SPAREBANK 1 ØSTFOLD AKERSHUS (SOAG) Q2 2024 earnings summary

Executive summary

• Strong net interest income and solid banking operations in H1 2024, with market share gains in both corporate and retail segments.

• Net profit after tax for H1 2024 was NOK 276 million, up from NOK 263 million year-over-year, with a return on equity of 12.6%.

• Broker subsidiary gained market share despite challenging conditions.

• Loan losses remained low at NOK 3 million, down NOK 5 million year-over-year.

• Ongoing dialogue with the Financial Supervisory Authority regarding new Pillar 2 requirements.

Financial highlights

• Pre-tax profit for Q2 2024 was NOK 171 million, down from NOK 183 million in Q2 2023 and NOK 180 million in Q1 2024.

• Pre-tax profit for H1 2024 reached NOK 351 million, up from NOK 338 million in H1 2023.

• Net interest income including credit institutions reached NOK 407 million (1.94% of avg. assets), up from NOK 383 million (1.92%) year-over-year.

• Net commission and other operating income for H1 2024 totaled NOK 189 million, a 1% increase year-over-year.

• Total operating costs increased by NOK 8 million to NOK 262 million, mainly due to higher headcount.

Outlook and guidance

• Targeting ROE above 10% and CET1 ratio above 16%, both currently exceeded.

• Dividend payout up to 50% of parent bank profit.

• Competitive pressure and limited credit growth are expected to continue, keeping margins under pressure.

• Anticipated gain of NOK 53–58 million from Sparebanken Sogn og Fjordane's entry into SamSpar by January 2025.

• Awaiting new SREP assessment from the Financial Supervisory Authority, which may impact capital requirements.