SpareBank 1 Østlandet (SPOL): High activity and strong profitability

07 Aug 2025 07:00 CEST

SpareBank 1 Østlandet's consolidated profit after tax for the second quarter of
2025 was NOK 917 (716) million. The return on equity was 14.9 (14.2) percent.

Strong returns were driven by solid contributions from all income lines and very
low loan losses.

«In the first half of the year, we achieved a return on equity well above the
target of 13 percent. In the retail market, we are once again delivering one of
our best quarters. We have strong underlying growth in loans and deposits, as
well as increased non-interest income, particularly in insurance and real
estate», says Group CEO Klara-Lise Aasen.

Net interest income including commissions from the covered bond companies was
NOK 1,283 million, an increase of 3.2 percent from the same quarter last year
(pro forma). In the retail market, the bank's loan volume increased by 4.9
percent. The number of mortgage applications that were initiated in the first
half of the year quarter was about 80 per cent higher than in the same period
last year. In the corporate market, activity is lower and the bank's loan
portfolio has remained stable. However, interest rate cuts from Norges Bank
could help increase activity among our customers. With very high customer
satisfaction among our corporate clients, the bank is well positioned for growth
when the market turns.

The bank's commission income continues to increase, by 7.3 percent from the
second quarter last year, excluding commissions from the covered bond companies
and on a pro forma basis. Commission income from insurance has shown
particularly strong development, but commissions from the recently merged real
estate agency have also increased significantly over the past year, with high
sales of both used homes and housing projects.

The bank's impairment charges in the second quarter were NOK 1 million, which is
very low. There has been targeted and effective work over time to deal with a
small number of problem loans. The quality of the loan portfolio generally
remains solid.

Costs in the second quarter of 2025 were NOK 786 million, representing an
increase so far this year of 11.8 percent compared to the same period last year
(pro forma). Some of the increase was due to one-off effects, including
provisions related to the court ruling between SpareBank 1 Utvikling DA and
Tietoevry Norway AS, as well as an exit agreement with Eika Gruppen, but cost
growth also comes from new initiatives and continuous strengthening of business
development, regulatory compliance, and quality initiatives.

“We are continuously working to improve SpareBank 1 Østlandet. During the
spring, we have worked on a strategy for the group. The overarching vision and
mission for our financial house have been merged into 'Together we develop
Eastern Norway'. This is our guiding star going forward. During the autumn, we
will develop operational strategic plans and concrete goals, so that it is not
just fine words, but also actions”, says Aasen.

Capital adequacy was significantly strengthened through the implementation of
CRR3 and the contribution from the period's results. With the implementation of
increased risk weight floors for housing mortgages in the third quarter of 2025,
a significant reduction in capital adequacy is expected. However, the total
regulatory changes in 2Q and 3Q are estimated to have a small positive net
effect, supporting the bank's lending and dividend capacity.

Q2 2025 (Consolidated figures. Figures in brackets concern the corresponding
period in 2024)
• Profit after tax: NOK 917 (716) million
• Return on equity: 14.9 (14.2) per cent
• Earnings per equity capital certificate: NOK 4.71 (4.09)
• Net interest income: NOK 1,159 (1,008) million
• Net commissions and other operating income: NOK 519 (446) million
• Net income from financial assets and liabilities was NOK 248 (142) million.
• Total operating expenses: NOK 785 (636) million
• Net loan loss provisions were NOK 1 (39) million
• Lending growth in the last quarter, including mortgages transferred to the
covered bond companies: 1.4 (2.1) per cent
• Deposit growth in the last quarter: 5.4 (6.6) per cent
• Common Equity Tier 1 capital ratio: 18.3 (16.8) per cent
• The Bank's green loans (incl. loans transferred to the covered bond companies)
amounted to NOK 45 (43) billion at the end of the fourth quarter

Contact information:
Klara-Lise Aasen, Group CEO, Tel.: +47 476 35 583
Geir-Egil Bolstad, CFO, Tel.: +47 918 82 071
Bjørn-Erik Orskaug, Head of Investor Relations, Tel.: +47 922 39 185

This information must be disclosed pursuant to section 5-12 of the Securities
Trading Act.

More information:
Access the news on Oslo Bors NewsWeb site

652244_SPOL_2025Q2_ ENG_quarterly report.pdf
652244_SPOL_20252Q_ENG_Quarterly presentation.pdf