NORION BANK AB January-March 2024
Interim report
January-March 2024
First quarter of 2024
(compared to the first quarter of 2023)
- The loan portfolio amounted to SEK 45,199m (41,699)
- Total income amounted to SEK 933m (882)
- The C/I ratio amounted to 27.7% (26.0)
- The credit loss level amounted to 2.3% (2.6)
- Operating profit amounted to SEK 417m (385)
- Net profit amounted to SEK 329m (305) and earnings per share 1) amounted to SEK 1.53 (1.42)
- Return on equity amounted to 15.8% (17.4)
- The CET1 ratio amounted to 16.1% (14.6) and the total capital ratio amounted to 16.1% (15.7)
Significant events during the period
On 28 March 2024, Norion Bank AB redeemed the AT1 bond of SEK 500 million that was issued in the first quarter of 2019. The Tier 1 ratio and total capital ratio have consequently decreased. The bank maintains good buffers in relation to the regulatory requirements after the redemption.
Significant events after the period
No significant events have occured after the end of the period.
- See pages 4-5
Photo: Anna Roström
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Norion Bank AB (publ) 556597-0513
Highlights first quarter of 2024 (compared to the first quarter of 2023)
45,199 | +8% | 933 | +6% |
Loan portfolio (SEKm) | Total income (SEKm) | ||
27.7% | +1.7 | 329 | +8% |
C/I ratio | percentage points | Net profit (SEKm) | |
15.8% | -1.6 | 16.1% | +1.4 |
Return on equity | percentage points | CET1 ratio | percentage points |
Loan portfolio (SEKm) and NIM (%)
41,699 | 42,106 | 44,139 | 45,470 | 45,199 |
7.8% | 7.9% | 7.4% | 7.7% | 7.3% |
Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 |
1) Earnings per share before and after dilution
EPS 1) (SEK) and adjusted RoE (%)
1.60 | 1.49 | 1.51 | 1.53 | |
1.42 | ||||
17.4% | 18.7% | |||
16.6% | 16.3% | 15.8% | ||
Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 |
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Interim report January - March 2024
This is Norion Bank
Norion Bank Group is a business-oriented Nordic financing bank. The Group's brands - Norion Bank, Walley and Collector - offer customized financing solutions that meet distinct needs in three customer segments: medium-sized corporates and real estate companies, merchants, and private individuals. As a specialist in financing solutions, Norion Bank Group is a leading complement to traditional large banks, with a vision of being the leading Nordic financing bank in its chosen segments.
Norion Bank offers corporate and real estate loans, as well as factoring for medium-sized corporates and real estate companies. The Walley brand offers flexible payment and checkout solutions to merchants and private individuals. The Collector brand offers personal loans and credit cards to private customers, as well as savings accounts to private individuals and companies. Norion Bank Group (formerly Collector Bank) was founded in 1999 and has offices in Gothenburg, Stockholm, Helsingborg, Oslo and Helsinki. Business is conducted through Norion Bank AB (public), which is listed on Nasdaq Stockholm.
