Nordea Bank (NDA-SE) Q4 2024 earnings summary

Executive summary

• Achieved strong financial results for Q4 and full year 2024, with resilient profitability and growth despite geopolitical and economic uncertainties.

• Full year income increased by 3%, and return on equity reached 16.7% for the year and 14.3% in Q4.

• Strategic investments in technology, digitalization, and risk management have driven efficiencies and improved customer experience.

• Successfully completed the acquisition of Danske Bank's Norwegian personal customer and private banking business, adding 235,000 customers and EUR 9bn in lending.

• Operating profit grew 4% to EUR 1.5bn in Q4 and 3% to EUR 6.55bn for the full year.

Financial highlights

• Q4 total income up 1% year-on-year, driven by 8% growth in net fee and commission income and a 73% surge in net insurance result.

• Net interest income declined 5% year-on-year due to lower deposit margins and policy rates, partially offset by higher lending and deposit volumes.

• Cost-to-income ratio improved to 48.9% in Q4, down from 50.6% a year earlier.

• Net loan losses remained low at EUR 54m (6bp), well below the long-term average.

• Assets under management grew 11% year-on-year to EUR 422bn.

Outlook and guidance

• 2025 return on equity expected to remain above 15%.

• Cost-to-income ratio targeted at 44-46% for 2025; modest cost growth of 2–2.5% expected as investment pace stabilizes.

• Dividend payout ratio policy of 60-70% of annual profit; ongoing and planned share buy-back programs.

• Ongoing focus on organic growth and selective bolt-on acquisitions, especially in Norway, Sweden, and Denmark.

• Management buffer of 150bp above regulatory CET1 requirement maintained.