Investor Relations. Supplementary information First Quarter 2009

Transcription

1 Investor Relations Supplementary information First Quarter 2009

2 SpareBank 1 SMN 7467 Trondheim Chief Executive, CEO Finn Haugan For further information, please contact Kjell Fordal, Executive Director Finance Division tel Switchboard tel Information on the Internet SpareBank 1 SMN s home page Hugin-Online PCC information in general Financial Calendar 1 st quarter 04. May nd quarter 12. August rd quarter 30. October th quarter 03. February 2010

3 Contents 1. Sparebank 1 SMN overview Financial highlights Business description Credit ratings Primary Capital Certificate (PCC) Financial results Main figures Net interest income Commission income Operating expenses Loans to customers Distribution of loans by industry Risk profile and write-downs Capital Adequacy Funding Financial results Segment information Extract from income statement Retail division Corporate division Markets Subsidiaries

4 1. SpareBank 1 SMN overview 1.1. Financial highlights First quarter 2009 (comparable figures for first quarter in parentheses) Profit before tax NOK 112 million (NOK 143 million). Group profit after tax NOK 74 million (NOK 94 million). Profit per PCC NOK 0,6 (NOK 0,81). PCC bonus issue on a one-to-five basis carried out. Return on equity after tax* 5,8 % (7,8 %). Reduced cost/income ratio; 58,1 % in first quarter 2009 (66,7 %). Increase in loss on loans. NOK 110 million (NOK 1 million), where NOK 16 million comes from increased group write-downs (NOK 1 million). Strong solidity; core capital ratio 8,4 % (8,9 %) and capital adequacy ratio 11,8 % (12,7%). Reduced growth in loans to customers. Growth in loans last 12 months was 12,6 % (17,2 %). Growth in loans first quarter 2009 was 1,5 % (3,8 %). *Net profit as percentage of average equity - 2 -

5 1.2. Business description SpareBank 1 SMN is Mid-Norway s largest bank with assets totalling NOK 84.9 billion at the end of first quarter Head office is in Trondheim and the Group employs about 1,000 staff. SpareBank 1 SMN is organised in six divisions to secure a customer-oriented and cost-effective organisation while respecting the differing competencies required by each division. The Retail, Corporate and Markets divisions focus on customer satisfaction, risk management and activity-based sales and counselling. Business Support focuses on cost-effective work processes and support to enable the customer-facing divisions to attain their goals, while the Finance Division provides an overall basis for decision making, risk management and financial and asset-liability management. Board CEO Finn Haugan Internal Audit Ernst & Young Legal Affairs Marte Voie Opland Risk Management Communications Ola Neråsen Marvin Wiseth Finance SpareBank 1 Markets Corporate Market Retail Market Western Norway Business Support Kjell Fordal Dag Ivar Thobroe Reidar Stokke Tore Haarberg Olav Gjærland Tina Steinsvik Sund As one of six members of the SpareBank 1 Alliance, the Bank forms part of Norway s second largest financial grouping. The SpareBank 1 Alliance s mission is to procure and deliver competitive financial services and products, and to take out economies of scale in the form of lower costs and/or higher quality. The SpareBank 1 banks have completed their acquisition of Glitnir Bank ASA (now BNbank ASA), where SpareBank 1 SMN holds a 25 % share

6 SpareBank 1 Gruppen 19,9 % 19,9 % 19,9 % 19,9 % 11,1 % 9,3 % SMN SR-Bank Nord-Norge Samspar Hedmark LO Glitnir / Bnbank 25 % 20 % 20 % 20 % 15 % 0 % BNbank Alliansesamarbeidet SpareBank 1 Gruppen AS BN Boligkreditt BN Kreditt SpareBank 1 Factoring SpareBank 1 Oslo (100%) SpareBank 1 Boligkreditt Eiendomsmegler 1 Bnbank SpareBank 1 Skadeforsikring (100%) Argo Securities (75%) SpareBank 1 Gruppen Finans Holding AS (100%) ODIN Forvaltning (100%) SpareBank 1 Livsforsikring (100%) First Securities (100%) SpareBank 1 Factoring (100%) Actor Fordrings forvaltning (100%) SpareBank 1 LTO (100%) 1.3. Credit ratings Moody's Previous rating Todays rating (24.10.) ( ) Outlook Negative Stable Issuer Rating Aa3 A1 Bank Deposits Aa3 / P-1 Aa3 / P-1 Bank Financial Strenght C+ C Senior Unsecured MTN Aa3 Aa3 Subordinate MTN A1 A1 Fitch Previous rating Todays rating (24.10.) ( ) Outlook Stable Negative Issuer Default A A Senior Debt A A Short Term F1 F1 Support rating floor BB+ BB+ Individual B B/C Support

7 1.4. Primary Capital Certificate (PCC) 31. March 2009 the price of the Bank s PCC was NOK (NOK 42,50). Earnings per PCC were NOK 0.60 (NOK 0.81) and book value per PCC was NOK as of end first quarter 2009 (NOK 38.92). A one-for-five bonus issue was carried out on 31 March 2009, and a cash dividend of NOK 2.00 per PCC has been declared for and is scheduled for payment on 15 April Stock Price MING/OSEBX January March Ming OSEBX largest PCC holders Owner Number Share Reitangruppen AS ,77 % Bank1 Oslo AS ,03 % Protector Eiendom AS ,13 % I.K. Lykke, T.Lykke m.fl ,01 % Morgan Stanley & C o ,92 % The Northern Trust Co. (nominee) ,78 % Frank Mohn AS ,51 % Meieribrukets Pensjonskasse ,15 % J P Morgan Chase Bank, UK (nominee) ,96 % Tonsenhagen Forretningssentrum as ,91 % - 5 -

