Nordea targets return on equity exceeding 15% in 2026–2030

By Elviira Luoma

(Reuters) -Nordea, the Nordic region's biggest bank, is targeting a return on equity of more than 15% between 2026 and 2030, and significantly above that in 2030, it said in a statement ahead of its investor day on Wednesday.

Nordea will target profitable growth in each of its businesses, the bank said, with a special focus in Norway and its biggest market, Sweden.

The Helsinki-listed lender also said it expected a cost-to-income ratio of 40–42% in 2030, excluding regulatory fees.

These new targets will be complemented by annual dividend payouts of 60–70% of earnings, semi-annual dividend distributions, and more than 20 billion euros ($23 billion) in total shareholder distributions during 2026-2030, Nordea said.

Interim distributions will be based upon 50% of first-half profits for each financial year, it added.

The bank also said it expected its core tier 1 ratio, a key measure of its financial strength, to be about 15.5% throughout the period.

Nordea's shares fell around 3% by early afternoon in Helsinki, making it the worst performer on Finland's blue-chip index.

STABLECOIN PLANS IN EUROPE

A consortium of nine European banks, including heavyweights ING and UniCredit, said in September they were forming a new company to launch a euro-denominated stablecoin, a move they hoped would help counter U.S. digital market dominance.

"We were invited to be part of that. And at this stage, we're maintaining a watching brief," Chief Financial Officer Ian Smith told Reuters, adding that Nordea would have an opportunity to join in later if it thought it was the right move. 

The European Central Bank has remained skeptical. ECB President Christine Lagarde in June told European policymakers that privately issued stablecoins posed risks for monetary policy and financial stability.

"We're keeping a close eye on a number of different developments, including the ECB's initiative to launch a digital euro," Smith said.

($1 = 0.8575 euros)

(Reporting by Elviira Luoma in Gdansk, editing by Matt Scuffham and Milla Nissi-Prussak)