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25 Oct 2023

Q3 Results 2023

Solid performance with strong cost and credit risk control
Morrow Bank delivered another good quarter with loan balance growth and stable

Commenting on the results, Morrow Bank’s CEO Øyvind Oanes said:
“In the third quarter of 2023, we delivered a solid result with an underlying loan balance growth of 5% while maintaining margins and controlling cost and credit risk.”

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
Øyvind Oanes commented further:
“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 and well-positioned for delivering growth and value creation.”

The interim report and presentation are available on Reports and presentations page