DNB ASA Stock

Hello, and welcome to the DNB Q3 Conference Call. My name is George, I'll be your coordinator for today's event. [Operator Instructions] Please note, this conference is being recorded. I'd like to hand the call over to your host, Ms. Mitra Negård, Head of IR, to be in today's conference. Please go ahead, Mitra.

Thank you. Hi, everyone, and welcome to Third Quarter '26 Analyst Call. I am Mitra Negård, Head of Investor Relations. With me today, I have our CEO, Kjerstin Braathen, CFO, Rasmus Figenschou, EVP of Personal Banking, Maria Loevold, EVP of DNB Carnagie, Alexander Opstad, EVP of Risk Management, Eline Skramstad; and my colleague in IR on the [indiscernible].

We will begin with a brief recap from Kjerstin on the key highlights of today's results before opening the floor for Q&A.

Thank you, Mitra, and thanks for spending an hour with us today. I'll repeat a couple of the highlights from this morning's webcast and start a few words on the Norwegian economy, which continues to show its resilience this quarter. And as you may remember, we had a rate hike in the spring time, where we price towards our customers. And most of the impact of this repricing, you can see in today's numbers.

Then again, there was an additional rate hike by the Central Bank in September with an additional announced repricing, which will take effect sometime towards the end of November. But that is on the backdrop of an inflation that has come down, but it's proving stickier than expected to get down to the -- completely to the 2% level, which is targeted by the Central Bank. And the key policy rate in Norway is now 4.5%.

Beyond that, nothing really changes to reporting the economy. It's still resilient, growth of 1.1% this year, unemployment around the 2% level and household and industries that show resilience and strong performance. This plays into our numbers, and we believe that we put down a strong set of results today for our third quarter earnings. Return on equity comes in a 14.5%, which is above our minimum targeted return of 14%. We feel it makes sense also to show you the adjusted number if we take out our share of profit from the Luminor transaction, which was announced this quarter, which leaves then the return on equity at 15.5% for the quarter.

This is the result of profitable growth across the business areas. NII is up compared to the previous quarter by 2.5%. Strong point this quarter is net commission and fees, which is up by 14.6% from the same quarter in previous years. Where, again, we highlight investment banking and asset management as the two strong growth drivers in the Fremtind Commission category.

Investment banking is up by 38% compared to the same quarter last year and Asset Management 11.5 percentage points. Third quarter is usually a somewhat slower quarter on the fee side. So it's worth pointing out that the numbers are also impacted by certain larger transactions that were more or less than in the second quarter, but very much towards the end and closed early into the third quarter and reflected in these numbers.

Portfolio well diversified. Costs are down NOK 355 million, both reflecting a reduction in fixed salaries as well as variable salaries. But again, a higher level of variable salaries compared to the same quarter last year, reflecting that this has been an active third quarter for us. Portfolio is robust impairments come in at NOK 529 million, nothing to report of in terms of industry sector specific news nor migration in the portfolio. It remains robust and well diversified.

And then lastly, maybe reiterate our capital, which is very strong. 17.3%, 100 basis points above the required unexpected level of the FSA and this core equity is also after deducting the 30 basis points that has been deducted to account for the share buyback of 75 basis points of the share that were announced earlier today.

So with that, I think we're ready to open up for your questions.

[Operator Instructions] Our first question today is coming from Gulnara Saitkulova, calling from Morgan Stanley.

So at the press conference, you highlighted that the competitive pressure had a more limited impact on margins this quarter, providing some support to NII. Could you help us better understand the underlying drivers of this improvement? And how sustainable you believe it is going forward? More specifically, if you were to decompose the Q3 spread contribution, how much of the impact was attributable to competitive dynamics versus the rate effects, portfolio mix and any other effects? And looking ahead, how should we think about the relative contribution of these factors to NII and the trajectory of their customer spreads for the coming quarters?

Thank you so much for your question. And we did point out that there was a lower impact our NII this quarter from competitive pressure compared to what we stated for our second quarter number. We also iterated and underline one-off that this was not signaling a lower competitive pressure in general in the market. I think across the business, we would assess that as rather the same level of competition as we reported in the second quarter. But this also has to do, of course, with how we manage the portfolio, how disciplined we are in terms of allocation of capital. And we continue to focus on profitable growth across the business. And this has year-on-year resulted in a growth of 5% for the group as a whole, which we are quite happy with. So competition continues to be fierce.

I would reiterate also that we have no reason to believe that the market has changed. So we reiterate that the market is rational and all the large players active in this market have a specific return on equity as their most important financial targets. I think we have probably also said earlier that the most intense pressure is in the personal customer area as well as the lower end of businesses and also medium-sized enterprises is where we see highest intensity and competitive pressure. So no relief, but no increased intensity either. I think that would be a good way to describe it.

But do you have approximate breakdown of what exactly the competition erosion was for NII this quarter? Because in the previous quarter, it was roughly 1%, for this quarter, how are you thinking about it? Do you have enough breakdown?

I do not recognize the 1%. I think last quarter, we talked about 1/3 of the spread movement being reflective of competition. This quarter, we have not locking down the details any further.

Next, we'll go to Shrey Srivastava, of Citi.

My first one is actually on the strategic change you announced with some redundancies in technology and services. When you think about the potential of AI to transform your business, is this largely from a headcount perspective, just nonclient-facing functions being reduced and to be replaced by client-facing functions that some other banks have talked about? And internally, when you review the success of your AI initiatives, is it absolute cost reduction? Is it operating jaws? Or is it something else?

Then my second question is just related to the competitive dynamic in Norway. Is there anything you can help us with on, for example, the products per customer that you have relative to some of your smaller competitors and thereby the strength of your deposit franchise?

Thank you, Shrey. With regards to the strategic change related to AI, we think there is a broad potential in AI spanning anywhere from the ability to increase efficiency of our operations to improve our processes and to enhance customer value substantially. In addition to this, there is also areas where AI is creating new jobs and new opportunities. So it's a little bit all of the above. The changes that we have done so far, the areas where we have seen the most impact is definitely related both to real operational drop. That means cost reduction through lower number of FTEs but also enhanced customer values.

I'll shortly develop on a couple of examples. One of them is not related to the recently announced restructuring that is related to our customer services activity. There, we see that our sabot for both our brands is increasingly handling more requests without people being involved and our customers are increasingly happy with the services that they get. They actually prefer the chatbot to our people answering on chat because the people are too slow. The people that we have in the call centers are also better advisers and more efficient. They have automatic transcripts of all their conversations with their customers. We are able to pass that information around. So we have a fully updated picture of our dialogue with the customer at all times. And this has also led to the need for fewer people in the call center.

Another process that we have talked about is know your customer, where this is an internal process, but it's also customer facing, I would argue, because we ask our customers a lot of questions. And I think sometimes, we may have asked them to give us information we already have, but we were not historically good enough to extract all the information we have. With now the automatic processes, it's a better experience for customers and certainly a more efficient process for us.

With regards to the number of products as our deposit position, I will hand it over to Maria.

Thank you, Kjerstin. I could say I could speak for the Retail Banking area, and we can see an increase in number of products for customers from [ 4.7 to 4.8]. And I don't have the numbers from other banks, but I know that DNB customers at large, they have less than [ 1.7 ] relationships with other banks. And if you are with the digital-only brand, for example, they usually have around [ 2.5]. So you can say that a D&B customer, they have fewer banking relationships and at least 4.8 products for customers of today.

I can ask a final one about the right. How much of that improvement is driven by banking customers being onboarded to the broader DNB platform over the past few years?

Difficult to say. But for example, when it comes to saving agreements, we see that our Mortgage customers, they are increasing their investment in mutual funds. So for me, it's all about being able to selling more products to our existing customers. I don't have that number.

Our next question will be coming from Sofie Peterzens, of Goldman Sachs.

So my first question is on the share buyback. It was 0.75% this quarter. on the press conference, you mentioned that the share buybacks will be a bit faster going forward. Could you maybe just elaborate on this, like how much faster will they be? And should we expect like intra-quarter share buyback announcement going forward? So if you could kind of comment on this.

And then my second question is, when I look at a personal customer division, net interest income is exceptionally strong this quarter. Is that like a sustainable level? And how should we think about the internal transfer pricing within this division and is that kind of a good run rate going forward?

Thank you, Sofie. I'll quickly do your second one. The improvement in NII in personal customers is related to the first customer repricing that took close to a full effect in this quarter. And then, as I stated in the beginning, there is one more repricing that has been announced that will start to take effect towards the end of November.

I think Rasmus can answer that buyback.

Yes. There's no change to our capital allocation strategy, and we continue to allocate excess capital and announce share buyback programs when we are comfortable with our buffer to FSA expectations. Relating to the question this morning, I felt it more of a technical issue, so to speak, that 75 -- 0.75% share buyback program will be executed quicker, obviously, than a 1% share buyback program. We will continue to make these assessments and announce new programs when we see it.

Okay. That's very clear. Just on the personnel cost division. So is it just fair to assume that when you have like a rate hike, that most of the benefit just comes in the personnel cost rate segment, and we should expect less benefit in the other segments or kind of maybe if you could just talk us through how we should think about the NII improvement that we will see again in Q4 from the repricing?

Yes. Well, what we can walk you through, Sofie, is the structure of our portfolio. And of course, it's primarily the personal customers that have the floating rate priced loans, namely the mortgages, where more than 90 -- I think more than 95% of the mortgages are based on a floating rate basis. And here is where we adjust the prices.

And then you have excluding the real estate book in corporate customers Norway, I believe it's 30% of the loans towards SMEs that are also based on the floating rate basis. loans in large corporates are priced on reference rate plus a margin. So a rate change will not impact them. And then, of course, it's also the impact on the deposit side, which is primarily also personal customers and corporate customers Norway.

As for -- so on the NII effect, this would impact the numbers. As for internal pricing, I mean, there's no transfer pricing as such, but of course, there is an element of funding cost for the business areas and personal customers is charged sort of the money market rate when we look at their margins on the loans and also then the NII. The additional element to keep in mind is that higher rates leads to an improved revenue for the equity that they deploy in the funding. So in such a manner, there would be a share of increased interest on equity in large corporates.

Next question be coming from Riccardo Rovere of Mediobanca.

A couple, if I may. The first one is on loan growth. Q2 was -- well, in your fact book, you show the average lending volumes by division, which is helpful, I have to say. Now in Q2, it was stagnant, more or less in all the various three divisions. Now as big -- in Q3, it seems to have picked up again. So the question is, what Q2 normally or is Q3 the anomaly?

The second question I have is I know you will never ever provide any guidance on this. But just as a qualitative statement, Three months a little less than three months after the first rate hike, do you see any big difference in respect of the previous tightening cycle when it comes to passing rate hikes on to the customer base?

On your question on loan growth, Ricardo, we invite you to think of it differently with regards to the growth in personal customers versus corporate customers Norway and large corporates. Personal customers, there's more of a gradual growth. I believe the growth in the second quarter was 0.3%. This quarter, it's 0.4%. And year-over-year is 1.4%. So slightly less than the market. But again, we are very pleased to see a growth of that level in such a competitive market.

And keep in mind that our customers are enticing. So a number like that actually means quite a lot of customers coming into into the bank as new customers. Corporate customers Norway now also contains the portfolio on commercial real estate. That portfolio is somewhat down, and it can vary from quarter-to-quarter.

If we look at the broader SME portfolio that sort of reflects the level of activity in the Norwegian markets. The growth has been more in the area of between 3% and 4% if we look over time. This is a bit low in a longer-term historical context because one of the important elements of this portfolio used to be the construction finance, and that has been very slow now for several years. This used to add approximately 3% volume in terms of short-term borrowings on to this portfolio.

So you can say, adjusting for that, it reflects the level of activity across SMEs of 6%, which is a very healthy growth level. We do expect the construction market to come back. We have been expecting it for some time. It's still too early to say actually when it will start to materialize.

Now large corporates can be much more bigger variation from quarter-to-quarter. This depends on the actual deals that are being done, there is a rapid turnover of the capital in the portfolio. This duration of that capital is approximately two years, which gives you an idea of actually how quickly that portfolio is turned around. The growth this quarter was 3.4%, if we do not adjust for the currency and growth year-on-year is 10.8%. So all together across the platform, we delivered a 5% growth year-on-year. And this is exactly how we think about our platform and talk about it that we can balance across the different parts of the business in order to grow profitably. We're saying 3% to 4%. But also, of course, we are showing you that if we can grow a little bit faster and we can do so profitably, we are more than happy to do so.

As for your question on difference in terms of passing on rates. I'm not sure I can actually give you any more color than we already gave when we announced the price increases where we said we have adjusted prices by up to 25 basis points, both on loans and deposits. And again, I referred to Rasmus' comments earlier today on the press conference, where he invites you to look at both the changes on the spreads as well as the interest on equity to gauge a picture of the repricing effects on the net interest income.

And just to get back one second to the first question. So from what I understand from your wording, I understand that the 3% to 4% loan growth in your mind, that number is still valid. Do I get it right?

Yes. Still valid.

Next, we go to Namita Samtani, of Barclays.

My first one -- thanks for your comments on products per customer DNB. I just wondered how do you see competition for deposits just more broadly as AI makes more of an impact, which could make the more highly remunerated deposits across different competitors more transparent to customers. Just wondered if you're taking any initiatives that to protect your deposits.

And secondly, just on expenses, I noticed line -- employer's national insurance contribution that's up 15% year-on-year. So I just wondered driving that? Or if there's any reclassification there? And then just lastly, rate to Norway at 4.5%. How do you see corporates responding to that in terms of the appetite to borrow with rates being quite elevated?

Thank you, Namita. I will try on the first and third, and I'll leave the second one to to Rasmus. I think a relevant question on AI. I mean we've been talking about news as the most successful, I would say, AI agents so far to consumers, and we are preparing for a changed competitive environment through investing into our platform, building loyalty, we see that -- and we have been doing so for years. I mean we have half the Norwegian population actually actively using our banking app while only having 1/4 of the population having mortgages with us.

So the loyalty and brand value is important, and Maria is also working on launching AI features directly towards customers. So this is a scenario that we are preparing for there. We will see -- we will have to see how this plays out in terms of regulatory environment. I think that is yet to be seen. And also also authorization through bank ID and other verification. So I would say that we see that this is a trend. It's still uncertain how large the impact will be and how fast it can possibly go, but we are also preparing to compete and to continue to earn the customers' trust and have their loyalty.

Would you like to add, Maria?

No, i think you have covered it.

I covered, Okay. Good. I'm learning from Maria. 4.5, I wouldn't say it's restraining appetite for corporates to lend, but we can see in the market that some businesses decide to postpone investment decisions. I would more lay that on the broader uncertainty in the global environment, if this is related to companies involved in export activity and actually to the interest rate level as such.

The cost question, on implores national insurance contributions. This is a technical adjustment in Q3 and it's the -- it's done for the year-to-date figures. So we are expecting a negative delta in Q4 on the figure.

Next, we'll be going to Isabel Hetrick of Atomos Research.

It's Isabel Hetrick from Autonomous Research. I have two questions, please. So my first, we can see group asset management net inflows have clearly taken a large step up in the last two quarters. And so could you just provide some more color here about what's driven that change? What customer segments and markets and are there any internal actions you've taken that you think have influenced this? Whether that's new product launches, cross-selling initiatives, any big mandate wins?

And then my second question is on Investment Banking fees. I know your comments at the start of the presentation that you saw some slippage from 2Q. But could you provide some color as to what the pipeline looks like into year-end? And how do you think recent market volatility and maybe fears over fiscal sustainability, AI bubble is influencing market behavior here?

Thank you, Isabelle. In AUM, we are very pleased with the development, not only in the past two quarters, I would say, but also now for a series of 5, 6, 7 quarters in a row. And I think I would like to say that we have worked with a series of initiatives over time that is now paying off. First of all, in relation to this quarter and the previous quarter, I should highlight that there is one big mandate win in these numbers. So a single institutional investor that provided a flow of NOK 30 billion in the third quarter and NOK 30 billion in the second quarter.

But even without that, the flow has been positive with more than NOK 20 billion. And this quarter, the flow from retail investors was NOK 6.5 billion, and I think not too far from that also in the second quarter. And this has been a clear strategy on our side to prioritize the more sticky and higher-margin volumes under management.

One area that we have pointed to is the savings agreements with our personal customers. This is at an all-time high. They are now saving in their savings agreements more than NOK 1 billion a month. We also have a market-leading position in defined contribution that we have baked over time. And of course, there, the companies are paying down more money into these funds for their employees on a monthly basis. And we have scaled the pace of innovation, I would say, onto our digital platforms, both the savings specific platform that we have, but now also increasingly integrating the savings products into the mobile banking platform now that the position has been built.

Beyond that, we are continuing to advise on an individual basis, but also on a collective basis. And this quarter, we've had a lot of conferences under the umbrella she invests across the country to talk about savings. There's a lot of young women mostly, but young people that are coming to these conferences, and this has also created a community in social media where people are increasingly engaging in savings. And such, we are actually working on the big potential we've talked about that Norwegians while more active than not European, they are still not as active as the Swedish people in terms of savings into mutual funds.

So this is a series of activities that has led to increased inflows in funds, but also stable margins despite the trend from active to index and also the trend with pressure on margins from from certain reforms in the past, whereas we have seen very stable margins over time in our assets under management business. In terms of investment banking, I will start and hand over to Alex also to talk about the sentiment in the market, given what we see today.

Third quarter, again, I reiterate a very strong quarter with many large deals. I also made the comment with some of these deals being done towards the end of the second quarter and booked in the third quarter because it is an exceptional quarter being a third quarter, which is usually a bit slower. This was an all-time high revenue in terms of bonds for DNB market. And I would describe the pipeline as strong and invite Alex to put his comments on it. But of course, we had a very strong fourth quarter last year. So I'm a little bit also alluding to the the pace of growth from third quarter to fourth quarter that you should bear this in mind that the third quarter was exceptionally strong when you think about how this goes forward.

Thanks, Kjerstin. I can provide some extra color. It's about -- if we start with the third quarter, as you pointed to Justin, a few transactions closed in July. That was for the majority executed throughout the second quarter. But that being said, it's still quite broad-based. No sort of single fee event is more than still single digit of overall fees within Investment Banking. And maybe also point out that so far this year, about half of our, say, top 10 mandates are north mandates and most are outside of our traditional stronghold market of Norway.

If we look into the fourth quarter, clearly, with the sort of market volatility, we do see the IPO pipeline being pushed out somewhat and a bit slower market sentiment on the more risky credit side. But the pipeline remains strong, and it's more of a timing question than any type of mandates being canceled.

Our next question coming from Rebecca Ken of Bank of America.

This is [indiscernible] from Bank of America. I have two questions. So one is regarding your new rate [indiscernible] business, you mentioned about competitive list, not worsen in Q3 versus Q2. If I just desperate was down and -- sorry, it was more pressure than entirety, given we saw another rate hike in late September, this comparison situation did not change in Q4. Should we expect a similar direction of travel for both lending spreads and deposit spreads in Q4? Therefore, further NIM expansion in your personal banking in Norway. So that's my first question.

Okay. A little bit difficult Yes. Okay. So ahead if you want to do.

Yes, sure. So my second question is also related to Corporate Finance. You mentioned there was some delay from Q2, but if we exclude that impact, have you observed any structural changes in terms of consolidating [indiscernible] therefore, further penetration across Nordics were just more deals in Finland and Denmark where [indiscernible] have picked up?

Thank you, Rebecca. I'll answer the first one and introduce slightly the second one and leave that one to Alex. But with the subject of it being slightly difficult to hear what you asked in the first one, I will try to answer as best I can, and then you follow up if you don't feel that we are hitting what you were talking about. Again, with regards to the competitive landscape, I reiterate that the competitive landscape is unchanged largely. And as fierce as we have commented upon before, comment that was made during our press conference today was that the impact on our numbers as such were slightly less than what we saw in the second quarter.

In other words, is more a comment as to how we are managing the environment and our ability to continue to grow in all the sectors across the business, while also being mindful and disciplined about how we allocate capital. there is a meaningful impact on our NII and thus margins then from the repricing that took effect mid-July. We haven't specifically commented as to the size of the impact of this beyond referring to historical rate hikes where the impact from a 25 basis point rate hike or rate cut has been in the area between NOK 800 million and NOK 1.2 billion.

Now with regards to future margins, we are not commenting or guiding specifically, but of course, we can talk about what we know and we know that we have announced the repricing towards our customers on the floating parts of our portfolio, that we have repriced loans and deposits by up to 25 basis points, and that will take effect in the end of November. So everything else equal, this will have a positive impact on our NII. And then, of course, there are other impacts such as market development, growth, substantial portfolio mix effects and also FX, which are the typical elements that you follow and think about in order to assess the future developments.

With regards to corporate finance, I will hand directly over to Alex.

Thanks, Kjerstin. So if I heard the question correctly, there's no sort of structural changes in the market that I would point to. But in terms of sort of the combined in the Carnegie platform, we do feel that we have sort of a very competitive offering in the marketplace, and we feel that we are more relevant to clients than ever.

