DNB Bank DNB Boligkreditt. March 2012

Transcription

1 DNB Bank DNB Boligkreditt March 2012

2 Contents DNB ASA ("DNB") A brief overview The Norwegian Economy - Important for DNB Financial performance and capital The Norwegian mortgage market and mortgage lending in DNB Funding Appendix - A : Cover pool portfolio information - B : The Norwegian Covered Bond legislation - C : DNB Bank Loan book and asset quality 2

3 The backbone of the Norwegian financial system DNB - Norway's leading financial services group Approximately 30% market share of the retail market Approximately 30% market share of the corporate market The leading financial institution in the market for large Norwegian corporates Norway's largest life insurance company Credit Ratings: Moody's: Aa3 (on review), S&P: A+ (stable), DBRS: AA (stable) Essential to the Norwegian payment system 34% owned by the Norwegian Government 3

4 The DNB Group DNB ASA DNB Bank ASA Aa3 / A+ / AA DNB Life and Asset Management (Senior/ short term issuance) Bank DNB NORD AS DNB Boligkreditt AS (Covered Bonds) 100% owned by DNB Bank and functionally an integrated part of the parent Mortgages originated within DNB Bank s distribution network in accordance with the bank's credit policy 4

5 Norway is of vital importance to the Group More than 80 per cent of our lending stems from Norway More than 80 per cent of our income stems from Norway More than 80 per cent of our deposits stems from Norway Write downs excluding DNB NORD 2010: Write downs excl. DNB NORD 2011: 11 bp 17 bp Only Norwegian residential mortgages in the Cover Pool backing our Covered Bonds 5

6 The Norwegian Economy: Of high importance to DNB 6

7 A rock-solid Norwegian economy Annual budget deficit/surplus for 2012 (forecast) General government net financial liabilities (As a percentage of nominal GDP 2011) Other countries budget deficit: USA 9.3 % Japan 8.9 % Canada 4.1 % Australia 1.5 % Note: Budget surplus/deficit calculated as a percentage share of country GDP; forecasts for 2012 Source: OECD Economic Outlook No. 90, November 2011 Source: OECD Economic Outlook No. 90, November

8 The Norwegian economy is a steady performer Real GDP growth (As a percentage change from previous year) 8,0% 6,0% Norway Sweden UK Euro Area Forecast 4,0% 2,0% NORWAY 0,0% F2012 F2013-2,0% -4,0% -6,0% Source: OECD Economic Outlook No. 90, November

9 Norway has consistently lower unemployment rates Unemployment rate (As a percentage of total workforce) 12,0% Norway Sweden UK Euro Area Forecast 10,0% 8,0% 6,0% 4,0% NORWAY 2,0% 0,0% F2012 F2013 Source: OECD Economic Outlook No. 90, November

10 Financial performance and Capital 10

11 DNB delivers healthy profit Pre-tax operating profit before write-downs (NOK bn) 14,1 15,1 15,6 18,7 21,1 21,8 7,7-0,3 0,2 3,5 3,0 3, Pre-tax operating profit before writedowns Write-downs 11

12 Key financial ratios DnB ASA Return on equity 11,4 13,6 10,6 12,4 22,0 19,5 18,8 17,7 Cost income 47,1 47,6 48,3 51,4 50,6 50,1 50,2 56,0 Comb. weighted total average spread 1,12 1,15 1,15 1,04 1,00 1,08 1,19 1,30 Write down ratio (%) 0,28 0,26 0,67 0,33 0,02-0,03 0,02-0,03 Tier 1 ratio 9,9 10,1 9,3 6,7 7,2 6,7 7,4 7,6 Total capital 11,4 12,4 12,1 9,5 9,6 10,0 10,2 10,7 DNB Bank ASA (consolidated) Tier 1 ratio 9,9 9,2 8,4 7,0 7,9 6,8 7,7 7,5 Total capital 11,5 11,7 11,4 9,9 10,5 10,2 10,6 10,6 Tier 1 ratio 11,4 % after full IRB implementation 12

