Third Quarter Results 2018

CEO Casper von Koskull’s comments on the results:

“Third quarter was challenging, and we are not satisfied with the revenue development. Net interest income was stable, while fees and commission and specifically net fair value were weak, mainly due to difficult market conditions and lower corporate activity.

However, we continued to deliver on costs, credit quality remained strong and capital ratios improved to an all-time high.

Our customer satisfaction improved for the third consecutive quarter, especially in Sweden. Lending volumes are growing, and we see a more promising deal flow pipeline going into the fourth quarter.

This quarter was a historic quarter for Nordea, as we finalised our re-domiciliation into the Banking Union and Finland. The move is part of Nordea’s overall strategic direction, enabling us to operate in an environment that offers stability, predictability and a level playing field. The business model for the Group will not be impacted by the move, but it will help us to increase our focus on further developing the bank, and becoming an even better bank for Nordea’s customers, employees and shareholders.

On 13 September Nordea and DNB announced that Blackstone will acquire 60% of all shares in Luminor. Over the coming years, Nordea will sell its remaining 20% shares to Blackstone. On 15 October, the divestment of our Luxembourg-based private banking business was finalised. 

I can say that Nordea is now repositioned to be a truly Nordic- focused bank with a very clear and simple structure, and a record-strong balance sheet, enabling us to be an even better bank for our customers while at the same time structurally bringing down costs and increasing efficiency.”

Third quarter 2018 vs. Third quarter 2017 (Third quarter 2018 vs. Second quarter 2018)  

• Net interest income EUR 1,072m, -10%; -8% in local currencies (0%, 0% in local currencies)
• Total operating income EUR 2,046m, -14%; -12% in local currencies (-19%, -19% in local currencies)
• Total expenses EUR 1,136m, -6%; -3% in local currencies (-2%, -1% in local currencies)
• Profit before loan losses EUR 910m, -22%; -21% in local currencies (-34%, -34% in local currencies)
• Net loan losses EUR 44m, -44%; -44% in local currencies (-25%, -28% in local currencies)
• Operating profit EUR 866m, -21%; -19% in local currencies (-35%, -35% in local currencies)
• Common Equity Tier 1 capital ratio 20.3% vs.19.3% (20.3% vs. 19.9%)
• Cost/income ratio 56% vs. 51% (56% vs. 45%)
• Loan loss ratio of 8 bps vs. 10 bps (8 bps vs.10 bps)
• Return on equity 8.7% vs 10.5% (8.7% vs. 13.9%)
• Diluted EPS EUR 0.17 vs. EUR 0.21 (EUR 0.17 vs. EUR 0.27)

Exchange rates used for Q3 2018 for income statement items are for DKK 7.4503, NOK 9.5900 and SEK 10.2414. 

Latest interim results

The information provided in this stock exchange release was submitted for publication through the agency of the contact persons set out above at 07:30 EET (06:30 CET) on 24 October 2018.

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