Are we performing at potential yet? I would say that there are -- there's still upside ahead. We've only operated together for five full quarters. And -- but we're also then communicating now that on the investment banking advisory side, sort of all the integration is complete. So we are entering a phase where we are less internally focused, and that's sort of contributing to good client dialogues.

Our next question will be coming from Ricardo Rovere, calling from Mediobanca.

A couple, if I may. The first one is on risk-weighted assets, pretty flat quarter-on-quarter. Just wanted to be sure that, is there anything with regard to models approval, recalibration, reassessment that we should be aware of when it comes to your IRB models, given that this has been a pretty hot topic over the past week or so. The other question I have is the amount of bond in general, medium, long-term funding on your balance sheet has gone up quite significantly in the quarter. I was wondering if there has been any kind of prefunding activity in the quarter expecting higher rates in the coming quarters? And then maybe just a quick follow-up. In my understanding from all the comments that have been made on investment banking, point to a sort of -- I don't know how to say sort of maybe a little bit super normal this quarter, if I understand it correctly, I'm not sure this is the message you want to convey. But if this is the message you want to convey has this affected more fee income or trading or both of them?

Thank you, Ricardo. RWA is fairly flat. There is some capital being reinvested into the business for the growth that we are delivering in the quarter, but nothing in particular to highlight with regards to structural changes or migration or shift in the portfolio to speak of. I hear that you also referred to discussions we know have taken place around other institutions during these earnings seasons and the message from us is that we have nothing in particular new to highlight this quarter with regards to our dialogues or models or other with the FSA other than to say what we would say every quarter that there is a continuous and ongoing dialogue with the FSA on these and other elements. And you know there are moving bits and pieces in the capital stacks, such as the Pillar 2, and [indiscernible] process that we often referred to. On the investment banking, there was no intention from my side to talk about a super normal quarter. I just highlighted the fact that the third quarter usually is a more quieter quarter, and that the results were very strong this quarter. But again, to reiterate what Alex said, the revenue is diversified across products, across customers and across geographies.

So there is a sound distribution of revenue. And my comment was more to point to a direction in the future where we say that the pipeline is strong. But given the nature of this business, there shouldn't be sort of an automatic extrapolation either. I think that is all that we tried to means without signaling strongly that there was anything unnormal about what we saw this quarter. And Rasmus, on the funding.

Yes. DNB is fulfilling all MREL requirements with good margin. Well, the stronger -- no currency in Q2, we reduced the value of our outstanding [indiscernible] debt in currency. So as a result, we had to accelerate some transactions planned for the second half to secure sufficient MR buffer. And it did influence long-term funding costs somewhat negatively.

Rasmus, these transactions have been put in place at the beginning of the quarter or end of the quarter or throughout the quarter?

There's no one specific. So I would say throughout the quarter, if anything.

We do not appear to have any further questions at this time. I'd like to turn the call back over to Mitra for additional or closing remarks. Thank you.

Everyone, thank you for joining today's call and for your questions. Should you have any further questions, please don't hesitate to contact [indiscernible] myself. Have a good day.

Thank you very much. Ladies and gentlemen, that concludes today's call. We thank you for much of your attendance. You may now disconnect. Have a good day, and goodbye.

Good morning, everyone. Please find a seat, and welcome to the presentation of the third quarter for DNB. A very warm welcome to all of you in the audience who is here physically, and also welcome to everyone following us on the stream, either you're working from home or abroad. There will be time for questions after the presentation, and there is also an opportunity for journalists to talk to management after this session. So with no further ado, I will leave it to you, our CEO, Kjerstin Braathen. Please.

Thank you so much, Even, and a very good morning to all of you, and welcome to the presentation of our third quarter results. It's been yet another active quarter even with the holiday season finding itself in the midst of the third quarter. We have seen a strong activity across the business and the robustness of the Nordic economies is underpinning these activities. We're also very pleased to see that we are making progress in our Nordic growth strategy. It is a fact that the environment globally outside the Nordics continues to be volatile, but what we've also seen is that the investment cycle in technology and notably AI continues through the quarter. And we also see technology as a key driver together with our people in the transformation of our businesses and our ability to create enhanced customer value.

Overall, I am, as always, very grateful to our team who work relentlessly every day and their collective efforts to deliver value to customers and also deliver the results that we are presenting to you today. Our mission is to simplify life for people and businesses and help them prosper. And as I've done in the previous few quarters, I would like to start with a few highlights and examples on how we do exactly that. We are increasing artificial intelligence in our integrating -- we are increasingly integrating artificial intelligence in the offering to our customers and thus increasing the value of what we are delivering to them. One example is how we implement these in Know Your Customer processes to make them smoother and avoid asking the same questions to customer several times. Another is by a faster and smoother onboarding experience for customers and overall improving customer journeys across the businesses.

We believe that this is also what is visible in the feedback that we are getting from our customers, and we are motivated to see that many of them report back to us that they are increasingly happy with our services. One of the highlights this quarter is to see Sbanken back up at the levels they were before integrating services into the business. And we also see an all-time high level of satisfaction from the smaller business clients. We continue to see a broadening of our offering and services in savings and investments. This is an area where the pace of innovation, as I've seen it, has gone up. And this is one of the drivers resulting in an all-time high level of net flow into the asset management business this quarter and a meaningful contribution from retail customers, fortifying our position as a leading asset manager in the Nordics.

Lastly, a word on Montrose, which is our challenger savings app for retail customers in Sweden. One of the news from them this quarter is that they were the first one in Europe to launch an MCP integration. That means that they are enabling customers to integrate their portfolios directly into AI assistants such as ChatGPT and Claude to get personalized insights. An example on how we are also supporting competing initiatives because we strongly believe that competition is also what makes us all better in terms of delivering to customers.

Turning to a few highlights on the numbers we are presenting today. Return on equity comes in at 14.5% for the quarter. Adjusted for the Luminor transaction, where our part ownership of this bank has been announced in a sale, return on equity is 15.5%, both well above the hurdle of minimum 14%. The profit for the period is NOK 9.8 billion. Our NII is up by 2.5% compared to the previous quarter, reflecting growth in lending across all key business areas of the bank. One of the strongest points this quarter is net fees and commissions, up 14.6% from the third quarter last year. And a few areas to highlight yet again this quarter is Investment Banking and Asset Management, both up, respectively, 39% and 12% from the quarter -- from the same quarter in the prior year.

Again, net inflows in assets under management, NOK 54.5 billion inflows this quarter, fortifying our position in this area. Our portfolio remains robust, well diversified. Impairment provisions this quarter of NOK 529 million, but we continue to see 99.4% of the portfolio in Stages 1 and 2. Our capital position is strong, 17.3%, which means 100 basis points headroom to the required and expected level from the FSA. And this number also includes the deduction of 30 basis points related to the share buyback program that was announced earlier today. These solid results, results in an earnings per share of NOK 6.57, which would have been NOK 7.07 if we adjust for the Luminor, which is more of a one-off nature.

We are growing, as I've said, our activity across the Nordics, but Norway remains our largest market. And as such, it is the Norwegian economy, which is the most important for the development of our business. If we look at the outlook for Norway, GDP is expected to come in at 1.1% this year with an uptick towards 1.5% in '27 and the following years. The labor market continues to be balanced around 2% unemployment and the outlook for this market is stable. Inflation has come down from the higher levels in previous years. But as stated also by the Central Bank, the tail towards the 2% is stickier and harder to get. This is also what has led to the Central Bank hiking rates on 2 occasions earlier this year, which has led to a key policy rate now of 4.5%.

The market expects a few rate cuts in the future as inflation is expected to go further down. And the timing of this is now in the second half of 2027, if you look at what the market is expecting. So we do note the volatility in the world around us, but the Norwegian economy remains resilient and the outlook is also a solid basis for our business outlook ahead. I would like to share a few highlights from our main business areas and their developments. Growth in the past year has been profitable across business areas of 5% in total. In personal customers, we continue to grow. At the same time, we see that our customers are increasingly satisfied. We see this, again, as a result of deploying AI to simplify product and processes. And it also makes our people better and more targeted advisers to our customers.

Costs are stable, and the team is performing well in what is still a competitive market. There is a high level on savings, which I've alluded to under net flows in asset management, but there's also a high activity level on savings where this quarter, we have arranged investing seminars under the umbrella She Invests across the country. It's full every time. And the revenue in savings, long-term savings in mutual funds in the personal customer segment is up by 21% compared to the same quarter last year.

Corporate Banking delivers a growth year-on-year of 6.2%. Pretax profit is stable, a lower contribution from net interest income, but a higher contribution from net other operating income, which we are pleased to see and is a result of, amongst other, that the cooperation is increasing between Corporate Banking and DNB Carnegie, where there is a decent uptick in revenue compared to last year.

Large corporates, this quarter and the last year is delivering as a key part of our growth platform, 10.8% growth over the last year, a pretax profit that is 13.4% higher than the third quarter last year. Our growth is broad-based across both geographies and industries, and the portfolio remains robust and well diversified. Our Nordic strategy continues to gain traction. We have 50 new customers in the Nordics outside of Norway so far this year and 35 of them from Sweden. And the revenue from the cooperation between DNB Carnegie and large corporates this quarter is up by 32% compared to the same quarter last year.

Lastly, I would like to this quarter to mention Fremtind, the non-life insurance company that we own with 28.5 percentage points because they are delivering very strong results. For us, they are contributing both in the net commission and fee line under insurance, which is up compared to the same quarter last year, but they're also contributing as an associated company and their results are solid and high, reflecting both growth but also substantially improved profitability in the business. So I wanted to give them a shout out also for this quarter. And with that, I will leave it to our excellent CFO, Rasmus, to take you through the details.

Thank you, Kjerstin. I will now take you through the third quarter results in more detail. We see continued high activity in the customer segments with FX-adjusted volumes up 1.2% in the quarter and 5% year-over-year. We note profitable loan growth in the personal customer segment of 0.4% this quarter. Volumes in both Corporate Customers Norway and Large Corporate International were up by 0.8% and 3.4%, respectively. Growth across all geographies and industries. And geographically, we continue to see that more than 50% of the growth in large corporate and international is outside of Norway, primarily also in the Nordics. The 3% to 4% annual growth ambition is defined at group level. We remain focused on capturing attractive growth opportunities while maintaining a disciplined approach to risk and return.

Currency-adjusted deposits are down by 1.9%. The decrease of 1.2% in personal customers are driven by seasonality, whereby customers gradually spend their annual holiday paid out in June throughout the quarter. The reduction is, however, lower than the corresponding quarter last year and should be seen in combination with the strong inflow in assets under management. Corporate customers Norway was down 6.3% due to seasonal fluctuations in the public sector as well as reductions within organizations. Both sectors carrying lower deposit margins. Volumes, excluding the public sector and organization and thus reflecting the breadth of the Norwegian corporates was up by 2.9%. Volumes in large corporate and international was up by 1.1%, and we remain having a strong deposit to loan ratio within the customer segments of 71.6% this quarter.

There's positive development in the net interest margin and customer spreads that reflects the profitable growth and customer repricing. The net interest margin was up 1 basis point to 171 basis points, and the combined spreads were up by 2 basis points. Both lending and deposit spreads have lag effects related to repricing and should be seen in combination as illustrated in the combined spreads. Moving on to the NII development, where we explain the effects in more detail. The net interest income was up NOK 372 million in the quarter. Spreads are up by NOK 173 million and should be seen together with a positive contribution from interest on equity of NOK 71 million to see the full effect of the repricing.

Customer repricing effects was the main contributor to increased NII this quarter. We also note positive deposit mix effects, as mentioned previously. The pressure on margins due to competition was somewhat lower than in the previous quarter. Higher average volumes during the quarter contributed NOK 58 million, but we note that volume growth picked up late in the quarter. One extra interest day amounted to NOK 115 million. And following the Central Bank's rate hike of 25 basis points in September, we announced the customer repricing, which becomes effective on November '29, impacting NII positively in the fourth quarter, together with the full effects of the repricing announced in July.

We have a strong and well-diversified fee platform, and I'm very pleased to see growth of 14.6% from the corresponding quarter last year. Investment Banking Services was up by 39%, and we note particularly strong within -- results within Investment Banking, which was up by 57.4%, driven by ECM, DCM and M&A. We also saw a strong contribution from our Nordic platform on this line. Asset Management and custodial services was up by 13%. And as mentioned, we know an all-time high net flow of NOK 54.4 billion in the quarter, of which NOK 6.8 billion came from the retail customer segment. NOK 30 billion of this quarter net flow was driven by single institutional clients. Assets under management, up NOK 68 billion from the second quarter, resulting in a total asset management of NOK 1,849 billion this quarter.

Money transfer and banking services were down by 9%. We did see seasonally higher activity related to card payments with travel on our customers' summer holiday season, offset by costs related to credit insurance as mentioned previously, assisting on the originate and distribute model within LCM. Sale of insurance products was up by 16%, as highlighted by Kjerstin previously and mainly driven by positive development in defined contribution pensions as well as increased income from non-life insurance. We continue to work diligently on our cost base, which was down by NOK 355 million compared to Q2. Contributors were market effects on closed defined benefit pensions and seasonally lower activity.

Increased IT cost was partly due to data centers and AI expenses. Fixed salaries are down by NOK 86 million, reflecting our continuous work on increased efficiency within the corporation. Variable salaries were down compared to Q2, but up NOK 58 million compared to their corresponding quarter last year, reflecting the higher activity than typical Q3 in DNB Carnegie. We remain committed to delivering on our cost efficiency as highlighted by our recently announced staff reductions.

Now over to portfolio quality, which remains robust and well diversified, stable from last quarter and with 99.4% being in Stages 1 and 2. The personal portfolio -- customers portfolio constituting 50% of our balance remains strong. And we continue to see benign levels of interest-only applications and past due payments.

For Corporate Customers Norway, the impairment provisions totaled NOK 287 million and the increase in Stage 3 impairments was related to customer-specific events. The portfolio remains strong and well diversified across industries and geographies with no structural changes or negative migrations to note. And we remain comfortable with the overall credit quality in the portfolio.

Now moving on to capital. Our CET1 ratio remains strong at 17.3% with 100 basis points headroom to the regulatory expectations. The CET1 was positively impacted by profit generation in the quarter, which was partly offset by a higher REA driven by volume growth. We've completed the 2% share buyback program under the current Annual General Meeting authorization and today announced a new 0.75% program, impacting CET by 30 basis points.

Leverage ratio remains strong at 6.3%, well above the regulatory requirements of 3%. Our capital situation in sum remains strong and enables us to continue to deliver on our dividend policy and support our customers in times ahead. Summing up, we delivered a strong set of results in the third quarter reflected in our key figures. Return on equity came in at 14.5% and compensating for the sale of Luminor would have been 15.5%. Cost-income ratio at 39.8% and earnings per share was NOK 6.57, summing up for the year so far, NOK 19.58 and with Luminor compensation on pro forma, it would have ended up at NOK 7.07. Before we open up to questions, I would like to invite you all to our Capital Markets Day at our offices in London on November 10. Thank you.

Thank you so much, Rasmus and Kjerstin. We will open up for questions. Yes, Simon from ABG here in the front.

Simon Brun, ABG Sundal Collier. Just firstly, a question on the competitive environment in the market. Rasmus, you mentioned that it has been -- or maybe for Kjerstin, I don't know, that quarter-on-quarter, the competitive environment has eased somewhat. Can you elaborate on that? Is that sort of broad-based across both the customer segment and commercial? And are there still sort of -- are there any changes relative to if that is smaller Norwegian banks or larger Nordic banks, one of which alluded last week that the competition is intensifying?

Thank you, and thank you for asking that question. We see no material change in the competitive landscape and are merely commenting on the impact into our numbers and how we are continuously showing a disciplined allocation of capital and balancing growth and profitability. So indeed, we see that our offering is attractive across customers in personal customers and SME and medium-sized enterprises, but these continue also to be the areas where competition is the most intense. But we're also pleased to see that the development is healthy in both the NII and the growth this quarter.

And secondly -- on taxes, in your notes, you referred to disagreement or dispute with Norwegian tax authorities about the paid tax for 2019 to 2023. Can you just share some additional thoughts on how we should think of that and if that is -- will be a lengthy process going forward?

It already has been a lengthy process. It's been ongoing for several years, and we have highlighted this in our annual reports as it progresses. The new, should I say, information on this is that they've added 2 more years on their assessment on this transfer pricing tax issue. So this is a well-known tax issue to us. There is ongoing dialogue, and we expect it to also proceed for a while. And there is no change to our fundamental assessment on this matter. And as such, we have not made any provisions on this tax effect.

Thomas Svendsen from SEB.

A question to the asset management operations and sort of the massive flow of funds, both in this quarter, but also in Q2. So I think -- are you taking market shares? Are you working in a different way? How are the margins on the new business you get on board?

Thank you, Thomas. We've highlighted this quarter and last quarter that there was both of these quarters, a large one-off placement from 1 institutional investor with a limited sort of contribution to the margins, but a considerable contribution to flows. The amount was approximately NOK 30 billion this quarter and the same last quarter. But still even beyond that, there is a very high level of inflow. Whether we're taking market share or not, I haven't checked. We also have increasingly a diversified sourcing of funds and 25% of the flows outside of this 1 placement from a single institutional investor stems from outside Norway, 25% stems from outside Norway.

NOK 6.5 billion from retail customers. So we continue to see a high level of savings, which is also what contributes to what I said in personal customers, a 21% growth in earnings from this area in the last year, but a healthy flow across the board. And I know there have been others who have reported recently, so you're probably better positioned than I to gauge the relative performance. But to me, it looks pretty strong.

Just a second question on costs. You talked about new technology, AI, et cetera. So which customer segments or functions in the bank do you see the biggest upside -- efficiency upside from introducing new technology?

I think as a general note, we think that AI is transformational, and we think it's transformational to many industries, if not all of them. So that means that there are opportunities to work differently and to enhance customer offering across all of the areas that we are working. But if you look at where we have done the most so far, which we have commented on previously, it's been in the areas related to KYC, which is also partly what we announced in the restructuring recently where we are reducing the number of employees.

It's also from chatbot services and improved customer service in our call centers, enabling our advisers to better help customers, which is why we also see, yes, a more efficient operation in this area, but also more happy customers. And the third area that I would highlight is the efficiency in coding where our technologists and developers are now more and increasingly supervising agents writing the code and actually writing the code themselves. We are well underway on this journey, but we will continue to -- and we do work also across the bank in other areas where this will lead to improvements and enhanced value for our customers.

Thank you. Any questions -- further questions? We have 1 question in the midst on that side.

Yes, Felix Sandblom from BearingPoint. I just wondered now that interest rates are returning back to 2024, 2025 levels, do you expect profitability to go back to the same levels as we saw in these years?

We have a very clear sort of financial targets on profitability as such, and we deliver in line with that, which is minimum 14% for this quarter. And we've also announced some decisions that have been made in the aftermath of the interest rate levels. But as we always do in an environment where there are different moving parts and pieces for every decision we make, we will consider, of course, the rate levels in the market, the competitive situation around us and any other relevant circumstances. So across the business, where it's important also to highlight that 2/3 of our revenue and activity stems from other areas than personal customers. But across the whole of the business, we work to grow profitably, but also to grow our fee-related business more than our lending. And with that, we are strongly committed to delivering on more than minimum -- more than 14% return on equity.

And another question since the others also asked 2. The stock market is very exuberant at the moment. And if there was a correction of, let's say, 30% to 50%, which has happened several times in history, what -- how would that impact DNB?

I think a correction of 30% to 50%, yes, it has happened, but it has happened rarely in the market. Of course, we are mostly impacted by the underlying investment activity and the cash flow and results from our customers in relation to the lending activity on the business. What we would expect if the markets were to correct substantially would be somewhat lower activity across some of the investment banking areas. Generally, IPOs tends to dry up if that is the impact. And debt investor tends to be more cautious and activity lower in bond markets, particularly in high yield. And of course, it would impact our asset management business. Again, the last point that I would highlight is in a world where volatility has been higher than what we've seen prior to the past 5 years, we remain in one of the most robust, if not the most robust economy and economic area in the Nordics in the world to deal with any turmoils.

Thank you. If there are no further questions in the audience, I'd like to take the opportunity to introduce our new Head of Investor Relations, Mitra Hagen Negard, who is sitting here in the front? Are there any questions from the online audience? Then please give her the microphone.

The first question is from Martin Ekstedt in Handelsbanken. Should we take the new buyback program of 0.75% of shares outstanding versus the previous program for 1% initiated in July to mean that you are setting a lower pace for buybacks? Or will the new program be executed over a shorter time period than the previous one?

Thank you. Our capital allocation commitment remains strong that we will disburse excess capital back to our investors. And as such, with a smaller program, the period of buyback is expected to be shorter, and that's what should be read into.

I have another question.

Please go ahead.

Alexander Larstedt Lager from Arctic. As last quarter, you mentioned large AUM inflow from 1 institutional client. Can you give me more details on this?

