Morrow Bank (MORROW) Company Presentation summary

Strategic overview and market position

• Operates as a scalable, digital-focused Nordic niche bank with a diversified loan portfolio across Norway, Sweden, and Finland, targeting a NOK ~600bn unsecured lending market.

• Demonstrates strong growth, with a 26% year-on-year increase in loan balances to NOK 15.4bn and a CET1 ratio of 16.8% as of Q1 2025, well above the regulatory requirement.

• Maintains a best-in-class cost/income ratio (24.4% in Q1 2025 excluding one-offs) and a highly scalable, efficient platform supporting continued profitability improvements.

• Management team and board bring extensive experience from Nordic and international banking and finance sectors.

• Granted a Swedish banking license in April 2025, with plans to redomicile and list on Nasdaq Stockholm by year-end, enhancing competitive positioning.

Financial performance and profitability

• Total income grew 16% year-on-year, driven by organic growth and acquisition of performing Swedish loan portfolios.

• Net interest margin remained stable at 8.8% in Q1 2025, with a net loan-deposit margin of 10.5%.

• Profit before tax increased 43% year-on-year to NOK 83.1m in Q1 2025; return on target equity (ROTE) improved to 10.7%.

• Loan loss ratio declined to 4.3% in Q1 2025, reflecting improved credit quality.

• Dividend policy focuses on distributing excess capital not allocated to growth, with NOK 0.4 per share paid for 2024.

Capital structure and contemplated Tier 1 issuance

• Plans to issue up to NOK 250m in perpetual, callable Additional Tier 1 (AT1) bonds to optimize capital structure and support continued growth.

• The AT1 bonds are perpetual, non-cumulative, and callable after five years, with interest payments cancellable at the issuer’s discretion.

• The issue aims to qualify as AT1 capital under regulatory requirements, with a CET1 trigger at 5.125%.

• Improved capital situation post-CRR3 implementation, with CET1 headroom of NOK 700m as of April 2025.