Dnb Bank Asa · OSL:DNB
Dnb Bank Asa — Q1 2014 Earnings Presentation
15 slides from Dnb Bank Asa's earnings presentation, May 8, 2014
Slide 1: Q1 Investor presentation – DNB Group First Quarter 2014
Investor Q1 presentation RESULTS DNB GROUP FIRST QUARTER 2014 Rune Bjerke (CEO) Bjørn Erik Næss (CFO)
Slide 2: First quarter 2014
First quarter 2014 Pre-tax operating profit before impairment in NOK billion 7.4 (5.1) Cost/income ratio in per cent 41.3 (52.0) Return on equity in per cent 15.5 (10.0) Earnings per share 3.39 (1.96) Common equity Tier 1 capital ratio in per cent (transitional rules) 11.9 (10.6)1) Figures in parent
Slide 3: Solid development in a robust Norwegian economy
Solid development in a robust Norwegian economy Gross Domestic Product Development in oil and housing investments Mainland, year on year In 2005 prices, NOK billion Continuous GDP growth at approx. 2 per cent Still high level of investments in both oil and housing 3 Source: Statistics Norway
Slide 4: High price levels for important Norwegian goods and services – continued high portfolio quality
High price levels for important Norwegian goods and services – continued high portfolio quality and low impairments Oil price Spot Brent 1995-1Q14 Salmon Prices 2000-2013 ClarkSea Index 2009-1Q 14 Dollar/Barrel Kroner / Kg 1000$/day 160 45 25 140 40 20 120 35 100 15 80 30 60 10 25 40 5 20 20 0 15 0
Slide 5: Norwegian housing market show a upward trend again this spring
Norwegian housing market show a upward trend again this spring, post the back-drop last autumn Strong fundamentals House prices are picking up – 4 months in a row Seasonally adjusted house price index * A broad, solid increase in household’s disposable income 2.0 House price increase adjusting f
Slide 6: Positive development in asset quality – decline in net non-performing and net doubtful loans
Positive development in asset quality – decline in net non- performing and net doubtful loans and guarantees 1) Per cent 1.71 1.71 1.70 1.55 1.50 1.50 1.48 1.38 1.19 1.37 1.39 1.10 1.16 1.10 1.10 1.05 0.88 0.91 23.3 22.9 NOK billion 20.7 19.5 19.7 19.9 19.1 18.4 16.4 31 Dec. 31 Dec. 31 Dec. 31 Dec.
Slide 7: Positive development in impairment levels driven by shipping recoveries
Positive development in impairment levels driven by shipping recoveries and strong underlying development NOK millions. Credit quality will improve further, and losses are expected to be well below normalised levels 7
Slide 8: Annualised 1Q growth of 2.5% for lending and 9% for deposits
Annualised 1Q growth of 2.5% for lending and 9% for deposits NOK billion Lending Deposits 1 341 1 344 1 306 1 315 1 324 1 298 900 868 882 816 874 854 845 811 797 31 30 30 31 31 30 30 31 31 31 30 30 31 31 30 30 31 31 March June Sept. Dec. March June Sept. Dec. March March June Sept. Dec. March June S
Slide 9: Combined spread down due to higher volume growth in deposits than lending
Combined spread down due to higher volume growth in deposits than lending Per cent 2.42 2.42 2.42 2.32 Lending spread 2.18 2.21 1.98 2.01 1.83 1.28 1.29 1.30 1.25 1.16 1.18 1.18 1.22 1.20 Combined spread - weighted average 0.04 (0.11) (0.13) (0.27) (0.24) (0.29) (0.30) (0.30) (0.29) Deposit spread 1
Slide 10: Upward trend in commissions & fees – especially the “capital light” products/services are growing
Upward trend in commissions & fees – especially the “capital light” products/services are growing NOK million +12% +12% growth growth 2 185 1 981 1 935 1 956 1 757 1 806 1Q09 1Q10 1Q11 1Q12 1Q13 1Q14 Net commissions and fees Corporate finance, credit and securities broking etc. Asset management and
Slide 11: The cost-income-ratio is now below 45 per cent
The cost-income-ratio is now below 45 per cent 48.3 45.7 41.3 2009 2010 2011 2012 2013 1Q 2014 Underlying nominal costs are expected to be stable in the period up to 2016, and the Group’s cost/income ratio will remain highly competitive 11 08.05.2014
Slide 12: Common equity Tier 1 capital ratio – on track to reach all required capital levels
Common equity Tier 1 capital ratio 1) - on track to reach all required capital levels CET1 transitional rules Leverage ratio Basel III 3) Per cent Per cent 2) 5.3 5.1 11.8 11.9 10.6 10.8 11.0 4.3 4.2 4.3 31 March 30 June 30 Sept. 31 Dec. 31 March 31 March 30 June 30 Sept. 31 Dec. 31 March 2013 2013
Slide 13: Capital efficiency focus – track record so far
Capital efficiency focus – track record so far 2012 2013 1Q 2014 ~35-40 bps* ~40-45 bps* ~10 bps* Sale of non-core assets Sale of non-core assets Sale of non-core assets Product restructuring Product restructuring Sale of infrastructure company Financial restructuring Sale of non-performing assets Q
Slide 14: On track towards 2016 targets
On track towards 2016 targets Return on equity 15.5 % Target 13.6 % 13.2 % 10.6 % 11.4 % 11.7 % Return on equity > 12 per cent 2009 2010 2011 2012 2013 1Q 2014 CET 1 capital ratio (transition rules) 11.8 % 11.9 % Requirement 10.7 % 8.5 % 9.2 % 9.4 % CET1 capital ratio 13.5-14.0 per cent 2009 2010 20
Slide 15: Q&A
Q&A