13 Business areas NOK million Pre-tax operating profit after write-downs January - December Jan.-Dec Jan.-Dec (1 481) (1 449) Retail Banking Large Corporates and International excl. DNB Baltics and Poland DNB Markets Insurance and Asset Management DnB NORD 13

14 Net non-performing and doubtful commitments (1) Per cent NOK billion Dec Dec Dec March 30 June 30 Sept. 31 Dec. 31 March 30 June 30 Sept. 31 Dec ) Includes non-performing commitments and commitments subject to individual write-downs. Accumulated individual write-downs are deducted. DNB Baltics and Poland DNB Group excl. DNB Baltics and Poland As a percentage of net lending As a percentage of net lending excl. DNB Baltics and Poland 14

15 Write-downs in per cent of lending Full year Full year Per cent 4Q11 3Q11 2Q11 1Q11 4Q Total write-downs in relation to average volumes (annual basis) DNB excl. former DnB NORD Former DnB NORD DNB Baltics and Poland

16 Strengthened capital position 31 December2011 Equity Tier 1 ratio 9,4% Tier 1 ratio 9,9% Total capital ratio 11,4% (1) Equity ratio 5,6% At full IRB implementation : Equity Tier 1 ratio 10,8% Tier 1 ratio 11,4% Total capital ratio 13,1% 1) Equity relative to total assets 16

17 Equity Tier 1 Capital according to Nordic rules Per cent Common equity Tire 1 capital as at 31 December 2011 (CET 1) Adjusted for Nordic risk weights for credit cards Adjusted for Nordic risk weight for businesses Adjusted for Nordic risk weights for homes Adjusted for full IRB DNB risk weights Reported capital adequacy Pro forma full IRB IRB with "Nordic" risk weight 17

18 DNB has strengthened its position significantly DNB s position ranked by market value - 31 Dec 2006 Nordic countries Europe Global DNB s position ranked by market value - 30 June 2011 Nordic countries 2 Europe Global 18

19 The Norwegian Mortgage Market And Mortgage lending in DNB 19

20 The Norwegian Residential Mortgage Market Nearly 80% of Norwegians own their home: Few mortgages are buy-to-let. Norway is primarily a floating interest rate market: The large majority of mortgages originated by DNB are floating rate. Rates on floating rate mortgages can be reset at any time and at the bank s own discretion, by giving debtors six weeks notice. In Norway, all borrowing costs are deductible from taxable income at the current rate of 28%: Households are therefore better able to withstand an increase in interest rates. Loans are normally underwritten with a term of years: Average size for new mortgages originated by DNB is approximately NOK 1,000,000 (EUR 125,000). Source: Finance Norway - FNO 20

21 House Price Development House prices as of January 2012 is about 19% above the temporary peak in 2007, which was followed by a decline of roughly 10% until November The large majority of Norwegian household debt is based on floating rates. Interest rate cuts during 2009 boosted household disposable income and thus probably contributed to a substantial recovery in existing home prices. High growth in population and good growth in income could promote a further increase in house prices. On the other side the unemployment rate has bottomed out and the house building activity is increasing Norwegian Real House Price Index, (1985=100) CPI-deflated Disposable income deflated Source: Statistics Norway, EFF, NEF, Finn.no, Econ Pöyry, DNB Markets and Norwegian Central Bank 21

22 Household financial wealth exceeds household debt Norwegians savings June 2010 Billion NOK Households wealth and debt June 2010 Holiday housing Deposits and cash Equity and bonds Mutual funds 6000 Insurance funds* Real wealth Residential homes** Other financial wealth Financial wealth Houshold debt 0 Household wealth Houshold debt *Occupational pension, private pension, life insurance savings etc. ** Finance Norway s estimates 22

23 Rise in number of households 1) and completed dwellings. Annual Figures ) Rise in households Completed dwellings halvår 1) Estimated rise in number of households ) Rise in number of households for first half of 2011 is based on population growth in this period Sources: Statistics Norway and Norges Bank 23

