,151 | 1,530 | 709 | 2 | 490 | 4 | - | -255 | 4,632 |
| Comission income and other income | 652 | 234 | 110 | 432 | -97 | 716 | - | 37 | 2,084 |
| Net return on financial investments **) | 1 | 6 | 7 | 1 | -82 | - | 379 | 488 | 799 |
| Total income | 2,804 | 1,770 | 826 | 435 | 311 | 720 | 379 | 270 | 7,515 |
| Total operating expenses | 1,078 | 407 | 315 | 395 | 115 | 612 | - | 97 | 3,017 |
| Ordinary operating profit | 1,726 | 1,363 | 512 | 40 | 196 | 108 | 379 | 173 | 4,498 |
| Loss on loans, guarantees etc. | 1 | 45 | -118 | - | 86 | - | - | -0 | 14 |
| Result before tax | 1,725 | 1,318 | 629 | 40 | 111 | 108 | 379 | 173 | 4,484 |
| Return on equity *) | 18.2 % | 24.3 % | 19.6 % | 14.4 % |
*) Regulatory capital is used as a basis for calculating capital used in the Private market and Business.
| **) Specification of other (NOKm) | 31 Mar 24 | 31 Mar 23 | 31 Dec 23 |
|---|---|---|---|
| SpareBank 1 Gruppen | 40 | 34 | -34 |
| SpareBank 1 Boligkreditt | 33 | 33 | 98 |
| SpareBank 1 Næringskreditt | 4 | 2 | 10 |
| BN Bank | 84 | 62 | 257 |
| SpareBank 1 Markets | 25 | - | 19 |
| SpareBank 1 Kreditt | -4 | -4 | -13 |
| SpareBank 1 Betaling | -12 | -8 | -37 |
| SpareBank 1 Forvaltning | 10 | 8 | 35 |
| Other companies | 13 | 4 | 46 |
| Income from investment in associates and joint ventures | 194 | 131 | 379 |
| SpareBank 1 Mobilitet Holding | - | -7 | -82 |
| Net income from investment in associates and joint ventures | 194 | 125 | 297 |
Note 4 - Capital adequacy
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 31 March 2024 the overall minimum requirement on CET1 capital is 14.0 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 2.5 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 for SpareBank 1 SMN. From 31 December 2023, the requirement is 1.7 per cent and must be met with a minimum of 56.25 per cent. In addition the bank must have an additional 0.7 per cent in Pillar 2 requirements until the application for adjusting IRB-models has been processed.
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 31 March 2024, the average risk weights are over 20 per cent.
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 31 March 2024 the effective rate for the parent bank and for the group is accordingly 4.43 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. For the first quarter of 2024 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 2023 |
31 Mar 2023 |
31 Mar | 2024 (NOKm) | 31 Mar 2024 |
31 Mar 2023 |
31 Dec 2023 |
| 25,150 | 20,021 | 23,378 Total book equity | 27,004 | 24,092 | 28,597 | |
| -1,800 | -1,617 | -1,761 Additional Tier 1 capital instruments included in total equity |
-1,862 | -1,659 | -1,903 | |
| -812 | -467 | -808 Deferred taxes, goodwill and other intangible assets | -1,700 | -951 | -1,625 | |
| -2,591 | - | - Deduction for allocated dividends and gifts | - | - | -2,591 | |
| - | - | - | Non-controlling interests recognised in other equity capital |
-691 | -1,031 | -666 |
| - | - | - | Non-controlling interests eligible for inclusion in CET1 capital |
683 | 834 | 679 |
| - | -552 | -869 Net profit | -1,084 | -778 | - | |
| - | 147 | 73 Year-to-date profit included in core capital (50 per cent (50 per cent) pre tax of group profit) |
285 | 372 | - | |
| -53 | -78 | -56 Value adjustments due to requirements for prudent valuation |
-76 | -95 | -72 | |
| -412 | -258 | -348 Positive value of adjusted expected loss under IRB Approach |
-488 | -363 | -546 | |
| - | - | - Cash flow hedge reserve | -4 | -4 | -4 | |
| -350 | -281 | -350 Deduction for common equity Tier 1 capital in significant investments in financial institutions |
-268 | -460 | -278 | |
| 19,131 | 16,915 | 19,258 Common equity Tier 1 capital | 21,799 | 19,959 | 21,589 | |
| 1,800 | 1,650 | 1,800 Additional Tier 1 capital instruments | 2,322 | 2,073 | 2,252 | |
| -48 | -46 | -48 Deduction for significant investments in financial institutions |
-48 | -46 | -48 | |
| 20,883 | 18,519 | 21,010 Tier 1 capital | 24,073 | 21,985 | 23,793 | |
| - | ||||||
| - | Supplementary capital in excess of core capital | |||||
| 2,150 | 2,000 | 2,650 Subordinated capital | 3,390 | 2,522 | 2,822 | |
| -216 | -209 | -214 Deduction for significant investments in financial institutions |
-214 | -209 | -216 | |
| 1,934 | 1,791 | 2,436 Additional Tier 2 capital instruments | 3,177 | 2,313 | 2,606 | |
| 22,817 | 20,309 | 23,447 Total eligible capital | 27,250 | 24,298 | 26,399 |
| Minimum requirements subordinated capital | |||||
|---|---|---|---|---|---|
| 1,256 | 1,234 | 1,343 Specialised enterprises | 1,615 | 1,469 | 1,538 |
| 904 | 920 | 871 Corporate | 897 | 947 | 931 |
| 1,569 | 1,368 | 1,583 Mass market exposure, property | 3,015 | 2,587 | 2,907 |
| 124 | 108 | 127 Other mass market | 131 | 111 | 126 |
| 1,485 | 1,253 | 1,533 Equity positions IRB | - | - | - |
| 5,338 | 4,884 | 5,457 Total credit risk IRB | 5,658 | 5,113 | 5,502 |
| 3 | 3 | 5 Central government | 5 | 3 | 5 |
| 95 | 109 | 99 Covered bonds | 163 | 156 | 153 |
| 373 | 383 | 364 Institutions | 276 | 285 | 280 |
| 110 | 217 | 109 Local and regional authorities, state-owned enterprises | 146 | 242 | 146 |
| 248 | 174 | 290 Corporate | 557 | 421 | 506 |
| 4 | 7 | 9 Mass market | 708 | 679 | 703 |
| 37 | 36 | 44 Exposures secured on real property | 116 | 111 | 126 |
| 63 | 90 | 63 Equity positions | 478 | 501 | 465 |
| 112 | 102 | 133 Other assets | 206 | 180 | 178 |
| 1,046 | 1,121 | 1,116 Total credit risk standardised approach | 2,654 | 2,578 | 2,561 |
| 22 | 42 | 30 Debt risk | 31 | 43 | 22 |
| - | - | - Equity risk | 11 | 10 | 7 |
| - | - | - Currency risk and risk exposure for settlement/delivery | 0 | 4 | 2 |
| 545 | 458 | 545 Operational risk | 923 | 852 | 924 |
| 38 | 40 | 32 Credit value adjustment risk (CVA) | 141 | 149 | 153 |
| 6,988 | 6,544 | 7,180 Minimum requirements subordinated capital | 9,418 | 8,749 | 9,171 |
| 87,354 | 81,801 | 89,750 Risk weighted assets (RWA) | 117,721 | 109,366 | 114,633 |
| 3,931 | 3,681 | 4,039 Minimum requirement on CET1 capital, 4.5 per cent | 5,297 | 4,921 | 5,159 |
| Capital Buffers | |||||
| 2,184 | 2,045 | 2,244 Capital conservation buffer, 2.5 per cent | 2,943 | 2,734 | 2,866 |
| 3,896 | 3,640 | 4,003 Systemic risk buffer, 4.5 per cent | 5,218 | 4,867 | 5,081 |
| 2,184 | 2,045 | 2,244 Countercyclical buffer, 1.0 per cent | 2,943 | 2,734 | 2,866 |
| 8,264 | 7,730 | 8,490 Total buffer requirements on CET1 capital | 11,104 | 10,335 | 10,813 |
| 6,937 | 5,504 | 6,729 Available CET1 capital after buffer requirements | 5,397 | 4,702 | 5,618 |
| Capital adequacy | |||||