We have -- we've talked about also that this quarter with a similar amount. We have no other details rather than other than saying that this is from 1 institutional investors and as such a low margin contribution, but a very sound inflow in terms of volumes.

I will proceed. Two questions from Sofie Peterzens from Goldman Sachs. The first one, in Q2, DNB said competition and mix change weighed on NIM, net interest margin, by approximately 1.5 basis points each. What was the impact from competition and mix change this quarter on NIM?

We haven't been specific about the impact beyond saying that it's a lower impact this quarter compared to last quarter. Again, reiterating my response to the important question that was mentioned, we are, by saying that, not signaling a substantial or material change in the competitive environment. It continues to be fierce. And we also continue to monitor and balance our growth and profitability throughout the business.

Thank you. Her next question, when do you expect the tax dispute to get resolved?

We have no clear time line on that. As mentioned, that this proceeded already for several years, and these processes usually take a very long time.

Thank you. No further questions on the web.

No further questions. Okay. I think that concludes this session. Let's hope the scenario from BearingPoint doesn't occur. And let's all have a good Wednesday. Thank you all.

Hello, welcome to the DNB Q2 conference call. My name is George, and I'll be your coordinator for today's event. Please note, this conference is being recorded. [Operator Instructions] I'd like to hand the call over to your host today, Mr. Rune Helland, Head of IR to be [indiscernible] this conference.

Please go ahead, sir.

Thank you very much, and hello, everyone, and welcome to DNB's Second Quarter Analyst Call. And here also to answer all your questions, we have in addition to Kjerstin and Rasmus, we have Maria [indiscernible] from [indiscernible] Corporate Banking, Norway, [indiscernible], MCI, Alex; and [indiscernible]

Before we open up for questions, Kjerstin will give you the highlights for the quarter.

Thank you, Rune, and thank you all for taking the time to be with us today. Just a few highlights on the quarter that we believe is a good quarter, demonstrating high activity across all of the business areas with also DNB Carnegie and Wealth Management as the strong drivers on the fee side. The backdrop of all of this is a very resilient and robust Norwegian economy that continues to demonstrate the same, even though there are still turbulences in the world economy and the Middle East around us.

We continue to see a sound development, continue to expect the GDP growth in the mainland economy of 1.5% and continue to see low unemployment. As you probably already have noted, there was an increase in the key policy rate by the Sun Bank during the second quarter and expectations of one more, most likely in the third quarter of this year before the key policy rate again is expected to come down in the second half of 2027 to stabilize around the level of 4%. So resilience in the economy as previously indicated and a sound growth level driven by consumption as well as a high savings rate among the population.

Coming into key specifics of our numbers this quarter, we delivered a return on equity of 14.6%, growth in both fee-related and interest-related activities are the drivers for the results. You may have noted that our net interest income is down by 1.1%. So the growth is offset by some elements of competition and product mix effects. To be more specific, if you look at the spread development, net of revenue related to interest on equity and treasury elements, it's a reduction of NOK 264 million, which is evenly spread among product mix effects as well as competitive pressure. It's also worth noting that the volume growth that comes primarily in corporate customers, Norway and LCI comes towards the end of the quarter. And as such, the average volumes are down or stable, I would say, in the quarter, whereas the end-of-quarter numbers shows a growth of 1.4% for the group as a whole.

Net commission and fees up by 4.6%. Key drivers, Investment Banking where corporate finance growth by close to 20%. The other strong driver for growth is Asset Management that is up by 13% with a record [indiscernible] A very robust development of...

[Technical Difficulty]

Ladies and gentlemen, this is the operator. We appear to be experienced temporary interruption to the conference. Could you please stay connected and we'll wait for speakers to read out. Please do stay connected, do not hang up.

I believe the speakers have rejoined.

Yes. We can hear you now.

Okay. Could you please proceed the [indiscernible] drop about 3, 4 minutes ago?

So proceed, have they gotten the highlights?

It was the lady with speaking, sir, and it was before we went to Q&A.

We should just continue with the Q&A?

Well, if you want to pursue the highlights again or do you want to go to Q&A sir?

We're asking if the highlights were heard or not.

In part, you were speaking, then the line went silent.

Okay. Approximately at which point, would you be able to share that? So I don't do a repeat of the whole thing.

I would say you're safe about 3, 4 minutes into it?

We'll go directly to the Q&A. It's all available anyway.

Let's go just directly to the Q&A.

Our first question today is coming from Shrey Srivastava of Citi.

This point has come a bit earlier than I expected. My first question is on the competitive dynamic in the large corporate segment. I understand it's the margin decline this quarter is to do with the mix of the business and you are pursuing, but it's clear, not only from yourselves, but also from what your peers have said that, that environment is becoming increasingly more competitive. So is there anything you can share on the outlook going forward?

For margins potentially across the Nordics, as you particularly highlighted outside of Norway. And my second one is, you've seen an interesting dynamic where you obviously have this pressure on margins in personal customers, but you also have this very, very strong flow dynamic as well. But obviously, that's margin dilutive since you've learned a lot more on deposits certainly current accounts. So I just wanted an update sort of from a sector perspective on how the customer is thinking about the decision between sort of deposits and fund savings and how it affects your sort of margin outlook [indiscernible]?

Thank you for your questions. As a general statement, I would just reiterate that we do see and live with competitive pressure across all the parts of our business. At the same time, my assessment is that all of the areas is managing this competitive pressure in a very rational manner, and we can confirm that the growth that we take on our books also in this quarter represents profitable volumes to the bank.

And just to reiterate the movements in NII, when you consider the movements on spreads, you have to look at a movement net of increased interest on equity and treasury, which leads NOK 284 million as a movement and approximately half of this is related to competitive pressure. So approximately 1.5 basis points across the entire book.

For large corporates, in particular, when asked and Harald, he can develop if he feels like it. But we are winning transactions, not purely on price. We are winning transactions on areas where we have industry expertise, where we combine this with products and services on the advisory side from DNB Carnegie or in other areas such as commodity derivatives or trade finance or value chain, supply chain -- supply value chain financing were areas where we find that we have differentiating offerings to competitors.

So we are talking about part of the product mix effect coming from the fact that the growth being delivered this quarter in large corporate comes from lower risk volumes than we have in average on the portfolio. This can be seen twofold in our numbers in other areas. One is through then a positive migration and a lower share of high-risk exposures in the LCI book.

Secondly, through the fact that the growth is capital efficient this quarter, a 3% growth in large corporates, but only a 20% sort of consumption of capital net of migration and other instruments applied to increase efficiency of the growth. So again, these are lower margins nominally, but profitable to the bank.

In relation to personal customers, if you look at the segment in isolation, there are lag effects stemming from the movement in the money market rates coming prior to actually the rate hike from the Central Bank in expectation of it and then a notice period after -- from the repricing being announced up until it takes effect. So there was an announcement of a repricing towards customers, but this will start taking effect from from mid-July only.

We are, as a group, more or less LIBOR neutral. So this will have a different impact if you look at the different segments as such. And personal customers is really the area that gets the increased funding cost before they get the impact from -- for the repricing. But above beyond this neutrality, it's really the repricing impact of the customer that gives a positive effect for the bank as much.

Maybe just a last comment on clients. We find that our clients are very rational and focused on, in particular, the rates on their mortgages. We have seen also an increased awareness of the type of accounts that they hold their deposits within. But I would say the Norwegian market is very immature when it comes to considering savings in interest rate funds compared to bank savings, it's very much still a bank savings environment. And even we see an increasing interest and activity in saving in mutual funds. It's not so much driven by the price difference as such, but more sort of an increasing pattern of behavior, but movements are relatively slow on the deposit side and the mix still roughly 25%, 75% transactional accounts versus savings accounts.

Now we'll go to Gulnara Saitkulova, calling from Morgan Stanley.

A follow-up on the spreads. As the rate hike through with another rate hike possible later this year. Could the high rates help is the competitive pressure? Or do you think the pressure and the customer switching will continue to intensify around the period change in interest rates? And what means to change in your view for spreads to begin recovering? And do you think the net interest margins have not bottomed? Or is there still further downside to come?

[indiscernible] you sort of elaborate how DNB is responding to more competitive environment across the different areas and divisions and what actions can the bank take to mitigate ongoing margin pressure?

Thank you for your question that revolves around competitive pressure and margins. I would start by highlighting that we are very clear in prioritizing profitability over growth as a starting point. But then also add that, of course, it's important for us to see that we are competitive and win customers also in an increasingly competitive environment. We do get confirmation that this is indeed the case.

One example of this is if you look at personal customers, we have the same volume of inflow of requests for financing certificates this quarter as we had in the same quarter last year but we are more selective on the business we decide to write as we do focus on profitability.

Another testament to this is talking about the record number of new customers in the large corporate area in the Nordics outside of Norway. We already see that these customers use our products more broadly and all on average, have a return that is above the return requirements. So I would say our way to respond to a competitive environment is to be very targeted in terms of focusing where we believe we have our competitive advantages. And this is also how we win businesses through preference and not price in its entirety.

On the margins, it's limited how specific we can be. But of course, as you know, an announced repricing will have a positive impact to our net interest income. The fact that the volumes added this quarter comes late in the quarter should also have a positive impact on our net interest income, all being equal in the third quarter.

As for customer behavior, we have also stated that this quarter is more related to house swapping or actually customers buying new homes than bank swapping as such as people are sitting a bit more still when we are in the announcement period of a rate increase. how this will develop. It's a bit difficult to say. It depends on when -- if and when there will be another rate hike from the Central Bank. But all in all, I think, we continue to expect Norwegians to be very focused and interested in how much they pay for their mortgage but we also continue to expect the Norwegian market to be a rational market and all the major players being active in this market is targeting return on equity as their most important financial metric and, of course, competitive pressure will vary somewhat from quarter-to-quarter. But over time, we still definitely continue to expect this to be a rational market.

And can I follow up with the second question? With your Capital Markets Day coming up later this year, could you give us an early sense of the key strategic themes and priorities you expect to address? Should we anticipate an update to your financial ambitions? Or is the focus [indiscernible] to be more on reaffirming the strategy?

I think there is nothing new to to provide at this point in time with regards to our Capital Markets Day. We do them every second year, every Capital Markets Day, we review and look at our financial ambitions for the coming period, and we try to give you a more detailed guidance as to the outlook. So I think you can expect us to address our future ambitions as well as building up to our strategic initiatives in order to deliver on those.

Next question will be coming from Namita Samtani, calling from Barclays.

My first question, you commented on corporate customers Norway and commercial real estate growing strongly there. I just wanted to understand the rationale for that and do you see good pricing there. What attracts you to that segment as I would have thought it's quite a competitive space to be in.

My second question, I understand growing in large corporates is lower margin business and now it's impacting NII, but the rationale is that it's high ROE business. Is this a strategy that you expect to persist for some quarters? I'm just wondering how you think about the strategy and whether it's a long-term strategy? Or are you being opportunistic here?

My last question, when you think about rate sensitivity to 25 bps, and I think just previously, over the past few years, it's been in the range of NOK 0.8 billion to NOK 1.2 billion, do you include interest on equity and the treasury impact on that? And what are the factors in the past have made at NOK 0.8 billion or NOK 1.2 billion? Is it just purely competition? I need to think about that.

Thank you. I'll ask Maria to comment a little bit more on detail in detail. corporate customers Norway. But please bear in mind that we have talked about this growth as a combination of increased volumes across commercial real estate as well as the growth across the various regions in Norway.

With regards to large corporates, I would say, of course, we have an overall strategy of maintaining a very strong asset quality and diversified exposure in our book. But we do not specifically target specific buckets of risk or our strategy is based on profitability. But after Maria, maybe Harold also can comment a little bit more on that, and I can come back to the rate sensitivity.

Yes, we can see the growth certainly whole Norway, and it reflects the market in Norway as a whole. There is growth in all different areas directively and also in the industry concerning both in the seafood area, the finance [indiscernible] and also in the industry concerning the coastline of Norway. So we can see it through all sectors and all geographical areas of Norway and to reflects the market as a whole.

And I think on the large corporate side, I think you're correct, Namita, because we focus on total risk-adjusted return on the client over time. So as you point out, the margin is slightly down, but you will see that the cross-selling or the non-lending income is up in the quarter. So that means, although the average margin is down, our return on equity is up on the large corporate side in the quarter. So -- and that is really what is our primary ambition.

A short comment on its sensitivity that we do not comment specifically as such, but we have said that the historical movements should be a good reference, and I think you're correctly referring to what the movements have been. With regards to the various moving bits and pieces in the P&L, we've said that we are more or less neutral to LIBOR movements. And in order to achieve that neutrality over time, it impacts also interest on equity and treasury, which means that the net impact to us as a bank, stems from the actual repricing towards customers and only that. And that will be the combined impact from repricing loans and deposits towards personal customers.

We're still 90% and more than 90% of the lending book is floating and a large part of the deposits. And in corporate customers Norway, also a portion -- a larger portion of the deposit, and it's small portion of the loans are floating-based prices. But these are the impacts that will hit our book movements on interest on equity and treasury needs to be seen in context with the LIBOR neutrality.

Will now go to Markus Sandgren, of Kepler Cheuvreux.

So I was also having a question around margins, but not so much for the quarter, but more big picture. So I mean margins in Norway has always been much higher than in Sweden and Denmark, for example. And I get it totally that you have much higher rates. But nevertheless, the margin seems to be much higher regardless of what the level is. So how is your thinking about when competition is picking up and you have several of the other big banks in the Nordics that wants to go into Norway and they can apparently live with much lower margins in the other countries? What do you expect that to bring to the competitive situation in Norway longer term, that is not for the next quarter? That's my first question.

Okay. I'm not sure what data points you are referring to my knowledge, we've had periods where margins in Norway have been more competitive than in in Sweden, and we've had also vice versa for a certain period. Most recent statistics we were looking at, I believe, the mortgage margins in Norway dropped below the level that we have seen in in Sweden. So I'm not sure that I have the exact same data points as you have. Again, we have everything else being equal, a higher level of capital than certain of our peers. We have been having that, and we've dealt with that for years. Beyond that, there is a harmonization of risk weights being applied.

So we are confident that we are able to compete in this market as rational levels. Again, we understand that this market is attractive because it is a rational market. And I think the closest comparison would be Sweden because Finland and Denmark are a bit atypical on mortgages. But we continue to expect fierce competition both from local and Nordic players but are also confident that we will be able to continue to grow profitably in these market circumstances as we feel that we show in this quarter as a testament to that.

It was also maybe worth noting what many of you probably also saw after the release of the first quarter earnings, a narrative from some of these players that they were seeing the competition in the Norwegian market as fears and indicating maybe an increased focus on profitability.

Okay. And then secondly, on capital. So now you -- with the new buyback program, you're coming down to 1% in CET1 buffer. Is that what we should use as a buffer going forward? Or are you heading somewhere else?

We continuously work to optimize our capital position to return excess capital to our shareholders. We do not provide or have spoken buffer on top of the capital requirements from the FSA. But when you see that we are initiating share buyback programs, it is signal that we are more than comfortable with the buffer that we do have.

Yes, okay. And there's no known head or tailwinds on capital requirements?

We see no headwinds or tailwinds to know in the future, correct.

Our next question will be coming from Sophie Peterzens of Goldman Sachs.

Here is Sofie from Goldman Sachs. So I would just going back to the competition. When I look at your fact book, on your market shares, it seems that you have been quite consistently losing some market share in Norway, both on lending and deposit side and retail customers and corporate customers. Like how should we think about the market shares going forward? Do you expect market shares to stabilize? Or is it fair to assume that you will continue to kind of give up some market share to ensure that you just capture the profitable growth? That would be my first question.

And then my second question would be on the press conference earlier today, you mentioned that 50% of your corporate loan growth comes from outside of Norway. Could you just elaborate why you wanted to grow CII outside of Norway and what kind of where the focus is? Is it mainly Sweden? Or is it also some of the other Nordic countries, U.K., maybe or U.S. If you could to say comment a little bit around 50% of the corporate land growth that comes from outside of Norway?

Sure. Sophie, thank you for your questions. With relation to growth, our focus number one is really on profitable growth. And of course, we are also focused on keeping the relative value of our position, which is a leading position across all of the markets we are active in within Norway. And from that perspective, there has been no material weakening of our position.

On the contrary, we are able to deliver growth. And we capitalize on the diversity of our growth platform in order to deliver on that throughout different cycles, I would say, with varying competitive pressure. With regards to the growth in the quarter in the large corporate book and internationally, I will hand it over to Harald but you are right. It's a diversified growth across Norway and international. And I think this robustified the growth platform also above and beyond the pace of economic growth in Norway, where the Nordics also has been an increasing strategic target for us, but Harald can comment some more on this quarter specifically.

Yes. Thank you, Kjerstin. I think if you look at the first half of this year, there's been a strong growth in the Nordic, and it's not limited to Sweden. We also take advantage of the strong position that DNB Carnegie has in Finland and Denmark. -- to grow our business there, albeit from a lower level than we started in Sweden. So -- but we have a lot of success stories also in Denmark and Finland, and there will be more to come.

When it comes to the rest of our international platform, we aim to maximize returns over time and to support our clients. So it will vary. If you look at 2024, we had a very strong growth in North America. If you look at 2025, we had a strong growth in the U.K. and and the countries handled from our London office. So I think that will vary and beyond based also on which industries are most active in that period.

Okay. That's very clear. And if I may, just one final question. On Luminar, could you just comment what your plans are with Luminar and really consider kind of buying back the company?

We -- as you all know, we are a 20% owner in Luminar, where Blackstone owns the other the other 80%, I still believe that there is strategic attractiveness in those markets, but have no comments beyond that as to future plans for that investment.

We'll now go to Johan Ekblom of UBS.

Just two quick questions. First, on asset quality. We're clearly seeing lower-than-expected credit losses in the income statement. But if we look at this development in Stage 2 loans, there was a very big increase in the quarter that looks to be broadly spread on kind of everything except for personal customers. So is there any methodological change or anything that's driving that? Or is this just kind of quarterly volatility? I think it's a 20% increase in overall and 40% increase in corporate Stage 2. So that's the first question.

And then maybe quick on margins, I know we've spoken a lot about it. But if I look at the waterfall you provide in your fact book and add together the margin on lending and margin on deposits, it used to be kind of a NOK 100 million headwind in the quarter. It's been NOK 500 million a quarter the last 3 quarters. And if you're LIBOR-neutral, I guess we can kind of ignore what happened to market rates there. Is it only a step-up in competition that has driven that change over the last 3 quarters? Or is there anything else we should bear in mind when we think about the kind of walk forward on NII?

Thank you, Johan. I will -- Elena will look further into -- in Stage 2. And I -- but I can't say I recognize the numbers. a very large increase compared to the fact that we have a positive migration for the portfolio overall that is visible through through our development and capital. But we'll look into that and come back to you. I think for margins, again, neutrality over all over time is the key message. I'm not saying that it's 100% that. But given the combination of our assets and liability mix, the broad part of our margin-based funded loans goes to fund our margin-based customer loans.

So you cannot only -- but that also means that you cannot only look at the spread development, you also need to look at interest on equity and and treasury. And then I'm quite sure you find a different number than the delta of NOK 500 million per quarter in the past 3 quarters. What has been the main characteristic in the previous 3 quarters, it's been, yes, a competitive environment, but also reducing interest rates and the impact of the repricing from that by the Central Bank. And even though we are saying we are more or less neutral over time. We are not neutral to the absolute level of the key policy rate. And this is the key explanation for the movement.

Okay. So on question #1, I think we need to come back to you on the migration there. But if you look at the numbers for this quarter, the impairment of this to the Polish legacy portfolio mainly -- we'll come back to the...

Yes, I'm just looking at Table 1.5, 0.1 and Stage 2 went from NOK 130 billion in March to NOK 154 billion while personal customers went down. So the increase is all on the corporate side. But we can follow up on that later.

Yes. But this is -- I think this should be related to the growth in the quarter, which comes in all its majority across corporate customers Norway and large corporates, and they come to the end of the quarter. And this is also exposure, maximum exposure amount. So they may vary somewhat from the drawn amounts, which are the volumes that we are referring to when we talk about growth for the quarter as such.

But again, if you look at the risk composition of the portfolio overall, that is all accounted for through development in the capital and the risk exposed amount. And you will see from those numbers that the growth we delivered this quarter, both drawn and in terms of exposure risk exposed amounts that these are capital efficient developments. So there shouldn't be any reason for concern regarding that development.

We'll now go to Riccardo Rovere of Mediobanca.

A couple, if I may. The first one is, the loan book is at least the one on the balance sheet is down first half versus the end of the year. And you stated that you are prioritizing profitability versus growth. I was wondering, what should we do with 3% to 4% loan growth that you have always had in the month? Is that still kind of valid? This is the first question.

The second question I have is something -- somehow related to that. The loan book is down a bit in the semester. As far as I understand, you have executed and SRT. As you stated, if I'm not mistaken, during the press conference this morning, then you stated that you prioritize profitability versus growth. And you stated that the product mix in the margins also is due to the fact that in large corporate there is some sort of maybe better growth in low-margin areas or lower risk. Why are the trade risk -- risk-weighted assets are quarter-on-quarter and in the semester and not up by kind of NOK 15 billion, it is not a material number considering that the book is down and considering this sort of low risk appetite that you had mentioned. How do I square the [indiscernible]?