24 Mortgage lending in DNB is based on cash flow Approval of a loan is based on: 1. Willingness to repay the loan: - By means of scoring model based on historical behaviour 2. Capability of repaying the loan: - In calculating the capability or ability to repay, an adequate margin (currently approx 5,0%, increased from 4,0%), accommodate the effects of a possible increase in interest rates, is included in the model 3. Collateral: - Credit should thus not be approved solely on the basis of the proposed collateral All borrowers are subsequently classified monthly by behaviour scoring DNB - Mortgage Loan payment characteristics : Standard payment method is monthly in arrears More than 95 % of the customers pays their mortgages by fixed debit of their bank account 24

25 DNB Boligkreditt Covered Bonds Rating: AAA / Aaa / AAA Portfolio Characteristics Cover Pool Size Number of Mortages in the Cover Pool Average Loan Balance Over C ollateralisation 29,6 % Weighted Average LTV Indexed 56,10% Weighted Average Seasoning 51 months Pool statistics as of November 2011 The cover pool consists of 100% Norwegian Residential Mortgages - No substitution with assets of lower quality Source: DNB 25

26 Funding 26

27 DNB has improved the long term funding structure significantly since the financial turmoil started in 2007 Share of stable long-term funding* Average life of long term funding (Senior debt and covered bonds) 110 % % 4, % 4 95 % 90 % 3 2,43 85 % 2 80 % 75 % * Deposits from customers, subordinated debt, covered bonds and senior debt > 12 months residual maturity. Internal target for stable long-term funding increased from 88% to 90% in

28 Strong growth in deposits Ratio of deposits to lending Development in deposits percent 54,8 57,8 53,9 60,3 57,8 NOK billion Dec. 31 March 30 June 30 Sept. 31 Dec. 31 March 30 June 30 Sept. 31 Dec. 31 March 30 June 30 Sept. 31 Dec. 31 March 30 June 30 Sept. 31 Dec Dec March June Sept Dec 2011 Deposits at end of period Deposits, adjusted for exchange rate movements 28

29 USD mio Outstandings, USCP/ECP/CD/YCD USCP ECP/CD YCD Total 32

30 DNB Benchmark issuances in 5 currencies in January 2012 Covered - Euro mill 5,25 year - NOK mill 6 year Senior - Euro mill 10 year - GBP 400 mill 8 year - JPY 65 bill 5 year - SEK mill 5 year 30

31 DNB Issuance of long term debt 2012 EURO bill Tenor Covered Bonds 2,4 5,5 Senior Bonds 2,9 7,9 Sum 5,3 6,8 Subordinated debt 0,8 10nc5 Total 6,1 LTRO Funding 1,1 3, EURO bill Tenor Covered Bonds 12,5 6,5 Senior Bonds 3,6 8,8 Sum 16,1 7,0 LTRO Funding 2,0 3, EURO bill Tenor Covered Bonds 10,6 7,5 Senior Bonds 4,0 7,3 Sum 14,6 7, EURO bill Tenor Covered Bonds 1,3 12,1 Covered Bonds (Central Bank) 10,7 4,2 Senior Bonds 4,5 4,6 Sum 16,5 4,9 31

32 A well established International Covered Bond issuer International Covered Bond issuance Maturity Redeems Euro 1,500 mn 5 years (2012) Euro 2,000 mn 5 years (2013) Euro 2,000 mn 5 years (2015) Euro 2,000 mn 5 years ( Jan) Euro 2,000 mn 5 years ( Oct) Euro 1,500 mn 7 years ( Jan) Euro 2,000 mn 5 years (2017 Apr) Euro 1,500 mn 7 years ( Aug) Euro 1,500 mn 10 years (2021) USD 2,000 mn 5 years (2015) USD 2,000 mn 5 years (2016) AUD 600 mn 5 years (2016) Registered Covered Bonds: 2008: Euro 1,000 mn 25 issues Avg. mat: 11 years 2009: Euro 1,000 mn 20 issues Avg. mat: 13 years 2010: Euro 1,600 mn 43 issues Avg. mat: 14 years 2011: Euro 850 mn 24 issues Avg. mat: 12 years CHF market: CHF 2,175 mn 11 issues Mat: 5 20 years 32

