• Core income for H1 increased 17% relative to the first half of 2014, ending at DKK 1,920 million. Net interest income was up 6% due to volume acquired and the redemption of governmental hybrid core capital, while net income from fees, charges and commissions grew 42% after remarkably brisk activity in the housing and asset area, and market-value adjustments swelled 38% driven by the sale of the shareholding in Nørresundby Bank.
• Adjusted for the sale of the shareholding in Nørresundby Bank and the sale of Nets shares last year, core income grew by 16%.
• Expenses ended at DKK 964 million, equal to a 4% rise on H1 2014, which was an expected result of acquisitions, etc. Accordingly, the cost/income ratio improved to 0.50 (excl. the sale of Nørresundby Bank: 0.56).
• Core earnings before impairment thus ended at DKK 955 million – 34% up on H1 2014.
• Loan impairment losses, etc. amounted to DKK 166 million, equal to an impairment ratio of 0.71% p.a. – impairment losses on retail customers came to DKK 21 million and DKK 6 million for business customers, excl. losses on agricultural customers, which amounted to DKK 139 million.
• The Group’s total business volume grew 4% on end-2014, standing at DKK 204 billion at end-H1 – growth was driven by capital under management, deposits and mortgage-credit lending, while the lending volume has dropped by 4% since January 1.
• The Group is in a comfortable capital and liquidity situation, with a Common Equity (Tier 1) ratio of 13.5%, an excess coverage relative to the individual solvency need ratio of 6.7 percentage points (DKK 3.2 billion) and a strategic liquidity of DKK 18.9 billion.
• In light of developments in H1, Spar Nord Bank maintains its full-year forecast for core earnings before impairment of about DKK 1.5 billion – loan impairment losses are expected to hover around DKK 300-350 million.
• Simultaneously with the publishing of the Interim Report for the first six months, we are announcing a new dividend policy with a minimum distribution of two-thirds of the net profit for the year.
Q2: NORMALIZATION OF INCOME FROM FEES, CHARGES AND COMMISSIONS AND THE ABSENCE OF EXTRAORDINARY INCOME HAD A NEGATIVE EFFECT ON PROFITS, WHILE A DECREASE IN LOAN IMPAIRMENT LOSSES HAD A POSITIVE IMPACT
• Core income of DKK 780 million versus DKK 1,140 million in Q1 2015, and DKK 730 million in Q2 2014: The decline compared with Q1 is due to a reduction in activity-contingent earnings and the absence of extraordinary income (Nørresundby Bank).
• Expenses in Q2 amounted to DKK 480 million versus DKK 484 million in Q1 2015, and DKK 469 million in Q2 2014.
• Loan impairment dropped from DKK 98 million in Q1 to DKK 69 million in Q2 after positive trends in all customer segments other than agriculture.
Contact: Ole Madsen, Senior Vice President, tel. +45 9634 4010
