DNB recorded profits of NOK 5 062 million in the second quarter of 2015, up NOK 508 million from 2014. Higher volumes, wider deposit spreads and an increase in net commissions and fees contributed to the sound performance.

“We are very satisfied with the Group’s second quarter results. We have a robust portfolio and low impairment losses on loans, and doubtful loans and guarantees show a downward trend. In addition, we are succeeding in increasing non-lending income, for example from real estate brokerage and interest rate and currency hedging. We observe that our customers appreciate that DNB can provide a total range of financial services,” says Rune Bjerke, group chief executive.

Easier money transfers with DNB
At the beginning of June, DNB launched Vipps, a mobile app that conveniently and simply transfers money between people. Initial reactions show that this is something customers have been waiting for. After just five weeks, the app has been downloaded more than 390 000 times, and more than 285 000 people have started using it.

"Vipps is a success. The response from customers has been overwhelming, and we believe that this will further reinforce our position within payment transfers. DNB is at the forefront of digital development, but we find that our customers are actually one step ahead of us. Such an exciting situation challenges us to deliver continuous innovation," says Bjerke.

Sound portfolio, with reduction in non-performing loans
There was an average increase in DNB’s loan portfolio of 9.6 per cent parallel to a 7.3 per cent increase in deposit volumes from the second quarter of 2014. The strong rise in volumes was partly due to exchange rate movements. Lending spreads narrowed slightly during the quarter, while deposit spreads widened. The cost/income ratio for the quarter was 42.8 per cent. Impairment losses on loans and guarantees totalled NOK 667 million, increasing by NOK 113 million from the second quarter of 2014.

“We have previously estimated that impairment losses on loans will be in the range of NOK 3-4 billion in 2015. This is probably a bit too high. Based on the Group’s performance in the first half of the year and what we know today, we expect impairment losses to total just under NOK 3 billion,” says Bjerke.

Non-performing and doubtful loans and guarantees were reduced by NOK 3.0 billion from end-June 2014, totalling NOK 13.1 billion at end-June 2015. DNB Markets performed very well during the quarter and was a strong contributor, along with DNB Eiendom, to the 14.5 per cent* increase in commissions and fees. During the quarter, DNB Eiendom consolidated its position as Norway’s largest real estate broker. DNB Livsforsikring also reported strong profits.

“Buffers” in the Norwegian economy
There is still moderate growth in the global economy, and the Norwegian economy looks set to enter a period with considerably lower growth than in the past 6-7 years.

“The Norwegian economy has important buffers which nevertheless ensure a soft landing. Interest rate cuts are helping to sustain households’ purchasing power and to keep the Norwegian krone weak. A weak krone means higher profitability and improved competitiveness for exporters, who are also experiencing an increase in demand from other countries,” says Bjerke.

Key figures for the second quarter of 2015

• Pre-tax operating profits before impairment were NOK 7.4 billion (6.7)

• Profit for the period was NOK 5.1 billion (4.6)

• Earnings per share were NOK 3.04 (2.80)

• Return on equity was 12.1 per cent (12.4)

• The ordinary cost/income ratio was 42.8 per cent (43.8)

• The common equity Tier 1 capital ratio (transitional rules) was 13.0 per cent (12.1)

  Comparable figures for 2014 in parentheses.

  This information is subject to the disclosure requirements pursuant to section 5-12 of the
  Norwegian Securities Trading Act.

*The figure has been adjusted for income from public sector activities within life insurance that are in the process of being wound up.

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

The quarterly report, presentation and Fact Book can be downloaded from
www.dnb.no/investor-relations

DNB has agreed with Lindorff Capital AS, part of the Lindorff Group, to sell several portfolios of non-performing loans in Norway. The portfolios consist of unsecured claims from DNB’s consumer and equipment financing operations and corporate banking operations, dating from 1984 to 2015.

As a result of the transaction, DNB will make reversals on earlier impairment losses related to the various portfolios. The current estimated pre-tax effect is approximately NOK 1.1 billion.

The sale has been initiated as part of the Group’s capital efficiency programme.

Lindorff Group is one of Europe’s leading partners for handling non-performing portfolios. The company has 3,500 employees in 13 countries with headquarters in Oslo, Norway. In 2014, Lindorff generated € 475 million in net revenue.

DNB Markets acted as financial adviser for DNB in connection with the transaction

-----

Press contacts:

DNB: GEVP Corporate Communications, Thomas Midteide: (+47) 96 23 20 17

Lindorff Norway: Head of Communications, Stig Inge Eikemo: (+47) 90 07 03 84

Investor Relations contacts:

DNB: Head of Investor Relations, Rune Helland: (+47) 23 26 84 00

Lindorff Group: Director Investor Relations, André Adolfsen: (+ 47) 24 16 26 26

In the third quarter of 2015, the DNB Group will record a positive effect of basis swaps connected to funding of approximately NOK 933 million.

In the third quarter of 2014, there was a positive effect of basis swaps of NOK 449 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.