33 DNB is a well established international borrower - but with a strong focus on diversification of funding sources Deposit coverage as of December 2011 DNB Group 57,8 % DNB Bank 98,9 % (Excluding DNB Boligkreditt) DNB Bank is a well established international borrower: EMTN program of EUR 45 billion Samurai program (JPY) USCP program of USD 18 billion Yankee CD program of USD 12 billion ECP/CD program of EUR 10 billion Covered Bonds form an important part of the funding profile: Covered Bond program of EUR 55 billion Established 2007 Covered Bond program of USD 12 billion Established 2010 Covered Bond program of AUD 4 billion Established

34 Summing up; Look to Norway! 34

35 Norway is of vital importance to DNB DNB is 34% owned by the Norwegian government. The Norwegian economy is performing significantly better than most others, including with Scandinavia. More than 80 per cent of our income stems from Norway More than 80 per cent of our lending stems from Norway 35

36 Norway The Country To Be 15 December 2008: 9 December 2010: If you are going to be any country in the world heading into an economic crisis, be Norway. This Nordic country of just 4.7m people has amassed $332bn ( 249bn) in oil revenues and is now about to start s p e n d i n g i t. 36

37 Contacts 37

38 Long Term Funding Contacts Thor Tellefsen, Senior Vice President, Head of Long Term Funding - Phone direct: Fax number: thor.tellefsen@dnb.no Trond Sannes Marthinsen, Vice President, Long Term Funding - Phone direct: Fax number: trond.marthinsen@dnb.no Steve Stølen, Vice President, Long Term Funding - Phone direct: Fax number: steve.stolen@dnb.no 38

39 Appendix A: Cover pool portfolio information 39

40 Portfolio characteristics Numbers in NOK Portfolio Characteristics Rating Total outstanding balance of mortgages in the cover pool Number of mortgages Number of borrowers Average loan balance Weighted average seasoning (in months) * Weighted average indexed LTV (%) Weighted average remaining terms (in months) Loans with Interest Only (% of cover pool) AAA / Aaa / AAA 456,293,216, , ,318 1,074, Loans in arrears > 90 days (% of cover pool) 0.15 Pool statistics as of 30 November 2011 * Seasoning indicates the number of months since collateral for the loan was established Register Mortgages Substitution assets Total C over Pool 456,293,216, ,293,216,081 C overed Bonds 352,015,037,475 Over C ollateralisation (%) * 29.6 * The nominal Over Collateralisation (OC) percentage may change from time to time. DnB NOR Boligkreditt has undertaken not to reduce the current OC percentage if to do so would reduce any credit rating applying to the outstanding covered bonds. If more than one rating agency has assigned a rating to the outstanding covered bonds, DnB NOR Boligkreditt will adhere to the highest OC percentage requirement. The current OC is higher than the strictest rating requirement and the OC percentage may therefore be reduced in the future. The OC policy of DnB NOR Boligkreditt in full detail may be found in the Base Prospectus. 40

41 Indexed LTV, Seasoning and repayment structure Indexed LTV distribution Range Loan balance % Number of loans % 0 40% 90,943,721, % 156, % 40% 50% 52,352,803, % 48, % 50% 60% 77,185,239, % 59, % 60% 70% 118,669,540, % 83, % 70% 75% 90,009,758, % 58, % 75% 80% 18,036,923, % 11, % 80% 85% 3,555,438, % 2, % 85% 90% 1,775,944, % 1, % > 90% 3,763,846, % 2, % Total 456,293,216, % 424, % Seasoning Loan Balance % Number of loans % < 18 months 131,981,844, % 93, % 18 - < 60 months 176,881,113, % 148, % 60 months 147,430,257, % 182, % Total 456,293,216, % 424, % Repayment structure Loan Balance % Number of loans % WA LTV Amortization 267,995,631, % 287, % 52.7 Interest only 188,297,584, % 137, % 60.9 Total 456,293,216, % 424, %

