DNB Bank (DNB) Q3 2024 earnings summary

Executive summary

• Third quarter profit reached NOK 12,160 million, up 19.9% year-over-year, with EPS at NOK 7.83 and annualised ROE at 18.9% (18% adjusted for one-off gain).

• Net interest income rose 2.6% year-over-year and 2% sequentially, driven by lending growth and increased activity.

• Net commissions and fees reached an all-time high in Q3, up 11.1% year-over-year, with strong performance in asset management and investment banking.

• Norwegian economy remains robust with signs of a soft landing, low unemployment, and rising household income.

• Acquisition of Carnegie Group announced, expected to close in H1 2025, strengthening Nordic investment banking and wealth management.

Financial highlights

• Net interest income was NOK 16,129 million (+2.6% YoY), total income NOK 22,851 million, and profit for the period NOK 12,160 million.

• Net other operating income was NOK 6,722 million (+28% YoY), including a NOK 716 million one-off gain from the insurance merger.

• Operating expenses were NOK 7,431 million, with a cost/income ratio of 32.5%.

• Impairment provisions were NOK 170 million, reflecting strong credit quality.

• Earnings per share increased 22.5% year-over-year to NOK 7.83.

Outlook and guidance

• Key policy rate remains at 4.5%, expected to hold until March 2025 before gradually declining.

• Management targets ROE above 13%, annual organic loan growth of 3–4%, and 4–5% annual growth in net commissions and fees.

• Cost/income ratio targeted below 40%, with long-term tax rate at 23% and 2024 tax rate at 20%.

• Dividend policy prioritizes nominal annual increases and payout ratio above 50%, with share buybacks as a capital optimization tool, subject to regulatory clarity.

• Wage growth expected to gradually decline to 3.3% by 2027.