DnB Markets - Sparebanken Ost ASA (SPOG) Sparebanken Øst (Buy, TP: NOK52.00) - 2019 dividend reinstated

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DnB Markets

Håkon Astrup

EUR 88.68 For Business Accounts Only

Sparebanken Øst (Buy, TP: NOK52.00) - 2019 dividend reinstated

SPOG opted to reinstate its previously halted 2019 dividend of NOK3.6/share in conjunction with the Q3 report. Furthermore, NII was materially above our estimate and the bank expects lending growth to rise as a result of its highly competitive customer rates. Accordingly, we have raised our 2021–2022e net profit by 1–2% and our target price to NOK52 (50). We reiterate our BUY as we consider the valuation attractive at 2020e P/B of 0.7x.

29/10/2020 15 EN

Underlying

Sparebanken Ost ASA

Sparebanken Ost (the Bank) is a Norway-based regional bank. The Bank is engaged in the provision of both banking and financial products and services to individuals and businesses. The Bank's primary market area is the lower part of Buskerud county and the Drammen region. Its product and service offering includes loans, cards, payment services, savings accounts, pension funds, life and non-life insurance, investment services and foreign exchange. As of December 31, 2011, the Bank had such subsidiaries, as Sparebanken Ost Boligkredit AS, a mortgage company; AS Financiering, a car financing company; Sparebanken Ost Eiendom AS, which was engaged in real estate development and operations, and Ost Prosjekt AS, a subsidiary supporting the Bank's activities. As of December 31, 2011, the Bank's largest shareholder was MP Pensjon (9.89%).

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NO0006222009 Oslo Bors Norway

Provider

DnB Markets

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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Analysts

Håkon Astrup

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On course for ample distributions

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SpareBank 1 Helgeland (Hold, TP: NOK167.00) - Softer margin, but lower costs

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Sparebanken Øst (Buy, TP: NOK52.00) - 2019 dividend reinstated

Outlook for continued high rates

Sparebanken Øst (Hold, TP: NOK74.00) - Solid distribution prospects

On course for ample distributions

Airthings (No_rec, TP: NOK) - Recommendation and target price withdrawn

SpareBank 1 Helgeland (Hold, TP: NOK167.00) - Softer margin, but lower costs

Smartoptics (Buy, TP: NOK27.00) - We remain optimistic

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