SpareBank 1 Ostlandet

Good morning, everyone watching me on the screen today. It's a very nice autumn day, and I look forward to presenting the talks for the third quarter, Sparbanken Østlandet, together with Finance Director Geregel Bolstad. So let's jump right into the facts. There is a quarter that we are backing up with a good return. 13.5% on the one-capital return, which we think is good in this quarter, which has also affected some high losses. And there is a strong contribution from all income lines. And if I draw up something, it's the interest rate net. It is up 3% from last quarter, and 4.4% from last quarter, including provisions for the housing credit company. So there is a good development in the rent net, and we are very happy about that. And it is due to good growth, especially within the personal market. We are up 5.2% on outlay in the personal market, and despite strong competition, we have taken market share in all our regions. On the business side, it is a more stable development and a moderate activity level. The division works very well with broad sales. It goes from insurance, savings, pensions, to currency and interest, so there are also good contributions to the business market. Broad income is up 7%, and I have to add two data sources today. Finans Østlandet has up 16% year-to-date, and the income-savings, which was merged on May 1st this year, is up 58% net result from the same time last year. So there is good development also on the salary side. Financial positions and costs will usually come back, also at a loss. But in total, a net income of 2.19, up from 2.17 last quarter, we are very pleased with. We have seen the financial targets as this version since August last year. And we deliver well the first nine months of 2025. We are at 14.1% per capita, and we have an exchange rate that has exceeded our target of 50%, and we have a solidity that is strong. We are ready for growth, and we want to put the capital to work. And there is a macro picture now that in the Baltic countries, after quite a long time where there has been less optimism in the Baltic countries, it is now on the path of improvement. So there are still some industries that may not be completely recovered. The construction industry, for example, the interest-sensitive sector, there are still a lot of customers who are suffering. At the same time, we see that unemployment and contests are currently at the same level as in 2019, so it has become quite stable around that level, which was before the pandemic. And used housing. I mentioned that Einholdsmegle 1 Østlander is doing very well, and it is primarily due to used housing sales, which is good overall. And we can see that in the red line at the bottom of the graph, that there is a good turnover of used housing, although the new housing market is still quite calm. So, the personal market. The name of the used-volume market, the name of the income indicators, has talked about growth. There is no doubt that it is also important to work with broad incomes here. We are really good at insurance, savings and pension products also for the personal market. And if there is one thing I would like to point out, then it is also first-time buyers. We see that we are good at making progress, so our combination of good digital solutions and physical location management, and really good advisors, and at least quick treatment and competitive conditions, is to create growth for us. So we are very pleased with that, especially given that we are in a demographic, or an area that is in strong competition, and it is perhaps the region that is most attractive to many. The business market mentioned that there is a moderate activity level. Some customers are still sitting on the fence and waiting to start exciting projects, just to see how the rent development is going, and before they start new large initiatives. At the same time, it is a good pipeline, as I have said before, and we see that it is still there. We will see which materializes in payments and activity, but also here, as mentioned, it is good with broad revenues. So the growth is stable. We can see that all over Norway. The business market is a bit up and running, but it is not completely fresh everywhere. But we are really focused on the collaboration in the financial sector. We believe that one of our really important areas of investment in the future is that we will take even more advantage of the fact that we are a financial sector, with both banking services for large and small companies and personal customers, and at least capital markets, insurance, mortgages and real estate services. So we are a full-scale financial sector that we want to take even more advantage of in the future. Because in the future, we know that the interest rate level will become more demanding. So we have to work with many dimensions to be able to have a long-term loan of over 13%. We have to work with that in several axes. And if you look at the levers we have to pull in, it is to work with, it is that with good balance management, that optimal capital structure is important. So we want to put the capital to work, either through growth organically, maybe structurally, or pay back in installments to the owner, so that we have the right balance. That is important. Customer focus will continue to be the top star for us. We are a hotel for customers, so working with and attracting customers, and at least having even more attractive offers to customers, is very important. Working with the revenue side is something that has focus in the future, but at the same time it must also be balanced with working with internal efficiency. Costs will be a focus area for us in the new strategy period that starts in 2026. We are also planning to set up cost goals and clear expectations, but not only that. We must also set up plans and examples of measures that we will take in order to actually reach the goals we will set. So that will come in Q4 at the beginning of 2026. And Finanshuset does the same. We invest for the future. 