Just let me -- the book is not down. Average volumes are flat, but the group as a whole, Ultima quarter grows by 1.4%. And just there's a 3% growth in large corporates this quarter. There is 1.5% growth in corporate customers in Norway. If you look at the volumes at the end of the quarter and a 0.6% growth in personal customers. We still maintain our ambition to grow 3% to 4% a year. If you look at our growth in the last 12 months, we have delivered 4.3% growth in lending and 5% growth in deposits.

So I think that what we show in this quarter is that we are growing according to plan and that we are able to leverage the growth platform that we have within and outside of Norway being a bit more selective on the personal customer side and focusing on profitability in the market where competition has been pretty intense. So this is also, of course, then the explanation for the growth in the risk exposed amount, which is less than the nominal growth. And the SRT should also be seen in that context.

Well, okay, fine. If you look at the balance sheet in the quarterly figures, which is stable [ NOK 1.15 billion ], the book was NOK 2.4 trillion and now it's NOK 2.33 trillion. I mean just looking at your numbers, okay?

Yes. Yes. Well...

Maybe the repos, I don't know.

It is the repos.

Okay. Fine.

I apologies. That is where the delta is. If you're looking at the outright balance sheet numbers, it's the reduced activities in retail this quarter.

Okay. Fair enough. But the the 3% to 4%, that's unchanged. That stays?

That's unchanged, and that has been delivered upon and a little more in the previous 12 month period. So I would say so far this year as well. We are on track to delivering on that. And we continue to see opportunities for profitable growth across all of the customer segments. So we think that we have a pretty positive message on growth this quarter. And it's more meaningful for you to look at the developed in the segments as there can be a higher volatility in the volumes related to repos without that really impacting the flow and the P&L numbers as much.

All right. Okay. Okay. And the other maybe very quick question I have is, at these levels, do you still see the buyback is the best way to return capital to shareholders. Don't you think that return on equity, maybe you could redeploy this capital within the business rather than to buy back at 1.8%, 1.7x the tangible equity?

Well, we do not have any perspective on the value of our share when we initiate our buyback programs. What we have is a strong track record on delivering on our dividend policy setting more than 50% of annual net profit and year-over-year increase in dividend per share. and that remains our key priority. When it comes to opportunities beyond 3% to 4% stated volume growth. Then we try to optimize our capital the best way, and we still see share buyback as an efficient tool in this way.

Sorry, as [indiscernible], what tool, I missed that.

The share buyback that you're referring to, we see that as an efficient tool on returning excess capital to our shareholders.

[indiscernible] efficient?

Efficient, yes, correct.

Okay. Okay. Okay. Got it.

Ricardo, just maybe one more thing that just reconfirming that we're very committed to the originate to distribute model puts a high focus on turning the capital quickly around and generating a higher growth in in fee-related advisory and other type business rather than maximizing credit growth. We have we believe, made the experience that this is the best way to optimize on return on capital over time in particular in the North corporate and international area.

Next question will be coming from Jacob Kruse from Autonomous.

So I guess two questions. Firstly, on the commission income. You had this target back in 2014 of 9% over the cycle. Is that -- could you just update on how you think about that in light of the current environment and in light of what you're seeing in your business?

And then secondly, on the margin and, I guess, commission income side, you have this margin pressure here. And as I understood it, you talked about some of the pressure on the margin being offset by better revenues, but they seem to be tracking below your ambitions. I guess my question is, you do that kind of fee business for cheaper lending. Do you risk ending up with a lower long-term profitability book on the lending side in exchange for potential less sustainable fee revenues.

Thank you, Jacob. The answer to the second question would be No. And it's not that we compromise and do nonprofitable lending business on the back of increased fee business. But nominally, the margins can be lower while the return is attractive for low-risk exposure. And this has been one of the characteristic of the growth in the large corporate area in the two previous quarters, but this is not a strategy as such. This has just been where we have seen the most profitable opportunities in the two recent quarters.

We do try, regardless of which level of risk the exposure is that to maximize the the cross-sell and the pocket of revenue on each and every client, also finding that they are more satisfied, the more they use the breadth of our products. We maintained the ambition to grow fees and commissions by 9%. Of course, the backdrop of the 9% is based on executing on the communicated synergies from the Carnegie transaction that was closed now a little more than more than a year ago. And I think we are pleased to see the development in both of these 2 areas, asset management and investment banking in this quarter as such.

I think it's also fair to say that we have not taken fully into account the headwind of the credit insurance. That is more of a capital efficiency tool and the cost of the SRT that also lands in the fee buckets to that extent. But I think I can add that this is really a very good quarter that brings testament to the potential and the value from the merger between Carnegie and DNB markets.

We also see that driving attractive business on the large corporate side in the Nordics, across all of the 3 Nordic countries outside of Norway. So we think it's a very promising development. And we are just in the starting phase, so to say, of realizing the value and the potential in that combination.

And our next question will be coming from Simon Brun of ABG.

Yes. Maybe more of a housekeeping question on the corporate customer ROA deposit margins. I had expected some temporary benefit from the increase in LIBOR and the non-LIBOR linked deposits before the customer rates reprice yet the reported margin was stable or basically flat quarter-on-quarter. Is there anything special offsetting that expected tailwinds? Should we sort of think of the portfolio now being largely repriced? Or should there still be some repricing to come in Q3 and then turning a slight headwind on the margin?

Thank you, Simon. Very good question. There is a particular reason for why the deposit margin on corporate customers is stable and you were quite right to expect that it should have been -- should have improved but there is a couple of movements that we do think about when we talk about the portfolio and asset mix effect, particularly in the deposit base of corporate customers in Norway.

Firstly, all employers in Norway pay out extra salary to their employees in the month of June, the so-called holiday payments. And these usually sits in accounts, which are very attractive to us and low yielding to the client. So that is an outflow of deposits from corporate customers in Norway.

In addition to this, corporate customers have taken on new deposits, the deposit growth from the customer category, larger organizations. Now these are profitable deposits, but they are much more competitive in terms of margin. Thus, they are nominally taken on at a lower margin than the average deposit space in corporate customers. So these are the two elements that leads to a stable deposit margin.

As for the repricing, it has taken effect in corporate customers, but only for two weeks in in the second quarter. So the majority of the repricing impact also in corporate customer in Norway is coming in the third quarter.

We do have one follow-up question coming from Markus Sandgren of Kepler Cheuvreux.

Just a quick follow-up on tax. It seems like it's bouncing up again. Is it 23% still what you expect going forward?

We expect 23% for the year and also in future years.

Correct. Okay. And what was the reason for the higher tax rate this quarter?

This quarter was due to global tax, which is fairly new regulation here in Europe, coin to address the big tech companies, but also hitting across industries, and it's relating to a onetime cost tax effect that actually dates back to 2024 -- higher cost is tax this quarter, and we're expecting 22% in the next 2 quarters.

We have another follow-up question coming from Riccardo Rovere of Mediobanca.

Just a quick one on SRT. Could you please shed a little bit of color on the risk-weighted assets are savings that you achieved with that in the second quarter. And in general terms, do you still see fairly large room to utilize this tool to kind of mitigate RWA growth on top of the loan growth?

The impact of the SRT this quarter is roughly 10 basis points. We will consider deploying this tool further but have no sort of concrete plans. We will do this in sort of gradual and careful manner.

But the -- let's say, you can still do something. I mean you have not used all the available resources to do this.

No. We have done [indiscernible] the transactions that we're taking a pretty conservative approach on this.

We do not appear to have any further questions at this time. I will turn the call back over to the speakers for the additional or closing remarks. Thank you.

If there are no further questions, I would like to take the opportunity to hope and wish you all a great summer. Thank you so much.

Thank you. Bye.

Bye-bye.

Thank you. Ladies and gentlemen, that will conclude today's conference. Thank you for your attendance. You may now disconnect. Have a good day, and goodbye.

Good morning, everyone. Welcome to the presentation of the second quarter results for DNB. It's incredible to see so many beautiful faces in the basement in Bjorvika, on the hottest day so far in 2026. So thank you for coming and listening to this presentation.

First, we would like to congratulate the Norwegian men's football team for reaching the quarter final in the World Cup. In DNB, we feel that we are playing the World Cup every day. And this time, we are at our second quarter final only in 2026. So our CEO, she will present the results and our CFO, Rasmus Figenschou will go into the details. So please kick it off, Kjerstin.

Thank you so much, Even, and a very good morning to all of you, and welcome to this presentation of our results for the second quarter. When reflecting on what has been the most important drivers and areas of attention in Norway this quarter, it's impossible to think about anything else than football. But I am pleased to see all of you here today and to be able to report a strong set of numbers that do testament that there has been something else going on in addition to football in Norway and in our activities internationally also this quarter.

We note the turmoil and uncertainty in the world economy around us as well as an unresolved situation that continues in the Middle East, but do also believe that these numbers continue to be a proof point that the Norwegian economy is resilient with the households being more than flexible and able to enjoy the World Cup in football in the U.S. as we notably see from the activity in the numbers while also making sure that their economy is healthy.

Before diving into the details for this quarter, it is an absolute must for me to talk about one person this quarter in particular. And this is a man who walked in the doors of DNB for the first time, 39 years ago. It is one of the most experienced and reputed Heads of Investor Relations across the country, and I would say, across the Nordics. He has been instrumental in every quarterly presentation the past years in DNB. And he's also been very instrumental in strategically forming our communication, but also our strategy in relation the expectations and desires of our owners and investors. So I'm sure I speak for all of us here and all of us on stream and investors having been putting their trust in us for years in expressing our appreciation for the work that you have done over the years, this is your last quarterly numbers presentations before you will hand over in a few weeks to someone else to take over. But Please, everyone, join me in giving a warm hand of applause to Rune Helland, one of the great DNBers.

As every quarter, I would like to start by diving into some of the highlights in terms of what we are doing for our customers this quarter. Simplifying life for people and businesses and help them prosper that is at the heart of our mission. And I believe all of these examples that we are highlighting here shows exactly how we work and what we deliver in order to deliver on this mission. In this quarter, in particular, we're very pleased to see that many of our customers report that they are increasingly happy with the services that we provide. And we see a record high customer satisfaction for our SME customers as well as our large corporate customers in Norway.

We have, as an example, increased the efficiency and reduce the time it takes to verify an identity of a customer calling us by 77%. We use BankID to do it, and this means that 1 million customers save time when they call us to get help with something that they need. We continue also to receive very strong feedback and trust from our customers in relation to our services with DNB Carnegie. So far this year, we are the most active Equity Capital Markets bank in the Western part of Europe, if we measure by the number of transactions.

This quarter, again, as last year, we also received the #1 positioning from our investors in the Extel survey. That is voted by the investors who use our services. Savings and investments is an area that we continue to prioritize with a rapid release of new features, services and products for our customers.

We are happy to see that Norwegians continue to save with us. And this quarter, we have surpassed NOK 1 billion of monthly savings from Norwegians within our mutual fund and savings products. And these are just a few of the examples to show how we work and strive towards delivering on our mission every day. And I'm very proud of the efforts also put down by the whole team during this quarter.

Over to more what this looks like in terms of numbers, our return on equity, which is our most important financial target, comes in at 14.6% this quarter. This is driven by growth across the business areas in terms of loans and deposits and also a very attractive fee growth driven by Wealth Management and DNB Carnegie this quarter. We do see a profitable growth, both in loans and deposits across all of our customer segments this quarter. The impact of the growth that comes late in the quarter is somewhat offset by portfolio mix effects as well as competition and the NII as such, is down by 1.1% compared to the previous quarter. Please bear in mind that the repricings that were announced after the rate hike from the Central Bank will start to take effect from mid-July.

Net commission and fees up by 4.6% compared to the same quarter last year. The very strong drivers this quarter is within investment banking, more notably corporate finance, that is up almost 20% compared to the same quarter last year with M&A and DCM being the strongest contributors. And yet another quarter with a record high net inflow in Asset Management of NOK 46 billion this quarter is one of the key drivers to Asset Management being up by 13% compared to the same quarter last year. The portfolio remains very robust. It's important to underline in a world that is more volatile around us. 99.4% of our portfolio is within Stages 1 and 2, a cost of risk of 6 basis points this quarter, NOK 338 million, which is primarily related to more customer specific situations.

Earnings per share come in at NOK 6.5 per share this quarter and a very strong capital position, 17.4% core equity Tier 1 ratio, an ample headroom of 100 basis points towards the expected and required level by the FSA. We also have announced today that we will initiate another program of buying back 1% of the outstanding shares. This is in addition to the one that was recently closed last week and both of these programs totaling a buyback of 2% of our shares have been deducted from our capital ratio this quarter.

The Norwegian economy, as already mentioned, remains resilient and robust in today's environment. If we look ahead and the estimates for the economic growth expected in the mainland economy. This is at 1.5% for this year and expect it to remain more or less in the same area of growth in the coming few years ahead of us. The labor market continued to be balanced. Unemployment is low at 2 percentage points and expected to remain low in the future of the forecasting period. Inflation comes down, headline inflation somewhat more than the core inflation this quarter, but it continues to move downward.

However, with a more sticky tail than previously anticipated, which has led to the Norwegian Central Bank shifting their view at the beginning of the year and hiking rates one time during the second quarter. And in their communications and market expectations, we expect one more rate hike to happen in the second half, most likely in the third quarter, taking the core policy rate to 4.5 percentage points.

The further outlook points to an expectation of 2 rate cuts in 2027 in the second half of the year. Bringing the key policy rate down to 4%, where it's expected to remain for the remainder of the forecasting period. Again, we note the uncertainties around us, but continue to see a very robust and resilient economy that forms a very sound backdrop for our business also as we move ahead.

A few comments on the key business areas or customer segments. Again, I reiterate that we see a growth both in loans and deposits across all of the customer segments this quarter. This is important and underlines the growth platform that we have been talking to you for a long time. The growth is more or less evenly spread in Norway and internationally. Most of it coming in the corporate sector. But within the corporate sectors, it's also spread across industries and geographies. We see corporate customers in Norway contributing very strongly to the growth also in the regions in addition to commercial real estate, and we see a strong development in our emphasized Nordic strategy with a record number of new customers coming into our Nordic activities outside of Norway.

Moreover, you will also note from the slide that all of the customer areas are delivering an increase in the pretax profit compared to the previous quarter. For personal customers, we see a very solid activity in a market that remains very competitive. The area shows discipline and remains a focus on the return and profitability of the business. And we note a return on allocated capital of 17.1% in this area. Solid cost control also in personal customers underpins the scalability of our platform in this business. Corporate customers in Norway, I've already commented on the growth and the fact that it's both regional and in commercial real estate, and it's an accelerating pace of growth towards the end of the quarter. More notably, I would like to highlight in this area, a very strong growth in other operating income of 16% compared to the same quarter last year. This demonstrates a broad spectrum of cross-sell, where our customer wants to use other products and services and most notably, a very strong activity and cooperation together with DNB Carnegie.

Large corporates is the area that contributes the strongest to the growth this area, 3% growth this quarter, currency adjusted. We see that most of the growth happened in low-risk customers and low risk transaction. So we see a positive migration in the portfolio as such and the reduced share of high-risk exposure within the portfolio of large corporate customers. Also here, strong and positive development of other operating income, a very solid development of asset quality and the portfolio remains robust.

A few words on DNB Carnegie and Wealth Management, as we have shown over the previous quarters because these 2 are identified as the most important drivers for fee growth in our business. And this is exactly what they are also delivering this quarter. Total income from DNB Carnegie is up 5.3%, with customer income, which is the most important performance-related element in the revenues is up by 12.1%. Very strong investment banking performance. I've already mentioned M&A and DCM, debt capital markets and a numerous number of deals have been closed this quarter, and we have, amongst others, been very pleased to lead the largest high-yield bond deals that have ever been done in the Nordics.

There is also a very healthy pipeline in this business going into the second half of the year. Total income from wealth management is up by 10.1%. Yet another quarter with a record high net inflow, NOK 46 billion flowing in, in addition to the positive market valuation during the quarter. Of these NOK 46.3 billion, NOK 10 billion of them are related to retail customers, which is particularly prioritized and valued. Part of these volumes again stem from what I talked about, the NOK 1 billion in savings that we now see Norwegians saving with us on a regular monthly basis. This brings our total assets under management to the end of the quarter, just below NOK 1,800 billion.

And if we look at the development of the past 4 years, that includes both the acquisition of Carnegie as well as a strong organic growth. You can see that assets under management have more than doubled during the past 4-year period. So that were a few highlights from me, and I will hand over to our CFO, Rasmus, to give you some more details.

Thank you, Kjerstin. I will now take you through the numbers in more detail. We see high -- continuous high activity in all segments with FX adjusted loan growth up 1.4% in the quarter and 4.3% for the year-over-year. We note loan growth in the personal customer segment, up 0.6%, reflecting profitable and disciplined growth. Corporate customer in Norway increased by 1.5%, and that's across geographies and industries. Growth in large corporates and international was up by 3%, driven by increased volumes across industries, growing primarily in low-risk customers. Geographically, we continue to see roughly half of the growth occurring outside of Norway. 3% to 4% growth ambition is defined at group level. And as mentioned, we will vary that growth across segments and remain focused on capturing attractive growth opportunities where we see the strongest customer demand and value creation while maintaining a disciplined approach to risk and return.

Currency-adjusted deposits are up by 1.5% this quarter. Personal customers were up 3.4%, positively affected by the holiday payments received in June. Corporate customers was up 0.3%, driven by term deposits from organizations and partly offset by lower corporate volumes due to seasonal effects. The deposit volumes in large corporate was roughly flat. We maintain a strong deposit to loan ratio in the customer segments of 73.9%. Net interest margin was down by 4 basis points in the quarter to 1.70% basis points. Combined spreads were down by 6 basis points.

Moving on to the NII development to look at some of these movements in more detail. Net interest income is down NOK 167 million in the quarter in total. Net of interest on equity and treasury effects, the margin effect was NOK 264 million. This was fairly evenly split between competition on the one hand, and product and portfolio mix effects on the other, roughly 1.5 basis points on each. There's a higher average volume during the quarter, which contributed with NOK 117 million. And we note that the volumes came late in the quarter. This is also partly offset by currency effects of NOK 97 million. One extra interest day amounted to NOK 121 million. Following the Central Bank's interest rate hike in May of 25 basis points, we announced the customer repricing, which became effective on July 12, impacting the NII positive in the third quarter.

We have a strong and well-diversified fee platform, which totaled up 4.6% from the corresponding quarter last year. Real estate broking delivered stable results in spite of a slow market. Investment Banking Services was up by 7% and I would highlight, in particular, Corporate Finance, up 20%, driven by DCM and M&A, partly offset by lower ECM and securities broking activity. Asset Management and custodial services was up by 13%. We note an all-time high net flow of NOK 46.3 billion, of which NOK 10.1 billion came from the Retail segment, a strong testament to our position in that segment. AUM was up by 11.5% in the quarter.

Guarantees and commissions was down by 3%. Though we noted stable demand for trade finance products, this was offset by FX and mix effects. Money transfer and banking services were down by 29%. The lower contribution is mainly due to costs, not lower income. This is particularly related to the use of credit insurance and securitization to improve capital efficiency as well as higher costs for payment -- card payment services.

Lastly, though our car sales in DNB Finance remain profitable. The reduction in profit per car sold also had an impact. Sale of insurance products was up by a solid 33%. This was mainly driven by increased income from non-life insurance and continued positive development from defined contribution pensions. Operating expenses are up NOK 548 million compared to Q1, reflecting higher activity-related expenses than the first quarter. Higher return on the closed defined benefit scheme is related to market development and is the single highest contributor to drive costs this quarter. This scheme is partly hedged and a corresponding gain is recognized in financial instruments. Variable salaries, fees and IT increased as expected as these expenses are directly related to activity in the quarter and had a seasonal uptick in Q2. The effect from the annual salary adjustments on fixed salary was partly offset by further FTE reduction of 37 from Q1 and this year.

As of Q2, we have more than absorbed the FTE increase of 820 resulting from the Carnegie merger since the announcement. In fact, we are continuously working to increase efficiency and have seen a 9% reduction in head count since our last CMD in the autumn of '24.

Now moving over to portfolio quality which remains robust and well diversified with 99.4% of the portfolio being in Stages 1 and 2. the personal customer portfolio amounting to approximately 50% of our exposure remains strong. We note reversals this quarter mainly due to the sale of nonperforming loans portfolio. We see no negative development in this portfolio. For corporate customers, impairment provisions totaled NOK 387 million. The portfolio remains robust, and well diversified across industries and geographies with no structural changes or negative migrations to notes. The impairments in Stage 3 are related to customer-specific situations. We incur a NOK 124 million provision related to our legacy portfolio in Poland this year -- this quarter. We remain comfortable with the credit quality in our portfolio.

