SKUE SPAREBANK (SKUE) Q4 2024 earnings summary

Executive summary

• Achieved strong loan and deposit growth in Q4 2024, maintaining high customer activity during the successful merger with Hjartdal and Gransherad Sparebank.

• Solid profitability with increased return on equity and robust capital position; return on equity (excl. hybrid capital) at 12.4%, up from 9.7% last year.

• Merger resulted in one-time costs and significant negative goodwill, positively impacting results.

• Proposed dividend for 2024 is NOK 32.52 per equity certificate, totaling NOK 74.6 million, with a 100% payout ratio.

• Set aside NOK 232.5 million to the bank's gift fund for future flexibility.

Financial highlights

• Result before tax: NOK 392.8m, up 47.1% year-over-year; net profit after tax: NOK 327.9m, up 58.7% year-over-year.

• Net interest income: NOK 472.0m, up 17.5% year-over-year; net interest margin 2.40%.

• Net commission income: NOK 78.0m, up 25.1% year-over-year.

• Operating expenses were NOK 152.3m, down NOK 52.6m year-over-year, aided by NOK 91.7m negative goodwill from the merger.

• Merger-related one-off costs totaled NOK 11.9m for the year.

Outlook and guidance

• Norwegian economic outlook for 2025 is positive, with expected interest rate cuts, falling inflation, and wage growth outpacing price increases.

• Expect continued cost related to technical merger in 2025, estimated at NOK 8m.

• High dividend payout ratio proposed at 100% for 2024.

• Focus on maintaining strong customer activity and capital flexibility post-merger.

• Bank is well-positioned for further growth and to meet regulatory requirements following the merger.