SpareBank 1 Sørøst-Norge (Buy, TP: NOK60.00) -
Boosted by ~13bp of loan loss reversals, SOON reported a Q2 ROE of 12.4%, above its >11% target. The board has decided to distribute the proposed additional DPS of NOK1.5, leaving the 2022 total payout ratio at ~91%. With an end-Q2 CET1 ratio of 19.4% versus its >17% internal target, we see scope for further generous dividend distributions. We have made only minor changes to our 2024–2025e EPS. Trading at a 2024e P/E of ~8.9x, we continue to find the valuation undemanding, and reiterate our BUY and NOK60 target price.Sparebank 1 BV, formerly Sparebank1 Buskerud-Vestfold (the Bank), is a Norway-based regional bank. It is primarily active in Buskerud, Kongsberg, Drammen and Vestfold in Norway. It is engaged in the provision of a range of banking and related products and services to both private clients and small and middle-sized enterprises. Its products and services include financing, payment processing, savings accounts, insurance and real estate services. The Bank is active through branches in Drammen, Kongsberg, Hvittingfoss, Horten, Tonsberg, Sandefjord, Larvik and Stavern. As of December 31, 2011, the Bank had three direct wholly owned subsidiaries, namely EiendomsMegler 1 Buskerud Vestfold AS, Georg Solberg AS and Imingen Holding AS. Additionally, it had one indirect subsidiary, Parkeringsplassen AS, and three associated companies. Sparebank1 BV is a member of the SpareBank1 bank alliance, which comprises 15 independent Norwegian banks.
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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