SPAREBANKEN ØST (SPOG) Q2 2025 earnings summary

Executive summary

• Achieved high ROE of 18.3% for Q2 2025, supported by a NOK 80.1 million gain from the Eksportfinans share sale and stable core banking operations.

• Maintained low credit risk, high capital adequacy, and robust leverage ratio, positioning among Norway's most solid banks.

• Net interest income remains high but is showing a declining trend compared to previous quarters.

• Loan volumes remained stable, while deposit volumes increased.

• Board reaffirmed dividend policy and long-term ROE target of 10%.

Financial highlights

• Net profit after tax: NOK 208.7 million in Q2 2025, up from NOK 133.5 million in Q2 2024.

• Net interest income for Q2 2025 was NOK 215 million, down from NOK 220 million in Q1 2025 and NOK 240 million in Q2 2023.

• Cost/income ratio improved to 25.6% in Q2 2025, down from 30.4% in Q1 2025.

• Loan losses remained very low at NOK 1.5 million, or 0.02% of net loans.

• Net other operating income: NOK 114.6 million, mainly from the Eksportfinans sale.

Outlook and guidance

• Expects loan growth to align with national credit growth over time.

• Anticipates continued pressure on lending margins due to high competition for mortgage customers.

• Deposit margins expected to decline further with lower money market rates and increased competition.

• Cost control remains strong, but rising wages and IT costs are expected to impact future expenses.

• Ambition to maintain minimum 10% ROE over time, focusing on sustainable growth, efficiency, and risk management.