42 Interest rate, Loans in arrears and Flexible loans Interest rate Loan Balance % Number of loans % Fixed 37,593,742, % 32, % Floating 418,699,473, % 392, % Total 456,293,216, % 424, % Loans in arrears Loan Balance % of cover pool Number of loans % of cover pool > days 649,620, % % > days 160,969, % % > 90 days 675,198, % % Flexible loans % of cover pool Number of flexible loans 103, % Total limit on flexible loans 176,126,919,266 Balance drawn 139,163,027, % Percentage drawn of limit 79.0 % 42

43 Geographical distribution Geographical distribution Region Loan Balance % Number of loans % Akershus 86,023,559, % 71, % Aust-Agder 8,055,290, % 8, % Buskerud 29,620,383, % 29, % Finnmark 6,946,220, % 7, % Hedmark 10,340,155, % 12, % Hordaland 35,217,144, % 30, % Møre og Romsdal 7,439,328, % 7, % Nordland 12,092,683, % 14, % Nord-Trøndelag 6,394,420, % 6, % Oppland 16,921,647, % 21, % Oslo 94,999,679, % 75, % Østfold 29,912,306, % 34, % Rogaland 29,167,581, % 22, % Sogn og Fjordane 1,762,059, % 2, % Sør-Trøndelag 15,954,126, % 13, % Telemark 10,962,842, % 13, % Troms 11,652,208, % 10, % Vest-Agder 7,860,462, % 6, % Vestfold 34,971,114, % 36, % Total 456,293,216, % 424, % 43

44 Asset type / Property type distribution Asset type Property type Asset type / property type Loan Balance % Number of loans Average loan balance WA Terms to maturity WA LTV Private ownership Detached 252,759,705, % 228,518 1,106, % Private ownership Semi-detached 56,296,502, % 47,144 1,194, % Private ownership Condominium 75,319,726, % 67,786 1,111, % Share in housing association Condominium 52,632,454, % 69, , % Share in housing association Semi-detached 7,031,045, % 7, , % Housing association 9,531,628, % 1,657 5,752, % Second home 2,530,696, % 2, , % Other 191,457, % , % Total 456,293,216, % 424,487 1,074, % 44

45 Defaulted loans in DNB Boligkreditt 0,30 % 0,20 % 0,16 % 0,15 % 0,14 % 0,15 % 0,15 % 0,15 % 0,13 % 0,13 % 0,10 % 0,10 % 0,10 % 0,10 % 0,00 % 0,01 % 0,02 % 0,03 % 0,05 % 0,06 % 90+ days Arrears 45

46 Future Updates On Cover Pool Developments Information about the cover pool of DNB Boligkreditt may be accessed via DNB Boligkreditt s web page: Contacts: - Helge Stray, Cover pool and Ratings: helge.stray@dnb.no Øyvind Birkeland, CEO DNB Boligkreditt: oyvind.birkeland@dnb.no Sverre Ellingsæther, Head of Financial Reporting: sverre.ellingsather@dnb.no Portfolio information will be updated in the second half of every September, December, March and June. 46

47 Appendix B: The Norwegian Covered Bond legislation 47

48 Norwegian Covered Bond Framework Overview The Norwegian covered bond framework was fully enacted in June 2007: - Prior to adoption, close discussions were held with rating agencies in order to provide investors with robust protection. Covered bondholders have dual recourse: - To the issuing entity. - A preferential claim over a cover pool of eligible assets. The NPV of the assets in the cover pool must at all times at least be higher than the NPV of the outstanding covered bonds. Covered bonds are issued by specialised credit institutions licensed and supervised by the Norwegian Financial Supervisory Authority (NFSA): - The activities of the company are limited to acquiring eligible assets and financing these predominantly by covered bonds. Norwegian covered bonds qualify for 10% risk weighting in eligible European jurisdictions and comply with the CRD of the EU: - Certain bonds cleared through appropriate clearing systems may be eligible as collateral for liquidity loans in the ECB. 48

