Norion Bank Ab · OMXSTO:NORION
Norion Bank Ab — Q1 2025 Earnings Presentation
24 slides from Norion Bank Ab's earnings presentation, Apr 24, 2025
Slide 1: Q1 2025 Quarterly report presentation
Q1 2025 Quarterly report presentation 1
Slide 2: Summary of Q1 2025
Summary of Q1 2025 Y-o-Y comparison Loan book Total income C/I Partial use of consultants to SEK 47,513m SEK 1,022m 27.5% broaden origination +5% +10% -0.2 p.p. capacity Operating profit Return on equity1 CET1 / Total capital Balder to distribute SEK 525m 17.8% ratio shares in Norion +26% +2.0 p.p.
Slide 3: Corporate
Corporate Loan book (SEKm) Industry split1 • Continued good 10,738 11,582 11,221 Other 9,992 17% sentiment 8,733 Wholesale & Retail 25% Construction • Volume decline vs. 4% Q4 driven by FX and Financial services & Investment companies Business Services seasonality in 15% 22% factoring Manufacturing
Slide 4: Real Estate (1/2)
Real Estate (1/2) • Selective approach Loan book (SEKm) Industry split1 Other • Volume decline vs. 22,086 22,453 22,495 23,073 21,060 12% Warehouse Q4 driven by FX, 5% changes in Hotel 8% Office 33% accounting Retail methodology and 12% expected amortizations Residential 31% Q1 24 Q2 24 Q3 24 Q4 24
Slide 5: Real Estate (2/2)
Real Estate (2/2) • Norion Bank acting as a leading Portfolio overview complement to the Share of senior loans 61% client’s primary bank Share of junior loans 39% • Low share of the client’s total debt Average LTV – Senior loans 59% financing Average LTV – Junior loans 77% • Professional clients • S
Slide 6: Consumer
Consumer • Good progress from Loan book (SEKm) Geographic split1 investments in 11,733 11,996 12,152 12,019 Finland Norway 1% 11,135 2% proprietary distribution model Sweden • Reduced risk profile 97% in new lending • Increased profitability Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 Average customer prioritized
Slide 7: Acquisition of DNB Sweden's credit card portfolio completed
Acquisition of DNB Sweden’s credit card portfolio completed • Closing completed in April 2025 Business after completion Access to exclusive partner deals • Strengthens Norion 24,000 credit cards increase to ~95,000 Bank’s position on the Swedish Acquired credit volume SEK ~650 million consumer finan
Slide 8: Payments
Payments • Strong growth in Transaction volumes (SEKm) Geographic split1 Denmark transaction volumes 5,413 Norway 16% 1% with 4,112 4,408 4,456 3,490 outperformance of the underlying Sweden 50% market Finland 34% • Several new Q1 24 Q2 24 Q3 24 Q4 24 Q1 25 merchants signed during the year with Loan
Slide 9: Loan book volume change explained vs. Q4 2024
Loan book volume change explained vs. Q4 2024 • Significant FX volatility with SEK strengthening vs. key FX -1,062 MSEK currencies, primarily EUR • Limited P&L impact One-off change in accounting methodology related to Accounting • -534 MSEK accrued but unpaid interest income methodology • No P&L im
Slide 10: Income increase driven by payments received from Stage 3 exposures
Income increase driven by payments received from Stage 3 exposures • SEK 140m in interest income recognition Total income (SEKm) NIM – Quarter1 due to payments 1,022 from Stage 3 933 947 922 7.3% 7.3% 7.6% 895 exposures treated as 6.7% 6.7% cash accounting • Accrued interest income from loans since
Slide 11: Positive impact from interest income recognition of payments received from Stage 3 volumes
Positive impact from interest income recognition of payments received from Stage 3 volumes • Reported NII and NIM positively NIM and impact from cash accounting affected by cash 7.6% 7.3% accounting principle -0.3% applied to Stage 3 volumes within Real Estate vs. previous periods Reported NIM Q1 25
Slide 12: Rate changes affecting both yield and funding costs
Rate changes affecting both yield and funding costs • IBOR rates have NIM, yield and funding costs1 continued to decline 8.09% 7.78% 7.88% 7.71% 7.59% • Yield increase driven 7.12% 7.35% 7.34% 7.29% 6.85% by income from 6.72% 6.73% 11.45% 11.47% Stage 3 volumes 10.00% 10.74% 10.77% 11.45% 10.88% 10.