8 2. Financial results Accounting principles SpareBank 1 SMN s consolidated accounts are prepared under IFRS (International Financial Reporting Standards) As from 2007 the company accounts are also prepared under IFRS, entailing that investments in associated companies are accounted for using the cost method. Results of subsidiaries and associates are accordingly not included in the parent bank s accounts Main figures Q1 Q4 Q3 Q2 Q1 (in NOK million) Interest income Interest expenses Net interest Commission income and other income Net return on financial investments Total income Staff costs Administration costs Other operating expenses Total operating expenses Result before losses Loss on loans, guarantees etc Result before tax Tax charge Net profit Balance sheet - condensed Q1 Q4 Q3 Q2 Q1 Balance (in NOK million) Gross loans to customers * Deposits from customers Growth in loans incl Boligkreditt last 12 mths 12,6 % 15,2 % 16,3 % 16,3 % 17,2 % 12,6 % 17,2 % 15,2 % Growth in deposits last 12 mths 7,6 % 8,8 % 12,0 % 10,1 % 7,5 % 7,6 % 7,5 % 8,8 % Deposits-to-loan ratio 55,6 % 55,1 % 56,9 % 59,3 % 56,7 % 55,6 % 56,7 % 55,1 % Total assets Average total assets * Loans to customers includes SpareBank 1 Boligkreditt Key figures Q1 Q4 Q3 Q2 Q Return on equity 6,6 % 24,9 % 3,1 % 12,0 % 7,8 % 6,6 % 7,8 % 11,9 % Adjusted profit per PCC 0,60 2,66 0,32 1,20 0,81 0,74 0,81 4,94 Net other operating income of total income* 32,7 % 25,2 % 31,0 % 35,5 % 33,6 % 32,7 % 33,6 % 31,3 % Cost/income ratio group 58,1 % 36,4 % 68,9 % 60,5 % 66,7 % 58,1 % 66,7 % 54,8 % Core capital ratio 8,4 % 8,1 % 8,8 % 8,5 % 8,9 % 8,4 % 8,9 % 8,1 % Number of full-time positions Number of branches * Income from financial investments not included - 6 -

9 2.2. Net interest income Net interest income Q1 Q4 Q3 Q2 Q1 (in NOK million) Interest income Interest expences Net interest income As per cent of average total assets 1,57 1,87 1,75 1,73 1,75 1,57 1,87 1,77 Development in net interest income ,5 % ,0 % 2,5 % 2,0 % ,75 % 1,57 % 1,5 % 1,0 % 240 0,5 % 220 1Q08 2Q08 3Q08 4Q08 1Q09 0,0 % Net interest income As percent of average total assets Specified net interest income Average Volume Average Margin Net interest income (in NOK million) 1Q09 4Q08 1Q08 1Q09 4Q08 1Q08 1Q09 4Q08 1Q08 Lending ,14 0,79 0, Deposits ,03 1,82 1, Equity and other interest income Net interest income Changes in interest income from lending and deposits, last 12 months (in NOK million) Volume Margin Total Lending Deposits Total

10 Changes in net interest income (in NOK million) 2009 Change Net interest income Lending volume and commission 1 Deposits volume 13 Lending margin 72 Deposits margin -61 Equity capital -15 SpareBank1 SMN Finans 13 Change Net interest income 1Q08 Lending volume and commission Deposits volume Lending margin Deposits margin Equity capital SpareBank1 SMN Finans Net interest income 1Q09 Volume and margin development Margin Volume in NOK bn 80 1,8 1,5 1,75 64,3 67,4 69,6 71,3 72, ,2 1, ,9 0,6 33,4 0,69 35,8 35,7 35,3 35,9 1, , Q1 Q2 Q3 Q4 Q1 Lending volume Deposits volume Lending margin Deposits margin - 8 -

11 Development in margin 2,44 2,35 2,49 2,61 2,17 1,75 1,72 1,81 1,82 1,14 0,69 0,63 0,68 0,79 1, Q1 Q2 Q3 Q4 Q1 Combined margin Lending margin Deposits margin Development in volume Growth Volume 20 % % 16 % 14 % 17,5 % 64,3 67,4 69,6 71,3 72, % 12,6 % % 8 % 6 % 4 % 2 % 35,8 35,7 35,3 35,9 33,4 7,5 % 7,6 % % Q1 Q2 Q3 Q4 Q1 Lending volume Growth in loans last 12 months Deposits volume Growth in deposits last 12 monts - 9 -

