Growth in lending helps Nordea beat profit estimates

By Essi Lehto

HELSINKI (Reuters) -Finland's Nordea Bank on Thursday followed Nordic peers by posting quarterly earnings that beat analysts' estimates as lending volumes grew and the bank reported no loan losses despite growing financial uncertainty.

The biggest Nordic lender saw its net fee and commission income rise 5% to 870 million euros ($915 million). Net interest income climbed 8% to 1.3 billion euros.

OP analyst Antti Saari said he saw credit demand decreasing in the future due to rising interest rates and inflation eating into purchasing power. But at the same time, rising rates generate interest income for banks, he added.

"The net effect should be positive because Scandinavian banks are very capable at handling credit risk," he said.

"We expect to get a clearer picture of the potential effect of the macroeconomic impacts on our customers during the second quarter," Nordea's Chief Executive Officer Frank Vang-Jensen said in a statement.

The bank's January-March operating profit rose to 1.1 billion euros from 1 billion a year earlier, beating analysts' average forecast of 963 million, according to Refinitiv IBES data.

The result may offer Finnish financial group Sampo an opportunity to sell some or all of its remaining 6% stake in Nordea, Saari said, adding he saw Nordea's share price rising when Helsinki bourse opens at 0700 GMT.

"If the share rise is good, it won't necessarily take that many days for Sampo to do the next placing as it is clear that they want a complete exit," Saari said.

Sampo has been cutting its holding in Nordea during the past year in a strategic shift to focus on its insurance business.

($1 = 0.9507 euros)

(Reporting by Essi Lehto Editing by Shounak Dasgupta and Mark Potter)