Mandatum Q3'25 flash comment: Strong development continued

Translation: Original published in Finnish on 11/11/2025 at 9:30 am EET.

Source: Inderes, Vara Research (consensus)

Mandatum’s Q3 result was clearly better than our estimates. Most of this difference can be attributed to quarterly fluctuations in the net finance result, but the earnings development in asset management was also stronger than expected, thanks to improved cost efficiency. As expected, new sales in asset management also performed well.

Improved cost efficiency boosted earnings growth

Development in capital-light businesses remained robust, with fee result growing 20% year-on-year to 21.7 MEUR. The better-than-expected profitability development was driven by continued significant improvements in cost efficiency. Part of this was due to seasonally lower costs in Q3. Sales also remained strong in the typically slower Q3, with Mandatum's net subscriptions amounting to 160 MEUR (Q3’24: +114 MEUR). While peer reports have generally been strong, Mandatum's performance has been excellent, even compared to them. Favorable capital market movements during the quarter supported growth in assets under management and fee income. Assets under management at the end of Q3 totaled 14.9 BNEUR (forecast 14.8 BNEUR).

Share portfolio returns increased net finance result

The result of risk life insurance was somewhat weaker than our expectations (2.6 MEUR vs. 3.7 MEUR forecast). However, this item fluctuates quarterly, especially with insurance claims.

The net finance result, on the other hand, was clearly higher than anticipated. This was mainly due to equity investments in the investment portfolio, which generated significantly higher returns than we had forecasted for Q3. Meanwhile, interest income and imputed interest expenses were in line with market movements during the quarter. Thanks to higher investment returns, the net finance result rose to 39.4 MEUR.

With the help of the net finance result and the development of earnings in asset management, Mandatum's profit before taxes also clearly surpassed our forecast. Q3 profit before taxes was 55.7 MEUR (forecast 44.0 MEUR), and EPS was EUR 0.09. Organic capital generation exceeded this clearly, amounting to EUR 0.14. Organic capital generation is a key figure issued by the company that reflects growth in distributable profit.

No surprises in the outlook

There was no significant change in Mandatum's solvency in Q3 compared to the previous quarter, with a Solvency II ratio of 191% (Q2’25: 193%). The company still has excess capital on its balance sheet relative to its target level (160–180 %), and furthermore, its overcapitalization will increase towards the end of the year in connection with the sale of Saxo shares. Regarding the sale of Saxo, the company commented that, due to the approval process, the transaction may only be completed early next year. Previously, the sale of shares and the resulting significant increase in solvency were expected to occur already in Q4.

Meanwhile, the outlook for the current year is fully in line with expectations, as Mandatum estimates that its fee result will increase from the previous year and that its with-profit portfolio will continue to decrease further.