- Half-yearly report for the first half of 2014

(Tall i parentes gjelder tilsvarende periode i 2010) (Result figures for the corresponding period in 2013 are shown in brackets. Balance sheet figures in parentheses are for the end of 2013.)

Resultat før skatt på 45 millioner kroner hittil i år • Profit before taxes of NOK 48 million in Q2 and NOK 110 million in the first half of the year.
Utlånsvolum utgjør 16,6 milliarder kroner ved • Good portfolio quality
årsskiftet • Utstedt obligasjon med fortrinnsrett på 500 millioner • Lending volume unchanged

Financial performance

Profit before taxes in Q2 was NOK 48 million (NOK 61 million) and NOK 110 million (NOK 106 million) for the first half of the year. This performance is in line with general market trends.

Net interest income for Q2 amounted to NOK 62 million (NOK 67 million) and NOK 127 million (NOK 121 million) for the first half of the year. Lending margins increased in the first half of the year in line with market developments. As a percentage of average total assets, net interest income was 1.57 per cent (1.46 per cent) for Q2 and 1.65 per cent (1.33 per cent) for the first half of the year.

Other operating income in Q2 amounted to minus NOK 10 million (minus NOK 1 million) and minus NOK 10 million (minus NOK 5 million) for the first half of the year, resulting primarily from realised losses on financial instruments.

Operating costs are stable.

Losses in the portfolio are low, and in Q2 the company recognised NOK 0.0 million (minus NOK 0.3 million) against loan losses, and NOK 0.2 million (minus NOK 1.7 million) in the first half of the year.

Balance sheet performance

Total lending was almost unchanged in first half of the year compared with the end of 2013, and amounts to NOK 14.9 billion (NOK 14.8 billion). Storebrand Bank and Storebrand Boligkreditt operate with conservative lending practices. The average loan-to-value ratio in the portfolio is 49 per cent, against 48 per cent at the end of 2013. On the date of transfer, the loan-to-value ratio never exceeds 75 per cent. The risk in the loan portfolio is considered to be very low. The company has over-collateralisation of 139 per cent (127 per cent).

Defaulted loans at the end of the first half of the year amounted to NOK 29 million (NOK 39 million), equivalent to 0.19 per cent of gross loans in the company (0.26 per cent). All the loans have a loan-to-value ratio within 70 per cent of market value or are fully written down. Individual loan write-downs amount to NOK 2 million at the end of the first half of the year (2 million). At the end of the first half of the year, group write-downs amount to NOK 1 million (NOK 1 million).

The company's total assets under management at the end of the first half of the year were NOK 15.6 billion compared with NOK 15.5 billion at the end of 2013.

At the end of the first half of the year, the company had issued covered bonds worth NOK 11.0 billion, with remaining terms of about 11 months to 4 years. NOK 7.9 billion of these bonds have been placed in the market, while the remaining NOK 3.1 billion are being held in the parent bank.

Storebrand Boligkreditt has credit facility agreements with Storebrand Bank ASA for the day-to-day operations of the company including the purchase of loans from Storebrand Bank, and to cover interest and repayment on covered bonds for the next 12 months at any given time.

Equity in the company at the end of the first half of the year amounted to NOK 959 million. The net capital base at the end of the first half of the year, following the group contributions, amounted to NOK 879 million (NOK 879 million). The company's capital adequacy and core capital adequacy are 14.6 per cent (14.7 per cent). Storebrand Boligkreditt aims to comply with the applicable buffer capital requirements at all times. Storebrand Boligkreditt has satisfactory solvency and liquidity based on the company's business activities.

In 2014 Storebrand Boligkreditt will continue its core activity which is the acquisition and management of home mortgages from Storebrand Bank. The company is aiming for moderate growth in collateralisation during 2014.

The company is working systemically to adapt to the new statutory capital and capital buffer requirements in Norway.

The housing market and developments in total nonperforming loans will be closely monitored. Efforts to ensure good working procedures and high data quality will continue and thereby ensure that government and rating requirements continue to be fulfilled. Developments in the Norwegian and international capital markets, interest rates, unemployment and the property market are regarded as the key risk factors that can affect the results of Storebrand Boligkreditt in 2014.

New issues of covered bonds will be made available when the company decides it is prudent to do so and there is sufficient security. Storebrand Boligkreditt will continue to contribute to Storebrand Bank having diversified financing.

