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1. Company Snapshot

1.a. Company Description

SpareBank 1 Østlandet provides various financial products and services to individuals, businesses, the public sector, clubs, and societies.The company offers deposits, financing, savings, advisory, life and non-life insurance, and pension products and services.It also provides credit cards; and leasing, money-transfer, capital and investment management, debt recovery, real estate brokering and rental, factoring, trade and corporate finance, and accounting related services.


It has 36 branches in Innlandet, Oslo, and Viken.The company was founded in 1845 and is headquartered in Hamar, Norway.SpareBank 1 Østlandet is a subsidiary of Sparebankstiftelsen Hedmark.

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1.b. Last Insights on SPOL

SpareBank 1 Ostlandet's recent performance has been driven by strong fundamentals and strategic insider buying activity. The bank's solid financial position, characterized by a high common equity tier 1 (CET1) ratio, has enabled it to maintain a strong capital buffer. Additionally, the bank's focus on cost efficiency and digitalization initiatives has improved its operational resilience. Insider buying activity has also been notable, with several executives and board members purchasing shares in recent months, signaling confidence in the bank's prospects.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (5.50%)

6. Segments

Retail Division

Expected Growth: 5.5%

The 5.5% growth in Retail Division of SpareBank 1 Ostlandet is driven by increasing demand for digital banking services, strategic expansion into new markets, and a strong focus on customer experience. Additionally, the bank's efforts to enhance its mobile banking platform and introduce innovative payment solutions have contributed to the growth.

Corporate Division

Expected Growth: 5.8%

SpareBank 1 Ostlandet's Corporate Division growth of 5.8% is driven by strong loan growth, increased deposit margins, and cost control measures. The division's focus on digitalization and customer-centric approach has improved operational efficiency, leading to higher profitability. Additionally, the bank's strong risk management and solid capital position have enabled it to take advantage of growth opportunities in the region.

Other Operations

Expected Growth: 4.2%

SpareBank 1 Ostlandet's 4.2% growth in Other Operations is driven by increased lending to small and medium-sized enterprises, expansion of digital banking services, and strategic partnerships with local businesses, resulting in higher transaction volumes and fee income.

SpareBank 1 Finans Ostlandet

Expected Growth: 6.2%

SpareBank 1 Finans Ostlandet's 6.2% growth is driven by strong lending growth in the mortgage and consumer loan segments, supported by a robust economy in the Ostlandet region. Additionally, the bank's digitalization efforts and cost savings initiatives have improved operational efficiency, contributing to the growth.

Eiendoms-Megler 1 Oslo Akershus

Expected Growth: 5.0%

Eiendoms-Megler 1 Oslo Akershus's 5.0% growth is driven by SpareBank 1 Ostlandet's strong market presence, increasing demand for real estate services in the Oslo and Akershus regions, and the bank's strategic expansion into digital platforms, enhancing customer experience and driving revenue growth.

SpareBank 1 Forretnings-Partner Ostlandet

Expected Growth: 6.5%

SpareBank 1 Forretnings-Partner Ostlandet's 6.5% growth is driven by strong lending growth in the corporate segment, fueled by a robust Norwegian economy and increasing demand for credit. Additionally, the bank's focus on digitalization and cost efficiency measures have improved operational efficiency, contributing to the growth.

Eiendoms-Megler1 Hedmark Eiendom

Expected Growth: 4.8%

Eiendoms-Megler1 Hedmark Eiendom's 4.8% growth is driven by increasing demand for housing in the Ostlandet region, fueled by SpareBank 1's strong brand presence and competitive mortgage offerings. Additionally, the region's growing population, low unemployment, and rising disposable income contribute to the segment's growth.

7. Detailed Products

Personal Banking

SpareBank 1 Ostlandet offers a range of personal banking services, including current and savings accounts, credit cards, loans, and mortgages.

Business Banking

The bank provides a variety of business banking services, including business loans, credit facilities, cash management, and trade finance.

Investment and Wealth Management

SpareBank 1 Ostlandet offers investment and wealth management services, including portfolio management, investment advice, and pension planning.

Insurance

The bank provides a range of insurance products, including life insurance, non-life insurance, and pension insurance.

Real Estate Financing

SpareBank 1 Ostlandet offers financing solutions for real estate development, construction, and property acquisition.

Digital Banking

The bank provides online and mobile banking services, enabling customers to manage their finances, pay bills, and transfer funds digitally.

8. SpareBank 1 Ostlandet's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes is low for SpareBank 1 Ostlandet as the bank offers a unique range of financial services that are not easily substitutable.

Bargaining Power Of Customers

The bargaining power of customers is medium for SpareBank 1 Ostlandet as customers have some degree of bargaining power due to the availability of alternative banking services.

Bargaining Power Of Suppliers

The bargaining power of suppliers is low for SpareBank 1 Ostlandet as the bank has a strong negotiating position with its suppliers.

Threat Of New Entrants

The threat of new entrants is high for SpareBank 1 Ostlandet as the banking industry is highly competitive and new entrants can easily enter the market.

Intensity Of Rivalry

The intensity of rivalry is high for SpareBank 1 Ostlandet as the banking industry is highly competitive and there are many established players in the market.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 70.48%
Debt Cost 6.08%
Equity Weight 29.52%
Equity Cost 6.79%
WACC 6.29%
Leverage 238.70%

11. Quality Control: SpareBank 1 Ostlandet passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
SpareBank 1 Ostlandet

A-Score: 7.7/10

Value: 6.4

Growth: 7.9

Quality: 5.5

Yield: 8.8

Momentum: 8.5

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
BKS Bank

A-Score: 7.0/10

Value: 7.3

Growth: 7.8

Quality: 5.6

Yield: 3.1

Momentum: 8.5

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
BTV

A-Score: 6.8/10

Value: 7.5

Growth: 7.2

Quality: 7.6

Yield: 0.6

Momentum: 8.0

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
Valiant Holding

A-Score: 6.6/10

Value: 5.9

Growth: 3.8

Quality: 4.9

Yield: 6.2

Momentum: 9.0

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
Spar Nord Bank

A-Score: 6.5/10

Value: 4.6

Growth: 7.3

Quality: 7.6

Yield: 4.4

Momentum: 9.5

Volatility: 5.3

1-Year Total Return ->

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Stock-Card
ProCredit Holding

A-Score: 6.2/10

Value: 9.8

Growth: 3.9

Quality: 6.5

Yield: 8.1

Momentum: 6.0

Volatility: 2.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

188.08$

Current Price

188.08$

Potential

-0.00%

Expected Cash-Flows