Dnb Asa Sp/Adr

Good morning everyone and welcome. Welcome to everyone also watching us on the stream. This will be the presentation of our third quarter results in D&B Group, and we are looking forward to present the results for you. Kerstin and Ida will go into the details shortly. The emergency exits are in the front to your left and in the back, but there are no planned drills today, so if there is a fire alarm, it's for real. So there will be questions later, both here in the audience and possible to ask questions for those watching on the stream. And I'll just leave the floor to you, Kerstin, to get on with it.

Thank you very much, Even, and a very good morning to all of you and a warm welcome to this presentation of our third quarter results. We are presenting a strong set of numbers reflecting the summer season where a couple of months are slower for parts of the activity of our business but overall a steep and increasing activity towards the end of the quarter. The Norwegian economy continues to do well and this is well reflected both in the customer activity across our business but also in the robustness of our portfolio. I wanted to start by sharing a few highlights from the quarter. The first one actually after the quarter because only a few days into the fourth quarter the transaction related to listing Verishore on the Stockholm Stock Exchange closed. We had the honor of being global joint leader It was the largest listing in Stockholm in more than 25 years, the largest listing in Europe since 2022, and it marks the strengthened brand and platform we have with D&D Carnegie. Our assets under management continues to grow to a record level, 1,579 billion kroner, driven by market valuation and net inflow, and we continue to grow despite having sold Holberg in the quarter. One of the key drivers is successfully launching new products. We have launched four new products so far this year and this has driven 5 billion kroner of net inflow. Making life easier and simpler for our customers is something that we always strive for. And this quarter we have launched several new initiatives, one of them a fully digital process not only to register your company but also onboard your company in the bank. And each of these processes saving our customers 18 days in the process. By using, amongst other artificial intelligence, we are also simplifying the customer journey across services and across our platforms and this has, within the last year, led to an 18% reduction in number of service inquiries by our customers. And as usual, I do think it's appropriate for me to give a big shout out to the organization that works so hard every day to deliver on our mission to make life easier and the economy better for our customers at large. Now maybe over more to the numbers. Return on equity for the quarter at 15.8%, which is well above our targeted return of minimum 14%. The net interest income in the quarter is down by 1% compared to the previous quarter. This number is positively impacted by growth both on the lending side and the deposit side and offset by repricings that have been done and taken effect during the quarter as well as product mix effects. Net commission and fees a strong 28.9% increase from the corresponding quarter last year. Key engines or drivers if you will are investment banking and asset management. In investment banking we see high activity across ECM, DCM and a somewhat lower contribution from M&A this quarter. Asset management already referred to record numbers and attractive both market valuations and net inflow into the business. Another area that stands out very positively this quarter are our activities on the insurance side, both in the life insurance and the non-life insurance. Costs are down, reflecting our continuous efforts to increase efficiency and scale. We have a robust and well diversified portfolio across industries and geographies. We do take impairments of 862 million this quarter, but it is important to highlight that impairments on the underlying activity is 431 million, which corresponds to a cost of risk of eight basis points. Core Equity Tier 1, 17.935 basis points headroom to the FSA expected level and this number also reflects a deduction of 40 basis points related to the additional 1% share buyback that was announced earlier today. Earnings per share up 2.8% from previous quarter. Year-to-date a total of 6.98. A year-to-date 20.81. A few comments on the Norwegian economy. New data and economic update has shown that growth was higher than thought actually in the first half of the year. So the growth estimates for the year has been updated and is now believed to come in at around 1.8%. A very healthy level of growth and it's expected to stay roughly at this level for the coming years. Unemployment remains low and the regional business survey that is published by the central bank supports both the growth outlook and the unemployment with a very positive result. Inflation continues to move down. With lower inflation, high wage growth, we see drivers for increased consumer spending, which is an important driver for further economic growth. The central bank decided to cut rates for a second time in September this year. Ahead in the forecasting period, the expectations of DNB Carnegie is for one more rate cut to take place and that to take place in June next year, taking the key policy rate level to 3.75 and thereafter stay at that level for the remainder of the forecasting period. Needless to remind you, the world is an uncertain place these days with geopolitical tension around us. More importantly, the robustness and the resilience in the Norwegian economy continues to be very visible, and this is what matters the most for our business. A few highlights from the main business areas. An additional strong quarter from personal customers. 