Norion Bank AB

Welcome to Norway Bank's Q2 report 2021. My name is Martin Åstman and I am the CEO. Let's start with page 2, which is a summary of the second quarter. The stock is now rising to 49.4 billion, which is an increase with 1.9 billion or 4%. The revenues go up to 948 million. The KU number ends at 29.9. This quarter it is mainly properties and private that are growing. We have started our resale program, have bought back a little over 2 million shares, corresponding to about 90 million of the total 500 million we have the mandate to buy back for. Revenue result, 475 million, increase of 14 cents. Dismantling of P&G capital amounts to 15.4 and then we have accumulated exactly 1.3 billion under the year. The capital generation Up to 6.5% and the core premium to 15.4%. Then we should also keep in mind that we make full deductions for our exciting resale program. The last box here in the picture, we will talk a little more in detail about that, but in June we implemented in Olli, our payments solution, a big step to grow our Nordic business, when we got the opportunity to acquire Verku Kaupas finansieringsverksamhet i Finland. Men som sagt vi återkom på det lite mer under avsnittet Volvo. Vi går till sidan tre och pratar lite företag. Företagssegmentet då, det vill säga företagskrediter och factoring. Ganska oförändrad stock mellan Q1 och Q2. Bra kvartal. especially for corporate credit in Sweden and factoring in Finland. That's really what stands out this quarter. Compared to Q2 2025 and Q2 2024, we can state that the stock is growing at more than 1 billion, an increase of 12%, while the revenues increase by 19% during the same period. So a very good development in general for for corporate. No major changes when we look at geographical split or different brands, not also regarding running time or average size per business. So very small changes there. So I think this is a very good quarter. This segment is something we have been focusing on in recent years. We have a very good position is to be able to offer financing solutions in the form of real estate, credit and manufacturing in the Nordic countries and then to medium-sized companies. That's what we're focusing on. Very exciting quarter. Let's take a look at this specific quarter. So good activity, a lot of customer dialogues. What we notice now is that it takes a little longer before the customers make decisions and actually carry out their business. So a little slower Q2 than we are used to. We also see some increased competition from major banks and the stock market, which is good that there is a market that works. So a little more competition, especially in Sweden, Norway, Finland is not really the same competition situation. Vi tittar lite på hur kunderna mår. Första halvåret, det här året, klart bättre. Det är glädjande att se att det är färre kunder som får utmaningar med att betala sina räntor eller amorteringar. Verksamheten de har går ganska bra. Så det är en klar förbättring i hur kunderna mår om man jämför första halvåret med första halvåret 2024. Det här halvåret 2025-2024. Så klara förbättringar. Gällande tullar och tullutspel från USA så upplever vi inte att våra befintliga kunder har något som påverkar deras verksamheter direkt. Så där ser vi inga tecken på att man påverkas. Vi kan gå till sidan fyra och så tittar vi på fastigheter. Det är här vi har en tillväxt. Även här a lot of activity, a lot of customer dialogues, a lot of pressure. The stocks are rising here with one billion between Q1 and Q2, especially Finland, which had a good business flow in the quarter. If we compare a little longer then Q2.25 with Q2.24, relatively unchanged stocks from 22.4 to 22.1, so a nice flat, but we are still increasing the revenues under the same threshold of 8%. In addition, there is nothing to worry about, whether it is geography or the average size of the business we do all the time. Very small changes, just like in the business segment. We look at page 5, a little more property. The percentage of senior loans increases. from 61 to 63. Juniors decrease from 39 to 37. LTVs, both seniors and juniors, unchanged, very unchanged from the previous quarter or Q1. A little about the market values, but the market values during this quarter, they decrease somewhere between 2 and 4 percent. That's where this quarter is. Step 2 and step 3, where we still have too high volumes and that's where we Vi lägger väldigt mycket fokus på att förbättra det och då ser vi goda förutsättningar att kunna fortsätta minska det under andra halvåret och det här kvartalet