First quarter interim report 2016: Stronger results for Landshypotek Bank
Landshypotek Bank continues to post improved results. In the first quarter of 2016, operating profit strengthened by slightly more than SEK 58 million year-on-year. Excluding the net result of financial transactions, underlying operating profit increased by almost MSEK 6.
“We are growing our deposits and our lending, and continuing to improve our results. The start of the year strengthens us in our ongoing transition toward becoming an even better bank for our customers,” says Liza Nyberg, CEO of Landshypotek Bank.
The improved results were attributable to stronger net interest income and a stronger net result of financial transactions. At the same time, costs were in line with the preceding year. Results improved even when compared with the last quarter. At the end of the first quarter, the bank’s loans outstanding totalled SEK 65.1 billion and deposits amounted to SEK 10.7 billion.
Landshypotek Bank is developing to meet the changes taking place in the lending market for farming and forestry. Due to structural changes, some farmers are conducting operations in the form of ever growing companies, either niched or diversified. Other customers are investing in reduced operations with added value and direct sales to customers. Many customers choose to live in the countryside, but make their living from employment and not by running active farming and forestry operations.
“We serve them all. The increased variety of operations provides us with significant opportunities, firstly to further diversify our operations and, secondly to grow with more customers. During the quarter, we have strengthened contact with customers who live on farms and who derive their income from employment. The response from the customers was considerable and overwhelmingly positive,” notes Liza Nyberg.
Based on this customer trend as well as capital and regulatory changes, Landshypotek Bank is changing its exposure classes and intends to apply for a new fundamental internal ratings-based (IRB) risk classification approach for our corporate business. The bank has also, applying a healthy margin, prepared for the increased capital requirement that will arise as a consequence of this change. Both Fitch and Standard & Poor confirmed Landshypotek Bank’s rating following the bank’s announced changes in exposure classes.
Landshypotek Bank Q1 in brief
January – March 2016 compared with January – March 2015
• Operating profit amounted to MSEK 115.4 (56.7)
• The underlying operating profit, profit excluding financial transactions, totalled MSEK 74.9 (69.0).
• Net interest income rose MSEK 5.2 to MSEK 176.5 (171.4).
• Costs increased and totalled MSEK 96.5 (95.7).
• Net loan losses declined and amounted to MSEK 8.3 (9.4).
• Lending amounted to SEK 65.1 billion (62.2).
• Deposits totalled SEK 10.7 billion (6.8), up SEK 3.9 billion.
January – March 2016 compared with October – December 2015
• Operating profit amounted to MSEK 115.4 (62.7)
• The underlying operating profit, excluding the net result of financial transactions, was MSEK 74.9 (67.8).
• Net interest income amounted to MSEK 176.5 (189.0).
• Costs totalled MSEK 96.5 (117.7)
• Net loan losses were MSEK 8.3 (7.3).
• Lending amounted to SEK 65.1 billion (64.5).
• Deposits amounted to SEK 10.7 billion (10.3).
For further information and comments, please contact:
Tomas Uddin, Chief Communications Officer at Landshypotek Bank, +46 (0)70-299 24 08
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