SPAREBANK 1 HELGELAND (HELG) Q1 2025 earnings summary

Executive summary

• Pre-tax profit for Q1 2025 was NOK 190 million, up from NOK 179 million year-over-year, driven by higher financial investment income and lower loan losses, despite lower net interest and commission income.

• Net interest income declined to NOK 236 million, down NOK 18 million sequentially, mainly due to reduced deposit margins and lower corporate lending.

• Cost/income ratio improved to 32.7% (or 33.6%), with stable operating expenses well below the 40% target.

• Loan losses decreased to NOK 19 million from NOK 26 million in the previous quarter.

• Strategic increase in ownership in SamSpar entities, strengthening future income and aligning ownership with bank size.

Financial highlights

• Net profit for the period was NOK 154 million, up from NOK 144 million in Q1 2024.

• Total assets under management at NOK 39.0 billion, up from NOK 37.4 billion year-over-year.

• Net commission and other income at NOK 41 million, down NOK 8 million sequentially.

• Dividend income from product and alliance companies totaled NOK 32 million in the quarter.

• Net financial items contributed NOK 37 million, up NOK 30 million from the previous quarter.

Outlook and guidance

• Expectation of increased business activity in Helgeland and continued credit growth in the personal market.

• Anticipate further reduction in net interest margin into 2025 due to competition and higher funding costs.

• Stable commission income and operating costs projected to remain well within the 40% cost/income target.

• Loan losses expected to decline in 2025 compared to 2023 and 2024.

• Long-term profitability target remains at 12% after tax.