Earnings call transcript: NOBA posts strong Q2 2026 profit growth, shares slip

NOBA reported a 21% increase in adjusted core operating profit to SEK 1.5 billion for the second quarter of 2026. This growth was driven by loan growth, fee income, and improved credit quality. The Nordic lender also saw an 11% organic loan growth, exceeding its target of 10%. Despite the strong performance, NOBA's share price fell 1.46% to $88 in early trading, falling short of its $89.3 previous close.

While actual EPS and revenue figures were not disclosed, the company's operations demonstrated consistent strength. Private loans, credit cards, and secured lending all contributed to growth, with loan growth at 12% and revenue growth at 13%. Management noted that the company is converting loan growth into profit growth more rapidly, bolstered by stable margins and reduced credit losses.

The Nordic and German markets presented a stable competitive environment, aiding growth and profitability. Return on tangible common equity stood at 27%, or 29% on core capital employed, with management aiming for a 30% target through higher margins, lower costs, and more efficient capital usage. Despite the robust quarter, NOBA's stock remains below its 52-week high of $126 and trading above its fair value, with a P/E ratio of 10.68 and PEG ratio of 0.24.

Management outlined plans for cost reduction measures, including a potential share buyback program and an interim dividend, while also considering buybacks, dividends, and M&A opportunities as capital becomes available.