Our CET1 ratio remains strong at 17.4% with a 100 basis point headroom to the regulatory expectations. It was positively affected with 30 basis points from profit generation in the quarter, offset by higher volume growth. We completed a 1% share buyback program last week. And as mentioned, we announced another 1% program this morning, reducing the CET1 ratio by a total of 80 basis points. Leverage ratio remains strong at 6.3%, well above the regulatory expectations of 3%.

Combined with the CET ratio of 17.4%, our capital position remains strong and enables us to continue to deliver on our dividend policy as well as supporting the growth of our customers.

Summing up, we delivered a strong set of results this quarter, reflecting in our key figures. Our ROE coming in at 14.6%. And cost income coming in at 40.3% and earnings per share at NOK 6.5 this quarter, summing up to NOK 13.01 for the first year in total. The tax rate for Q2 was 24.4% as a result of an additional tax expense related to 2024 in accordance with global minimum tax regulation.

We expect the tax rate in Q3 and Q4 to be 22%. And as a result, the tax rate for the year as a whole at 23%, in line with our guidance for coming years. Before we open up to questions, I would like to invite also you all to our Capital Markets Day in London in November. With that, thank you.

Thank you so much, Rasmus. And there will be time for some questions from the audience. Simon, please, you can start with the microphone for Simon in ABG.

Congratulations on another quarter. Two questions, if I may. The first one on competition. And I know, Kjerstin, you prefer to talk about yourself rather than your competitors. But how do you see the competitive landscape out there? Has it changed in any way since last time we spoke? Where do you see customers maybe more so in the households and private customers? Will they change their behavior when the actual rate changes appears? Or do you see that effect sort of being behind you? That's the first question.

The second question is also related to the margin on the lending side, but maybe more so on the product mix and portfolio mix. You have mentioned this several quarters now. So it seems to be sort of like a structural thing, but is also most of that behind us now? How long will it last before it sort of normalizes going forward?

Thank you for 2 very good questions. Again, I would like to reiterate that net of interest on equity and treasury effects that needs to be taken into account when the money market rate moves, the impact negatively on spreads are NOK 264 million. Half of this is related to competition, roughly 1.5 basis points, as Rasmus alluded for, and the other one to product mix effect. So overall, I would say that our assessment is that the competitive pressure that is there, and we do comment on it is fairly well contained, I would say, within the way the business is run.

Has there been major changes in the competitive landscape compared to last quarter. An overall assessment is that has not. There is still a very high competitive pressure, notably within household and mortgages. We see on the corporate sector, in particular, in the larger areas and more internationally, as you see from the growth we deliver that we are differentiating our offering through the advisory services that we provide through the industry knowledge, through our trade finance type products, through our commodity derivatives. I mean there's a large arena to play on that enables us to deliver the growth that we do this quarter. Households, there is still an impact from there being a lot of capital in the market, and we have many different players being active.

However, as you do, we note a narrative out there that is more outspoken. So there is signs indicating that there is still a very sound basis to state that this is a rational market. Everyone is targeting a return on equity. Everyone is over time disciplined about deployment of capital. This is what we have seen before, but we also have to say that still by the day-to-day business now, it does remain very competitive.

In relation to portfolio mix effects, you are right, we have talked to about this in the previous couple of quarters, but the reasons vary. Some of them are similar.

Also this quarter, as we talked about, a positive migration, lower ratio of high risk is a result, amongst other of the fact that large corporates grow in small -- in low-risk customers areas. So there is a mix effect from that. Another mix effect is the development on the deposits for corporate customers in Norway, where there is an outflow of holiday payments to employees, which are high-yielding deposits and the growth in deposits from organizations that are more competitive in terms of the margins that are paid, which is why you will see a flat development on the deposit margin for corporate customers in Norway this quarter. So these deposits are still profitable for us, but on a nominal basis, they not contribute positively to the margin as such.

In relation to the holiday payments, of course, there is an inflow into the accounts of personal customers, but we see increasingly, and this has been 1 of the traits of the development in personal customers, that people are rational and they are more focused on how they manage the split of their funds between savings accounts versus more transactional accounts, which have lower rates for them and of course, a higher profitability for banks. A bit difficult to be very specific about what to expect going forward. Of course, elements like holiday payments is seasonal and limited to the second quarter. There is a limit to how much money can shift between different accounts because we will always have a decent sort of level of deposits also on transactional accounts. I think that is fair to assume. But there could be other seasonal variations also that impacts this as we move ahead.

Thank you. Thomas Svendsen from SEB.

So a question on lending margins for the large corporate side, it was down Q-o-Q. I know it's a short time period, but did you say that this mostly a reflection of lower risk or increased competition? And what should we think about that in the -- going into the second half?

It is mostly a reflection of lower risk and the transactions that have been completed during the quarter, but there is a competitive pressure across. But at the same time, we continue to be very mindful of being selective and prioritizing business where we do see that we can deliver on our profitability target. I did mention amongst other -- the record number of new customers coming into our Nordic portfolio outside of Norway. And we could also add that these customers already with what we have done with them so far this year, they are at the same profitability level as the existing portfolio.

And just to follow up on that. If you look at the lending growth in the second quarter, should we think that's a reflection of where you see the best risk-adjusted return? Or is it too short only 1 quarter?

It is important to highlight, as you're almost doing that the growth in large corporates is a bit choppy quarter-to-quarter because these are several larger transactions that we work on, and that total portfolio has a duration of less than 2 years. So constantly, they're doing a lot of transactions that come on to the books in addition to refinancings. But you are right when saying that we grow in areas where we do find the opportunities to deliver on our profitability requirements. There is a strong discipline in the area on how the capital is allocated. And the areas where we are growing this quarter is power and renewables. It's trade and services, trade and services, most on the services side related to our Nordics strategy. It's what is grouped as TMT, technology, media and telecom. And in this area, you will find some activity related to data centers. So of course, it's reflective of areas that have growth trends, but also areas where we are positioned to deliver more than lending capacity, and we see an increasing share of non-lending income from our international business.

Thank you. Herman Zahl from Pareto, please.

Just a question on fees, on the money transfer fees being down so much. Is this something specific in the quarter on the cost side or pricing that's driving that downwards?

As Rasmus alluded to, it's the cost element in the money transfer and banking services that is instrumental in the development and not the revenue stemming from activities. Second quarter and third quarter is usually a high activity quarter in money transfer. As communicated in previous quarters, there is the cost of credit insurance that we have built up in the large corporate portfolio and is one of the reasons why we have a very capital-efficient growth this quarter, if you look at the development in risk exposed amount. So there is a positive impact of it there. That is impacting, in particular, and also the cost of the SRT that was completed in the quarter.

And then on the life insurance results being quite good. And seem to be at this level, at least since early '25. And you have also increased your profit sharing a bit there since then. So do you think this is sort of normal run rate level to expect going forward?

I don't think we've been completely explicit on the run rate. But of course -- and these are 2 elements to consider. One of them is the risk result in the insurance business. The other one is the return on the corporate portfolio that is invested on the equity side. And of course, the latter is reflective -- should be reflective of the development of the market. And this quarter has been a very strong market with very strong development in the return of the corporate portfolio. But more longer term, which we have talked to is the efforts that have been done in the life insurance business of repricing our services towards customers, that hits the risk result, and this has consistently been improving and should be a more longer -- should be a long-term development.

Thank you. If there are no -- yes, we do have a question from [Christopher Bergen] in Arctic just behind you, Julia.

I believe, Rasmus, you mentioned a sale of a nonperforming loan portfolio. First, perhaps you can give some more color on that or just quantify the effect?

Actually, this was part of our -- it's in the retail business. And in terms of detailed capital effects, I don't actually have them on hand. I have to get back to you on that.

But it's -- we do sell -- I mean, we have a deal with -- probably it's known who we have the deal with Axactor that on a regular basis buys our non-performing portfolio or small nonperforming portfolio in the retail business. And that creates normally a day 1 effect on the time of the execution of the sales. .

You'll see that as a net reversal in personal customers. But what we can say is that the quality is stable. There are no material movements in the losses if you compare them to previous quarters. So it's still a very, very robust and well-performing portfolio in the personal customer segment.

Thank you. Simon, you had another question? Just in front of you, Julia.

Yes. Just a quick question. I probably know the answer already, but the Fremtind ,the non-life insurance company, another super strong quarter, really successful turnaround of that business. Do you feel it gets the sort of recognition it deserves, being sort of hidden in your P&L? Is there any scenario in the future where you could see some structural things happening to Fremtind or is it too important for you to have within the business?

We are very pleased to see the positive development in Fremtind, along the lines of the same reasons as we talked to for the repricing of the life insurance business. We also see this on the non-life. And we do believe that there is still a very promising potential going forward. And a lot of the growth opportunities for that company lies within our customer base really in corporate customers Norway. We always think that we need to work even more to make the value of the various elements visible. And of course, here, there is one element in fees and commissions and another one in associated companies that is sometimes hard to really give the appropriate number of light to in a large group like ours.

But we also believe that a very important strategic piece of the business. And we see in a world that is ever more digital, the value of offering and being able to deliver a broader number of services with our customers. We believe this to be increasingly important in the world where our customers are more and more digital. And as for future potential strategic choices. Also noting that we are the third largest owners in this company, I will refrain from commenting specifically, as you probably expected.

Thank you. And thank you for asking questions, even though you know the answer, Simon.

Now I'll ask you for the last time. Any questions from the online audience.

Okay. We got a couple of questions here from Roy Tilley from Arctic.

You showed NOK 46 billion in net flow in the quarter, which is more than double the record quarter you had in Q1. Can you talk a bit about where the flow is coming from and what you have been doing to ramp this up so quickly? That's question one. And number two is you seem to have had a better growth in PC towards the end of the quarter. Can you say anything about what the mix in terms of distribution channels? Is Sbanken the main driver currently?

Very good. Relating to the growth in net flow, we see this comes -- I'll start off with the retail segment. And as mentioned, we broke a record high of NOK 1 billion per month in the fixed or the recurring savings from our retail segment, an additional NOK 9 billion coming in totaling at NOK 10.1 billion.

So on top of that, we also have various institutional activity around our flow. And this quarter was 1 particular large transaction contributing strongly driving that growth significantly. That being said, we see those -- this is part of a larger trend, where we see both institutional and retail providing to a very strong flow quarter-by-quarter and reaching records both quarter and 12-month trailing. So in sum, this is an active approach, both in terms of the actively managed funds we provide and the sales channels that we use, both on the retail and the institutional side.

As for the growth in personal customers, what we can say is that the major part of the new business this quarter is related to purchases of apartments or new homes as the bank swapping has been limited in a quarter where -- our interpretation is that it's more challenging for customers to navigate in the market where prices are moving at different times and phases. So the major part of the activity is related to home acquisition. We're pleased with the development in both brands without being sort of specific as of what comes from where.

Thank you. We have one question also from Sofie Peterzens from Goldman Sachs.

On the competition. What pressures are you seeing on the underwriting structuring side? Do you have to compromise on underwriting to defend market share? How do you ensure your new loans have the same credit quality as the back book? Do you think underwriting could become a margin issue at some point?

We do see competitive pressure across the market that impacts both structure and price. But I would say that we are able to grow at the pace we are doing today without compromising on structure nor price. I think the testament to that in the quarterly numbers is the fact that there is a positive migration in the large corporate book that there is a broad diversification in terms of areas where we're growing both geographically and in terms of industries and also the fact and the data point we shared on the 46 new customers in the Nordics outside of Norway, already delivering profitability to the group above the required hurdle.

All right. So if there are no further questions, members of the press will be able to talk to management afterwards in the lounge area as usual. And I think we can conclude and wish you all a very happy summer. Thank you so much.

Good afternoon, everyone, and welcome to DNB's pre-close call for the second quarter. The reason for this call is to remind you of what we already have shared with the market and some relevant public data, which could possibly affect the second quarter results. There will be no new information during this call. The script for this call will be published on our IR website.

And as usual, I will start with the NII and the capital, and Anne will continue with the rest of the P&L. Starting with the NII, there is one more interest day in the second quarter compared to the first. So this is expected to impact the second quarter's NII positively by approximately NOK 120 million. On the lending volume side, we saw FX adjusted growth of 0.3% in the first quarter. So far this quarter, we've seen the average NOK strengthen, impacting NII negatively. The FX split in the loan portfolio for the first quarter was 8% U.S. dollars, 7% Euro and 6% SEK.

Following the Central Bank's decision to raise the key policy rate by 25 basis points to 4.25% on May 6, we announced a customer repricing of loans and deposits of up to 25 bps. This repricing will become effective from July 12 for existing customers. With the Central Bank's decision to raise key policy rate by 25 basis points to 4.25 -- sorry, with the Central Bank's latest policy rate decision today, the key policy rate was kept unchanged at 4.25%. It states that it's likely to raise the policy rate further at one of the forthcoming monetary policy meetings.

The policy forecast is a little higher than the one published in March and is just above 4.5% at the end of the year. DNB Carnegie's macro team expect a 25 bps rate hike in August. Longer term, they expect 225 bps cuts in late 2027 to stabilize at a terminal rate of 4%. We continue to see strong competition in the bank market.

Over to capital. In the first quarter, we reported a CET1 ratio of 18.1%, well above the Norwegian FSA's expected level of 16.4% -- based on the FX development so far in the second quarter, there will be a small positive effect on CET1. To repeat the FX sensitivity on CET1, when there is a 10% change in FX, there is approximately 20 bps change in CET1 ratio. On May 15, we announced the initiation of a 1% share buyback program. The capital cost of approximately 40 bps will be taken in the second quarter.

Over to you, Anne.

Sure. Thanks, [ Jenna ]. Starting with a general comment on net commission and fees. Generally, activity levels tend to be higher in the second quarter compared to the first quarter, impacting fee levels positively. Moving on to financial instruments at fair value and starting with customer revenues in DNB Carnegie or FICC. This typically sees a seasonally higher activity level in the second quarter compared to the first and is, of course, also impacted by market volatility.

The mark-to-market effects on the AT1s and the basis swaps will be announced shortly after quarter end. And a reminder on the outstanding FX AT1 amounts, we have USD 700 million outstanding, and we have SEK 4.95 billion AT1s outstanding. Moving on to costs. Seasonally higher activity level than we typically see in the first quarter, all else equal, typically leads to somewhat higher costs in the second quarter. The central wage negotiation in Norway came in at 4.4% for 2026, and the wage adjustments will have effect from May 1.

DNB Carnegie's macro team expect salary inflation in Norway to come in at 4.6% in 2026. As communicated previously, we expect to incur nonrecurring integration costs related to Carnegie of up to NOK 200 million in 2026, and we saw NOK 33 million in the first quarter. A reminder on pension expenses. As previously mentioned, normalized pension expenses are expected to be approximately NOK 500 million per quarter and the closed defined benefit compensation scheme is primarily linked to the development in global equities.

Asset quality, there is really no change in our message on asset quality compared to what we presented at our first quarter release. The portfolio is carefully monitored, and we are still generally comfortable with the risk in the portfolio. As you know, impairments vary from quarter-to-quarter, driven by potential changes to macro input factors in the ECL model and/or company specific events as you've seen in past quarters. And as we've said previously, given the elevated level of uncertainty driven by the global macro picture, it would be natural to see more company-specific events.

And finally, a kind request or a reminder to please submit your consensus estimates to Rune by close of business on Friday, July 3. That marks the end of our call. We thank you very much for attending and wish you a good day ahead. Thank you very much.

Thank you.

Good day, and welcome to today's DNB Q1 Conference Call. This call is being recorded. And now I will hand the call over to Rune Helland. Please go ahead, sir.

Thank you very much, and hello, everyone, and welcome to DNB's analyst call for the first quarter. To answer your questions here in Oslo, we have the CEO, Kjerstin Braathen; CFO, Rasmus Figenschou; Head of Personal Customers, Maria Loevold; Corporate Norway, Marianne Saetre; and MCI, Harald Serck-Hanssen; and of course, DNB Carnegie's, Alex Opstad, in addition to Head of Risk, Eline Skramstad.

Before we take your questions, Kjerstin will give you the highlights for the quarter. Kjerstin?

Yes. Good afternoon, and thank you for spending the time with us. Just some brief comments that we have repeated during the day and for this release of our first quarter numbers that we believe to be a robust set of results to start the year that has been a rather turbulent start to the year with the conflict in the Middle East. A few points on the Norwegian macro, which continues to show resilience, and we see further proof points that Norwegian households are robust. We see the GDP estimates for this year and next year ticking slightly downwards, but we're still talking about healthy growth levels in the area of 1.4% this year for the Mainland economy and 0.9% for next year.

We continue to see unemployment remaining at a low level with 2.1%, and it is expected to remain so. And the expectations for this year's wage settlement process is that we will see a real wage growth for households, and this supports the expectations that consumption will continue to be a driver for economic growth. And inflation that has been somewhat more resilient to come down than expected and also last year's wage growth has led to, in combination with a more unstable environment, a turn in the outlook from the Central Bank and the turn that has been adopted by the market as well as the macro economists in DNB Carnegie. And this is related to the interest rate outlook for the key policy rates that is now expected to be increased on 2 occasions this year, each of 25 basis points, taking the key policy rate to a level of 4.5% rather than the expectations of a further cut that was the situation the last quarter when we had our call.

We believe the economy is robust in dealing with that and the resilience in the economy will continue to be demonstrated. And the outlook is still what we consider to be a benign outlook for our business despite the uncertainties being higher than normal. For the quarter as such, return on equity comes in at 14%, supported by growth and I think a strong performance across the customer segments. We continue to deliver growth on the lending side, nominally less visible this quarter because large corporate is the entity that grows the most with 2.3% growth, which is offset by a stronger Norwegian krone this quarter.

On the deposit side, we see very healthy growth in Corporate Customers Norway as well as on mortgages. And I think overall, the signal going forward is that we are confident that we will be able to deliver on our growth platform and the 3% to 4% we aim for a profitable growth within a year.

The growth impact and its impact to NII is, however, offset by narrower spreads stemming from repricing as well as a fewer number of interest days. We also have an impact from asset mix and NII is down 5.4% from the fourth quarter. Commission and fees up 18% compared to the corresponding quarter last year, in which Carnegie was only accounted for by 1 out of 3 months. We still believe this is a robust result with a very high activity in January and February, somewhat muted by the conflict in Iran and the postponement, I would say, of some of our customers' projects, but also in commission and fees, a very, very strong quarter for Wealth Management with a record inflow of new assets of NOK 20 billion in the quarter as such.

Important to note also that the portfolio remains very robust. There is no negative migration, no systematic deterioration in any area of the portfolio. The impairments that we booked of NOK 644 million in the quarter is mainly related to customer-specific events in Corporate Customers Norway, and there are no other systematic developments of concern that we feel need to point out to you.

Lastly, capital position, very robust, 18.1%, also supported by 20% from the dividend that was upstreamed from DNB Liv. That was the annual result. There was also a capital release in the fourth quarter. So we continue to demonstrate how that business is supporting our capital position. Earnings per share NOK 6.5, ample position to support our customers with further capital pay out on -- in accordance with the dividend policy. And the last comment I would like to make is our general assembly that was held on Tuesday, where the Board was given, again, a power to buy back up to 3.5% of our shares during the course of the year, and we have already sent an application to the FSA to initiate that, and we'll revert back to you once we have that response.

And with that, I think we will open up for questions.

[Operator Instructions]

The first question is from Gulnara Saitkulova from Morgan Stanley.

So my first question is on lending spreads. We see that they declined meaningfully quarter-on-quarter. Could you break down the drivers of this compression specifically? How much was attributable to lower interest rates versus potentially competitive pressure? And do you expect any further compression from here? Or do you think we reach the trough? And looking ahead, where do you expect the spreads to stabilize under 2 scenarios, one in which rate hikes resume and another in which rates remain unchanged?

Thank you so much for your questions. In order to consider the spread development, we usually say that it's important to look at the volume-weighted spread because when you look at individually the lending spread or the deposit spread, you will see the movements of the money market rates. And in particular, this quarter, you will see a weakening related to the growth in money market rates throughout the quarter, but then that also finds it's opposite in the development on the deposits.

So I think what we can give you in terms of meaningful guidance to understand the development on spreads that are in total NOK 449 million for the quarter is that roughly 1/3 of this is related to the last part of the impact from the repricing that we did that started to take effect in November last year. There is quite some impact also from changes in product mix effects. I will describe in further detail. And there is also slightly less than 1/3 that stems from competitive pressure across the segment, but particularly what we're talking about is personal customers and corporate customers in Norway.

Now product mix effects, what is that? One part of it is a change in the regulation for how companies pay their amount due for taxes throughout the year. There has been a regulation where they have been building up an amount in accounts. This has been low-margin accounts, very attractive for us. And they used to pay that on 4 occasions throughout the year. Now this is paid directly. So no deposits are accumulated in our accounts. And we have talked about this. This will have a negative impact on our NII for the year of NOK 300 million.