2025 is an investment year. We have made a number of measures to simplify operations and absorb quite a lot more traffic than we did just a year ago through more operational efficiency. We have redesigned customer journeys and we are fast on the ball and we know we can put a price on it. In addition, we modernize around us, both the organization and the way we work. At the same time, we know that there are a number of investments that will hit our costs this year and next year. The second version is an estimate of around 150 million kroner for next year. By the first half of 2026, we expect that most of the costs there will be taken, and most of it will come in connection with a technical version. At the same time, we are aware that the second version will also be an investment in customer growth. We have established a customer center in Jøvik. We did that in May. That is the ambition over the course of the year. We also have a regional center that we have developed in Jøvik. These are investments that are in line with what we have promised in the fusion plan. The portfolio is developing well. Employees are satisfied. We have a good growth and traction on the international side of the country. Process simplification, I mentioned. We have to make it more effective in the future, and we have invested in a number of resources in 2025 that can help us develop this. Developers who, together with the Allianz resources that we have very good use of, and more value for us to work together with Allianz, is also to develop something that is important for our differentiation, but also process simplifications, so that we can make time for the customer advisors even more than before. We have also worked with economic criminality and the collection of resources to get even better processes and routines. There is more to be done here and in the future, but there is no doubt that I think we have come a long way in a year. We mentioned in March that we are collecting energy. We are also very happy to see that it gives effects, and we see that there is a good growth in revenue from private banking. And then I would like to mention Drammen. In October this year, we had a one-year anniversary in Drammen after being out for 24 years. And it's going very well. We had a goal, a loan goal on the personal market at a certain level after one year. We achieved that after ten months. And here there is good growth both in the personal market, the business market, and we are opening two new major offices in the course of a relatively short time, both in Drammen and Lier. That's the plan. And it is important for us to be a bank for both small and large companies, and to be local. We have great locations down at Bragernes Torg, and we are busy being a local bank in the Drammens area for both small and large companies. So I am very pleased that this investment is going better than expected. Then I would like to mention one thing that is important to us. We have an LO relationship that is more than 100 years old. LO is a strong owner. They are a large investor, and many of LO's members are customers with us. In the third quarter, around two thirds of the rent on the board market was actually LO members. And in addition, we see that the number of new sales, both in Oppland, which has come up really well with LO members, and at least new sales to young housing buyers, has grown well. So we have a strong and good relationship with LO, which we want to manage well. So there are some who can ask themselves, is this agreement profitable for us? Because there are pressure margins. Well, profitability comes in scale and broad revenues, and the fact that we now through this relationship also creates a loyal, satisfied customer. L&O customers, L&O members, they typically buy several services and are also very loyal. And if it is something that is important to satisfy customers, then it is that customers are loyal and feel a trust in the bank. And I am very proud that in the last year we have moved up on these customer satisfaction measurements. I can mention that in the business market we also have very high customer satisfaction. The combination of permanent contact persons, business centers and good digital solutions is really the key when growth is going to increase in the business market. But what you see on the slide now is related to the personal market, and we have moved up from 14th place to 7th place on the EPSI Customer Satisfaction Index this autumn. I am really proud of that, and that is due to the really good customer management of our employees. We are actually one of the best of the big banks, which we are also very proud of. And then we look at the quality elements. When you ask the customer what they are not satisfied with, it is all from the digital bank to the right information at the right time, and at least the service setting is also good. And the fact that we are a local supporter means a lot to our customers, that we are local to the place, and we will continue with that. Strong customer relationships are important. We know that creating good customers who like us is about creating a profitable bank in the future. So, before I hand over the floor to Ger Egil, who will go a little deeper into the conversation for the third quarter, I would like to remind you of our vision. Together we will develop Østlandet. We will be a locally and regionally anchored savings bank that is there for the local environment where we are. We are there at more than 40 locations around Østlandet. Østlandet is growing. It can grow both geographically and in size. It can also grow structurally. If it is right for us, we will explore those opportunities. But we are going to be there in Østland, because we are the ones who know Østland. We have 180 years of experience with this geographical area and with the customers here, and we think that we are definitely the best alternative for customers who need financial services. And the trust we are now seeing that we are getting, we are going to manage really well in the future. So then, the overlapped word, TG Regels, will go through our talks in more detail. Here you go.