12 2.3. Commission income Total commission and other income Q1 Q4 Q3 Q2 Q1 (in NOK million) Guarantee commissions Commission from SpareBank 1 Boligkreditt Other commission income Portfolio commission of savings products Broker commission Insurance services Payment transmission services Sales commission of savings products Total commissions income Operating- and sales income real property Other operating income Total other operating income Commission expenses Total commissions and other income As percentage of total income 33 % 25 % 31 % 35 % 34 % 33 % 34 % 39 % As per cent of average total assets 0,76 0,63 0,88 0,91 0,89 0,76 0,89 0,81 Distribution of commission income Payment transmission services; 40 % Sales commission of savings products; 6 % Guarantee commissions; 5 % Commission from SpareBank 1 Boligkreditt; 10 % Insurance services; 13 % Broker commission; 17 % Other commission income; 3 % Portfolio commission of savings products; 6 %

13 Change in commission income (in NOK million) 2009 Change Total Guarantee commissions 1 Broker commission -1 Portfolio commission of savings products 0 Sales commission of savings products -11 Commission from SpareBank 1 Boligkreditt 10 Payment transmission services -5 Insurance services 3 Other commission income -2 Operating- and sales income real property 2 Net return on financial investments Q1 Q4 Q3 Q2 Q1 (in NOK million) Share of profit, SpareBank 1 Group and other associated companies Share of profit, Bnbank Capital gains on shares Adv. of this SpareBank 1 Midt Norge Invest* Capital gains from bonds Capital gain, SMN Markets Eksportfinans Allocation, contractual obligations Net return on financial investments As per cent of average total assets 0,16 1,34-0,10-0,01-0,21 0,16-0,21 0,28 *SpareBank 1 Midt-Norge Invest was established in third quarter 2007, and is managing a substansial part of the banks stock portfolio. Change in net return on financial investments (in NOK million) 2009 Change Total Share of profit, SpareBank 1 Group and other associated companies -24 Share of profit, Bnbank 3 Capital gains on shares 39 Capital gains from bonds 46 Capital gain, SMN Markets 6 Eksportfinans 2 Allocation, contractual obligations

14 2.4. Operating expenses Q1 Q4 Q3 Q2 Q1 (in NOK million) Wages Pension costs (defined benefit plan) Employer's insurance contributions Other personnel expenses Total personnel expenses EDP and telecommunication expenses Postage and transportation services Marketing Operating exp. on properties and premises Other external services Other operating expenses Depr./write-downs of fixed & intangible assets Other expenses Total operating expenses Operating expenses Q1 Q4 Q3 Q2 Q1 (in NOK million) Operating expenses Cost/income ratio 58 % 36 % 69 % 60 % 67 % 58 % 67 % 55 % As % of average total assets (annualized) 1,45 % 1,48 % 1,65 % 1,74 % 1,62 % 1,45 % 1,62 % 1,57 % Cost/income ratio % % % 65 % 55 % % 35 % 0 1Q08 2Q08 3Q08 4Q08 1Q09 Income Expenses Cost/income ratio * * Total operating expences as a percentage of total operating income 25 %

15 Change in operating expenses (in NOK million) 2009 Change Total Total personnel expenses 14 EDP and telecommunication expenses 2 Postage and transportation services -1 Marketing 9 Operating exp. on properties and premises 0 Other external services -3 Other operating expenses -2 Depr./write-downs of fixed & intangible assets 0 Developement of employees Employees in employment Q Retail market division Corporate market SpareBank 1 SMN Markets Business support and other Parent bank EiendomsMegler 1 Midt-Norge AS Allegro Finans AS SpareBank 1 SMN Finans AS SpareBank 1 SMN Regnskap AS SpareBank 1 Kvartalet Total Employees in employment Q Parent bank EiendomsMegler 1 Midt-Norge AS SpareBank 1 SMN Regnskap AS SpareBank 1 SMN Finans AS Other

16 3. Loans to customers 3.1. Distribution of loans by industry Q1 Q4 Q3 Q2 Q1 (in NOK million) 2009 Agriculture/forestry/fisheries/hunting Sea farming industries Manufacturing C onstruction, power and water supply Retail trade, hotels and restaurants Maritime sector Property management Business services Transport and other services provision Public administration Other sectors Gross loans in corporate market Wage earners Gross loans incl. SpareBank 1 Boligkreditt Adv. of this SpareBank 1 Boligkreditt Gross loans in balance sheet Distribution of loans by industry Wage earners 60 % Agriculture/ forestry/fisheries hunting 6 % Sea farming industries 2 % Manufacturing 3 % Other sectors 0 % Transport and other services provision 2 % Business services 3 % Property management 13 % Maritime sector 3 % Construction, power and water supply 3 % Retail trade, hotels and restaurants 4 %

17 3.2. Risk profile and write-downs Actual risk profil, Exposure At Default NOK million A B C D E F G H I J K Risk classification in SpareBank 1 SMN PD* in percent Risk class Low High A 0,00 0,10 Aaa - A3 B 0,10 0,25 Baa1 - Baa2 C 0,25 0,50 Baa3 D 0,50 0,75 Ba1 E 0,75 1,25 Ba2 F 1,25 2,50 Ba3 G 2,50 5,00 H 5,00 10,00 I 10,00 100,00 B2 J 100,00 100,00 B3-Caa/C K 100,00 100,00 B3-Caa/C Risk class A represents the lowest risk and class K the highest risk. * Probability of default B1 Corresponding ratingclass at Moody's Write-downs on loans and guarantees Q1 Q4 Q3 Q2 Q1 (in NOK million) Increase in and new individual write-downs Reassessments and recoveries Total individual write-downs Change in group write-downs on loans Write-downs on loans and guarantees

