Fellow Bank - Earnings below expectations
Fellow Bank’s top line figures were better than expected, while higher than expected opex and expected and realized credit losses saw earnings fall below our expectations. Positive profit levels on a monthly basis are expected to be reached during H1/2023.
- Total income during H2/22 amounted to EUR 7.9m (Evli EUR 7.1m). Net interest income amounted to EUR 6.6m (Evli EUR 6.8m) and net fee and commission income to EUR 1.5m (Evli EUR 0.3m).
- In H2 lending volumes exceeded those of H1 by 43% and the target increase of 46% in the loan portfolio for personal customers was reached.
- The loan portfolio at the end H2 amounted to EUR 163.8m and the deposit amounted to EUR 246.8m.
- The pre-tax profit during H2 amounted to EUR -2.3m (Evli EUR -0.7m). The difference compared with our estimates was mainly due to a larger than estimated expected and realized credit losses, with total OPEX also above our estimates.
- Earnings per share amounted to EUR -0.03 compared with our estimate of EUR -0.01.
- CET1 and the CET1 ratio amounted to EUR 17.7m and 12.6% and total capital ratio to 16.8%
- The cost / income ratio amounted to 113%.
- Outlook for 2023: The bank’s revenues are estimated to grow from 2022 and a positive profit level on a monthly basis is estimated to be reached during H1/2023. Capital adequacy target set at 16%.
- Dividend proposal: The BoD proposes that no dividends be paid (Evli EUR 0.00)