SpareBank 1 SMN recorded a post-tax profit of NOK 2,090m in 2018, which is an increase of NOK 262m from the previous year. The bank's board of directors recommend a dividend payout of NOK 5.10.
The directors' recommendation to supervisory board entails that 51 per cent of the net profit will be paid out to the investors and the community. An allocation of NOK 293m is proposed to the foundation Sparebankstiftelsen SMN and NOK 80m to non-profit causes in central Norway.
The 2018 accounts feature good banking operations, reduced loan losses, good sales across all product areas along with high growth and a large influx of new customers. 7,000 personal customers and 1,100 businesses chose SpareBank 1 SMN as their new main bank in 2018. In addition, gains were recorded in connection with the sale of the bank's head office in Trondheim and the merger between Vipps, BankAxept and BankID.
"2018 was another good year for SpareBank 1 SMN. We maintained high growth, particularly in the personal market, good sales in most product categories and a trend across all business lines matching our expectations", says CEO Finn Haugan at SpareBank 1 SMN.
Market position strengthened
The bank increased its lending to personal customers by 9.6 per cent to NOK 108.1bn over the previous twelve months, which is considerably higher than general market growth. Lending to corporate borrowers rose by 4.2 per cent to NOK 52.2bn, with most of the growth down to small businesses and agricultural enterprises. This is in keeping with the bank's plan for differentiated growth with the emphasis on small and medium-sized businesses.
Last month Finanstilsynet (Norway's FSA) approved the bank's acquisition of DeBank. SpareBank 1 SMN is increasing its focus on small and medium-sized businesses, and this acquisition will strengthen SpareBank 1 SMN's offering in the field of factoring, which is a rapidly growing market.
Net interest income grew by NOK 178m to NOK 2,403m compared with the same period of the previous year. The growth is mainly due to growth in lending, in particular residential mortgage lending.
Group costs increased by NOK 255m, largely owing to business acquisitions by SpareBank 1 Regnskapshuset SMN, capacity expansion at SpareBank 1 Markets and a greater focus on BN Bolig. Parent bank costs increased by NOK 53m, mainly due to investments in self-service solutions, a new adviser system and an increase in resources devoted to combating money laundering. However, efficiency gains by the bank have enabled lower staffing and higher productivity.
Lower losses
Losses are substantially reduced from the same period of the previous year, with a decline of NOK 78m to NOK 263m. The losses are largely related to oil-related activities.
"The decline in losses was as expected. The bank's other portfolio of loans shows almost zero non-performance and very small losses again in 2018. The bank's own economic barometer indicates prospects for the coming year that are the best we have observed since 2013. We believe the level of losses in 2019 will be stable or falling compared with the previous year", says Finn Haugan.
Accounts as at the fourth quarter 2018 - key figures:
Pre-tax profit: NOK 2,450m (2,279m per fourth quarter 2017)
Post-tax profit: NOK 2,090m (1,828m)
Return on equity: 12.2% (11.5%)
Growth in lending: 7.8% (8.2%)
Growth in deposits: 5.4% (13.9%)
Loan losses: NOK 263m (341m)
CET1 ratio: 14.6% (14.6%)
Earnings per equity certificate: NOK 9.97 (8.71)
Recommended dividend: NOK 5.10 (4.40)
Trondheim, 6 February 2019
Contact persons at SpareBank 1 SMN:
Executive Director, Finance, Kjell Fordal on +47 905 41 672
Head of Corporate Communications, Hans Tronstad on +47 941 78 322
This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.
Q4 18 Report (http://hugin.info/144/R/2233704/878748.pdf)
Supplementary-Information-Q4-2018 (http://hugin.info/144/R/2233704/878747.pdf)
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: SpareBank 1 SMN via Globenewswire