49 Norwegian Covered Bond Framework (cont.) Eligible assets: Mortgage assets: - Residential property: 75% LTV - Commercial property: 60% LTV (By-laws of DnB NOR Boligkreditt exclude this asset class) Loans to municipalities, governments and other public sectors Liquid substitution assets, maximum 20% of cover pool Derivatives contracts Should property prices fall, the part of the loan that exceeds the relevant LTV-limit is still included in the cover pool and protects the covered bondholders, but is not taken into account when calculating the value of the pool. To maintain the value of the cover pool, new loans with LTV up to 75% must be added. The same principle applies to loans in default. All property values shall be set by a competent and independent person. ALM requirements: Matching requirements to control interest rate, foreign exchange and liquidity risk. 49

50 Norwegian Covered Bond Framework (cont.) Supervision by an Independent Inspector: - An Independent Inspector, appointed by the Norwegian FSA, monitors assets and liabilities on a regular basis, and the compliance with certain requirements laid down in the covered bond legislation. Suspected irregularities will be reported to the NFSA. The company s external auditor may be appointed. Bankruptcy proceedings are laid down in a special framework: - Should the issuing company go bankrupt, assets in the cover pool and the corresponding cash flows are separated from the bankruptcy estate. - Holders of covered bonds and derivative counterparties have a preferential claim over the cover pool assets. - The estate manager must seek to ensure that contractual payments for covered bonds and secured derivatives are made. To meet contractual payments, assets may be sold or new covered bonds issued. - Should the cover pool be unable to make contractual payments and an imminent change is unlikely, it will be wound down. The covered bonds/derivative counterparts rank pari passu. Claims on covered bonds are made based on the agreed future cash flow discounted at the market rate for comparable bonds in the relevant currency. 50

51 Appendix C: DNB Bank Loan book and asset quality 51

52 Loan book exposure by sectors EAD by segments as at 31 December 2011 (1) Real estate and contractors 14.8% (14.1%) DnB NORD 3.4% (3.9%) Private individuals 4.5% (5.0%) Shipping 7.3% (7.7%) Logistics, cruise and aviation 1.3% (1.4%) Offshore 3.3% (4.0%) Oil and energy 6.5% (4.8%) Leasing and factoring 3.3% (3.4%) Public sector 0.3% (0.6%) Fishing and fish farming 1.5% (1.4%) Trade 2.4% (2.4%) Manufacturing 4.1% (3.9%) Residential mortgages 37.2% (37.6%) Other corporate customers 7.4% (7.1%) Telecom and media 1.0% (1.2%) Services 1.7% (1.6%) Comparable figures as at 31 December 2010 in parentheses 1)Distribution of exposure at default based on internal segmentation of customers, excluding net non-performing and net doubtful commitments 52

53 DNB Bank PIIGS exposure No sovereign exposure TOTAL Sovereign Liquidity Portfolio, DnB Markets 1) DnB Bank Group, Other Total DnB Bank Group Portugal Ireland Italy Greece Spain NOK total (mln) Equivalent to (EUR mln): ) Markets exposure to the PIIGS countries through its international bond portfolio mainly comprises residential mortgage-backed securities (RMBS). The portfolio includes no investments in Treasury bonds. 53

54 Two areas with special attention Shipping and Logistics DNB Baltics 54

55 Shipping, offshore and logistic portfolio Exposure at default according to sector 1) Quarterly portfolio risk classification 1) Gas 10% (10%) Logistics 6% (6%) Offshore 24% (27%) Other nonshipping 4% (4%) PD 0,01% - 0,75% PD 0,75% - 2,0% PD 2,0% - Other shipping 4% (2%) Chemical and product tankers 8% (7%) Dry cargo 12% (15%) Cruise 4% (4%) Container 13% (11%) Crude oil tankers 11% (10%) RoRo/PCC 3% (3%) 31 Dec Mar June Sep Dec PD 0.01% % PD 0.75% - 2.0% PD 2.0% Dec Mar. 30 June Sep Dec Dec Mar 30 June Sep Dec )Figures as at 31 December Percentages as at 31 December 2010 in parentheses. 2)Based on DNB's risk classification system. The volume represents the expected outstanding amount in the event of default. PD = probability of default 1) Based on DNB s risk classification system. The volume represents the expected outstanding amount in the event of default. PD = probability of fedault 55