Another effect that we see on the large corporate side is that we see a repayment of loans that have higher margins than the average margins in the area. And we see that the growth coming on to our books, the new volumes coming in are low risk and lower margin volumes. There is also an element of that in corporate customers Norway. Beyond that, we continue to see that customers are rational in their deposits, typically moving deposits when they can from lower-margin accounts to higher margin accounts.

Now as for your question, where do we expect them to go if rates go up or down, I think it's very challenging for us to give you any specific guidance on in view of the fact that our margins develop with our potential decisions to change prices if and when the policy rates move, and we are not in a position to comment on our possible future action on pricing. I think what we can say is that we continue very systematically and disciplined, I would say, to prioritize profitable and sustainable growth, which is probably a reason for seeing a slower growth in parts of the business than others this quarter.

But we are very pleased to see that a large number of customers are interested in using our products and services for their needs, and we are able to grow across the business while also keeping a priority on profitability. And that is also our message for the remainder of the year. We are indicating 3% to 4% growth. We are not specifically splitting that up from one segment to the other, but 3% to 4% profitable growth is what we believe we will be able to deliver across the platform of the various customer segments. So I hope that was a little bit helpful.

And can I also stick into the revenues? Investment Banking asset management performance was softer this quarter. Could you provide an update on how your investment banking pipeline is shaping up across the different product lines? What trends are you currently seeing? And how would you characterize the key drivers of the fee income growth going forward? And have you observed any meaningful shifts in the sentiment towards the end of Q1 and into the start of Q2?

Thank you. I will make a few comments on Asset Management, and then I'll ask Alex to comment on Investment Banking. You can see from one of our slides that the revenue on a 12-month rolling basis continues to grow for both of these areas. I think for Asset Management, obviously, markets have been more volatile and come down. So it's a mere a consequence of the fact that market valuations are down in the year that you see a reduction in assets under management as a whole. But on the contrary, we have a decent growth on the fee side, and we see record volumes coming on to our books through the net inflow, which is more than NOK 20 billion in the quarter. And this is a record level of net inflow for our business.

We have also talked about that this record remains also if we look at the previous 12-month rolling period where the net inflow is NOK 65 billion. So it seems to be a lasting trend. And I think it is also a result that we have been working systematically with this across all of the DNB activities where we have a lot of different positions to work on in relation to activities related to savings and investments.

As for the margins in Asset Management, they're stable in the quarter. We do, however, comment that over time, there is a trend towards index-related products, but we have also seen other regulatory changes related to pension and account structures, but we've, along the past few years, been able to more than absorb these by new business coming on to our books and by a relatively attractive growth on the retail side, which is a higher-margin business. And the retail volumes also represents more than NOK 5 billion of the inflows this quarter, which we think is a pretty strong number.

Alex, Investment Banking?

Thanks, Kjerstin. So of course, softer quarter-over-quarter, but that's more of a seasonal effect. If we look at the year-over-year effects, our business is growing and the bright spot in Q1 on the investment banking side is M&A. The capital markets revenue lines were softer. If you look at the Nordic markets, for instance, on the Nordic high-yield side, issued volume in Q1 '26 versus last year was down about 35% and that we have to put on to the market volatility in March. So it was a good start to the year in January and February and then projects got postponed, particularly within DCM and ECM in March for obvious reasons.

I'd say the pipeline is strong and intact. And of course, sector-wise, there's been increased activity within oil and gas and energy, which on a relative basis is sort of to our favor. And in some other sectors, we see more of a cautious approach.

Our next question is from Sofie Peterzens from Goldman Sachs.

It's Sofie from Goldman Sachs. So just going back to the previous question on competition in Norway. All the banks are saying there is a lot of competition in Norway. You also had it in your report earlier today. But could you kind of just discuss the competition a little bit? Is it only on the pricing side? Or are you also seeing it in terms of kind of terms and covenants that these are being loosened? And what's the outlook? What could kind of trigger that competition eases? Do you think if rates go up, that should reduce some of the competition? Or how should we think about it? And do you also see a lot of competition on the deposit side?

And then my second question would be on the fee side. I know fees were up 18% year-on-year. But when we look at the kind of expectations that the market or consensus estimates are doing embed kind of 9% fee growth going forward. How confident do you feel that you can deliver over 9% fee growth kind of underlying over the next 2 years?

Thank you, Sofie. Good questions on the competitive dynamics. I would say that we see it, I think, primarily on the mortgage side, it is price related. Typically, the other alternatives are related to customer offering and other type services that customers value in addition to price for why they choose as they do and not so much structure. Moving into the corporate customers in Norway, I would say that we do see an impact both on the pricing and on structures. And part of the reason why our volume development is not as strong in Corporate Customers Norway this quarter is that we have said no to a larger number of transactions than we usually do.

All the same, we are overall pleased to see the total volume that we are able to put our on books while protecting both profitability and risk in accordance with our standards. What could reduce competition? It's always hard to be that specific overall, but I think nothing has changed in terms of the messaging of Norway being a rational market. What makes it a rational market is that all players active in the Norwegian market are focused on profitability and return on equity. And we have noted, as I'm sure you have, that some of the messaging is changing from certain of the players in the market. One could speculate that, that means that the focus on profitability is starting to become a bigger part of the conversation.

I can only answer on our behalf that we keep that employment of capital disciplined and keep our focus on profitability. Are we seeing it on the deposit side? I would say yes, but deposits are typically less what you call it, they're more sticky than loans, apart from in the large corporate sector, where we are typically more opportunistic, coordinate very closely with treasury and take on the deposits that makes sense for us at the pricing that makes sense. But this is the main reason why we have seen some deposit outflow in the large corporate sector, but we also see that we are an attractive counterpart.

On the fee side, we maintain our ambition of 9%. We continue to see the integration of DNB Carnegie progress as expected. We continue to reap the benefits, I would say, from a stronger and more competitive offering towards customers. But as we've also seen in the month of March, this quarter, we are not insulated for -- from what goes on in the market. So we will be impacted by that. And if that should turn out to be more turbulent than expected, I think it always has to be the relative performance that is evaluated in relation to this area. But we see no reason to change the communicated ambition on the fee side.

Our next question is from Namita Samtani from Barclays.

My first one, how do you think about capital allocation between the retail division and the corporate divisions, both Norway and large corporates now given the fierce competition in retail? Do you want to allocate more capital to corporate now? And secondly, just on market share on the retail loans and deposits. In many quarters, the fact book shows since the 31st of March '24, there's been a loss in market share. Do you think that's inevitable given the size of the bank you are? Or what can be done to improve the franchise that there isn't market share slippage?

Thank you, Namita. Capital allocation, I would say that we have been pretty consistent. We will prioritize allocating capital to the personal customer area and the lower part of the corporate customers Norway as long as we can do profitable business. But we are not sort of -- we have a dynamic approach towards capital allocation. We do not allocate in the start of the year a specific amount of capital to the 3 areas, and then we stick to that. We are keeping this dialogue ongoing in group management. But given the nature of the business, we will not put limitations on personal customers nor the lower part of corporate customers in Norway, the SMEs, if they can grow profitably.

And beyond that, large corporates, the limit is really related to profitability. And if they have even more opportunity to grow, they will have to use the various tools to increase the turnover of capital, which is why we have focused so systematically on originate to distribute and increase the turnover of capital, which is beneficial for the return. This is a tool that is particularly available in that sector. But naturally, when we see less capital being employed as we have seen this quarter in mortgages and in Corporate Customers Norway, there is a further room for large corporates to grow.

As for your question related to market share, it's important for us to show the ability to grow. It's important for us to maintain a very clear #1 position in the SME area, in the personal customer area. Both of these are fulfilled, if you will, also throughout the period where we are giving away some market share, but these are the 2 criteria that we are focused on.

Our next question is from Riccardo Rovere from Mediobanca.

The first one is on NII. Rasmus here I'm quoting you what you stated this morning during the press conference. As in every -- almost in every first quarter, activity is lower. This naturally impacts net interest margin, which was down by 7 basis points. The reduction reflects narrowed combined spreads and other NII not included in the customer segment. Now if I look at your fact book, which is -- and here I'm referring to Table 1, 0.2, 0.1, I don't know if you have it in front of you. And I look at the other net interest income, I noticed that over the past 3 years, systematically Q1 -- other net interest income in Q1 rose by roughly NOK 500 million. It was NOK 500 million in Q1 '24. It was NOK 540 million in Q1 '25 and now seems to be almost NOK 700 million, of which maybe NOK 170 million was a one-off in Q4.

Now 3 years in a row, maybe a coincidence or maybe there are technical factors that basically imposed, if I may say so, the NII going down in Q1. And then in 2024 and in 2025, that was recovered the following quarter. Now can you please explain if there are technicalities, technical factors that force other NII down in every single first quarter, please?

Very good. I will try to answer that as a very, very precise question. So I will try to answer it as precisely back. There are certain factors that are repeating, but they will play themselves out a little bit differently depending on the interest regime. One example being in the other NII would be the gradual buildup of interest, say, owed to our retail customers building up through the year being then deposited into the customer accounts in Q4, leading to a -- and having then benefited the bank within other NII gradually and then searing out at the start of the year. So that's a gradual buildup through the year being deposited into the customers' accounts and then starting over again the next year. So that would be one such example of a cyclical repeating nature.

One that is hitting us this year, but that is not repeating nature, but other effects in other years will be, for example, on the tax account for SMEs. That's due to regulatory change, where in the past, they've had a gradual buildup on their accounts and paid it to the government in, I guess, once every quarter as far as I remember. And now it's a much more frequent repayment to the government, thus reducing the holding period within the bank. That has about a yearly effect of NOK 300 million.

So there are some -- in other NII or that effect in terms of not hitting directly within the business areas. It's also treasury and risk management, which would be this year, for example, on the changes in the liquidity management portfolio, which has partly the effect on the other NII in the average. So even though it's not as -- even though there are not repeating patterns every year, some are repeating and others are more either happening like the tax account happening once -- yes, and then probably other things than in the past of similar nature.

But there are basically factors that naturally push NII down in Q1 that has nothing to do with what you do from a commercial standpoint.

Yes. Well, the delta from Q4 to Q1 pushed it down. That's correct.

It has not been -- it seems to have been a pattern, Riccardo, but I don't think that we can consistently say that you should expect this on every occasion. There was a couple of years that -- where this pattern changed in the aftermath of COVID, but you are right in saying that more years than others, that tends to be the direction.

Well, the new disclosure is in place since Q4 let's say, by quarter we have numbers since Q3, Q4 '23 and every single year in Q1. I mean, 3 years in a row. I don't know if that is a coincidence, but 3 years in a row. Maybe it's not a coincidence.

We have disclosures many more years back than that, if you look at our...

No, not the new one, the new one. Anyway, I understand. The other question I have is on -- you reiterated the 3% to 4% loan growth. Q1 numbers seem to be a bit lagging behind, if I may say so. So I would imagine your reiteration of the 3% to 4% loan growth means that you are expecting let's say, improvement throughout the rest of 2026. And I was wondering whether eventually higher policy rates could put the 3% to 4% at risk in case.

Of course, I mean, given the fact that we have a currency adjusted growth for the group of 0.3% in the first quarter, an indication that we believe we can reach 3% to 4% necessarily means that we need to see a higher growth rate in the coming quarters. And typically, we see that with the second and the fourth quarter being the higher growing quarters seasonality-wise in the year. We do expect this across our activity. I wouldn't say that we expect potential rate increases from the Central Bank to jeopardize this. Again, we reiterate the growth platform that we have been talking about where we both have our Norwegian activity as well as our activity now increasingly in Sweden, but also outside of Norway in industries and sectors where there are increasing investment and our messaging is consistent in saying that across all of this platform, we believe that we can deliver growth also at times where -- when and if there is a slower growth in mortgages and SMEs in Norway.

We did say this morning that activity in the housing market was a bit subdued and possibly in view of the messaging on rates. But I mean, it's not a very big change. We also pointed to the very strong results, we believe, in our brokerage -- property brokerage activity where our results were higher than they were the same quarter last year. And of course, a continued growth in house prices, a nominal wage settlement that is expected to be in the area of 4.5% and inflation are also positive drivers for growth in our business. And I think the performance given the market in the mortgage area was pretty strong in the first quarter.

And typically, second quarter is better and expectations are somewhat higher. But overall, it's really what we deliver across the whole of the platform that you should look at.

We'll now move to our next question from Martin Ekstedt from IDCM.

This was Martin Ekstedt from Handelsbanken and [indiscernible] So 2 questions from me, please, if I may. Looking at yesterday for growing Norwegian SME lending by 5% quarter-on-quarter. I think you started out by saying that you see healthy growth in your [ CCM ] division, but I assume you mean year-on-year then because quarter-on-quarter, it seems like you actually declined by 2%, 2.5%, if I'm right. I think you mentioned before that you said no to more business than usual. So I mean my quick interpretation would then be that one of you do or the other protected margins in Q1. Is this correctly interpreted?

Thank you for your question, Martin. I think I will refrain from commenting on what others are doing and just commenting on the development that we see. And if you heard me saying that our volumes grew for corporate customers in Norway, that was not precise. Our volumes were down 1.2% in the first quarter. It may be that those are currency adjusted numbers and what you're looking at are not. But where we see a stronger growth is on a 12-month basis, where it's 5.6% and 7.1% on deposits.

The development was substantially impacted by syndication and distribution of a couple of large transactions that we did within commercial real estate that were closed towards the end of fourth quarter. And we talked about them when we released our fourth quarter earnings. So the inflow and new business that we have done has not fully compensated for the distribution and syndication of these exposures. But we have also, as you were saying, commented on our experience of a pretty fierce competitive situation in the sector. And I commented earlier on the call that we see this both on pricing and on structure, which is why we have also let certain exposures go and also said no to others, been selected also in many, but also lost a few transactions.

We are, however, working very systematically with growth and future prospects, and there are plenty of opportunities to work on with our countrywide organization across the regions and many industries that are performing well also in today's market. So we're confident that we are competitive and will be able to continue to grow in this segment while also doing so at profitable levels.

Okay. That clarifies. And then second one, I had a look at your shipping portfolio, given what's going on in the Middle East and how it affects both oil and shipping and you're a large bank for both sectors, it was natural to take a look at your crude oil tanker portfolio that's NOK 17 billion out of NOK 54 billion in the shipping book. From what I can see in the fact book, you have no Stage 3 loans at the moment in that segment. And the medium risk category actually declined in size quarter-on-quarter.

Can you just talk a little bit how you view provisioning for this part of the loan book at the moment in light of the war in the Middle East now? Are you reviewing collective provisioning? Or are you still working on an individual loan basis? Are you making more model-driven provisions and so on? Or is it just less of a concern for you overall at the moment.

Thank you, Martin. It's Harald answering. The short answer is it's not a concern to us, several reasons for that. We don't basically do single vessel financing. So all the ship-owning companies we finance, they enjoy very high freight rates at the moment, partly driven by the obstacles in the Middle East. Second, I would like to emphasize is that all the ships we finance that are trapped in the Gulf, they have insurance. If that insurance should fall away, they have what we call a mortgage insurance. And on top of that, most of the ships that are trapped actually are there on the cost of the charters. So this is no concern to us.

Our next question is from Jacob Kruse from Bernstein.

Okay. Just one question. I just wanted to ask Carnegie in Sweden, I think you closed the savings account there as a product. What was the -- is that you shifting into DNB type account? Or are you changing the product mix in that business?

I'm not -- Alex, go ahead.

There are developments on the product side, but savings accounts in Sweden will definitely continue to be a part of the overall product offering, and this is then related on the private banking side.

Okay. Okay. They seem to be in the process of closing on the website.

So we will now move to our next question from Shrey Srivastava from Citi.

Just one for me as well. The NOK 200 million of integration costs for Carnegie that you previously guided for this year, correct me if I'm wrong, but I don't think you took in this quarter. When would you expect to take these maybe even be phased through the year or back-end loaded?

It's Alex here. I can say that we've identified NOK 33 million in the first quarter. And as you correctly point out, the guidance is up to NOK 200 million when we consider it sort of evenly distributed up to that number throughout the year.

Our next question is from Thomas Svendsen from SEB.

So on the CET1 ratio, as you point out, it's the capitalization is strong. Do you think this is over time, what would be the buffer you would like to have above the FSA requirements, which already include all these buffers? And do you think the buyback program, is it -- do you think you have from a practical point of view, possible to adjust the capital with the buyback program?

We completed a 2.5% buyback program in the previous year. And you will find that every time we initiate the buyback program, we find that we have a more than sufficient capital buffer to the regulatory requirements. And as signaled or as mentioned during today's presentation, we have already sent our request to the FSA for such a renewed program this year. So we will, as soon as that is approved, give information back to the market. And I think that sends a signal also in terms of at least we're feeling that there's more than sufficient buffer at the current time.

And just to add to that, I think we agree 18.1% is a very, very robust capital position, 170 basis points, not only above the required, but also the expected level that includes the Pillar 2 guidance of 125 basis points. So it is a buffer on the buffer. And I know some of you have asked us to be specific about the buffer on top. We have not given a specific buffer also for a reason of wanting to be more flexible given that 16.4% already contains a buffer. But needless to say, the capital level we're at today is more than we need as a minimum requirement. We will continue to deliver on our dividend policy that you know well. It does include the buyback, and we will look to how to optimize that -- but I think the final messaging around our capital position is that we will continue to seek to pay out excess capital to shareholders in one way or the other over time.

[Operator Instructions] We'll now take a follow-up question from Riccardo Rovere from Mediobanca.

A couple of follow-ups, if I may. The first one is DNB Liv has paid, if I'm not mistaken, NOK 1.9 billion to the parent company, which has contributed to capital this quarter. Still the Solvency II ratio now, if I remember correctly from your book is 275%. So I was wondering why that is still going up despite the dividend at some point, this should be supposed to go down. So I was wondering whether the amount of dividends that DNB Liv is paying to the parent company is enough to push that number down or at least keep it flat even this has gone up.

The second question I have is, you stated that competition in Norway is fierce, is strong, but is rational. Do you see any reason why the market as a whole, not DNB, the market as a whole should behave differently in case of rate had to go up differently from what we have seen, say, a couple of years ago when rates were definitely higher, a bit higher than today. I mean it's only literally a few months or, let's say, a few quarters since rates have started going down. So I was wondering why the market should all of a sudden change its behavior.

Thank you for your question. I believe solvency ratio is 274%. And of course, that is impacted by rate and rate expectations and the discounting of insurance contracts and varies over time. But you're quite right, for quite some time now, the solvency ratio has been way above the minimum level that we ask or that we require in order to consider paying up to 100% in dividend. This is also a result of the repositioning of the assets in the life insurance company, where we have reduced our volatility towards rate changes and increased the robustness of our ability to deliver on the guaranteed return.

The reason why capital is being freed up. It's also that we have now passed the cap of level of volumes of guaranteed obligations to our customers and the growth that we take on the books are related to defined contribution. Now as I'm sure you also remember, I believe this was the third or the second time before year-end that we paid also extraordinary dividend up to the parent by upstreaming capital from the life insurance business to the parent. And I think we have guided on our previous Capital Markets Day on an aggregate of NOK 30 billion of capital, a combination of results and also freeing up capital in the coming 10-year period from the life insurance business. And I guess somewhere you're asking the question, should we do it even quicker in view of the solvency ratio. We do need approval also from the FSA to upstream the capital extraordinarily. I think we are looking to do this step-wise in a prudent and sustainable manner, but we have systematically shown you our ability to do so, and this feeds into our ability to grow and also our dividend capacity from the parent.

Now I think it's a bit hard for me to answer your second question where you're asking me to predict the capital situation as such. I think we can only speak from experience and what we have seen so far and historically in the Norwegian market. And what we have seen is an increasing rational behavior over time. I think over time is important. And you know that businesses that run targeting profitability. I mean, they tend to adjust over time. And what we have seen is that an increasing number of banks have set return on equity as their most important target also being asked to do so, I think, and expected to do so from their owners.

And I think this is the cornerstone of maintaining a rational behavior in the market. I think historically as well, we have experienced periods where markets are very liquid. We have experienced periods where people are fighting for positions, but we have also seen historically that this has adjusted back once the priority and the intent to deliver on returns again takes priority. I can only lean to what we have seen in the past and the fact that there is nothing structurally happening that leads us to believe differently for what lies ahead.

That's good. And sorry to get back one second to DNB. What I am not thinking, what I'm imagining is not quicker, but actually larger because the number, the Solvency II ratio, you are distributing capital to the parent company, but solvency at the best stays where it was, actually going up, but rates will go down maybe 1 day. So the 275% will get back to 260%. But the number that never goes down. You see what I mean. So I'm wondering whether the NOK 30 billion that you have mentioned quite a while ago, that is still valid or not.

I think what we talked about stays in place. And keep in mind that the solvency is not only historical rates, it's also future rate expectations that are factored into this calculation. I can reiterate the messaging that I said earlier, and this incorporates our activity in the life insurance business. We will always seek to pay out excess capital to shareholders over time. This is very important in order for us to deliver on our minimum required targets on return on equity.