No events of material importance to the interim financial statements have occured since the balance sheet date.

PROFIT AND LOSS ACCOUNT

		Q2		01.01 - 30.06		FULL YEAR
NOK MILLION	NOTE	2014	2013	2014	2013	2013
Interest income	4, 13	144.3	172.0	288.3	333.9	645.6
Interest expense	4, 13	-82.7	-105.5	-161.6	-212.9	-390.0
Net interest income	13	61.6	66.5	126.8	121.0	255.6

Commission income		0.0	0.0	0.0	0.0	0.1
Commission expense		0.0	0.0	0.0	0.0	0.0
Net commission income		0.0	0.0	0.0	0.0	0.1


Net gains on financial instruments		-9.5	-1.3	-9.5	-4.8	-5.5
Total other operating income		-9.5	-1.3	-9.5	-4.8	-5.5

Staff expenses		-0.1	0.0	-0.1	-0.1	-0.1
General administration expenses		-0.4	0.0	-0.4	-0.1	-0.1
Other operating costs	4	-3.7	-4.0	-7.4	-8.0	-15.9
Total operating costs		-4.2	-4.0	-7.9	-8.1	-16.1

Operating profit before loan losses		48.0	61.2	109.4	108.1	234.1

Loan losses for the period	15	0.0	-0.3	0.2	-1.7	-2.0
Profit before tax		48.0	60.9	109.6	106.4	232.0

Tax	3	-13.0	-17.1	-29.6	-29.8	-64.8
Profit for the year		35.0	43.9	80.0	76.6	167.2

STATEMENT OF COMPREHENSIVE INCOME

	Q2		01.01 - 30.06		FULL YEAR
NOK MILLION	2014	2013	2014	2013	2013

Profit for the period	35.0	43.9	80.0	76.6	167.2
Other comprehensive income	0.0	0.0	0.0	0.0	0.0
Total comprehensive income for the period	35.0	43.9	80.0	76.6	167.2

STATEMENT OF FINANCIAL POSITION

NOK MILLION	NOTE	30.06.2014	30.06.2013	31.12.2013

Loans to and deposits with credit institutions	6	509.8	418.2	403.7
Financial assets designated at fair value through profit and loss:
Derivatives	6	218.7	260.3	247.7

Other current assets	4	44.9	67.0	28.4

Gross lending	11	14 867.9	16 895.7	14 808.9
- Loan loss provisions on individual loans	15	-1.9	-2.6	-2.4
- Loan loss provisions on groups of loans	15	-1.0	-1.6	-0.7
Net lending to customers	6	14 865.0	16 891.5	14 805.9

Total assets		15 638.4	17 637.0	15 485.6

Liabilities to credit institutions	4, 6, 8	3 408.9	4 411.8	2 148.5

Other financial liabilities:
Commercial papers and bonds issued	6, 9	11 237.0	12 232.4	12 219.0
Other liabilities	4	29.7	0.3	66.0

Deferred tax		3.9	34.8	3.9
Total liabilities		14 679.5	16 679.3	14 437.3

Paid in equity		844.0	844.0	844.0
Other equity		114.8	113.7	204.3
Total equity	10	958.8	957.8	1 048.3

Total liabilities and equity		15 638.4	17 637.0	15 485.6

Lysaker, 15 July 2014 The Board of Directors of Storebrand Boligkreditt AS

RECONCILIATION OF EQUITY

	PAID IN CAPITAL				OTHER EQUITY
NOK MILLION	SHARE CAPITAL	SHARE PREMIUM RESERVE	OTHER PAID IN EQUITY	TOTAL PAID IN EQUITY	REVENUE & COSTS APPLIED TO EQUITY	OTHER EQUITY	TOTAL OTHER EQUITY	TOTAL EQUITY
Equity at 31.12.2012	350.0	200.1	118.9	669.0	0.0	122.4	122.4	791.4
Profit for the period						167.2	167.2	167.2
Other comprehensive income								0.0
Total comprehensive income for the period	0.0	0.0	0.0	0.0	0.0	167.2	167.2	167.2

Equity transactions with the owner:
Capital increase	105.0	70.0		175.0				175.0
Group contribution paid						-85.3	-85.3	-85.3
Equity at 31.12.2013	455.0	270.1	118.9	844.0	0.0	204.3	204.3	1 048.3

