SpareBank 1 Nord-Norge - first quarter report and accounts 2008: Good banking operations despite impact of unsettled international financial markets
SpareBank 1 Nord-Norge's core banking operations did well during the first quarter of the year, but the overall result shows that Nord-Norge too is affected by the unsettled international financial markets.
The Bank's pre-tax operating result finished up at NOK 66 million, as against NOK 222 million at the same time last year.
"The figures for the first quarter show that good, core banking operations generated NOK 157 million revenues, unchanged from the first quarter last year. Unrealised losses on the Bank's stock- and bond portfolio reduced the operating result, which shows that the unsettled international financial markets are having an impact on our result too," says Hans Olav Karde, Chief Executive Officer of SpareBank 1 Nord-Norge.
He emphasises that price fluctuations in the securities market will always be a factor which has to be taken into consideration by a financial institution, irrespective of the Bank's core banking operations.
"In spite of the turbulence affecting financial markets internationally, we are still able to enjoy good loan- and deposit growth, coupled with low credit losses and a low level of non-performing commitments. We have also seen a NOK 60 million shrinkage in net non-performing and impaired commitments compared with the corresponding interim period last year," Karde explains.
Main features of the first quarter of 2008 (amounts and percentages in brackets refer to 2007):
- Pre-tax operating result: NOK 66 million (NOK 222 million)
- After-tax return on equity capital: 3.6 per cent (19.1%)
- Earnings per PCC (Primary Capital Certificate) so far this year (Parent Bank): NOK 2.58 (NOK 3.74)
- The underlying banking operations continued to do very well; a NOK 157 million (unchanged from last year) result from core banking operations before credit losses
- Financial investments made a loss of NOK 88 million (a NOK 67 million profit)
- A reduced contribution to the Bank's overall result from SpareBank 1 Gruppen AS. The Bank's share of the company's result amounted to NOK 19 million (NOK 48 million).
- Unrealised loss on the Bank's share portfolio amounted to NOK 55 million.
- Unrealised loss on the Bank's interest-bearing portfolio amounted to NOK 69 million.
- Gains from foreign exchange and financial derivatives and assets totalled NOK 9 million.
- Low losses on loans: Net losses of NOK 3 million (NOK 2 million)
- Lending growth during the last 12 months (including loans transferred to SpareBank 1 Boligkreditt): 11.0 per cent (12.4%)
- Retail banking market: 12.1 % (including SpareBank 1 Boligkreditt)
- Corporate market: 8.9 per cent
- Deposit growth during the last 12 months: 7.3 per cent (13.6%)
- Deposit coverage ratio: 62.4 per cent (60.8%)
More detailed information 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: 77 62 24 01, or Oddmund Aasen, Deputy Chief Executive Officer, telephone number: 77 62 20 94. We would also refer to the Bank's home page: www.snn.com
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 100,000 insurance product customers. The Bank has 81 branches in Finnmark, Troms, Nordland and on Svalbard (Spitzbergen), and a representative office in Murmansk, Russia.
Tromso, 30 April 2008
For and on behalf of SpareBank 1 Nord-Norge
Kjell Kolbeinsen
Director, Information and Public Relations