DNB Bank ASA

Earnings Release • Apr 23, 2024

Results DNB Group

First quarter 2024

Kjerstin R. Braathen (CEO)

Continued strong performance and solid asset quality

Return on equity (ROE) of 15.6 per cent in the quarter Solid results across customer segments and product areas.

Net interest income (NII) down 2.9 per cent from 4Q23 Driven by lower credit growth, product-mix effects and fewer interest days.

Net commissions and fees (NCF) up 2.6 per cent from 1Q23 All-time high first quarter results. Assets under management surpassed NOK 1 000 billion during 1Q24.

Robust asset quality and low impairment provisions 99.3 per cent in stages 1 and 2. Impairment provisions of NOK 323 million in the quarter.

19.0 Earnings per share (EPS) up 9.3 per cent from 4Q23 EPS of NOK 6.48 in the quarter (NOK 5.93 in 4Q23).

Norwegian economy remains robust, and first key policy rate cut pushed out in time

• Moderate growth in mainland economy forecast in short term, followed by accelerating growth from 2025
• Continued easing of inflationary pressure
• Key policy rate expected to remain at 4.50 per cent until December 2024, then gradually decrease to 3.25 per cent by year-end 2025

Sources: Statistics Norway, DNB Markets, Norges Bank (Norwegian central bank).

Improved purchasing power sets stage for rise in consumer spending

• Resilient activity level supports low unemployment levels going forward
• Real wage growth for households expected to boost purchasing power
• Growth anticipated in residential property prices in the ensuing period, due to improved purchasing power and limited supply of newbuilds

Personal customers – solid results

Pre-tax operating profit

Highlights of the quarter

• Loans and deposits down from end-2023 by 1.4 and 0.9 per cent, respectively
• Activity level in residential real estate market picked up during the quarter
• Norwegian households remain robust and resilient increased travel activity
• Strong underlying growth in new savings schemes 8.7 per cent growth YoY

Solid development in savings

Savings volumes at end of period, NOK billion

Corporate customers – high activity level and strong performance

6

Volumes affected by lower credit growth

• Total loan volume up 0.7 per cent up 2.8 per cent in Corporate customers and down 1.4 per cent in Personal customers
• Total deposit volume up 3.9 per cent up 7.2 per cent in Corporate customers and down 0.9 per cent in Personal customers

Net interest margin remains strong

1 Total net interest income relative to average loans and deposits in the customer segments.

Net interest income down 2.9 per cent

• Increased competition, product-mix effects and fewer interest days affected the result this quarter
• Lending growth in Corporate customers picked up late in the quarter
• Full effect of repricings implemented end-October and end-November 2023, partial effect of repricing implemented end-February 2024

Commissions and fees – all-time high first quarter result

1 DCM: Debt capital markets.

2 AUM: Assets under management.

Operating expenses reflect seasonally lower activity level

1 The pension scheme is partly hedged and recognised in net gains on financial instruments.

Robust and well-diversified portfolio – 99.3 per cent in stages 1 and 2

• Personal customer portfolio continued strong credit quality
• Corporate customer portfolio stage 3 impairment provisions relating to customer-specific events in both large corporates and small and mediumsized enterprises

Impairment of financial instruments by industry segment NOK million
	1Q24	4Q23	1Q23
Total	(323)	(920)	79
Of which:
Personal customers
- Stages 1 and 2	(43)	16	11
- Stage 3	(68)	(132)	(81)
Corporate customers
- Stage 1 and 2	(32)	(118)	(87)
- Stage 3	(180)	(685)	236

Strong capital position

• CET1 capital ratio increased by 78 basis points to 19.0 per cent, ~210 basis point headroom to Financial Supervisory Authority's (FSA's) expectation
  • ‒ Profit generation and ordinary dividends from DNB Livsforsikring increased CET1 capital ratio by 31 and 8 basis points, respectively
  • ‒ Portfolio growth and currency effects in the quarter offset by positive migration
• Board of Directors will apply for approval from Annual General Meeting to repurchase up to 3.5 per cent of company's share capital

1 The FSA's current expectation: 16.8 per cent.

2 The FSA's current requirement: 15.6 per cent.

Strong first quarter result

Return on equity Per cent				Earnings per share NOK			Cost/income ratio Per cent
17.2	14.6	15.6	6.59	5.93	6.48		34.0	38.5	35.7
1Q23	4Q23	1Q24	1Q23	4Q23	1Q24		1Q23	4Q23	1Q24

14

Appendix

Income statement

				Change	Change
million NOK	1Q24	4Q23	1Q23	from 4Q23	from 1Q23
Net interest income	15 526	15 997	14 600	(471)	927
Other operating income	872 4	3 991	936 5	880	(1 065)
Total income	20 398	19 988	20 536	409	(138)
Operating expenses	(7 284)	(7 703)	(6 976)	418	(308)
profit before operating impairment Pre-tax	13 113	12 286	13 560	828	(446)
Impairment of loans and and gains guarantees assets on	(324)	(920)	79	596	(404)
profit Pre-tax operating	12 789	11 366	13 639	1 423	(850)
Tax expense	(2 558)	(1 824)	(3 137)	(734)	579
Profit from operations held for sale after taxes ,	(29)	(138)	(30)	110	1
Profit for the period	10 203	9 403	10 472	799	(270)
Portion attributable shareholders to	9 789	019 9	10 192	771	(403)

Other operating income

				Change	Change
million NOK	1Q24	4Q23	1Q23	from 4Q23	from 1Q23
fees Net commissions and	2 702	2 927	2 634	(225)	6 8
in Markets Customer DNB revenues	715	816	781	(101)	(66)
Trading Markets in DNB revenues	227	222	324	5	(97)
of defined benefit Hedging pension scheme -	99	82	62	17	37
Credit spreads bonds on	87	(16)	72	103	15
Credit spreads fixed loans -rate on	54	22	(235)	32	289
CVA/DVA/FVA	42	(137)	78	179	(35)
Other mark -to-market adjustments	(344)	(260)	859	(84)	(1 203)
Basis swaps	(240)	(500)	(4)	260	(236)
Exchange effects additional Tier 1 capital rate on	543	(392)	527	935	17
gains financial instruments fair value Net at on	1 183	(162)	2 464	1 345	(1 280)
life insurance result Net	203	326	154	(123)	9 4
Profit from investments accounted for by the equity method	188	274	164	(86)	2 4
Other	595	626	520	(31)	7 5
other operating income total Net ,	872 4	3 991	936 5	881	(1 064)

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

The statements contained in this presentation may include forward-looking statements, such as statements of future expectations. These statements are based on the management's current views and assumptions and involve both known and unknown risks and uncertainties.

Although DNB believes that the expectations implied in any such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to be correct.

Actual results, performance or events may differ materially from those set out or implied in the forward-looking statements. Important factors that may cause such a difference include, but are not limited to: (i) general economic conditions, (ii) performance of financial markets, including market volatility and liquidity, (iii) the extent of credit defaults, (iv) interest rate levels, (v) currency exchange rates, (vi) changes in the competitive climate, (vii) changes in laws and regulations, (viii) changes in the policies of central banks and/or foreign governments, or supranational entities.

DNB assumes no obligation to update any forward-looking statement.

This presentation contains alternative performance measures, or non-IFRS financial measures. Definitions and calculations are presented on ir.dnb.no.