It appears there are currently no further questions at this time. With this, I'd like to hand the call back over to our speakers for closing remarks. Thank you.

Thank you so much. Thank you for your participation and your questions. And we hear from Oslo. We would like to wish you a good day. Thank you so much.

Thank you. This concludes today's conference call. Thank you for your participation, ladies and gentlemen. You may now disconnect.

Good morning, everyone. Welcome to the presentation of the first quarter results for DNB and also welcome to everyone following the stream. Just for information, the emergency exits are in the front and also in the back, and there are no planned drills this morning.

Spring is here. The sun is shining, and we are really eager to present the results for you. CEO, Kjerstin Braathen, will kick off and then our CFO, Rasmus Figenschou, will continue with the details. And there will be time for questions afterwards.

Kjerstin, the floor is yours.

Thank you so much, Even, and a particularly warm welcome, we can say, since it's spring, as Even said, and the sun outside is shining. That, nonetheless, does not mean that there are calm waters around us in the world because this quarter, the turbulence around geopolitics has continued certainly with the increasing conflict and the war in the Middle East. This is something that has led to high and very volatile energy prices and the level of uncertainty is, as we have seen now for several quarters and years, higher than what we have been used to.

Despite the geopolitical backdrop and despite energy prices being higher, the market reactions overall, we would qualify as relatively benign. And the Norwegian economy continues to be resilient in this environment. Business activity overall across the Nordic markets, which does represent the majority of our activity, we would consider at healthy levels and the Norwegian households are robust. So despite a turbulent environment, we are relentless in our focus, which remains with our customers, focusing on giving them good customer experiences contributing with value creation and focus on the business short term and longer term.

As always, I would like to start also with the customer and demonstrate how we are working towards our mission, which is really to simplify life and help our customers prosper. In terms of simplification, we have this quarter launched a new equity trading platform in our digital savings app, Spare. This was launched in March. And already in the month of March, we saw that 1 out of 4 trades in shares were actually done on the platform, and I don't think we can get better feedback from our customers than that, that this is actually contributing both to simplicity and efficiency. We continue to see that our customers are putting their trust in us with their savings and their investments, and this is demonstrated by a record net inflow in our Asset Management business this quarter of NOK 20 billion.

Making it easier for the young children and adolescents to become customers is also something that we've done this quarter. Now young people below the age of 18 can become a customer with DNB in less than 2 minutes. For our Sbanken customers in chat, we have introduced an all AI -- generative AI chatbot, meaning it's not a chatbot that we have trained, it trains itself. And this has rapidly taken over 75% of the responses in chat and inquiries from our customers in Sbanken with very good customer satisfaction.

Across Large Corporates and DNB Carnegie, we continue to see a confirmation of our strengthened position and the offering. First, from Prospera in the Grand Total survey for Norway, where we are qualified as the leading bank in terms of customer satisfaction. And for DNB Carnegie this quarter in equities, where individually, we are #1 in each of the 4 Nordic countries and also with the overall number 1 position. And as always, I am very proud of the efforts that our team put in every day for our customers.

On to the results. The return on equity comes in at 14% this quarter, 15.5% on a rolling 12-month basis. This does represent a solid contribution from all our customer segments and also the macroeconomic development with lower rates than we saw this time last year. We do see profitable growth both in loans and deposits, a stronger development in deposits than loans this quarter. And the growth is offset by repricing effects and also a fewer number of interest days in the first quarter. And NII as a result of this is down by 5.4% compared to the previous quarter.

Net commission and fees is up by 18%. Contributions materially from all various product areas, the strong point, again, I would highlight is Asset Management, where we see a strong net inflow. We see assets under management grow despite values coming down. And we also see a record flow for the past 12-month period. The portfolio in a turbulent environment, again, remains very robust and well diversified. We do not see any structural changes or any negative migration in the portfolio as such. We do book impairments of NOK 644 million in the quarter in all its -- not in all its entirety, but primarily related to customer-specific events and no systematic development in the portfolio. Capital position remains solid, 18.1% core equity Tier 1 ratio, 170 basis points headroom to the required and expected level and a strong earnings per share, we believe, with NOK 6.5 in the first quarter.

The Norwegian economy is impacted by what goes on around us in the world. We are an open economy. We are an economy that trades with others. As a net exporter of oil and gas, we are partly benefiting also from higher energy prices and somewhat less impacted by inflation stemming from higher energy prices than other countries, but we emphasize that there is an increased uncertainty in the environment around us. This has led to growth estimates for the year coming somewhat down, but to what we would still qualify as healthy levels with an expected GDP growth in the Mainland economy of 1.4% this year and 0.9% next year.

Unemployment is something that we follow very clearly and talk to you about every quarter, still a stable level. We would qualify it with 2.1%, and we expect it to stay low and relatively stable in the time ahead of us. We do expect yet again this year to see real wage growth for consumers. This leads to increases in disposable income, and it does support consumption as a key driver for economic growth.

Given the development in inflation that has been more sticky than expected, I think, by both the Norwegian Central Bank and markets, we have seen a shift in the outlook for interest rates during this quarter, both in the messaging from the Central Bank as well as in the messaging from our own team in DNB Carnegie. The outlook for rates is now an expectation that we will see 2 rate increases this year, each by 25 basis points up to the level of 4.5% for the key policy rate, and rates are expected to come down by the similar amount in the year 2027 and stabilize around 4%. So again, in an uncertain world, the robustness of the Norwegian economy continues to be demonstrated as well as the resilience in households, and we do qualify this as a very healthy environment for us to run a sustainable business in.

A few highlights on the customer segments. And I would underline that we continue to see a very solid underlying performance across all of our customer segments in a competitive environment. The growth platform we've talked about in Norway as well as outside of Norway continues to deliver, and we see strongest growth on the lending side in Large Corporates. And in this quarter, the nominal growth in Large Corporates is offset by a somewhat stronger Norwegian kroner. We see a very healthy deposit growth across Personal customers as well as Corporate customers in Norway. In Large Corporates, we are more, I would call it, opportunistic. We qualify pricing towards the cost of funding in treasury and the volumes develop accordingly.

For Personal customers, we see that the activity in the housing market is somewhat more muted this quarter, but I would highlight the very strong results that we see in our brokerage business in Personal customers. I would like to highlight the pace of innovation that we experienced from the team in Personal customers as well as a strong cost control development in this area.

In Corporate customers Norway, last quarter, we talked to you about some larger transactions that were closed towards the end of the quarter in commercial real estate and the plan to syndicate and distribute these. This has been done successfully, both in terms of syndicating to other banks as well as taking out parts of the volume in the bond market. This has impacted volumes along a more stable development of volumes also across the SME market and volumes are slightly down in Corporate customers Norway. We do note a strong growth in other income in Corporate customers Norway compared to the same quarter last year, and this reflects not only an increased level of activity with DNB Carnegie, but also the systematic effort over time to work broadly on cross-selling in this area.

Large Corporates that delivers the strongest growth this quarter comes in at 2.3% for the quarter, 9.1% if we look at the year overall currency adjusted. We are working and making progress in terms of strengthening the team in Sweden, and we are getting positive feedback from that process and also how the cooperation is developing with the team across DNB Carnegie. And we see that half of the growth that we deliver is outside of Norway. And again, I reiterate the robustness and the strong quality of the portfolio and that we do not see other systematic risk outside of customer-specific situations. So all in all, a robust development we see for our customer segments.

We continue to talk about our activity across DNB Carnegie and across wealth management as the key growth drivers in our business going forward. And we saw a very strong start to the year that has been somewhat -- has been somewhat impacted by more turbulence towards the month of March. But despite this, we continue to see that the level of revenue growth both in DNB Carnegie and our Wealth Management business.

One year now after closing the Carnegie transaction, the integration is progressing well, and we continue to reap the benefits from having an improved and more competitive and broader offering towards our customers. We saw a very strong start to the year again across all product areas, I would say, in Investment Banking. With the conflict in the Middle East, we have seen and experienced that some of our clients naturally have decided to postpone some of their investment activity and activity related to stock listing and others, but we have not yet seen this leading to any cancellations of any plans. So the pipeline in the business remains strong going into the second quarter.

On Asset Management, again, I would highlight the strong point being net flows, NOK 20 billion for the quarter, NOK 65 billion for the year. This last quarter, more than NOK 5 billion stems from the retail market. And this is an effort we are systematically working on to grow that part of the business as it's more sticky, more recurring. And we have seen that customers are changing their positions, but they are more comfortable remaining in their investments in the market compared to what we saw during the turbulence that stemmed from Liberation Day during 2025.

So all in all, a robust quarter. And with that, I will hand over to my excellent CFO, Rasmus, who will take it from here.

Thank you, Kjerstin. I will now take you through the Q1 results in more detail. And please keep in mind that for 2025, Carnegie's results were included in 1 month of the first quarter.

We note continued high activity across all segments with FX-adjusted loan growth up 0.3%. Looking at the Retail Personal Customer segment, the growth is up by 0.2%. As mentioned by Kjerstin and as mentioned last quarter to the market, the growth in the commercial real estate was -- had a planned syndication of -- in Q1 and has been taken out with other banks as well as in the bond markets and thus leading to a volume reduction of 1.2%. Within the Large Corporate area, FX-adjusted volumes were up by 2.3%, driven by increasing volumes across industries and across geographies, mainly in low-risk customers. And we see that more than 50% of the growth comes from our international growth platform.

Currency-adjusted deposits were up by 2.6%, driven by positive development both in the Personal customer segment and Corporate customers in Norway. We maintain a strong deposit-to-loan ratio within the customer segment of 73.8%. As in every -- almost every first quarter, activity is slower. This naturally impacts net interest margin, which was down by 7 basis points, ending at 174 basis points. The reduction reflects narrowed combined spreads and other NII not included in the customer segments. Combined spreads in the customer segments were down by 5 basis points, driven by repricing effects, product portfolio mix effects and margin pressure and continued strong competition.

NII is down 5.4% in the quarter. We note that spreads are down by NOK 449 million, where roughly 1/3 stems from the full effects of the most recent repricing in November, roughly 1/3 comes from portfolio and product mix effects and slightly less than 1/3 comes from stronger competition. Higher average volumes during the quarter increased -- offset this with NOK 231 million and then having a negative FX effect of NOK 86 million. The reduction of 2 fewer interest days in the quarter was -- came in at NOK 248 million. Amortization effects and fees are down by NOK 176 million, reflecting lower activity, as mentioned in the quarter. No treasury effects in other NII of roughly NOK 150 million.

Moving on to commission and fees. Our fee platform is strong and well diversified in total, up 18% from the corresponding quarter last year. Real estate broking was up 3%, reflecting strong performance in a slower market where fewer properties were sold compared to Q1 last year. Investment Banking Services was up by 38%. We note strong development despite of market uncertainties. Our pipeline remains strong, as mentioned by Kjerstin, noting though the transaction in recent months have been postponed. Asset Management and custodial services was up by 34% and assets under management were down 1.2% due to high volatility and negative market developments.

However, and more importantly, we noted the positive net flow of NOK 20.4 billion this quarter, a record high, but also a record high when looking at the last 12 months of NOK 65 billion, well balanced between the retail and institutional investors. Money transfer and banking services were down by 17%. We note high customer activity, offset by costs related to payment services and use of credit insurance related to corporate exposures, which is part of our OAD model, driving profitability for the group as a whole. Sale of insurance products was up by 19%, supported by positive development from the non-life insurance commissions and continued strong income from defined contribution in our life insurance business. In addition to what can be seen on this slide, we also note positive momentum in other income with strong results from our life insurance company, DNB Liv, and our non-life insurance provider, Fremtind.

Operating expenses are down by NOK 920 million compared to Q4, of which NOK 51 million is currency effects. The reduction reflects seasonally lower activity as well as a persistent cost culture to drive efficiency. Activity is exemplified by the decrease in expenses related to variable salaries and IT and the nonrecurring effects booked last quarter of NOK 200 million. Low return on the closed defined benefit pension scheme is related to market development contribution and that contributes to lower cost this quarter. The scheme is partly hedged and reflected in our financial instruments. Due to seasonality, the second quarter generally carries higher activity-related costs and as well -- compared to the first quarter as well as the effects from the annual salary increases adjustment from May 1.

Now moving on to portfolio quality, which remains robust and well diversified with 99.4% being in Stages 1 and 2. In the Personal customers portfolio, which accounts for approximately 50% of our exposure, remains strong. We continue to note record low request for installment holidays and fewer loans with interest only compared to last quarter. Impairment provisions in the Personal customer segment is affected by a model adjustment on inputs on consumer finance and the underlying portfolio remains solid. For the Corporate customer, impairments totaled NOK 556 million. The portfolio remains robust and well diversified across industries and geographies. There is no structural change to our portfolio or general negative migration to note.

The impairments in Stage 3 are related to customer-specific situations, and these are typically exposures we've been following over time. And most are -- recent are industries that have been challenging for some time, such as construction. We remain comfortable with the quality of our portfolio.

Now moving over to capital. Our CET ratio -- CET1 ratio remains strong at 18.1% with 170 basis point headroom to the regulatory expectations. It was positively affected by the profit generation in the quarter as well as ordinary dividend of NOK 1.9 billion from DNB Liv. In line with previous years, the AGM on Tuesday gave the Board of Directors authority to buy back up to 3% of outstanding shares and an application has been sent to the FSA for approval. The leverage ratio remains strong at 6.5%, well above the regulatory requirements of 3% and combined with a CET1 ratio of 18.1%, our capital position remains strong and enables us to continue to deliver on our dividend policy and continue to support our customers.

Summing up, we delivered a strong set of results in the first quarter, having return on equity coming in at 14%, cost/income ratio of 38.7% and an earnings per share of NOK 6.5. We also mentioned that for 2026, tax rate is expected to be 22%, but our long-term guiding remains unchanged at 23%.

With that, I thank you for your attention, and we open up for questions.

Thank you so much, Rasmus and Kjerstin. We have a few microphones in the room, please. Yes, Roy Tilley from Arctic.

A couple of questions from me. Just on the -- touch upon the margin side, just on the competitive picture on retail, in particular. Have you -- has it changed anything recently? Or is it kind of still the same pressure? And is there anything similar on the corporate side? That's the first question.

And then a question on funding. So money market rates have come up quite significantly in the last few weeks. So on the funding side, you've already got a rate hike in your funding cost, I guess, and spreads have also widened somewhat. So I was just wondering, are you able to mitigate any of that on pricing on the asset side? I guess, repricing mortgages will be difficult until we get an actual rate hike, but have you done anything on deposits?

And then the third one, just on buybacks. Have you sent an application to the FSA? And if you have, when would we expect an answer?

Thank you, Roy. I can do the first and Rasmus, the 2 following. Competition is fierce. I would say it's gradually intensifying. We've seen that over the past year. It does reflect that there is ample capacity in the market that surpasses the credit demand overall. It is fierce in Personal customers. It's definitely fierce also in Corporate customers in Norway, including in the commercial real estate sector that we usually see when there is capital looking for employment across the market.

Still, we are very pleased to see that there is a high activity and interest coming into the business as such. In particular, we are focusing on our position towards young people. We have 12,000 people buying their first home, young people buying their first home during the course of last year. We continue to see stable to growing volumes even in a competitive market. For us, it's a demonstration of the performance in our team overall, and we are able to continue to grow at sustainable levels, and that continues to be a priority for us, and it will be. But overall, the market is impacted by competition, yes.

Very good. And on the funding side, of course, there is -- when there is volatility, I'm very happy that we have a strong set of treasury team that plans ahead. So for us, we are not affected by the day-to-day developments in that funding. And I will not go into detail of when we move in the market, but we are well funded. And we, of course, when the whole key policy -- well, when the market has moved in total, we are, of course, affected by that, and then that will feed on to our customers. But the volatility that you're referring to, we are funding our way through it, so to speak.

When it comes to the FSA application, we have applied similar to -- as previous years for 1%, and we'll refer to the market when we have their answer.

And just as Rasmus is saying very correctly, we have -- our team has funded a bit early in terms of expecting market development to be more volatile. But do keep in mind that relative to the LIBOR and the money market rate, our position is more or less stable. And this is in view of how our assets and liability size are matched in terms of margin-related exposure to customer versus what we are funding in the third-party market. So there is a slight impact from rate movement. But really, overall, I think you should see that more or less stable.

And then what matters beyond that is, of course, the level of spreads. And coming into the year, we saw the lowest risk premiums that we've seen in a long time. They have come out somewhat, but not to a very large extent. And our goal is always to fund ourselves better than our peers. That increases our competitiveness towards customers, and we continue to see that we get very, very competitive funding.

Thank you. Herman Zahl from Pareto.

Just following up on competition. Could you say something about what kind of peers are driving competition in Norway Corporate segment, specifically? Since it seems like both larger savings banks and your Nordic peers have stepped up a bit.

I think we have a clear principle that we'd rather talk about our performance and not so much specifically about others. I think what we can contribute and shed light on is that it's a broad specter of players that are active in the market. Changes that have been made to capital structures that has improved the position of standard banks as a more general example has taken an impact. We can see that, that has made that category of banks more competitive. Otherwise, there is a larger number of players who are very actively driving competition in the market.

Yes. And then just on some of the core banking fees, I think you mentioned some margin changes in guaranteed on the slides and money transfer fees as well. Is there something structural we should bear in mind there? Or is it mix effect?

It's an element impacting over the past 4 or 5 quarters or so, where we have more actively engaged in ensuring part of the exposure that we provide for some of our clients in larger corporates. So it's an added tool in the toolbox to originate and distribute. So when we look at that on a transaction per transaction basis, the return on the transaction and the customer and then to the group is improved because we have less exposure, but the cost related to this does appear in the commission and fee part of the book and has an impact there.

Thank you. Thomas Svendsen, SEB.

First, a question to commercial real estate. Now that the hope for interest rate declines have diminished and rates are going up, one could imagine that impacts the cash flow and the liquidity for these companies. So how do you look at commercial real estate?

We continue to remain comfortable with commercial real estate, Thomas. But as you know, of course, rates are very important in that sector of activity, and we have followed it closely. And I would say since rates topping out the last time around, there has been a restructuring and a shift in values that now is more or less 2 years back in time where some players that needed to reposition have positioned. We are now going back to interest rate levels we were at not too long ago, at least that's the expectation in the market. We do not see this as a particularly concerning factor related to our commercial real estate exposure overall.

Keep in mind that it is 10% of our book, and it's limited to that. 72% of the exposure is in low-risk customers. It is a diversified exposure across geographies, but mainly concentrated in the larger cities in Norway, and it's diversified across offices, across hotels, across the shopping malls and others. And there is no particular concern that we would like to highlight in view of rates coming somewhat back up again.

Okay. And just a second question on your latest CMD, you said you were targeting NOK 3 billion in gross cost cutting. Now that more than 1 year has passed, how are you according to this target? And should we expect it to be sort of linear over the planning period?

So we are progressing according to plan on that. And we are -- as our cost slide represented, we are working adamantly on the cost efficiency in the bank, and we see numerous specific targets or areas that we're working on. We're not going into detail on that, except that we are progressing according to plan.

But I think roughly, we can share that we feel that we are more or less on track. Our cost-income ratio this quarter is somewhat north of 38%. So it's higher than what you've seen in previous quarters. This is an expected impact from the Carnegie acquisition. We have bought a meaningful piece of business that has a higher cost income component, but an improved return for the business overall. And of course, we acknowledge that it's more difficult for you to follow gross cost-saving initiatives, but you have seen us taking several initiatives in terms of restructuring and making changements to our staff. We are working in areas such as digitization and automation, but I would also add innovation in terms of simplifying and reinventing value chains. And of course, AI is a very important tool for us in this area. Also simplifying business, increasing the magnitude of straight through processing in more complex processes.

I talked about a couple of examples in simplifying life for our customers, and we like doing that. But of course, simplifying life for customers also means improved efficiency for us. So we are on plan. It's not necessarily linear. Of course, we will also see what can be done with AI. That is a moving picture. But I think it's hard to give you sort of any guidance in terms of how you will see it being linear or not.

Thank you. Any questions from the online audience?

Yes, if we can pass the mic to Rune?

We have a question from Markus Sandgren from Kepler Cheuvreux. Nordea recently highlighted that Norwegian saving banks are currently competing quite aggressively, particularly on pricing. Are you seeing and sharing this view? And how is this affecting your ability to grow volumes without sacrificing margins? More specifically, how should we think about the trade-off between defending market share and protecting net interest margin in the current environment?

Thank you. I think we've touched upon parts of this question already, and it is a very important question. We recognize that there is competition in the market. I don't think we would limit it to a specific category of banks. I think we see it more broadly. But we also see that our team continues to perform and that we are able to continue to do profitable and sustainable business. Our growth platform stems across all of our customer segments. This is part of the strength that we have highlighted both in Norway and outside of Norway. And across the sectors, we will continue to prioritize growth.