All together. We forgot to set up what we usually do on the front page. Of course, there are opportunities to send in questions. You can do that on the e-mail address investor at sb1oslame.no. Bjørn-Erik Horskav, our investor contact, is live and will be able to play afterwards. Before I start talking about the figures, I would like to point out that most of what you see is pro-forma figures, to be able to have comparable figures from the period before the merger with Toten Sparbank last year. Let's start with a brief overview. Klara Lise is focusing on a very nice growth in revenue. One is compared to last quarter, but it's also compared to the corresponding quarter last year. It is important to show these images to highlight some of the one-off effects that are important for the comparison. On the left side, you have the comparison with the previous quarter, and it looks good with the cost development. that last quarter we had 40 million booked for the METIETO-Evri trial, and we also had higher fusion costs last quarter. So the loss costs are high this quarter, but we should also bear in mind that when the change from last quarter looks like, we had zero losses in the previous quarter. Compared to the corresponding period last year, it is worth noting that in the third quarter of last year, we had a profit of 287 million from the fusion between the future AICA insurance. If you look through the figures, you will see that there is a very pleasant income growth, but we also have a growth in costs that we will come to. Rente-netto. Klara Lise took most of the points here, but it is worth noting that there is a good underlying growth in net income. The margin is up from last quarter. There is a certain appreciation of the rent changes behind this, in addition to good volume growth, especially on PM. There is also a point here that the provision revenues from housing loans are down from last quarter. This is because the deductible interest in housing loans in particular depends on the level of decline we have seen, while we have repriced our housing loans, which had an effect from the end of August. This is an explanation for the fact that there is a certain difference in development in the quarter in net income revenues compared to the provision revenues from credit companies. Provision revenues are the strongest third quarter we have ever presented. It is 7% compared to the corresponding period last year, and it is a point to compare with the corresponding period last year. Here there are some cyclical elements. There is also a point that this is not something that has been only last year. We are up 17% compared to the previous quarter, two years ago. So it is a pleasant development over time that shows the cross-hull model in practice. To go into some of the individual elements, typically in the third quarter, good contributions from credit cards and payments, you can see that year by year. Also this year, the insurance provision is greatly increasing, and it is now approaching 100 million in the quarter. It is a high amount that contributes well. It should be noted that injury insurance in particular is up 39% from the corresponding period last year. It is an essential part of our delivery to customers, which is very well received. Under this, there are good profitability provisions, but there is also a very good sales activity level. The fund provisions are a bit unexpected. Here is a technical case with communication provisions that have gone from quarterly settlement to now being done twice a year. So here we expect that something will come up again in the fourth quarter. We have been talking about debt collection. Of course, the third quarter is a bit lower than the second quarter. The second quarter is normally the best, but it is 10% up from the corresponding quarter last year. That is very happy. Revenue services are about the same level as the third quarter last year. It is a bit down from the second quarter this year in seasonal effects that reflect the customer's needs. And the rest of the provisions and other income, it develops reasonably flat and completely OK on the level. The results from the tax authorities. We were able to scroll through the tax authorities and it is definitely in place. To go a little more in detail, it is the case that in the Finans Østland there is a good increase in the net income. It is a reduction in losses. And there it is also the case that the costs are at the level of the corresponding quarter last year. Very good development there. Totens Boligkredit is the last quarter, as you can see. The company is empty. All permits have been received, so it will be completed during this quarter. Megleren delivers a good quarter, and it must be allowed to say that it is an all-time high for the coming year, unless something special were to happen in the fourth quarter. When it comes to business partners, it is a weaker quarter than the previous one. It is on the income activity level. But it is worth mentioning that so far this year, the result after tax is 5 million. That is up from 2 million year to date last year. You have probably heard from our colleagues in the Alliance about the very good development in the Sparbankengruppen and the results there. Fremtiden is a strong driver in insurance. They have done a good job. The damage percentage has been low. They have also worked with price adjustment on the premium side. Also nice this quarter is that there are good and better results in Kredi Nord than what we have seen in the corresponding periods in the previous years. Other companies are relatively stable in the development. I would like to comment a little on Sparbank Hjem Boligkredit. It is a result jump. It is something technical. There is a housing loan. A larger emission is made at the entrance to the third quarter. Minimum wages on housing loans increased. A larger capital contribution also means that you have, let's call it, non-rentable obligations that fund in a cheap way, so the net income has increased. We also see that the loss costs are reduced. In addition, it is a positive contribution from finance. On the other hand, there is good development in the other companies. And if you take a look at the right side here, and look at the timeline, then you see that, okay, look away from what was called one-off in the third quarter last year, then we see that there is a good underlying trend in contributions from joint companies. It is an increasingly important part of the income picture in the bank. Then I have commented on the largest post here, which is the joint estate. The third quarter is not typically an exchange quarter, so there is zero. When it comes to the rest of the finance, it is worth pointing out that in that is the bank's own interest, currency and brokerage, which contributes between 15 and 20 million, quite stable in the quarter. It was at 16 or 17 this quarter. Moreover, there are good contributions to the spread of the liquidity portfolio, In addition, there is also a deficit and a fixed rent without a loan with insurance. Let's comment on operating costs. The overview of the picture is that at the corporate level, the development is quite flat from the previous