Oma Savings Bank Plc’s Financial Statements Release 1 January – 31 December 2023: Record result and additional dividend to shareholders

OMA SAVINGS BANK PLC, STOCK EXCHANGE RELEASE 5 FEBRUARY 2024 AT 8.30 A.M. EET, FINANCIAL STATEMENTS RELEASE

Oma Savings Bank Plc’s Financial Statements Release 1 January – 31 December 2023: Record result and additional dividend to shareholders

This release is a summary of Oma Savings Bank’s (OmaSp) January-December 2023 Financial Statements Release, which can be read from the pdf file attached to this stock exchange release and on the Company’s web pages www.omasp.fi

CEO Pasi Sydänlammi: Record result and additional dividend to shareholders
"OmaSp's business development continued on the path of strong growth in the financial year 2023. Profit development was boosted by the transaction carried out in the early part of the year and the rise in market interest rates. The unique combination of growth and profitability is reflected in a strong accumulation of equity, which enables owners to achieve record profit distribution as well as investments to enable future success.

Continued development of net interest income throughout the year continued in the last quarter of the year and the growth was 88% compared to the previous year. The rise in fee and commission income and expenses also continued during the fourth quarter and full-year commission and fee and commission income and expenses increased by 20% compared to the previous year. The development of customer numbers remained at a good level. With the acquisition of Liedon Savings Bank's business, we received about 50,000 new customer relationships and in addition to this, about 1,000 new customer relationships were organically created every month.

Strong business development is reflected in a significant increase in equity. The equity exceeds 500 million for the first time for the full year and was approximately EUR 541 million at the end of the year. The full-year comparable return on equity (ROE%) reached a record level of 25.3%. During the financial year, the comparable cost/income ratio improved further and was 35.1% including authority fees.

The quality of the credit portfolio has remained at the expected level despite the uncertain economic situation. OmaSp continued to prepare for the weakening cyclical situation and additional allowances based on the management's judgement of EUR 8.3 million are for use. We recognised a total of EUR 10.6 million in ECL in profit or loss for the financial year.

For the year 2023, profit before taxes was EUR 138 million. The full-year comparable profit before taxes increased by 89% compared to the comparison period and was EUR 143.6 million. The balance sheet total was EUR 7.6 billion and grew by over EUR 1.7 billion during the financial year.

Profitable growth continues
OmaSp's constantly strengthening ability to generate profit enables a growing dividend for the owners for the seventh year in a row. A dividend of EUR 1.00 per share is proposed for the spring Annual General Meeting, of which the actual dividend is EUR 0.67 and an additional dividend of EUR 0.33 per share due to the record result and exceptionally strong net interest income.

Profitable growth is expected to continue in the financial year 2024. In addition to organic growth, we will continue to strengthen our market position with the acquisition of Handelsbanken's SME business in Finland in the autumn. At the same time, our operations are expanding in the Helsinki metropolitan area to Vantaa and the economic areas of Kuopio and Vaasa. OmaSp is once again starting the financial year from an excellent starting point.

Warm thanks to all customers, personnel, owners and partners for 2023!"

