Bjørn Erik Næss, chief financial officer

SEB Enskilda Nordic Banks Seminar, May 26 2010

DnB NOR Group

2

Agenda

Actions ahead of Basel III

DnB NOR in 2010 - status

Growth opportunities & ambitions

Basel III – new regulations

3

1st quarter 2010

Continued positive cost trendContinued positive cost trend

Profit to DnB NOR's shareholders: NOK 3.1 billion (3.1)

Profit to DnB NOR's shareholders: NOK 3.1 billion (3.1)

Sound pre-tax operating profit before write-downs: NOK 4.9 billion (6.1)

Sound pre-tax operating profit before write-downs: NOK 4.9 billion (6.1)

Lower than expected write-downs on loans: NOK 0.9 billion (1.6)

Lower than expected write-downs on loans: NOK 0.9 billion (1.6)

Return on equity: 12.5 per cent (15.8)Return on equity:

12.5 per cent (15.8)

4

Strong growth trend has continued in 2010

6 109

3 457

5 043

4 109

4 940

1Q09 2Q09 3Q09 4Q09 1Q10

NOK million

2 934

643

1 7601 689

2 917

1Q09 2Q09 3Q09 4Q09 1Q10

NOK million

3 095

1 200

2 167 2 122

3 117

1Q09 2Q09 3Q09 4Q09 1Q10

NOK million

Pre-tax operating profitbefore write-downs

Profit for the period Profit for the period afterminority interests

5

Positive development in volume growth 1)

1) Figures at end of period

1 1261 115

1 1741 192

1 016971

1 093

950

1 0471 085 1 062

1 022

1 1091 1281 121 1 117

910

1 043 1 0531 0461 037

957

31 Dec.

31March

30June

30Sept.

31Dec.

31March

30June

30Sept.

31Dec.

31March

2007 2008 2009 2010

DnB NOR GroupDnB NOR Group excluding DnB NORDDnB NOR Group adjusted for exchange rate movements

DnB NOR Group excluding DnB NORD, adjusted for exchange rate movements

NOK billion

6

Stable development in average interest rate spreads 1)

0.810.88 0.97

1.341.58 1.611.60 1.63 1.58

1.24 1.301.16

0.68

0.33 0.30 0.29 0.23 0.29

1.01 0.98 1.041.12 1.16 1.16 1.16 1.13 1.12

5.966.40 6.60

5.91

3.45

2.461.89 2.05 2.27

1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10

3-month NIBOR

Lending spread

Combined spread- weighted average

Deposit spread

1) Excluding lending to and deposits from credit institutions and impaired loans

Quarterly development in interest rate spread (per cent)

7

400-600

Continuous focus on cost reductions and efficiency improvements

Process efficiency and general streamlining

Procurement

Retail Banking: •Restructuring of Norwegian banking operations

Staff/support functions:•Centralisation and streamlining

One IT:•Coordination and consolidation

850-950

300-400

100-150

150-200

Savings NOK million

Realised and targeted cost savings

8

Still room for lowering our cost/income ratio

9

Basel III – new regulations

10

Several analysis conclude that the proposed Basel III will be too tough on traditional banking models

* Source: JP Morgan analysis: ”Global Banks - Too big to fail? – Running the numbers”

Equity capital requirements for

global banks $221bn*

RoE forglobal banks down

from 13.3% to 5.4%*

Increased funding needs

Reduced lending growth Increase in prices

Customers and economies will be negatively affected

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DnB NOR will be among the least affected of the European banks

Capital level- Already compliant- High-quality composition

Counterparty risk

- Minimal exposure to derivative markets

Capital deductions- Deductions for insurance subsidiaries already accounted for- Deferred tax assets and goodwill fully deducted

12

Only proposed changes in net stable funding ratio will create a shortfall

Leverage ratio- Strong capitalisation and business model

Deposit guarantee scheme- Already above EUR 100 000 and well funded

Net stable funding ratio

- Shortfall, deposit haircuts are unreasonably high?