56 Our internal credit analysis has been based on low rate estimates Sources: Fearnleys, Clarksons 56

57 57

58 Former DNB NORD Took over 100 % of the JV from late 2010 NOK million 31 Dec 2011 Loan book Latvia ,1 % Lithuania ,5 % Estonia ,2% Poland ,4 % Total ,3 % 58

59 Former DNB NORD Took over 100 % of the JV from late 2010 NOK million 31 Dec 2011 Loan book Latvia ,1 % Lithuania ,5 % Estonia ,2% Poland ,4 % Total ,3 % 59

60 Lending and write-downs in DNB Baltics and Poland 4th quarter 2011 Full year 2011 Write-downs Write-downs Net lending as at on loans and in per cent of on loans and in per cent of Amounts in NOK million 31 Dec guarantees net lending 1) guarantees net lending 1) Latvia , Lithuania , Estonia , Poland , The Baltic States and Poland , Other 0 2) 96 46, DNB Baltics and Poland , ) Individual and collective write-downs, relative to average volumes (annual basis) 2) The portfolio was transferred to Norway during the fourth quarter of

61 % change YoY Baltic countries are among the EU leaders according to GDP growth rates 10 Real GDP growth e EU 27 0,3-4,3 2 1,6 Estonia -3,7-14,3 2,3 8 Latvia -3,3-17,7-0,3 4,5 Lithuania 2,9-14,8 1,4 6,1 Source: Eurostat, national statistics offices 61

62 Disclaimer This material has been prepared on the basis of the information provided by DNB Bank ASA (referred to as "DNB Bank") under the Covered Bond program and public available sources. DNB ASA the holding company of the DNB group is referred to as "DNB " in this presentation. This material does not constitute an offering circular in whole or part and you must read the actual offering circular related to the Covered Bond program and the notes which may be issued from time to time thereunder as referred to in this material (respectively the "Program" and the Notes ) before making an investment decision. The offering circular for the Program is available from the Arranger. You should consult the offering circular for more complete information about DNB and the Program. This material is presented solely for information purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments and should not be treated as giving investment advice. It has no regard to the specific investment objectives, financial situation or particular needs of any recipient. No representation or warranty, either express or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein. It should not be regarded by recipients as a substitute for the exercise of their own judgment. Any opinions expressed in this material are subject to change without notice and DNB Bank is not under any obligation to update or keep current the information contained herein. In addition, institutions mentioned in this material, their affiliates, agents, directors, partners and employees may make purchases and/or sales of the Notes as principal or agent or may act as market maker or provide investment banking or other services in respect of the Program or the Notes which may be issued from time to time thereunder. DNB, the Arranger and the Dealers and their respective affiliates, agents, directors, partners and employees accept no liability whatsoever for any loss or damage of any kind arising out of the use of all or any part of this material. The Notes are not to be offered or sold in any jurisdiction in circumstances in which the distribution of this document or the Notes would be prohibited in such jurisdiction. This document must not be acted on or relied on by persons who are not eligible to invest in the Notes. Any investment or investment activity to which this communication relates is available only to persons eligible to invest in the Notes and will be engaged in only with such persons. Furthermore, you should consult with your own legal, regulatory, tax, business, investment, financial and accounting advisers to the extent that you deem it necessary, and make your own investment, hedging and trading decisions (including decisions regarding the suitability of an investment in the Notes which may be offered from time to time under the Program) based upon your own judgment and advice from such advisers as you deem necessary and not upon any view expressed in this presentation. 62