Big Nordic banks reported year-over-year increases in their first-quarter net fees and commissions income and assets under management, prompting UBS analysts to upgrade their estimates of the lenders' EPS for 2021 to 2023.

With most Nordic banks posting profits in the first quarter, UBS analysts have increased their estimates of the banks' EPS for 2021 by 4.4% on average and for 2022 and 2023 by 1.4%, saying the upgrades were mainly driven by higher-than-expected fees from asset management operations. Banks attributed the increase in their fees income to strong equity prices, among other factors.

Among the six largest Nordic banks by assets, Norway's DNB ASA reported the highest rise in net fees and commissions income in the quarter of 17.56% to roughly €260 million from €210 million, S&P Global Market Intelligence data shows. The bank's total AUM increased 27.78% year over year to €80.32 billion from €55.08 billion.

Svenska Handelsbanken AB (publ)'s net fees and commissions income rose 9.74% on a yearly basis to approximately €290 million from €250 million, with its AUM increasing 40.72% over the period to €91.14 billion from €60.73 billion. Fund management, custody account management and other asset management commissions increased by 24% year over year at the bank, according to its first-quarter earnings report.

Swedish peers Skandinaviska Enskilda Banken AB (publ) and Swedbank AB (publ) also reported year-over-year increases in their net fees and commissions income amid a rise in their respective AUMs. SEB's asset management improved, to a large degree, due to strong equity prices, CFO Masih Yazdi said during the bank's first-quarter earnings call. Swedbank also reported strong asset management income from positive stock market performance, according to the bank's first-quarter earnings presentation.

Nordea Bank Abp's AUM rose 32.56% year over year, while the Finland-based bank's net fees and commissions income were up 8.10% on a yearly basis. The bank reported a 12% year-over-year rise in its first-quarter savings and investment commission income, driven by growth in AUM.

Danske Bank A/S, which reported a 5.64% year-over-year increase in first-quarter net fees and commissions income, said capital markets performance and AUM helped drive the hike.

In euro terms, the Nordic banks grew their first-quarter fees income by an average of 9.8% year over year, and the strong growth was driven by assets management and securities or advisory division, UBS analysts said in a report.