SpareBank 1 SMN - Effect of the increased risk weight floor for mortgages and changes in the CRR3 framework

10 Dec 2024 16:12 CET

The Ministry of Finance resolved on 6 December to increase the average risk
weight required for mortgages secured by residential property in Norway for
banks applying the Internal Ratings-Based (IRB) approach from 20 to 25 per cent.
The new provision will be effective from 1 July 2025 onwards.

For SpareBank 1 SMN the effect of the increased risk weight floor is in
isolation estimated to be an approximate 1.2 percentage point reduction in its
Common Equity Tier 1 (CET1) ratio.

CRR3 enters into force in the EU on 1 January 2025. Introduction of the
framework in Norway is expected to be rapid, and the changes are estimated to
bring an increase of about 0.2 percentage point in SpareBank 1 SMN’s CET1 ratio.


The bank’s reported CET1 ratio as of Q3 2024 was 18.2% (with account taken of a
73% dividend payout ratio), while the bank’s current regulatory requirement
including Pillar 2 Guidance is 16.95%.

Trondheim, 10 December 2024

Contact persons at SpareBank 1 SMN:
CFO Trond Søraas on +47 922 36 803
Executive director, Risk, Ola Neråsen on +47 918 0 722

The above information is publicly disclosable under Section 5-12 of the
Securities Trading Act.

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