SPAREBANK 1 SMN (MING) Q1 2025 earnings summary

Executive summary

• Achieved a return on equity of 14.0% in Q1 2025, down from 16.0% in Q1 2024, with net profit after tax of NOK 1,004 million.

• Pre-tax profit for Q1 2025 was NOK 1,269 million, compared to NOK 1,353 million in Q1 2024.

• Broad-based growth in net interest income, reduced costs, and seasonally strong subsidiary results contributed to solid performance.

• Lending growth was 0.2% and deposit growth 5.2% year-over-year, with retail lending up 0.7% and corporate lending down 0.9% in the quarter.

• Diversified lending book with high credit quality and robust dividend capacity, positioning for further growth.

Financial highlights

• Net interest income was NOK 1,321 million, down NOK 15 million year-over-year and NOK 51 million sequentially.

• Net commission and other income increased to NOK 648 million from NOK 579 million.

• Total operating expenses decreased by NOK 42 million sequentially, with cost growth in the bank at 2.0% year-over-year (adjusted).

• Losses on loans and guarantees were NOK 21 million, with an annualised loss ratio of 0.03%.

• Operating income increased by NOK 54 million year-over-year to NOK 1,969 million.

Outlook and guidance

• Well-capitalised and prepared to navigate significant macroeconomic and regulatory uncertainties.

• Targeting a return on equity of 13% and maintaining a cost/income ratio below 40% in the parent bank.

• The long-term CET1 target is 16.3%, with the current ratio well above regulatory requirements.

• Focused on digitalisation, efficiency, and leveraging AI for customer service and internal processes.

• The board expects 2025 to be another good year despite increased macroeconomic uncertainty.