Sparebank 1 Ostlandet · OSL:SPOL
Sparebank 1 Ostlandet — Q1 2025 Earnings Presentation
51 slides from Sparebank 1 Ostlandet's earnings presentation, May 8, 2025
Slide 1: Quarterly presentation First quarter 2025
1Q Quarterly presentation First quarter 2025
Slide 2: 1Q: Solid banking operations
1Q: Solid banking operations Return on equity (%) • Return on equity of 14.1 %. The first full quarter as a merged bank. Overall, a solid result with good income growth, moderate impairments, and somewhat lower cost growth. • Increased net interest income from the same period last year, also adjuste
Slide 3: Financial targets
Financial targets > 13 % > 50 % 16.1 % Profitability Dividends Solidity Achievements year-to-date 14.1 % 62 % 17.1 % 3
Slide 4: Global turmoil, but regional signs of improvement
Global turmoil, but regional signs of improvement Trade war and financial market turmoil could have a negative impact, but activity in Eastern Norway seems to be recovering after challenging years. Number of bankruptcies and unemployment rate have risen, but to normal levels. Number of bankruptcies,
Slide 5: Still high activity levels in the housing market
Still high activity levels in the housing market Very high activity in the housing market, especially early in the quarter. Household demand for loans has risen. Relatively high price growth. Housing market appears to be in balance, with more momentum in Oslo than elsewhere. Existing home sales (no.
Slide 6: Retail market: Unusually strong first quarter
Retail market: Unusually strong first quarter Proforma excl. margins Significant increase in mortgage applications. Organization is well positioned to handle the demand. Bank is gaining market share. Many rate inquiries on loans provides good opportunity to advise customers more broadly. Loan volume
Slide 7: Still strong development in commission income
Still strong development in commission income Significant growth in fund and insurance commissions, the result of a powerful combination of Norway's best mobile bank, a national campaign for fund savings, and competent advisors within the bank, focused on collaboration. Commission income, MNOK per q
Slide 8: Physically present, leading on customer service
Physically present, leading on customer service New office in Drammen will open on 12 May. Initiative in Drammen has yielded excellent results so far, similar to Økern. Strengthening the customer service team has meant the bank is leading in customer service within banking. Illustration by Vitreo 8
Slide 9: Corporate market: Strong competition
Corporate market: Strong competition Proforma excl. margins Low market growth and high competition. Positive development in loans to renewable energy industries continues. Large single deposits drive much of the deposit growth. Lower lending margins due to income on problem loans in Q4. Loan volume
Slide 10: Several dimensions when increasing profitability
Several dimensions when increasing profitability > 13 % Cost focus and internal efficiency Customer focus Good ALM and increased income
Slide 11: Investing for the future
Investing for the future Bank is investing significantly to simplify operations, redesign customer journeys, and modernize the organization. Investments will lead to high costs in the coming year but lay the foundation for a more profitable bank in the future. • Toten merger: A merger to model. The
Slide 12: Bank takes a wide-reaching social responsibility
Bank takes a wide-reaching social responsibility Sustainable local communities are central to the strategy. Bank contributes through customer dividends, gifts, scholarships, and sponsorships. The foundations, as the largest owners, distribute large funds from their ownership. Paid customer dividends
Slide 13: 1Q Financial accounts
1Q Financial accounts First quarter 2025 13
Slide 14: Income statement
Income statement Proforma Chg. in operating profit after tax (NOK mill.), from previous quarter Chg. in operating profit after tax (NOK mill.), from last year * Net interest income includes commission fees from covered bond companies. 14
Slide 15: Net interest income
Net interest income Proforma Good underlying development. Change from Q4-24 affected by interest income from problem engagements in 4Q (30 MNOK), new income model in covered bond companies in 1Q25 (10 MNOK), and two fewer interest days (≈ 26 MNOK). Net interest income incl. commissions from covered
