Third-quarter results 2024

Nordea Bank Abp
Interim report (Q1 and Q3)
17 October 2024 at 7.30 EET

Summary of the quarter

Continued income growth. Total income was up 2%. Net interest income was 1% lower, following policy rate reductions. Net fee and commission income continued to grow, up 4%. Net insurance result remained solid and net fair value result improved by 26%. Costs rose by 9%, excluding a EUR 32m item related to the settlement of a regulatory investigation in the US. More than half of this increase was attributable to higher investment in growth, technology and risk management. Operating profit amounted to EUR 1.6bn.

Return on equity 16.7% – earnings per share EUR 0.36. Nordea’s return on equity remained very strong at 16.7% in the third quarter, reflecting Nordea’s resilience and continued high performance. For the third quarter, our cost-to-income ratio with amortised resolution fees and excluding the US settlement was 43.4%, compared with 42.4% a year ago. Earnings per share were EUR 0.36, compared to EUR 0.38 a year ago.

Mortgage lending stable, deposit volumes up. The Nordic mortgage and corporate lending markets remained slow, though demand for new loan promises again increased, indicating that the housing markets are improving. Retail and corporate deposit volumes increased by 2% and 9%, respectively, year on year. Assets under management increased by 15% and Nordic net flows amounted to EUR 4.2bn in the quarter.

Solid credit quality, net loan losses increase mainly driven by a couple of corporate exposures. Net loan losses and similar net result amounted to EUR 51m or 6bp. EUR 30m was released from the management judgement buffer reflecting lower provisioning requirements. The total management judgement buffer now stands at EUR 435m.

Continued strong capital generation, share buy-backs to be resumed. We maintain a strong capital position and continue to generate capital. Our CET1 ratio was 15.8% at the end of the quarter, 2.3 percentage points above our capital requirement. The decrease from 17.5% in the previous quarter was as expected due to the implementation of new capital models for retail exposures during the third quarter. Following the successful implementation we are now ready to resume share buy-backs. During October, we will launch a new share buy-back programme of EUR 250m, which will be completed by the end of February 2025.

Outlook for 2024 updated: return on equity above 16%. Nordea has a strong and resilient business model with a very well-diversified loan portfolio across the Nordic region. This enables the bank to support its customers and deliver high-quality earnings, with high profitability and low volatility, through the economic cycle.

(For further viewpoints, see the CEO comment on page 2. For definitions, see page 54 in the Q3 2024 report.)

Group quarterly results and key ratios

CEO comment

We continued to perform well in the third quarter. Profitability was again at a good level, and our return on equity has clearly exceeded 15% for the past eight quarters. Business volumes were stable and customer activity was good, supporting a year-on-year increase in income.

Nordea’s performance demonstrates a sustainable improvement in profitability, which in turn has strengthened our ability to serve our customers. We have been by our customers’ side during the more challenging times for the Nordic economies, and we will continue to take a leading role in supporting them as the outlook brightens. Lower inflation and the prospect of lower interest rates have boosted consumer confidence, and we have seen signs of that in both household and corporate activity.

During the quarter, customers increased their savings and investment activity, which drove strong demand for our deposit products. Retail and corporate deposit volumes increased by 2% and 9%, respectively, year on year in highly competitive markets. Debt capital markets activity also continued at a good pace, despite this typically being a seasonally weaker quarter.

Lending volumes were relatively stable in what continued to be slow markets. We actively engaged with our corporate customers who were focused more on refinancing loans rather than increasing borrowing to invest in new growth, and thereby maintained solid corporate lending volumes. Mortgage lending remained stable in subdued housing markets. On a positive note, demand for new loan promises, a leading indicator for higher future home sales, grew for the second straight quarter.

Total income grew 2% year on year to EUR 3.0bn. The increase included 4% growth in net fee and commission income, reflecting customers’ increased savings activity. Net interest income was resilient, down 1%, driven by lower deposit margins, as expected. Operating profit amounted to EUR 1.6bn, down from EUR 1.7bn. Our return on equity was 16.7%, or 17.1% excluding the US settlement.

Our financial performance has given us a strong capacity to invest for the future. To drive our strategy forward, we have made significant investments into technology, data and AI and other key capabilities. These will enable us to tap into the benefits of our unique Nordic scale, providing differentiation that cannot easily be copied. We are also growing our position in Norway, including through the acquisition of Danske Bank's personal customer and private banking business there. Together, these investments were the main driver of our 9% year-on-year increase in costs during the third quarter. Cost growth for the full year 2025 will be significantly lower than this. Our investments have allowed us to take significant steps forward, and we will continue to invest for our customers. The cost-to-income ratio with amortised resolution fees and excluding the US settlement was 43.4% in the third quarter, compared with 42.4% a year ago.

Our credit performance remains solid, with strong asset quality. Net loan losses and similar net result amounted to EUR 51m, or 6bp, for the quarter. Reflecting the positive macroeconomic outlook, we released a further EUR 30 million from our management judgement buffer, which now stands at EUR 435 million. Our risk position is sound, and credit quality continues to be strong and in line with our long-term expectations.

