DNB Bank (OTCPK:DNBB.Y) Update / Briefing Transcript

DNB Bank (OTCPK:DNBB.Y) Update Summary Company Overview - Company: DNB Bank - Date of Briefing: January 07, 2026 Key Points Financial Performance - Corporate Growth: Reported at 1.8% for the fourth quarter [1] - Net Interest Income (NII): Expected to be negatively impacted by regulatory changes related to tax accounts in Norway, with an anticipated annual NII impact of approximately 300 million NOK [2] - Technical Correction: A one-off technical correction of approximately negative 80 million NOK in other NII is expected in Q4 [2] Monetary Policy and Interest Rates - Policy Rate Changes: The central bank cut the key policy rate by 25 basis points twice, first from 450 to 425 in June and then again in September [1][2] - Future Expectations: DNB Carnegie anticipates one additional 25 basis points cut to the key policy rate in June, reaching a terminal level of 3.75% [2] Capital and Ratios - CT1 Ratio: Reported at 17.9%, exceeding the NFSA's expected level of 16.6% [3] - FX Sensitivity: A 10% change in FX results in approximately a 20 basis points change in the CT1 ratio [3] - Pillar 2 Guidance: Reduced by 25 basis points from 1.25% to 1% effective December 31, 2025 [3] Operational Risk and Costs - Operational Risk REA Volume: Expected to increase due to higher income over the last years, with adjustments made annually [4] - Non-Recurring Costs: Anticipated integration costs related to Carnegie of NOK 250 million for the full year 2025, with NOK 200 million incurred year to date [6] - Salary Inflation: Expected to be 4.8% for the year 2025 [6] Asset Quality - Monitoring: The asset quality remains stable, with no systemic areas of concern identified in the portfolio [7][8] - Impairments: Expected to vary based on macroeconomic factors and company-specific events [7] Market Activity - Net Commission and Fees: Higher activity levels typically observed in Q4 compared to Q3, positively impacting fee levels [5] - Financial Instruments: Seasonally higher activity in DNB Carnegie's FICC, with positive mark-to-market effects reported [5] Miscellaneous - Pension Expenses: Normalized pension expenses expected to be approximately 500 million NOK per quarter [7] - Consensus Estimates: Reminder for submission of consensus estimates by January 9, 2026 [8]