Profit for the period						80.0	80.0	80.0
Other comprehensive income								0.0
Total comprehensive income for the period	0.0	0.0	0.0	0.0	0.0	80.0	80.0	80.0

Equity transactions with the owner:
Group contribution paid						-169.5	-169.5	-169.5
Equity at 30.06.2014	455.0	270.1	118.9	844.0	0.0	114.8	114.8	958.8

Equity at 31.12.2012	350.0	200.1	118.9	669.0	0.0	122.4	122.4	791.4
Profit for the period						76.6	76.6	76.6
Other comprehensive income								0.0
Total comprehensive income for the period	0.0	0.0	0.0	0.0	0.0	76.6	76.6	76.6

Equity transactions with the owner:
Capital increase not registered in the Register of Enterprise Businesses			175.0	175.0				175.0
Group contribution paid						-85.3	-85.3	-85.3
Equity at 30.06.2013	350.0	200.1	293.9	844.0	0.0	113.7	113.7	957.8

Storebrand Boligkreditt AS is 100 per cent owned by Storebrand Bank ASA. Number of shares are 35.000.000 of nominal value NOK 13 per share.

CASH FLOW STATEMENT

NOK MILLION	30.06.2014	30.06.2013
Cash flow from operations
Net receipts/payments of interest, commissions and fees from customers	290.7	332.4
Net disbursements/payments on customer loans	-77.7	356.2
Net receipts/payments on securities	-9.5	-4.8
Payments of operating costs	-8.0	-8.2
Net cash flow from operating activities	195.5	675.6

Cash flow from financing activities
Payments - repayments of loans and issuing of bond debt	-942.7	-505.8
Receipts - new loans and issuing of bond debt	1 260.5
Payments - interest on loans	-171.8	-216.3
Receipts - issuing of share capital and other equity		175.0
Payments - group contribution	-235.4	-118.5
Net cash flow from financing activities	-89.4	-665.7
Net cash flow in the period	106.1	9.9
Cash and bank deposits at the start of the period	403.7	408.3
Cash and bank deposits at the end of the period	509.8	418.2

Storebrand Boligkreditt has credit facility agreements with Storebrand Bank ASA

The amount drawn on the credit facilities is recognized in the line item "Liabilities to credit institutions" as at 30.06.2014. See also Note 8.

NOTE 1 ACCOUNTING PRINCIPLES

The financial statements are prepared in accordance with IAS 34 Interim Financial Reporting. The interim financial statements do not include all the information required in the annual report. The financial statements of Storebrand Boligkreditt AS have been prepared in accordance with International Financial Reporting Standards (IFRS) approved by the EU and appurtenant interpretations.

A description of the accounting policies applied in the preparation of the financial statements is provided in the 2013 annual report, and the interim financial statements are prepared with respect to these accounting policies. There have been amendments to the IFRS regulations with effects from, or that can voluntary be applied from 1 January 2014. These changes have not caused significant effects on Storebrand Boligkreditt's interim financial statements.

NOTE 2 ESTIMATES

Critical accounting estimates and judgements made for the 2013 annual financial statements are described in note 2 and valuation of financial instruments at fair value is described in note 8. In preparing financial statements the management are required to make judgements, estimates and assumptions of uncertain amounts. The estimates and underlying assumptions are reviewed on an ongoing basis and are based on historical experience and expectations of future events and represent the management's best judgment at the time the financial statements were prepared.

Actual results may differ from these estimates.

NOTE 3 TAX

The tax expenses during the first half of the year have been estimated based upon an expected effective tax rate on 27 per cent for the year of 2014. There will be uncertainty associated with these estimates.

NOTE 4 RELATED PARTIES

Issued coverede bonds

Storebrand Bank ASA has invested a total of NOK 3.1 billion in covered bonds issued by Storebrand Boligkreditt AS as of 30 June 2014.

