trending Market Intelligence /marketintelligence/en/news-insights/trending/CXsaIuyVI3gaSx1CLD9zFQ2 content
Log in to other products

Login to Market Intelligence Platform

 /


Looking for more?

Contact Us

Request a Demo

You're one step closer to unlocking our suite of comprehensive and robust tools.

Fill out the form so we can connect you to the right person.

If your company has a current subscription with S&P Global Market Intelligence, you can register as a new user for access to the platform(s) covered by your license at Market Intelligence platform or S&P Capital IQ.

  • First Name*
  • Last Name*
  • Business Email *
  • Phone *
  • Company Name *
  • City *
  • We generated a verification code for you

  • Enter verification Code here*

* Required

Thank you for your interest in S&P Global Market Intelligence! We noticed you've identified yourself as a student. Through existing partnerships with academic institutions around the globe, it's likely you already have access to our resources. Please contact your professors, library, or administrative staff to receive your student login.

At this time we are unable to offer free trials or product demonstrations directly to students. If you discover that our solutions are not available to you, we encourage you to advocate at your university for a best-in-class learning experience that will help you long after you've completed your degree. We apologize for any inconvenience this may cause.

In This List

Nordea unveils new strategy to boost performance following Q3 loss

Street Talk - Ep. 64: Coronavirus jumpstarts digital adoption

Street Talk Podcast

Street Talk - Ep. 63: Deal talks continue amid bank M&A freeze, setting up for strong Q4

Street Talk Podcast

Street Talk - Ep. 62: 'Brutal' outlook for oil demand offers banks in oil patch no relief

Amid Q1 APAC Fintech Funding Slump, Payment Companies Drove Investments


Nordea unveils new strategy to boost performance following Q3 loss

Nordea Bank Abp's new CEO, Frank Vang-Jensen, unveiled a new strategy along with third-quarter earnings that will see it cut costs and take measures to drive performance.

The bank reported a loss of €332 million for the third quarter, compared to a profit of €724 million a year previously.

"Our financial performance has not been where it should be for some time," Vang-Jensen said during the Oct. 24 call. "The new plan will significantly improve our operating performance."

Vang-Jensen took over as CEO from Casper von Koskull in September.

Targets

The new strategy, which Nordea will elaborate on at its Oct. 25 capital markets day, aims to bring a return on equity to above 10% in 2022 and to reach a cost-to-income ratio of 50% in 2020. The bank is also hoping to bring its cost base below €4.7 billion in 2020, with ongoing cost reductions after that.

The bank's cost-to-income ratio stood at 58% at the end of the third quarter.

Nordea will look to boost performance through a mixture of organic growth and M&A, Vang-Jensen said. It will consider bolt-on acquisitions similar to Gjensidige Bank ASA, a Norwegian lender it bought in the first half of 2019.

Any excess capital will be distributed back to shareholders, with share buybacks as a tool for this, he added.

The new strategy will help the bank to regain "lost ground" in terms of market share, Vang-Jensen said.

Job cuts

The bank expects to cut jobs as part of cost-cutting efforts in its new strategy. As a result, it has included a restructuring provision of €204 million for the third quarter to cover redundancies and other expenses.

In total, the bank racked up one-off charges totaling €1.3 billion during the quarter. This includes IT intangibles totaling €735 million and losses relating to the sale of shares in Luminor Group AB. The bank has also made loan loss provisions of €229 million, following discussions with the European Central Bank, reflecting the subdued outlook for certain sectors of the economy.

The bank's loan losses during the quarter totaled €49 million, which the bank said was mainly due to the offshore sector.

The quarter has been "special" due to the unusual number of one-off expenses, Vang-Jensen said.