Solid performance with strong cost and credit risk control
Highlights of the quarter:
Controlled loan growth
• Underlying loan balance growth of 5% vs. Q2 2023 (4%) a mid prudent risk management• 34% growth y-o-y supported by better customer processes and automation (throughput)
Stable margins
• Net interest margin stable at 9%, in line with the four previous quarters• 2%p increase in borrowing cost y-o-y compensated by growth and loan repricing
Continued cost reductions
• Operating expenses reduced to NOK 77 million, down 7% vs Q2• 19% cost reduction y-o-y driven by successful initiatives to improve cost efficiency
Solid credit risk control
• Loan loss ratio at 5%, up 0.2%p in Q3 driven by macroeconomic and other provisions• Improved credit risk and pricing capabilities to build a more robust and scalable platform
Profitability maintained
Profit after tax of NOK 36 million, vs. NOK 41 million in Q2 for which total income was positively impacted by a NOK 5 million one-off• Increased loan loss provisions offset by further cost improvements • Return on equity of 6.1% vs 7.5% in Q2
Comment from the CEO, Øyvind Oanes:"In the third quarter of 2023, we delivered a solid annualised loan balance growth in the 5-10% range while maintaining margins and controlling credit risk. This against a backdrop of a more challenging macroeconomic environment where inflation continued to be high across the Nordic region and market interest rates increased-driving up our funding costs. Since the beginning of 2022, we have focused on continuously improving efficiency. As a result, our operational cost base has been reduced by more than 20% in a period where the Bank's loan balance has grown by more than 40%. Importantly, we have built a robust bank that is competitive versus peers on key performance metrics and is well-positioned for delivering growth and value creation."
The interim report and presentation are available onReports and presentations page
Morrow Bank ASA published this content on 25 October 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 October 2023 05:08:04 UTC.
Morrow Bank ASA, formerly Komplett Bank ASA, is a Norway-based bank offering convenient payment and financing products to consumers. The Bank is focused on creating value for its customers by offering flexible, convenient financing solutions through efficient, customer friendly processes. Operational efficiency and low cost are foundations for the bank and is enabled by centralized operations, modern systems, and digital set-up. The Bank is pursuing a growth strategy based on geographical and product-wise diversification and expansion. The product portfolio includes consumer loans, credit cards, point-of-sales finance solutions, and high-yield deposit accounts. The Bank operates in Norway, Sweden and Finland.