Interim report Q1 2020
Headlines Q1 2020 (Figures in brackets are for the same period last year) Solid growth in loans to customers: 6,0 % over the past year Growth in net interest income: NOK 250 mill. (NOK 220 mill.) Negative results from financial instruments : NOK -49 mill (NOK 30 mill.) Higher losses as a result of the corona pandemic: NOK 80 mill. (NOK 1 mill) Solid liquidity and solidity: • LCR 122 % (165 %) • Core Tier 1 Capital adequacy ratio: 15,9 % (15,3 %) Return on equity: 0,9 % p.a. (10,8 % p.a.)
Development important key figures Impairment loss Cost/income ratio 53,2 % 0,16 % 43,3 % 41,6 % 39,1 % 37,0 % 0,04 % 0,02 % 0,02 % 0,00 % Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Return on equity Core Tier 1 capital adequacy ratio 18,0 % 16,3 % 16,0 % 15,9 % 15,3 % 16,0 % 14,8 % 14,7 % 13,4 % 14,0 % 12,5 % 14,0 % 12,0 % 10,8 % 12,0 % 10,1 % 10,0 % 10,0 % 8,0 % 8,0 % 6,0 % 6,0 % 4,0 % 4,0 % 2,0 % 2,0 % 0,9 % 0,0 % 0,0 % Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020
Solid growth in lending and higher customer margins increase net interest income Net interest income as a Net interest income percentage of average assets 2,00 300 1,73 1,71 1,69 1,80 1,65 250 1,62 248 241 250 230 1,60 220 1,40 200 1,20 1,00 150 0,80 100 0,60 0,40 50 0,20 0 0,00 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Net interest income in NOK million and as a percentage of average total assets (GFK)
Solid growth in the retail market Loans retail market Deposits retail market 30 12,0 % 45 12,0 % 38,6 38,2 40 37,7 37,2 36,4 10,0 % 25 10,0 % 35 20 8,0 % 7,3 % 30 8,0 % 18,0 17,7 17,5 17,5 17,0 6,0 % 25 5,9 % 5,8 % 5,8 % 5,5 % 6,0 % 5,4 % 15 6,0 % 5,0 % 4,9 % 20 4,4 % 4,0 % 10 15 4,0 % 10 5 2,0 % 2,0 % 5 0,0 % 0 0 0,0 % Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 NOK billion 12 months growth in % NOK billion 12 months growth in %
The corporate market shows a satisfactory development Deposits corporate market Loans corporate market 12,0 % 14 13,1 12,9 12,7 12,6 12,4 10,0 % 20,0 % 12 14 12 15,0 % 10 8,0 % 11,1 11,0 10,8 10,6 10,6 6,5 % 10 5,9 % 8 6,0 % 10,0 % 4,8 % 8 4,5 % 6 3,9 % 4,0 % 6 5,0 % 2,2 % 4 1,6 % 0,6 % 4 0,3 % -0,5 % 2,0 % 0,0 % 2 2 0 0,0 % 0 -5,0 % Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 I mrd. kr 12. mnd. vekst i % I mrd. kr 12. mnd. vekst i % .
Impairment losses on shareholdings give a negative result on financial instrument 220 Other income Total income 170 338 322 120 325 286 281 81 90 90 275 233 81 61 56 225 61 70 57 53 45 175 20 30 -17 125 250 248 241 230 220 20 37 37 32 36 32 75 25 -49 -17 -30 -25 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Net interest income Other operating income Other oper. income Fin. investments Figures per quarter in mill. NOK.
Low cost growth The cost precentage increases due to negative results from shares Operating expenses Cost/income ratio 132 140 124 122 119 119 120 53,2 % 100 43,3 % 41,6 % 39,1 % 37,0 % 80 60 40 20 0 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Figures per quarter in mill. NOK.
Increase loss provisions as a result of the corona pandemic Impairments Impairment provisions 400 364 80 1,00 % 350 321 80 306 301 295 70 300 0,71 % 0,80 % 60 0,64 % 0,61 % 250 0,60 % 0,60 % 50 0,60 % 40 200 30 22 150 0,40 % 20 9 8 10 1 100 0,20 % 0 50 -10 -20 0 0,00 % Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Mill. NOK As a % of gross lending Figures per quarter in mill. NOK .
Increased credit losses on loans and negative contribution from shares result in a decline in profits Total comprehensive income Return on equity 16,0 % 180 163 13,4 % 14,0 % 160 148 12,5 % 140 12,0 % 126 10,8 % 117 10,1 % 120 10,0 % 100 8,0 % 80 6,0 % 60 4,0 % 40 2,0 % 12 0,9 % 20 0,0 % 0 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Figures for the quarters in NOK mill. Return on equity is calulated based on the opening equity excl. hybrid capital.