Slide 16: Commission income
Commission income Proforma Net commissions and other income (NOK million) n s n n an n * Excluding commission income from the covered bond companies. 16
Slide 17: Profits in subsidiaries
Profits in subsidiaries Proforma Profits after tax in subsidiaries (NOK million) n a a s s a s * Financial accounts for 2024 include Siffer Norge AS as subsidiary. 17
Slide 18: Profits in joint ventures
Profits in joint ventures Profits after tax in joint ventures (NOK million) s s a n a a s n s n n s 18
Slide 19: Net income from financial assets and liabilities
Net income from financial assets and liabilities Proforma Net income from finance (NOK million) n nan a ass s an a s 19
Slide 20: Operating expenses
Operating expenses Proforma Operating expenses (NOK million) n a 20
Slide 21: Operating expenses
Operating expenses Changes in operating expenses (NOK million), from last year Quarterly cost income ratios, excl. financial items Proforma 21
Slide 22: Loan loss provisions
Loan loss provisions Proforma Quarterly loan loss provisions an ss s ns n an ss s ns n 22
Slide 23: Exposures per stage and credit loss provision ratio in stage 3
Exposures per stage and credit loss provision ratio in stage 3 Merger with Totens contributed in isolation to an increase in gross loans in stage 3 loans of just above NOK 650 mill. Exposure by stages (% of gross loans)* Loans in Stage 3 (NOK mill.) * Excluding loans transferred to covered bond comp
Slide 24: A solid loan portfolio
A solid loan portfolio Bank closely follows up payment problems, but far fewer customers than expected have problems. Share of retail customers with interest-only mortgage, %* Mortgages to debt collection (volume)* Use of corporate credit facilities (parent bank)* LTV commercial real estate* * Based
Slide 25: Capital levels
Capital levels Well above regulatory requirements. Common equity Tier 1 capital ratio 25
Slide 26: Expected effects of new capital adequacy regulation
Expected effects of new capital adequacy regulation The effects will occur at different times. CRR-3 came into effect on 1 April this year. The new risk weight floor will take effect on 1 July. Estimated effects on CET-1 of changes in capital adequacy regulations, based on balance sheet at 4Q24 ESTI
Slide 27: 1Q: Solid banking operations
1Q: Solid banking operations Return on equity (%) • Return on equity of 14.1 %. The first full quarter as a merged bank. Overall, a solid result with good income growth, moderate impairments, and somewhat lower cost growth. • Increased net interest income from the same period last year, also adjuste
Slide 28: Why invest in SPOL?
Why invest in SPOL? UNCOMPLICATED \/, Uncomplicated bank | [ | — BRAND — O Strong and distinct brand with low credit risk with high customer satisfaction SOLID Solid bank with significant growth / \ capacity ~~) SUSTAINABILITY Recognised and clear driver of sustainable transition PROFITABLE High ear
Slide 29: Contact details
Contact details Klara-Lise Aasen CEO klara-lise.aasen@sb1ostlandet.no Geir-Egil Bolstad CFO +47 918 82 071 geir-egil.bolstad@sb1ostlandet.no Bjørn-Erik R. Orskaug Head of Investor Relations +47 922 39 185 bjorn-erik.orskaug@sb1ostlandet.no investor@sb1ostlandet.no 29
Slide 30: Disclaimer
Disclaimer This presentation contains forward- ’ events and potential financial performance. Although SpareBank 1 Østlandet believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Ac
Slide 31: Appendix
Appendix 31
Slide 32: Green lending
Green lending Green share of lending is important to reach our net zero emissions objective.* Green loans per 31 March 2025, MNOK Share of green lending, % Residential mortgages Commercial real estate = 18,8 % (Green ratio) * Green loans are defined on page 122 in 2024 Annual report. 32
Slide 33: Good feedback on our work on CSR
Good feedback on our work on CSR 33
Slide 34: Headcount
Headcount Full-time equivalents in parent bank and subsidiaries * Includes Siffer Norge AS with subsidiaries from 1Q-2024 34
Slide 35: Group volume growth and margin development
Group volume growth and margin development Proforma excl. margins Loan volume and growth (NOK bill. and %)* Deposit volume and growth (NOK bill. and %) Margins, parent bank (%)** 4 * Includes loans transferred to the covered bond companies. ** Based on allocation of customer loans between retail and