Key ratios Group
Q1 | Q4 | Q1 | |||
SEKm | 2024 | 2023 | ∆ | 2023 | ∆ |
Income statement | |||||
Net interest income | 832 | 864 | -4% | 809 | 3% |
Total income | 933 | 934 | 0% | 882 | 6% |
Net profit | 329 | 326 | 1% | 305 | 8% |
Earnings per share before dilution, SEK | 1.53 | 1.51 | 1% | 1.42 | 8% |
Earnings per share after dilution, SEK | 1.53 | 1.51 | 1% | 1.42 | 8% |
Balance sheet | |||||
Loans to the public | 45,199 | 45,470 | -1% | 41,699 | 8% |
Deposits and borrowings from the public | 45,234 | 42,663 | 6% | 36,442 | 24% |
Debt securities in issue | 1,249 | 1,248 | 0% | 3,243 | -62% |
Subordinated liabilities | - | - | - | - | - |
Total equity (shareholders of Norion Bank AB) | 8,116 | 7,803 | 4% | 6,860 | 18% |
Key ratios1) | |||||
Net interest margin (NIM) - Period 2) | 7.3% | 7.7% | 7.8% | ||
Net interest margin (NIM) - LTM 2) | 7.6% | 7.6% | 7.6% | ||
Credit loss level - Period 2) | 2.3% | 2.4% | 2.6% | ||
Credit loss level - LTM 2) | 2.5% | 2.5% | 2.5% | ||
C/I ratio - Period 2) | 27.7% | 27.1% | 26.0% | ||
C/I ratio - LTM 2) | 26.0% | 25.6% | 25.7% | ||
Return on equity (RoE) - Period 2) | 15.8% | 16.3% | 17.4% | ||
Return on equity (RoE) - LTM 2) | 16.8% | 17.2% | 18.2% | ||
CET1 ratio 3) | 16.1% | 15.9% | 14.6% | ||
Tier 1 ratio 3) | 16.1% | 17.0% | 15.7% | ||
Total capital ratio 3) | 16.1% | 17.0% | 15.7% | ||
Average number of full-time employees | 366 | 357 | 3% | 328 | 12% |
Adjusted key ratios 1) | |||||
Net interest margin (NIM) - Period 2) | 7.3% | 7.7% | 7.8% | ||
Net interest margin (NIM) - LTM 2) | 7.6% | 7.6% | 7.6% | ||
Credit loss level - Period 2) | 2.3% | 2.4% | 2.6% | ||
Credit loss level - LTM 2) | 2.5% | 2.5% | 2.5% | ||
C/I ratio - Period 2) | 27.7% | 27.1% | 26.0% | ||
C/I ratio - LTM 2) | 26.0% | 25.6% | 25.7% | ||
Return on equity (RoE) - Period 2) | 15.8% | 16.3% | 17.4% | ||
Return on equity (RoE) - LTM 2) | 16.8% | 17.2% | 18.1% | ||
- See Definitions, pages 22-23, and norionbank.se/en-se/investor-relations-en/financial-information/key-financials for more information about key ratios
- Key ratios that have not been prepared in accordance with IFRS but are deemed to facilitate the analysis of Norion Bank's development. See Definitions, pages 22-23
- Key ratios according to capital adequacy rules (CRR). See note 12, pages 44-46
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Norion Bank AB (publ) 556597-0513
Key ratios Group, cont.
Full year | |
SEKm | 2023 |
Income statement | |
Net interest income | 3,291 |
Total income | 3,648 |
Net profit | 1,294 |
Earnings per share before dilution, SEK | 6.02 |
Earnings per share after dilution, SEK | 6.02 |
Balance sheet | |
Loans to the public | 45,470 |
Deposits and borrowings from the public | 42,663 |
Debt securities in issue | 1,248 |
Subordinated liabilities | - |
Total equity (shareholders of Norion Bank AB) | 7,803 |
Key ratios1) | |
Net interest margin (NIM) - Period 2) | 7.6% |
Net interest margin (NIM) - LTM 2) | 7.6% |
Credit loss level - Period 2) | 2.5% |
Credit loss level - LTM 2) | 2.5% |
C/I ratio - Period 2) | 25.6% |
C/I ratio - LTM 2) | 25.6% |
Return on equity (RoE) - Period 2) | 17.2% |
Return on equity (RoE) - LTM 2) | 17.2% |
CET1 ratio 3) | 15.9% |
Tier 1 ratio 3) | 17.0% |
Total capital ratio 3) | 17.0% |
Average number of full-time employees | 343 |
Adjusted key ratios 1) | |
Net interest margin (NIM) - Period 2) | 7.6% |
Net interest margin (NIM) - LTM 2) | 7.6% |
Credit loss level - Period 2) | 2.5% |
Credit loss level - LTM 2) | 2.5% |
C/I ratio - Period 2) | 25.6% |
C/I ratio - LTM 2) | 25.6% |
Return on equity (RoE) - Period 2) | 17.2% |
Return on equity (RoE) - LTM 2) | 17.2% |
- See Definitions, pages 22-23, and norionbank.se/en-se/investor-relations-en/financial-information/key-financials for more information about key ratios
- Key ratios that have not been prepared in accordance with IFRS but are deemed to facilitate the analysis of Norion Bank's development. See Definitions, pages 22-23
- Key ratios according to capital adequacy rules (CRR). See note 12, pages 44-46
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Interim report January - March 2024
Norion Bank Group is a business-oriented Nordic financing bank. The Group's brands - Norion Bank, Walley and Collector - offer customized financing solutions that meet distinct needs in three customer segments: medium-sized corporates and real estate companies, merchants, and private individuals. As a specialist in financing solutions, Norion Bank Group is a leading complement to traditional large banks, with a vision of being the leading Nordic financing bank in its chosen segments.
