Dnb Asa Sp/Adr

Hello and welcome to the dnb quarter 4 conference call. My name is Caroline and I'll be your coordinator for today's event. Please note this call is being recorded and for the duration of the call your answer will be on listen only mode. However, you'll have an opportunity to ask questions at the end of the call. This can be done by pressing star 1 on your telephone keypad to ask a question. If you require any assistance, please press star 0 and you'll be connected to an operator. I will now hand over the call to your host Roon Helen. to begin today's conference. Thank you.

Thank you so much and a very welcome to all of you to the fourth quarter's analyst call. Around the table here in Oslo we have, in addition to Kerstin and Ida, we have the Head of Personal Banking, Maria Lövvold, and of course the Head of Large Corporate, Harald Sark-Hansen, and the Head of Corporate Banking, Norway, Erasmus Siegenskjær. We also have Head of D&D Markets, Alexander Oppstad, and also, of course, the Head of Wealth Management, Håkon Hansen. Before we open up for questions, Ida, we'll do some of the highlights for the quarter.

Hello, and thank you all for taking the time to participate in this course. I'll start with a bit of brief update on the Norwegian macro, which continues to be robust. All year mainland GDP growth is projected to be 0.9% in 2024. In 2025 we expect an uptick in growth to 1.5% and further slight increases in the coming years. Household consumption. increased towards the end of the year and was clearly up from the first quarter last year. This is supported by the increase in real wages and of course low unemployment levels that remains at around 2%. The housing market increased in activity levels during the second half in 2024 and we continue to see a good activity level also moving into 2025. Inflation levels have come down but remain higher than the central bank's long-term target of around 2%. Wage growth was around 5.3% in 2024 and is expected to be around 4.4% in 2025 and 3.5% in 2026. As you know, the Norwegian Central Bank has kept the key policy rate at 4.5% and is expected to start to decrease it by 25 basis points in March. Our macroeconomists in D&B markets expect 2,000 cuts from there to end at a terminal rate of 3.75%. I would, however, also like to add to the fact that Norway is a small economy and, of course, also dependent on the overall macroeconomic development globally. If we move on to the results from BNB in the fourth quarter, there was a strong performance in all customer segments as well as in all product areas. The return on equity of 19% in the quarter shows a strong growth momentum and activity across the board. If we adjust for an extraordinary low tax rate, the return on equity for the quarter was 16.1%, also well above our long-term target of being above 14%. Net interest income was up 3.7% from the third quarter 2024, driven by profitable lending and deposit growth in all segments, where we saw loan growth of 2.5% and deposit growth of 4.7%, higher financing activity and a solid income from treasury-related income. Net commission and fees was up 12.3% from a strong quarter, fourth quarter 2023. We saw an all-time high fourth quarter, driven by strong results across product areas, but I would in particular like to point to debt capital markets, as well as asset management that continues to deliver strong results in this period. We have a robust and well-diversified credit portfolio, 99.3% of the portfolio is in stage one and two, and we have impairment provisions of 157 million in the quarter. The board is proposing a dividend of 16.75 kroner per share, an increase from 16 kroner last year, also well in line with our dividend policy of focusing on an increased nominal cash dividend year on year and utilizing share buybacks as a flexibility tool to optimize the capital position. Ending the year with a capital ratio of 19.4%, also provides a solid foundation to also meet regulatory headwinds, as well as absorb the capital effect from the Carnegie acquisition, but also continues to deliver on our dividend policy in the years to come. And with that, we would like to open up for questions.