| 21.9 % | 20.7 % | 21.5 % Common equity Tier 1 capital ratio | 18.5 % | 18.2 % | 18.8 % |
| 23.9 % | 22.6 % | 23.4 % Tier 1 capital ratio | 20.4 % | 20.1 % | 20.8 % |
| 26.1 % | 24.8 % | 26.1 % Capital ratio | 23.1 % | 22.2 % | 23.0 % |
| Leverage ratio | |||||
| 221,334 | 216,517 | 224,379 Balance sheet items | 329,436 | 311,331 | 323,929 |
| 7,559 | 6,724 | 7,777 Off-balance sheet items | 9,211 | 8,046 | 8,984 |
| -513 | -382 | -452 Regulatory adjustments | -612 | -504 | -666 |
| 228,380 | 222,858 | 231,704 Calculation basis for leverage ratio | 338,035 | 318,873 | 332,247 |
| 20,883 9.1 % |
18,519 8.3 % |
21,010 Core capital 9.1 % Leverage Ratio |
24,073 7.1 % |
21,985 6.9 % |
23,793 7.2 % |
Note 5 - Distribution of loans by sector/industry
| Parent Bank | Group | |||||
|---|---|---|---|---|---|---|
| 31 Dec | 31 Mar | 31 Mar | 31 Mar | 31 Mar | 31 Dec | |
| 2023 | 2023 | 2024 (NOKm) | 2024 | 2023 | 2023 | |
| 12,021 | 10,773 | 11,919 Agriculture and forestry | 12,398 | 11,214 | 12,489 | |
| 5,459 | 7,095 | 5,599 Fisheries and hunting | 5,626 | 7,123 | 5,488 | |
| 2,218 | 1,864 | 2,239 Sea farming industries | 2,499 | 2,179 | 2,473 | |
| 3,170 | 2,736 | 3,206 Manufacturing | 3,806 | 3,321 | 3,757 | |
| 6,111 | 4,923 | 6,238 Construction, power and water supply | 7,484 | 6,086 | 7,353 | |
| 2,845 | 3,129 | 3,019 Retail trade, hotels and restaurants | 3,961 | 3,872 | 3,777 | |
| 6,030 | 5,700 | 5,066 Maritime sector | 5,066 | 5,700 | 6,030 | |
| 21,288 | 19,587 | 22,121 Property management | 22,237 | 19,703 | 21,400 | |
| 4,239 | 3,817 | 4,050 Business services | 4,904 | 4,635 | 5,148 | |
| 5,396 | 5,102 | 6,275 Transport and other services provision | 7,424 | 6,182 | 6,459 | |
| 2 | 3 | 10 Public administration | 46 | 37 | 39 | |
| 2,220 | 1,142 | 2,038 Other sectors | 1,958 | 1,094 | 2,140 | |
| 70,997 | 65,872 | 71,779 Gross loans in Corporate market | 77,407 | 71,146 | 76,553 | |
| 152,710 | 135,646 | 153,782 Wage earners | 160,863 | 142,822 | 159,777 | |
| 223,708 | 201,518 | 225,561 Gross loans incl. SB1 Boligkreditt /SB1 Næringskreditt |
238,270 | 213,967 | 236,329 | |
| 64,719 | 59,054 | 67,249 of which SpareBank 1 Boligkreditt | 67,249 | 59,054 | 64,719 | |
| 1,749 | 1,732 | 1,695 of which SpareBank 1 Næringskreditt | 1,695 | 1,732 | 1,749 | |
| 157,240 | 140,731 | 156,617 Total Gross loans to and receivables from customers |
169,326 | 153,181 | 169,862 | |
| 659 | 784 | 667 - Loan loss allowance on amortised cost loans | 793 | 870 | 790 | |
| 117 | 102 | 126 - Loan loss allowance on loans at FVOCI | 126 | 102 | 117 | |
| 156,464 | 139,845 | 155,824 Net loans to and receivables from customers | 168,407 | 152,208 | 168,955 |
Note 6 - Losses on loans and guarantees
| 2024 | 2023 | 2023 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Parent Bank (NOKm) | RM | CM | Total | RM | CM | Total | RM | CM | Total |
| Change in provision for expected credit losses | 10 | 11 | 21 | 6 | -93 | -87 | 4 | -59 | -55 |
| Actual loan losses on commitments exceeding provisions made | 2 | 2 | 4 | 5 | 7 | 11 | 11 | 146 | 157 |
| Recoveries on commitments previously written-off | -1 | -3 | -4 | -2 | -1 | -2 | -21 | -153 | -174 |
| Losses for the period on loans and guarantees | 11 | 10 | 21 | 9 | -86 | -77 | -6 | -66 | -72 |
| Jan - Mar | |||||||||
| 2024 | 2023 | 2023 | |||||||
| Group (NOKm) | RM | CM | Total | RM | CM | Total | RM | CM | Total |
| Change in provision for expected credit losses | 5 | 11 | 16 | 8 | -91 | -83 | 1 | -7 | -6 |
| Actual loan losses on commitments exceeding provisions made | 4 | 8 | 11 | 5 | 9 | 14 | 47 | 168 | 215 |
| Recoveries on commitments previously written-off | -1 | -3 | -4 | -2 | -1 | -2 | -40 | -155 | -195 |
Note 7 - Losses
| Net write | |||||
|---|---|---|---|---|---|
| 1 Jan | Change in | offs | 31 Mar | ||
| Parent Bank (NOKm) | 24 | provision | /recoveries | 24 | |
| Loans as amortised cost- CM | 671 | 6 | -1 | 677 | |
| Loans as amortised cost- RM | 43 | 5 | - | 48 | |
| Loans at fair value over OCI- RM | 137 | 5 | - | 142 | |
| Loans at fair value over OCI- CM | 13 | 4 | - | 17 | |
| Provision for expected credit losses on loans and guarantees | 864 | 21 | -1 | 884 | |
| Presented as | |||||
| Provision for loan losses | 776 | 18 | -1 | 793 | |
| Other debt- provisons | 53 | 3 | - | 55 | |
| Other comprehensive income - fair value adjustment | 36 | 0 | - | 36 | |
| Net write | |||||
| Change in | offs | 31 Mar | |||
| Parent Bank (NOKm) | 1 Jan 23 | provision | /recoveries | 23 | |
| Loans as amortised cost- CM | 921 | -93 | - | 828 | |
| Loans as amortised cost- RM | 35 | 7 | -3 | 39 | |
| Loans at fair value over OCI- RM | 147 | -1 | - | 146 | |
| Loans at fair value over OCI- CM | 2 | 0 | - | 2 | |
| Provision for expected credit losses on loans and guarantees | 1,106 | -87 | -3 | 1,015 | |
| Presented as | |||||
| Provision for loan losses | 999 | -109 | -3 | 887 | |
| Other debt- provisons | 67 | 17 | - | 83 | |
| Other comprehensive income - fair value adjustment | 40 | 5 | - | 45 | |
| Merge | Net write | ||||
| 1 Jan | Søre | Change in | offs | 31 Dec | |
| Parent Bank (NOKm) | 23 | Sunnmøre | provision | /recoveries | 23 |
| Loans as amortised cost- CM | 921 | 32 | -101 | -181 | 671 |
| Loans as amortised cost- RM | 35 | 11 | 2 | -5 | 43 |
| Loans at fair value over OCI- RM | 147 | - | -10 | - | 137 |
| Loans at fair value over OCI- CM | 2 | - | 11 | - | 13 |
| Provision for expected credit losses on loans and guarantees | 1,106 | 43 | -99 | -186 | 864 |
| Presented as | |||||
| Provision for loan losses | 999 | 41 | -77 | -186 | 776 |
| Other debt- provisons | 67 | 2 | -16 | - | 53 |
| Other comprehensive income - fair value adjustment | 40 | - | -5 | - | 36 |
| Net write | |||||
|---|---|---|---|---|---|
| 1 Jan | Change in | offs | 31 Mar | ||
| Group (NOKm) | 24 | provision | /recoveries | 24 | |
| Loans as amortised cost- CM | 777 | 7 | -1 | 783 | |
| Loans as amortised cost- RM | 68 | 0 | - | 69 | |
| Loans at fair value over OCI- RM | 137 | 5 | - | 142 | |
| Loans at fair value over OCI- CM | 13 | 4 | - | 17 | |
| Provision for expected credit losses on loans and guarantees | 995 | 16 | -1 | 1,011 | |
| Presented as | |||||
| Provision for loan losses | 907 | 13 | -1 | 919 | |
| Other debt- provisons | 53 | 3 | - | 55 | |
| Other comprehensive income - fair value adjustment | 36 | 0 | - | 36 | |
| Net write | |||||
| Change in | offs | 31 Mar | |||
| Group (NOKm) | 1 Jan 23 | provision | /recoveries | 23 | |
| Loans as amortised cost- CM | 976 | -91 | - | 885 | |
| Loans as amortised cost- RM | 63 | 9 | -3 | 69 | |
| Loans at fair value over OCI- RM | 147 | -1 | - | 146 | |
