Stock and press releases

DNB recorded profits of NOK 5 648 million in the third quarter of 2017, up NOK 1 568 million
from the third quarter of 2016. A solid momentum in the Norwegian economy contributed to lower losses and higher income for the bank.

“In many ways, DNB is a reflection of the Norwegian economy. When Norway Ltd. performs well,
so does the bank. This is exactly what is happening now. Optimism has got a sound foothold in the Norwegian economy. DNB’s profit performance has improved in all customer segments, ranging from private individuals to the largest companies,” says Rune Bjerke, DNB’s group chief executive.

High level of activity

DNB’s accounts for the third quarter showed a moderate reduction of NOK 24 million in net interest income from the second quarter. Lending spreads have widened somewhat during the past year, but remain below the average level in a five-year perspective.

Net other operating income was NOK 3 922 million, down NOK 7 million from the third quarter of 2016. There was a high level of activity in many of the areas where DNB holds a leading position, such as capital market transactions, real estate broking and asset management. There was also a positive contribution from DNB Livsforsikring during a quarter with sound operations.

DNB experienced a continued strong interest in savings in the third quarter. 40,000 customers established Share Savings Accounts. The bank also launched an improved version of its BSU product (home savings scheme for young people) during the quarter, allowing savings to start from birth.

Crisis control

Impairment losses on loans and guarantees totalled NOK 867 million in the third quarter, down
NOK 1 309 million from the corresponding quarter in 2016. Improved macroeconomic prospects have resulted in lower individual impairment losses and a reduction in collective impairment in the industries which have thus far been most exposed. DNB has also contributed to the successful restructuring of companies, especially in oil-related industries and shipping.

“One of the key gauges to measure the temperature of the economy is whether small and medium-sized enterprises dare take a step further, borrow money, invest, and employ more people. More than 183 000 small enterprises across Norway are DNB customers, and the figures we present today send a clear message from the Norwegian business community that we have put the oil collapse behind us. We will now look to the future,” says Bjerke.

Operating expenses increased by NOK 476 million compared with the third quarter of 2016, but declined by NOK 95 million from the preceding quarter. The increase stemmed mainly from the introduction of financial activities tax in 2017 and higher IT investments.

Financial key figures for the third quarter of 2017

•  Pre-tax operating profit before impairment was NOK 7.4 billion (7.4)
•  Profit for the period was NOK 5.6 billion (4.1)
•  Earnings per share were NOK 3.34 (2.43)
•  Return on equity was 11.2 per cent (8.5)
•  The cost/income ratio was 42.7 per cent (40.6)
•  The common equity Tier 1 capital ratio (transitional rules) was 16.3 per cent (15.7)

Comparable figures for the third quarter of 2016 in parentheses.

The quarterly report, presentation and Fact Book can be downloaded from
www.ir.dnb.no

DNB will publish its results for the third quarter of 2017 on Thursday, 26 October 2017 at 7.30 am CET.

26 October at 9.30 am CET: press conference in English accessible via live web TV
Place: DNB’s head office in Bjørvika, Dronning Eufemias gate 30, Oslo. A live broadcast will be available at ir.dnb.no

Please register your attendance in Oslo at [email protected].
The press conference will be held in English.

26 October at 1.30 pm CET: conference call for analysts and investors
To attend the conference call: dial (+47) 21 56 33 18 or from outside Norway: +44 (0) 20 3003 2666 or from the US: +1 212 999 6659.  Password: DNB Q3

The phonecast (listen only mode) and replay will be available on at ir.dnb.no/

27 October at 12.30 pm GMT: lunch conference for analysts and investors in London
Place: Citigroup Stirling Square, 5-7 Carlton Gardens, 3rd floor, London, SW1Y 5AD.
Please register your attendance in London at [email protected].

Management will present the results followed by a Q&A session.

DNB will publish its results for the third quarter of 2017 on Thursday, 26 October 2017 at 7.30 am CET.

26 October at 9.30 am CET: press conference in English accessible via live web TV
Place: DNB’s head office in Bjørvika, Dronning Eufemias gate 30, Oslo. A live broadcast will be available on the Investor Relations pages at www.dnb.no.
Please register your attendance in Oslo at [email protected].

The press conference will be held in English.