The positive basis swap effect in the third quarter will be partly offset by negative effects from increased credit spreads and increased credit costs on derivatives (CVA/DVA).

For further information, please contact Investor Relations in DNB:
Rune Helland : +47 97713250
Thor Tellefsen : +47 91544385

07:30 CET – result release
DNB’s 3Q 2015 results will be released at 07:30 am CET on Thursday, 22 October 2015, and we would like to invite you to the following presentations:

09:30 CET – press conference & live web-TV
A press conference (in Norwegian) will be held on Thursday, 22 October at 9:30 am CET at DNB’s head office in Bjørvika, Dronning Eufemias gate 30, 0191 Oslo. For those who are unable to attend the presentation in Bjørvika, there will be a live web-TV broadcast of the conference (in Norwegian). For further information, please visit www.dnb.no/ir. Please register your attendance in Oslo at [email protected]

14:00 CET – investors and analyst conference call & phone-cast
A conference call for investors and analysts will be held on Thursday, 22 October at 2:00 pm CET. To attend the conference call we kindly ask you to dial in 10 minutes before start +47 21 56 33 18 or international: +44 (0)20 3003 2666 or US+1 646 843 4608. Password: DNB Q3. You can also attend the call by listen only mode at the phone-cast link: http://presenter.qbrick.com/?pguid=dfc3b0af-5b15-4ced-a6c2-b0ab64856964. A replay of the phone-cast will be available after the call (at the same link as above).

Friday 23 October 0715 for 0730 GMT – analyst/investor breakfast in London
An analyst/investor breakfast will be held in London on Friday, 23 October at 0715 am for 0730 am (local time/GMT) at Hotel Andaz, 40 Liverpool Street, EC2M 7QN London (please note the address). Please register your attendance in London: [email protected]

For further information, please contact:
Rune Helland, Head of IR, phone: +47 23 26 84 00 / mobile: +47 977 13 250
Thor Tellefsen, e-post: [email protected] phone: +47 23 26 84 04 / mobile:+47 915 44 385

DNB recorded profits of NOK 6 363 million in the third quarter of 2015, up NOK 743 million from the third quarter of 2014. Higher volumes and wider deposit spreads helped raise profits.

“This is one of DNB’s best quarterly performances ever, which gives us reason to be satisfied. The figures show that the Norwegian economy is still growing, even though the situation is challenging for many companies in oil-related industries. I am also very pleased that our customer satisfaction scores are continuing to improve,” says Rune Bjerke, group chief executive.

There was an average increase in the healthy loan portfolio of 10.0 per cent parallel to a 12.6 per cent increase in average deposit volumes from the third quarter of 2014. The growth in volumes reflected the weaker Norwegian krone rate. Lending spreads narrowed slightly during the quarter, while deposit spreads widened. Volume-weighted interest rate spreads were unchanged compared with the third quarter of 2014.

Increase in Tier 1 capital
Including 50 per cent of interim profits, the common equity Tier 1 capital ratio increased from 12.6 per cent at end-September 2014, to 13.1 per cent. Based on an unchanged dividend payout ratio from 2014 (30 per cent), the common equity Tier 1 capital ratio was 13.4 per cent.
 “DNB is one of the world’s best capitalised banks, and we are continuing to build more Tier 1 capital in line with the regulatory requirements. We are following our plan to reach the targets set to be able
to normalise our dividend payments as soon as possible,” says Bjerke.

Focus on digital products
DNB is continuing its modernisation process by developing new digital products.
“Vipps is our most important product launch in a very long time. It is hard to believe that more than 900 000 Norwegians have downloaded the app four months after it was introduced. We will work contiuously to build more functions into Vipps in cooperation with our customers,” says Bjerke.

DNB’s customers are continuing to increase their use of the bank’s digital services, and the mobile phone will represent the largest growth. In the third quarter, 86 per cent of savings products were sold online, which is a significant rise from last year.
"This is the first quarter we have registered more than 40 million visits to our mobile bank. The launch of FingerID enables even faster log-on, and some 40 000 customers already use their finger to identify themselves in the mobile bank. It cannot be done faster than this," says Bjerke.

Increase in impairment losses
Ordinary operating expenses were on a level with the year-earlier period.
There were net reversals on impairment losses of NOK 392 million in the third quarter.
In late September, DNB signed an agreement with Lindorff Capital AS to sell portfolios of non-performing loans. Adjusted for this transaction, impairment losses totalled NOK 675 million for the quarter, compared with NOK 183 million in the third quarter of 2014.
The largest impairment losses on individual loans stemmed from the mining industry and the shipping sector. The total level of impairment was nevertheless below the normalised long-term level.

Key figures for the third quarter of 2015

• Pre-tax operating profits before impairment were NOK 8.1 billion (7.6)

• Profit for the period was NOK 6.4 billion (5.6)

• Earnings per share were NOK 3.83 (3.45)

• Return on equity was 14.7 per cent (14.8)

• The ordinary cost/income ratio was 39.6 per cent (40.4)

• The common equity Tier 1 capital ratio (transitional rules) was 13.1 per cent (12.6)

  Comparable figures for 2014 in parentheses.