| Loans at fair value over OCI- CM | 2 | 0 | - | 2 | |
| Provision for expected credit losses on loans and guarantees | 1,188 | -83 | -3 | 1,101 | |
| Presented as | |||||
| Provision for loan losses | 1,081 | -105 | -3 | 973 | |
| Other debt- provisons | 67 | 17 | - | 83 | |
| Other comprehensive income - fair value adjustment | 40 | 5 | - | 45 | |
| Merge | Net write | ||||
| 1 Jan | Søre | Change in | offs | 31 Dec | |
| Group (NOKm) | 23 | Sunnmøre | provision | /recoveries | 23 |
| Loans as amortised cost- CM | 976 | 32 | -44 | -186 | 777 |
| Loans as amortised cost- RM | 63 | 11 | -1 | -5 | 68 |
| Loans at fair value over OCI- RM | 147 | - | -10 | - | 137 |
| Loans at fair value over OCI- CM | 2 | - | 11 | - | 13 |
| Provision for expected credit losses on loans and guarantees | 1,188 | 43 | -44 | -192 | 995 |
| Presented as | |||||
| Provision for loan losses | 1,081 | 41 | -23 | -192 | 907 |
| Other debt- provisons | 67 | 2 | -16 | - | 53 |
| Other comprehensive income - fair value adjustment | 40 | - | -5 | - | 36 |
1st Quarter 2024
Accrual for losses on loans
| 31 Mar 2024 | 31 Mar 2023 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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 | 38 | 95 | 45 | 179 | 46 | 93 | 42 | 181 | 46 | 93 | 42 | 181 |
| Transfer to (from) stage 1 |
14 | -14 | -0 | - | 20 | -20 | -0 | - | 18 | -18 | -0 | - |
| Transfer to (from) stage 2 |
-2 | 3 | -0 | - | -3 | 3 | -0 | - | -3 | 3 | -0 | - |
| Transfer to (from) stage 3 |
-0 | -5 | 5 | - | -0 | -5 | 5 | - | -0 | -8 | 9 | - |
| Net remeasurement of loss allowances |
-13 | 21 | 9 | 18 | -21 | 18 | 5 | 2 | -26 | 19 | -5 | -12 |
| Originations or purchases |
4 | 3 | 0 | 8 | 8 | 2 | 1 | 11 | 15 | 20 | 3 | 37 |
| Derecognitions | -3 | -10 | -2 | -15 | -6 | -9 | -3 | -18 | -14 | -31 | -4 | -49 |
| Changes due to changed input assumptions |
1 | -2 | -0 | -2 | 6 | 7 | -4 | 9 | 3 | 16 | 8 | 27 |
| Actual loan losses | 0 | 0 | - | - | - | - | -3 | -3 | 0 | 0 | -5 | -5 |
| Closing balance | 39 | 91 | 58 | 188 | 51 | 89 | 43 | 182 | 38 | 95 | 45 | 179 |
| Corporate Market | ||||||||||||
| Opening balance | 160 | 267 | 205 | 633 | 138 | 298 | 421 | 858 | 138 | 298 | 421 | 858 |
| Transfer to (from) stage 1 |
10 | -10 | -0 | - | 28 | -27 | -0 | - | 59 | -59 | -0 | - |
| Transfer to (from) stage 2 |
-4 | 4 | -0 | - | -4 | 14 | -10 | - | -14 | 24 | -10 | - |
| Transfer to (from) stage 3 |
-6 | -1 | 8 | - | -1 | -2 | 3 | - | -1 | -5 | 6 | - |
| Net remeasurement of loss allowances |
-13 | 28 | 11 | 26 | -31 | -56 | -20 | -107 | -58 | 11 | 9 | -38 |
| Originations or purchases |
21 | 10 | 3 | 34 | 18 | 1 | - | 19 | 90 | 35 | 37 | 163 |
| Derecognitions | -13 | -56 | -12 | -82 | -13 | -15 | -3 | -32 | -52 | -68 | -15 | -136 |
| Changes due to changed input assumptions |
6 | 25 | 0 | 31 | 7 | 5 | 0 | 12 | -2 | 31 | -62 | -33 |
| Actual loan losses | - | - | -1 | -1 | - | - | - | - | - | - | -181 | -181 |
| Closing balance | 160 | 267 | 214 | 641 | 141 | 218 | 391 | 750 | 160 | 267 | 205 | 633 |
| Total accrual for loan losses |
198 | 359 | 271 | 829 | 192 | 306 | 434 | 932 | 198 | 363 | 251 | 812 |
1st Quarter 2024
| 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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 | 46 | 111 | 46 | 204 | 55 | 107 | 47 | 209 | 55 | 107 | 47 | 209 | ||
| Transfer to (from) stage 1 |
18 | -18 | -0 | - | 21 | -21 | -0 | - | 21 | -20 | -1 | - | ||
| Transfer to (from) stage 2 |
-3 | 3 | -0 | - | -3 | 3 | -0 | - | -4 | 5 | -1 | - | ||
| Transfer to (from) stage 3 |
-0 | -6 | 6 | - | -0 | -6 | 6 | - | -1 | -10 | 11 | - | ||
| Net remeasurement of loss allowances |
-16 | 25 | 8 | 18 | -21 | 21 | 6 | 7 | -28 | 25 | -6 | -9 | ||
| Originations or purchases |
5 | 4 | 0 | 10 | 10 | 2 | 1 | 13 | 19 | 25 | 3 | 47 | ||
| Derecognitions | -4 | -11 | -2 | -17 | -6 | -10 | -3 | -19 | -17 | -34 | -7 | -58 | ||
| Changes due to changed input assumptions |
-1 | -5 | -0 | -6 | 5 | 5 | -4 | 6 | -0 | 14 | 7 | 21 | ||
| Actual loan losses | - | - | - | - | - | - | -3 | -3 | - | - | -5 | -5 | ||
| Closing balance | 46 | 103 | 59 | 208 | 60 | 103 | 49 | 212 | 46 | 111 | 46 | 204 | ||
| Corporate Market | ||||||||||||||
| Opening balance | 172 | 299 | 268 | 739 | 151 | 311 | 450 | 912 | 151 | 311 | 450 | 912 | ||
| Transfer to (from) stage 1 |
11 | -11 | -0 | - | 29 | -28 | -0 | - | 63 | -63 | -0 | - | ||
| Transfer to (from) stage 2 |
-5 | 6 | -0 | - | -5 | 15 | -10 | - | -18 | 28 | -10 | - | ||
| Transfer to (from) stage 3 |
-6 | -3 | 9 | - | -1 | -3 | 4 | - | -1 | -6 | 7 | - | ||
| Net remeasurement of loss allowances |
-13 | 31 | 11 | 29 | -29 | -53 | -19 | -101 | -59 | 22 | 60 | 23 | ||
| Originations or purchases |
22 | 12 | 4 | 38 | 20 | 2 | 1 | 22 | 96 | 46 | 38 | 181 | ||
| Derecognitions | -14 | -57 | -13 | -84 | -14 | -16 | -3 | -33 | -54 | -70 | -16 | -140 | ||
| Changes due to | ||||||||||||||
| changed input assumptions |
5 | 22 | -1 | 26 | 7 | 4 | -6 | 5 | -5 | 29 | -75 | -51 | ||
| Actual loan losses | - | - | -1 | -1 | - | - | - | - | - | - | -186 | -186 | ||
| Closing balance | 172 | 298 | 277 | 747 | 158 | 231 | 417 | 806 | 172 | 299 | 268 | 739 | ||
| Total accrual for loan losses |
218 | 401 | 336 | 955 | 219 | 334 | 465 | 1,018 | 218 | 410 | 314 | 943 |
Accrual for losses on guarantees and unused credit lines
| 31 Mar 2024 31 Mar 2023 |
31 Dec 2023 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Stage | Stage | Stage | Stage | Stage | Stage | Stage | Stage | Stage | ||||
| Parent Bank and Group (NOKm) | 1 | 2 | 3 Total | 1 | 2 | 3 Total | 1 | 2 | 3 Total | |||
| Opening balance | 18 | 27 | 8 | 53 | 24 | 34 | 9 | 67 | 24 | 34 | 9 | 67 |
| Transfer to (from) stage 1 | 3 | -3 | -0 | - | 1 | -1 | -0 | - | 6 | -6 | -0 | - |
| Transfer to (from) stage 2 | -0 | 0 | -0 | - | -0 | 0 | -0 | - | -2 | 2 | -0 | - |
| Transfer to (from) stage 3 | -0 | -0 | 1 | - | -0 | -0 | 0 | - | -0 | -1 | 1 | - |
| Net remeasurement of loss allowances | -4 | -0 | 0 | -4 | -4 | 11 | 4 | 12 | -13 | -4 | 2 | -15 |
| Originations or purchases | 2 | 0 | 5 | 7 | 10 | 1 | 0 | 11 | 9 | 4 | 0 | 13 |
| Derecognitions | -1 | -1 | -0 | -3 | -1 | -3 | -0 | -4 | -6 | -8 | -1 | -15 |
| Changes due to changed input assumptions |
1 | 2 | -0 | 2 | 2 | -4 | -0 | -2 | 0 | 5 | -3 | 2 |
| Actual loan losses | - | - | - | - | - | - | - | - | - | - | - | - |
| Closing balance | 17 | 25 | 13 | 55 | 31 | 39 | 13 | 83 | 18 | 27 | 8 | 53 |
| Of which | ||||||||||||
| Retail market | 3 | 3 | 1 | |||||||||
| Corporate Market | 53 | 81 | 51 |
Provision for credit losses specified by industry
