IBOS member Nordea has announced their financial results of Q3 2016, ended 30 September 2016, in a report released on 26 October 2016.
Nordea Bank has reported that the net interest income in local currencies increased 1% from the previous quarter, and lending margins were largely unchanged. Net interest income for Retail Banking was up 2% in local currencies from the previous quarter, driven by a strong performance in Sweden, while higher NIBOR rates pressured the margins in Norway.
Fee and commission income was up 4% in local currencies compared to the third quarter of 2015, mainly driven by Asset Management, where revenues were up 13% on the bank of higher volumes. In the third quarter, inflow was at an all-time high of EUR 9.6bn or 13% of assets under management, annualised. Return on equity was 11.6% in the quarter, up from 10.4% from the previous quarter, and the cost-to-income ratio improved by 1.0%-point to 48.1%.
“The third quarter was characterised by a stable environment with low volatility on financial markets but also continued low growth. Our credit quality remains solid with a loan loss level at the 10-year average. In terms of deal value, we are ranked as number two in Europe as a global co-ordinator of IPO’s,” said Casper von Koskull, Nordea, President and Group CEO. “We are now one year into our business and culture transformation journey. We are simplifying our legal structure, replacing the core banking platform and investing in our compliance functions, as well as appointing world-class experts, many of whom have an international background, to several key strategic positions. The overall aim is to continue building the bank our customers want us to be.”
Below are the highlights of our third quarter 2016 results, compared to third quarter 2015:
- Net interest income EUR 1,178m, -4%; -4% in local currencies (+1%, +1% in local currencies)
- Total operating income EUR 2,466m, +9%; +10% in local currencies (+3%, +3% in local currencies)
- Total expenses EUR 1,183m, +7%; +8% in local currencies (-2%, -1% in local currencies)
- Profit before loan losses EUR 1,283m, +12%; +12% in local currencies (-5%, -5% in local currencies)
- Net loan losses EUR 135m, +21%; +23% in local currencies (+6%, +5% in local currencies)
- Operating profit EUR 1,148m, +11%; +11% in local currencies (+7%, +7% in local currencies)
- Common Equity Tier 1 capital ratio 17.9%, up from 16.3% (up 110 bps from 16.8%)
- Cost/income ratio 48%, down from 49% (down 2%-points from 50%)
- Loan loss ratio of 16 bps, up from 13 bps (up 1 bps from 15 bps)
- Return on equity 11.6%, up from 10.4% (up 20 bps from 11.4%)
- Diluted EPS EUR 0.22 vs. EUR 0.19 (EUR 0.22 vs. EUR 0.25)
Access the full report, via Nordea’s website, here.