Loans transferred from Storebrand Bank ASA

Storebrand Bank ASA sells loans to the mortgage company Storebrand Boligkreditt AS. The mortgages are transferred on commercial terms. Once the loans are transferred, Storebrand Boligkreditt AS assumes all the risks and benefits of owning the loan portfolio. It is Storebrand Boligkreditt that receives all the cash flows from the loan customer. Storebrand Bank ASA shall arrange the transfer and return of loans when changes have to be made, i.e. if there is a request to increase the loan amount, change from variable to fixed interest, conversion to empoloyee loan or conversion to a flexible mortgage. The costs are included in the contractual administration fee. Non-performing loans in Storebrand Boligkreditt AS remain in the company. These loans will, pursuant to the service agreement with Storebrand Bank ASA, be treated in the same way as non-performing loans in the bank. Specific reports are prepared for non-performing loans in Storebrand Boligkreditt AS. These loans are not included in the cover pool. Loans to employees can be transferred to Storebrand Boligkreditt AS. The difference between the market interest rate and the subsidised interest rate is covered monthly by the company in which the debtor is employed.

Storebrand Bank ASA has not pledged any guarantees in connection with loans to Storebrand Boligkreditt AS.

Credit facilites with Storebrand Bank ASA

Storebrand Boligkreditt AS has two credit facilities with Storebrand Bank ASA. See note 8 for more information.

Other

Storebrand Boligkreditt AS has no employees, and purchases personnel resources from Storebrand Bank ASA and services including accounting functions from Storebrand Livsforsikring AS. Storebrand Boligkreditt AS conducts transactions with close associates as part of its normal business activities. These transactions take place on commercial terms. The terms for transactions with senior employees and related parties are stipulated in note 28 in the 2013 annual report for Storebrand Boligkreditt AS.

NOTE 5 FINANCIAL RISK

Financial risk is described in the 2013 annual report in note 6 (Financial market risk), note 5 (Liquidity risk), note 4 (Credit risk) and note 7 (Operational risk) which also are representative of the financial risks as per 30 June 2014. Conditions that are of signification to the financial risk are also described in note 2 (Important accounting estimates and judgements).

NOTE 6 VALUATION OF FINANCIAL INSTRUMENTS

Storebrand Boligkreditt AS conducts a comprehensive process to ensure that financial instruments are valued as closely as possible to their market value.

Unlisted derivatives, including primarily interest rate and foreign exchange instruments, are also valued theoretically. Money market rates, swap rates, exchange rates and volatilities that form the basis for valuations are supplied by Reuters, Bloomberg and Norges Bank.

Storebrand Boligkreditt AS carries out continual checks to safeguard the quality of market data that has been collected from external sources. These types of checks will generally involve comparing multiple sources as well as controlling and assessing the likelihood of unusual changes.

The company categorises financial instruments on three different levels, for further information see note 8 in the 2013 annual report. The levels express the differing degrees of liquidity and different measurement methods used. The company has established valuation models to gather information from a wide range of well-informed sources with reference to minimising the uncertainty of valuations.

Valuation of financial instruments at amortised cost

NOK MILLION	FAIR VALUE 30.06.2014	FAIR VALUE 31.12.2013	BOOK VALUE 30.06.2014	BOOK VALUE 31.12.2013
Financial assets
Loans to and deposits with credit institutions	509.8	403.7	509.8	403.7
Lending to customers	14 865.0	14 805.9	14 865.0	14 805.9

Financial liabilities
Deposits from and due to credit institutions	3 408.9	2 148.5	3 408.9	2 148.5
Commercial papers and bonds issued	11 355.7	12 312.9	11 237.0	12 219.0

Valuation of financial instruments at fair value

	LEVEL 1	LEVEL 2 LEVEL 3
NOK MILLION	QUOTED PRICES	OBSERVABLE ASSUMPTIONS	NON-OBSERVABLE ASSUMPTIONS	BOOK VALUE 30.06.2014	BOOK VALUE 31.12.2013
Interest rate derivatives		218.7		218.7	247.7
Total derivatives	0.0	218.7	0.0	218.7	247.7
Derivatives with a positive fair value		218.7		218.7	247.7
Derivatives with a negative fair value
Total derivatives 31.12.2013		247.7

There have not been any changes between quoted prices and observable assumptions on the various financial instruments in the quarter.

NOTE 7 SEGMENT INFORMATION

Business segments are the company's primary reporting segments. The company has only one segment, Retail Lending. This segment comprises lending to private individuals, and all loans are purchased from Storebrand Bank ASA. The company's accounts for the first half of 2014 therefore relate entirely to the Retail Lending segment.

