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Beskrivning
| Land | Finland |
|---|---|
| Lista | Large Cap Stockholm |
| Sektor | Finans |
| Industri | Storbank |
Nordea Bank Abp
Interim report (Q1 and Q3)
16 April 2025 at 7.30 EET
Summary of the quarter
Continued growth in fees and commissions; total income resilient. Net interest income was down 6% following policy rate reductions. Net fee and commission income continued to grow, and was up 4%. Net insurance result and net fair value result were both solid. Total income was down 4% year on year, but up 1% quarter on quarter. Costs increased by 5%, of which 4 percentage points was driven by strategic investments. Operating profit decreased by 9% year on year, but was up 10% quarter on quarter, amounting to EUR 1.6bn.
Return on equity 15.7%; earnings per share EUR 0.35. Nordea's return on equity remained strong at 15.7% in the first quarter, reflecting resilience and continued high performance. The first-quarter cost-to-income ratio with amortised resolution fees was 44.6%, well within the target range of 44-46%. Earnings per share were EUR 0.35, compared with EUR 0.38 a year ago.
Mortgage lending and deposit volumes up. Nordic mortgage markets remained muted, though there were further signs of a gradual recovery, with demand for new loan promises continuing to increase. Mortgage lending grew by 6% year on year, driven by the acquisition of Danske Bank's personal customer and private banking business in Norway. Excluding this, mortgage lending was stable. Corporate lending was stable, with markets remaining muted. Retail and corporate deposit volumes increased by 7% and 11%, respectively. Assets under management increased by 9% and Nordic net flows amounted to EUR 2.7bn in the quarter.
Strong credit quality, with net loan losses well below Nordea's long-term expectation. Net loan losses and similar net result amounted to EUR 13m or 1bp. EUR 20m was released from the management judgement buffer, which now stands at EUR 397m.
Continued strong capital generation; share buy-backs ongoing. The CET1 ratio was 15.7% at the end of the quarter, 2.0 percentage points above the regulatory requirement, as strong capital generation partly offset the impacts of the share buy-back deduction and regulatory updates, including Basel IV. Nordea launched a new EUR 250m share buy-back programme on 10 March, and expects to complete the programme by 13 June 2025.
Outlook for 2025 unchanged: return on equity of above 15%. Nordea has a strong and resilient business model, with a well-diversified loan portfolio across the Nordic region. This enables Nordea to support its customers and deliver high-quality earnings, with high profitability and low volatility, through the economic cycle. It also enables Nordea to continue to generate capital, seek opportunities to deploy it to drive growth, and distribute excess capital to shareholders in the form of share buy-backs.
(For further viewpoints, see the CEO comment. For definitions, see page 53 in the Q1 2025 report.)
Group quarterly results and key ratios
| EURm | Q1 2025 | Q1 2024 | Chg % | Q4 2024 | Chg % |
|---|---|---|---|---|---|
| Net interest income | 1,829 | 1,954 | -6 | 1,854 | -1 |
| Net fee and commission income | 793 | 763 | 4 | 825 | -4 |
| Net insurance result | 54 | 61 | -11 | 69 | -22 |
| Net fair value result | 289 | 291 | -1 | 201 | 44 |
| Other income | 9 | 16 | -44 | 6 | 50 |
| Total operating income | 2,974 | 3,085 | -4 | 2,955 | 1 |
| Total operating expenses excluding regulatory fees | -1,300 | -1,226 | 6 | -1,416 | -8 |
| Total operating expenses | -1,354 | -1,289 | 5 | -1,434 | -6 |
| Profit before loan losses | 1,620 | 1,796 | -10 | 1,521 | 7 |
| Net loan losses and similar net result | -13 | -33 |
| -54 |
|
| Operating profit | 1,607 | 1,763 | -9 | 1,467 | 10 |
|
|
|
|
|
|
|
| Cost-to-income ratio excluding regulatory fees, % | 43.7 | 39.7 |
| 47.9 |
|
| Cost-to-income ratio with amortised resolution fees, % | 44.6 | 40.7 |
| 48.9 |
|
| Return on equity with amortised resolution fees, % | 15.7 | 18.1 |
| 14.3 |
|
| Diluted earnings per share, EUR | 0.35 | 0.38 | -8 | 0.32 | 9 |
CEO comment
The world today looks different from a few months ago. Trade tensions and geopolitical challenges have increased uncertainty considerably. While tariffs are not helpful, the Nordic countries - recognised for their fiscal strength and globally competitive businesses - are better positioned than many to manage through periods of volatility and turmoil. In the present environment, many of our customers have been choosing to retain financial flexibility, with households focusing on saving and corporates strengthening their balance sheets - and delaying major financial decisions as a result. Still, we continue to see lower inflation and interest rates, which should support higher lending and investment activity when confidence returns.