2.7% growth in lending year over year. And a quarter where there's been a high interest from customers in not only financing new homes but also looking for a new bank and many of them selecting and our S-Banken brand who have had the strongest growth in a quarter, in a month that they have seen for more than 15 years. Attractive revenue on other income, strong cost discipline and very low losses leads to attractive return on capital of 19.6% for personal customers. In Corporate Customers Norway volumes at the end of the quarter are relatively flat. They do increase if we look at the average volumes throughout the quarter and the underlying activity and growth across regions are positive with growing demand and growing volumes driven primarily by seafood and somewhat energy. There is a solid contribution from other income, in particular on the life insurance and defined contribution pension this quarter. Also here, cost discipline. Certain customer specific impairments have been taken, but even so, a return on allocated capital of above 20% for this part of our business. In large corporates, pre-tax profits is down compared to the previous quarter, and second quarter is usually a slower quarter, in particular in other income, where we are comparing to a record high quarter, third quarter 2024, which was also impacted by positive market to market effects. Volumes are up by half a percentage points. Underlying activity is, however, stronger in the business. There's also been a high activity in refinancing typical transactions related to bridge to bonds, which indicates a strong activity related to new business to get to the half percentage points growth. Year over year, growth on lending here is 10.2%. A solid contribution from other income, certainly on ECM again and DCM, but also here we see the lower contribution from M&A. Wealth management revenue in this area continues to grow. In the Nordics, we are building on our strengthened growth platform. If we take DNB Carnegie and look at the rolling 12-month revenue, it's up by 12.3% compared to last year. This is driven, of course, by the Carnegie acquisition, but also high activity on the ECM and DCM side. Equity capital markets are open. We do see an increasing number of RFPs and mandates coming in and we are expecting to see more of the business materializing after having been pushed out in time after the trade turmoil earlier this year. Wealth management, again, we see a revenue compared to last year that is up by 26.8%. A key driver, obviously, market valuation, but also very attractive flows into the business. And of course, the acquisition of Carnegie with Carnegie Fonder and private banking in Sweden that broadens our platform. Because I would like to highlight that even more importantly than this quarter is the strengthened growth platform that we have across these two business areas. The position stands out very strongly with a clear leading position as the Nordic Investment Bank. We have been a leader in three of the four largest IPOs in Europe so far this year. Asa Sp Asa Sp Asa Sp Asa Sp Asa Sp And then it's time for me for the last time to welcome my co-pilot for several years onto the stage for the last time. And it is also more than appropriate for me on behalf of DNB to thank Ida for her service and commitment to Asa Sp-Adr Asa Sp-Adr Asa Sp-Adr Asa Sp-Adr Asa Sp-Adr

Thank you, Kerstin, and thank you to the entire team for allowing me to be here for 18 years. It has definitely been the best 18 years of my life so far, so thank you all. Now moving over to the third quarter. We note good activity across the group with currency adjusted profitable loan growth of 0.3%. We continue to see a good momentum in the personal customer segment, where the lending volumes were up 0.4%, and as Kerstin pointed to, with an uptick of growth towards the end of the quarter. Corporate customer Norway were stable in terms of lending volumes, But this segment is of course also impacted by the fact that there's continues to be low activity in the construction of new houses, which is usually a strong engine for growth in the corporate customer area. Large corporate and international are up 0.5%. This does however not fully reflect the underlying development in the portfolio where we're seeing several larger bridge to bond transactions being taken out in the quarter and good momentum in terms of new businesses. Currency adjusted deposits were up 0.6%. The decrease of 1.8% in the personal customer segment are driven by seasonality. The reduction is, however, lower than what is usual for a third quarter and should also be seen in connection with this good increase we're seeing in asset under management from the retail customers. Corporate customers are down 3.9%. This is driven by a seasonal effect related to the public sector, where there is no monthly contribution from the state to the municipalities in August, but it is so for the remaining months of the year. The underlying deposit growth in corporate customer Norway is actually up 2%, which is of course a positive testament to the momentum in the overall society. Large corporate and international saw an increase by 8.5%, predominantly driven by the fact that there was only one petroleum tax payment in the quarter. We continue to maintain a strong deposit to loan ratio within the customer segments of 73.6% in the quarter. Net interest margins were affected by interest on equity and other NII and is down by five basis points. Combined spreads are stable. The underlying development in combined spreads are somewhat weaker than what can be seen here related to product mix effects and continued strong but rational competition in the market. For instance, large corporates we noted a high margin bridge bonds as mentioned before being replaced by lower margin loans. in the corporate customer area. We also saw decrease in low margin deposits stemming from the public sector being replaced by larger higher margin deposits from the SMB segment. Net interest income decreased by 162 million in the quarter. Volume growth and FX effects increased NII by 142 million and one additional interest they