18 Individual and collective write-downs Q1 Q4 Q3 Q2 Q1 (in NOK million) Individual write-downs to cover loss on loans, guarantees at Confirmed losses in the period on loans, guarantees etc., not prev. subject to ind. write down Reversal of previous years' write downs Increase in write downs of commitments not previously subject to individual write down Write downs of loans not previously subject to individual write down Individual write downs to cover loss Collective write downs to cover loss on loans, guarantees at Period s collective write down to cover loss on loans, guarantees etc Collective write downs to cover loss on loans, guarantees Loans and guarantees by industry Default Total Very low risk Low risk Medium risk High risk Very high risk and written down Wage earners Public administration Agriculture/forestry/fisheries/hunting Sea farming industries Manufacturing Construction, power and water supply Retail trade, hotels and restaurants Maritime sector Property management Business services Transport and other services provision Finance Other sectors Q

19 Write-down ratio Q1 Q4 Q3 Q2 Q1 (in NOK million) 2009 Non-performing commitments (gross) Impaired commitments (gross) Gross non-performing and impaired commitments Individual write-downs Collective write-downs Write-down ratio (%) 42,5 % 35,9 % 17,5 % 24,8 % 24,9 % Collateral for loans Net non-performing and impaired commitments NOK million ,0 % ,78 % 1,5 % 700 0,78 % 1,0 % ,5 % 0 1Q08 2Q08 3Q08 4Q08 1Q09 Gross non-performing and impaired commitments Individual and collective write-downs As a percent of net lending 0,0 %

20 4. Capital Adequacy New rules on capital adequacy were introduced in Norway from the 1 January 2007;Basel II - the EU's new directive regarding capital adequacy. SpareBank1 SMN has applied to and got permission from Kredittilsynet to use internal rating methods (Internal Rating Based Approach - Foundation) on credit risk from 1 January This will make the statutory minimum- requirement regarding capital adequacy more risk-sensitive, and this more in accordance whit the risk in the underlying portfolios. Using IRB demands high standards regarding Using IRB demands high standards regarding organisation, competence, risk models and risk-management system. Interim regulations have been issued by Kredittilsynet, giving IRB-banks full effect of the reduced capital requirements from 2010 and onwards. In 2009, a reduction of the risk-weighted basis of calculation of 20% is allowed, while the corresponding figure for was 10%. Capital Adequacy Q1 Q4 Q3 Q2 Q1 (in NOK million) Primary capital certificates Own primary capital certificates Premium reserve Dividend equalisation reserve Savings bank s reserve Purposed dividends Unrealised gains reserve Other equity capital Result of the period and minority interests Total book equity Deferred tax, goodwill and other intangible assets Fund for unrealized gains, awailable for sale Deduction for allocated dividends % deduction for subordinated capital in other financial institutions % deduction for expected losses on IRB, net of write-downs % capital adequacy reserve Share of non-performing, non-amortizsed estimate deviations Result of the period and minority interests Year-to-date profit included in core capital (50%) Hybrid capital Total tier 1 capital Supplementary capital in excess of core capital Perpetual subordinated capital Dated subordinated capital % deduction for subordinated capital in other % deduction for expected losses on IRB, net of write-downs % capital adequacy reserve Total supplementary capital Net subordinated capital

21 Minimum requirements subordinated capital Q1 Q4 Q3 Q2 Q1 (in NOK million) Involvement with spesialised enterpises Other corporations exposure SME exposure Retail morgage exposure Other retail exposure Equity investments Total credit risk IRB Debt risk Equity risk Currency risk Operational risk Exposures calculated using the standardised approach Deductions Transitional arrangements Minimum requirements subordinated capital Capital adequacy C apital adequacy ratio 11,8 % 11,9 % 11,9 % 11,5 % 12,7 % 11,8 % 12,7 % 11,9 % Core capital ratio 8,4 % 8,1 % 8,8 % 8,5 % 8,9 % 8,4 % 8,9 % 8,1 % Capital Adequacy 12,0 % 12,7 % 11,5 % 11,9 % 11,9 % 11,8 % 8,0 % 8,9 % 8,5 % 8,8 % 8,1 % 8,4 % 4,0 % 2009 Q1 Q2 Q3 Q4 Q1 Capital adequacy ratio Core capital ratio

22 5. Funding Subordinated loan capital Q1 Q4 Q3 Q2 Q1 (in NOK million) 2009 With definite maturity 2013 fixed rate 7,2 (Call option )* mnd Nibor + 1,6 (Call option ) fixed rate 6,65 (Call option 2013)* mnd Nibor + 1,1 (Call option 2009) mnd Nibor + 0,43 (Call option 2010) mnd Nibor + 1,25 (Call option 2013) fixed rate 2,94%, JPY (Call option 2018)* Perpetual non-call Perpetual non-call 3 mnd Nibor + 0,85% (Call option 2016) Perpetual non-call 3 mnd Libor + 1%, USD 25 mill (Call option 2011) Hybrid equtiy Hybrid equity 30 years fixed rate 6,5%, USD 75 mill. (Call opt. 2013)* Total subordinated loan capital *Fixed rate transformed to floating rate trough interest rate swaps Funding maturity dates 9,0 8,0 7,0 6,0 5,0 Mill 4,0 3,0 2,0 1,0 0,

