"The result has been adversely affected by the global financial crisis, bringing about losses on financial investments," explains Hans Olav Karde, SpareBank 1 Nord-Norge's Chief Executive Officer.

 

The accounts show that the underlying banking operations continue to do well.  Before losses, the Bank earned NOK 555 million, which is NOK 47 million better than at the same time last year.

 

In spite of the losses on financial investments, SpareBank 1 Nord-Norge remains a very strong bank.  Although the global financial crisis continued during the third quarter of 2008, the Bank's access to funding has been satisfactory throughout the period.  At the end of the third quarter this year, the overall deposit coverage ratio was 63.8 per cent, up from 61.9 per cent 12 months ago.

 

"We are well placed to tackle the impact of the turbulence in the global financial markets.  This is confirmed by our recent participation in the acquisition of Glitnir Bank together with the other member banks of the SpareBank 1 alliance, and by the fact that we were able to do this without having to raise new capital," says Karde.

 

• Pre-tax operating result totalled NOK 375 million (NOK 636 million)
  • After-tax return on equity capital amounted to 7.8 per cent (17.4%).
  • Earnings per Primary Capital Certificate (PCC), Parent Bank, NOK 5.56 (NOK 7.28)
• The underlying banking operations remain very good; the result from core operations before credit losses amounted to NOK 555 million (NOK 508 million).
• A reclassification of large parts of the Bank's interest-bearing portfolio in the trading portfolio has been made as at 01.07.08 from the category 'Market value through the profit and loss account' to the categories at amortized cost method.
• Further losses on financial investments in the last quarter, amounting to NOK 56 million;  so far this year, losses total NOK 111 million (a gain of NOK 137 millon).
• Overall cost development under control - a 1.1 per cent increase in costs compared to 2007
• Losses on loans:  Net losses of NOK 69 million (NOK 9 million).
• Lending growth during the last 12 months (including loans transferred to SpareBank 1 Boligkreditt):  8.5% (11.4%).
  • Retail banking market 8.9 per cent (incl. Boligkreditt).
  • Corporate market 7.7 per cent.
• The accounts show 3.0 per cent lending growth for the last 12 months (9.3%).
• Deposit growth during the last 12 months amounted to 6.1 per cent (9.0%).
• Overall deposit coverage ratio:  63.8 per cent (61.9%).
• The Bank has good financial strength and continues to have satisfactory liquidity.

More detailed information about the Group's operations will 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.  Reference is also made to the Bank's home page on the Internet:  www.snn.no

 

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 244,000 retail banking customers, about 36,500 corporate customers, including public sector entities, clubs and associations, and approximately 101,000 insurance product customers.  The Bank has 81 branches in Finnmark, Troms, Nordland and on Svalbard (Spitzbergen).  SpareBank 1 Nord-Norge has its own representative office in Murmansk and is a shareholder in the Russian bank, Tavrichesky OJSC, whose head office is located in St. Petersburg.