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Introduction & Market Context
SpareBank 1 Ringerike Hadeland delivered robust financial results for the second quarter and first half of 2025, as presented in its quarterly report on August 14, 2025. The Norwegian regional bank reported a 36% increase in profit compared to the same period last year, driven by solid underlying banking operations and significant financial gains.
The bank continues to maintain its dominant position in its primary market area, with 35% market share in the private market, 53% in the business market, and 45% in real estate brokerage. With approximately 70,000 customers, SpareBank 1 Ringerike Hadeland leverages its strong local presence while benefiting from its membership in the broader SpareBank 1 alliance.
Quarterly Performance Highlights
SpareBank 1 Ringerike Hadeland reported a profit after tax of 391 million NOK for the first half of 2025, representing a substantial 36% increase from 287 million NOK in the same period of 2024. The second quarter alone contributed 244 million NOK to this result, significantly higher than the 141 million NOK recorded in Q2 2024.
Return on equity (ROE) reached 15.8% in Q2 2025, up from 10.4% in Q2 2023, demonstrating the bank’s strong profitability. The bank noted that when adjusted for extraordinary income related to the sale of SamSpar-selskaper, the ROE would be 13.5% - still well above the bank’s target of 11%.
As shown in the following chart highlighting key financial metrics and ROE development:
The bank’s Common Equity Tier 1 (CET1) capital ratio stood at a solid 19.5%, having increased by 2.7 percentage points in Q2 due to the implementation of CRR3 regulations. This level significantly exceeds the bank’s minimum target of 15.9%, providing substantial financial flexibility and dividend capacity.
Detailed Financial Analysis
The bank’s performance was driven by multiple factors, with a detailed breakdown of the year-over-year result change illustrated in this waterfall chart:
Net interest income showed modest growth of 1.7% compared to H1 2024, with the bank acknowledging that growth in this area is slowing down. The trend in net interest income over recent years shows steady improvement, though the percentage of average managed capital has slightly decreased to 1.95% in H1 2025 from 2.01% in 2024:
The changes in net interest income were influenced by several factors, including higher loan interest income (+10 million NOK) and increased commissions from credit institutions (+10 million NOK), partially offset by higher deposit interest costs (-37 million NOK) and securities interest costs (-28 million NOK):
A significant contributor to the strong results was the performance of financial items, which generated a gain of 151 million NOK. This represents a substantial increase compared to previous periods and includes contributions from SpareBank 1 Gruppen:
The bank also reported strong growth in other income sources, particularly in insurance, which benefited from improved profitability commissions and increased new sales. Other important contributors included real estate brokerage services, which saw good activity in the used housing market, and increased income from Økonomihuset:
Strategic Initiatives
SpareBank 1 Ringerike Hadeland continues to focus on three strategic priorities: delivering the best customer service, leveraging economies of scale within the SpareBank 1 alliance, and building local communities beyond traditional banking services.
The bank’s presentation outlined ten reasons to believe in its future prospects, highlighting its strong brand, powerful alliance membership, cost-effectiveness, dividend capacity, solid banking practices, and growth opportunities:
The bank is also maintaining its financial goals, with current performance exceeding targets across profitability, solidity, and dividend distribution metrics:
Forward-Looking Statements
Looking ahead, SpareBank 1 Ringerike Hadeland faces both opportunities and challenges. While the bank benefits from its position in an attractive region with growth potential around Oslo and ongoing infrastructure projects, it is experiencing slowing loan growth in both personal and business markets.
Personal market loan growth stood at 2.1% over the last 12 months, while business market growth was 2.6%. In contrast, deposit growth remains strong in the personal market at 9.0%, though the business market is showing negative growth.
Cost growth remains a challenge, driven by the full-year effects of employees hired in 2024, as well as increased ICT and alliance costs. Despite this, the bank maintains an efficient operation with a cost percentage of 30.7%.
The bank’s stock (RING) closed at 385 NOK on August 14, 2025, trading within its 52-week range of 294.50 to 415 NOK.
With its solid capital position, diversified income streams, and strong market presence, SpareBank 1 Ringerike Hadeland appears well-positioned to navigate the evolving financial landscape while continuing to deliver value to shareholders through its commitment to a dividend payout ratio of at least 60%.
Full presentation:
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