AURSKOG SPAREBANK (AURG) Q4 2023 earnings summary

Executive summary

• 2023 net income was NOK 214.5m, up from NOK 179.0m in 2022; return on equity was 11.0%, excluding interest on hybrid capital.

• Business capital, including loans distributed through Eika Boligkreditt, reached NOK 20.006bn, the first time above NOK 20bn.

• Growth in net interest income and investment income supported results; the adjusted cost ratio improved to 31.0%, excluding core banking conversion costs.

Financial highlights

• Net interest income was NOK 351.1m vs. NOK 274.6m in 2022; net interest margin relative to average assets was 2.15% vs. 1.85%.

• Total operating income was NOK 439.1m vs. NOK 353.3m; profit before tax was NOK 279.4m vs. NOK 232.3m.

• Net income was NOK 214.5m vs. NOK 179.0m; earnings per equity certificate were NOK 18.29 vs. NOK 15.05.

• Net impairment losses were NOK 8.4m, compared with a NOK 6.3m net impairment reversal in 2022.

• Extended income was NOK 31.3m vs. NOK 74.7m; total comprehensive income was NOK 245.8m vs. NOK 253.7m.

Outlook and guidance

• Management described the economic outlook as unsettled, with global and European uncertainty expected to continue weighing on markets and confidence.

• Customer requests for payment holidays rose moderately after rate increases; management said customers were contacting the bank early and loan quality remained good.

• Management reported strong local demand and new-customer interest, and intends to continue growing through customer engagement and local-market activity.

• Expected housing-market activity showed early signs of recovery, while the timing and strength of new-build activity remained uncertain.