Despite the uncertainty, Nordea performed well in the first quarter, delivering growth in business volumes and continued high profitability. Return on equity was 15.7%, consistent with our financial target set three years ago. Our structurally improved profitability reinforces Nordea's position as a strong, resilient and market-leading financial services group.
Total income decreased by 4% year on year, to EUR 3.0bn, driven by lower policy rates. Despite this, our net interest income showed continued resilience, amounting to EUR 1.8bn for the quarter, supported by higher business volumes, disciplined pricing and a positive deposit hedge contribution. Meanwhile, we delivered solid growth in net fee and commission income, with higher savings income offsetting overall slow capital markets activity.
Mortgage lending volumes grew by 6% year on year. This was driven by our recent acquisition of Danske Bank's Norwegian personal customer and private banking business and further supported by the gradual recovery in the Nordic housing markets. Customer demand for loan promises continued to grow and retail deposits were up 7%. Corporate lending was stable, while corporate deposits grew by 11%.
Costs increased by 5% year on year, reflecting our strategic investments in several areas, including technology, data and AI, digital services and cyber security. These investments will support income and profit growth and help us build a stronger and even more resilient financial services group. They are also key to unlocking the benefits of our unique Nordic scale, enabling us to further improve customer experience, drive business growth and increase efficiency. Our investment levels have stabilised after peaking during the second half of last year, and we expect full-year cost growth to be 2.0-2.5%. Our cost-to-income ratio with amortised resolution fees was 44.6% for the first quarter. Operating profit was EUR 1.6bn, compared with EUR 1.8bn a year ago, but was up 10% quarter on quarter.
Our credit and asset quality remain strong. Individual provisions were low, and we released a further EUR 20m from our management judgement buffer. As a result, our first-quarter net loan losses and similar net result amounted to EUR 13m. The buffer now stands at EUR 397m.
In Personal Banking we delivered higher lending and deposit volumes, supported by our acquisition in Norway and higher customer activity. Compared with a year ago, customers started more savings plans, increased their monthly savings, made more loan applications and increased their digital activity. App users and logins were up by 7% and 8%, respectively, year on year. Our new customers in Norway are settling in well, and we are actively developing these new relationships through our digital channels and advisers.
In Business Banking we had a 1% increase in lending volumes, driven by Sweden and Finland, and we facilitated more bond financing. Deposits increased by 6%, growing in all our home markets. Five years ago, we launched a strategic initiative to transform our customer offering and regain a leading position in Sweden by strengthening our digital and advisory services and enhancing customer experience. Our success is reflected in growth and market share gains, and in the latest annual survey by Prospera, the recognised industry benchmark for customer satisfaction. There, we ranked first in Sweden for both small and mid-sized corporates, receiving the highest scores in all ten categories in both segments.
In Large Corporates & Institutions demand for our risk management and hedging solutions was very strong, though there was reduced appetite for bank financing. Lending volumes decreased by 1% year on year as customers continued to favour bond issuance for raising money. Debt capital markets activity was high among both corporate and institutional customers. Conditions were more muted in equity capital markets and mergers and acquisitions. During the quarter we were named Best Investment Bank in all four of our home markets in the Global Finance Awards for 2025.
In Asset & Wealth Management we kept up the good momentum in our private banking business, welcoming new customers and growing in all our home markets. Nordic net flows for the quarter were positive at EUR 2.7bn. In our international channels we had net inflows of EUR 3.9bn as we regained momentum in the institutional segment and onboarded several large mandates, supported by our strong track record in sustainable investment strategies. Assets under management grew by 9% year on year, to EUR 425bn.
Our capital position remains strong, supported by continued robust capital generation. At the end of the first quarter our CET1 ratio was 15.7% after deductions for the new share buy-back programme launched in March and regulatory updates, including Basel IV.
This was a solid quarter for Nordea and we remain on track to deliver a return on equity of above 15% for the full year. Our strength is supported by the long-standing financial stability, competitiveness and entrepreneurial spirit of the Nordic societies. Few countries are better equipped than our home markets to navigate the current global shifts.
As this is the final year of our current strategy period, we look forward to presenting our strategy for 2026 and beyond at our Capital Markets Day in London on 5 November. We will share the concrete steps we are taking to build on our successful recipe, with continued focus on our four home markets. This will enable us to outgrow the market, continue delivering market-leading return on equity, and achieve superior earnings per share growth.
