Voss Veksel- og Landmandsbank (VVL) Q3 2024 earnings summary

Executive summary

• Profit before losses for Q3 YTD reached NOK 91.6m, up NOK 20.3m from the same period in 2023, driven by strong core operations, loan growth, cost control, and increased other income.

• Net profit after tax was NOK 68.8m, compared to NOK 51.2m last year; total comprehensive income was NOK 64.9m versus NOK 51.0m.

• Return on equity (ROE) after tax (adjusted for hybrid capital) was 12.6%, up from 10.2% year-over-year.

Financial highlights

• Net interest and credit commission income for Q3 YTD was NOK 102.0m, up NOK 3.9m year-over-year, with a net interest margin of 2.15% (2.18%).

• Other operating income totaled NOK 40.6m, up NOK 12.9m, mainly from higher commission, dividends, and financial instrument gains.

• Operating expenses decreased to NOK 50.9m from NOK 54.4m, with personnel costs up NOK 2.6m but other costs down NOK 5.9m.

• Net loan loss reversals of NOK 0.1m, compared to NOK 3.9m in losses last year; extraordinary sector-based provisions of NOK 7.8m maintained due to macro uncertainty.

• Customer deposits at quarter-end were NOK 4,562m, up NOK 201m (+4.6%) year-over-year; deposit coverage ratio stable at 81.42%.

• Gross loans (including Eika Boligkreditt) reached NOK 6,323m, up NOK 336.5m (+5.6%) year-over-year.

Outlook and guidance

• The board expects continued satisfactory results, supported by strong core operations, quality growth, and cost reductions.

• Persistent high inflation and interest rates, along with geopolitical uncertainty, increase macroeconomic risk and delay expected rate cuts until well into 2025.

• Conservative risk profile in securities portfolio maintained, ensuring low risk of losses.