First-quarter results 2024

Nordea Bank Abp / Key word(s): Quarter Results
First-quarter results 2024

18.04.2024 / 08:00 CET/CEST

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Nordea Bank Abp
Interim report (Q1 and Q3)
18 April 2024 at 7:30 EET

Summary of the quarter

Continued high-quality income growth. Total income was up 6%, driven by an
11% increase in net interest income. Net fee and commission income was
stable year on year and net insurance result increased by 33%. Net fair
value result was solid following a strong first quarter last year. Costs
decreased by 9%, driven by lower resolution fees. Costs excluding regulatory
fees increased by 5%, driven by inflation and continued investments in risk
management and technology in line with Nordea's plan. Operating profit was
up 19%.

Return on equity 18.1% - earnings per share up 23%. Nordea's return on
equity was 18.1% in the first quarter, compared with 17.1% a year ago. The
cost-to-income ratio excluding regulatory fees was stable at 40%. Earnings
per share increased to EUR 0.38 from EUR 0.31.

Volumes stable in a slow market. Nordea's corporate lending increased by 2%
year on year. Mortgage lending volumes were unchanged as mortgage markets
remained slow. Retail deposit volumes were up 1%. Corporate deposits
decreased by 6% year on year. Assets under management increased by 8% and
Nordic net flows amounted to EUR 1.1bn in the quarter.

Strong credit quality, continued low net loan losses. Net loan losses and
similar net result amounted to EUR 33m or 4bp. Overall provisioning levels
and coverage were maintained, and the total management judgement buffer
remained unchanged in local currencies (translating to EUR 505m).

Continued strong capital position. Nordea's CET1 ratio increased to 17.2%,
5.1 percentage points above the current regulatory requirement, which
demonstrates the bank's continued strong underlying capital generation and
capacity to support its customers. Nordea's Annual General Meeting of 21
March approved the dividend of EUR 0.92 per share for 2023. Nordea continues
to target an efficient capital structure and completed its fourth share
buy-back programme in March.

Outlook for 2024 unchanged: return on equity above 15%. Nordea has a strong
and resilient business model with a very well-diversified loan portfolio
across the Nordic region. This enables the bank to support its customers and
deliver high-quality earnings, with high profitability and low volatility,
through the economic cycle.

(For further viewpoints, see the CEO comment on page 2. For definitions, see
page 54 in the Q1 2024 report.)



Group quarterly results and key ratios

  EURm                                        Q1      Q1  Chg      Q4  Chg
                                            2024    2023    %    2023    %
  Net interest income                      1,954   1,765   11   1,946    0
  Net fee and commission income              763     765    0     763    0
  Net insurance result                        61      46   33      40   53
  Net fair value result                      291     345  -16     154   89
  Other income                                16       0           12   33
  Total operating income                   3,085   2,921    6   2,915    6
  Total operating expenses excluding      -1,22-  -1,16-    5  -1,39-  -12
  regulatory fees                              6       7            7
  Total operating expenses                -1,28-  -1,42-   -9  -1,41-   -9
                                               9       2            7
  Profit before loan losses                1,796   1,499   20   1,498   20
  Net loan losses and similar net result     -33     -19          -83
  Operating profit                         1,763   1,480   19   1,415   25

  Cost-to-income ratio excluding            39.7    39.9         47.9
  regulatory fees, %
  Cost-to-income ratio with amortised       40.7    42.7         50.6
  resolution fees, %
  Return on equity with amortised           18.1    17.1         14.1
  resolution fees, %
  Diluted earnings per share, EUR           0.38    0.31   23    0.31   23

CEO comment

We had a strong start to the year. Despite the subdued economic environment,
we maintained solid business momentum. Our competitive range of services and
proactive approach continue to be valued by our customers. Profitability was
again at a very good level, with return on equity reaching 18.1% for the
quarter, up from 17.1% a year ago.

