Medium term financial targets updated December 2021
| Previous | New |
Return on equity | >10% | >13% |
Operating income / REA | >6.7% | >7.3% |
Insurance premium growth | - | Premium growth (net of reinsurance) to exceed the growth of the domestic market by more than 3 percentage points |
Loan growth | The loan book will grow in line with economic growth, with growth in mortgage lending expected to outpace corporate lending | In line with nominal economic growth |
Cost to income ratio | <45% | <45% |
CET1 ratio | ~17% | ~17% |
Dividend payout ratio* | 50% | 50% |
Medium term targets are reviewed annually and the underlying horizon is up to 3 years
* Pay-out ratio of approximately 50% of net earnings attributable to shareholders through either dividends or buy-back of the Bank’s shares or a combination of both. Additional distributions will be considered when Arion Bank’s capital levels are above the minimum requirements set by the regulators in addition to the Bank’s management buffer.