Hordaland på Børs August 2018 · Financial highlights 8 Q2 –2018 Q2 –2017 12 month growth in % Net interest income (NOK million) 327.5 310.6 5.4 Net fee and commission (NOK

Hordaland på BørsAugust 2018

Sbanken group

Sbanken at a glance

2

Account

customers

445 0001

Attractive customer base

Primary

customers

165 000²

1 in every 13th

Norwegian3

∼3% of the total population3

Fair deal and focus on user friendliness

“Born digital”All products for everyday bankingUnrivalled reputation

1 in every 5 Norwegians would consider using Sbanken4

Automated application processes

Automatedloan

process

Processtime in

seconds

Efficient

application

process

Capital

Provided

quicly and

direktly

Fully automated

• Credit card

• Costumer loan

Semi automated

• Home loans

• Car loans

Developments in Q2

• Continued strong loan growth at 6.4 per cent last 6 months

• Net income growth of 35 per cent last 12 months (LTM)

• First Norwegian bank to launch Apple Pay

• New version of savings robot adviser launched

• The most satisfied and loyal customers in the banking industry in Norway for 17 consecutive years - also with the Sbanken brand

• Growth initiatives advancing

3

Profitable growth

4

- 26 consecutive quarters of lending growth

5355 57 58 60 61

6368

71 72 72 7477

200

300

400

500

600

700

800

900

1 000

1 100

40

45

50

55

60

65

70

75

80

85

2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18

Earn

ings

bef

ore

tax

(LT

M)

-ad

just

ed f

or

Vis

a ga

in Q

2 2

01

6

Tota

l lo

ans

to c

ust

om

ers

(bN

OK

)

Total loans to customers (bNOK) Earnings before tax (LTM) - adjusted for Visa gain Q2 2016

Savings

5

9,1 9,6

11,5 11,111,9

1 187 1 123

2 2582 479

2 272

2Q17 3Q17 4Q17 1Q18 2Q18

FUM (bNOK) NCCF (LTM mNOK)

29.7%

True mobile banking- Built to be relevant

• Built with close customer involvement through the development• Utilising behavioural economics through push notifications and

relevant everyday advice• Designed to present accounts and transactions from various

banks post-PSD2• The whole bank available on mobile

1

2

3

4

6

Increasing IT development capability

7

• Substantial increase in in-house development capacity

• Established additional capacity though offshore development unit in Lisbon, Portugal

• Lowered average hourly cost

• Employed a substantial pool of technology students as part time developers to boost capacity as well as future recruitment

• Gained necessary flexibility to seize future opportunities

Financial highlights

8

Q2 – 2018 Q2 – 201712 month

growth in %

Net interest income (NOK million) 327.5 310.6 5.4

Net fee and commission (NOK million) 47.6 39.5 20.4

Profit before loan losses (NOK million) 268.1 214.4 25.1

Net profit (NOK million) 209.2 154.7 35.2

ROE (per cent) 15.3 12.4

Cost-to-income (per cent) 38.6 40.2

Lending growth (per cent) 8.1 18.1

NIM (per cent) 1.47 1.57

Loan-loss-ratio (per cent) 0.07 0.06

CET1* (per cent) 14.8 14.4*Including 90 per cent retained earnings in Q2 2018 and 70 per cent in Q2 2017.

Revenues

9

• Net interest margin expected to increase in Q3 2018 • Continued positive development in income from mutual funds

Net interest income Net fee and commission income

311 331 345 348 327

1 219 1 250 1 286 1 336 1 352

1,57 1,63 1,65 1,66

1,47

2Q17 3Q17 4Q17 1Q18 2Q18

Net interest income Net interest income (LTM)

Interest margin (% right axis)

4054

39 43 48

8

47

177 178 174 176184

2Q17 3Q17 4Q17 1Q18 2Q18

One-off related to fee and commission income

Net fee and commission income Net fee and commission income (LTM)

Cost and cost-to-income

10

597

567 564 571 575 582

615 619643

40,8 %

38,0 %36,3 % 36,1 %

41,8 % 40,3 %41,5 % 40,7 %

40,2 %

45,9 %

42,0 %40,6 % 40,7 %

40,7 %39,2 % 39,4 % 38,8 % 38,6 %

2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18

NO

K m

illio

n

Operating expenses (LTM) C/I (LTM) C/I adjusted for one-offs (LTM)

• Initiatives in savings, insurance and SME are main drivers for cost increase in 2018

• Cost-to-income ratio target of < 35 per cent

• Expected annual cost level of ~NOK 650 million for 2018

Asset quality

11

• Loss level expected to be below 0.1 per cent in 2018 • Trend in LTV for new loans from Q4 2017 is mainly due to the new low LTV loan product

• 44 per cent new customers in the new loan product in the quarter

Net loan losses and loss ratio1 Mortgage lending and LTV

1) Loss rate adjusted for portfolio sales in 2017

5866

52 51 46

0,11% 0,11%

-0,01%

0,08% 0,07%

2Q17 3Q17 4Q17 1Q18 2Q18

Net loan losses (adj. LTM) Loss rate (adj.)

56 57 5964

67 68 68 6973

62% 62% 63% 62% 62% 64% 66%62%

54%

53% 53% 54% 52% 52% 55% 56% 56% 54%

2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18

Mortgage lending LTV (new customers)

LTV (existing customers)

Funding and capital

12

Funding Capital

6006

48 47 47 48 51

23 23 25 26

30

4 4 4 4

4

1 10 0

0

66% 67% 66% 65% 64%

2Q17 3Q17 4Q17 1Q18 2Q18

Debt securities MTN

Covered Bonds Customer deposits

Deposit-to-loan ratio (right axis)

5 285

500

650 6 435

14,8 %

1,4 %

1,8 % 18,0 %

14,0 %

13,2 %

CET1 Tier 1 Tier 2 Total Capital

CET1 target CET1 minimum

Targets 2017 - 2019

2Q 2018 Targets

Return Return on equity 15.3 % 14.0 %

Dividend Pay-out-ratio n.A Up to 30 %

Capital CET1 ratio 14.8 %* 14.0 %

Growth Annual loan growth 8.1 % > 10 %

Operational efficiency Cost-to-income ratio 38.6 % < 35 %

13* Including 90 per cent retained earnings Note: Targets are subject to the current capital requirements. Any future regulatory changes could imply a change to the target

Q&A

14

Important information

15

Sbanken ASA and its wholly-owned covered bond subsidiary, Sbanken Boligkreditt AS, constitute the Sbanken group.

This presentation contains certain forward-looking statements relating to the business, financial performance and results of the group. No representation is made that any ofthese forward-looking statements or forecasts will come to pass or that any forecast result will be achieved and any reader is cautioned not to place any undue reliance on anyforward-looking statement. The information obtained from third parties has been accurately reproduced and, as far as the company is aware and able to ascertain from theinformation published by that third party, no facts have been omitted that would render the reproduced information to be inaccurate or misleading.