January-December 2023
• In January–December, net interest income grew strongly by 87.8% compared to the previous year. Net interest income totalled EUR 197.0 (104.9) million. Net interest income was increased especially by the rise of market interest rates, and in addition, the volumes that have increased with the acquisition of Liedon Savings Bank's business since March.
• In the last quarter, net interest income increased by 85.8% compared to the comparative period and totalled EUR 56.9 (30.6) million.
• Home mortgage portfolio increased by 25.7% during the previous 12 months. Corporate loan portfolio increased by 14.8% during the previous 12 months.
• Deposit base grew by 19.9% over the previous 12 months.
• In January–December, fee and commission income and expenses (net) item increased due to volume growth by 20.4%. In the last quarter, fee and commission income and expenses (net) item grew by 47.9% compared to the previous year.
• In January–December, total operating income grew by 71.1% and in the last quarter 69.2% compared to the previous year.
• Total operating expenses grew in total by 23.9% during the year and by 25.5% in the last quarter. The increase in expenses can be explained by the expanded branch network due to the corporate restructuring, increased authority fees and IT development costs.
• The impairment losses on financial assets were in total EUR -17.1 (-1.7) million for the year 2023. The growth was affected by the Company’s preparedness for the uncertainty of the general economic situation and in advance made write-downs, of which the profit impact of an individual customer was EUR 5 million. At the end of the financial year, additional loss allowances based on the management's judgement and fair value adjustments remain for the use by the Company in total EUR 8.3 million.
• In the last quarter, the impairment losses on financial assets were in total EUR -7.3 (-1.3) million. The Company continued to prepare for the uncertainty of the economic environment, and the impact of the additional allowance based on management's judgement, recorded in the last quarter, was EUR -1.0 million. The profit impact of the write-down on an individual customer was EUR -1.3 million.
• For the financial year 2023, profit before taxes increased and was in total EUR 138.0 (69.2) million. The growth was 99.4% compared to the previous year.
• For the last quarter, profit before taxes grew 84.3% and was in total EUR 35.5 (19.3) million.
• For the financial year 2023, comparable profit before taxes grew 89.3% compared to the previous year and was in total EUR 143.6 (75.9) million.
• For the last quarter, comparable profit before taxes grew 86.9% and was EUR 38.8 (20.8) million.
• For the whole year, cost/income ratio improved and was 36.9 (50.7)%. Comparable cost/income ratio improved and was 35.1 (48.0)%.
• In the last quarter, cost/income ratio improved and was 35.4 (47.6)%. Comparable cost/income ratio improved and was 32.8 (44.1)%.
• Comparable return on equity (ROE) improved and was 25.3 (15.8)% for the whole year and 23.5 (18.4)% in the last quarter.

Outlook for the financial year 2024:
The Company's profitable growth will continue driven by investments in customer experience and service network. The SME customer business to be acquired from Handelsbanken will improve the Company’s profitability from the second half of 2024 onwards.

We estimate the Group's comparable profit before taxes to remain at the current excellent level in the financial year 2024 (comparable profit before taxes was EUR 143.6 million in financial year 2023).

Board of Directors’ proposal for the distribution of profit to AGM
The Board of Directors proposes that, based on the Financial Statements to be approved for 2023, an actual dividend of EUR 0.67 and an additional dividend of EUR 0.33 to be paid from the Parent Company’s distributable profits for each share entitled to a dividend for 2023. The actual dividend is in line with the Company's dividend policy and an additional dividend is proposed due to the record result for the financial year 2023 and exceptionally strong Net interest income.

General Meeting
The Annual General Meeting is scheduled to be held on 26 March 2024. The Company's Board of Directors will convene the Annual General Meeting separately at a later date.

Oma Savings Bank Plc

Additional information:
Pasi Sydänlammi, CEO, puh +358 45 657 5506, pasi.sydanlammi@omasp.fi
Sarianna Liiri, CFO, puh. +358 40 835 6712, sarianna.liiri@omasp.fi
Minna Sillanpää, CCO, tel. +358 50 66592, minna.sillanpaa@omasp.fi

DISTRIBUTION
Nasdaq Helsinki Ltd
Major media
www.omasp.fi

OmaSp is the fastest growing in the Nordic countries and Finland’s most profitable bank. About 500 professionals provide nationwide services through OmaSp’s 45 branch offices and digital service channels to over 200,000 private and corporate customers. OmaSp focuses primarily on retail banking operations and provides its clients with a broad range of banking services both through its own balance sheet as well as by acting as an intermediary for its partners’ products. The intermediated products include credit, investment and loan insurance products. OmaSp is also engaged in mortgage banking operations.

OmaSp core idea is to provide personal service and to be local and close to its customers, both in digital and traditional channels. OmaSp strives to offer premium level customer experience through personal service and easy accessibility. In addition, the development of the operations and services is customer-oriented. The personnel is committed and OmaSp seeks to support their career development with versatile tasks and continuous development. A substantial part of the personnel also own shares in OmaSp.

Attachment

• OmaSp Financial Statements Release 31 December 2023