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2016-10-26

Nordax Group AB (publ): Nordax Group Interim Report January-September 2016

JANUARY-SEPTEMBER 2016

Numbers compared with January-September 2015

· Loan portfolio increased by 14% in constant currencies

· Net interest margin increased to 9.2% (8.7%)

· Total operating income increased to 882 MSEK (660). Adjusted total
operating income increased to 812 MSEK (689)

· Adjusted cost to income ratio (rolling 12 months) improved to 27.7%
(29.0%)

· Operating profit improved to 433 MSEK (170). Adjusted operating
profit increased by 27% to 360 MSEK (283)

· Net profit increased to 336 MSEK (132)

· Earnings per share were 3.03 SEK (1.19). Adjusted earnings per share
were 2.53 SEK (1.99)

3rd QUARTER 2016

Numbers compared with 3rd quarter 2015

· Loan portfolio increased by 14% in constant currencies

· Net interest margin decreased slightly to 9.1% (9.2%)

· Total operating income increased to 312 MSEK (226). Adjusted total
operating income improved to 279 MSEK (243)

· Adjusted cost to income ratio (rolling 12 months) improved to 27.7%
(29.0%)

· Operating profit improved to to 168 MSEK (83). Adjusted operating
profit increased by 34% to 138 MSEK (103)

· Net profit increased to 131 MSEK (64)

· Earnings per share were 1.18 SEK (0.58). Adjusted earnings per share
were 0.97 SEK (0.73)

CEO COMMENTS

"Net profit increased to 336 MSEK (132) and the return on our growing
equity was 24%"

The third quarter was Nordax's most profitable to date with positive
trends sustained in terms of solid growth, stable margins, increased
efficiency, improved capitalisation and low credit losses. New
lending and growth continued in all our markets in Northern Europe.
We are especially pleased that the improvements we have made in the
loan offering and processes in Finland have resulted in increased new
lending and a higher growth rate. Our capital position was further
strengthened as a result of the solid profitability and through a
change of method for calculating the capital requirements for
operational risk.

For the period January-September adjusted operating profit increased
by 27 per cent to 360 MSEK and our loan portfolio grew by 14 per cent
in constant currencies. Net profit increased to 336 MSEK (132) and
the return on our growing equity was 24%. Thanks to lower funding
costs, we were able to reduce our lending rates twice during the year
for customers in Sweden and once in Norway.

In our two largest markets, Norway and Sweden, which together account
for about 75 per cent of lending, we continued to perform well.
Lending excluding local currency effects grew by 17 per cent in
Norway and by 10 percent in Sweden.

Germany is our latest and smallest, but fastest growing market in
relative terms. With the support of additional data, we revalued the
provisioning level for past due loans in Germany during the quarter,
which reduced the credit loss level. We remain conservative with a
higher provisoning level for past due loans compared to our other
markets, where we have more historical data.

Demand for personal loans remains high, and we have a good offering
for our customers. We want to further improve the customer experience
and simplify for our customers by providing more digital
self-services and improved processes. The country organisation we
established in the second quarter for our customer facing units in
our Stockholm-office was an important step in this direction. Our
employees have quickly adapted, and the new organisation has been a
success. We expect in time that the efforts we are making to improve
our digital solutions and administrative processes will increase
customer satisfaction, produce more stimulating opportunities for our
employees and generate stable costs. Our ambition is to further
improve the adjusted cost to income ratio and take advantage of our
scalable operating model.

"Our ambition is to further improve the adjusted cost to income ratio"

A sustainable business model is essential for us and during the
quarter, our sustainability project progressed according to plan.
During the fourth quarter our ambition is to complete the work with
developing a sustainability strategy and to present the result in the
annual report for 2016.

Since 2010 we have organically grown our lending portfolio by just
over 15 per cent annually and profit has increased at an even faster
rate. Our focused business model with one product area, geographical
and funding diversification, and operations centralized in a single
office has been successful. Our long experience in the industry makes
us risk averse with a focus on a strong customer group and thorough
credit assessments to ensure low credit risk.

Our business is constantly developing thanks to all the skilled
employees in the company, and I am convinced that we have a bright
future as we become a leading niche bank in Northern Europe.

Morten Falch

CEO

Contact

For more information, please contact

Morten Falch, CEO, +46 8 690 15 07, morten.falch@nordax.se

Camilla Wirth, CFO, +46 8 690 15 07, camilla.wirth@nordax.se

Andreas Frid, Head of Investor Relations, +46 705 29 08 00,
andreas.frid@nordax.se

Johanna Clason, treasurer and debt investor relations, +46 8 690 15
07, johanna.clason@nordax.se

Conference call

Media, analysts and investors are welcome to take part in a conference
call on October 26 at 8.30am CET. CEO Morten Falch and CFO Camilla
Wirth will present the results. After the presentation there will be
a Q&A session.

Call-in numbers:

Sweden: +46 8 566 426 64

UK: +44 203 008 98 13

US: +1 855 753 22 36

Link to audiocast:

https://wonderland.videosync.fi/2016-10-26-nordax-q3-report

You can also follow the presentation on

https://www.nordaxgroup.com/en/investors/financial-reports/presentations/

This information is information that Nordax Group AB is obliged to
make public pursuant to the EU Market Abuse Regulation and the
Securities Markets Act. The information was submitted for
publication, through the agency of the contact person set out above,
at 07.30 CET on October 26, 2016.

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http://feed.ne.cision.com/client/waymaker1/WOLReleaseFile.aspx?id=371824...
http://mb.cision.com/Main/12531/2108411/580027.pdf

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