Welcome to the Resurs Q1 Report for Q1 2023. In the first part of the meeting, the participants will be in a listening mode. During the Q&A, participants may ask questions by pressing star five on your phone. Now over to the speakers. You have the floor. Thank you very much. Good morning, and welcome to the Resurs Holding Q1 Report. We're going to move over to the next slide. My name is Nils Carlsson, and I'm the CEO of Resurs Bank, together with our interim CFO, Stefan Noderén, we will present our development during Q1 2023. Moving on. Here we have a summary on page three, a summary of Q1. In the first quarter, we saw good growth. It was driven by consumer loans. The loan book was up by 10% to SEK 37.5 billion. NBI margin was stable, 9.1% compared to the previous quarter. We're not losing. Compared to previous year, earnings before credit losses were up by 15%. The credit loss level amounted to 3.0%. This comes as a result of the development we've seen in the economy overall during the autumn and the winter. Development has meant greater challenges for certain customer groups, this in turn has led to increased volumes in payment delay. Loan book growth and increased provisions in our macro model have also meant additional credit loss provisions in reserves. All in all, we're now reporting a drop after credit losses of 16% in our operating profit. Looking at our financial position and capital position, it is strong and stable. Total capital ratio amounted to 17%, which is a good bit over the regulatory requirements. All in all growth, both in the loan book and operating income, with a stable margin added to that. Moving on to slide number four. If we continue to sum up the first quarter, we see that NCR in March confirmed BBB flat rating with stable prospects for Resurs. NCR underlined that Resurs profitability, good liquidity, and long-standing experience in offering credit products are key factors in order to make this rating, and that's good news. In March, we issued subordinated Tier 2 bonds to the tune of SEK 300 million. We are pleased in the Nordic market, and we're pleased to note that this time around as well, there was great interest in Resurs in connection with this issue. During Q1, we note that credit losses come with an impact as a result of a loss in ability to pay at the beginning of the quarter and during the autumn and the winter. We've tightened our credit lending conditions to ensure a high level of quality in our new lending. In order to manage the current situation in the market and to make allowances for the increased cost of living of customers already during the autumn of 2022, we made some tightenings of our credit assessments all in line with the bank's conservative approach to credit risk. In spite of this, during the quarter, we have seen good growth in our loan book, which to us is proof to show that our offering to customer is strong and competitive. During the quarter, we launched a product called Resurs Pay by Loan. We do this in cooperation with Autolend, they are offering a quicker and easier way to arrange a car loan to consumers without any collateral. We launched something we call Resurs kollen, where you can analyze and get information on your energy consumption in your home and see what investments you could potentially make for a more sustainable living. During Q1, the results came out of the ranking in Sustainable Companies for 2022, we're very pleased to note that we are still the highest-ranked listed niche bank. During Q1, we've continued to develop the first cloud-based banking system in the Nordics. Our development plan continues, during the first quarter, we launched a few new components, online bank amongst them in some markets. This is our new internet bank. Our ambition with the internet bank is to increase customer satisfaction, of course, and make the customer journey a lot easier and smoother for our customers. Moving on to slide five to have a look at our loan book. If we look at growth per geographic market, we note that we have a significant continued growth in the Swedish market, 15% up compared to previous year, we have good growth in this quarter as well. In the Norwegian market, we see a down by 8% compared to previous year, it's mainly the development during Q1 which contributes to this lower number, mainly in consumer loans. In Denmark, over a certain period, we've seen negative growth compared to previous year, but here we see that we're continually taking new steps for improving with further automations of the customer journey as a result of the changed requirements for credit assessment introduced by the Danish Financial Supervisory Authority, and it is very rewarding to see that this is showing an impact during the latter part of the quarter. As we've mentioned earlier, we have a long-term belief in the Danish market, and we maintain our ambition to grow there. The Danish portfolio is the smallest of our portfolios, just a point for information. If we have a look at the Finnish market, we have a continued good pace of growth compared to last year. During the quarter, we also have growth, even if the pace is somewhat lower as a result of us being a little bit more selective in credit assessment, mainly in consumer loans. That was briefly a few words on loan book trends over time. Let's move on to slide six. We'll have a look at our business segments, starting with Payment Solutions. During the quarter, we've seen good growth in spite of the fact that the first quarter of this year has had quite a number of challenges for many Swedish retailers, both offline and online. Considering the global factors we see, such as inflation and higher interest rates, we do, however, see a continued clear