Enity announces Q1 trading update and changes to group and capital structure alongside new financial targets

05 May 2025 08:15 CEST

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Enity Bank Group AB (publ) ("Enity Bank") announces:

· a Q1 trading update,
· that it has entered into an agreement to acquire the remaining 51% of the
shares in Eiendomsfinans AS not already owned,
· that its parent company, Enity Holding AB ("Enity Holding" or the "Group"),
has secured commitments from investors and will today issue AT1 notes of MSEK
250 (the "AT1 Notes"), and has resolved on a dividend distribution of MSEK 250
to optimise the Group's capital structure, and
· that Enity Holding has adopted new financial targets and a dividend policy.


Q1 2025 key performance metrics and financial position for Enity Bank

· Lending to the public increased by 7.3% during the last twelve months to
MSEK 29,310 as of 31 March 2025 (MSEK 27,309 as of 31 March 2024). Adjusted for
currency effects, the increase was 9.6% as the SEK has strengthened against both
NOK and EUR.
· Net profit for the period amounted to MSEK 72 (MSEK 48 in Q1 2024). Income
has grown in line with lending to the public, operating expenses have decreased
as a result of last year's cost optimisation and realisation of cost synergies
from the integration of Bank2 and net credit losses have increased, equivalent
to a credit loss level of 0.22% for the twelve month period ending 31 March
2025.
· Enity Bank has resolved to make a group contribution to Enity Holding in the
amount of MSEK 100 to cover for costs incurred relating to the strategic review
and the issuance of the AT1 Notes.
· The share of stage 3 loans (stage 3 ratio) amounted to 6.8% (5.6% as of 31
December 2024) as reported gross values for lending to the public at amortised
cost amounted to MSEK 27,552 (MSEK 27,170 as of 31 December 2024) and stage 3
reported gross values for lending to the public at amortised cost amounted to
MSEK 1,873 (MSEK 1,518 as of 31 December 2024).
· The leverage ratio (calculated according to the Capital Requirements
Regulation (EU) 575/2013 (CRR)) amounted to 7.3% (7.1% as of 31 December 2024)
for the Group.
· The Liquidity Coverage Ratio amounted to 497% (579% as of 31 December 2024)
for the Group and Net Stable Funding Ratio amounted to 126% (135% as of 31
December 2024) for the Group.
· The total risk-weighted exposure amounted to MSEK 14,468 (MSEK 14,823 as of
31 December 2024) for the Group.
· The Common Equity Tier 1 ('CET1') ratio was 17.3% (16.7% as of 31 December
2024) for the Group.
· The total capital ratio amounted to 19.2% (18.7% as of 31 December 2024) for
the Group.

Including significant events after the end of the period[1], the Group's Q1 2025
CET1, Tier 1 and total capital ratios would amount to 15.0%, 16.7% and 18.6%,
respectively, should these events have been carried out during Q1 2025. Please
see below for further information on the described events.

Acquisition of the remaining shares in Eiendomsfinans AS

Eiendomsfinans AS is a Norwegian mortgage broker in which Enity Bank currently
owns approximately 49% of the shares and votes. Enity Bank's Board of Directors
has today resolved on acquiring the remaining approximately 51% of the shares
and votes in Eiendomsfinans AS (including its subsidiary Eiendomsfinans Drift
AS) from Enity Holding's parent company, Butterfly HoldCo Pte. Ltd, at a total
purchase price of MSEK 83.1. The acquisition is expected to be completed on
6 May 2025, after which Eiendomsfinans AS will become a wholly-owned subsidiary
of Enity Bank.

New financial targets and dividend policy for Enity Holding

Enity Holding's Board of Directors has today adopted the following financial
targets:

· An annual organic lending growth of approximately 8-10 per cent over a
business cycle
· An adjusted return on tangible equity (RoTE) of approximately 20 per cent
· A CET1 ratio that exceeds the regulatory requirement by 200-300 basis points

Additionally, Enity Holding's Board of Directors has adopted a dividend policy
which targets a dividend of approximately 20-40 per cent of net profit for the
year attributable to shareholders, and any potential excess capital taking the
CET1 target into account.

AT1 Notes issuance and extraordinary dividend

Enity Holding has secured commitments from investors through a private placement
process and will today issue MSEK 250 AT1 Notes. The AT1 Notes will be perpetual
with first call after 5 years, paying a coupon of 3m STIBOR + 700 basis points.
The notes are intended to be listed on Nasdaq Stockholm within 4 months from the
date of issuance. Settlement date will be 12 May 2025.