| 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2022 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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 | 44 | 16 | 63 | 3 | 33 | 18 | 54 | 3 | 44 | 10 | 57 |
| Fisheries and hunting | 8 | 73 | - | 81 | 13 | 8 | - | 21 | 6 | 33 | 0 | 39 |
| Sea farming industries | 6 | 1 | 18 | 25 | 2 | 1 | 1 | 4 | 5 | 0 | 0 | 5 |
| Manufacturing | 10 | 29 | 14 | 52 | 9 | 39 | 5 | 53 | 15 | 31 | 13 | 59 |
| Construction, power and water supply |
35 | 28 | 32 | 96 | 38 | 22 | 15 | 75 | 46 | 25 | 28 | 99 |
| Retail trade, hotels and restaurants |
15 | 20 | 4 | 40 | 17 | 24 | 0 | 41 | 8 | 13 | 1 | 23 |
| Maritime sector | 6 | 18 | 102 | 127 | 6 | 22 | 152 | 180 | 7 | 54 | 103 | 164 |
| Property management | 37 | 72 | 27 | 136 | 33 | 63 | 23 | 119 | 44 | 92 | 22 | 159 |
| Business services | 20 | 20 | 6 | 46 | 14 | 33 | 178 | 226 | 17 | 16 | 24 | 57 |
| Transport and other services |
21 | 8 | 6 | 36 | 10 | 12 | 17 | 39 | 10 | 6 | 13 | 29 |
| Public administration | 0 | - | - | 0 | 0 | - | - | 0 | 0 | 0 | 0 | 0 |
| Other sectors | 1 | 1 | - | 1 | 0 | 0 | - | 0 | 1 | 0 | 0 | 1 |
| Wage earners | 1 | 44 | 46 | 91 | 0 | 49 | 25 | 74 | 1 | 47 | 35 | 83 |
| Total provision for losses on loans |
163 | 359 | 271 | 793 | 146 | 306 | 434 | 887 | 163 | 363 | 251 | 776 |
| loan loss allowance on loans at FVOCI |
36 | 36 | 45 | 45 | 36 | 36 | ||||||
| Total loan loss allowance |
198 | 359 | 271 | 829 | 192 | 306 | 434 | 932 | 198 | 363 | 251 | 812 |
1st Quarter 2024
| 31 Mar 2024 | 31 Mar 2023 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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 | 45 | 17 | 66 | 4 | 35 | 19 | 58 | 4 | 46 | 10 | 60 |
| Fisheries and hunting | 8 | 73 | 0 | 81 | 13 | 8 | 0 | 21 | 6 | 33 | 0 | 39 |
| Sea farming industries | 7 | 1 | 18 | 26 | 4 | 1 | 1 | 6 | 6 | 0 | 0 | 6 |
| Manufacturing | 13 | 33 | 17 | 63 | 13 | 43 | 11 | 67 | 18 | 36 | 13 | 68 |
| Construction, power and water supply |
35 | 45 | 36 | 116 | 43 | 25 | 20 | 88 | 46 | 42 | 33 | 121 |
| Retail trade, hotels and restaurants |
18 | 22 | 4 | 44 | 19 | 25 | 2 | 45 | 11 | 15 | 2 | 28 |
| Maritime sector | 6 | 18 | 102 | 127 | 6 | 22 | 152 | 180 | 7 | 54 | 103 | 164 |
| Property management | 37 | 73 | 27 | 137 | 34 | 63 | 23 | 120 | 45 | 93 | 22 | 160 |
| Business services | 23 | 22 | 59 | 104 | 16 | 34 | 186 | 237 | 19 | 18 | 78 | 114 |
| Transport and other services |
23 | 13 | 9 | 46 | 13 | 17 | 21 | 51 | 12 | 11 | 16 | 39 |
| Public administration | 0 | 0 | - | 0 | 0 | - | - | 0 | 0 | 0 | 0 | 0 |
| Other sectors | 1 | 1 | - | 1 | 0 | 0 | 0 | 0 | 1 | 0 | 0 | 1 |
| Wage earners | 7 | 54 | 47 | 109 | 8 | 61 | 30 | 99 | 8 | 62 | 36 | 106 |
| Total provision for losses on loans |
182 | 401 | 336 | 919 | 173 | 334 | 465 | 973 | 183 | 410 | 314 | 907 |
| loan loss allowance on loans at FVOCI |
36 | 36 | 45 | 45 | 36 | 36 | ||||||
| Total loan loss allowance |
218 | 401 | 336 | 955 | 219 | 334 | 465 | 1,018 | 218 | 410 | 314 | 943 |
Note 8 - Gross Loans
| 31 Mar 2024 | 31 Mar 2023 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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 | 90,901 | 4,553 | 725 | 96,178 | 80,994 | 3,962 | 527 | 85,484 | 80,994 | 3,962 | 527 | 85,484 |
| Transfer to stage 1 | 880 | -868 | -13 | - | 1,061 | -1,048 | -14 | - | 895 | -868 | -27 | - |
| Transfer to stage 2 | -875 | 889 | -14 | - | -1,003 | 1,010 | -7 | - | -1,538 | 1,557 | 1 | - |
| Transfer to stage 3 | -5 | -111 | 116 | - | -2 | -95 | 97 | - | -38 | -156 | 194 | - |
| Net increase/decrease amount existing loans |
-1,184 | -45 | -17 | -1,246 | -973 | -33 | -2 | -1,007 | -2,305 | -95 | -6 | -2,406 |
| New loans | 12,389 | 281 | 72 | 12,743 | 11,257 | 205 | 49 | 11,511 | 42,690 | 1,549 | 222 | 44,460 |
| Derecognitions | -12,729 | -525 | -93 | -13,346 | -11,250 | -489 | -59 | -11,798 | -29,797 | -1,395 | -149 | -31,342 |
| Financial assets with actual loan losses |
0 | 0 | -1 | -1 | -0 | - | -8 | -8 | 0 | 0 | -18 | -18 |
| Closing balance | 89,377 | 4,175 | 775 | 94,327 | 80,085 | 3,514 | 583 | 84,181 | 90,901 | 4,553 | 725 | 96,178 |
| Corporate Market | ||||||||||||
| Opening balance | 47,327 | 6,988 | 1,165 | 55,480 | 43,127 | 5,883 | 1,346 | 50,356 | 43,127 | 5,883 | 1,346 | 50,356 |
| Transfer to stage 1 | 249 | -245 | -5 | - | 791 | -787 | -4 | - | 1,026 | -1,021 | -5 | - |
| Transfer to stage 2 | -1,008 | 1,008 | -0 | - | -625 | 700 | -76 | - | -2,669 | 2,670 | -1 | - |
| Transfer to stage 3 | -4 | -31 | 35 | - | -11 | -16 | 27 | - | -72 | -44 | 116 | - |
| Net increase/decrease amount existing loans |
-131 | -55 | -3 | -189 | 106 | -66 | 2 | 42 | -1,099 | -485 | -10 | -1,594 |
| New loans | 6,193 | 1,257 | 188 | 7,638 | 4,732 | 30 | 47 | 4,810 | 17,922 | 816 | 351 | 19,089 |
| Derecognitions | -4,768 | -1,370 | -408 | -6,546 | -3,147 | -162 | -50 | -3,360 | -10,901 | -828 | -335 | -12,064 |
| Financial assets with actual loan losses |
0 | 0 | -3 | -3 | 0 | 0 | -5 | -5 | -7 | -2 | -298 | -307 |
| Closing balance | 47,858 | 7,553 | 969 | 56,380 | 44,972 | 5,582 | 1,288 | 51,843 | 47,327 | 6,988 | 1,165 | 55,480 |
| Fixed interest loans at FV |
5,909 | 5,909 | 4,707 | 4,707 | 5,582 | - | - | 5,582 | ||||
| Total gross loans at the end of the period |
143,145 | 11,727 | 1,744 156,617 129,764 | 9,096 | 1,872 140,731 143,809 | 11,541 | 1,890 157,240 |
1st Quarter 2024
| 31 Mar 2024 31 Mar 2023 |
31 Dec 2023 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 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 | 96,963 | 5,474 | 825 103,263 | 86,972 | 4,901 | 635 | 92,508 | 86,972 | 4,901 | 635 | 92,508 | |
| Transfer to stage 1 | 1,223 | -1,209 | -13 | - | 1,180 | -1,167 | -14 | - | 1,138 | -1,108 | -30 | - |
| Transfer to stage 2 | -1,052 | 1,070 | -18 | - | -1,219 | 1,229 | -10 | - | -1,955 | 1,978 | -23 | - |
| Transfer to stage 3 | -11 | -145 | 156 | - | -5 | -120 | 124 | - | -59 | -219 | 277 | - |
| Net increase/decrease amount existing loans |
-1,159 | -51 | -19 | -1,229 | -902 | -40 | -3 | -944 | -2,272 | -165 | -20 | -2,457 |
| New loans | 13,231 | 301 | 73 | 13,605 | 12,195 | 229 | 50 | 12,474 | 45,658 | 1,781 | 231 | 47,670 |
| Derecognitions | -13,502 | -600 | -108 | -14,210 | -11,990 | -581 | -69 | -12,640 | -32,519 | -1,694 | -227 | -34,440 |
| Financial assets with actual loan losses |
- | - | -1 | -1 | -0 | - | -8 | -8 | -0 | -0 | -18 | -18 |
| Closing balance | 95,694 | 4,839 | 895 101,428 | 86,232 | 4,451 | 705 | 91,389 | 96,963 | 5,474 | 825 103,263 | ||
| Corporate Market | ||||||||||||
| Opening balance | 51,327 | 8,533 | 1,259 | 61,119 | 47,621 | 6,460 | 1,410 | 55,491 | 47,621 | 6,460 | 1,410 | 55,491 |