23 Capital markets funding Curr Bonds; 35 % Interbank; 21 % NOK CD's; 5 % Curr CD's; 0 % NOK Bonds; 32 % Bond Index; 0 % Other Liabilities; 0 % Perp. Sub. Loan capital; 1 % Subordinated loan capital; 5 % Hybrid Equity; 1 %

24 6. Financial results Q1 Q4 Q3 Q2 Q1 (in NOK million) Interest income Interest expenses Net interest Commission income Commission expenses Other operating income Commission income and other income Dividends Income from investment in related companies Net return on financial investments Net return on financial investments Total income Staff costs Administration costs Other operating expenses Total operating expenses Result before losses Loss on loans, guarantees etc Result before tax Tax charge Net profit Balance sheet Q1 Q4 Q3 Q2 Q Cash and receivables from central banks Deposits with and loans to credit institutions Gross loans to customers before write-down Specified write-downs Write-downs by loan category Net loans to and receivables from customers Fixed-income CDs and bonds at fair value Derivatives Shares, units and other equity interests Investment in related companies Goodwill Other assets Assets Deposits from credit institutions Deposits from and debt to customers Debt created by issue of securities Derivatives Other liabilities Subordinated loan capital Total liabilities Primary capital certificates Premium fond Dividend equalisation fund Purposed dividends Savings bank s reserve Unrealised gains reserve Other equity capital Result of the period Minority interests Total equity capital Total liabilities and equity

25 Key figures Q1 Q4 Q3 Q2 Q Return on equity 6,6 % 24,9 % 3,1 % 12,0 % 7,8 % 6,6 % 7,8 % 11,9 % Cost/income ratio group 58,1 % 36,4 % 68,9 % 60,5 % 66,7 % 58,1 % 66,7 % 54,8 % Cost/income ratio parent bank 52,4 % 57,0 % 55,3 % 50,7 % 58,1 % 52,4 % 58,1 % 55,0 % Cost/income ratio parent, ex. financial inv. 58,6 % 52,2 % 56,4 % 61,2 % 56,4 % 58,6 % 56,4 % 56,4 % Gross loans to customers* Growth in loans incl Boligkreditt last 12 months 12,6 % 15,2 % 16,3 % 16,3 % 17,2 % 12,6 % 17,2 % 15,2 % Growth in loans incl Boligkreditt this period 1,5 % 2,5 % 3,3 % 4,8 % 3,8 % 1,5 % 3,8 % 15,2 % Deposits from customers Growth in deposits last 12 months 7,6 % 8,8 % 12,0 % 10,1 % 7,5 % 7,6 % 7,5 % 8,8 % Growth in deposits this period 1,7 % -1,1 % -0,5 % 7,4 % 2,9 % 1,7 % 2,9 % 8,8 % Ordinary lending financed by ordinary deposits 55,6 % 55,1 % 56,9 % 59,3 % 56,7 % 55,6 % 56,7 % 55,1 % Total assets Average total assets Employees in employment group Employees in employment parent bank Employees in employment subsidiares Combined margin 2,17 2,61 2,49 2,35 2,44 2,17 2,44 2,48 Lending margin 1,14 0,79 0,68 0,63 0,69 1,14 0,69 0,70 Deposit margin 1,03 1,82 1,81 1,72 1,75 1,03 1,75 1,78 Net other operating income of total income 32,7 % 25,2 % 31,0 % 35,5 % 33,6 % 32,7 % 33,6 % 31,3 % Capital adequacy ratio 11,8 % 11,9 % 11,9 % 11,5 % 12,7 % 11,8 % 12,7 % 11,9 % Core capital ratio 8,4 % 8,1 % 8,8 % 8,5 % 8,9 % 8,4 % 8,9 % 8,1 % Total core capital Net subordinated capital Impairment losses ratio 0,52 % 0,10 % 0,13 % 0,00 % 0,01 % 0,52 % 0,01 % 0,21 % Non-performing commitm. as % of gross loans 0,66 % 0,46 % 0,46 % 0,47 % 0,47 % 0,66 % 0,47 % 0,46 % Other doubtfull commitm. as % of gross loans 1,12 % 1,33 % 1,11 % 0,25 % 0,37 % 1,12 % 0,37 % 1,33 % PCC price 24,30 25,17 31,67 41,67 42,50 24,30 42,50 25,17 Number of certificates issued, millions 69,43 69,43 69,43 69,43 64,77 69,43 64,77 69,43 Booked equity capital per PCC (incl. dividend) 43,24 44,10 41,26 40,83 38,92 43,24 38,92 44,10 Adjusted profit per PCC 0,60 2,66 0,32 1,20 0,81 0,74 0,81 4,94 P/E per PCC 10,09 2,36 24,36 8,70 13,10 10,09 13,10 5,