NOTE 8 LIABILITIES TO CREDIT INSTITUTIONS

The company has two credit facilities with Storebrand Bank ASA. The first agreement is used for general operations, such as the acquisition of home mortgages from Storebrand Bank. The second agreement may be used for repayment of interest and principal on covered bonds and related derivatives. At all times, the size of the available credit facility should cover the interest and repayment of covered bonds for the coming 12 months.

NOTE 9 COMMERCIAL PAPERS AND BONDS ISSUED

Covered bonds

Total commercial papers and bonds issued	11 237.0
NO0010660822	2 540.0	NOK	Floating	20.06.2018	2 567.0
NO0010635071	2 650.0	NOK	Floating	21.06.2017	2 664.6
NO0010612294	2 000.0	NOK	Floating	15.06.2016	1 998.5
NO0010575913	646.5	NOK	Floating	03.06.2016	647.7
NO0010638307	1 000.0	NOK	Floating	17.06.2015	1 000.7
NO0010548373	1 250.0	NOK	Fixed	28.10.2019	1 441.7
NO0010428584	883.0	NOK	Fixed	06.05.2015	916.8
ISIN CODE	NOMINAL VALUE	CURRENCY	INTEREST	MATURITY 1)	30.06.2014
NOK MILLION					BOOK VALUE

1) Maturity date in this summary is the first possible maturity date (Call date).

The loan agreements contain standard covenants. In 2014, Storebrand Boligkreditt AS met all terms and conditions with respect to the loan agreements. The company´s overcollateralisation requirement of 109,5 per cent is fulfilled and in accordance with the loan programme.

NOTE 10 CAPITAL ADEQUACY

Net primary capital

NOK MILLION	30.06.2014	31.12.2013
Share capital	455.0	455.0
Other equity	503.8	593.3
Total equity	958.8	1 048.3
Deductions
Provision for group contribution		-169.5
Profit not included in the calculation of net primary capital	-80.0
Core capital exc. Hybrid Tier 1 capital	878.9	878.9
Deductions
Core capital	878.9	878.9
Deductions
Net primary capital	878.9	878.9

Minimum capital requirement

NOK MILLION	30.06.2014	31.12.2013
Credit risk	457.9	454.5
Of which:
Institutions	12.3	10.9
Loans secured against real estate	432.0	431.0
Loans past-due	1.9	2.9
Other	11.6	9.9
Total minimum requirement for credit risk	457.9	454.7

Total minimum requirement for market risk	0.0	0.0
Operational risk 1)	22.8	22.8
Deductions
Loan loss provisions on groups of loans	-0.1	-0.1
Minimum requirement for net primary capital	480.7	477.5

NOTE 10 CAPITAL ADEQUACY (continued)

Capital adequacy

	30.06.2014	31.12.2013
Capital ratio	14.6 %	14.7 %
Core (tier 1) capital ratio	14.6 %	14.7 %
Core capital ratio excl. Hybrid Tier 1 capital	14.6 %	14.7 %

The standard method is used for credit risk and market risk, and the basic method for operational risk. New capital requirements came into force from 1 July 2013. The overall requirements for core tier 1 capital and the capital base are 9 and 12.5 per cent respectively as of 1 July 2013, and 10 and 13.5 per cent respectively as of 1 July 2014. The introduction of a counter-cyclical capital buffer of 1 per cent core tier 1 capital should be expected from 30 June 2015.

Basis of calculation (risk-weighted volume)

NOK MILLION	30.06.2014	31.12.2013
Credit risk	5 724.2	5 680.7
Of which:
Institutions	154.0	136.3
Loans secured against real estate	5 400.6	5 387.1
Loans past-due	24.3	35.7
Other	145.4	124.2
Total basis of calculation credit risk	5 724.2	5 683.4

Total basis of calculation market risk	0.0	0.0
Operational risk	285.5	285.5
Deductions
Loan loss provisions on groups of loans	-1.0	-0.7
Total basis of calculation of minimum requirements for capital base	6 008.7	5 968.2

NOTE 11 LOAN TO VALUE RATIOS AND COLLATERAL

NOK MILLION	30.06.2014	31.12.2013
Gross lending 1)	14 867.9	14 808.9
Average loan balance	1.5	1.5
No. of loans	9 650	9 861
Weighted average seasoning (months)	39	39
Weighted average remaning term (months)	206	202
Average loan to value ratio	49%	48%