| Transfer to stage 1 | 332 | -323 | -9 | - | 846 | -834 | -12 | - | 1,207 | -1,199 | -8 | - |
| Transfer to stage 2 | -1,132 | 1,137 | -5 | - | -684 | 760 | -76 | - | -3,639 | 3,655 | -17 | - |
| Transfer to stage 3 | -10 | -54 | 64 | - | -16 | -41 | 57 | - | -101 | -80 | 180 | - |
| Net increase/decrease amount existing loans |
-97 | -61 | -4 | -162 | 119 | -68 | 1 | 52 | -1,103 | -692 | -23 | -1,818 |
| New loans | 6,668 | 1,367 | 188 | 8,223 | 5,242 | 41 | 50 | 5,333 | 19,159 | 1,339 | 368 | 20,866 |
| Derecognitions | -5,137 | -1,530 | -421 | -7,088 | -3,431 | -211 | -66 | -3,708 | -11,811 | -949 | -354 | -13,114 |
| Financial assets with actual loan losses |
0 | 0 | -3 | -3 | 0 | 0 | -4 | -4 | -7 | -2 | -297 | -306 |
| Balance at 31 December |
51,952 | 9,068 | 1,069 | 62,089 | 49,696 | 6,108 | 1,359 | 57,163 | 51,327 | 8,533 | 1,259 | 61,119 |
| Closing balance | ||||||||||||
| Fixed interest loans at FV |
5,809 | 5,809 | 4,629 | 4,629 | 5,480 | 5,480 | ||||||
| Total gross loans at the end of the period |
153,455 | 13,907 | 1,964 169,326 140,557 | 10,559 | 2,065 153,181 153,770 | 14,007 | 2,085 169,862 |
| Parent Bank | Group | |||||
|---|---|---|---|---|---|---|
| 31 Dec 2023 | 31 Mar 2023 | 31 Mar 2024 (NOKm) | 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 | |
| 2,460 | 2,747 | 3,129 Agriculture and forestry | 3,129 | 2,747 | 2,460 | |
| 1,588 | 1,464 | 1,352 Fisheries and hunting | 1,352 | 1,464 | 1,588 | |
| 1,157 | 774 | 1,076 Sea farming industries | 1,076 | 774 | 1,157 | |
| 2,671 | 2,880 | 2,392 Manufacturing | 2,392 | 2,880 | 2,671 | |
| 5,251 | 4,952 | 4,551 Construction, power and water supply | 4,551 | 4,952 | 5,251 | |
| 5,996 | 4,976 | 5,033 Retail trade, hotels and restaurants | 5,033 | 4,976 | 5,996 | |
| 1,132 | 1,265 | 1,348 Maritime sector | 1,348 | 1,265 | 1,132 | |
| 5,867 | 5,810 | 6,196 Property management | 6,111 | 5,738 | 5,787 | |
| 13,413 | 13,225 | 12,334 Business services | 12,334 | 13,225 | 13,413 | |
| 11,164 | 9,912 | 11,895 Transport and other services provision | 11,428 | 9,417 | 10,698 | |
| 19,437 | 23,301 | 20,866 Public administration | 20,866 | 23,301 | 19,437 | |
| 5,452 | 3,952 | 6,215 Other sectors | 6,176 | 3,846 | 5,425 | |
| 75,588 | 75,259 | 76,386 Total | 75,795 | 74,586 | 75,015 | |
| 57,874 | 48,943 | 58,600 Wage earners | 58,600 | 48,943 | 57,874 | |
| 133,462 | 124,202 | 134,986 Total deposits | 134,395 | 123,529 | 132,888 |
Note 9 - Distribution of customer deposits by sector/industry
Note 10 - Net interest income
| Parent bank | Group | |||||
|---|---|---|---|---|---|---|
| Jan - Mar | Jan - Mar | |||||
| 2023 | 2023 | 2024 (NOKm) | 2024 | 2023 | 2023 | |
| Interest income | ||||||
| 887 | 183 | 236 Interest income from loans to and claims on central banks and credit institutions (amortised cost) |
91 | 77 | 380 | |
| 4,716 | 981 | 1,361 Interest income from loans to and claims on customers (amortised cost) |
1,638 | 1,207 | 5,701 | |
| 3,616 | 725 | 1,096 Interest income from loans to and claims on customers (FVOCI) |
1,096 | 725 | 3,616 | |
| 165 | 33 | 49 Interest income from loans to and claims on customers (FVPL) |
49 | 33 | 165 | |
| 1,382 | 312 | 368 Interest income from money market instruments, bonds and other fixed income securities |
372 | 319 | 1,377 | |
| - | - | - Other interest income | 6 | 6 | 24 | |
| 10,766 | 2,234 | 3,111 Total interest income | 3,253 | 2,367 | 11,263 | |
| Interest expense | ||||||
| 559 | 126 | 168 Interest expenses on liabilities to credit institutions | 168 | 126 | 559 | |
| 3,780 | 696 | 1,166 Interest expenses relating to deposits from and liabilities to customers |
1,159 | 689 | 3,748 | |
| 2,056 | 462 | 542 Interest expenses related to the issuance of securities | 542 | 462 | 2,057 | |
| 129 | 24 | 40 Interest expenses on subordinated debt | 42 | 25 | 132 | |
| 9 2 |
3 Other interest expenses | 12 | 9 | 45 | ||
| 90 | 21 | 23 Guarantee fund levy | 23 | 21 | 90 | |
| 6,623 | 1,331 | 1,943 Total interest expense | 1,947 | 1,332 | 6,631 | |
| 4,143 | 903 | 1,168 Net interest income | 1,306 | 1,035 | 4,632 |
Note 11 - Net commission income and other income
| Parent bank | Group | ||||||
|---|---|---|---|---|---|---|---|
| Jan - Mar | Jan - Mar | ||||||
| 2023 | 2023 | 2024 (NOKm) | 2024 | 2023 | 2023 | ||
| Commission income | |||||||
| 68 | 18 | 17 Guarantee commission | 17 | 18 | 68 | ||
| - | - | - Broker commission | 71 | 64 | 265 | ||
| 47 | 11 | 15 Portfolio commission, savings products | 15 | 11 | 47 | ||
| 155 | 57 | 59 Commission from SpareBank 1 Boligkreditt | 59 | 57 | 155 | ||
| 15 | 3 | 4 Commission from SpareBank 1 Næringskreditt | 4 | 3 | 15 | ||
| 496 | 113 | 123 Payment transmission services | 123 | 112 | 493 | ||
| 253 | 61 | 63 Commission from insurance services | 63 | 61 | 253 | ||
| 83 | 18 | 17 Other commission income | 15 | 16 | 74 | ||
| 1,117 | 281 | 298 Total commission income | 367 | 341 | 1,370 | ||
| Commission expenses | |||||||
| 102 | 23 | 28 Payment transmission services | 28 | 24 | 102 | ||
| 12 | 3 | 4 Other commission expenses | 23 | 26 | 96 | ||
| 114 | 26 | 32 Total commission expenses | 51 | 50 | 199 | ||
| Other operating income | |||||||
| 38 | 9 | 11 Operating income real property | 9 | 10 | 41 | ||
| - | - | - Property administration and sale of property | 44 | 42 | 166 | ||
| - | - | - Accountant's fees | 200 | 188 | 661 | ||
| 34 | 7 | 1 Other operating income | 4 | 10 | 45 | ||
| 73 | 16 | 12 Total other operating income | 257 | 249 | 913 | ||
| 1,076 | 271 | 279 Total net commission income and other operating income |
572 | 541 | 2,084 |
Note 12 - Operating expenses
| Parent bank | Group | |||||
|---|---|---|---|---|---|---|
| Jan - Mar | Jan - Mar | |||||
| 2023 | 2023 | 2024 (NOKm) | 2024 | 2023 | 2023 | |
| 304 | 92 | 91 IT costs | 110 | 106 | 355 | |
| 11 | 3 | 3 Postage and transport of valuables | 4 | 4 | 14 | |
| 59 | 17 | 20 Marketing | 26 | 23 | 86 | |
| 77 | 23 | 30 Ordinary depreciation | 41 | 29 | 117 | |
| 46 | 13 | 13 Operating expenses, real properties | 13 | 16 | 55 | |
| 188 | 43 | 60 Purchased services | 74 | 53 | 217 | |
| 156 | 90 | 21 Other operating expense *) | 32 | 99 | 195 | |
| 841 | 280 | 237 Total other operating expenses | 299 | 330 | 1,038 |
*) In the first quarter of 2024, a cost reduction of NOK 30 million has been made under other operating expense after payment of an insurance settlement in connection with the embezzlement case. In the first quarter of 2023, an operational loss of NOK 51 million, relating to the same case, has been expensed under other operating expense.
