Hoist Finance (HOFI) investor relations material

Strategic update and future ambitions

• Raised portfolio growth ambition to SEK 60 billion by 2030, targeting a 15% CAGR from SEK 39 billion in 2026, with a focus on profitability and operational leverage over pure volume growth.

• New financial targets: minimum 20% ROE (up from 15%), 15% annual EPS growth, CET1 buffer of 2.3–3.3% above regulatory requirements, and increased dividend payout ratio to 30–40% from 2027.

• Four growth pillars: expand in existing markets/asset classes, selective geographic expansion in Europe, SME segment focus, and selective M&A for accretive portfolios.

• Operational leverage to be enhanced by keeping indirect costs flat, leveraging scale, and maintaining a flexible operating model with a mix of in-house and outsourced collections.

• Expansion into new markets since 2023, including Sweden, Portugal, Finland, and Hungary, with prudent entry and scaling upon proven collections.

Financial targets and guidance

• ROE target set at >20%, EPS growth at 15% p.a., CET1 capital ratio 2.3–3.3% above requirements, and dividend payout 30–40% from 2027.

• Achieved SEK 39 billion portfolio by Q2 2026, ahead of previous target.

• Dividend policy updated to 30–40% of annual net profit from 2027, up from 25–30%.

• CET1 capital ratio at 13.03% as of June 2026, maintaining a robust capital position.

• Four key financial targets: ROE >20%, EPS growth 15% p.a., CET1 buffer 2.3–3.3%, and dividend payout 30–40%.

Market and regulatory environment

• European NPL market remains deep (~EUR 400–406 billion), with banks selling fresher portfolios due to regulatory backstop and provisioning rules.

• Regulatory changes (prudential backstop, NPL Directive) have accelerated NPL sales and reduced the gap between seller and buyer valuations.

• Market is shifting from large, infrequent disposals to recurring, smaller ticket sales, favoring platforms with granular, diversified capabilities.

• SME NPLs are a growing opportunity, now 17% of the book, with further expansion expected, especially after the Azzurro Associates acquisition.

• Largest NPL stocks concentrated in France, Spain, Germany, and Italy, with a shift towards northern Europe.