Over-collateralisation 2)	138.9 %	126.3 %

Cover pool:
Residential mortgages 1)	14 793.3	14 715.0
Supplementary security	506.5	403.3
Total	15 299.8	15 118.3

1) In accordance with the Regulation for credit institutions that issue covered bonds, lending cannot exceed 75% of the value of collateral (i.e. value of properties pledged as collateral). As per 30 June 2014 the company had NOK 46,0 million that exceeds the loan to value limit and has therefore not been included in the cover pool. As per 30 June 2014, the company has 8 non-performing loans without evidence of impairment, equivalent to NOK 17.4 million. There are 10 non-performing loans with evidence of impairment of NOK 11.1 million where the impairment is assessed to be NOK 1.9 million. Non-performing loans with and without evidence of impairment, are not included in the cover pool.

2) Over-collateralisation has been calculated based on total volume of issued covered bonds of NOK 11.0 billion (nominal value).

NOTE 12 KEY FIGURES

	Q2		01.01 - 30.06		FULL YEAR
NOK MILLION	2014	2013	2014	2013	2013
Profit and Loss account: (as % of avg. total assets) 1)
Net interest income	1.59%	1.46%	1.65%	1.33%	1.48%

Main balance sheet figures:
Total assets			15 638.4	17 637.0	15 485.6
Average total assets	15 561.3	18 267.3	15 528.8	18 289.5	17 320.1
Gross lending to customers			14 867.9	16 895.7	14 808.9
Equity			958.8	957.8	1 048.3

Other key figures:
Loan losses and provisions as % of average total lending	0.00%	0.01%	0.00%	0.02%	0.01%
Individual loan loss provisions as % of gross
loss-exposed loans 3)			10.8 %	10.9 %	8.6 %
Cost/income ratio	8.0 %	6.2 %	6.7 %	6.9 %	6.4 %
Return on equity before tax 2)			22.2 %	26.7 %	25.8 %
Core (tier 1) capital ratio			14.6 %	13.3 %	14.7 %

Definitions:

1) Average total assets is calculated on the basis of monthly total assets for the year.

2) Annualised profit before tax adjusted for hedging ineffectiveness as % of average equity.

3) Gross loss-exposed loans with evidence of impairment.

NOTE 13 NET INTEREST INCOME

	Q2		01.01 - 30.06		FULL YEAR
NOK MILLION	2014	2013	2014	2013	2013
Interest and other income on loans to and deposits with credit institutions	2.4	0.0	4.3	2.8	10.2
Interest and other income on loans to and due from customers	141.9	172.1	284.0	331.1	635.5
Interest on short-term debt instruments, bonds and other interest bearing securities
Other interest income
Total interest income	144.3	172.0	288.3	333.9	645.6
Interest and other expenses on debt to credit institutions	-17.1	-32.6	-28.5	-66.1	-101.4
Interest and other expenses on deposits from and due to customers
Interest and other expenses on securities issued	-65.6	-72.9	-133.0	-146.8	-288.7
Interest and other expenses on subordinated loan capital
Other interest expenses
Total interest expenses	-82.7	-105.5	-161.6	-212.9	-390.0

Net interest income	61.6	66.5	126.8	121.0	255.6

NOTE 14 OFF BALANCE SHEET LIABILITIES AND CONTINGENT LIABILITIES

NOK MILLION	30.06.2014	31.12.2013
Undrawn credit limits	1 784.5	1 732.5
Total contingent liabilities	1 784.5	1 732.5

Undrawn credit limits relate to the unused portion of credit limits on flexible mortgage loans.

The company has not pledged nor received any collateral.

NOTE 15 NON-PERFORMING LOANS AND LOAN LOSSES

NOK MILLION	30.06.2014	31.12.2013
Non-performing loans
Non-performing loans without evidence of impairment	17.4	27.5
Loss-exposed loans with evidence of impairment	11.2	11.0
Gross non-performing and loss-exposed loans	28.6	38.5
Loan loss provisions on individual loans	-1.9	-2.4
Net non-performing and loss-exposed loans	26.7	36.1

Key figures
Net non-performing and loss-exposed loans as % of gross lending	0.19%	0.26%

Loans are regarded as non-performing and loss-exposed:

when a credit facility has been overdrawn for more than 90 days
when an ordinary mortgage has arrears older than 90 days
when a credit card has arrears older than 90 days and the credit limit has been overdrawn. If a repayment plan has been agreed with the customer and is being adhered to, the overdraft is not regarded as a non-performing loan. When one of the three situations described above occurs, loans and the rest of the customer's commitments are regarded as non-performing. The number of days is counted from when the arrears exceed NOK 2,000. The account is regarded as active when there are no longer any arrears. The amount in arrears at the time of reporting can be less than NOK 2,000.