Note 13 - Net return on financial investments
| Parent Bank | Group | ||||||
|---|---|---|---|---|---|---|---|
| Jan - Mar | Jan - Mar | ||||||
| 2023 | 2023 | 2024 (NOKm) | 2024 | 2023 | 2023 | ||
| Valued at fair value through profit/loss | |||||||
| 17 | -25 | -88 Value change in interest rate instruments | -94 | -33 | 17 | ||
| Value change in derivatives/hedging | |||||||
| 2 | 9 | 6 | Net value change in hedged bonds and derivatives* | 6 | 9 | 2 | |
| 5 | -24 | 11 | Net value change in hedged fixed rate loans and derivatives |
11 | -24 | 5 | |
| -118 | -57 | 96 | Other derivatives | 96 | -57 | -118 | |
| Income from equity instruments | |||||||
| - | - | - | Income from owner interests | 194 | 125 | 297 | |
| 693 | - | 109 | Dividend from owner instruments | - | - | - | |
| 32 | 5 | 1 | Value change and gain/loss on owner instruments | 1 | 2 | -5 | |
| 18 | 4 | 6 | Dividend from equity instruments | 3 | 2 | 26 | |
| 421 | 11 | 11 | Value change and gain/loss on equity instruments | 41 | -18 | 469 | |
| 1,069 | -77 | 153 Total net income from financial assets and liabilities at fair value through profit/(loss) |
258 | 5 | 692 | ||
| Valued at amortised cost | |||||||
| -2 | -1 | 0 Value change in interest rate instruments held to maturity | 0 | -1 | -2 | ||
| -2 | -1 | 0 Total net income from financial assets and liabilities at amortised cost |
0 | -1 | -2 | ||
| 108 | 24 | 22 Total net gain from currency trading | 22 | 24 | 108 | ||
| 1,175 | -54 | 175 Total net return on financial investments | 281 | 28 | 799 | ||
| * Fair value hedging | |||||||
| 896 | 185 | -185 Changes in fair value on hedging instrument | -185 | 185 | 896 | ||
| -894 | -176 | 191 Changes in fair value on hedging item | 191 | -176 | -894 | ||
| 2 | 9 | 6 Net Gain or Loss from hedge accounting | 6 | 9 | 2 |
Note 14 - Other assets
| Parent Bank | Group | |||||
|---|---|---|---|---|---|---|
| 31 Dec 2023 | 31 Mar 2023 | 31 Mar 2024 (NOKm) | 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 | |
| - | - | - Deferred tax asset | 6 | 5 | 6 | |
| 167 | 114 | 161 Fixed assets | 268 | 227 | 276 | |
| 251 | 275 | 331 Right to use assets | 481 | 410 | 390 | |
| 136 | 143 | 159 Earned income not yet received | 215 | 192 | 153 | |
| 66 | 1,780 | 278 Accounts receivable, securities | 278 | 1.780 | 66 | |
| 221 | 240 | 221 Pension assets | 221 | 240 | 221 | |
| 479 | 694 | 531 Other assets | 826 | 953 | 737 | |
| 1,320 | 3,246 | 1,682 Total other assets | 2,295 | 3,808 | 1,848 |
Note 15 - Other liabilities
| Parent Bank | Group | |||||
|---|---|---|---|---|---|---|
| 31 Dec | 31 Mar | 31 Mar | 31 Mar | 31 Mar | 31 Dec | |
| 2023 | 2023 | 2024 (NOKm) | 2024 | 2023 | 2023 | |
| 158 | 72 | 158 Deferred tax | 216 | 127 | 216 | |
| 813 | 527 | 757 Payable tax | 812 | 602 | 900 | |
| 22 | 13 | 22 Capital tax | 22 | 13 | 22 | |
| 137 | 263 | 681 Accrued expenses and received, non-accrued income |
1.001 | 573 | 439 | |
| 533 | 619 | 619 Provision for accrued expenses and commitments | 619 | 619 | 533 | |
| 52 | 83 | 55 Losses on guarantees and unutilised credits | 55 | 83 | 52 | |
| 9 | 6 | 9 Pension liabilities | 9 | 6 | 9 | |
| 260 | 285 | 338 Lease liabilities | 491 | 421 | 403 | |
| 9 | 109 | 4 Drawing debt | 4 | 109 | 9 | |
| 132 | 81 | 99 Creditors | 189 | 159 | 191 | |
| -15 | 972 | 288 Debt from securities | 288 | 972 | -15 | |
| 148 | 1,139 | 1,984 Other liabilities | 2,064 | 1,195 | 243 | |
| 2,259 | 4,168 | 5,013 Total other liabilites | 5,771 | 4,878 | 3,002 |
Note 16 - Debt created by issue of securities and subordinated debt
| Group | |||||
|---|---|---|---|---|---|
| Fallen due/ | Other | ||||
| Change in securities debt (NOKm) | 01 Jan 2024 | Issued | Redeemed | changes | 31 Mar 2024 |
| Bond debt, nominal value | 34,767 | - | 2,955 | 713 | 32,526 |
| Senior non preferred, nominal value | 12,344 | 357 | - | -5 | 12,696 |
| Value adjustments | -1,588 | - | - | -248 | -1,836 |
| Accrued interest | 306 | - | - | 77 | 386 |
| Total | 45,830 | 357 | 2,955 | 537 | 43,772 |
| Change in subordinated debt and hybrid equity | Fallen due/ | Other | |||
|---|---|---|---|---|---|
| (NOKm) | 01 Jan 2024 | Issued | Redeemed | changes | 31 Mar 2024 |
| Ordinary subordinated loan capital, nominal value | 2,226 | - | -500 | 2 | 2,728 |
| Hybrid equity, nominal value | - | - | - | - | - |
| Value adjustments | - | - | - | - | - |
| Accrued interest | 21 | - | - | 3 | 24 |
| Total | 2,247 | - | -500 | 5 | 2,752 |
Note 17 - Measurement of fair value of financial instruments
Financial instruments at fair value are classified at various levels.
Level 1: Valuation based on quoted prices in an active market
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: Valuation based on observable market data
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.
Level 3: Valuation based on other than observable data
If valuation data are not available for level 1 and 2, valuation methods are applied that are based on non-observable information.
