Financial Information

Key Ratios

A comment from our CEO

As I write this, I have been CEO of Collector for about 50 days. Formally, I began on 1 August. Nonetheless, during the summer I worked quite a lot to familiarize myself with the company, to meet all of my colleagues, and to understand the product flora, revenues and expenses.

I have followed Collector from the outside for a number of years and actually bought my first shares in Collector in the early spring of 2018. At that time, I saw Collector as a dynamic, and efficient niche bank operated with an entrepreneurial spirit. To me, Collector was a bank driven forward by developing innovative and efficient banking services and characterized by its strong business acumen. Now that I have better insight into Collector, I am even more positive.

Collector’s strength is our short, straightforward decision making paths, which enable us to quickly reconnect with our customers. Combined with a high skill level, considerable focus on customer satisfaction and an ambition and willingness to make customer transactions, this makes Collector a unique bank. We have a broad product offering, both for private individuals and companies, broader than many may think. We are growing and will continue to do so. I see potential in all areas of operations and existing geographies. Of course we will also continue to develop smart and efficient banking services.

Collector had a sluggish start to 2018 with declining revenue growth and high expenses. Revenue rose in the third quarter compared with the preceding quarter. The C/I ratio improved from 0.45 to 0.43 over the quarter. This is a positive trend but some way off our target.

As a result, we will further intensify our efforts to reduce expenses. At the same time, we need to continue increasing revenue growth.

Corporate segment

Our Corporate segment is performing strongly, particularly in Sweden and Norway. We see continued strong demand for factoring and company credits throughout the Nordic region. The Corporate segment accounts for about 40 percent of total revenue and 49 percent of the total credit portfolio.

Real estate credits to housing developers are limited to a few major players with projects in which at least 70 percent of the units have been sold, with binding transfer agreements before the loans are disbursed. The exposure to housing developers corresponds to about 4 percent of total lending. Other real estate credits are well differentiated in terms of the selection of properties and geographic location within the Nordic region. Generally, borrowers are larger property companies and funds where Collector bridges transactions pending long-term financing.

Retail market

The transformation to a lower risk level in the portfolio continues and, at the same time, we are working to launch new personal loan products attracting a more solvent target group.

Across the period, we see increased distribution of our products and services through proprietary channels, which is in line with our strategy. The increase is more than 50 percent compared with the preceding quarter. We can also note that customer satisfaction, which we measure regularly, is increasing and, during the period, we are happy to have noted an all-time high in the Customer Satisfaction Index for personal loans, at NPS 60. Work on launching mortgage loans continued during the period. We have already disbursed a number of mortgages and additional volumes have been approved and will be disbursed shortly. The Retail segment accounts for about 60 percent of total revenue and 51 percent of the total credit portfolio.

In payment solutions, we have signed several contracts during the period with strategic customers, assuring continued favourable growth. Long lead times for implementation with customers entail a considerable delay between a contract being signed and revenue flowing in.

Colligent

During the third quarter, Colligent experienced a high case inflow, with the third quarter of 2018 being its best quarter to date. During the autumn, we will intensify our work to roll out Colligent’s services in Finland and Norway.

Collector Ventures

Collector has invested a total of SEK 175 million in 24 companies since the outset in 2016. During the third quarter, additional investments were made in a couple of the companies that have reached the next phase in the growth curve. To date, the portfolio companies have generally delivered beyond expectations.

Martin Nossman