There are signs of increased economic activity in the Nordic region, according to Nordea's CEO Frank Vang-Jensen. He believes it could be a turning point.
However, he adds that the outlook is also characterized by great uncertainty, in society and the world around us – including increased geopolitical tensions.
But we deliver well and we deliver as we should, says Vang-Jensen about last year's conclusion.
Wants a new repurchase program
Nordea is increasing the dividend, in line with the result. And the owners can also look forward to a new program for repurchasing shares – another form of dividend – on top of this. The bank has what is called "excess capital" in the industry.
That's our plan, says Vang-Jensen.
The repurchase program Nordea is currently using will expire at the end of February.
We want a new repurchase program when it expires, says Vang-Jensen.
Last year, Nordea continued to take market shares on the Swedish mortgage market – for the fifth year in a row, according to Vang-Jensen. But growth is slow and the bank's margins in this part of the business are being pushed down.
If we don't have market growth, there is normally price pressure. When growth increases, margins tend to normalize. And that's needed, because this must be a profitable business and right now the profitability is very low when margins are so low.
Had wanted to reduce staff "significantly"
Looking ahead, Nordea is currently investing heavily in efficiency improvements and enhancing customer experience when using the bank's services with the help of artificial intelligence (AI) in 10-15 different projects.
However, Vang-Jensen does not promise any drastic staff reductions in the wake of this.
Fact is that if you look at the last ten years, I don't think there have been fewer employees in the financial sector. You adapt, and then new things come and then you have to invest and develop.
I would like to see us reducing the number of employees significantly. We are constantly trying to drive efficiency and we have a lot to do. But I think you should be cautious about throwing out a "one-liner" about this. It's more complicated than that.
Nordea's board of directors proposes a dividend of 0.94 euro per share in the 2024 annual report, which can be compared to 0.92 euro per share the previous year. The dividend corresponds to 65 percent of the 2024 result – which is mid-range of Nordea's target interval for the dividend's share of the result.
For the fourth quarter of last year, Nordea reports a profit before credit losses of 1.52 billion euro. This can be compared to a profit of 1.50 billion euro during the same quarter the previous year.
The net interest income, what the bank earns on the difference between lending and deposit rates, decreased to 1.85 billion euro. This can be compared to 1.95 billion euro the previous year. The net commission income, however, increased by 8 percent to 825 million euro, compared to 763 million euro the previous year.
Analysts had on average expected a net interest income of 1.8 billion euro and a net commission income of 806 million euro from the fourth quarter of last year, according to a compilation of forecasts made by Bloomberg.