The following table presents the Group's assets and liabilities measured at fair value at 31 March 2024:
| Assets (NOKm) | Level 1 | Level 2 | Level 3 | Total |
|---|---|---|---|---|
| Financial assets at fair value through profit/loss | ||||
| - Derivatives | - | 7,260 | - | 7,260 |
| - Bonds and money market certificates | 4,104 | 31,976 | - | 36,080 |
| - Equity instruments | 385 | 110 | 660 | 1,156 |
| - Fixed interest loans | - | 101 | 5,808 | 5,909 |
| Financial assets through other comprehensive income | ||||
| - Loans at fair value through other comprehensive income | - | - | 90,820 | 90,820 |
| Total assets | 4,490 | 39,447 | 97,288 | 141,225 |
| Liabilities | Level 1 | Level 2 | Level 3 | Total |
| Financial liabilities through profit/loss | ||||
| - Derivatives | - | 7,084 | - | 7,084 |
| Total liabilities | - | 7,084 | - | 7,084 |
The following table presents the Group's assets and liabilities measured at fair value at 31 March 2023:
| Assets (NOKm) | Level 1 | Level 2 | Level 3 | Total |
|---|---|---|---|---|
| Financial assets at fair value through profit/loss | ||||
| - Derivatives | - | 7,073 | - | 7,073 |
| - Bonds and money market certificates | 4,576 | 39,754 | - | 44,330 |
| - Equity instruments | 158 | 120 | 548 | 826 |
| - Fixed interest loans | - | 78 | 4,628 | 4,706 |
| Financial assets through other comprehensive income | ||||
| - Loans at fair value through other comprehensive income | - | - | 80,843 | 80,843 |
| Total assets | 4,734 | 47,025 | 86,019 | 137,777 |
| Liabilities | Level 1 | Level 2 | Level 3 | Total |
| Financial liabilities through profit/loss | ||||
| - Derivatives | - | 7,792 | - | 7,792 |
| Total liabilities | - | 7,792 | - | 7,792 |
The following table presents the Group's assets and liabilities measured at fair value at 31 December 2023:
| Assets (NOKm) | Level 1 | Level 2 | Level 3 | Total |
|---|---|---|---|---|
| Financial assets at fair value through profit/loss | ||||
| - Derivatives | - | 6,659 | - | 6,659 |
| - Bonds and money market certificates | 2,879 | 31,284 | - | 34,163 |
| - Equity instruments | 363 | 152 | 622 | 1,137 |
| - Fixed interest loans | - | 102 | 5,480 | 5,582 |
| Financial assets through other comprehensive income | ||||
| - Loans at fair value through other comprehensive income | - | - | 92,263 | 92,263 |
| Total assets | 3,242 | 38,197 | 98,365 | 139,804 |
| Liabilities | Level 1 | Level 2 | Level 3 | Total |
| Financial liabilities through profit/loss | ||||
| - Derivatives | - | 6,989 | - | 6,989 |
| Total liabilities | - | 6,989 | - | 6,989 |
The following table presents the changes in the instruments classified in level 3 as at 31 March 2024:
| Equity instruments through profit |
Fixed interest | Loans at fair value through |
||
|---|---|---|---|---|
| (NOKm) | /loss | loans | OCI | Total |
| Opening balance 1 January | 622 | 5,480 | 92,263 | 98,365 |
| Investment in the period | 5 | 612 | 11,544 | 12,161 |
| Disposals in the period | -1 | -257 | -12,978 | -13,236 |
| Expected credit loss | - | - | -9 | -9 |
| Gain or loss on financial instruments | 34 | -26 | 0 | 8 |
| Closing balance 31 March 2024 | 660 | 5,808 | 90,820 | 97,288 |
The following table presents the changes in the instruments classified in level 3 as at 31 March 2023:
| Equity | ||||
|---|---|---|---|---|
| (NOKm) | instruments through profit /loss |
Fixed interest loans |
Loans at fair value through OCI |
Total |
| Opening balance 1 January | 570 | 4,630 | 81,901 | 87,101 |
| Investment in the period | 4 | 211 | 10,292 | 10,506 |
| Disposals in the period | -3 | -209 | -11,356 | -11,568 |
| Expected credit loss | - | - | 1 | 1 |
| Gain or loss on financial instruments | -24 | -4 | 5 | -22 |
| Closing balance 31 March 2023 | 548 | 4,628 | 80,843 | 86,019 |
The following table presents the changes in the instruments classified in level 3 as at 31 December 2023:
| (NOKm) | Equity instruments through profit /loss |
Fixed interest loans |
Loans at fair value through OCI |
Total |
|---|---|---|---|---|
| Opening balance 1 January | 570 | 4,630 | 81,901 | 87,101 |
| Investment in period | 38 | 1,814 | 40,578 | 42,430 |
| Disposals in the period | -25 | -977 | -30,210 | -31,212 |
| Expected credit loss | - | - | 2 | 2 |
| Gain or loss on financial instruments | 38 | 14 | -7 | 45 |
| Closing balance 31 December | 622 | 5,480 | 92,263 | 98,366 |
Valuation method
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:
Fixed interest loans to customers (level 3)
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.
Loans at fair value through other comprehensive income (level 3)
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 2 million.
Short-term paper and bonds (level 2 and 3)
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.
Equity instruments (level 3)
Shares that are classified to level 3 include essentially investments in unquoted shares. Among other a total of NOK 560 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 (level 2)
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.
Sensitivity analyses, level 3 as at 31 March 2024:
| (NOKm) | Book value | Effect from change in reasonable possible alternative assumtions |
|
|---|---|---|---|
| Fixed interest loans | 5,808 | -15 | |
| Equity instruments through profit/loss * | 660 | - | |
| Loans at fair value through other comprehensive income | 90,820 | -2 |
* As described above, the information to perform alternative calculations are not available
Note 18 - Liquidity risk
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 first quarter 2024 was 3.3 years. The overall LCR at the same point was 160 per cent and the average overall LCR in the first quarter was 176 per cent. The LCR in Norwegian kroner and euro at quarter-end was 160 and 392 per cent respectively.
Note 19 - Earnings per EC
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.
| Jan - Mar | |||
|---|---|---|---|
| (NOKm) | 2024 | 2023 | 2023 |
| Adjusted Net Profit to allocate between ECC owners and Savings Bank | |||
| Reserve 1) | 1,011 | 711 | 3,489 |
| Allocated to ECC Owners 2) | 675 | 455 | 2,331 |
| Issues Equity Capital Certificates adjusted for own certificates | 144,166,778 | 129,357,116 | 138,106,331 |
| Earnings per Equity Capital Certificate | 4.68 | 3.52 | 16.88 |
| Jan - Mar | |||
| 1) Adjusted Net Profit | 2024 | 2023 | 2023 |
| Net Profit for the group | 1,084 | 778 | 3,688 |
| adjusted for non-controlling interests share of net profit | -25 | -33 | -74 |
| Adjusted for Tier 1 capital holders share of net profit | -48 | -34 | -125 |
| Adjusted Net Profit | 1,011 | 711 | 3,489 |
| 2) Equity capital certificate ratio (parent bank) (NOKm) | 31 Mar 2024 | 31 Mar 2023 | 31 Dec 2023 |
| ECC capital | 2,883 | 2,597 | 2,884 |
| Dividend equalisation reserve | 8,472 | 7,877 | 8,482 |
| Premium reserve | 2,422 | 895 | 2,422 |
| Unrealised gains reserve | 71 | 45 | 71 |
| Other equity capital | 0 | - | 0 |
| A. The equity capital certificate owners' capital | 13,848 | 11,413 | 13,859 |
| Ownerless capital | 6,865 | 6,408 | 6,865 |
| Unrealised gains reserve | 35 | 25 | 35 |
| Other equity capital | 0 | - | 0 |
| B. The saving bank reserve | 6,901 | 6,433 | 6,900 |
| To be disbursed from gift fund | - | - | 860 |
| Dividend declared | - | - | 1,730 |
| Equity ex. profit | 20,748 | 17,846 | 23,350 |
| Equity capital certificate ratio A/(A+B) | 66.8 % | 64.0 % | 66.8 % |
| Equity capital certificate ratio for distribution | 66.8 % | 64.0 % | 66.8 % |
Results from quarterly accounts
| Group (NOKm) | 1Q | 4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q |
|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | 2023 | 2023 | 2023 | 2022 | 2022 | 2022 | 2022 | |
| Interest income effective interest method | 3,253 | 3,264 | 2,994 | 2,638 | 2,367 | 2,136 | 1,605 | 1,346 | 1,227 |