demand for the services and products of Resurs Bank from both retailers and consumers during the first quarter. Lending, as you can see, to the public as per the 31st of March was up by 12%, amounted to SEK 12.9 billion. When we sum up the first quarter 2023 in payment solutions, we see, for example, that all 150 JYSK stores in Sweden are now up and alive with Resurs payment solutions. This is one sign, as I see it, to suggest that we are very competitive. During Q1, we continued to focus on a number of specific clusters and sectors of industry to focus on our margins amongst other things. We began a cooperation with MyDentist, and the dental segment in particular continues to see very good growth with us in. We have a collaboration with Frenda, the leading medical record system for dentists. Many of the dentists in Sweden use it, and that's another sign to show that our cluster strategy is paying off. Last year, we closed, as you remember, with excellent volume of new cards issued. The first quarter was no exception. The growth in credit cards remains good, and issuing of new cards through our own channels is increasing to an ever greater share of total volume. In B2B as a cluster, we see that the cooperation with Komplett is continuing, and we see very positive development in that cooperation on factoring products. That was Payment Solutions. Briefly moving on then to consumer loans. This is our second business segment. Here lending to the public as per the end of March was SEK 24.5 billion and up by 8% in Swedish krona. Demand for consumer loans has remained good and stable during the first quarter. The strategy we have remains in place. We prioritize increased profitability over volume growth. During the quarter, we've made several price adjustments to secure future profitability. Interest rates adjustments have also been made, as you will have seen, for existing customers in Sweden, Norway, and Denmark to compensate for higher funding costs. If we look at Sweden then, the demand for seamless services to create smooth customer journeys is up. It's growing rapidly over the past few years. Simplifications of the way the customer relate and deal with us and the customer journey in the credit process are factors we continue to focus greatly on in the Swedish market. If we look at Norway, Resurs continues to develop its offering in what we call Balanselån, loans secured with collateral in residential property. We want to focus on building up a strong cluster network, or distribution network rather of both external partners and internal channels, and we believe this will be an attractive offering. Finland, during the first quarter, we've seen a somewhat tighter, fiercer competition, so slightly lower demand than previously as a result. In spite of this, we remain at the situation where growth is looking very good in Finland. Denmark. In Denmark, for several quarters now, we've had an intensified focus on further developing the application process in consumer loans and the credit assessment. We want to create a better and more efficient customer journey. This work has continued during the first quarter, of course. Now I'm going to hand the floor over to Stefan so that he will tell us a little bit more about the numbers. Thank you, Nils. We will continue with page nine. As Nils has already said, we have a loan book that is up 10% compared to last year, now amounting to SEK 37.5 billion. In constant currencies growth was 8%. Since end of last year, we have slowed down the pace of growth through the rigorous adjustments we have made to our credit models and to ensure that we have good quality in our new lending in this changed financial climate. We continue to deliver growth compared to last quarter as well. Loan book was up 1% in reported and constant currencies alike. The growth compared to last year is from both our segments. We continue with the next page. This page shows us the operating income that was up because of the growth in loan book amounting to SEK 8.5, Income growth was up 11% compared to Q1 2022. Our NBI margin is stable at 9.1% compared to previous year. Has been mentioned during previous quarters, we have some timing effects due to increased market rates that are being brought on to customers and partners alike, The margin is kept stable, We see a sequential strengthening of margins during the quarter. If we continue with page 11 and our credit losses. This quarter, they are higher compared to Q1 last year, That goes for absolute numbers and share of the loan book alike, amounting to 3.0% compared to 2.1% last year. Compared to Q4, we see an increase with 2.6%. The development is driven partly by the financial situation for certain customer segments. This has led to a deterioration in disposable income, which has led to higher volumes in payment delays that leads to an increase in credit loss provisions. The growth in the loan book and provisions to our macro model is also contributing to this increase in credit loss provision. Our credit losses, here we see a similar development as for margins, where credit loss ratio is improving for the latter part of the quarter. As I've already mentioned, this quarter we have continued to review our credit models against the backdrop of the financial situation we see in our markets in order to ensure that we have high quality in our new lending. We continue with page 12. We will start with the segments and first Payment Solutions. Payment Solutions loan book is up compared to last year with 12%, 11% in constant currencies. Compared to last quarter, loan book is down with 1%. Growth in this loan book compared to last year is due to retail finance and B2B, whereas the loan book for credit cards remains