26 7. Segment information 7.1. Extract from income statement Group (in NOK million) Retail Corporate SpareBank 1 SM N Markets Eiendoms Megler 1 Midt- Norge SpareBank 1 SMN Finans Allegro Finans SpareBank 1 SM N Regnskap Uncollated Total Net interest Allocated Total interest income Commission income and other income Net profit on financial investments Total income Total operating expenses Ordinary operating profit Loss on loans, guarantees etc Result before tax Post-tax return on equity 22,3 % 8,6 % Balance sheet Loans and advances to customers adv. of this to Boligkreditt Individual allowance for impairment on loan Group allowance for impairment on loan Other assets Total assets Deposits to customers Other liabilities and equity Total liabilites Investment in owner interests Registered office Stake Shares owned by parent bank SpareBank 1 Kvartalet AS Trondheim 100 % SpareBank 1 SMN Finans AS Trondheim 100 % SpareBank 1 SMN Regnskap AS Trondheim 100 % SpareBanken Midt Norge Invest AS Trondheim 100 % Mercantor AS Trondheim 100 % Midt-Norge Fonds AS Trondheim 100 % Allegro Finans AS Trondheim 92 % EiendomsMegler 1 Midt-Norge AS Trondheim 87 % Shares owned by subsidiaries and sub-subsidiaries Sparebank 1 Bilplan AS Trondheim 100 % Berg Data AS (owned by Sparebank 1 Bilplan AS) Trondheim 80 % Mercantor Næringsmegling AS Trondheim 100 % Investment in associates Sparebank 1 Utvikling DA Oslo 18 % Boligkreditt AS Stavanger 20 % PAB Consulting AS Ålesund 34 % Investment in joint ventures Sparebank 1 Gruppen AS Tromsø 20 % BNbank ASA Trondheim 25 %

27 Income specified by segment, excluding financial investments SpareBank 1 SMN Markets; 1,6 % EiendomsMegler 1 Midt- Norge; 7,5 % SpareBank 1 SMN Finans; 5,6 % Allegro Finans; 0,5 % Corporate; 36,4 % SpareBank 1 SMN Regnskap; 3,2 % Retail; 45,2 % Interest income, Retail and Corporate Q1 Q4 Q3 Q2 Q1 (in NOK million) Retail Corporate Net interest income Developement in margin, Retail and Corporate Q1 Q4 Q3 Q2 Q1 Lending (in percentage) Retail 1,15 0,67 0,48 0,40 0,49 1,15 0,49 0,51 Corporate 1,28 1,14 1,17 1,20 1,22 1,28 1,23 1,18 Total 1,14 0,79 0,68 0,63 0,69 1,14 0,69 0,70 Q1 Q4 Q3 Q2 Q1 Deposits (in percentage) Retail 0,96 2,04 2,30 2,25 2,13 2,22 2,13 2,18 Corporate 1,10 1,57 1,30 1,16 1,29 1,27 1,28 1,32 Total 1,03 1,82 1,81 1,72 1,75 1,03 1,74 1,78 Q1 Q4 Q3 Q2 Q1 Combined margin (in percentage) Retail 2,11 2,71 2,78 2,65 2,62 3,37 2,62 2,69 Corporate 2,38 2,71 2,47 2,36 2,51 2,55 2,51 2,50 Total 2,17 2,36 2,35 2,22 2,13 2,17 2,43 2,

28 Development in volume, Retail and Corporate Q1 Q4 Q3 Q2 Q1 Lending (in NOK million) Retail Corporate Total Q1 Q4 Q3 Q2 Q1 Deposits (in NOK million) Retail Corporate Total Developement in commision income, Retail and Corporate Q1 Q4 Q3 Q2 Q1 (in NOK million) Retail Corporate Total

29 7.2. Retail division Business description Facts about the Divisjon 2009 Loans incl. interest (NOK mill.) Deposits incl. Interest (NOK mill) Other savings products (NOK mill.) Non-life insurance (NOK mill.) Personal insurance (NOK mill.) No. of debit cards No. of credit cards No. of internet bank customers No. of telephone bank customers No. of active customers FTEs Financial performance Q1 Q4 Q3 Q2 Q1 (in NOK million) Net interest income lending Net interest income deposits Net interest income allocated capital Net interest income Net guarantee commision, incl. Boligkreditt Net commision of savings products Net commision insurance services Net commision payment trans. services Net commision, Markets Other commision income Commision income Total income Total operating expences* Results Loss on loans, guarantees etc Results before tax *) Includes both direct and distributed expences Post-tax return on equity 22,3 % 23,1 % 34,0 % 29,0 % 25,1 % 22,3 % 25,1 % 27,4 % Allocated capital (in NOK mill.) Commision income Q1 Q4 Q3 Q2 Q1 (in NOK mill.) Net guarantee commision, incl. Boligkreditt Net commision of savings products Net commision insurance services Net commision payment trans. services Net commision, Markets Other commision income Commision income Commision income of total income 29,8 % 28,4 % 28,1 % 33,7 % 36,2 % 29,8 % 36,2 % 31,4 %

30 Development in margin 2,62 2,13 0,49 2,65 2,25 2,78 2,30 2,71 2,04 0,40 0,48 0,67 2,11 1,15 0, Q1 Q2 Q3 Q4 Q1 Lending margin Deposits margin Combined margin Development in lending volume Mill % ,0 % 38,6 39,7 40,2 40,9 41,2 18 % 16 % 14 % 12 % 10 % 6,9 % 8 % Q1 Q2 Q3 Q4 Q1 Lending volume incl. interest Growth in loans last 12 months 6 % Development in deposits volume Mill % ,0 % 17,0 18,4 18,2 18,3 18,2 7,6 % 10 % 8 % 6 % 4 % Q1 Q2 Q3 Q4 Q1 Deposits volume incl. interest Growth in deposits last 12 months 2 %