minskar vi steg 2 och steg 3 med 200 miljoner så att det går till rätt håll kvartal för kvartal. Vi tittar på privat sidan 6, ja men väldigt bra privat vi har jobbat quite a lot of years to share the credit in the private sector. I think quarter by quarter this will get better. It goes according to plan, maybe a little faster than we thought. We are increasing the stock between Q1 and Q2 by 750 million. If we exclude the acquisition we did, that is, when we bought DNB's Swedish credit card company, which is fully integrated now, we increase the stock by 100 to 120 million. It is a good and reasonable growth rate. Those of you who have been involved know that Lönsamhet är vårt prio och gärna lönsam tillväxt men det här går precis som vi vill och som sagt kanske lite bättre än vad vi förväntade oss när vi ställde om den här affären för ett antal år sedan. When we were doing this presentation about Q1, we also said that a little decrease in the demand for private loans. It actually started already in January, at the beginning of Q1. But if we look at this quarter Q2, we see a clear increase in demand for private loans and a fairly favorable competition situation. So this is a good quarter for private. Compared to this quarter compared to the quarter last year, the stock increased by 9% and the revenue increased by 19%, so a nice development. We are still working intensively to drive flow in our own channel. When we started this transition, we had somewhere between 2-5% of flow in our own channel, and now we have almost 50% in separate months. This is a very good development. This means that we can create a better risk-based discount. It will also mean lower credit losses and a longer duration in the stock. Then also very happy that we have now increased the proportion of cards to have 95,000 cards. We have a critical mass, we have a a system that allows us to continue to grow our short-term business on our home markets, and Norway and Sweden were the first to come. So now we actually have a short-term business that is worth the name. If we also look a little at how the customers are doing, it is still good, as we said in Q1. There are continuous improvements in the number of customers. There are fewer who face challenges in paying their rents and rents in general. It is still good quarter where of course fewer customers go to the cash register, so this is very positive news for our customers and us. So the private sector has had a very, very nice quarter. Last but not least, page 7, and we're talking about Wall-E, our payment solution. This is a great quarter for Wall-E. If we look at the second quarter of 2025, we have an increase of 23%. We have transaction volumes of over 5 billion. That is very good. We go from 400 to 5 billion in one year. June became the strongest month this year. We had over 1.7 billion in Transactionslund, då var det en ökning med drygt 30% jämfört med juni 24. Vi har 6 miljoner aktiva kunder. För ett år sedan hade vi 5 miljoner så det är en fantastisk utveckling. Det här fortsätter också vara ett affärsområde som är lönsamt och som drar väldigt lite eget kapital. Om vi tittar på hela första halvåret så kan vi konstatera Wallis transactions volumes increased by 25% and we go from 7.6 billion to 9.5 billion. So this is great, we have very good momentum in Wallis. This quarter, a few collaborations that are worth mentioning, I think. We have gone live with a few major traders, Claes Olsson, Teknikmagasinet, Lager 157. Very nice that so many think we have a good product, which we also think we have. We have a very good position. Vi gör en del satsningar, det har vi gjort ett par kvartal inom Wall-E. Vi vill fortsätta utveckla produkten, så vi lägger ner fokus på produktutveckling. Vi fokuserar också på att ha fler kundansvariga, så vi lägger en del pengar och satsar på Wall-E. Det har vi gjort, och vi fortsätter göra det det här kvartalet. Titta på sidan åtta, och det jag nämnde i början, Verkekaupa. It's a pretty big step for us to grow our Nordic payment business. We have been given the opportunity to acquire Verkekaupa's financing business in Finland. Verkekaupa is En av Finlands absolutt största e-handlare. Det här omfattar 90 000 kunder. Vi förvärvar en kreditportfölj på omkring 350 miljoner kronor. Så med den här affären så ökar vi rejält vår finska marknad och vi ökar Wallis stock med drygt 10% i det här. Så det är väldigt, väldigt bra. Och den här affären kommer vi att slänga under andra halvåret. That was it about that, and with that I'll hand it over to Peter to talk about some figures.