Slide 36: Well diversified loan portfolio
Well diversified loan portfolio Lending to customers per sector (in %) Corporate market 28.5 % / 66,186 Retail market 71.5 % / 166,312 36
Slide 37: The Group's lending by geography
The Group’s lending by geography Lending to customers per county (share in %/NOK million) Change last 12 months (%) 37
Slide 38: Mortgage loans by geography
Mortgage loans by geography Retail lending by county (share in %/NOK million) Change last 12 months (%) 38
Slide 39: Corporate market lending by geography
Corporate market lending by geography Corporate lending by county (share in %/NOK million) Change last 12 months (%) 39
Slide 40: Rate sensitive volume
Rate sensitive volume Loans and deposits, NOK bill. Securities, NOK bill.* * Covered bonds refer to loans transferred to covered bond companies. 40
Slide 41: Rate fixings of funding and security holdings
Rate fixings of funding and security holdings Net rate fixings per month, share of quarter** NIBOR and commission rate SB1 Boligkreditt, % * Includes rate fixings on liquidity portfolio, debt securities issued on own balance, and interest rate/cross currency basis swaps. 41
Slide 42: Retail: Indicators of underlying credit quality
Retail: Indicators of underlying credit quality Retail customers with interest-only mortgage* Mortgages to debt collection (volume)* Arrears retail market, NOK mill.** 4 * Based on numbers for parent bank excl. Toten. ** Does not include loans transferred to SpareBank 1 Boligkreditt. 42
Slide 43: Retail: Mortgage collateral
Retail: Mortgage collateral Share of LTV by exposure – retail mortgages* Share of lending according to LTV - retail mortgages* * Including loans transferred to SpareBank 1 Boligkreditt. 43
Slide 44: Stable low LTVs in new mortgage approvals
Stable low LTVs in new mortgage approvals Share of new mortgage approvals and average LTV per period and county (Inland county divided b/w old Hedmark and Oppland counties) Oslo Akershus Hedmark Oppland Other Based on numbers for parent bank excl. Toten portfolio. 44
Slide 45: Corporate: Indicators of underlying credit quality
Corporate: Indicators of underlying credit quality Use of corporate credit facilities (parent bank)* Corp. arrears below 90 days (NOK mill.)* * Based on numbers for parent bank excl. Toten portfolio, with exposures of at least NOK 10 mill. 45
Slide 46: CRE: Attractive, diversified portfolio
CRE: Attractive, diversified portfolio 96 % of tenants have contracts that are 100 % indexed (to CPI). * Rental space attractivity Geographical distribution of rental space LTV for CRE portfolio 4 Share of rental space according to type Share of rental space at different indexation 46 * Based on num
Slide 47: CRE: Solid collateral
CRE: Solid collateral Loan portfolio is well positioned for higher yields in the commercial real estate market. Share of LTV by exposure – CRE* Share of lending according to LTV – CRE* * Based on numbers for parent bank excl. Toten portfolio, with exposures of at least NOK 10 mill. 47
Slide 48: Projects: Low activity for building projects
Projects: Low activity for building projects Required pre-sales normally 60 %, depending for example on equity, experience and complexity. Loans to real estate projects, building and construction, NOK bill.* Draw on construction loans, volume-weighted, share in %, * * Based on numbers for parent ban
Slide 49: Profit allocation for 2024
Profit allocation for 2024 In line with dividend policy, for owners and society (through primary capital) ILLUSTRATION Gifts and donations Profit after controlling interest The foundations NOK 3,206 mill. Totens Sparebank- Sparebank- stiftelsen stiftelse Hedmark Owners Primary capital NOK 121 mill.
Slide 50: SPOL
SPOL Price development (dividend adjusted), index = 100 pr 31 Mar-23 Turnover and SPOL price, monthly 1) SpareBank 1 Østlandet was listed on 13 June 2017. 2) APMs are defined in the quarterly report and the factbook. 3) Profit after tax for controlling interests x Equity capital certificate ratio*/
Slide 51: Creating together
Creating together Proficient Near Engaged We have worked for more than 175 years for people and businesses to succeed Our work continues
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