Price inflation continued to ease across the Nordics, providing some relief
to households and businesses. However, macroeconomic and geopolitical
uncertainty remains high. Russia's war in Ukraine and the conflict in the
Middle East are constant reminders of the fragile state of the world today.

At Nordea, we are well equipped to navigate uncertainty and support our
customers. Our business franchise is strong, supported by a resilient and
well-diversified business model. We have leading positions in all our
markets and business areas. And, as our first-quarter results demonstrate,
we continue to be one of the best-performing banks in Europe.

Total income for the quarter increased by 6% year on year to EUR 3.1bn,
driven by 11% higher net interest income. Total costs decreased by 9% due to
substantially lower regulatory fees. Our cost-to-income ratio excluding
regulatory fees remained stable at 40%. Operating profit increased by 19%
year on year to EUR 1.8bn.

Alongside the constant development of our digital offering, we continued to
be highly proactive towards our customers, holding more customer meetings
than a year ago. Our approach is working. Although Nordic housing market
activity remained slow, our first-quarter mortgage lending volumes were
stable and we maintained our overall market share. We strengthened our
position in corporate lending, increasing volumes by 2% year on year.

Many of our household customers increased their savings and investment
activity, with deposit volumes up 1% year on year. We have been
strengthening our offering, and during the quarter we introduced new savings
deposit products. In Sweden, for example, Nordea's new high-interest savings
account comes with a built-in fraud prevention feature to help customers
safeguard their savings. Corporate deposit volumes decreased by 6% year on
year, although more stable quarter on quarter.

Nordea's credit quality remains strong. Our loan portfolio is diversified
across sectors and markets and supported by a prudent risk profile. Net loan
losses and similar net result amounted to EUR 33m, or 4bp - a low level
given the challenging economic environment. Nevertheless, we have retained
our management judgement buffer in local currencies (translating to EUR
505m) to cover additional potential losses.

Our four business areas each delivered good first-quarter results. In
Personal Banking we continued to see increased customer savings activity,
supported by the introduction of our new deposit products, with deposit
volumes up 2% in local currencies. While customer demand for new loan
promises was lower than in the same quarter last year, our mortgage lending
volumes were stable. Customers continued to take advantage of our digital
services, with the number of private app users and logins both up 7% year on
year.

In Business Banking we worked closely with our customers to help them tackle
the current economic challenges. Although the overall market demand for
lending continued to be slow, our lending volumes grew by 1% year on year in
local currencies, driven by Norway and Sweden. Deposit volumes grew by 1%
year on year, and customers continue to choose our attractive fixed-term
deposit products in the higher rate environment. We improved service quality
in digital channels and began the Norwegian rollout of our Nordea Business
app, which enables businesses to manage and purchase products easily through
their smartphones. Nordea Business is now available in all of our home
markets.

In Large Corporates & Institutions we continued to actively support our
Nordic customers with their investment plans. Lending grew by 3% and deposit
volumes decreased by 13% year on year. In debt capital markets, activity was
high and we arranged more than 200 transactions. Our sustainability
leadership was also recognised through several awards by Global Finance
magazine, including best in the world for sustainability-linked bonds. We
take great pride in the role we play in supporting the transition to a
low-carbon economy.

In Asset & Wealth Management we maintained strong momentum in our private
banking business, a key focus in our savings strategy. Customer activity was
high and we welcomed new clients. Assets under management increased by 8%
year on year to EUR 391bn, supported by net flows of EUR 1.1bn in our Nordic
channels, despite seasonal outflows. We continued to see strong traction in
our life insurance and pension business, with gross written premiums
reaching a record high for the first quarter.

We maintain a robust capital position. Our CET1 ratio stood at 17.2%, or 5.1
percentage points above the capital requirement. In March our AGM approved
the dividend for 2023, resulting in a total dividend payment of EUR 3.2bn,
supporting economic growth broadly in the Nordic societies. We also
completed our latest share buy-back programme of EUR 1bn. Our capital policy
and our ambition to deliver market-leading shareholder returns remain
unchanged. We continue to generate capital and expect to be in a position to
provide an update on our capital plans, including buy-backs, later this year
after the ECB approves our new capital models for retail exposures.

