Weaker results for the banks in 2020

Norwegian banks’ profit as a share of average total assets was 0.64 per cent in 2020. Total comprehensive income was NOK 38.9 billion, while other comprehensive income was NOK -48 million, according to updated figures from Banks and mortgage companies.

Decreased net interest income

The banks’ net interest income amounted to NOK 86.5 billion in 2020. Total interest income and total interest expenses was NOK 25.3 billion and NOK 21.5 billion less compared to 2019, respectively. The combination of lower interest income and lower interest expenses resulted in a NOK 3.8 billion lower net interest income compared to 2019. The last time the net interest income at the end of the fourth quarter was lower than the previous year was in 2009. Net interest income as a share of average total assets was 1.42 per cent in 2020. This share is 0.23 percentage points lower than in 2019.

Increased credit losses on loans yet low confirmed losses

In 2020, the banks’ credit losses on loans amounted to NOK 26.3 billion. This is NOK 16.6 billion more than in 2019. Only NOK 5.3 billion out of the total credit losses on loans in 2020 was confirmed losses, this is NOK 0.9 billion more than in 2019. As a share of total assets, the banks’ credit loss on loans was 0.43 per cent, which is 0.25 percentage points higher than in 2019.

Lower share of claims on customers

At the end of 2020, loans to and claims on customers were 55.6 per cent of the banks’ total assets. Compared to 2019, this share has decreased by 3.0 percentage points. Loans to and claims on credit institutions as a share of total assets has increased by 0.5 percentage points from the previous year to 16.3 per cent.

Deposits are the largest source of funding, with a share of 68.8 per cent of total assets by the end of 2020. Compared to 2019, the deposits’ share of total assets is close to unchanged. Interest-bearing securities amounted to 12.5 per cent of total assets. Compared to 2019, the securities’ share of total assets decreased by 1.6 percentage points.

Fluctuations in the exchange rates for the Norwegian kroner against other currencies affect the size of the Norwegian banks’ balance sheet figures. At the end of 2020, 58.5 per cent of the banks’ total interest-bearing securities