SpareBank 1 SMN : Good growth and lower losses

5/4/2018, 7:30 AM (Source: GlobeNewswire)

SpareBank 1 SMN recorded a net profit of NOK 466m in the first quarter of the current year, an increase of NOK 99m over the same period last year. The bank notes a large influx of new customers, both personal and corporate. 

The year's first three months at SpareBank 1 SMN feature strong ordinary banking operations, high growth in the number of customers and good sales in all product areas, lower losses and a good financial position. 

"We are well pleased with our performance in the first three months. Our strategy builds on a phygital approach to the market featuring effective interaction between digital solutions and skilled advisers at the bank. This is likely the most important reason for our strong growth", says Finn Haugan, Group CEO at SpareBank 1 SMN. 

"In addition, business and industry are faring well throughout our market area, and we see a positive trend for our clients in the offshore segment. This has resulted in lower losses", says Mr Haugan. 

Market position strengthened

The bank increased its lending to personal customers by 10.0 per cent to NOK 100.4bn in the twelve months to end-March. This also reflects solid customer growth with an increase of 1,900 personal customers in the year's first three months. The bank has thus strengthened its leading market position in Trøndelag and in Møre and Romsdal. 

Lending to corporate customers rose by 4.0 per cent to NOK 50.6bn. The growth stems mainly from small businesses with more than 300 new customers in the quarter, and is in keeping with the bank's plan. The volume of large exposures is being gradually reduced. 

In addition to high growth in lending, the bank is succeeding well with sales of other products such as savings products, accountancy services and insurance products. Where real estate agency is concerned we see an improvement for the rest of the year after a period of low activity. 

Net interest income rose by NOK 35m to NOK 568m compared with the same quarter last year. The increase is due to increased volumes both of residential mortgages and deposits. 

Lower losses

Losses are down by almost half to NOK 48m compared with the same quarter last year, and are at their lowest level since 2015. 

"Restructuring in the offshore segment has been completed this time round, and the outlook appears brighter as a result of a higher oil price. Even so we are allowing for the possibility of new challenges arising for that industry in some years' time. This explains the provision made for losses this quarter", says Finn Haugan. 

As communicated to Oslo Børs yesterday, SpareBank 1 SMN has corrected its CET1 capital adequacy ratio as at 31 December 2017 from 14.9 per cent to 14.6 per cent. The correction does not affect book equity or reported return on equity. The CET1 capital ratio is unchanged through the first quarter of 2018. 

The bank's target CET1 ratio of 15.0 per cent stands firm and the bank assumes and expects that this target will be attained by the end of the year. 

Optimism greater than at any time in the past six years

SpareBank 1 SMN's expectations barometer as of April 2018 shows that optimism among mid-Norway's business leaders is greater than at any time in the past six years. A total of 600 leaders have been asked to assess their business's prospects for the twelve months ahead. The responses are summarised in an indicator which shows business leaders' belief in the future based on employment, turnover and profitability. 

In Trøndelag and in Møre and Romsdal the indicator value has risen by five percentage points to 36 per cent since last autumn. Expectations as regards employment in particular have risen. 

Accounts for the first quarter of 2017 - key figures:

  • Pre-tax profit: NOK 596m (466m same period 2017)
  • Post-tax profit: NOK 466m (367m)
  • Return on equity: 11.2% (9.4%)
  • Growth in lending: 7.9% (8.1%)
  • Growth in deposits: 8.2% (9.9%)
  • Loan losses: NOK 48m (89m)
  • CET1 capital ratio: 14.6% (14.7%)
  • Earnings per EC: NOK 2.21 (1.74) 

 

Trondheim, 4 May 2018

Contact persons at SpareBank 1 SMN:

Executive Vice President, Finance, Kjell Fordal on +47 905 41 672

Executive Vice President, Corporate Communications, Hans Tronstad on +47 941 78 322

This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act. 

http://quarterlyreport.smn.no/2018/

 



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Source: SpareBank 1 SMN via Globenewswire

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