Liquidity coverage ratio

- Compliant as of today

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A very robust and high-quality capital structure

* Full implementation of IRB**Full IRB and Swedish model for calibrating insurance exposure

14.2 % 14.6 %13.9 % 13.5 %

9.4 %

12.0 %

13.7 %

11.2 %

Tier 1 capital ratio Nordic peers 1Q2010, Basel II

14

The strongest leverage ratio among Nordic peers

* Tier 1/total assets

Leverage ratio* Nordic peers 1Q2010

15

13 per cent return on equity in 2012 (and beyond) just as ambitious as the 16 per cent target set in 2007

Interest on equity

Contribution from leverage

Interest on equity

Contribution from leverage

16 %

13 %

Lower interest rates

Increased capitalisation

Simplified illustration of effects of changes on RoE targets set in 2007 and in 2010

2007 2010

16

Several variables will help DnB NOR achieve its 13 per cent RoE target in 2012

Normalised tax level of 24 per cent

Reduced costs

Volume growth

Lower write-downs

Increased interest rates

17

Actions ahead of Basel III

18

Strengthened capitalisation levels through retainedearnings and NOK 14 bln share issue in 2009

1) Including 50 per cent of profit for the period

5.8 6.1

8.5 8.6

6.7 7.0

9.3 9.4 9.3 9.4

11.7 12.0

Equity Tier 1 capital ratioTier 1 capital ratioTier 1 capital ratio subject to full IRB implementation

31 December 31 March 31 December 31 March 2008 2009 1) 2009 2010 1)

Per cent

19

Raised level of long-term funding, tightened internal limits for short-term funding

Share of stable long-term funding*Internal target**

Average residual maturity, long-term senior debt and covered bonds (years)

* Deposits from customers, subordinated debt, covered bonds and senior debt > 12 months residual maturity

** Internal target for stable long-term funding increased from 88% to 90% in 2009

**

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Stable access to long-term funding – longer maturities at competitive prices

NOK billion MaturitySpread

(3-month Euribor)

Covered bonds 41.1 6.7

Senior bonds 12.1 5.7

Total 53.2 6.5 49bp

NOK billion Maturity Spread

Covered bonds 10.7 12.1

Covered bonds, Norges Bank (central bank) 90.3 4.2

Senior bonds 39.0 4.6

Total 139.1 4.9 50bp

NOK billion Maturity Spread

Covered bonds 57.5 5.9

Covered bonds, Norges Bank (central bank) 29.1 2.8

Senior bonds 100.5 3.7

Total 187.2 4.3 48bp

2010

2009

2008

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Further issues

Provide for more selective deposit gathering strategies

Continued focus on long term funding- Increased emphasis on funding diversification by geography and

by intruments (e.g. DnB NOR Naeringskreditt)

High attention on Basel III signals- uncertainties on final definitions and calibrations

Controlled balance sheet growth

22

Growth opportunities & ambitions

23

Macroeconomic outlook 2010

Developments in the Norwegian labour and housing markets may indicategrowth - credit demand lagging behind

Developments in the Norwegian labour and housing markets may indicategrowth - credit demand lagging behind

The Norwegian economy is far more robust than most other European economies

The Norwegian economy is far more robust than most other European economies

High debt and high unemployment in some EU countries may delay an economic recovery

High debt and high unemployment in some EU countries may delay an economic recovery

Geographical variations in rate of recovery- EU countries lagging behind

Geographical variations in rate of recovery- EU countries lagging behind

Growth in world economy stronger than expected,but still subject to considerable uncertainty

Growth in world economy stronger than expected,but still subject to considerable uncertainty

24

Still an untapped potential in Norway

Total market share DnB NOR- private and corporate

25

Significant growth ambitions based on Norwegiantraditional industries

Growth opportunities within industries where we already have a strongposition

Energy will be the most important growth area over the next 2-3 years

Continue to create value through a stronger emphasis on non lendingincome

Solid position in our home market and within selected industriesinternationally

A high-quality customer portfolio

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Ambitions 2012Ambitions 2012 Long-term ambitionsLong-term ambitions

Financial ambitions

Be among the best capitalised banks in the NordicsNOK 2 billion in cost reductions

NOK 22-25 billion in pre-tax operating profits before write-downs

Cost/income ratio below 46 per cent

Return on equity above 13 per cent

Approx 50 per cent dividend

Long-term AA rating

Thank you