31 7.3. Corporate division Business description Facts about the Divisjon 2009 Loans incl. interest (NOK mill.) Deposits incl. Interest (NOK mill) Other savings products (NOK mill.) Non-life insurance (NOK mill.) Personal insurance (NOK mill.) No. of active customers FTEs Financial performance Q1 Q4 Q3 Q2 Q1 (in NOK million) Net interest income lending Net interest income deposits Net interest income allocated capital Net interest income Net guarantee commision, incl. Boligkreditt Net commision of savings products Net commision insurance services Net commision payment trans. services Net commision, Markets Other commision income Commision income Total income Total operating expences* Results Loss on loans, guarantees etc Results before tax *) Includes both direct and distributed expences Post-tax return on equity 8,6 % 4,4 % 17,8 % 16,9 % 17,0 % 8,6 % 17,0 % 15,4 % Allocated capital (in NOK mill.) Commision income Q1 Q4 Q3 Q2 Q1 (in NOK mill.) Net guarantee commision, incl. Boligkreditt Net commision of savings products Net commision insurance services Net commision payment trans. services Net commision, Markets Other commision income Commision income Commision income of total income 20,2 % 20,8 % 17,7 % 18,0 % 19,0 % 20,2 % 19,0 % 18,9 %

32 Development in margin 2,51 2,36 2,47 2,71 2,38 1,29 1,20 1,30 1,57 1,28 1,22 1,16 1,17 1,14 1, Q1 Q2 Q3 Q4 Q1 Lending margin Deposits margin Combined margin Development in lending volume ,6 26,8 25,6 24,2 22,2 21,9 % 23,2 % 2009 Q1 Q2 Q3 Q4 Q1 28,0 % 24,0 % 20,0 % 16,0 % 12,0 % Lending volume incl. interest Growth in loans last 12 months Development in deposits volume ,4 11,7 % 17,0 16,6 16,5 15,8 10,7 % 2009 Q1 Q2 Q3 Q4 Q1 18,0 % 14,0 % 10,0 % 6,0 % 2,0 % -2,0 % Deposits volume incl. interest Growth in deposits last 12 months

33 7.4. Markets SpareBank 1 Markets is an investment firm organised as a division in its own right within the Bank. The division hold the licences needed by a full-fledged investment firm, apart from licences for secondary trading of shares and active asset management. SpareBank 1 Markets has 21 experienced and competent staff. The division is organised in two sections: Fixed Income and Foreign Exchange along with Corporate Finance. Financial performance Q1 Q4 Q3 Q2 Q1 (in NOK million) Net interest income Net commision payment trans. services Net commision, Markets Other commision income Commision income Capital gain/agio Securities Total income Staff and adm. costs Other operating expenses Total operating expences Results before tax Result before tax (mill.) Cost and income (mill.) Q1 Q2 Q3 Q4 Q1 Total operating expences Total income Results before tax

34 7.5. Subsidiaries EiendomsMegler 1 Midt-Norge AS EiendomsMegler 1 Midt-Norge leads the estate agency market throughout Trøndelag and in Møre og Romsdal. In, EiendomsMegler 1 Midt-Norge sold estates. The company is owned by SpareBank 1 SMN with a 87 % share, SpareBank 1 Nordvest with 7,6 % and SpareBank 1 Volda Ørsta with 5,4 %. After a period of a pronounced fall in turnover in the industry, demand rose in the first quarter 2009, but sellers were few in number. The income lapse is partly offset by cost reductions, but the first quarter deficit of NOK 3.9 million (NOK 0.8 million) is as expected. Financial performance Q1 Q4 Q3 Q2 Q1 (in NOK million) Total interest income 0,3-0,1 1,0 0,5 1,0 0,3 1,0 2,3 Commission income and other income 36,7 21,4 33,4 47,5 35,4 36,7 35,4 137,8 Net profit on financial investments 0,0 0,0 0,0-0,2 3,5 0,0 3,5 3,3 Total income 37,0 21,3 34,4 47,8 39,9 37,0 39,9 143,4 Staff and adm. costs 27,5 17,3 30,2 21,6 27,4 27,5 27,4 96,6 Administration costs 9,7 7,1 3,9 8,4 8,0 9,7 8,0 27,4 Other operating expenses 3,7-2,4 2,7 7,3 5,3 3,7 5,3 12,8 Total operating expenses 40,9 22,0 36,8 37,2 40,7 40,9 40,7 136,7 Result before tax -3,9-0,7-2,4 10,5-0,8-3,9-0,8 6,6 Result before tax (mill.) Cost and income (mill.) 14,0 60,0 10,0 6,0 2, ,0 40,0 30,0 20,0-2,0-0,8-3,9 10,0-6, ,0 Q1 Q2 Q3 Q4 Q1 Total costs Total income Result before tax

