DnB NOR in second quarter 2008: Sound performance in a challenging market

DnB NOR's pre-tax operating profits before write-downs were NOK 4.6 billion in
the second quarter, an increase of close to NOK 600 million compared with the
year-earlier period. The rise in profits reflected strong growth in lending and
a positive development in other operating income, including a rise in value of
the securities portfolio. 
 
Second quarter 2008
         Pre-tax operating profits before write-downs were NOK 4.6 billion (4.1)
         Profit for the period was NOK 3.4 billion (3.4)
         Return on equity was 18.1 per cent (20.4)
         Earnings per share were NOK 2.47 (2.50)
         Expenses represented 49.0 per cent of income (49.1)
         The core capital ratio at the end of the quarter, including 50 per
cent of first-half profits, was 6.9 per cent (7.4) 
(Figures for the second quarter of 2007 in parentheses)
 
"We are very satisfied with our financial performance, not least on account of
the international financial market turmoil. Our loan portfolio is of high
quality, with a low level of write-downs. DnB NOR has a satisfactory capital
base and good access to liquid funds," says Rune Bjerke, group chief executive. 
 
The turmoil in international financial markets has led to widening credit risk
margins and has thus reduced the value of the Group's bond portfolio in the
four preceding quarters. The values are recovered over the bonds' residual
maturity, and DnB NOR recorded NOK 331 million as income in the second quarter
due to changes in bond prices. 
 
"The recovery of bond values is in line with what we have previously
communicated, but that does not mean that the turmoil in international
financial markets is over. This is still a difficult time internationally.
Nevertheless, our accounts show that the Group's underlying operations are very
sound, and based on the situation at end-June the ambition of achieving pre-tax
operating profits before write-downs in 2008 on a par with last year and NOK 20
billion in 2010 is retained," says Rune Bjerke. 
 
"The cost programme, as previously communicated, is on schedule and has been
extended from NOK 1 billion to NOK 1.4 billion with full effect from the end of
2010," says Rune Bjerke. 
 
Strong growth in income and lending
 
Income in the second quarter rose by 14 per cent compared with the year-earlier
period. The business areas generally showed a healthy performance and took new
initiatives to strengthen future operations. The Group's diversified operations
ensured a rise in income which counteracted financial market volatility. 
 
Total lending rose by close to twenty per cent and passed NOK 1 000 billion
during the quarter. The rise was a result of several small-scale acquisitions,
general growth in the international corporate market portfolio and growth in
the Norwegian retail market. 
 
"Our markets continue to show a healthy trend, but we expect more subdued
growth in credit demand in the coming quarters. Write-downs and non-performing
commitments remain at a low level. DnB NOR has a sound platform for the years
to come," says Bjerke. 
 
 
 
Contact person:
Trond Bentestuen, group executive vice president, Corporate Communications, 
tel.: +47 950 28 448

The quarterly report, presentation and Supplementary Information for Investors
and Analysts can be downloaded from www.dnbnor.com