At the end of October and beginning of November, the Bank Norwegian Group (BN Group) launched operations in Spain and Germany with the Bank’s product mix; installment loans, credit cards and savings accounts, simultaneously. The expansion follows the same operating model as in BN Group’s Nordics with cross-border operations from BN Group’s headquarters in Norway. The launch was carried out according to plans and expectations, and in accordance with the principle of reusing a large part of the infrastructure while inventing new solutions, where necessary, on euro payments and customer identification.
The acquisition of Bank Norwegian ASA by Nordax Bank AB (publ) was completed on November 2, 2021. A new board of directors was elected on November 8, 2021 at an extraordinary general meeting. Following the completion of the transaction, BN Group requested the delisting of Bank Norwegian from the Oslo stock exchange and the shares were delisted from November 15, 2021.
BN Group posted a profit after tax of NOK 159.7 million in the fourth quarter, compared to NOK 276.1 million in the third quarter and down from NOK 436.2 million in the same quarter last year . The sharp reduction compared to the previous quarter is due to high non-recurring administrative costs related to financial advisors’ fees in connection with the Nordax offer, of approximately NOK 174 million in the fourth quarter and lower interest income due to sales of portfolios during the previous quarter and current quarter. The decrease was partially offset by the increase in net commission income during the quarter. Excluding one-time advisory fees related to the Nordax offer in the third and fourth quarters, return on equity was 11.3% and 10.5%, respectively.
Adjusted for the portfolio sale in Sweden during the quarter, currency adjusted loan growth was positive at NOK 498.7 million. Broken down by product, currency-adjusted loan growth for installment loans was NOK 406.2 million, adjusted for portfolio sales in Sweden, compared to NOK 21.4 million in the prior quarter, adjusted for portfolio sales in Norway and Denmark. The growth came mainly from increased new sales, particularly in Finland. Currency-adjusted loan growth for credit cards was NOK 92.5 million, compared to NOK 256.0 million in the previous quarter, adjusted for the sale of the wallet in Norway during this quarter. Installment loans amounted to NOK 26,755 million and credit card loans to NOK 10,191 million as of December 31, 2021.
Stage 3 loans amounted to NOK 7,261 million at the end of the year, compared to NOK 7,907 million at the end of the third quarter and NOK 10,146 at the end of December 2020. The development in 2021 was in line with expectations and the reduction is due to the five sales of non-performing portfolio loans during the year, with a total effect of gross phase 3 loan reduction of approximately NOK 4,435 million. Stage 3 loans represent 19.7% of gross loans, compared to 21.0% at September 30, 2021 and down from 23.7% at the end of December 2020.
Customer deposits amounted to NOK 36,394 million at the end of the fourth quarter. Currency-adjusted deposit growth amounted to NOK -1,375 million compared to NOK -870.0 million in the previous quarter. As in previous quarters, Norway continues to be the main source of the decline in deposits, with a reduction of NOK 1,095 million in the quarter.
Total capital ratio was 28.6%, Tier 1 capital ratio was 26.6% and CET1 ratio was 25.5% including 59.9% set aside of earnings net dividend for 2021, well above our internal CET1 target (including Pillar 2 guidance and management buffer) of 17.7% at 31.12.2021. In the fourth quarter, a dividend of NOK 1 per share was paid, for a total of NOK 187 million, as approved by the April 2021 AGM, linked to 2020 net profits.
Based on capital strength and financial position, the Board of Directors of Bank Norwegian ASA is proposing a dividend of NOK 3.85 per share, totaling NOK 719.6 million, and NOK 513.9 million are added to retained earnings.
“Bank Norwegian had two strategic objectives for the year 2021, as stated on Capital Markets Day in March 2021. The first was to enter one or two new countries at the end of 2021, and we managed to enter Spain and in Germany in 2021. The second strategic objective of the year was to strengthen our Nordic champion position, which we are constantly working on, now also improving our position in Sweden with Nordax. We sold five non-performing loan portfolios in the Nordics, for a total of NOK 4,435 million, significantly improving credit quality and key indicators of remaining balances,” said CEO and CFO Klara-Lise Aasen .
For more information, see the full reporting documents for the quarter at: https://www.banknorwegian.no/OmOss/InvestorRelations
For any questions, please contact:
CEO and CFO, Klara-Lise Aasen; phone: +47 47635583; Email: [email protected]
head of the Treasury, Mats Benserud; phone: +47 95891539; Email: [email protected]
Press contacts; Head of Communications and Sustainability, Melita Ringvold; phone +47 95121983; Email: [email protected]
This information is subject to the disclosure requirements in accordance with section 5-12 of the Norwegian Securities Act.
Fourth Quarter Report 2021 Bank Norwegian Group