Looking ahead, we remain committed to delivering market-leading performance,
supported by focused and profitable growth and improved capital efficiency
through our well-diversified business model. We expect to achieve a return
on equity above 15% for the full year 2024 and target similarly strong
profitability in 2025.

We continue to build for the future. A strong bank is a resilient bank, and
we are always working to strengthen Nordea - building on our robust
financial position and developing every aspect of our operations. We are
strengthening our technology foundation. We are investing in our digital
offering to ensure we can offer our customers the very best services and
experiences. And we are working to protect our customers and societies from
financial crime.

A strong bank is also a responsible bank, which is why you can expect us to
maintain our strong focus on reducing financed emissions and supporting our
customers in meeting their climate transition requirements.

This is the way we will fulfil our ambition, which remains unchanged - to be
the preferred partner for customers in need of a broad range of financial
services.

Frank Vang-Jensen
President and Group CEO

Outlook (unchanged)

Financial target for 2025

Nordea's financial target for 2025 is a return on equity of above 15%.

The target will be supported by a cost-to-income ratio of 44-46%, an annual
net loan loss ratio of around 10bp and the continuation of Nordea's
well-established capital and dividend policies.

Financial outlook for 2024

Nordea expects a return on equity of above 15%.

Capital policy

A management buffer of 150bp above the regulatory CET1 requirement.

Dividend policy

Nordea's dividend policy stipulates a dividend payout ratio of 60-70%,
applicable to profit for the financial year. Nordea will continuously assess
the opportunity to use share buy-backs as a tool to distribute excess
capital.



Income statement

  EURm                                           Q1      Q1  Ch-      Q4  Ch-
                                               2024    2023    g    2023    g
                                                               %            %
  Net interest income                         1,954   1,765   11   1,946    0
  Net fee and commission income                 763     765    0     763    0
  Net insurance result                           61      46   33      40   53
  Net result from items at fair value           291     345  -1-     154   89
                                                               6
  Profit from associated undertakings and         7     -12            2
  joint ventures accounted for under the
  equity method
  Other operating income                          9      12  -2-      10  -1-
                                                               5            0
  Total operating income                      3,085   2,921    6   2,915    6
  Staff costs                                  -749    -719    4    -735    2
  Other expenses                               -338    -287   18    -323    5
  Regulatory fees                               -63    -255  -7-     -20
                                                               5
  Depreciation, amortisation and impairment    -139    -161  -1-    -339  -5-
  charges of tangible and intangible assets                    4            9
  Total operating expenses                   -1,28-  -1,42-   -9  -1,41-   -9
                                                  9       2            7
  Profit before loan losses                   1,796   1,499   20   1,498   20
  Net loan losses and similar net result        -33     -19   74     -83  -6-
                                                                            0
  Operating profit                            1,763   1,480   19   1,415   25
  Income tax expense                           -402    -332   21    -309   30
  Net profit for the period                   1,361   1,148   19   1,106   23

Business volumes, key items1

    EURbn                             31 Mar  31 Mar  Chg  31 Dec  Chg
                                        2024    2023    %    2023    %
    Loans to the public                346.2   339.7    2   344.8    0
    Loans to the public, excl.         319.8   319.3    0   324.0   -1
    repos/securities borrowing
    Deposits and borrowings from the   216.0   217.7   -1   210.1    3
    public
    Deposits from the public, excl.    200.3   210.7   -5   202.6   -1
    repos/securities lending
    Total assets                       604.9   604.1    0   584.7    3
    Assets under management            391.2   362.4    8   378.5    3

