MELHUS SPAREBANK (MELG) Q4 2024 earnings summary

Executive summary

• Net income after tax for Q4 2024 was NOK 139.5 million, up from NOK 135.4 million in 2023, despite a one-time apartment sale in 2023 boosting last year's result.

• Return on equity was 9.9% for Q4 2024, matching the adjusted figure from 2023.

• Loan growth including Eika Boligkreditt (EBK) was 2.74% over 12 months, down from 5.99% in 2023.

• Cost/income ratio remained stable at 42.1%.

• Consolidated CET1 ratio was 18.3%, well above the regulatory requirement of 15.3%.

Financial highlights

• Net interest income for Q4 2024 was NOK 66.2 million, up slightly from NOK 65.9 million in Q4 2023.

• Total operating income for 2024 was NOK 259.6 million, up from NOK 249.1 million in 2023.

• Provisions for loan losses were NOK 15.7 million for 2024, down from NOK 22.7 million in 2023.

• Total assets under management including EBK reached NOK 13.87 billion.

• Dividend proposed at NOK 13.50 per equity certificate, totaling NOK 37.5 million.

Outlook and guidance

• Expectation of cautious interest rate cuts starting in 2025, with improved household finances anticipated.

• Bank aims for cost/income ratio below 45%, loan growth of 6–8%, and ROE of 10% in 2025.

• New capital adequacy rules will increase growth capacity above market average.

• Strong competition in mortgage market expected to persist.