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256369
Moderate results for banks
statistikk
2016-05-24T10:00:00.000Z
Banking and financial markets
en
banker, Banks and mortgage companies, finance companies, state lending institutions, loans, deposits, financing, mortgages, bonds, commercial papers, shares, ownership interest, assets, liabilities, foreign banks, borrowersFinancial institutions and other financial corporations, Banking and financial markets
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Banks and mortgage companies, Q1 2016

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Moderate results for banks

Norwegian banks’ pre-tax profit amounted to NOK 10.5 billion in the 1st quarter of 2016; a slight decline compared to the same quarter in 2015. The moderate result stemmed from lower net value changes and moderate growth in net interest income.

Main figures. NOK millionPublished 24 May 2016
March 2015March 2016Percentage change
Banks
Total assets4 700 7954 827 7052.70
Net interest income15 14516 92111.73
Loss on loans8561 970130.14
Pre-tax profit11 68210 490-10.20
Mortgage companies
Total assets1 967 2642 010 4242.19
Net interest income4 7233 775-20.07
Loss on loans-560-1 300.00
Pre-tax profit4 3122 950-31.59

Source: Statistics Norway

Norwegian banks’ profit before tax as a share of average total assets was 0.22 per cent in the 1st quarter of 2016; a decrease from 0.25 per cent in the same quarter last year.

Increased net interest income

In the 1st quarter of 2016, the banks’ net interest income amounted to NOK 16.9 billion. This is NOK 1.8 billion higher than in the same quarter the previous year. Net interest income as a share of average total assets was 0.35 per cent in the 1st quarter this year.

Lower net gains and moderate loan losses

The banks' total net change in value and net gains on securities, currency and other financial instruments was NOK 0.5 billion in the 1st quarter of 2016; a decrease of NOK 1.1 billion compared to the same quarter last year. In the 1st quarter of 2016, the loan losses were NOK 2 billion; an increase of NOK 1.1 billion from the same quarter last year. As a share of total assets, the bank’s loss on loans in the 1st quarter this year was 0.04 per cent.

Larger share of claims on customers and stable share of funding

At the end of the 1st quarter of 2016, loans to and claims on customers were 55.6 per cent of the banks’ total assets. Compared to the end of March 2015, this share has increased by 1.9 percentage points. Loans to and claims on credit institutions as a share of total assets decreased by 2.3 percentage points in the same period.

Norwegian banks are mostly funded by deposits and certificates and bonds. Deposits constitute the largest source of funding, with a share of 65.6 per cent of total assets by the end of the 1st quarter of 2016, while the certificates and bonds’ share of total assets was 14.1 per cent. Compared to the end of the 1st quarter of 2015, the deposits’ share of total assets fell by 1.8 percentage points, while the bonds’ share increased by 0.2 percentage points.

Moderate results also for mortgage companies

Norwegian mortgage companies’ pre-tax profit was NOK 3.0 billion in the 1st quarter this year; a decrease of NOK 1.4 billion compared to the same period of 2015. The pre-tax profits’ share of total assets was 0.15 per cent in the 1st quarter of 2016.

Total net change in value and net gains on securities, currency and other financial instruments was NOK 0.8 billion in the 1st quarter this year; a decrease of NOK 0.8 billion from the same quarter last year. The net interest income for mortgage companies amounted to NOK 3.8 billion in the 1st quarter this year; a decrease of NOK 0.9 billion in the same period last year.