	Q2		01.01 - 30.06		FULL YEAR
NOK MILLION	2014	2013	2014	2013	2013
Change in individual loan loss provisions	-0.2	-0.3	0.1	-0.4	-0.3
Change in grouped loan loss provisions	-0.1		-0.3	-1.1	-0.2
Other effects on loan loss provisions	0.3	0.2	0.3	0.1	0.4
Realised losses specifically provided for previously		-0.2		-0.2	-1.5
Realised losses not specifically provided for previously					-0.5
Recoveries on previous realised losses
Loan losses for the period	0.0	-0.3	0.2	-1.7	-2.0

The loan portfolio is purchased from Storebrand Bank ASA. In the opinion of the Board of Directors, the quality of the loan portfolio is such that there is no need for additional loan loss provisions on individual or for groups of loans as of 30 June 2014.

NOTE 16 QUARTERLY PROFIT AND LOSS

NOK MILLION	Q2 2014	Q1 2014	Q4 2013	Q3 2013	Q2 2013
Interest income	144.3	144.0	149.4	162.3	172.0
Interest expense	-82.7	-78.9	-84.0	-93.2	-105.5
Net interest income	61.6	65.2	65.4	69.2	66.5
Fee and commission income from banking services
Fee and commission expenses for banking services
Net fee and commission income	0.0	0.0	0.0	0.0	0.0

Net gains on financial instruments	-9.5	-0.1	-0.2	-0.4	-1.3
Total other operating income	-9.5	-0.1	-0.2	-0.4	-1.3

Staff expenses	-0.1		-0.1
General administration expenses	-0.4
Other operating cost	-3.7	-3.7	-3.7	-4.3	-4.0
Total operating costs	-4.2	-3.7	-3.8	-4.3	-4.0

Operating profit before loan losses	48.0	61.4	61.5	64.5	61.2
Loan losses for the period	0.0	0.2	0.9	-1.2	-0.3
Profit before tax	48.0	61.6	62.4	63.2	60.9
Tax	-13.0	-16.6	-17.3	-17.7	-17.1
Profit for the year	35.0	45.0	45.0	45.5	43.9

- Declaration by the Board of Directors and the Chief Executive Officer

The Board of Directors and the Chief Executive Officer have today considered and approved the half-yearly report and half-yearly accounts of Storebrand Boligkreditt AS for the first six months as at 30 June 2014 (the 2014 half-yearly report).

The half-yearly report has been prepared in accordance with the requirements of IAS 34 Interim Financial Reporting as approved by the EU, as well as the additional Norwegian requirements set out in the Securities Trading Act.

The Board of Directors and the Chief Executive Officer hereby confirm that, to the best of their knowledge, the half-yearly accounts for 2014 have been prepared in accordance with the current accounting standards, and the information contained in the accounts gives a true and fair view of the company's assets, liabilities, and financial position taken as a whole as at 30 June 2014.

The Board of Directors and the Chief Executive Officer confirm that, to the best of their knowledge, the halfyearly report gives a true and fair summary of important events during the accounting period and their effect on the half-yearly accounts. The Board of Directors and the Chief Executive Officer also confirm that, to the best of their knowledge, the description of the most important risk and uncertainty factors that the business faces in the next accounting period, together with the description of material transactions with close associates, provide a true and fair summary.

Lysaker, 15 July 2014 The Board of Directors of Storebrand Boligkreditt AS

Heidi Skaaret Chairman of the Board

Geir Holmgren Deputy Chairman of the Board

Leif Helmich Pedersen Thor Bendik Weider

Åse Jonassen Chief Executive Officer

Investor Relations contacts:

ÅSE JONASSEN CEO [email protected] +47 4157 7397 TROND FINN ERIKSEN Head of IR [email protected] +47 9916 4135

Storebrand Boligkreditt AS Head office: Professor Kohtsvei 9, P. O. Box 474, NO-1327 Lysaker, Norway Telephone: +47 08880, www.storebrand.no