Outlook for 2020
Our proven ability to execute on our strategy despite a rather turbulent environment tells me that we are on the right track. We have a strong foundation and organisation, a recovered capital position including a significant extension on the duration of our financing, the industry’s lowest funding costs and the only company in our field with an investment grade rating.
The outlook is more uncertain as a result of the rapid coronavirus development. In the near term we are seeing a temporary pause in the supply of debt portfolios, but in the long run we firmly believe that the market outlook remains positive. We anticipate that banks will continue to divest portfolios and will do so at an earlier stage than historically. The European estimated loan stock has decreased from EUR 1.2 trillion in 2014, to approximately EUR 635 billion in 2019. This is good for the financial eco-system, and I am confident in the market for non-performing loans as all market participants have become more diligent and structured, which has resulted in favourable margin developments over the last year. There is also an increased amount of transactions in the secondary market, both for non-performing loans as well as for performing loans.
Change continues to be the only constant. The best way to deal with change is to make sure that everything we do is firmly grounded in our values and with a clear purpose. I am very proud of having deeply committed employees, working together with a relentless drive towards creating long-term value for our customers and shareholders. In our Great Place to Work® survey in 2019, the feedback from the organisation was the best ever with improvements in all markets and dimensions. In 2019, we launched our leadership programme, Hoist Finance Academy, which fosters a learning environment where our managers can become strong leaders. By investing in our people, we are investing in our future.
If we can offer customers and employees the best experience possible, both in the current challenging times as well as in the long run, I am convinced financial performance will benefit. This is why operational excellence will continue to be a priority in 2020, underpinning our capacity to deliver attractive returns going forward, while maintaining our focus of helping people keep their commitments.
Klaus-Anders Nysteen, CEO