stable. Compared to last year, we have a strong growth in income, thanks to the growth in loan book, and the margin is kept stable. Compared to last quarter, we see a marginal decline of earnings, mainly due to the lower margin. Credit losses are up compared to last year due to higher volumes in payment delays, leading to higher credit loss provisions. Compared to last quarter, we see a downturn in that is partly due to the reduction in loan book, and this is a marginal downturn. We continue with consumer loans. Consumer loans loan book was up 8% at 7% in constant currencies. Sweden and Finland are driving growth both in percentage terms and absolute terms. Compared to previous quarter, growth was a total of 2%. Income is up at 10% compared to last year, and the NBI margin is 0.1 percentage points higher. Compared to the previous quarter, income is up with 1%, whereas the margin is down 0.1 percentage points. Looking at credit losses, they are up compared to Q1 previous year and the previous quarter this year, which has to do with the negative financial development, which has led to an increase in payment delays and also an increase in credit loss provisions. The growth in the loan book and the provisions in our macro model are also contributing to the higher credit loss provision. Looking at the expenses, we see that expenses are up 6% compared to last year, which is strong compared to the revenue growth, being 11%, which means that the C/I ratio is improved with 1.9 percentage points compared to last year and 0.6 percentage points compared to the previous quarter. As has already been said, we have a very high ambition level when it comes to efficiencies and the objective to reach a C/I ratio of 35% in two to four years. The C/I ratio of the quarter is showing us that we're headed in the right direction. Looking at our profit, we see that before credit losses, earnings are up 15% versus last year, thanks to strong increase in income and the improvement of the C/I ratio. Minus credit losses, we deliver an operating profit that is down 16% compared to Q1 last year, amounting to SEK 217 million. Looking at our capital position. Our capital position remains to be strong with a total capital ratio of 17% and a CET1 ratio of 14.7%, which is well above regulatory requirements and also above the objectives set by the board. We expect, as we've already said, that these capital requirements will increase in the future. What is driving the increase in our capital ratio this quarter, of course, is the issue of the Tier 2 bond that has already been mentioned, where we had the issue in March. We also have changes in how to calculate capital requirements and the operational risk and also of course, our ability to deliver in these challenging times. Moving on to page 17 and funding. We have a very stable funding. For a long time now we've been working with a diversified funding, and this is a strategy that remains firm. This quarter, we have seen that we have stability in our deposits and that although we have seen some turmoil during the quarter, it should be mentioned that more than 95% of our deposit funding is covered by the state guarantee, deposit guarantee scheme. We have very strong liquidity. For example, the LCR ratio is 260%. That being said, I'm going to hand back to Nils. Thank you very much, Stefan, for that summary. If we look at the period ahead, our focus remains to deliver profitable growth where profitability is prioritized over growth. We will continue to focus, of course, on new partnerships in our business. We will continue to maximize the potential of all our existing corporations. The implementation of our new cloud-based core banking system. There we will roll out several components to customer during the next quarter. We look forward to the next period in that sense, and we also experience that the general demand for credits was good during the quarter. As has been mentioned, we have noted a certain slowdown in some sectors. In the future, this may involve a further impact depending on the macro situation and the way inflation develops. A drop in sales in retail is a negative factor, of course, whilst the increased need for flexible financing solutions and credits, on the other hand, could contribute to an increase in demand. The rising inflation and interest rates in the market also mean that, moving forward, we will be working with price adjustments both for deposits and lending, and we will gradually transfer our increased funding costs to our customers. As we've stated on previous occasions, there may be various timing effects between the different quarters. To conclude, and this is something which is particularly important to underline, where we have seen a somewhat turbulent quarter, is the fact that we have a strong, stable financial position and we will have our annual general meeting of shareholders today with a resolution on dividend payment. With those words, Stefan and I would like to say thank you and we're now going to open up for questions. If you would like to ask a questions, press star 5 on your phone to enter the waiting list. If you would like to withdraw, press star five again to withdraw. The question that we will start with is from Jacob Hesslevik from SEB. Good morning. My first question has to do with Payment Solutions. It seems to be down with well around 30% compared to previous quarter. Why? Hello, Jacob. This is Stefan Noderén. The main reason is that we see seasonal fluctuations, and we've seen that during Q1 basically every year for Payment Solutions. This is driven by the type of sales that we have towards the end of Q4, that has an effect that is being carried over to Q1 to a great extent. Thank you. If we