Interim reports

1 July–30 September 2021*

• Lending to the public rose 3% to SEK 32,021 million, up 3% in constant currencies. Excluding sales of non-performing loans (NPL), growth was 5%.
• Operating income fell 9% to SEK 826 million
• C/I before credit losses (excl. Insurance) was 40.5% (36.8%), and 38.8% (36.8%) excluding nonrecurring costs.
• The credit loss ratio improved to 1.2% (2.5%), excluding the dissolution of the extra credit provision of 2.2% (2.5%).
• Operating profit increased 2% to SEK 388 million, and excluding nonrecurring effects fell 13% to SEK 330 million.
• Earnings per share rose 20% to SEK 1.51 per share (1.26), before and after dilution.

1 January–30 September 2021*

• Lending to the public rose 3% to SEK 32,021 million, up 3% in constant currencies. Excluding NPL sales, growth was 5%.
• Operating income fell 8% to SEK 2,517 million
• C/I before credit losses (excl. Insurance) was 41.4% (38.0%), and 40.9% (38.0%) excluding nonrecurring costs.
• The credit loss ratio improved to 2.0% (2.8%), excluding the dissolution of the extra credit provision of 2.3% (2.5%).
• Operating profit declined 2% to SEK 1,003 million, and excluding nonrecurring effects fell 14% to SEK 944 million.
• Earnings per share rose 5% to SEK 3.87 per share (3.70), before and after dilution.
• Resurs Holding’s Board of Directors has proposed that an Extraordinary General Meeting on 2 November 2021 resolve on a distribution in kind of all of the shares in Solid Försäkring to Resurs’s shareholders, and resolve on a cash dividend of SEK 3.00 per share (a total of SEK 600 million).

Let’s go! Resurs’s strategy and offensive roadmap for the next few years took shape in the third quarter. By establishing well-defined targets and with a new, ultra-modern banking platform starting up, we are increasing the pace of our transformation journey to become a more sustainable Group with a stronger position in e-commerce and competitive offerings – for partners, customers and society as a whole.

In this third, eventful quarter we initiated a partnership with travel giant Nordic Leisure Travel Group AB (NLTG), with prominent brands such as Ving, Spies, Globetrotter and Tjäreborg, for which our assignment is to develop and expand their e-commerce platform. We have stabilised the trend in Norway where we have recently noted a negative loan portfolio. In addition, we have streamlined and strengthened our business and product development organisation, with the aim of increasing the pace of the entire process – from concept to go to market. In addition to these important milestones, we also launched Resurs Society – our concept for pooling together all our efforts in the field of sustainability.

Growth in all markets since Q2. We noted a gradual improvement in the industries and countries that experienced difficulties during the pandemic, which resulted in higher sales volumes, mainly in the second half of the third quarter. Lending increased a total of 3 per cent and the increase excluding NPL sales was 5 per cent year-on-year. It is also positive that lending rose 3 per cent compared with the end of the second quarter and we see growth in all Nordic markets and in both of our banking segments.

Operating income for the quarter declined 9 per cent year-on-year. The relatively lower income was mainly due to lower lending in Norway, lower interest income in Denmark, and mix effects in Payment Solutions. Expenses excluding nonrecurring effects were 2 per cent lower than last year, but the cost/income ratio increased as a result of lower income. Enhancing the efficiency of the operations and thus reducing the cost/income ratio is an important part of the ongoing transformation journey. Credit losses improved as a result of healthy underlying credit quality in the loan portfolio and during the quarter the Board decided to dissolve the extra credit provision of SEK 75 million that was made at the start of the pandemic. As we previously announced, we did not note any negative trend in customers’ payment patterns. On the contrary, credit quality improved. In total, operating profit increased 2 per cent year-on-year, and excluding nonrecurring effects operating profit fell 13 per cent as a result of lower income.

New financial targets. During the quarter, the Board set our new financial targets that apply from 2022, with the overall target of achieving long-term annual profit growth of more than 10 per cent. We believe that strong profit growth is the best target for creating shareholder value over time. The following targets were also introduced: a C/I ratio of 35 per cent in the mid-term, a buffer for our capital ratio of 150–300 points and a target of distributing 50 per cent of profit to shareholders. At our well-attended Capital Market Day at the end of September, we presented our new strategic framework and described how it will create the conditions for achieving these financial targets. Watch the films from the Capital Market Day and read our detailed Q&A on our website www.resursholding.se

Our new strategic framework. We are living in exciting times with the market and society undergoing extensive change, which also means that our industry is facing stronger external pressure regarding responsible credit lending. Modern-day customers have different expectations and requirements for us as a bank than in the past, and these are the foundation of our transformation as we create a new Resurs. We are convinced that a bank of the future must but the customer front and centre and that is why Customer Obsession is one of the three focus areas of our strategy. Good fundamental technology is needed to make customer experiences seamless. In a world where developments are coming fast than ever we need to be flexible, data-driven and in the cloud, and this is where the second focus area of our strategy comes in – Tech Acceleration . Our most important resource, our employees, are of course a central part of our strategy in the third focus area of Working Together. We are striving to nurture a fast, innovative and empowering corporate culture with an agile working method.