Slide 13: Continued strengthening of LCR and NSFR during the quarter
Continued strengthening of LCR and NSFR during the quarter • Low liquidity risk with high historic Liquidity coverage ratio (LCR) Net stable funding ratio (NSFR) LCR and NSFR levels 470% 139% 143% 140% 141% 409% • Requirements 363% 397% 112% 121% exceeded under 320% 330% 103% updated SFSA interpreta
Slide 14: Further structural increase of liquidity position
Further structural increase of liquidity position Funding / loan book development • Regulatory liquidity 1.19 profile strengthened 1.11 partly by a structural 1.03 1.01 1.00 increase of liquidity 0.97 position • Increased excess liquidity currently has a negative impact on NII Q4 23 Q1 24 Q2 24 Q3 2
Slide 15: Corporate
Corporate • Strong volume and income increase Y-o-Y Loan book (SEKm) and NIM1 Total income (SEKm) and margin1 11,582 226 • Volume 10,738 11,221 196 217 development vs. Q4 9,992 188 8,733 165 primarily driven by 8.0% 7.9% seasonality in 7.6% 7.3% 7.3% 7.2% 7.6% 7.8% 6.9% 7.0% factoring • Continued st
Slide 16: Real Estate
Real Estate • Income and margins positively affected by c. SEK 140m in Loan book (SEKm) and NIM1 Total income (SEKm) and margin1 interest income 22,086 22,453 22,495 23,073 21,060 416 recognition from 342 7.5% Stage 3 volumes 7.5% 268 274 263 treated as cash 6.3% accounting 6.2% 4.8% 4.8% 4.7% 4.7%
Slide 17: Consumer
Consumer Loan book (SEKm) and NIM1 Total income (SEKm) and margin1 • More cautious 12,152 256 11,733 11,996 12,019 volume 11,135 226 230 217 development partly 208 9.0% driven by consumer 8.4% sentiment 7.2% 7.5% 7.6% 7.6% 7.1% 7.2% 7.2% 6.7% • Margins prioritized over volume growth • New sales at l
Slide 18: Payments
Payments • Strong increase in transaction volumes Loan book (SEKm) and NIM1 Total income (SEKm) and margin1 • Seasonal decline in 3,018 127 134 123 121 123 loan book 2,694 2,712 2,744 2,782 • Income generally 9.0% 19.8% coming through 7.4% 8.1% 8.0% 8.0% 18.7% 17.8% with a time lag as 17.0% 17.0% ne
Slide 19: Stable underlying cost development given one-offs and seasonality in Q4
Stable underlying cost development given one-offs and seasonality in Q4 • Focus on Total expenses (SEKm) C/I ratio profitability and 303 32.8% efficiency 266 21 281 258 19 28.1% 247 27.7% 27.6% 27.5% 17 • Cost increase during 16 16 the last year driven 152 148 142 by variable costs, 138 137 inflatio
Slide 20: Continued prudent provisioning
• Improved payments patterns and credit Continued prudent provisioning quality in front book • Prudent provisioning Credit losses – Quarter1 maintained given macroeconomic outlook and 2.3% 2.3% 2.1% regulatory changes 1.9% 1.8% • Provisioning ratios remain solid – Stage 3 private customers (own port
Slide 21: Solid earnings and profitability level
• Operating profit at Solid earnings and profitability level all-time high level • SEK 140m in interest income recognition Operating profit (SEKm) and EPS (SEK) Return on equity – Quarter1 from Stage 3 525 17.8% exposures treated as 15.8% 15.8% cash accounting 417 416 393 383 14.4% 13.5% coming thro
Slide 22: Strong capital position
• CET1 ratio of 16.1% Strong capital position as of Q1 2025 • Total capital ratio of 17.2% as of Q1 2025 Capital adequacy ratios and requirements • Positive impact from 16.7% 16.9% 17.2% strong earnings, FX 16.1% 15.8% and underlying 13.3% volume change 10.9% • Negative impact 16.1% 15.8% 16.1% from
Slide 23: Summary and outlook
Summary and outlook Improved Stage 3 Macroeconomic Acquisition of DNB volumes and environment and rate Solid profitability Sweden’s credit card retroactive interest outlook portfolio completed income Strong balance sheet Intention to buy back Continued monitoring Selective approach and prudent share
Slide 24: Norion Bank
Norion Bank Group