30.4.2025 08:00:00 CEST | Føroya Banki | Interim report (Q1 and Q3)
Announcement no. 6/2025
"Today, we can present a satisfactory profit after tax of DKK 61m for the first quarter. The first three months of the year were characterised by increasing customer numbers and decent growth across deposits, lending and mortgage credit. Interest, fee and insurance activity incomes were a little above expectations due, in particular, to higher lending growth and a solid insurance result. Costs were in line with expectations, while impairment charge levels reflect the still sound creditworthiness of our customers. Our ongoing work to develop excellent digital solutions for our customers passed yet another milestone with the launch of a new chatbot designed to make being a customer of the Bank easier - and which is also the first chatbot that can understand and respond to customers' enquiries in Faroese. We have a positive outlook on the rest of the year, though with the proviso that we have not yet felt the full impact of the ongoing rate cuts or of the potential negative economic consequences of the current geopolitical unrest and the risk of an intensified trade war," says Turið F. Arge, CEO Føroya Banki.
Highlights from Føroya Banki's interim report for Q1 2025
| DKKm | Q1 2025 | Q1 2024 | Index | Q1 2025 | Q4 2024 | Index | Q3 2024 | Q2 2024 | Q1 2024 |
| Net interest income | 76 | 92 | 83 | 76 | 78 | 98 | 87 | 90 | 92 |
| Net fee and commission income | 20 | 19 | 102 | 20 | 19 | 103 | 18 | 17 | 19 |
| Net insurance income | 16 | 12 | 131 | 16 | 10 | 151 | 20 | 15 | 12 |
| Other operating income (less reclassification) | 13 | 11 | 117 | 13 | 9 | 138 | 10 | 10 | 11 |
| Operating income | 125 | 135 | 93 | 125 | 117 | 106 | 135 | 132 | 135 |
| Operating costs | -69 | -65 | 106 | -69 | -72 | 96 | -69 | -68 | -65 |
| Profit before impairment charges | 56 | 70 | 80 | 56 | 46 | 123 | 66 | 63 | 70 |
| Impairment charges, net | -5 | -23 | 22 | -5 | 11 | -45 | 6 | 7 | -23 |
| Operating profit | 51 | 47 | 107 | 51 | 57 | 89 | 72 | 70 | 47 |
| Non-recurring items | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||
| Profit before investment portfolio earnings and tax | 51 | 47 | 107 | 51 | 57 | 89 | 72 | 70 | 47 |
| Investment portfolio earnings | 25 | 23 | 109 | 25 | 31 | 81 | 48 | 35 | 23 |
| Profit before tax | 76 | 70 | 108 | 76 | 88 | 86 | 119 | 105 | 70 |
| Tax | 15 | 15 | 98 | 15 | 15 | 97 | 23 | 18 | 15 |
| Net profit | 61 | 55 | 111 | 61 | 72 | 84 | 96 | 87 | 55 |
| Loans and advances | 9.272 | 8.915 | 104 | 9.272 | 9.086 | 102 | 9.072 | 9.023 | 8.915 |
| Deposits and other debt | 10.306 | 8.930 | 115 | 10.306 | 10.007 | 103 | 9.359 | 9.180 | 8.930 |
| Mortgage credit | 2.906 | 2.621 | 111 | 2.906 | 2.741 | 106 | 2.579 | 2.585 | 2.621 |
| Equity | 1.788 | 1.824 | 98 | 1.788 | 2.076 | 86 | 2.004 | 1.909 | 1.824 |
| Total capital ratio, incl. MREL capital, % | 36,0 | 39,9 | 36,0 | 36,3 | 37,9 | 40,8 | 39,9 | ||
| CET 1 capital, % | 23,5 | 25,0 | 23,5 | 23,8 | 25,1 | 25,6 | 25,0 | ||
| ROE, % | 12,6 | 12,0 | 12,6 | 14,2 | 19,6 | 18,6 | 12,0 | ||
| ROE, excl. one-offs, % | 12,6 | 12,0 | 12,6 | 14,2 | 19,6 | 18,6 | 12,0 | ||
| Liquidity Coverage Ratio (LCR), % | 261,1 | 283,6 | 261,1 | 337,4 | 302,2 | 285,6 | 283,6 | ||
| Operating cost/income, % | 55 | 48 | 55 | 61 | 51 | 52 | 48 | ||
| Number of FTE, end of period | 204 | 209 | 98 | 204 | 207 | 98 | 206 | 209 | 209 |
Business developments
Overall, Q1 2025 was characterised by an increase in business activity, underpinned by lending growth of 2%, deposit growth of 3% and an increase in brokered mortgage credit of 6% compared with Q4 2024.
Capital ratios
The CET 1 capital ratio at 31 March 2025 was 23.5% compared with 23.8% at 31 December 2024. The total capital ratio including MREL was 36.0% at 31 March 2025 against 36.3% at 31 December 2024. The net profit of DKK 60.9m for Q1 2025 is not included in the capital ratios.
Guidance for 2025
The Bank reconfirms its guidance of a net profit for 2025 in the range DKK 210-240m. The guidance is subject to uncertainty and will, among other things, depend on economic developments, loan impairment charges and market value adjustments.
Føroya Banki has banking activities in Greenland and the Faroe Islands and insurance activities in the Faroe Islands. Founded in the Faroe Islands more than a century ago, the Group has total assets of DKK 14.8bn and 204 employees. The Bank is subject to the supervision of the Danish Financial Supervisory Authority and is listed on Nasdaq Copenhagen.
Further information is available in the Interim Report for Q1 2025 (published in English only).
Further information:
Rúna N. Rasmussen, Investor Relations, tel.: (+298) 230 478