In Personal Banking, the higher demand for new loan promises signalled that Nordic housing markets are in a recovery phase. Increased customer investment activity also indicates improved macroeconomic sentiment. Customers continued to enjoy using our digital services, with the number of private app users and logins both up 5% year on year. In September, we won in six categories in Global Finance Magazine’s 2024 World’s Best Digital Bank Awards, including the award for Best Consumer Digital Bank in Western Europe.

In Business Banking, we continued to engage with customers, supporting them as activity levels remained high and demand for interest rate and foreign exchange hedging was especially strong. Deposit volumes grew by 3% year on year in local currencies, and lending volumes remained stable. We also further strengthened service quality, including increasing adviser availability, building on our Nordic scale benefits.

Large Corporates & Institutions maintained the good momentum from the first half of the year, actively supporting our Nordic customers with their investment plans. This year, we have arranged more than 500 debt capital markets transactions for our customers, as we helped them continue to make the most of favourable funding markets. Furthermore, we are one of the lead banks supporting DSV in its planned acquisition of Schenker, one of the largest ever deals by a Nordic company.

In Asset & Wealth Management, we continued to grow our private banking business with sustained high activity in customer acquisition and secured positive net flows of EUR 3.6bn. Assets under management increased by 15% year on year to EUR 412bn. Our sustainability efforts were rewarded with the 2024 PRI Award “Recognition for Action – Climate” from the United Nations Principles for Responsible Investments (UNPRI). Momentum remained strong in our life insurance and pension business. Gross written premiums increased to EUR 2.6bn from EUR 1.8bn a year ago.

We maintain a strong capital position and continue to generate capital. Our CET1 ratio stood at 15.8% at the end of the quarter, 2.3 percentage points above our capital requirement. The decrease from 17.5% in the previous quarter was expected after we implemented our new capital models for retail exposures during the third quarter.

Our strong results show how we are on a good path to making Nordea the best bank for customers and employees. In addition, having successfully implemented our new retail capital models, we are resuming share buybacks, with our next program beginning this month.

Given our strong performance through this year, we have updated our outlook and now expect full-year 2024 return on equity to be above 16%. Since our repositioning in 2019, we have lifted Nordea to a new level through lasting efficiencies and focused, profitable growth. We believe our structurally improved profitability will help us sustain our position as one of the best-performing universal banks in Europe. Accordingly, we remain confident in our ability to deliver a return on equity of above 15% for 2025.

Our ambition remains unchanged – to be the preferred financial partner for customers in need of a broad range of financial services.

Frank Vang-Jensen
President and Group CEO

Outlook (updated)

Financial target for 2025

Nordea’s financial target for 2025 is a return on equity of above 15%.

The target will be supported by a cost-to-income ratio of 44–46%, an annual net loan loss ratio of around 10bp and the continuation of Nordea’s well-established capital and dividend policies.

Financial outlook for 2024 (updated)

Nordea expects a return on equity of above 16%.

Capital policy

A management buffer of 150bp above the regulatory CET1 requirement.

Dividend policy

Nordea’s dividend policy stipulates a dividend payout ratio of 60–70%, applicable to profit for the financial year. Nordea will continuously assess the opportunity to use share buy-backs as a tool to distribute excess capital.

Outlook (previous)

Financial target for 2025

Nordea’s financial target for 2025 is a return on equity of above 15%.

The target will be supported by a cost-to-income ratio of 44–46%, an annual net loan loss ratio of around 10bp and the continuation of Nordea’s well-established capital and dividend policies.

Financial outlook for 2024

Nordea expects a return on equity of above 15%.

Capital policy

A management buffer of 150bp above the regulatory CET1 requirement.

Dividend policy

Nordea’s dividend policy stipulates a dividend payout ratio of 60–70%, applicable to profit for the financial year. Nordea will continuously assess the opportunity to use share buy-backs as a tool to distribute excess capital.

Income statement

Business volumes, key items1

1. End of period. 

Ratios and key figures including items affecting comparability1

1. See here for more detailed information regarding ratios and key figures defined as alternative performance measures.
2. End of period. 
3. Including the result for the period.

This release is a summary of Nordea’s Q3 results 2024. The complete report is attached to this release and can also be found on the below link on our website.

Nordea Group Q3 2024 Report

A webcast will be held on 17 October at 11.00 EET (10.00 CET). Frank Vang-Jensen, President and Group CEO, will present the results followed by a Q&A audio session for investors and analysts with Frank Vang-Jensen, Ian Smith, Group CFO and Ilkka Ottoila, Head of Investor Relations.

The event will be webcast live and the recording and presentation slides will be posted on www.nordea.com/ir.

For further information:

Frank Vang-Jensen, President and Group CEO, +358 503 821 391
Ian Smith, Group CFO, +45 5547 8372
Ilkka Ottoila, Head of Investor Relations, +358 9 5300 7058
Ulrika Romantschuk, Head of Brand, Communication and Marketing, +358 10 416 8023

The information provided in this stock exchange release was submitted for publication, through the agency of the contacts set out above, at 07.30 EET (06.30 CET) on 17 October 2024.


We are a universal bank with a 200-year history of supporting and growing the Nordic economies – enabling dreams and aspirations for a greater good. Every day, we work to support our customers’ financial development, delivering best-in-class omnichannel customer experiences and driving sustainable change. The Nordea share is listed on the Nasdaq Helsinki, Nasdaq Copenhagen and Nasdaq Stockholm exchanges. Read more about us at nordea.com.

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