1. End of period.

Ratios and key figures including items affecting comparability1

                                             Q1      Q1  Chg      Q4  Chg
                                           2024    2023    %    2023    %
  Diluted earnings per share, EUR          0.38    0.31   23    0.31   23
  EPS, rolling 12 months up to period      1.44    1.21   19    1.37    5
  end, EUR
  Share price2, EUR                       10.47    9.84    6   11.23   -7
  Equity per share2, EUR                   8.25    7.84    5    8.86   -7
  Potential shares outstanding2,          3,506   3,605   -3   3,528   -1
  million
  Weighted average number of diluted      3,508   3,622   -3   3,534   -1
  shares, million
  Return on equity with amortised          18.1    17.1         14.1
  resolution fees, %
  Return on equity, %                      17.8    15.3         14.7
  Return on tangible equity, %             20.3    17.6         16.9
  Return on risk exposure amount, %         3.9     3.2          3.2
  Cost-to-income ratio excluding           39.7    39.9         47.9
  regulatory fees, %
  Cost-to-income ratio with amortised      40.7    42.7         50.6
  resolution fees, %
  Cost-to-income ratio, %                  41.8    48.7         48.6
  Net loan loss ratio, incl. loans held       4       2           10
  at fair value, bp
  Common Equity Tier 1 capital             17.2    15.7         17.0
  ratio2,3, %
  Tier 1 capital ratio2,3, %               19.5    18.0         19.4
  Total capital ratio2,3, %                22.4    20.1         22.2
  Tier 1 capital2,3, EURbn                 27.1    25.5    6    26.8    1
  Risk exposure amount2, EURbn            138.6   142.0   -2   138.7    0
  Net interest margin, %                   1.83    1.58         1.83
  Number of employees (FTEs)2            29,478  28,922    2  29,153    1
  Equity2, EURbn                           28.9    28.2    2    31.2   -7

1. See here for more detailed information regarding ratios and key figures
defined as alternative performance measures.
2. End of period.
3. Including the result for the period.

This release is a summary of Nordea's Q1 results 2024. The complete report
is attached to this release and can also be found on the below link on our
website.

Nordea Group Q1 2024 Report

http://www.rns-pdf.londonstockexchange.com/rns/1401L_1-2024-4-18.pdf

A webcast will be held on 18 April at 11.00 EET (10.00 CET). Frank
Vang-Jensen, President and Group CEO, will present the results followed by a
Q&A audio session for investors and analysts with Frank Vang-Jensen, Ian
Smith, Group CFO and Ilkka Ottoila, Head of Investor Relations.

The event will be webcast live and the recording and presentation slides
will be posted on www.nordea.com/ir.

For further information:

Frank Vang-Jensen, President and Group CEO, +358 503 821 391
Ian Smith, Group CFO, +45 5547 8372
Ilkka Ottoila, Head of Investor Relations, +358 9 5300 7058
Ulrika Romantschuk, Head of Brand, Communication and Marketing, +358 10 416
8023

The information provided in this stock exchange release was submitted for
publication, through the agency of the contacts set out above, at 07:30 EET
(06:30 CET) on 18 April 2024.


We are a universal bank with a 200-year history of supporting and growing
the Nordic economies - enabling dreams and aspirations for a greater good.
Every day, we work to support our customers' financial development,
delivering best-in-class omnichannel customer experiences and driving
sustainable change. The Nordea share is listed on the Nasdaq Helsinki,
Nasdaq Copenhagen and Nasdaq Stockholm exchanges. Read more about us at
nordea.com.

This information is provided by RNS, the news service of the London Stock
Exchange. RNS is approved by the Financial Conduct Authority to act as a
Primary Information Provider in the United Kingdom. Terms and conditions
relating to the use and distribution of this information may apply. For
further information, please contact rns@lseg.com or visit www.rns.com.


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   Language:       English
   Company:        Nordea Bank Abp
                   Smålandsgatan 17
                   105 71 Stockholm
                   Sweden
   ISIN:           FI4000297767
   Valor:          A2N6F4
   Listed:         Regulated Unofficial Market in Berlin, Dusseldorf,
                   Frankfurt, Hamburg, Hanover, Munich, Stuttgart; SIX
                   Swiss Exchange
   EQS News ID:    1883191

End of News EQS News Service
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1883191 18.04.2024 CET/CEST