Growth and stronger position in e-commerce. A central factor in achieving our financial targets is to increase the rate of growth for both our banking segments and in all of our markets. We are doing this by enhancing our competitiveness and developing our e-commerce position and initiating new partnerships. Throughout 2021, we have seen higher demand for our e-commerce solutions, and through our partnership with travel giant NLTG we are advancing in the right direction.

It is gratifying that the negative trend in the Norwegian market stabilised during the quarter, but we continue to see challenges and a high share of customers who are ending their loans in advance. In the fourth quarter, we will focus even more on activities to raise customer satisfaction and sales towards our database. We will also launch loans with collateral in Norway, known as priority loans, up to a maximum of NOK 600 thousand.

First in the Nordic with cloud-based banking platform. We took an important first step in replacing our core banking system and signed an agreement with the global cloud platform provider Intellect Design Arena. The new platform gives us the strength and prerequisites to provide customers and partners with state-of-the-art services, interfaces and products. Our investment will amount to about SEK 500 million and the development process for integrating the cloud-based banking platform will begin now and is planned to be gradually introduced over the next few years.

Operational advances. In parallel with replacing our banking system, we are using digitisation to make our operations more effective and to increase customer satisfaction. For example, by following a data-driven work method we are improving our application flows and developing our customer interface. Our proprietary app is now live in all of the Nordic countries and this quarter we also launched a new function in the Resurs app that gives our existing customers in Sweden the opportunity to increase their loans instead of needing to go via the website or calling our customer service centre. Another central area is developing our e-commerce solutions, and Trustly – a new payment method – and the option for customers to raise their account limit directly in our checkout were launched in the third quarter.

Board proposes distribution of Solid. Solid’s operations continued to perform positively in the third quarter and excluding IPO costs the technical result increased 13 per cent compared with the year-earlier quarter. However, total operating profit declined 13 per cent due to the strong recovery in the investment portfolio in the third quarter last year.

At the start of October, the Board gave notice of an Extraordinary General Meeting to be held on 2 November 2021 to resolve on a Lex Asea distribution of the subsidiary Solid Försäkring. The aim is to list Solid Försäkring on Nasdaq Stockholm’s main market during the fourth quarter. The initiative is based on the ambition to give Solid Försäkring the best prerequisites to continue its journey of growth and to provide opportunities for creating significant value for shareholders over time. 

We are looking ahead. Put simply, it has been an eventful year and we are looking forward to accelerating the pace of our continuing transformation. Many exciting features are expected in the near future and we are preparing for just as productive a fourth quarter.

Nils Carlsson, CEO Resurs Holding

More information:
Nils Carlsson, CEO, nils.carlsson@resurs.se; +46 42 382000
Sofie Tarring Lindell, CFO & Head of IR, sofie.tarringlindell@resurs.se; +46 736 443395

This information is information that Resurs Holding AB is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 07:30 CET on 26 October 2021.

About Resurs Holding
Resurs Holding (Resurs), which operates through the subsidiaries Resurs Bank and Solid Försäkring, is the leader in retail finance in the Nordic region, offering payment solutions, consumer loans and niche insurance products. Since its start in 1977, Resurs Bank has established itself as a leading partner for sales-driven payment and loyalty solutions in retail and e-commerce, and Resurs has thus built a customer base of approximately 6 million private customers in the Nordics. Resurs Bank has had a banking licence since 2001 and is under the supervision of the Swedish Financial Supervisory Authority. The Resurs Group operates in Sweden, Denmark, Norway and Finland. At the end of the third quarter of 2021, the Group had 664 employees and a loan portfolio of SEK 32.0 billion. Resurs is listed on Nasdaq Stockholm.

* Certain performance measures provided in this section have not been prepared in accordance with IFRS or the capital adequacy rules, meaning that they are alternative performance measures. Calculations and reconciliation against information in the financial statements of these performance measures are provided on the website under “Financial reports.” Definitions of performance measures are provided on the website under “Financial data.”