Komplett Bank Annual Report 2020

Board of Directors’ Report Overview Komplett Bank ASA (the “Bank”) started operations in March 2014 when the company received its banking licence from the Norwegian authorities. Komplett Bank offers attractive consumer financing products to creditworthy customers. The Bank’s product suite consists of consumer loans, credit cards and point-of-sale (POS) finance products, as well as deposit prod- ucts in the Norwegian, Swedish and German markets. The Bank’s main products are consumer loans, including annuity loans, as well as flexible loans which give the customer more flexibility in drawing on the credit line. In April 2020, Komplett Bank also launched a refinancing product in Norway. In addition, the Banks offers the “Komplett Bank Mastercard,” a credit card tailored especially for online shopping. The Bank’s deposit products are characterised by attractive interest rates in Norway, Sweden and Germany. As a member of the Norwegian Banks’ Guarantee Fund, customer deposits are guaranteed up to NOK 2 million per customer. Foreign deposits are guaranteed up to EUR 100,000. In 2020, Kistefos AS purchased Canica Invest AS’ ownership stake of 19.4% in Komplett Bank. At the end of 2020, Kistefos has an ownership stake of 24%, and is Komplett Bank’s largest shareholder. The Bank’s registered offices are at Vollsveien 2A in Lysaker outside Oslo, Norway, and in November 2017, the Bank was listed on the main list of the Oslo Stock Exchange with the ticker symbol “KOMP.” Strategy and long-term ambitions Komplett Bank is pursuing a growth strategy based on geograph- ical and product-wise diversification and expansion. The strategy is founded on a digital, scalable and efficient operating model with low costs and strong risk control. The Bank operates on a cross-border basis from its offices in Lysaker, outside of Oslo. The Norwegian banking license allows the Bank to market its products throughout the entire European Economic Area (EEA). The Bank launched consumer loans in Norway in Q1 2014, in Finland in Q1 2017 and in Sweden in Q1 2018. In May 2019, the Bank launched a new annuity loan product tailored to meet new consumer lending regulations in Norway and in April 2020 the Bank’s refinancing product was launched. Credit card operations started in Norway in Q4 2015, in Sweden in Q1 2019 and in Finland in Q2 2019. Point-of-sale (POS) financing products were launched in Norway and Sweden in Q3 2017 and Q2 2018, respectively. In Q4 2018 the Bank launched euro-denominated deposits in Germany and SEK-denominated deposits were launched in Sweden early in Q1 2020. Komplett Bank sees good opportunities for growth based on its market position and financial strength at the end of 2020 and expects lending growth of 5-10% in 2021. The Bank is currently evaluating strategic possibilities for expansion, and both the Board and management are dedicated to the ambition of establishing a presence in new geographical markets and/or product categories in 2022, which can contribute to a higher growth rate. Further, the Bank has a dividend policy of distributing surplus capital not required for growth initiatives. Dividend capacity is estimated to be 30-50% of after-tax earnings, based on the Bank’s level of profitability in 2020, the balance sheet at the end of the year, and the current capital adequacy requirements. This is seen as a sustainable level of dividends even with annual growth of 10% in the medium term. Komplett Bank has a long-term target of a return of equity over 20%. Operational review Loan growth and product development The Bank follows a diversified multi-channel marketing and distribution strategy, has a resilient balance sheet and a flexible and cost-efficient operating model. Combined with a well-known brand and strong distribution capabilities, this puts Komplett Bank in a favourable competitive position. In light of increased macroeconomic risks due to Covid-19, Komplett Bank prioritised maintaining its financial strength and limited lending growth in 2020. During 2020, net loans declined by NOK 135 million to reach NOK 8.4 billion at the end of the year. This decline was driven primarily by consumer loans in Norway, which declined by NOK 531 million after subtracting NOK 65 million sold as part of the Bank’s forward flow agreement. Consumer loans in Sweden and Finland grew by NOK 340 million and NOK 55 million, respectively. 30 Board of Directors’ Report