Frank Vang-Jensen
President and Group CEO
Outlook (unchanged)
Financial outlook for 2025
Nordea's financial outlook for 2025 is 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 2025 | Q1 2024 | Chg % | Q4 2024 | Chg % |
|---|---|---|---|---|---|
| Net interest income | 1,829 | 1,954 | -6 | 1,854 | -1 |
| Net fee and commission income | 793 | 763 | 4 | 825 | -4 |
| Net insurance result | 54 | 61 | -11 | 69 | -22 |
| Net result from items at fair value | 289 | 291 | -1 | 201 | 44 |
| Profit from associated undertakings and joint ventures accounted for under the equity method | -3 | 7 |
| -3 | 0 |
| Other operating income | 12 | 9 | 33 | 9 | 33 |
| Total operating income | 2,974 | 3,085 | -4 | 2,955 | 1 |
| Staff costs | -792 | -749 | 6 | -817 | -3 |
| Other expenses | -359 | -338 | 6 | -451 | -20 |
| Regulatory fees | -54 | -63 | -14 | -18 |
|
| Depreciation, amortisation and impairment charges of tangible and intangible assets | -149 | -139 | 7 | -148 | 1 |
| Total operating expenses | -1,354 | -1,289 | 5 | -1,434 | -6 |
| Profit before loan losses | 1,620 | 1,796 | -10 | 1,521 | 7 |
| Net loan losses and similar net result | -13 | -33 | -61 | -54 | -76 |
| Operating profit | 1,607 | 1,763 | -9 | 1,467 | 10 |
| Income tax expense | -373 | -402 | -7 | -338 | 10 |
| Net profit for the period | 1,234 | 1,361 | -9 | 1,129 | 9 |
Business volumes, key items1
| EURbn | 31 Mar 2025 | 31 Mar 2024 | Chg. % | 31 Dec 2024 | Chg. % |
|---|---|---|---|---|---|
| Loans to the public | 366.8 | 346.2 | 6 | 357.6 | 3 |
| Loans to the public, excl. repos/securities borrowing | 335.7 | 319.8 | 5 | 329.0 | 2 |
| Deposits and borrowings from the public | 240.0 | 216.0 | 11 | 232.4 | 3 |
| Deposits from the public, excl. repos/securities lending | 221.2 | 200.3 | 10 | 215.4 | 3 |
| Total assets | 641.4 | 604.9 | 6 | 623.4 | 3 |
| Assets under management | 425.2 | 391.2 | 9 | 422.0 | 1 |
1. End of period.
Ratios and key figures1
|
| Q1 2025 | Q1 2024 | Chg % | Q4 2024 | Chg % |
|---|---|---|---|---|---|
| Diluted earnings per share, EUR | 0.35 | 0.38 | -8 | 0.32 | 9 |
| EPS, rolling 12 months up to period end, EUR | 1.41 | 1.44 | -2 | 1.44 | -2 |
| Share price2, EUR | 11.77 | 10.47 | 12 | 10.50 | 12 |
| Equity per share2, EUR | 8.55 | 8.25 | 4 | 9.30 | -8 |
| Potential shares outstanding2, million | 3,491 | 3,506 | 0 | 3,503 | 0 |
| Weighted average number of diluted shares, million | 3,483 | 3,508 | -1 | 3,493 | 0 |
| Return on equity with amortised resolution fees, % | 15.7 | 18.1 |
| 14.3 |
|
| Return on equity, % | 15.4 | 17.8 |
| 14.4 |
|
| Return on tangible equity, % | 17.6 | 20.3 |
| 16.5 |
|
| Return on risk exposure amount, % | 3.1 | 3.9 |
| 2.9 |
|
| Cost-to-income ratio excluding regulatory fees, % | 43.7 | 39.7 |
| 47.9 |
|
| Cost-to-income ratio with amortised resolution fees, % | 44.6 | 40.7 |
| 48.9 |
|
| Cost-to-income ratio, % | 45.5 | 41.8 |
| 48.5 |
|
| Net loan loss ratio, incl. loans held at fair value, bp | 1 | 4 |
| 6 |
|
| Common Equity Tier 1 capital ratio2,3, % | 15.7 | 17.2 |
| 15.8 |
|
| Tier 1 capital ratio2,3, % | 17.6 | 19.5 |
| 18.4 |
|
| Total capital ratio2,3, % | 20.2 | 22.4 |
| 21.0 |
|
| Tier 1 capital2,3, EURbn | 28.1 | 27.1 | 4 | 28.7 | -2 |
| Risk exposure amount2, EURbn | 159.7 | 138.6 | 15 | 155.9 | 2 |
| Net interest margin, % | 1.70 | 1.83 |
| 1.73 |
|
| Number of employees (FTEs)2 | 30,343 | 29,478 | 3 | 30,157 | 1 |
| Equity2, EURbn | 29.7 | 28.9 | 3 | 32.4 | -8 |
1. For more detailed information regarding ratios and key figures defined as alternative performance measures, see https://www.nordea.com/en/investor-relations/reports-and-presentations/group-interim-reports.
2. End of period.
3. Including the result for the period.
This release is a summary of Nordea's first-quarter results for 2025. The complete report is attached to this release and can also be found on our website via the link below.
A webcast will be held on 16 April at 11.00 EET (10.00 CET), during which Frank Vang-Jensen, President and Group CEO, will present the results. This will be 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, +455 547 8372
Ilkka Ottoila, Head of Investor Relations, +358 953 007 058
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 16 April 2025.
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.