Nordax Bank reports Q3 profit above expectations

Nordax Bank reported third-quarter pre-tax operating profit of SEK 1.67 billion, beating market expectations by 9%.

The Swedish lender’s profit came in 2% below UBS estimates. Revenue reached SEK 80 million above consensus forecasts, rising 2%, while credit losses came in 7% lower than expected at SEK 65 million. Operating costs were 2% higher than analyst predictions.

Net interest income exceeded expectations by 2%, supported by strong loan volumes of SEK 151 billion, which grew 12% quarter-on-quarter on an annualized basis in local currency terms. Fee income fell short of forecasts by 1%, and net financial transactions posted a small loss.

The bank’s credit loss ratio stood at 2.4% of loans. The figure benefited from non-performing loan sales completed during the quarter at prices above book value, though the bank did not disclose the gain amount.

Nordax Bank’s Common Equity Tier 1 ratio reached 13.2%, falling 20 basis points below market expectations as loan growth and foreign exchange movements increased risk-weighted assets.

The bank maintained its medium-term targets, including organic loan growth above 10%, a cost-to-income ratio below 20% during 2027, core return on tangible equity of around 30%, and a CET1 ratio of 13% to 15% with a 40% payout ratio. The third-quarter core ROTE reached 29.6%.

Nordax Bank proposed an interim dividend of SEK 2.70 per share, 2% above UBS estimates. The bank said it expects elevated cost growth to decline by the end of 2026. Third-quarter costs rose 6% quarter-on-quarter.

The underlying net interest margin remained stable at 8.3%. The bank said it expects quarterly volatility ahead as higher interest rates are reflected in pricing.