Translation: Original published in Finnish on 11/10/2026 at 9:36 am EET.

Source: Inderes, Vara Research (consensus)

Mandatum published better Q3 earnings than we expected. However, the earnings beat was explained by net financial income, which fluctuates with the capital markets. New sales in wealth management, the most important variable for Mandatum's value, fell short of our expectations. Due to strong investment commitments and steadily progressing internationalization, we do not consider this especially worrisome for shareholders, as new sales are still in positive territory.

Asset management sales were sluggish

The development of capital-light businesses was quite as expected, although the fee result remained slightly below our estimate. Nevertheless, the fee result continued to grow robustly (11% year-on-year) and increased to 24.0 MEUR. Earnings growth was driven by both an increase in assets under management and improved cost efficiency. The result of term life insurance, on the other hand, was marginally better than our expectations.

Mandatum's assets under management (AUM) developed well in line with our estimate, growing by around 1% from the previous quarter to 16.8 BEUR (forecast 16.9 BEUR). However, net subscriptions were significantly more moderate than our forecast, remaining at a modest level in absolute terms (55 MEUR vs. 150 MEUR forecast). According to management, the rapid interest rate rally delayed client investment decisions and led to increased redemptions of certain fixed-income products, even though international institutional sales continued to perform well, particularly in Sweden. Consequently, the decline in sales was not particularly dramatic, as net subscriptions remained positive nonetheless. Based on peer sales figures as well, Q3 sales were generally more sluggish than the previous quarter, which is, of course, partly explained by seasonal factors. It’s also good to remember that Mandatum has 400 MEUR worth of investment commitments in its fixed income funds. These are not yet reflected in sales figures, as capital is only reported as it is called into use. Therefore, we are not particularly concerned about the sales outlook for Mandatum's products and services because of one slow quarter. Of course, to meet the lofty expectations, it's clear that the company must accelerate beyond the pace seen in recent quarters.

The capital brought by the Cliens acquisition has not yet been reflected in Mandatum's reported figures because the transaction was completed after the quarter ended. Cliens' assets under management stood at 3.2 BEUR at the end of September, bringing Mandatum's total assets under management to approximately 20 BEUR.

Net finance result again responsible for the largest deviation from the forecast

The net finance result, on the other hand, clearly exceeded our estimate. This was driven by investment returns, which were less impacted by rising interest rates than we anticipated. However, the net finance result fluctuates quarterly with market developments, so the forecast deviation is not significant.

Mainly due to the net finance result, Mandatum's profit before taxes was also higher than our expectations at 44.1 MEUR (estimate: 37.3 MEUR). Earnings per share were EUR 0.06 for the quarter. Organic capital generation (EUR 0.15) exceeded EPS, as usual. Organic capital generation is a key figure published by the company that reflects growth in distributable wealth.

A stable balance sheet supports the outlook for profit distribution

Mandatum's Solvency II ratio was 198% at the end of Q3. Thus, solvency remains well above Mandatum's target level (160–180%) after the company divested its ownership in Saxo Bank earlier this year. We expect the company to reduce the overcapitalization on its balance sheet when it distributes next year's dividend. 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. However, the informative value of this is minimal, as we consider both to be almost certain.