SKUE SPAREBANK (SKUE) Q1 2025 earnings summary

Executive summary

• Strong loan growth continued in Q1 2025, with increased competitiveness in both retail and corporate markets.

• Pre-tax profit reached NOK 91.9 million, up 26.3% year-over-year, influenced by the merger with Hjartdal and Gransherad Sparebank.

• Net profit after tax was NOK 68.6 million, with return on equity (excl. hybrid capital) at 8.9%, down from 9.8% last year.

• Announced intention to merge with Tinn Sparebank, aiming for further strategic growth.

Financial highlights

• Net interest income rose 29.7% year-over-year to NOK 133.9 million, but fell 5.4% sequentially due to fewer interest days.

• Net commission income increased 50% year-over-year to NOK 23.7 million.

• Negative value change on financial instruments of NOK -0.1 million, compared to NOK +2.5 million last year.

• Operating expenses increased by NOK 18.9 million year-over-year, partly due to merger effects; one-off merger costs of NOK 0.2 million.

• Net loan losses were NOK 0.3 million, with increased model-based provisions due to economic uncertainty.

Outlook and guidance

• The announced merger with Tinn Sparebank is expected to strengthen market access and growth potential in Telemark and Buskerud.

• The bank is well positioned to handle market challenges and increased regulatory requirements.

• Norges Bank is expected to lower the policy rate to 4% by year-end, with moderate economic growth and a slight rise in unemployment anticipated.