Stock and press releases

Today, the Board of Directors of DNB ASA has sent a written report to the Ministry of Trade, Industry and Fisheries at the request of the Minister.

The background for the report is that the bank’s subsidiary in Luxembourg facilitated the establishment of companies in the Seychelles for customers. In the report, the Board of Directors presents the findings which have thus far resulted from the internal investigations. Based on the report, the Board has already asked the company to implement several measures.

"Group Legal in DNB has done a thorough job, reviewed a large number of documents and interviewed a number of employees and former employees. Based on the investigations, the Board of Directors has prepared a written report which sums up the main findings and the measures which have already been initiated to ensure that DNB’s operations are in line with both regulations and the expectations of its owners, customers and society at large,” says board chairman Anne Carine Tanum.

In addition, the Board of Directors has decided to implement additional measures:

1.The Board of Directors asks the group chief executive to consider the organisation of DNB’s operations in Luxembourg (including a description of current procedures and the division of responsibilities and roles), with special focus on private banking operations.

2.The Board of Directors asks the group chief executive to consider the products and services distributed in the private banking channels, with special focus on aspects which may give rise to reputational issues.

3.The Board of Directors asks the group chief executive to consider the principles for the management and control of international subsidiaries, with special focus on the workforce situation and resources, governance, board composition and compliance.

4.The Board of Directors will, in cooperation with the group chief audit executive, consider the expertise and resources relating to the internal audit functions.

The report and attachments (in Norwegian only) are available at:
https://dnbfeed.no/nyheter/redegjorelse-om-dnb-luxembourg/

Contact person:
Even Westerveld, EVP Corporate Communications, tel. (+47) 400 16 744

In the first quarter of 2016, the DNB Group will record a positive effect of basis swaps connected to funding of NOK 1 003 million.

In the first quarter of 2015, there was a positive effect of basis swaps of NOK 1 810 million.

Basis swaps are derivative contracts entered into in connection with long-term funding in international capital markets where the relevant currency is converted to Norwegian kroner. These swaps are hedging instruments, and over the lifetime of the derivatives the mark-to-market adjustments will have zero effect.

With effect from the second quarter of 2016, DNB will no longer report the basis swap impact ahead of its quarterly reporting.

The reason for this change is that the effect of basis swaps has become only one of many mark-to-market adjustments in the Group’s quarterly reporting, some of which will be negative and some positive. DNB believes it will be better to report and explain these effects all at once when its quarterly report is presented.

Shareholders in DNB ASA are hereby invited to attend the Annual General Meeting to be held at 3.00 pm on Tuesday, 26 April 2016 in DNB's premises in Dronning Eufemias gate 30, Bjørvika, Oslo, Norway. The Notice of Annual General Meeting is attached.

Moody’s upgraded today DNB Bank ASA’s long-term debt rating to Aa2 from Aa3. Moody’s also changed the outlook on DNB’s debt and deposit rating to negative from stable.

The upgrade of DNB’s long-term debt rating reflects an increase in loss absorbing liabilities on the balance sheet over the last several quarters. The increase in loss absorbing liabilities benefits the position of senior unsecured debt under Moody’s methodology. Moody’s also changed the outlook on DNB’s debt and deposit rating to negative from stable. The negative outlook reflects Moody’s expectations that Norway’s slowing economic growth will put pressure on earnings and increase losses within the oil-related loan portfolio.
 
For further details and complete overview of all rating changes related to DNB Bank ASA, please see attached press release from Moody’s Investors Service.

Overview of DNB Bank ASA’s long-term senior unsecured ratings:
Moody’s: Aa2, negative outlook
Standard & Poor’s: A+, negative outlook
DBRS: AA (low), stable outlook

The DNB group’s annual report and Pillar 3-report for 2015 is published today, 17th of March 2016, at DNB’s website www.dnb.no/en/ir.

Reference is made to the stock exchange announcement made on November 6th 2015. DNB has during the last month conducted a review of the strategic alternatives available related to the bank’s credit card operations that are provided through external distribution channels.

The operations that have been reviewed are organized in a separate unit in DNB Finans called Cards External Channels, which distributes credit cards under the Cresco brand, along with other credit and loyalty cards. One of the potential outcomes was a sale of all or parts of the operations to an external party. The assessment has been carried out, and DNB has concluded to keep the operations within the group. As an extension of the initial assessment, additional efforts will be initiated to further develop the business under its current DNB ownership.

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Contact persons:

Thomas Midteide, group executive vice president, Corporate Communications, tel.: + 47 962 32 017

Rune Helland, Head of Investor Relations, tel: +47 977 13 250

Amra Koluder, IR, tel: +47 977 35 378