35 SpareBank 1 Finans AS SpareBank 1 Finans Midt-Norge is the region s leading finance company in the fields of leasing and car loans. It manages a portfolio worth NOK 2.6 billion, where NOK 2.2 billion is leasing, and the rest is car loans. The company is owned by SpareBank 1 SMN with a 100 % share. The result includes a net profit of NOK 0.2 million at SpareBank 1 Bilplan AS which is a wholly-owned subsidiary of SpareBank 1 SMN Finans AS. Financial performance Q1 Q4 Q3 Q2 Q1 (in NOK million) Net interest 26,4-38,3 15,1 13,6 14,5 26,4 14,5 5 Total interest income 26,4-38,3 15,1 13,6 14,5 26,4 14,5 5 Commission income and other income 5,3 62,2 4,3 4,9 4,7 5,3 4,7 76 Net profit on financial investments -4,3 1,5-0,6 0,8 0,1-4,3 0,1 2 Total income 27,5 25,4 18,8 19,3 19,4 27,5 19,4 83 Staff and adm. costs 6,0 4,7 5,3 5,3 4,7 6,0 4,7 20 Administration costs 1,9 0,9 2,0 2,2 2,3 1,9 2,3 7 Other operating expenses 1,4 3,0 0,8 0,8 1,3 1,4 1,3 6 Total operating expenses 9,3 8,5 8,1 8,3 8,3 9,3 8,3 33 Ordinary operating profit 18,1 16,9 10,8 11,0 11,0 18,1 11,0 50 Loss on loans, guarantees etc. 8,9 21,8 2,0 1,5 4,8 8,9 4,8 30 Total costs incl. loss on loans 18,2 30,3 10,1 9,8 13,1 18,2 13,1 63 Result before tax 9,3-4,8 8,8 9,5 6,2 9,3 6,2 20 Result before tax (mill.) 10,0 6,0 2,0-2,0 6, Cost and income (mill.) 9, ,0 30,0 20,0 10,0-6, ,0 Q1 Q2 Q3 Q4 Q1 Total costs incl. loss on loans Total income Result before tax

36 SpareBank 1 SMN Regnskap AS SpareBank 1 SMN Regnskap delivers accountancy services to around 2,200 small and mid-size clients in the Bank s market areas, and trough that it is among the country s largest independent authorised accountancy firms. It specializes in the areas of corporate market, agriculture and housing cooperatives. The company is owned by SpareBank 1 SMN with a 100 % share. Financial performance Q1 Q4 Q3 Q2 Q1 (in NOK million) Net interest 0,1 0,3 0,4 0,0 0,0 0,1 0,0 0,8 Total interest income 0,1 0,3 0,4 0,0 0,0 0,1 0,0 0,8 Commission income and other income 15,5 9,6 11,0 13,9 10,5 15,5 10,5 45,0 Total income 15,6 9,9 11,4 13,9 10,5 15,6 10,5 45,7 Staff and adm. costs 11,8 5,7 8,9 11,3 6,5 11,8 6,5 32,3 Administration costs 1,3 2,0 1,7 1,5 1,0 1,3 1,0 6,2 Other operating expenses 1,1 0,8 0,9 0,5 2,0 1,1 2,0 4,2 Total operating expenses 14,3 8,5 11,4 13,3 9,5 14,3 9,5 42,7 Result before tax 1,4 1,4 0,0 0,6 1,0 1,4 1,0 3,0 Result before tax (mill.) 2,0 1,0 1, , ,4 Cost and income (mill.) 16,0 12,0 8,0 4,0-1, ,0 Q1 Q2 Q3 Q4 Q1 Total operating expenses Total income Result before tax

37 Allegro Finans AS Allegro Finans AS is a trust company with head office in Trondheim. It has a license for active management, and in addition to managing funds for its owners, Allegro Finans AS manages funds for external clients. A weak result in the first quarter 2009 reflects the negative return and market development for savings products in general. The company is owned by SpareBank 1 SMN with a 90,1 % share and Reitangruppen with 9,9 %. Financial performance Q1 Q4 Q3 Q2 Q1 (in NOK million) Net interest 0,3 0,7 0,5 0,6 0,7 0,3 0,7 2,6 Total interest income 0,3 0,7 0,5 0,6 0,7 0,3 0,7 2,6 Commission income and other income 2,2 2,4 3,3 3,8 4,0 2,2 4,0 13,5 Net profit on financial investments 0,0-0,5-0,5 0,2 0,0 0,0 0,0-0,7 Total income 2,5 2,7 3,4 4,6 4,7 2,5 4,7 15,4 Staff and adm. costs 2,1 2,4 2,2 1,9 2,4 2,1 2,4 8,9 Administration costs 0,8 1,2 0,9 1,5 0,9 0,8 0,9 4,6 Other operating expenses 0,4 0,9 0,6 0,4 0,4 0,4 0,4 2,3 Total operating expenses 3,3 4,5 3,7 3,9 3,7 3,3 3,7 15,8 Result before tax -0,8-1,8-0,3 0,7 1,0-0,8 1,0-0,3 Result before tax (mill.) 2,0 Cost and income (mill.) 8,0 0,0 1, ,8 6,0 4,0 2,0-2, ,0 Q1 Q2 Q3 Q4 Q1 Total operating expenses Total income Result before tax