  This information is subject to the disclosure requirements pursuant to section 5-12 of the
  Norwegian Securities Trading Act.

Contact person:
Thomas Midteide, group executive vice president, Corporate Communications, tel.: + 47 962 32 017
Rune Helland, head of Investor Relations, tel: +47 977 13 250

The quarterly report, presentation and Fact Book can be downloaded from
www.dnb.no/investor-relations

The outcome from the Norwegian FSA’s Supervisory Review and Evaluation Process (SREP) for 2015 is now finalised. The Pillar 2 requirement for DNB Bank, the DNB Bank Group and the DNB Group is 1.5 per cent of risk-weighted assets (RWA). The Pillar 2 requirement relates to risks not covered by Pillar 1 and must be met with CET1 capital.

The Pillar 2 requirement comes in addition to the minimum and combined buffer requirements under Pillar 1. By year-end 2015, the resulting CET1 requirement will be 13.5 per cent. Due to increases in the combined buffer requirements in 2016, the CET1 requirement will be 15.0 per cent by year-end 2016. The requirements will be adjusted to reflect any future changes in the Pillar 2 add-on or the buffer requirements.

The DNB Group reported a CET1 ratio of 13.1 per cent as at 30 September 2015, including 50 per cent of interim profits (13.4 per cent when including 70 per cent of profits).

DNB will reach the requirements through a combination of retained earnings, dynamic management of the balance sheet and strengthened capital efficiency measures. Further details will be communicated at DNB’s Capital Markets Day on 25 November.

DNB’s dividend policy remains unchanged, targeting a payout ratio of more than 50 per cent once the capital requirement has been reached. The dividend for 2015 is expected to be at approximately the same level as for 2014.

This information is subject to the disclosure requirements pursuant to section 5-12 of the
Norwegian Securities Trading Act.

Contact person:
Thomas Midteide, group executive vice president, Corporate Communications, tel.: + 47 962 32 017
Rune Helland, head of Investor Relations, tel: +47 977 13 250

DNB is pleased to invite you to our

CAPITAL MARKETS DAY

Date: Wednesday 25 November 2015

Time: 12:30 pm – 4:30 pm including Q&A

Location: Hotel Claridge's, Brook Street, Mayfair, London W1K 4HR, England

Registration & lunch from 11:30 am – 12:30 pm

We will present important issues for DNB in today’s rapidly changing business environment. Topics will include operating environment, financial ambitions, capital management and business units’ updates with focus on development in Retail Banking, IT and Risk Management.

REGISTRATION

We encourage you to register online at https://www.deltager.no/CMD2015.
The closing date for registration is 20 November 2015.
The event will also be webcasted.

We look forward to seeing you in London.

On behalf of DNB ASA,
Rune Bjerke,
CEO, DNB

DNB has decided to initiate a process to assess various strategic alternatives related to the bank’s credit cards that are provided through external channels. This affects around one-third of the bank’s total credit card portfolio. Credit cards under the DNB brand are not encompassed by this process.

The operations under review are organised 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. In addition to pure credit card-based products, the unit offers consumer loans and combined deposit and credit cards. This unit has assets of about NOK 6 billion. The products are distributed through separate distribution channels (such as www.cresco.no) and through third-party distributors and partners, mainly retailers and organisations.

Credit cards operated under the DNB brand represent around two-thirds of the bank’s total credit card portfolio. These operations are not encompassed by the above strategic assessment.

DNB will now explore all possibilities and seek to find the best long-term solution for both DNB and these operations. The assessment could result in the sale of all or parts of the operations, though it is also possible that the operations will be retained in DNB. A potential sale will have a positive effect on DNB’s Tier 1 capital.

DNB Markets serves as financial advisors.

-----------
Contact persons:
Rune Helland, head of Investor Relations, tel: +47 977 13 250
Thomas Midteide, group executive vice president, Corporate Communications, tel.: + 47 962 32 017

DNB is pleased to invite you to our

CAPITAL MARKETS DAY

Date: Wednesday 25 November 2015

Time: 12:30 pm – 4:30 pm GMT including Q&A

Location: Hotel Claridge's, Brook Street, Mayfair, London W1K 4HR, England

Registration & lunch from 11:30 am – 12:30 pm GMT

We will present important issues for DNB in today’s rapidly changing business environment. Topics will include operating environment, financial ambitions, capital management and business units’ updates with focus on development in Retail Banking, IT and Risk Management. The full DNB management team will be present.

REGISTRATION

We encourage you to register online at https://www.deltager.no/CMD2015.
The closing date for registration is 20 November 2015.
The event will also be webcasted.

We look forward to seeing you in London.

On behalf of DNB ASA,
Rune Bjerke,
CEO, DNB