| Interest expenses | 1,947 | 1,951 | 1,803 | 1,544 | 1,332 | 1,175 | 791 | 543 | 468 |
| Net interest | 1,306 | 1,312 | 1,191 | 1,094 | 1,035 | 961 | 814 | 803 | 759 |
| Commission income | 367 | 325 | 336 | 367 | 341 | 340 | 370 | 378 | 358 |
| Commission expenses | 51 | 40 | 58 | 51 | 50 | 45 | 52 | 46 | 42 |
| Other operating income | 257 | 213 | 206 | 245 | 249 | 178 | 173 | 223 | 206 |
| Commission income and other income | 572 | 498 | 484 | 561 | 541 | 473 | 491 | 555 | 522 |
| Dividends | 3 | -10 | 16 | 18 | 2 | 19 | 8 | 4 | 2 |
| Income from investment in related companies | 194 | 90 | -2 | 85 | 125 | 195 | 108 | 77 | 62 |
| Net return on financial investments | 84 | 491 | 83 | 1 | -99 | -52 | -30 | -123 | 111 |
| Net return on financial investments | 281 | 571 | 97 | 103 | 28 | 163 | 86 | -43 | 175 |
| Total income | 2,159 | 2,382 | 1,772 | 1,757 | 1,604 | 1,597 | 1,391 | 1,316 | 1,456 |
| Staff costs | 482 | 476 | 435 | 383 | 398 | 333 | 348 | 350 | 375 |
| Other operating expenses | 299 | 390 | 306 | 300 | 330 | 314 | 235 | 235 | 255 |
| Total operating expenses | 782 | 866 | 741 | 683 | 728 | 646 | 583 | 585 | 629 |
| Result before losses | 1,377 | 1,517 | 1,032 | 1,074 | 875 | 951 | 808 | 731 | 827 |
| Loss on loans, guarantees etc. | 24 | 20 | 35 | 29 | -71 | 19 | 22 | -48 | -0 |
| Result before tax | 1,353 | 1,496 | 996 | 1,045 | 946 | 932 | 785 | 779 | 827 |
| Tax charge | 273 | 262 | 278 | 159 | 206 | 210 | 179 | 164 | 166 |
| Result investment held for sale, after tax | 3 | 12 | 22 | 37 | 38 | 46 | 10 | 87 | 37 |
| Net profit | 1,084 | 1,247 | 740 | 923 | 778 | 768 | 617 | 702 | 698 |
Key figures from quarterly accounts
| Group (NOKm) | 1Q | 4Q | 3Q | 2Q | 1Q | 4Q | 3Q | 2Q | 1Q |
|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | 2023 | 2023 | 2023 | 2022 | 2022 | 2022 | 2022 | |
| Profitability | |||||||||
| Return on equity per quarter 1) | 16.0% | 18.3% | 11.1% | 15.1% | 13.0% | 13.1% | 10.9% | 12.9% | 12.6% |
| Cost-income ratio 1) | 42 % | 48 % | 44 % | 41 % | 46 % | 45 % | 45 % | 43 % | 49 % |
| Balance sheet figures | |||||||||
| Gross loans to customers | 169,326 169,862 168,940 166,819 153,181 152,629 150,247 148,681 147,023 | ||||||||
| Gross loans incl. SB1 Boligkreditt and SB1 Næringskreditt |
238,270 236,329 234,316 232,100 213,967 211,244 208,900 205,504 199,965 | ||||||||
| Deposit from customers | 134,395 132,888 138,230 140,164 123,529 122,010 120,558 123,812 114,053 | ||||||||
| Total assets | 235,721 232,717 243,472 248,806 228,207 223,312 218,918 217,458 207,027 | ||||||||
| Quarterly average total assets | 234,219 238,095 246,139 238,507 225,759 221,115 218,188 212,243 202,936 | ||||||||
| Growth in loans incl. SB1 Boligkreditt and SB1 Næringskredtt last 12 months 1) |
0.8 % | 0.9 % | 1.0 % | 8.5 % | 1.3 % | 1.1 % | 1.7 % | 2.8 % | 2.4 % |
| Growth in deposits last 12 months | 1.1 % | -3.9 % | -1.4 % | 13.5 % | 1.2 % | 1.2 % | -2.6 % | 8.6 % | 2.5 % |
| Losses in % of gross loans incl. SB1 Boligkreditt and SB1 Næringskreditt |
|||||||||
| Impairment losses ratio 1) | 0.04 % | 0.03 % | 0.06 % | 0.05 % | -0.13 % | 0.04 % | 0.04 % | -0.09 % | 0.00 % |
| Stage 3 as a percentage of gross loans 1) | 0.82 % | 0.88 % | 0.98 % | 0.99 % | 0.96 % | 0.97 % | 1.02 % | 1.08 % | 1.62 % |
| Solidity | |||||||||
| Common equity Tier 1 capital ratio | 18.5 % | 18.8 % | 19.7 % | 19.1 % | 18.2 % | 18.9 % | 19.2 % | 18.8 % | 18.3 % |
| Tier 1 capital ratio | 20.4 % | 20.8 % | 21.3 % | 21.0 % | 20.1 % | 20.9 % | 20.8 % | 20.4 % | 19.8 % |
| Capital ratio | 23.1 % | 23.0 % | 23.7 % | 23.5 % | 22.2 % | 23.1 % | 23.0 % | 22.7 % | 21.9 % |
| Tier 1 capital | 24,073 | 23,793 | 24,283 | 24,192 | 21,985 | 21,835 | 21,252 | 20,547 | 19,797 |
| Total eligible capital | 27,250 | 26,399 | 26,950 | 27,106 | 24,298 | 24,147 | 23,546 | 22,910 | 21,839 |
| Liquidity Coverage Ratio (LCR) | 160 % | 175 % | 173 % | 188 % | 194 % | 239 % | 180 % | 204 % | 155 % |
| Leverage Ratio | 7.1 % | 7.2 % | 7.3 % | 7.2 % | 6.9 % | 7.1 % | 7.3 % | 6.9 % | 7.0 % |
| Key figures ECC | |||||||||
| ECC share price at end of period (NOK) | 137.80 | 141.80 | 137.20 | 141.00 | 123.60 | 127.40 | 111.40 | 115.80 | 141.20 |
| Number of certificates issued, millions 1) | 144.13 | 144.20 | 143.82 | 143.80 | 129.43 | 129.29 | 129.29 | 129.31 | 129.39 |
| Booked equity capital per ECC (NOK) 1) | 113.24 | 120.48 | 116.39 | 112.81 | 105.63 | 109.86 | 107.19 | 102.91 | 99.55 |
| Profit per ECC, majority (NOK) 1) | 4.68 | 5.62 | 3.28 | 4.21 | 3.51 | 3.53 | 2.89 | 3.20 | 3.20 |
| Price-Earnings Ratio (annualised) 1) | 7.36 | 6.31 | 10.47 | 8.38 | 8.79 | 9.02 | 9.62 | 9.06 | 11.05 |
| Price-Book Value Ratio 1) | 1.22 | 1.18 | 1.18 | 1.25 | 1.17 | 1.16 | 1.04 | 1.13 | 1.42 |
1) Defined as alternative performance measures, see attachment to the quarterly report.
Equity capital certificates
Stock price compared with OSEBX and OSEEX
1 April 2022 to 31 March 2024
OSEBX = Oslo Stock Exchange Benchmark Index (rebased) OSEEX = Oslo Stock Exchange ECC Index (rebased)
Trading statistics
1 March 2023 to 31 March 2024
Total number of ECs traded (1000)
| 20 largest ECC holders | No. Of ECCs | Holding |
|---|---|---|
| Sparebankstiftinga Søre Sunnmøre | 12,971,224 | 8.99 % |
| Sparebankstiftelsen SMN | 5,463,847 | 3.79 % |
| KLP | 4,222,118 | 2.93 % |
| Pareto Aksje Norge VPF | 3,816,663 | 2.65 % |
| State Street Bank and Trust Comp | 3,089,392 | 2.14 % |
| Pareto Invest Norge AS | 2,938,362 | 2.04 % |
| VPF Eika Egenkapitalbevis | 2,920,422 | 2.03 % |
| J. P. Morgan Chase Bank, N.A., London | 2,769,580 | 1.92 % |
| The Northern Trust Comp | 2,429,700 | 1.68 % |
| VPF Alfred Berg Gamba | 2,361,207 | 1.64 % |
| Danske Invest Norske Aksjer Institusjon II. | 2,311,670 | 1.60 % |
| VPF Holberg Norge | 2,150,000 | 1.49 % |
| State Street Bank and Trust Comp | 2,122,323 | 1.47 % |
| Forsvarets personellservice | 2,014,446 | 1.40 % |
| J. P. Morgan SE | 1,942,630 | 1.35 % |
| VPF Odin Norge | 1,866,474 | 1.29 % |
| VPF Nordea Norge | 1,847,635 | 1.28 % |
| RBC Investor Services Trust | 1,786,943 | 1.24 % |
| Spesialfondet Borea Utbytte | 1,420,064 | 0.98 % |
| MP Pensjon PK | 1,352,771 | 0.94 % |
| The 20 largest ECC holders in total | 61,797,471 | 42.85 % |
| Others | 82,418,119 | 57.15 % |
| Total issued ECCs | 144,215,590 | 100.00 % |
Dividend policy
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
Report on Review of Interim Financial Information
Introduction
We have reviewed the accompanying consolidated balance sheet of SpareBank 1 SMN as at 31 March 2024, and the related consolidated income statement, the statement of comprehensive income, the statement of changes in equity and the cash flow statement for the three-month period then ended, and a summary of significant accounting policies and other explanatory notes. Management is responsible for the preparation of this interim financial information that gives a true and fair view in accordance with IAS 34 Interim Financial Reporting. Our responsibility is to express a conclusion on this interim financial information based on our review.
Scope of 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.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the accompanying consolidated interim financial information does not, in all material respects, give a true and fair view of the financial position of the entity as at 31 March 2024, and of its financial performance and its cash flows for the three-month period then ended in accordance with IAS 34 Interim Financial Reporting.
Trondheim, 7 May 2024 PricewaterhouseCoopers AS
Rune Kenneth S. Lædre State Authorised Public Accountant
Note: This translation from Norwegian has been prepared for information purposes only.