SpareBank 1 Helgeland serves a sparsely populated Norwegian coastal region (Helgeland, southern Nordland). The listed instrument is an equity certificate ('egenkapitalbevis'). FY2025: NI NOK 470M on avg equity NOK 5,250M = ROE 8.9%. Below the 10% cost of equity — residual income is negative (-NOK 55M). This makes HELG.OL a value-trap candidate: at 0.84x book it screens cheap, but below-COE returns mean the discount is fundamentally justified.
The SpareBank 1 alliance provides technology platforms, mortgage pricing access, and products that a standalone bank could not afford — but does not overcome the structural below-COE returns. Lending is concentrated in the oil-related coastal economy (fisheries, offshore supply). HOLD pending ROE improvement. Target-implied return is primarily the dividend yield (~4-5% estimated).
Gordon fair P/B = (ROE-g)/(COE-g) = (0.089-0.03)/(0.10-0.03) = 0.059/0.070 = 0.84x. At P/book 0.84x the stock trades exactly at the Gordon implied fair value for below-COE returns — no discount, no premium. Base NOK 420 (stable at current P/book ~0.84x; dividend yield ~4.5%); bull NOK 480 (ROE improves toward 11% on margin expansion or higher rates); bear NOK 360 (loan loss normalization + P/book derating to 0.72x).
Residual-income panel unavailable: shares outstanding unavailable.
| Scenario | 24m target | Upside | Prob. | Driver |
|---|---|---|---|---|
| Bull | NOK 480 | +186% | 25% | Rate environment pushes ROE above COE; P/book re-rates to 1.0x |
| Base | NOK 420 | +150% | 45% | Stable below-COE bank; dividend yield is the return |
| Bear | NOK 360 | +114% | 30% | Loan losses rise + NIM compression + P/book derates toward 0.72x |
| Prob-weighted | NOK 417 | +148% | 100% | Scenario-weighted expected value |
Leading Helgeland savings bank; stable deposit base and lending relationships.
Higher-for-longer rates support NII and push ROE toward/above COE.
SpareBank 1 membership provides technology and product access.
~4-5% yield provides return floor while awaiting ROE improvement.
HELG.OL is a below-COE regional savings bank trading at Gordon-implied fair value (0.84x book for ROE 8.9%). The discount compensates for negative EP but provides no margin of safety. HOLD; base NOK 420.
Every adjustment traces to the cited note/page in the source filing — click to open it there. Source reports archived locally.
| Adjustment / figure | Value | Source | Why mttssn treats it this way |
|---|---|---|---|
| Net interest income | 680 | Income Statement | NIM ~2.2% on earning assets ~NOK 31B. Norwegian rate environment positive for NII 2023-2025 |
| Net income | 470 | Income Statement | Net income ~NOK 470M (ROE ~8.9%). Below system average due to geographic concentration |
| Owners equity | 5,300 | Balance Sheet | Owners equity ~NOK 5.3B. P/book 0.84x. CET1 ~18% vs 15% minimum |
How the mttssn view has evolved — each prior dated note is preserved.