Thank you for that. I'll look at page 9 and start looking at the revenues. They go up to 978 million here during the second quarter. It is a good level and what stands out here during Q2 is that we as usual during the second quarter have a A positive season effect, it is in the range of 30-35 million. Now under Q2, it is exactly the same level as we saw even under Q2 2024. If we compare the income level with what we saw during the first quarter, we should remember that then we booked in 140 million extra in retroactive interest payments that have come, so that is again why that level rises during Q1. But the 978 million we see here during Q2 is at a very good level. Even the threshold is good, it goes up to 7.1% and this is in spite of, as Martin mentioned earlier, that we still have too high volumes in step 3 and the conservative way we handle revenue distribution there. Let's go to page 10 and take a look at the impact we have from the way to handle revenue distribution. As I said, we report a NIM at 7.1% here under Q2. If we had received fully paid from the three volumes we have, especially within the property segment, then the underlying number would have risen to 7.7%. That is to say, as you can see on the diagram on the bottom left, there are about 60 points that are missing on the number. If you look at it from a historical perspective, it has come down a bit from the top-notations that we saw. This is driven partly by slightly better payments, but also by the fact that we have lowered the Step 3 volumes and that we also have slightly lower housing rates, which means that there is less money that is missing from an income perspective. We go to page 11, we break down the name a little more in detail, and what is pleasing to see is that our funding costs continue to drop, and they are dropping significantly here now during the second quarter, we are backing up the band to Q2 2024, when we sat there and had the corresponding presentation, we said that we saw that the funding costs had had peaked, and it is clear when we see this graph that they gradually, during the past year, have actually also dropped. If we look ahead, we expect that they will continue to go down, but perhaps not really in the pace we have seen here, isolated during the second quarter. If we look at the index from a slightly longer perspective, it is interesting to note that the 7.1% that we have now, if we go back three years and look at how Q2 2022 looked like, we had a a NIM at 6.9%, so this is a proof that we have handled this rate cycle in a good way. We have a higher NIM now compared to what we had three years ago. And this again, despite the fact that we have too high volumes in step 3 and that, as I said on the previous page, that there are 60 points on the NIM that we do not make income from in that way. We go to page 12. Speaking of liquidity, we continue to strengthen our regulatory liquidity measures. We have an LCR that goes up to 373, a very strong and good level. The NSFR is also increasing, going up to 124% here now in Q2. It is increasing, but not really in the same pace as we have seen before. This is a completely conscious choice. We have made the big shift from the 103% that we were on when the financial inspection came with with its updated legal stance. So we should not expect that this level will increase forward, but rather that we want to be somewhere around 120 when we look forward. Then we go to page 13 and also look at the more structural liquidity position. Here you can see the proof of what I said on the previous page, that we under Q4 2024 and Q1 2025 made the big shift when we also not only worked with the structure and the sources of our liquidity, but we also took in a lot more liquidity. And that move has, so to speak, consciously stopped here now during the second quarter. But this move, translated into crowns and ears, means that we have taken in almost 9 billion in extra surplus liquidity. We have a weak negative carry on that surplus liquidity and even the NIM will be seen to be stable and good despite the fact that we have made this move. Since 2014, we start to look at our segment, we start with the business segment. Martin was actually talking about volume development, very small changes here now during the second quarter, the stock has risen to 11.2 billion. However, from a slightly longer perspective, we have seen volume increases that go up to 12% compared to Q2 2024. At the same time, the revenues have increased by 19%, so from a slightly longer perspective, a very nice development and also the NIMN is developing stably and well during this quarter. Since 2015, the property segment, the stock is up almost 1.1 billion. Worth noting here is In the graph on the right side you can see the big effect from the about 140 million in retroactive interest rates that were booked in during the first quarter. So that's what explains the shift in both interest rates and margins during Q1. On the other hand, if we look at the shift on the NIM, which we have done from 4.7% to the 5.4% that we are reporting here now under Q2, then that is partly driven by the lower funding costs that I talked about earlier, but also that we have received a little better income from the Step 3 commitment just during this quarter. By 2016, the private segment, as I said, the volumes are up with 750 million and of that is then about 650 million from the acquisition that we closed here early in April. according to DNB's Swedish war card business. So the underlying volume increase is then about 100 million. Martin mentioned it, it's a good pace, it's where we want to be, it's where we feel that we combine a certain growth with prioritizing a good profitability. If you look at the revenues on the right side, a good level, 304 million. This is where we see the absolute lion's share of the seasonal effect I mentioned earlier. And that's a total of about 30 to 35 million that comes in there. But it's again exactly at the same level as we saw during Q2 2024. The NIM is also good, up to 8.9%. The stock has developed well during the past year, up 9%. And during the corresponding period, the revenues are also up by 19%. So a very good development for our private sector. Page 17, Wally. As I said, strong development in transaction volumes. The stock is up with a little over 100 million here isolated during Q1. Over the past year, the loan stock is up by 7% and at the same time, as Martin