HØLAND OG SETSKOG SPAREBANK (HSPG) investor relations material

Executive summary

• Reported a net loss after tax of NOK -15.0 million for H1 2026, compared to a profit of NOK 30.5 million in H1 2025, mainly due to high loan losses and provisions related to the weak new housing market and specific exposures in property development.

• Gross loans including EBK increased by 5.42% year-over-year to NOK 8.6 billion, while customer deposits decreased by 3.37% to NOK 4.98 billion.

• The bank remains well-capitalized with a consolidated CET1 ratio of 16.95% and total capital adequacy of 24.73%.

Financial highlights

• Net interest income for H1 2026 was NOK 61.6 million, stable year-over-year.

• Operating expenses rose to NOK 60.14 million (from NOK 50.24 million), driven by external resources for managing distressed exposures.

• Loan losses and provisions totaled NOK 60.7 million (up from NOK 13.1 million), reflecting increased individual impairments and a bankruptcy in the property development segment.

• Cost/income ratio (adjusted) increased to 71.52% from 60.41% year-over-year.

Outlook and guidance

• Despite the H1 loss, a positive full-year result is expected, but no dividend will be paid.

• The bank anticipates further reduction in distressed exposures during 2026 and expects increased housing construction in the medium term due to strong net migration and a tight rental market.