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Nordea Q1 profit tops forecast as interest rates rise

Published 04/27/2023, 12:47 AM
Updated 04/27/2023, 01:00 AM
© Reuters. FILE PHOTO: The Nordea bank logo is seen at the bank's headquarters in Stockholm, Sweden, May 7, 2017. REUTERS/Ints Kalnins/File Photo

HELSINKI (Reuters) -The Nordic region's biggest lender Nordea posted a larger than expected gain in first-quarter operating profits on Thursday, on the back of rising interest rates and despite weaker Nordic currencies.

The Finnish banking group reported an operating profit of 1.48 billion euros ($1.64 billion) in the quarter, up from 1.1 billion a year ago, beating the mean forecast of 1.36 billion in a Refinitiv poll of analysts.

The rise in results followed a similar trend among other Nordic banks such as Swedish rival SEB, which on Wednesday beat market expectations and reported higher net interest income.

"Despite slowing economic activity, our lending volumes continued to develop positively," Chief Executive Frank Vang-Jensen said in a statement.

    The bank saw its net fee and commission income decline 8% year on year to 765 million euros. Net interest income climbed 35% to 1.77 billion euros.

    Nordea's return on equity for the quarter increased to 17.1% from 12.6% a year ago and the bank reiterated it expects it to exceed 13% for the full year 2023.

© Reuters. FILE PHOTO: The Nordea bank logo is seen at the bank's headquarters in Stockholm, Sweden, May 7, 2017. REUTERS/Ints Kalnins/File Photo

Nordea said individual net loan losses remained low despite the Nordic economies slowing and kept its management judgement buffer unchanged at 585 million euros.

($1 = 0.9049 euros)

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