Six good reasons for choosing DNB in the new banking environment UBS Conference 12 September, Stockholm Rune Bjerke, CEO of DNB 1
Reason 1: DNB’s Norwegian platform 2
Norway- one of the strongest home markets globally General government net financial liabilities Average real GDP growth 1990 - 2012 (As percentage of nominal GDP 2012) 2.8 -200 -150 2.1 -100 1.8 1.5 -50 0 50 100 150 Norway* Sweden Finland Denmark * Mainland Source: DNB Markets and OECD Economic Outlook, May 2012 3
A strong position - Market leader in Norway and leading within selected global industries Significant market share Global leader within selected industries #1 shipping and offshore bank globally One of the world’s leading seafood banks A leading international energy bank DNB Other Source: DNB Markets 4
Reason 2: DNB’s strong track record of competitive returns 5
Sustainable achievements – We have delivered on our promises Development in pre-tax operating profit before impairment (NOK billion) CAGR: 7.5 % 21.8 21.1 20.8 18.7 7.7 15.6 3.5 3.4 3.2 3 11.2 1.7 2008 2009 2010 2011 2012 H113 Pre-tax operating profit before impairment Impairment 6
Stable returns in spite of an increasing capital base 20,0 % 140 18,0 % 118 116 120 16,0 % 104 100 94.9 14,0 % 89.6 13.6% 12,0 % 12.4% 80 70.1 11.6% 11.4% 11.2% 10,0 % 10.6% 60 8,0 % 6,0 % 40 4,0 % 20 2,0 % 0,0 % 0 2008 2009 2010 2011 2012 2Q 2013 CET1 capital (NOK billion) Return on equity (%) 7
Reason 3: DNB’s favourable funding position 8
Highest deposit-to-loan ratio Deposit-to-loan ratio: DNB Deposit-to-loan ratio: Nordic banks (Per cent, 2Q13) (Per cent) 75 75 70 68 63 58 58 54 55 53 50 48 39 DNB Bank 1 Bank 2 Bank 3 Bank 4 Bank 5 Source: 2Q 2013 from the financial institutions 9
Stable access to long-term funding and decreasing funding costs 5-year senior and covered bonds Indicative Trading Level Spreads NOK 200 150 100 50 0 -50 2007 2008 2009 2010 2011 2012 2013 DNB 5Y senior unsecured DNB 5Y covered bonds Source: DNB Markets 10
Reason 4: DNB’s potential for growth in quality earnings 11
Stable growth in net interest income 28 266 + 6.8 per cent 27 419 + 5.9 per cent 27 216 + 7.8 per cent 26 907 + 9.3 per cent 26 473 + 9.4 per cent 25 887 + 8.3 per cent 25 252 24 613 24 197 30 June 30 Sept. 31 Dec. 31 March 30 June 30 Sept. 31 Dec. 31 March 30 June 2011 2012 2013 All numbers are in NOK Million 12
Still high potential in non-capital-intensive areas 44 56 56 60 63 72 56 44 44 40 37 28 Bank1 DNB Bank2 Bank3 Bank4 Bank5 Net interest income as a percentage of total income (%) Net other operating income as a percentage of total income (%) Source: Second quarter report 2013 from the financial institutions 13
Several areas with high expected growth Norway has the world’s Issuance of non-financial Growth potential in the bonds in Norway at all-time highest growth in USD non-life insurance market high in 2012 millionaires Development in number Issuance of non-financial bonds Non-life insurance market of USD millionaires, in Norway in NOK million Norway 2010 2011 6.2% 90 000 5% 2012 2013 64 95% 55,3 DNB Others 2010 2011 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 14
Reason 5: DNB’s firm actions for cost reductions 15
Firm actions for cost reductions ensures competitive cost efficiency Cost/income ratio* – Nordic banks 2013 61% 52% 50% 50% 48% 46% Bank 1 DNB Bank 2 Bank 3 Bank 4 Bank 5 Source: Company Reports Q213 * Ratios ‘as reported’ 16
Reason 6: DNB’s solid capital base 17
Perceived solidity is not best in class – different risk weights due to local regulatory requirements Equity Tier 1 ratio Basel III Per cent 17.8 17.2 14.2 14.0 12.1 DNB Bank 1 Bank 2 Bank 3 Bank 4 Source: Second quarter report 2013 from the financial institutions 18
Risk-adjusted capital places us among the most solid banks DNB’s risk -adjusted capital versus peers 2013 9.42% 8.86% 8.25% 8.22% 8.21% 7.78% Bank 1 DNB Bank 2 Bank 3 Bank 4 Bank 5 Standard and Poor’s 2013 19
Six good reasons for choosing DNB in the new banking environment 1 Our “Norwegian” platform Our strong track record of competitive returns 2 3 Our favourable funding position Our potential for growth in quality earnings 4 5 Our firm actions for cost reductions 6 Our solid capital base 20 |
Some kind of sum up- that confirmes that we are creating values in spite of a low growth environment 21 |
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