Costs in focus in stable quarter
We forecast a Q3 ROE of 11.8% (results due at 07:30 CET on 2 November). The results should be supported by resilient margins, solid lending growth outside of Denmark, and low loan losses, while activity is set to be seasonally lower QOQ. We estimate a Q3 CET1 ratio of 16.4%, above the regulatory minimum (12.0%) and the bank’s own target (14–15%). We reiterate our BUY and increase our target price to DKK285 (DKK275).DnB Nor is a holding company. Through its subsidiaries, Co. is financial services group in Norway. Co. provides a range of financial services, including loans, savings, advisory services, real estate broking, insurance and pension products for personal and corporate customers. Co.'s operations are divided into six segments: Personal Banking Norway, Corporate Banking Norway, Large Corporates and International, Markets, Wealth Management, and Products. As of Dec 31 2013, Co. had total assets of NOK2,389,438,000,000 and total deposit of NOK867,904,000,000.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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