Norion Bank
Corporate and real estate loans, as well as factoring solutions, for medium-sized corporates and real estate companies.
Walley
Payment and checkout solutions for merchants and private customers.
Collector
Personal loans and credit cards for private individuals as well as savings accounts for private individuals and corporates.
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Norion Bank AB (publ) 556597-0513
A comment from our CEO
By the end of 2023, we started seeing improved market optimism driven by expectations of more stabilized interest rates. The positivity has remained during the first quarter of 2024 and the inflationary pressure has continued to ease. Market expectations now include rate cuts earlier than the initial forecasts, which will hopefully provide some ease for both our corporate and private clients.
Despite market optimism, we are still surrounded by geopolitical uncertainty. The war in Ukraine and the conflict in the Middle East are humanitarian crises that affect the macroeconomic environment at large, and we suffer with those affected.
Operating development
Stabilized market rates have contributed to a more optimistic market sentiment among our corporate clients, which we have also experienced during the first quarter. Engagement levels among existing and potential clients remain high. Our real estate business has hence shown a stable development with regards to new lending volumes. Despite solid interest and a relatively high client interaction frequency, transaction activity for corporate lending continued to be muted. The increased optimism has not yet resulted in increased new lending volumes given the cautious market sentiment.
The Consumer segment moves in the right direction during yet another quarter. The loan book increased by SEK 130 million during the first quarter of 2024, which is in line with our expectations.
Our focus on improving credit quality in new sales and increasing sales through own distribution channels continues to yield results. We continue prioritizing increased profitability above volume growth.
The Payments segment also continues to show stable performance. Growth in transaction volumes and loan book amounted to 15%, respectively, during the first quarter of 2024 compared to the same period last year. We continue to perform well relative to the e-commerce market at large.
Compared to almost two years ago, when we lived in a zero- interest environment, interest rate levels are significantly higher today. Our clients consequently face more challenges today, which can be seen in the stage migrations. On the other hand, we have also, during a longer period of time, made provisions for potential credit losses on a higher level to reflect the uncertain macroeconomic environment. The market has a more positive view on future developments, and rate cuts will have a positive effect on all our clients. We are humble towards future developments, but we also have good hopes for a more positive development later in the year.
Looking at the financial development, our loan book increased by 8% compared to the first quarter in 2023, and it decreased by 1% compared to last quarter. The decline compared to last quarter adheres to the Corporate segment, primarily driven by seasonality in our factoring business. The total income development shows stability and despite cost inflation and investments in the organization, the C/I ratio remains strong at 27.7% during the quarter. Return on equity amounted to 15.8% during the quarter and to 16.8% during the last twelve months.
By the end of the first quarter, we redeemed the AT1 bond of SEK 500 million that was issued in the first quarter of 2019.
The Tier 1 ratio and total capital ratio have consequently decreased. However, the bank maintains good buffers in relation to the regulatory requirements after the redemption. Over time, we aim to work with an efficient capital planning strategy, which includes issuance of both Additional Tier 1 and Tier 2 instruments.
Martin Nossman
CEO
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Interim report January - March 2024
MARTIN NOSSMAN, CEO
"Market sentiment
continues to
improve."
Photo: Anna Roström
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Financial targets
Norion Bank's strategy is to maintain good risk adjusted profitability. In line with this strategy, the Board of Norion Bank adopted the following financial targets on 6 February 2024:
Profitability | Norion Bank aims to achieve a sustainable return on equity |
above 15% over time. | |
Capital adequacy | Norion Bank's aim is that all capital ratios shall exceed the |
regulatory requirement by 200-400 basis points. | |
Norion Bank's policy is to distribute potential surplus capital in
Dividend policyrelation to the capital adequacy target, subject to the bank's future outlook and capital planning, to its shareholders.
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Norion Bank AB (publ) 556597-0513
Photo: Anna Roström
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Interim report January - March 2024
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Norion Bank AB published this content on 23 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 23 April 2024 05:43:08 UTC.