contributed positively by 129 million. Spreads are affected by the rate cut, product mix effects as mentioned before and continued strong but rational competition in the market. Interest on equity is down by 202 million, affected by changes in the money market rates and lower average equity following the dividend payment made in May as well as the concluded share buyback program. In the fourth quarter, we will see full effects from the first repricing being implemented 25th of August as well as partial effects of the second repricing being implemented mid-November. We continue to benefit from a robust and well-diversified fee platform. Customer activity picked up throughout the quarter, and in addition to what you can see on this slide, we are also noting positive momentum from the d&b life insurance business, as well as the non-life insurance company Framtind, as you can see on Other Income. Net commission and fees on this slide is up 878 million, or 28.9%, from an all-time high third quarter last year. Real estate broking was up 9%, reflecting the higher activity in the real estate market. Investment Banking Services was up by 73%, driven by the inclusion of Carnegie and strong deliveries within equity capital markets and growing so also from debt capital markets. In M&A, as Kerstin mentioned, activity was lower than what was noted in the similar quarter last year, In investment banking, we note a solid pipeline within equity capital markets as well as debt capital markets, where several transactions already have been completed in the fourth quarter and more mandates are expected to come. Asset management and custodial services was up 67%. There was a continued growth in asset under management in the quarter, net up 15 billion when adjusted for the sale of the Holberg divestment. Underlying asset under management was up 54 million in the quarter, and we noted positive net inflow from both personal customers, the retail segment, as well as institutional customers. And we continue to see a positive development in terms of number of long-term savings schemes. Guarantee commissions were down by 6% driven by lower demand for trade finance. Money transfer and banking services were down by 19%. The positive contribution that we're seeing from the seasonally higher transaction and international travel activity was offset by costs and reduced contribution from banking services. Banking services was among other things impacted by fewer cars being sold from d&b finance and also insurance premium costs related to exposures in large corporate and international. The latter is a tool used for capital efficiency, increased originate and distribute and also generates overall profitability to the group. Sale of insurance products was up by 21%, supported by continued good income from defined contribution in our life insurance business and positive development also in the non-life insurance business. Moving on to costs, where operating expenses are down by 242 million, reflecting seasonally lower activity. Fixed salaries are down by 126 million quarter on quarter. 45 of these are related to seasonal effects in our Swedish operation, where the vacation days are deducted from previously accrued costs. The rest relates to fewer full-time employees in the group. This quarter also includes one-off costs amounting to 55 million. of which 25 million relates to the announced decrease in number of full-time employees in our operations area, and 30 to the integration of Carnegie. Over to portfolio quality, which remains robust and is well diversified, with 99.4% being in stage 1 and 2. We note impairment provisions totaling 862 million in the quarter. 150 of these relates to an update of our expected credit loss model. This impacts impairment provision in stage one and two in the personal customer segment as well as in the corporate customer segment. In addition to that, we have taken 281 of further impairments related to our legacy portfolio in Poland. Impairment provision, as Kerstin mentioned, in the underlying portfolio amounts to 431 million, equivalent to cost or risk of 8 basis points. The overall portfolio in the personal customer segment as well as in the corporate customer segments are strong with no signs of deteriorated quality. In the personal customer segments there are fewer customers with installment holidays and defaulted loans today than what we saw a year ago. In the corporate customer segments we have fewer customers on watchlist and we continue to see a good momentum. The impairment provisions in Stage 3 for Corporate Customer Norway relate to customer specific situations in the same sectors as we pointed to before, namely real estate related. The overall portfolio quality here continues to be sound and robust, with a limited portion of the exposure in high risk. We remain comfortable with our credit quality in the overall portfolio. And now moving on to capital. The core equity tier one capital is strong at 17.9%, having 35 basis points above the regulatory expectation. The core equity tier one was positively impacted by profitability, 30 basis points, which was offset by the increased risk weight floors in the residential mortgage portfolio, leading to a reduction as announced previously of 60 basis points. We finalized the previous share buyback program during the quarter and are today announcing a new 1% share buyback program impacting the core equity tier 1 by 40 basis points this quarter. Leverage ratio remains strong at 6.3%, well above the regulatory requirement of 3%. With a core equity tier 1 of 17.9% and a leverage ratio of 6.3%, Our capital position remains strong and enables us to continue to deliver on our dividend policy. So summing up, we deliver a strong set of results in the third quarter reflected in these key numbers. Return on equity came in at 15.8%, earnings per share at 6.98, 2.8% increase from the last quarter, cost income at 37.4%. And with that, I thank you for your attention and we now open up for Q&A.