SpareBank 1 Sørøst-Norge posted a profit after tax of NOK 170 million for the
first quarter of 2022, compared with the NOK 217 million for the same quarter in
2021 (pro forma for SpareBank 1 BV and Sparebanken Telemark). The Group is
delivering a good profit for the quarter, although it was affected by
recognition of NOK 67 million in merger-related one-off costs. 

Net interest income including commission income from mortgage credit
institutions grew by (pro forma) 8.6%. Lending growth in the past 12 months was
5.3% and was the same in the retail and corporate markets, while growth in the
first quarter was 0.3% in the retail market and 3.1% in the corporate market. 

Other commission income grew by (pro forma) 11.3% due to good growth in payment
services and insurance services compared with the same period last year. Other
operating income was on a par with last year. The net result from financial
investments decreased by NOK 46 million from last year and was affected by a
weak result in SpareBank 1 Gruppen for the first quarter and a negative result
from other financial investments.

The Bank adjusted its lending and deposit rates following Norges Bank's interest
rate decision in March. The changes will not take full effect until the middle
of May.  A general rise in market rates is expected to improve the Group's
interest rate margin and earnings. Higher interest rates going forward may lead
to lower credit growth and greater competition, especially in the residential
mortgage segment.

At the end of the quarter, the proportionally consolidated Common Equity Tier 1
capital ratio was 18.2% (17.6% pro forma) and the leverage ratio was 8.3% (9.1%
pro forma).

An expanded SME discount will be introduced in connection with the approved
banking package in CRR 2/CRD V. Preliminary calculations estimate the effect
will be an increase in the Common Equity Tier 1 capital ratio of 0.6 percentage
points. The banking package will come into force on 01.06.2022.  

SpareBank 1 Sørøst-Norge's strategic plan includes an ambition to increase our
market share in our region, while being a proactive participant in the
structural developments in the banking sector in Eastern Norway. An Advanced
Internal Rating-Based (AIRB) permit will make us more competitive and probably
more attractive in structural dialogues.
 
The Group's ambition is to establish itself as a regional bank on a par with the
other regional banks in the SpareBank 1 Alliance. For the Group, it will be
absolutely vital to ensure our competitiveness, profitability, and management
and control of credit risk are on a par with the banks with which we compete. 
The Group has, through organic and structural growth, reached a size that means
it can start working on preparing an application to the Financial Supervisory
Authority of Norway for approval to use advanced IRB models.
 
As a result of the mergers with Sparebanken Telemark in 2021 and SpareBank 1
Modum in 2022, the Bank has established a project that includes integration of
the three banks within the area of credit, as well as surveying established
practice for AIRB banks in order to identify areas that must be worked on before
the application can be submitted. The Board believes it is an advantage that the
SpareBank 1 Alliance has already developed a strong professional environment
that manages and develops IRB models that are used by the regional banks in the
alliance and to which SpareBank 1 Sørøst-Norge has access and has used for
several years.
 
Based on the current loan portfolio, it is estimated that AIRB approval could
improve the Common Equity Tier 1 capital by around 5 percentage points. It must
be stressed that there is some uncertainty associated with this estimate.
The application is expected to be submitted to the Financial Supervisory
Authority of Norway in the first half of 2024.


Highlights for Q1 2022 (figures in brackets relate to pro forma for Q1 2021) 
o	Ordinary profit after tax of NOK 170(217) million
o	Net interest income NOK 306 (265) million 
o	Profit contributions from SpareBank 1 Gruppen and BN Bank ASA of NOK 4
(16)million and NOK 11 (9) million, respectively
o	Higher operating expenses were mainly due to merger-related one-time costs of
NOK 67 (4) million
o	Losses on loans and guarantees of NOK -11 million (NOK 13 million) 
o	Return on equity of 7.0 (9.6)%
o	Lending and deposit growth in the past 12 months of 5.3(6.8)% and 7.9 (6.5)%,
respectively


The quarterly report can be downloaded in full from the Bank's website
sparebank1bv.no

The quarterly report for SpareBank 1 Modum, which merged with SpareBank 1
Sørøst-Norge on 01.04.2022, is also attached.

Sandefjord, 11.05.2022

Contact persons 

CEO Per Halvorsen, Tel. +47 934 07 441 
Deputy CEO Geir Årstein Hansen, Tel. +47 913 22 137 
CFO Roar Snippen, Tel. +47 976 10 360

This information must be disclosed pursuant to section 5-12