Instabank : Presentation – Q3 23

Interim

presentation Q3-2023

November 2nd, 2023

Key highlights

Record-high net profit after tax: 28.2 MNOK

53 % increase from the same quarter last year

Record-high growth in net loans: 460 MNOK

Growth year to date: 1,013 MNOK

Successful launch of B2B Credit line product

37 MNOK in net lending

Net loans and margin

developments

Net loan development | Well diversified loan book

NET LOAN BALANCE GROWTH (MNOK)

KEY COMMENTS:

195

93

116	191
75

	438
207	232

120

109

466

260 170

37

•	Record-high growth in net loans of 466 MNOK, YTD 1,013 MNOK
•	Mortgages lending increased by 260 MNOK, the second highest

				(11)
Q3-22	Q4-22	Q1-23		Q2-23	Q3-23
Mortgages		Unsecured loans		B2B Credit line	Total

quarterly growth

• Mortgages represents 63% of net loans in Norway and 41 % of total net

loans, representing lower credit risk than for unsecured loans

NET LOANS TO CUSTOMERS (MNOK)

		5,056	5,165	5,631
	4,618
4,427
		1,955	2,075	2,335
1,632	1,748
			37
2,795	2,870	3,101	3,090	3,260

•

•

Successful launch of the new credit line product for SMEs

Well diversified loan book across products and markets reduces risk

Q3-22

Q4-22

Q1-23

Q2-23

Q3-23

Unsecured loans		B2B Credit line		Mortgages	Series3

Yields and funding cost | Attractive margins

LENDING AND LIQUIDITY YIELD. INTEREST RATE DEPOSITS:

KEY COMMENTS:

10.8 %

6.4 %

1.2 %

-1.5 %

11.3 %

7.1 %

1. %

1. %

11.6 %

7.6 %

2.5 %

12.0 %

8.3 %

1. %

1. %

12.1 %

1. %
2. %

1. %

• Rate hike on loans effective in August following the 0.5 % increase from the Norwegian Central Bank in June
• Deposit rates developments influenced by markets rates as well as increased competition from saving banks
• Liquidity yield outperformed funding cost, making surplus liquidity profitable

Q3-22	Q4-22	Q1-23		Q2-23	Q3-23
	Liquidity yield			Interest rate deposits
	Yield - consumer loans			Yield - mortgages

Diversified loan portfolio| Transparent and simple

Net Loans	# Customers	Avg Ticket Size	Yield

Consumer Loans

Unsecured loans offered in Norway, Finland and Sweden

Mortgages

First or second priority mortgages for refinancing of unsecured debt or house improvements

2,743''

27,528

99'

2,335'' 2,479 942'

12.1 %

8.5 %

Credit Card

Most attractive credit card in the market for revolving credit customers

Sales Finance

Point of sale or web payment solutions offered through retail partners like Skeidar and Coop

306''

6,675

46'

210''

22,871

9'

15.7 %

13.4 %

B2B Credit Line

Credit line product for small and medium sized	37''	48	763'
enterprises
Total	5,631''	59,601	94'

17.7%

10.9 %

Well diversified loan portfolio

Deposits volumes | Diversified funding

	Volume	# Customers	Avg. Deposit Size
Norway	3,527''	13,001	271'

Finland

162''

4,092

40'

Germany

1,966''

11,934

165'

Sweden

17''

1,760

10'

Avg. deposit rate

4.0 %

1.1%

1. %

1. %

Total	5,672''	30,787	184'	3.6 %

Profitability, risk

and capital

Total income | High growth in income

TOTAL INCOME (MNOK):

112.4

98.0

100.8

102.8

86.2

Q3-22

Q4-22

Q1-23

Q2-23

Q3-23

TOTAL INCOME DETAILED (MNOK):

22.3

		17.0	13.6
	16.6
5.7
		120.9	134.3	146.9
	109.3
98.9
-18.5	-28.0	-37.1	-45.1
	-56.7
Q3-22	Q4-22	Q1-23	Q2-23	Q3-23

KEY COMMENTS:

• Total interest income increased by 45.9 MNOK from the same quarter last year, driven by a 12-month net loan growth of 1,204 MNOK and increased loan yield to 10.6 % from 8.9 %
• The increase in interest expenses comes from higher deposit rates as well as an increased deposit volume of 373 MNOK in Q3-23
• Net other income was up 8.7 MNOK from Q2-23 resulting from a high yield on security holdings of 5.6% due to higher market rates and positive changes in value

Total Interest income		Interest expenses		Net other income

Operating expenses | Demonstrating economy of scale

OPERATING EXPENSES BREAKDOWN (MNOK):

									39.7		42.3
38.0		36.1		38.4				1.7
					2.3
					1.8
	2.0
			1.9				17.8
						16.0
14.0			15.2
11.6
3.6		3.0		2.7		2.8		3.9
15.1	16.3	15.7	15.4	15.8
3.3		3.3		2.9		3.1		3.2
Q3-22	Q4-22	Q1-23		Q2-23	Q3-23
	Depreciation and amortisation					Other administrative expenses
	Direct marketing costs					Salary and other personell expenses
	Other expenses

COST/INCOME RATIO:

44%
40%
					39%
				38%			38%
		37%
		35%		36%
							34%
		34%

KEY COMMENTS:

• Increase in personnel expenses comes from full effect of annual salary increase and new hires
• Marketing cost increase relates to marketing of the new B2B credit line product
• The cost-to-income ratio decreased to 38 % from 44 % in the same quarter last year, demonstrating economy of scale

Q3-22

Q4-22

Q1-23

Q2-23

Q3-23

Cost ex marketting cost/ income ratio		Cost/ income ratio