The fine result is due to:
- strong growth in sales which brought a sound increase in other income in the parent bank: NOK 73 million (NOK 48 million)
- reduced operating expenses in the parent bank after the introduction of a wide-ranging efficiency programme: NOK 150 million (NOK 155 million)
- high capital gains on securities: NOK 28 million (-NOK 13 million)
- net profit in the SpareBank 1 Group, of which SpareBank 1 Midt-Norge's share comes to NOK 2 million (-NOK 4 million)
- lower losses on loans to the business sector
- but a 5 basis points reduction in the interest rate spread compared with the 4th quarter of 2003
Excellent sales of savings and investment products brought an increase of NOK 16 million in other income in the current year's first quarter.
The fall in net interest income is due to a reduction in market interest rates over the past year resulting in reduced deposit spreads and lower return on the bank's equity capital. This is compensated for by strong growth in home mortgage lending.
Net first-quarter losses come to NOK 35 million compared with a net loss of NOK 60 million in the same period last year. First-quarter operating profit provides a return on equity of 15.0% and earnings of NOK 5.70 per primary capital certificate.
Gross outstanding loans total NOK 32,797 million, an increase of NOK 1,349 million (4.3%) over the same period last year. Loans break down to 62% to the retail market and 38% to the corporate market and the public sector. Deposits total NOK 19,314 million. The increase in the 12 twelve months to end-March comes to NOK 147 million or 0.8%. Retail customer deposits rose by 2.0% while deposits from corporate clients fell by 0.9%.
SpareBank 1 Midt-Norge's total assets as at 31 March 2004 come to NOK 36,331 million (NOK 36,896 million).
The bank's Supervisory Board decided at its meeting on 17 March to carry out a bonus issue. At year-end the price, corrected for the effect of the bonus issue, stood at NOK 191. At the end of the first quarter the price was NOK 187. Dividend of NOK 18 per primary capital certificate was paid in the first quarter.
At the end of the previous quarter, the Board of Directors presented positive expectations for the bank in 2004. This was grounded in a positive market view along with the effect of the relatively extensive profit improvement measures carried out in 2003. The first-quarter accounts confirm the positive trend. The Directors expect the good trend to continue in the quarter ahead.
Any queries can be put to Managing Director Finn Haugan
on + 47 90 04 10 02 or CFO Kjell Fordal on +47 90 54 16 72.