Nordea and SEB acts as Joint Lead Managers in the transaction.

An Extraordinary General Meeting of Enity Holding has today resolved on an
extraordinary dividend distribution of MSEK 250, with payment date on 12 May
2025.

The purpose of Enity Holding's issuance of the AT1 Notes and payment of the
extraordinary dividend is to optimise the Group's capital structure.

Review of strategic options for Enity

On 19 February 2025, Enity Bank announced that its indirect majority shareholder
(EQT VII) has decided to initiate a review of strategic options for Enity. This
review is ongoing and includes, but is not limited to, a potential public
listing. The company and the participating banks may interact with potential
investors to gauge interest and feasibility of a public listing in Sweden. No
formal decisions have been taken, and further updates will be provided as and
when appropriate.

For further information, please contact:

Björn Lander, CEO, Enity Bank Group
+46 (0)73 673 1899
bjorn.lander@enity.com

Pontus Sardal, CFO, Enity Bank Group
+46 (0)70 149 9315
pontus.sardal@enity.com

Or visit: www.enity.com

Enity Bank Group AB (publ) is publishing this information which is obliged to be
made publicly available pursuant to the EU Market Abuse Regulation and the
Norwegian Securities Trading Act § 5 - 12. The information was submitted for
publication, through the agency of the contact persons set out above at 08.15
CEST on 5 May 2025.

Enity is a challenger in the Nordic mortgage market, with a vision to make
mortgages accessible to more people - regardless of employment type, financial
background or age. Through a portfolio of mortgage banks, Enity offers a modern
alternative to traditional banks. Since the group was founded as Bluestep
Bostadslån in Stockholm in 2005, its operations have expanded to Norway and
Finland, with 60plusbanken added in Sweden and Norwegian Bank2 joining the group
in April 2024.

Enity is under the supervision of the Swedish Financial Supervisory Authority
(Finansinspektionen). Additional information about Enity can be found on our
corporate website https://enity.com

Definitions of key operating metrics

Measure Definition
Adjusted return on Adjusted operating profit less tax (tax rate 20.6 per
tangible equity (RoTE) cent) in relation to average tangible equity. For
(%) quarters, the adjusted operating profit is annualized
by multiplying the amount for the quarter by four.
Tangible equity is calculated as total equity less
goodwill and intangible assets relating to
acquisitions. Average tangible equity is calculated as
the average of the opening and closing balance each
respective year/period end.
CET1 Common Equity Tier 1 capital comprises share capital,
paid-in capital, retained earnings and other reserves
of the companies included in the Group.
CET1 ratio (%) CET1 in relation to total risk-weighted amount.
Organic lending growth Growth in Lending to the public excluding acquisitions
(%) and divestments during the last twelve months,
compared to Lending to the public the same period last
year.
Stage 3 ratio (%) Loans classified as stage 3 in relation to lending to
the public before provisions, less equity release
loans.

Important information

This communication shall not constitute an offer to sell or the solicitation of
an offer to buy, nor shall there be any sale of any securities issued by Enity
Bank or its parent company Enity Holding in any jurisdiction in which such
offer, solicitation or sale would be unlawful prior to registration, exemption
from registration or qualification under the securities laws of any such
jurisdiction.

This announcement includes forward-looking statements which include statements
regarding the Enity Bank's and Enity Holding's business strategy, financial
condition, profitability, results of operations and market data, as well as
other statements that are not historical facts. Words such as "believe,"
"anticipate," "plan," "expect," "target," "estimate," "project," "predict,"
"forecast," "guideline," "should," "aim," "continue," "could," "guidance,"
"may," "potential," "will," as well as similar expressions and the negative of
such expressions are intended to identify forward-looking statements, but are
not the exclusive means of identifying these statements. By their nature,
forward-looking statements are subject to numerous factors, risks and
uncertainties that could cause actual outcomes and results to be materially
different from those projected. Readers are cautioned not to place undue
reliance on these forward-looking statements. Except for any ongoing obligation
to disclose material information as required by the applicable law, Enity Bank
does not have any intention or obligation to publicly update or revise any
forward-looking statements after it distributes this announcement, whether to
reflect any future events or circumstances or otherwise.

[1] Includes the acquisition of the remaining shares in Eiendomsfinans AS
(including its subsidiary Eiendomsfinans Drift AS), as well as the extraordinary
dividend distribution, AT1 Notes issuance resolved by the Board of Directors of
Enity Holding and a change in the included capital portion of Enity Bank's Tier
2 bond.

More information:
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