The rating reflects the bank’s relatively low risk business model and strong market position in an economically sound local area of south-east Norway. Totens serves mainly retail customers, with over 70% of lending being comprised of residential mortgages.

The bank generates healthy profits, supported by good cost efficiency and low credit costs. For the nine months ending 30 September 2020, the group reported a return on equity of 9.6%. While elevated compared to prior years, credit impairments remain at levels which can be comfortably absorbed by earnings.

Solvency metrics are also sound, underpinned by Totens’ savings bank business model. The bank’s reliance on market funding is a risk.

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