Sparebanken Møre posted a profit after tax of NOK 152
million in the third quarter of 2016, compared with
NOK 114 million in the same quarter last year. The
Bank has also increased its core Tier 1 capital ratio
to 14.9 %.
The return on equity was 12.1 %, compared with 9.6 %
for the corresponding quarter last year. The Bank's
total assets now amount to NOK 61.8 billion.
"We are continuing to build the Number 1 Bank in and
for Møre og Romsdal through good growth, good cost
efficiency and low level of losses," says the chief
executive of Sparebanken Møre, Olav Arne Fiskerstrand.
Increased Core Tier 1 capital
At the end of the third quarter, Sparebanken Møre's
core Tier 1 capital ratio was 14.9 %, compared with
13.3 % at the same time last year. This is well above
the Bank's minimum target of 13.0 %.
"We are very pleased that we have strengthened our
core Tier 1 capital significantly in recent years and
that we are well above the regulatory requirements.
The Bank benefits from strong financial solidity,
which was also confirmed by Moody's in August. The
rating agency stated that we will retain our good A2
rating, while also confirming its earlier assessment
that the rating outlook for the Bank is stable," says
Fiskerstrand.
Strong deposit growth
The Bank has registered high deposit growth in the
last year. Deposits from customers rose by 10.5 %,
compared with 3.5 % last year.
Overall, lending grew by 0.6 % with an increase of 6.2
% for retail customers and a decrease of 9.8 % for
corporate customers. At the end of the third quarter,
the retail market accounted for 70.1 % of the Group's
total lending portfolio.
"We are constantly gaining new customers in the retail
market, which reflects the Bank's strong position in
our market area. Growth in corporate lending has
decreased, in part as a consequence of declining
economic growth, the uneven playing field for
Norwegian and foreign banks, and the Bank's ambition
to increase its core capital ratio," says
Fiskerstrand.
Strong cost control
He stresses that the lasting low interest rates,
fierce competition for banking customers, an uncertain
macro-economic picture, and changed customer behaviour
set high standards regarding sound and efficient
banking operations.
Although net interest income decreased slightly during
the period, total income has increased from NOK 316
million last year to NOK 352 million this year. The
improvement is partly attributable to capital gains
from the bond portfolio. Costs are at about the same
level as last year and ended at 42.3 % in relation to
income at the end of the quarter.
"Cost efficiency has been highly prioritized in
Sparebanken Møre for many years. This is in turn
reflected in our results. We have worked thoroughly to
reduce losses and defaults. At the end of the third
quarter, net problem loans amounted to 0.30 % of gross
lending," says Fiskerstrand.
Losses on lending and guarantees amounted to NOK 5
million in the third quarter.
Sharing expertise
Fiskerstrand highlights the importance and necessity
of good credit work and having the right expertise in
all parts of the Bank. He also emphasizes the fact
that expertise should be shared with others. The Bank
was recently nominated for the Finansstafetten
['Financial Relay'] award for teaching personal
economics in schools.
Last school year, around 50 authorised advisers from
Sparebanken Møre visited more than 100 classrooms
contributing to 2 600 lower secondary school pupils`
knowledge about various economic topics. This amounts
to around 81 % of 9th graders in the county.
"Teaching personal economics is something we give a
high priority to and view as an important social
responsibility. The Bank's advisers hold valuable
expertise requested by schools - and needed by
teenagers. We know that payment behaviour that are
established at a young age are often followed through
into adulthood. We also know that a lack of knowledge
increases the risk of making poor and expensive
economic choices. This is precisely why it is
important to introduce the right attitudes and give
them the right information as early as possible," says
Olav Arne Fiskerstrand.
Key figures for Q3 2016
* Net interest income: NOK 278 million/1.82 %
(NOK 283 million/1.93 %)
* Profit before losses: NOK 204 million
(NOK 170 million)
* Profit after tax: NOK 152 million (NOK 114 million)
* Return on equity: 12.1 % (9.6 %)
* Cost income ratio: 42.3 % (46.4 %)
* Core Tier 1 capital ratio: 14.9 % (13.3 %)
* Lending growth in the last 12 months: 0.6 % (8.3 %)
* Deposit growth in the last 12 months: 10.5 % (3.5 %)
* Earnings per equity certificate as at Q3: NOK 22.95
(NOK 18.80)
Comparable figures for Q3 2015 in brackets.
This information is subject to the disclosure
requirements pursuant to section 5-12 of the Norwegian
Securities Trading Act.
Contact
* Olav Arne Fiskerstrand, CEO, Mobile: +47 900 18 299
* Runar Sandanger, EVP, Mobile: +47 950 43 660
* Tone S. Gjerdsbakk, Chief Information Officer,
Mobile: +47 990 44 346