26 October at 1.30 pm CET: conference call for analysts and investors
To attend the conference call: dial (+47) 21 56 33 18 or from outside Norway: +44 (0) 20 3003 2666 or from the US: +1 212 999 6659.  Password: DNB Q3

The phonecast (listen only mode) and replay will be available on the Investor Relations pages at www.dnb.no.

27 October at 12.30 pm GMT: lunch conference for analysts and investors in London
Place: Citigroup Stirling Square, 5-7 Carlton Gardens, 3rd floor, London, SW1Y 5AD. Please register your attendance in London at [email protected].

Management will present the results followed by a Q&A session.

On 25 August 2016 DNB and Nordea entered into an agreement to combine their operations in Estonia, Latvia and Lithuania in order to create a leading independent main financial services provider in the Baltics. The completion was conditional upon receiving regulatory approvals. After receiving all approvals from the respective regulatory bodies, the transaction closed today.

Luminor will be the third largest financial services provider in the Baltic banking market with a market share of 16 per cent in deposits and 23 per cent in lending. Luminor will comprise Nordea’s approximately 350,000 and DNB’s 930,000 customers across the three markets. The operations will have approximately 3,000 employees and approximately EUR 15bn in assets. Total gross lending of the Luminor portfolio will amount to approximately EUR 12bn including both consumer and corporate lending and deposits will total EUR 9bn. Luminor will have a common equity tier 1 capital ratio of 17 per cent and a common equity tier 1 capital of EUR 1.6bn.

DNB will hold 44 per cent of the economic rights and 50% of the voting rights of the new company. In DNB’s results, Luminor will be accounted for using the equity method from Q4 2017.

Media inquiries:
EVP Corporate Communication: Even Westerveld +47 400 16 744
Group EVP Corporate Communication: Thomas Midteide +47 962 32 017

During week 38 and 39 2017, DNB ASA has purchased 818,000 own shares at an average price of NOK 160.24 per share. After this, DNB ASA owns a total of 6,193,034 own shares.

The repurchase of shares is part of the new share buy-back programme announced by DNB ASA on 21 September 2017. The buy-back programme comprises up to approximately 8.1 million shares, of which up to approximately 5.4 million will be repurchased in the open market. The rest will be redeemed from the state of Norway on a proportionate basis, subject to approval from DNB ASA’s annual general meeting in 2018, so that its current ownership interest of 34.00% will remain unaffected following completion of the buy-back programme.

For further information about the share buy-back programme, DNB ASA refers to the Oslo Stock Exchange notification made on 21 September 2017 (available from www.newsweb.no).

DNB ASA has decided to initiate a new share buy-back programme. Similarly to the share buy-back programme completed by DNB ASA on 14 August 2017, the new share buy-back programme would also comprise up to 0.5% of its registered shares, representing a total of approximately 8.1 million shares.

The share buy-back programme will be carried out on the basis of the authorization given by DNB ASA’s annual general meeting on 25 April 2017, where it was approved that DNB ASA may repurchase shares up to a maximum of 1.5% of its registered shares for purposes of enabling an optimal level of capital in the company. DNB ASA may at a later stage decide to initiate further share buy-back programmes, up to the maximum of 1.5% as approved by the annual general meeting.

Up to approximately 5.4 million of the shares comprised by the share buy-back programme will be repurchased in the open market. The remaining shares will be redeemed from the state of Norway through the Ministry of Trade, Industry and Fisheries, according to an agreement between DNB ASA and the state of Norway and subject to approval from DNB ASA’s annual general meeting in 2018. According to the agreement, the state of Norway shall redeem shares on a proportionate basis so that its current ownership interest in DNB ASA of 34.00% remains unaffected following completion of the buy-back programme.

DNB ASA will seek approval from the annual general meeting in 2018 for cancellation of the repurchased shares and a corresponding redemption of the proportionate number of shares owned by the state of Norway. The redemption of the shares owned by the state of Norway shall be made against a payment which shall correspond to an average volume weighted price of DNB ASA’s repurchase of shares in the open market as a part of the buy-back programme, including an interest compensation and an agreed adjustment for dividend paid on the redemption shares in the buy-back period (if any).

For further information, DNB ASA refers to the minutes from DNB ASA’s annual general meeting of 25 April 2017, available at www.dnb.no.