SpareBank 1 SMN posted a profit of NOK 816m in the first nine months of 2012, an increase of NOK 71m over the same period last year. The Bank reinforced its position in both the retail and corporate market.
The interim accounts reflect a sound trend in the Bank's ordinary operations, growth in earnings, low losses on loans, a good return on financial assets and satisfactory growth in lending and deposits alike.
"We are pleased with the trend at SpareBank 1 SMN in the year's first nine months. Solid operations combined with sound and profitable growth and low losses enable the bank to continue to deliver a good performance," says SpareBank 1 SMN's Group CEO, Finn Haugan.
"SpareBank 1 SMN has raised its market share among households and businesses alike in Trøndelag and Møre and Romsdal. In order to further strengthen its position, the Bank has launched an improvement programme designed to improve customer experience, raise productivity and reduce relative operating costs", says Mr Haugan.
First nine months 2012 - highlights:
· Profit before tax: NOK 1,042m (946m in first nine months 2011)
· Profit after tax: NOK 816m (745m)
· Return on equity: 12.1% (12.6%)
· Growth in lending: 11.4% (7.7%)
· Growth in deposits: 10.5% (19.1%)
· Loan losses: NOK 42m (1m)
· Tier 1 capital adequacy: 10.6% (10.4%)
· Earnings per equity certificate: NOK 3.99 (4.41)
Low losses
The Bank shows low losses and low defaults, reflecting both the region's economic position and the Bank's portfolio quality. Net losses account for a mere 0.06 per cent of total lending. Provision for collectively assessed impairment write-downs has been raised by NOK 5m due to some uncertainty related to exposures in individual segments.
High customer-facing activity levels at the Bank and its subsidiaries Eiendomsmegler 1 Midt-Norge and SpareBank 1 SMN Regnskap, and increased outlays on developing the SpareBank 1 collaboration, have produced higher costs compared with the same period last year. The growth in costs is in keeping with the Group's plans.
Greater focus on capital
Growth in risk-weighted assets poses a challenge to the Bank's financial position. As of the third quarter 2012 the tier 1 capital ratio was 10.6%, whereas the Group's objective is 11%. The Board of Directors of SpareBank 1 SMN has a close focus on effective application of capital resources across the Group.
The Bank has liquidity reserves of NOK 21bn and thus has the funding needed for 18 months of ordinary operations without fresh external finance. The Bank can take a possible further tightening of banking sector access to money market funding in its stride. SpareBank 1 SMN has negligible international exposure in its ordinary business and limited direct exposure to securities markets.
Market position strengthened
Overall 12-month growth in lending to the retail market was 12,7% compared with general household credit growth of 7.1% as of end-August 2012, according to Statistics Norway. SpareBank 1 SMN shows strong growth throughout its market area. A total of 7.300 new retail customers have joined the Bank thus far in 2012.
SpareBank 1 SMN retains its strong position in the corporate market with 9.7% growth in lending over the last 12 months compared with general credit growth of 5.6%, according to Statistics Norway. The largest companies - EiendomsMegler 1 Midt-Norge, SpareBank 1 SMN Finans and SpareBank 1 SMN Regnskap - are strengthening their market position and profitability.
SpareBank 1 SMN's total assets came to NOK 138.5bn as of end-September 2012, including loans transferred to the part-owned SpareBank 1 Boligkreditt and SpareBank 1 Næringskreditt.
Sound finances regionally and nationally
"The situation with regard to the European economy remains demanding. Regionally there are still few indications that this will significantly weaken the position of business and industry in Trøndelag and Møre and Romsdal. This is also one of the key conclusions of Economic Barometer 2012 recently presented by the Bank. The Bank's Board of Directors expects 2012 to be another good year for SpareBank 1 SMN," says Finn Haugan.
Trondheim, 26 October 2012.
Contact persons at SpareBank 1 SMN:
Group CEO Finn Haugan on +47 900 41 002
Executive Vice President, Finance, Kjell Fordal on +47 905 41 672
Executive Vice President, Corporate Communications, Hans Tronstad on +47 941 78 322
About SpareBank 1 SMN
SpareBank 1 SMN is the region's leading financial services group. It leads the retail and corporate market, and is positioned in 43 localities across the region's municipalities with a total of 54 offices.
We aim to be the recommended bank for customers in Trøndelag and in Møre and Romsdal. Being a local, independent savings bank we feel a special responsibility for stimulating growth and prosperity in the region. We base our business on closeness to our customers, good accessibility, a full product range and comprehensive financial advisory services.
Our head office is in Trondheim. The Group employs about 1,200 staff and includes the following subsidiaries: SpareBank 1 SMN Finans, EiendomsMegler 1 Midt-Norge, Allegro Finans and SpareBank 1 SMN Regnskap. It is the largest shareholder in BN Bank with a 33% stake.
SpareBank 1 SMN is one of six owners of SpareBank 1 Gruppen. For further information, visit our website at www.smn.no.
This information is subject of the disclosure requirements acc. to §5-12 vphl (Norwegian Securities Trading Act)
