Nordea Bank’s net profit jumped to £761.14 million in the third quarter of the financial year.
The Helsinki-based bank reported net interest income of £1.05 billion for the third quarter.
The financial services group has committed to pay a dividend for 2019.
In its report on Friday, Nordea Bank Abp (STO: NDA-SE) said its net profit for the third quarter was higher than expected. The company attributed the increase to lower costs, increased lending and the reversal of credit losses in the last quarter.
Nordea closed flat in the equity market on Friday. So far this year, the company’s shares have fallen by about 8%, but have rallied by almost 40% since March. Confused about choosing a reliable stockbroker for online trading? Here is a list of the few providers to help you make your choice.
Nordea reports net interest income of £1.05 billion in 3rd quarter
The Helsinki-based bank reported a net profit of £761.14 million in the third quarter, significantly higher than the loss of £101.91 million in the same quarter last year. According to FactSet, experts had forecast a lower net profit of £633.83 million for Nordea in the third quarter.
Net interest income, according to the financial services group, jumped to £1.05 billion in the third quarter of the financial year, compared with £980 million in the same period last year. The FactSet Consensus for net interest income amounted to 1.01 billion pounds sterling. In the previous quarter (Q2), Nordea had seen a massive 66% decline in operating profit.
Nordea valued the reversal of loan losses in the third quarter at £1.82 million, compared to £65.47 million. However, the bank did not change its long-term forecast for loan losses due to the coronavirus pandemic, which it said was likely to continue to pose challenges for some customers in the coming months. Nordea forecasts net credit losses of less than £910 million in 2020.
Nordea Bank has committed to pay a dividend for 2019.
The Finnish bank expects the cost base this year to be below 4.27 billion pounds sterling. By 2022 Nordea aims to increase its cost/income ratio to 50% and return on equity to more than 10%. In the last quarter, the bank’s CET1 (Common Equity Tier 1) ratio increased to 16.4% compared to 15.4% in the third quarter of 2019.
Nordea committed on Friday to pay a dividend for 2019. The decision on the dividend payment will be announced before the beginning of the new year. Last month Nordea appointed Ian Smith as the Group’s new CFO. Smith will assume this role on 24 October.
The Helsinki-based bank only gained about 2% in the stock market last year. At the time of writing, Nordea is valued at £25 billion and has a price-earnings ratio of 25.11.