quarter, but below that is what I mentioned at the beginning. We had 40 million NOK in the last quarter, and you can also see here that the fusion costs are down by 14 million NOK. So on an underlying basis, it is flat. But at the same time, we have been aware that there is a slightly lower level of activity in the brokerage, so that the staff costs, even if they develop quite steadily, also have a lower provision salary for the brokerage, so that we have an underlying growth in the staff costs. I would also like to comment on the operating costs for fixed property. We recently co-ordinated our offices in Eidsvoll municipality in Råholt. We have spent crowns on that. It could have been thought that we would have spent 3-4 million there and classified it as fusion costs. But then we are also clearly as strong as the largest bank in Eidsvoll. Moreover, some projects have been periodized into this quarter, so the operating costs are unusually high on fixed income, as you can see compared to the previous quarter and the previous quarter last year. The fusion costs, as I mentioned, will come more after next year, especially related to technical fusion. The operating costs are down, and it was about the same level as last year, perhaps a bit down. It is worth mentioning that the costs have been reduced. It is a mire that rips the banking industry apart. It is nice that it is lower this quarter. We will also mention that the share costs are lower from last quarter. It was also mentioned that we have established our own customer centre in Gjøvik. We have also taken back business from a joint customer centre in Sparbank 1.0 Alliance. We are down about 4 million from last quarter. on costs to the joint customer center. So some of what we build up and draw personnel costs on, you can also see that it is then drawn down on costs elsewhere. And collectively, we think, gives a more consistent experience for customers, as well as good control of the burden internally in the bank. So, to look at the operating costs here, I was talking about, for example, that Finans Østlandet has flat costs. You can see here that when you compare with the corresponding quarter, Last year, it was Morebanken where the costs went up. There is also an increase in costs, about a third of which is linked to the property effects I mentioned on the previous page. But nevertheless, we are aware that there is a development and a fairly strong increase in costs that we have a focus on. So it's nice to see on the right side that the corporate cost percentage is 37% in the quarter and below 40% so far this year. But that is in a very large degree an effort for income. So there is a connection between costs and income. Income is a reflection of the investments we make. But it must be said that we are fully aware that even if we have a very reasonable cost percentage in the quarter and so far this year, costs are the focus. The cost of loss of the period is a little exaggeratedly commented. It is driven by a few known engagements with previous losses in the construction industry. You know it from Makro, you read about it in the newspapers, it is a industry that is suffering. This greatly affects the increase in individual losses in this quarter. If you go through the table, you can see that the business market is at 99 million, which really drives the cost in this quarter. The financial state is on a normal level. The GDP is perhaps slightly higher than we are used to. At the same time, there are also a few single commitments where individual investments are taken. I will come back to a later page that shows that the portfolio as such looks very good. To go down to something more technical, it may seem a bit strange that we have a significant return on model-wise, but that is directly linked to an engagement that has migrated from Trin 2 to Trin 3. This has increased on the drop assessments, so that you get a reduction in step 2, but it contributes to an increase in step 3. So you have a lot of the explanation there. The period's net observations, I don't know if I should say normal level, but it is at a level that we are used to seeing, and that is quite stable, underlying over time. As I have explained, it is worth noting that we have had a shift between Trin 2 and Trin 3. You can see an increase in sales in Trin 3, with an increase of about 120 million kroner. You can also see an increase of about 350 million kroner in volume in Trin 3, connected to the migration I was talking about. It's about looking behind. It's about observations to a large extent, it's about known commitments, and we treat them and work with them when they appear. Then we take a more macro perspective, and not call it customer and micro perspective. Portfolios like those in the bank look stable, and even marginally improved, one might say. Especially in PM, a reduction in customers with withdrawal statements, and we also see that PM security in cash is on its way down. The company's frame credits show to be on a level, as we have seen. There is some volatility quarter by quarter, but it is on a level. And the LTV development in the business sector is also sideways. So more systematically and at portfolio level, we don't see any dramatic development at all. So to get to the bottom of this, this is typically the conclusion and probably what brings the equation together a bit, the capital accounting. We know that it is reported a little differently. We have been through two quarters now with the implementation of CRR 3, and now from the third quarter new minimum weights on units, and it is especially the minimum weight on housing units that means something to us. We have had a reduction in the quarter to 1 percentage point. We guided there that the effect of new risk factors would be about 1.1%. There we landed on 0.8%. The other contribution to the change in pure core capital is that the contribution from the result after the calculation of the tax exchange in the period is positive, with 0.3%. It is also the case that this expected loss factor for IRB, compared to the loss assessments, contributes negatively, with 0.4% in the quarter. So we are now at 17.3 in the core, in relation to an established internal ambition at 16.1 and a government minimum wage at 15.1. So we see that this is a comfortable level, but as Klara-Lise was saying, it is a focus in our balance management. To sum up, it has been a good quarter in terms of income. We see that the costs are stabilised somewhat, but we are aware that the level is something we are working with and will continue to work with. We see that the loss line is higher than we like, but there are known commitments. All in all, we end up with a good growth and a self-sufficiency rate of 13.5, well above our ambition, and with a solid capital coverage. So with that, we open for questions from the room, and if there has been anything from the internet. I see that we have been a bit late with the e-mail, but there has not been anything from the internet. Is there anything from the room? I don't think so. Then I think that we thank you for participating, and we'll see you at the beginning of February for the fourth quarter and the previous year's budget. Thank you for now.