The Financial Supervisory Authority of Norway published an inspection report finding that SpareBank 1 Ringerike Hadeland has a generally well-developed framework for managing corporate credit risk and an appropriate liquidity and funding risk framework, but needs to strengthen default identification, IFRS 9 loss provisioning and board reporting. The bank has maintained a low share of nonperforming corporate loans, although unclear terminology and inconsistent procedures may have resulted in some exposures being classified as in default too late or not at all. The board must ensure that the bank applies a common definition of default covering both payments more than 90 days overdue and exposures where the counterparty is unlikely to pay. It must also establish a more detailed, technically grounded approach to individual Stage 3 loss calculations, including documented scenarios, probability weightings and discounted cash flows. Further improvements should clarify credit criteria and deviations, strengthen assessments of repayment capacity and collateral, and expand board reporting on forbearance, geographic risk and policy exceptions. The authority also called for timely completion of overdue internal audit actions. The bank has begun addressing climate and sustainability risk, but must further develop climate scenario analysis, transition planning and the integration of climate stress testing into its Internal Capital Adequacy Assessment Process to meet forthcoming Capital Requirements Directive VI requirements and related guidelines. The board raised no material factual objections to the main findings and will prepare an internal action plan assigning responsibilities, deadlines and priorities.

Original source