continue with the Payment Solutions growth that are 12% on an annual basis and 1% down looking at the quarters, is that also a seasonal effect or is this downturn explained by something else? I think that it's something else. Looking at Payment Solutions as such, looking at Q1, we see that some of the customers have been impacted by the turmoil that we have seen in the market where certain consumers, for example, have less of a disposable income. We also see that some of our customers, well, things are slowing down a bit compared to what we've seen from these customers in previous quarters. It's more of a macro impact, I would say. Okay. Continuing with consumer loans, credit losses were up. Could you quantify the 70 basis points that we see and how it's driven? Well, actual credit losses is a very small part of this. It's mainly credit loss provisions that we see. The main component is an increase in volumes in delays in payments. We also have the component that is being made up of the macro model. In Q1, we also see a trend. Well, we see a difference rather between the beginning of the quarter and the end of the quarter where we see an improvement towards the end of the quarter. Thank you. That is good to hear. If we continue with the consumer loans and looking at the interest income YoY, it's 29%, and interest expense is 168%, and I assume that that is due to a lot of the funding being via deposit. If you want to grow interest income, you will have more credit losses. Would there be any way through which you could turn this trend around? Also thinking about what will come from the central bank, the Riksbank. Well, I think that we should rather look at what we do with the margins. We shouldn't be looking at the underlying components and where and how they grow. We have NIM that is up compared to previous years. Looking at the interest rate situation in the market today, we have the ambition to strengthen margins compared to what we've seen historically. We see a sequential improvement in NIM and margins alike during the quarter. How long will this take to transfer these funding costs to consumers, one month to three months? Well, we also have regulatory requirements, so that depends on the market. We decided to make an adjustment, then it will take some time before we're allowed to do so. I agree with what Nils has just said. As long as we have that trend going upwards in the interest rate market, we will have this effect. There will be a lag because for every step where we see a change in interest rates, we'll see this effect. Over a few cycles, we feel safe and secure in knowing that we will be able to solve this task. Okay, thank you. A last final question. Looking at deposits, they're not up that much in this quarter, I would like to ask about that and the reasons. Is it because you do not want more deposits because there is no opportunity to grow, or is it that you're not competitive enough compared to other niche banks? Well, I think that, it's a combination of different effects. The main one being that, we have a very strong liquidity reserve. Looking at the market the way it looks now with the interest rate market, we have no ambition to increase that reserve, but we want to match the need, so to say, looking at, our lending. Thank you. Next question is from Patrik Brattelius from ABG. You have the floor. Thank you. A few follow-up questions on the topic you just touched upon, starting with the credit loss level. It's up in consumer loans, this was mentioned, but it's reducing in Payment Solutions. If we look sequentially, it's mainly in consumer loans where the loan book is growing. What's your thinking on this strategy in terms of priorities? Thank you. Well, this is more or less our reasoning. We want to be selective in new lending. This is precisely why we've tightened up our assessment to ensure that given the world around us, that we have a high credit quality in new lending. For that reason, I think I sort of lost my train of thought. Let's look at this as Nils. If you look at consumer loans, you can see amongst other things in the different markets that movements vary somewhat, both in growth and in credit loss provisions. The idea is just as Stefan touched upon, that we want to be very selective in the current market situation on credit loss provisions and customers we bring in in new lending. Our ambition remains to have growth, of course, but as I mentioned in my part of the presentation, growth is not the primary feature, it's profitability rather, and our ability, given the current situation, to transfer, for example, interest rate adjustments and the cost increases we see onto our customers. It takes some time to do this, but it is our stated ambition to do so. I don't know if that answers your question. Well, partly at least. From an outsider's perspective, perhaps you might think that if credit losses are down in Payment Solutions but are up in consumer loans a lot more, perhaps it would be worthwhile to prioritize growth in Payment Solutions, simply put. Is it in fact the fact that the bottom line profitability is so much better in consumer loans in your assessment? What are the differences? We are satisfied with the profitability, generally speaking, in both of our segments. I think you also need to bear in mind that when it comes to consumer loans, we're operating that business more independently and based on our own abilities, whereas Payment Solutions as a business to a great extent is operated together with partners. The core business development of the partners will have an impact. I understand. I see. A follow-up question also on delayed payments, which you mention. We touched upon this at a previous question. Could