mentioned earlier, a very strong development in transaction volumes. And the reason that the loan book is not increasing at the same pace is due to the fact that we have brought in a lot of new traders over the past year. And it is under an upgrade phase where certain lead times before the new traders we have brought in reach a certain maturity level. So one can say in general that Wall-E is in an investment phase with new traders. We are making investments. And we are convinced that this will give results in both revenue and profitability a little later here. But all in all, good development, good margins. We have very good profitability for Wally. Total revenue margin 17.8% and especially if you look at the relatively low capital intensity, the low capital binding that we have. within this business, it generates a very attractive and good return to the bank as a whole. Page 18, look at the costs, they go up to 292 million under the second quarter. This is an increase of almost 10% compared to the corresponding period last year. What has driven that increase in costs is partly a certain amount of movable costs. The stock is up 4%, but in addition to that, as I said earlier, we have also had a strong development for Wally, especially when it comes to transaction volumes, which also draws a lot of movable costs. In addition, we have noticed a certain inflation pressure. Even if the inflation has gone down, there is a certain delay in some of our costs. In addition, we continue to make bold investments in the organization. This applies to both central support functions that have to do with regulations and other things, but also those that I talked about earlier, investments in Wallet, which we believe will give good results later. But despite this development and the factors that drive this, we have a good cost control. We think we have a good number of COE that is just under 30%. On page 19, our net loss reserves go up to 214 million under Q2, with a level of 1.8%, which both in kronor and percentually is largely unchanged compared to the level we saw during the first quarter. From a slightly longer perspective, we have lowered the reserve level from 2.3% and credit loss level from 2.3% to 1.8%. And this is due to the fact that we see very good payment patterns, especially in our front book, especially if I talk about the private side, Martin was talking about it, we see better and better payment patterns, we see lower cash transfers, actually month by month during this past year. Despite this, we continue to reserve conservatively. We strengthen our reserve rates again. The reserve rate in step 3 private is now rising to 59.2%. And seen during the past year, it is an increase of almost 5%. If we look at the company and property side, then there are no major developments that drive carbon waste reservations during this quarter. Let's go to page 20. To sum it all up, a good level of income, still a good cost picture, an attractive KI number. According to the losses, still at 1.8%, which means that we get a turnover result of 472 million. That's 14% compared to the corresponding period previous year, so a very nice and good development there. We have a return on our own capital of 15.4% and this despite the fact that we have accumulated 1.3 billion in our own capital over the past year and in that figure we have bought back shares for 90 million kronor here under the second quarter. Page 21, our capital coverage position is still very strong. We have a core capital relation that goes up to 15.4. Total capital coverage at 16.5. This is a decrease compared to Q1 at about 70 points. Then we should remember that we make full withdrawals. for our entire resale program. This then negatively affects with about 90 points. That is, we have an underlying strengthening of the capital coverage at about 20 points. But 16.5 in total capital in relation to our total capital requirement of 13.2% gives a capital buffer of about 330 points. Det är strax över mittpunkten i det kapitalintervallet, det finansiella målet som vi har som bank satt en väldigt stark och bra nivå. Och det här ska också då ses i ljuset av att vi fortsatt har ett väldigt stort outnyttjat hybrilt kapitalutrymme som vi hoppas kunna utnyttja mer effektivt framåt. Går vi till sidan 22 så lämnar jag tillbaka till Martin igen.

Utmärkt, tack Petter. If we sum up the quarter, we'll look at the different segments. The business segment is still doing well. A lot of dialogue, a lot of interest. We're improving profitability over the year. Det är en del som har, vi har växt strategiskt att leverera finansiärslösningar till medelstora företag i Norden. Det fortsätter vi att göra så att det är väldigt glädjande. Fastigheter och samma sak där, det är bra efterfrågan. Klart större intresse att göra fastighetsaffärer, en annan riskkapacitet om vi jämför i alla fall med det för ett år sedan. Klar skillnad. Vi jobbar ju fortsatt som ni vet att minska volymer i steg tre framförallt, men steg två det är ju Det vi jobbar på och det tar tid men vi har goda förhoppningar att vi fortsätter minska. Det som sticker ut extra det här kvartalet skulle jag säga det är privat och volley. Privat som vi sa tidigare, vi har jobbat ett par år och tycker vi bör bära frukten på det nu. Vi har en väldigt bra position. The growth is where we want it. We have the opportunity to create a good risk-free withdrawal. So we are very satisfied with the private loan part. We have focus for us in Sweden. Vi har doppat tårna lite i Finland. Återstår att se hur det går. Det som är extra glädjande kan man säga inom privat, att vi äntligen får till en kortverksamhet på riktigt, så att vi faktiskt kan gasa en kortaffär. Det är väldigt, väldigt kul. Wally, super good. We're talking over 5 billion in transport volumes. A very, very good position. An incredibly good momentum. A lot of customers have a great interest in our payments solution, where we have focus on the north. Again, it's a profitable business for us. So it's really private and payments, as we should say, stands out extra positively, even if we are satisfied with the company's assets. Ja, vi har påbörjat vårt återköpsprogram, det pratar vi om, och vi pratar också om Verkekaupas finansieringsverksamhet Wall-E, där vi växer Wall-E med 10% var stort. Så det är ett starkt kvartal, så vi är nöjda med alla delar. Så med det tackar jag och Peter för att ni tar tid att lyssna, och vi öppnar upp för frågor. Tack!