Strong capital adequacy Capital adequacy ratio Leverage ratio 16,0 % 25,0 % 14,0 % 19,0 % 19,5 % 20,0 % 18,3 % 18,2 % 12,0 % 18,1 % 2,0 % 2,0 % 2,1 % 2,6 % 1,2 % 2,6 % 1,1 % 10,0 % 0,9 % 0,8 % 15,0 % 0,8 % 16,3 % 8,8 % 8,7 % 15,9 % 8,3 % 15,3 % 8,0 % 8,0 % 14,8 % 14,7 % 8,0 % 10,0 % 6,0 % 4,0 % 5,0 % 2,0 % 0,0 % 0,0 % Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Tier 1 capital adequacy ratio Hybrid capital Suplementary capital Capital adequacy per Q4 19 has been changed from previous reporting period due to reduced dividend and an error in reported capital adequacy in connection with the introduction of SME discount
Segments and industries Lending segments Lendings to the corporate market in NOK mill. 3.707 Property managment 2.161 Fishing and fish farming 25 % 1.518 Farming and forestry 1.319 Building and construction 931 Industry and mining 911 Services 75 % 858 Electrical power 826 Commerce 539 Hotels/tourism 343 Transport - 500 1.000 1.500 2.000 2.500 3.000 3.500 4.000 Corporate market Retail market
Credit risk to the corporate market is stable Loans to the corporate market at high risk Loans to the corporate market in default 10,00 % 14,0 % 9,00 % 12,0 % 8,00 % 10,2 % 10,1 % 10,0 % 10,0 % 10,0 % 7,00 % 10,0 % 6,00 % 8,0 % 5,00 % 6,0 % 4,00 % 3,00 % 4,0 % 2,00 % 0,90 % 0,89 % 0,83 % 0,79 % 0,82 % 2,0 % 1,00 % 0,00 % 0,0 % Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020
Low risk in the retail market Composition of risk for loans to RM Loans to the RM in default (%) 2,00 % 80,0 % 71,9 % 71,3 % 70,1 % 69,9 % 69,7 % 70,0 % 1,50 % 60,0 % 50,0 % 1,00 % 40,0 % 26,5 % 26,4 % 26,1 % 30,0 % 25,2 % 24,8 % 20,0 % 0,50 % 0,36 % 0,33 % 0,32 % 0,32 % 0,26 % 10,0 % 3,5 % 3,8 % 3,7 % 3,8 % 3,5 % 0,0 % 0,00 % Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Low risk Middle risk High risk
Maturity structure of funding 5500 150 300 100 4500 200 3500 200 2500 2500 300 2500 2500 3000 2500 1500 2200 2100 700 1200 500 1000 197 600 500 500 385 400 2020 2021 2022 2023 2024 2025 2030 2033 2034 -500 Senior bonds and commercial papers Covered bonds Loans from other credit institutions incl. central bank Subordinated debt and hybrid capital (call date) Figures in NOK mill .
Strategy and society
A driving force for Sogn og Fjordane 46,7 % Retail market 32,5 % Corporate market 47,0 % Real estate * Market share of lending: number per Q4 2019 Kjelde: SSB, Eiendomsverdi, number per april 2020 17
Sustainable society Sogn og Fjordane is Everything we have, we create together. We are a society In the first quater we launched green mortage loans and climate loans for our customers
Google pay and smartwatch payment establiched Google pay launched in March 2020 At the same time, we launched watch payments with smartwatch from Fitbit and Garmin 19
Podium place at EPSI – regardless of industry In competition with companies from eleven different industries in Norway, we are in the second place on customer satisfaction with private customers. 20
Ownership and social responsibility In 2020 around NOK 55 millions will be used for socially useful purposes through both gifts and sponsorships. 21
Dividend ensures stable gift capacity for the years to come Many voluntary organisations in Sogn og Fjordane have been affected by the corona situation. We have allocated MNOK 90 in dividends and gifts to ensure stable gift capacity for the years to come. 22
New application round due to the corona situation Much has changed since the ordinary application deadline for our largest owner foundation expired on March 1. We see that many voluntary organisations face financial challenges. We are therefore opening up for one extra application round to help in demanding times. 23
Tablets reduce social distance Retirement- and nursing homes have introduced isolation measures due to the corona pandemic, which means that residents should not receive visits from their families. Our foundation have purchased tablets to all retirement homes in Sogn og Fjordane to reduce social distance. 24
Contact information Sparebanken Sogn og Fjordane Visiting address: Langebruvegen 12 6801 Førde Website: www.ssf.no E-mail address: kundesenter@ssf.no Organisation no: 946 670 081 Tel no. 57 82 97 00 Contact: Trond Teigene Frode Vasseth CEO CFO Tel. no. + 47 908 25 086 Tel. no. + 47 951 98 452
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