NONG result 2nd quarter 2007

Half-year result 2007:
Strong economic expansion in the region produces a good result for SpareBank 1 Nord-Norge

Main features (amounts and percentages in brackets refer to 2006):
  • A very good result
    • Pre-tax operating result: NOK 459 million (NOK 377 million)
    • After-tax return on equity capital:  19.9 per cent (18.3%)
    • Earnings per PCC (Primary Capital Certificate):  NOK11.93 (NOK 8.46)
  • A very good result for SpareBank 1 Gruppen AS.  The Bank's share of the company's result amounts to NOK 116 million (NOK 69 million).
  • Overall cost ratio:  50.1 per cent (54.8%)
  • Low losses on loans:  Net losses of NOK 7 million (a gain of NOK 5 million)
  • Aggregate revenue generation from financial investments:  NOK 139 million (NOK 61 million)
  • Lending growth during the last 12 months (including loans transferred to SpareBank 1 Boligkreditt):  13.0 per cent (10.3%). The accounts show a lending growth during the last 12 months of 9.3 per cent.
  • Deposit growth during the last 12 months:  14.4 per cent (11.2%)
  • Deposit coverage ratio:  67.7 per cent (64.7%)
SpareBank 1 Nord-Norge's pre-tax operating result for the first half of 2007 totalled NOK 459 million profit, up by NOK 82 million on the corresponding interim period last year.  "We have been enjoying another half-year of strong economic expansion in our region.  Industry and commerce as well as private households are experiencing good times;  for the Bank, this is reflected in good results," says Hans Olav Karde, Chief Executive Officer of SpareBank 1 Nord-Norge.
There is no doubt that everything is going well in Nord-Norge.  Our customers borrow more and also deposit more money in the Bank.  Deposits were up by 14.4 per cent during the last 12 months, whereas lending growth was 13 per cent.
Very good growth within the retail banking market
"There are clear signal of high activity levels.  Customers borrow for new investments and, at the same time, increased levels of income coupled with higher rates of return on investments are producing growth in deposits," continues Karde.
Growth within the Bank's retail banking sector has been good, loans and deposits having risen by 13 and 8.6 per cent respectively.
Very good further progress within the corporate and public entities sectors
Targeted efforts directed at corporate- and public sector customers have been producing good results.  During the course of the last six months, SpareBank 1 Nord-Norge has notched up several wins in competitive tendering situations, having captured a number of new clients, including the two large city municipalities Alta and Tromsoe.  The Bank already had Helse Nord (Northern Norway Regional Health Authority) and the three county municipalities on its customer list.  The Bank's lending to corporate and public sector clients was up by 12.9 per cent during the interim period currently under review, whereas deposits from these two sectors increased by 20.9 per cent.
"The good growth within the retail banking-, corporate- and public entities sectors shows that we are competitive and that we are able to provide good solutions for all types of customers in our market, " concludes Karde.
Profit contribution from SpareBank 1 Gruppen
SpareBank 1 Nord-Norge has also received a substantial contribution to its overall profits from SpareBank 1 Gruppen, owned by the Bank and the other member banks in the SpareBank 1 alliance.  The Bank's share of SpareBank 1 Gruppen's result amounted to NOK 116 million, up by NOK 47 million on the corresponding interim period last year.
The main Board of Directors is very pleased with the result for the first half of 2007.  Every effort will continue to be made in order to further boost the Group's revenue generation and to achieve more cost-effective operations.
More details relating to the Group's operations can be found in the attached reports.
Any questions in this connection should be directed to Hans Olav Karde, Chief Executive Officer, telephone number: +47 77 62 24 01, or Oddmund Aasen, Deputy Chief Executive Officer, telephone number: +47 77 62 20 94.  We would also refer to the Bank's home page:
Some brief background information on SpareBank 1 Nord-Norge
SpareBank 1 Nord-Norge is a leading provider of financial products and services to the retail banking- and corporate markets and to the public sector in the region.  The Bank has an aggregate customer base of some 245,000 retail banking customers, about 40,500 corporate customers, including public sector entities, clubs and associations, and approximately 98,000 insurance product customers.  The Bank has 83 branches in Finnmark, Troms, Nordland and on Svalbard (Spitzbergen).
Tromsø, 7 August 2007
For and on behalf of SpareBank 1 Nord-Norge
Leif-Arne Kristiansen
Manager, Information and Public Relations

About Us

SpareBank 1 Nord-Norge is a leading provider of financial products and services in North-Norway. In addition to loans, deposits and payment transmission services, this also comprises most other savings products, as well as life- and non-life insurance products. Services and products are made available either by the bank and its subsidiaries, or through SpareBank 1 Gruppen AS's product companies.