you tell us a little bit more about how it's developed during the quarter? Has it gradually changed as interest rates go up in Sweden or in the Nordics generally? Could you say anything more about this? We have seen a gradual change during the course of the winter really. We mentioned this in the Q4 report as well, and it has continued during the first part of this year. We see a marked improvement in the latter part of this quarter. Could that also lead to a sequential improvement on credit loss levels when you look and gaze into the next quarter? Well, we're not giving any future guidance. We can only note what we've seen in Q1. There we've seen what I've just outlined. Okay. That sounds like positive signals nevertheless going into this quarter. I have a few detailed questions on some numbers. The net fees and commission levels are up quite a lot in the first quarter compared to Q4. What's driving the development you've seen? If we look at the cost for the fees and commissions and our retail business, this is quite linked to our B2B business, amongst other things, where we work with Komplett in collaboration. I think that's what you see shining through to some extent. Is this a once off effect? It was SEK 14 million in Q4, and it's at SEK 24 million now. I'm just trying to understand what the underlying run rate is to gain an understanding for where this is heading looking into the future. I don't think you should extrapolate that tangentially because on the one hand, Nils replied, but in addition, we also have somewhat different agreements in different partnerships. You might expect some fluctuations between quarters depending on the mix effect and depending on sales in our Payment Solutions and how it's driven. Thank you. I see. My final question is one where if we can have a look at the report on the total results, you have a difference in recalculation of activities abroad to the tune of - SEK 60 million. What does this consist of? I don't have that report in front of me right now, so I think I'll have to owe you an answer on that one, Patrik, I'm afraid. Okay. Well, we can get back to and follow up on that after the call this afternoon. Okay. Thank you. The next question is from Emil Jonsson, DNB. Please go ahead. Hi, and thank you for the presentation. I have a few brief question having to do with credit losses. You do mention in your reporting that the credit loss ratio is up due to the loan portfolio having grown. I can understand that in absolute numbers that the credit losses go up with an increase of the portfolio, but the ratio, how come that is increasing? This is a bit of a technical explanation, but if we have lending of day one, we have to have provisions as of day one. Those provisions that reserve, we have to look at in its entirety. For example, if we have a provision of, let's say 1% in Stage 1, that makes it easier as an example, then we'll have that effect of 1% during a quarter, and then it will be realized as 4% in COR. It's purely technical. During the quarter, when did the credit loss ratio peak? Was it beginning, middle, end of the quarter? We can not go into such detail as to different parts of the quarter. What we've seen is that we have a higher level beginning of the quarter and a lower level end of the quarter. Okay. Could you say something about the magnitude, the order of magnitude, to what extent it was lower towards the end of the quarter compared to the peak during the quarter? No, I'm afraid we cannot give you that level of detail. As Stefan has already said, it's higher beginning and somewhat lower towards the end of the quarter, and that is what we can tell you right now. Okay. The last question. Investors now see where things are headed, looking at the business cycle. Can you say something to investors so that they feel safe and secure in that credit losses will not increase significantly during the rest of the year? Do you want to answer, Stefan, or should I? Says Nils. I guess we can help out, says Stefan. We're not giving any forward guidance. We don't. Of course, the type of business that we have has a focus on consumer credit, and we want to be a responsible actor, but we also want to make credit available for all these people. Certain consumer segments have less of a margin in their household finances. Most of that pressure on households perhaps is behind us, looking at inflation, interest rates. The developments ahead when it comes to unemployment will impact. Nils, what can be said as well, looking at the Resurs Bank, being an analyst, well, perhaps you should look at a longer cycle and not just a quarter. Looking back at 2021, 2022, we've had a total credit loss ratio of 1.2%. Same thing if you look at 10 or 15 years back. I think that, well, you shouldn't make too many assumptions based on just one quarter, but you should look at a longer period of time. We're very conservative. Of course, if consumers are affected by the market and there is a deterioration in purchasing power, that will have an impact. We can also see other positive impacts, as we've said today. I think that looking at Resurs Bank, you should do that from a longer perspective. Then you'll see that we're very conservative when it comes to credit loss ratios without giving any guidance for the future. Okay. Thank you. Those were my questions. Thank you. There are no further questions at this time. I'm going to give the floor back to the speakers for any closing remarks. Thank you very much. Thank you for everyone who joined this press conference and listened, and thank you to all those who have asked questions. I hope that you got as many questions as we were able to give you and have a continued rest of the day. Thank you for asking.