And I think we have proven that in periods if growth is somewhat slower in Norway, we are able to leverage other parts of that growth platform to deliver profitable growth in the area of 3% to 4%, which we continue to target. Growth in the previous 12-month period has been 3.5% in terms of lending, non-currency adjusted. Currency adjusted, I believe it has been somewhat stronger. And we have seen a growth in Personal customers of 1.6%. We have seen in Corporate customers, 5.6% and then Large Corporates, 5% noncurrency adjusted for the year as a whole. And I think this demonstrates also in what has been a competitive market, our ability to deliver growth. The priority remains very firm also on profitability.

Thank you. Any more questions, Rune?

No.

I think we will close the session, if I don't see any more hands. Management will be available for members of the press, like we always are in the couch area afterwards. And I wish you all a very nice Thursday.

All right. Good afternoon, and welcome to DNB's pre-call close call for the first quarter of 2026. The objective of this call is to remind you of what we already have shared with the market and some relevant public available information that could possibly affect the Q1 results. There will be no new information during this call, and the script for the call will be published on our IR website.

I will start with the NII and capital, and Anne will go through the rest of the P&L. On the NII, there are 2 fewer interest days in the first quarter compared to the fourth. So this is expected to impact the Q1 NII negatively by approximately NOK 240 million. On the lending volume side, we saw average growth of 1% in Q4. Keep in mind that Q1 typically sees a seasonally lower activity level than Q4.

In the first quarter, we've seen the NOK strengthen impacting NII negatively. The FX split in the loan portfolio for the fourth quarter was 8% U.S. dollar, 7% euro, and 7% SEK. The second 25 bps key policy rate cut by the Central Bank in September of last year, and our corresponding customer repricing of a cut of up to 25 basis points on loans and deposits took effect from November 18, meaning that it will have full impact in the first quarter.

With the Central Bank's latest policy rate decision today, where the key policy rate was kept unchanged at 4%, they published an updated expected future rate path indicating that the key policy rate will be hiked by 25 bps to 50 bps by the year-end 2026. The DNB Carnegie's Micro team expect two 25 bps hikes in 2026 in June and September, followed by two 25 bps cuts in '27 in September and December to stabilize at a turnover rate of 4%. We continue to see strong competition in the bank market.

Other NII includes a number of line items. In the fourth quarter, almost all were positive and including a nonrecurring effect of NOK 171 million. As we have informed the market several times, we expect NII to be negatively impacted by a regulatory change related to tax accounts in Norway which came effective on January 1. The loss of deposit volume as a result of this change expected to have a negative annual NII effect of approximately NOK 300 million.

Over to capital. In the fourth quarter, we reported a CET1 ratio of 17.9%, well above the NFSA expected level of 16.3%. Based on FX development in the first quarter, there will be a positive effect on CET1. We repeat the FX sensitivity of CET1. When there is a 10% change in FX, there is an approximately 20 bps change in CET1. Just a reminder, the capital cost of the 0.5% share buyback program we announced in February was taken in the fourth quarter. We have completed the program. The ordinary dividend of NOK 1.9 billion from DNB Liv will be booked in the fourth quarter -- in the first quarter, sorry. This corresponds to approximately 15 bps on in the CET ratio. And then over to Anne.

Sure. Starting with a general comment on net commission and fees and other operating income. Generally, activity levels tend to be lower in the first quarter compared to the fourth quarter, impacting fee levels negatively. And the reminder on net insurance result, this is negatively impacted every year in the first quarter after the introduction of IFRS 17 due to booking or recognition of expected losses arising from loss-making or onerous contracts.

Moving on to financial instruments at fair value, starting with customer revenues in DNB Carnegie or FICC. This typically sees a seasonally lower activity level in the first quarter compared to the fourth quarter and is, of course, also impacted by market volatility. The mark-to-market effects on the AT1s and the basis swaps will be announced shortly after quarter end, as we usually do. And a reminder on the outstanding FX AT1s, we have USD 700 million outstanding and SEK 4.95 billion outstanding.

Moving on to costs. Seasonally lower activity level than we typically see in the fourth quarter, all else equal, typically leads to a somewhat lower cost level in the first quarter. In the fourth quarter, we had nonrecurring costs of approximately NOK 200 million, driven by year-end effects impacting operating expenses, including Carnegie integration costs of NOK 50 million.

As communicated previously, we expect to incur nonrecurring integration costs related to Carnegie of up to NOK 200 million in 2026. Salary inflation in Norway came in just below 5% for 2025. In its latest monetary policy report, the Central Bank expects salary inflation in Norway to come in at 4.5% in 2026.

And a reminder on pension expenses. As previously mentioned, normalized pension expenses are expected to be approximately NOK 500 million in the quarter. And the closed defined benefit compensation scheme is primarily linked to the development in global equities.

Moving on to asset quality. There's no change in our message on asset quality compared to what we presented at our fourth quarter release. The portfolio is carefully monitored, and we are still generally comfortable with the risk in the portfolio. As you know, impairments will vary from quarter-to-quarter, driven by potential changes to macro input factors in the ECL model and/or company-specific events as you've seen in past quarters. As we've said previously, given the elevated level of uncertainty driven by the global macro picture, it would be natural to see more company-specific events.

And finally, a kind request or a reminder to please submit your consensus estimates to Rune by end of business on Wednesday, April 8. That marks the end of our call. We thank you very much for attending and wish you a nice day ahead.

Welcome to the DNB Q4 Conference Call. My name is Alan, and I will be your coordinator for today's event. Please note this call is being recorded. [Operator Instructions]

I will now hand you over to your host, Rune Helland to begin today's conference. Thank you.

Thank you very much, and very welcome to the DNB's Analyst Call for the Fourth Quarter. Present here in Oslo, we have the CEO, Kjerstin Braathen; and CFO, Rasmus Figenschou; Head of Personal Customer, Maria Ervik Loevold; Head of Corporate Norway, Marianne Wik Saetre; Head of LCI, Harald Serck-Hanssen; and of course, Head of DNB Carnegie, Alex Opstad.

Before we open up for question, Kjerstin will give you highlights from the quarter.

Yes. Good afternoon, everyone. Just a few highlights on the backdrop with the Norwegian economy that continues to perform well in a world where uncertainty is growing. The GDP growth this year is expected to be 1.5%, 1.6% next year. We continue to see low unemployment. And this is, after all, I think this single indicator that demonstrates financial stability and health in the Norwegian economy.

Two rate cuts in '25. We believe there will be one more in '26 before the key policy rate stabilizes around 3.75% for the remainder of the forecast period.

Again, uncertainty is not the same as lack of opportunities for businesses in Norway and also sectors that we are involved in outside of Norway. And this translates, amongst others into the growth that you see us delivering in the fourth quarter. But the backdrop is still positive for our business.

The quarter, as such, we are pleased to see that our NII continues to grow even on the back of rate reductions that are also taking effect this quarter. 1.2% growth in NII reflects profitable lending growth across segments and as well as positive contributions from other interest-related elements offset by rate cuts as well as some mix effects on the NII segments.

The real strong point in our mind is fees that grows by more than 40% this quarter. Two very strong contributors is assets under management that has a strong net inflow of NOK 20 billion in the quarter and, of course, also DNB Carnegie with a sharp uptick in investment banking and equities and a high level of activity throughout the quarter.

I would even highlight more the strengthened position across asset management and investment banking, where we have received many proof points of our strengths and positions. Among them, the effect of being the institution that participated in the highest number of IPOs in Europe in '25 as well as the highest volume that was raised in the market.

Costs are up, reflecting high activity seasonally in the quarter and also some one-off elements that we have talked to. And we also chose to highlight the cost development for the year, believing that this is more representative of the development.

If we look at this pro forma, look at the underlying cost development, it's 2.6% for the year, slightly less than the inflation level that we have seen in Norway of 3.1% throughout the year, demonstrating that we work systematically towards delivering on the cost ambitions outlined in the Capital Markets Day.

Strong capital generation in the fourth quarter. Strong earnings per share, up from third quarter, contributing to the basis on which our Board intend to recommend a cash dividend per share for -- of NOK 18 per share for the year '25. We also announced today an additional share buyback program. In aggregate, taking this to a level of 2.5% of our shares being bought back and accounted for in 2025.

After deducting both the cash dividend and this last share buyback, our capital remains very strong, 17.9%, 160 basis points headroom towards the expected and required level by the FSA. So a positive backdrop, a strong capital position, supporting our ability to continue to grow and a commitment to deliver on our dividend policy as we demonstrate again by lifting the nominal level on the cash dividend from what was distributed in 2024.

And from there, we'll take your questions.

Thank you. Operator, we are ready for questions.

[Operator Instructions] We will take our first question from Gulnara Saitkulova, Morgan Stanley.

I have two, please. First one on competition. Can you share your current observations on the competitive dynamics in Norway? And whether you are seeing any meaningful changes compared with the last year? Lending spreads have come down this quarter. At what level do you expect them to normalize? And how DNB is responding to the competitive environment? And what initiatives can help you to offset the pressure on margins?

And maybe here you can -- maybe you can elaborate more broadly, are you prepared to match competitors' pricing actions? Or do you see digital capabilities and service quality as the primary levers to retain customers flow?

Thank you for these questions. In general, on the competitive environment in Norway, we qualify that as strong. I think we have seen and we have said for some quarters that the aggregate capacity and appetite to grow is larger than that of the demand.

Our focus on growth is always profitability. And that is why we're also pleased to say that even in this environment, we are able to deliver profitable growth across all sectors. The strongest contributor in the fourth quarter being corporate customers in Norway and large corporates. And on large corporates, we are, of course, also leveraging our platform to grow outside of Norway and half of the growth delivered in the quarter and for the year stems from our activities outside of Norway.

And again, we often talk about this platform and our ability to leverage these positions. And this is typically a year where you see that being demonstrated.

We always advise you to look at the volume-weighted margins rather than the individual spreads, in particular, in periods where the key policy rates and prices are moving. And there, for the group, you see a decrease of 6 basis points in the fourth quarter. This represents materially the impact of the repricing that has been implemented throughout the quarter. It does also represent in part a mix change, different growth between lending and deposits and also some margin pressure related to the competition we have talked about.

We are, I would say, offsetting margin pressure by leveraging our platform, our presence, our capability across Norway to grow also in times of strong competition. We would not match any price points. There is no need to match any price points as long as we can grow profitably. And we are working on initiatives that we have talked about to reduce time to pay out on mortgages. We have reduced the time for mortgage application and processes by 24% during '25. This is important to customers.

We have facilitated much easier registration of businesses for new companies and onboarding into the bank and reduce the timing of this by 37%. And of course, we actively use our distribution, both digital and physical in order to market and proactively seek growth.

So this will be our strategy going forward. We do not guide particularly on margins as such. I did mention that we do expect to see another cut in the key policy rates towards the summer. And this is likely to believe to have an effective banks continue to also change prices when key policy rates are priced, but we're confident in our ability to, over time, deliver growth and reiterate the ambition to grow 3% to 4% for the group. It's not a max. We did grow by 4.9% in '25. And as long as growth is profitable, there is some flex to this. But the main plan and sort of ambition is the 3% to 4% rhythm, I would say, on the back of the platforms that we command.

Very clear. And just second question, can I follow-up on these other impacts on NII. How should we think about this item going forward? And what are the key underlying drivers for other NII? And should we assume for the next quarters that this benefit is non-recurring?

Well, it's a harder element to give you, sort of, guiding on in relation to other elements related to volume and margins. Because other NII tends to be more volatile from quarter-to-quarter. It's a bucket consisting of many different elements.

If you look at the previous three quarters, it has been a negative delta from quarter-to-quarter. This quarter, we are in a situation where all of these major elements they come into positive territory. Among the categories that are represented in other NII is interest-bearing activity that is not directly linked to lending and deposits. One of the examples being securities finance, another being short-term management of liquidity.

It is also a bucket where any differences that stems from intercompany elimination in the accounting will be visible. And it also bears elements of the non-performing portfolio that can impact the numbers from quarter-to-quarter. So there's no real, sort of, ground rule for indicating the direction or which level it should be at. If you do, however, look at this over a longer period of time, I think you would find that more often than not, there is a stronger contribution in the fourth quarter than in other quarters.

We will take our next question from Sofie Peterzens, Goldman Sachs.

Here is Sofie from Goldman Sachs. So just on the fees, the investment banking fees were very impressive, up over 100% year-on-year and over 60% quarter-on-quarter. How should we think about the sustainability of this fee income line? Is it fair to assume that it could be, kind of, that this was a normalized Q4 level? Or should we expect, kind of, the level we saw this quarter to be a normalized level?

And then my second question would be on the Polish mortgage provisions. Could you please just remind us what the outstanding exposure is? Third, did you take any additional provisions this quarter for that book? And how much the debt provisioning or coverage is?

Sofie, it's Alex here. So, referring to the investment banking fees and the growth that you mentioned in Q4. Well, first of all, Q4 is, of course, a seasonally strong quarter for investment banking normally. And we saw that also this year. But I would say that the activity level was very broad-based. And while we also have some large significant transactions, it was broad based enough to say that we expect that to be a, sort of, normalized level for Q4.

Yes. And when it comes to the Polish portfolio, this quarter provisions is NOK 34 million, which is much lower than last quarter, but this is what we see sufficient for the situation. Currently, the size of the portfolio is NOK 3.4 billion, which -- where the competition is 89% in euro, 1% in Swiss francs, and 10% in zloty denominated.

And sorry, just a clarification. On the Polish portfolio, what was the original, like the max exposure of this, back?

The max exposure, back in time?

Yes.

I don't think -- I don't think we have those numbers. We need to come back with that. But yes, I'm not sure why that would be relevant. I mean, what we're outlining now is the current exposure and the spread across currencies.

Okay. No, because some of the other European banks with Polish exposures are saying -- I mean, if you look at the Polish banks, they have like closer to 200% coverage because they are saying that you basically also going to get claims for loans that have already been repaid. So I was just curious to understand what the size of this exposure at the peak was?

Okay. Yes. No, I think what we can say is that the aggregates that we have taken now is, sort of, our best estimate as to the representative level of impairments.

We will take our next question from Riccardo Rovere, Mediobanca.

A couple, if I may. The first one is, if I remember correctly, and if I understood it correctly, this morning, Kjerstin, you mentioned that in Q4, you somehow experienced some lower margin pressure than in Q3, if I got your comments right this morning. I was wondering if you could elaborate a little bit on what exactly that means?

And the other question I wanted to ask you is, if the loan book is supposed to grow, kind of, 4%, because this is more or less what you have delivered in 2025. This is a fairly elevated number, at least in Western European countries. Doesn't this mean that the pie is large enough for everyone to have a profitable growth without particular margin pressure? 4%, it's fairly, fairly high for Western European standards. So I was wondering whether that comment to you makes sense or not.

And the very, very last one, sorry to get back to what Sofie just asked on Poland. But it's not clear to me if you actually charge some provision in this quarter related to the Polish portfolio. And if that is the case, how much that was?

We charged another NOK 34 million on the Polish portfolio this quarter. You are correct. I did mention an observation that we had seen somewhat lower margin pressure in Q4 than Q3. I would qualify this as a comment related to the fact that we are not seeing the pressure spiraling and rapidly increasing rather than indicating what we expect to see in the future.

My reference was also pointing to the fact that it's not as binary as just thinking about growth versus pricing. I'm quite happy to see the work that Maria and her team is doing in order to leverage our position, our products and our channels, both in terms of physical distribution and digital in order to generate new customers and attract across the services and products we are offering. 3% to 4% growth has been, sort of, our marching rhythm, so to say, some years slightly above, some years slightly below. It speaks to our growth platform more than to the pace of economic growth in Western Europe.

And you know that we have more of a challenger position in other Nordic countries than Norway, which means that we are not as dependent on the growth in the economy overall, and we feel that our offering and capabilities towards clients, it's much improved with onboarding Carnegie across investment banking as well as wealth management. And this is well received by our customers.

Beyond that, we continue to have a very strong brand and offering across energy, across the maritime sector, across healthcare. And these are all industries that are driven by some of the mega trends that we see evolving. And this is the reason why we think we can detach a little bit and deliver profitable growth. If this means that everyone can deliver profitable growth, I'll leave it up to others to judge. But I think we have highlighted that we believe it's the fact that our growth platform is, in fact, a competitive advantage that gives us room and flexibility that others may or may not have.

Okay. Just a quick follow-up on this. Still 3% to 4%, it would be at least, for Norway, less than the nominal GDP. Why should that be the case? Because inflation is 3%, real GDP growth expected to be 1.5%, kind of, is one of your slides, if I'm not mistaken. So we land in 4.5%. Why the largest bank in the country should be growing less than the nominal GDP?

Well, I think you can also add the factor of development of house prices and refinancing activity that fluctuates. And I think if you go back and look at the historic development, it has not been very representative to just combine GDP as well as inflation. I mean, there are other factors that are impacting it. You need to look at credit demand. For one, this has come down somewhat, but credit demand, for example, among corporate customers, Norway in the SME sector, grew by 2.9% last year. We are growing more or less exactly in that rhythm.

If home construction, as an example, does pick up, we don't expect that really to materialize in '26, maybe towards the end and into '27. We wouldn't expect it to materially impact the GDP growth, but we would expect it to impact our growth numbers. So it's a little bit different than just combining the inflation and GDP.

And again, I'm pointing to the international platform. And the rapid turnover we have in the portfolio, meaning that if you took the gross amount that we are underwriting, if we were only looking to add volume we could add much more. But we are very focused on profitability. And the larger looking the clients, the larger the holdings, the more actively, we will also look to syndicate, originate and distribute. So the gross level of business that we're doing where -- which involves also a lot of refinancings of existing commitments is again much higher than the GDP growth.

[Operator Instructions] We will take our next question from Jacob Kruse, Autonomous.

So two questions. First, could I ask on Carnegie. What would be the areas where you found greater success than you had expected in your plan and conversely other areas where challenges were greater?

And secondly, on the NII, just to understand, when we look at this other effect and thinking about 2026 and I guess, Q1. Do you think it makes more sense to start at the Q3 as a base level? Or is Q4 kind of a better starting point? I realize that maybe some, sort of, mix if you can elaborate on that.

I'll hand it over to Alex to answer Carnegie, on the other NII. I'm afraid I won't be able to give you much assistance. You will see that it is a line that fluctuates. I would just reiterate that not having gone back and looked at this quarter, but over time, if you look at several years, it tends to be a lower contribution in first quarter than the fourth quarter, typically because of more eliminations happening also towards the end of the year. And you need to keep in mind that there is also a non-recurring element in the fourth quarter number of NOK 171 million.

Jacob, it's Alex here. So, your first question was what sort of areas have we had greater successes than we maybe foresaw at the outset. And I say we went into this believing really in two things, that the two businesses were a great fit in terms of capabilities. And secondly, of course, that all integrations are difficult and time consuming. And maybe start by highlighting that we are only really two full quarters in combined operations in. So, if we go back to May of last year, really, the focus point has been to bring the organizations together and bring our combined products to our clients and really focus on market position.

If I were to summarize them both Q4 and '25 in that context, we have made very good progress, I think, in terms of market position and the areas that are most affected in a sense by changes in equities and in investment banking.

In equities, we are a very, very clear market leader in the Nordic region, and we do see that the scale benefit that we are achieving is -- will result in more efficiency and a more attractive offer to our clients. I think at the moment, we are ranked #1 in three of the four Nordic countries in that respect.

And in investment banking, we really see that the products capabilities for the two organizations really complement each other. I think I've mentioned before that from the DNB side, we do have a DNA in DCM that Carnegie didn't have and Carnegie have a strong DNA in ECM that we've, for instance, benefited from during the fourth quarter, where Sweden was an active IPO market.

So altogether, we are I think very, very happy in where we've gotten on the client position and the client feedback that we are receiving and then highlight then that it's still early days, and we believe the better opportunities are actually still ahead of us.

And maybe following up on that, Harald, the work together with LCI is -- has been progressing well throughout the year. But I really feel that, that's accelerating at the moment.

And in terms of challenges, I think it is a significant amount of work to bring two organizations together, and that process is very much ongoing. But I think we're making good progress.

We will take our next question from Riccardo Rovere, Mediobanca.

A couple of follow-ups, if I may. The first one is on something that I always ask you, and I always get the answer, is on DNB Liv, the Solvency II ratio is again 260%, around 260%. It was supposed to come down, but it remains -- it always remains 260%. So I was wondering what is the level that you target over the medium term, not 10 years? And is it supposed to be upstream in a faster way the capital that is generated in insurance operations?

The second question is on SRT. I just wanted to have an idea if that have been active and what you have done? If it's an instrument you are actually using at the moment, you have been using in the past. Just a little bit of color on that. And then maybe just a curiosity, given the NOK 171 million one-off in NII, I was wondering what is -- would this refers to? Just a curiosity.

I will hand the SRT question over Rasmus, but I'll briefly respond on DNB Liv. We haven't specified a target specifically for solvency. We have said that if solvency ratio is above 140%, we will distribute up to 100% of the annual results as a dividend. We are very pleased that DNB Liv has managed to quite substantially reduce the volatility in the solvency ratio towards rate changes. So it's vastly more robust than it was.

We had a strong result this year from Liv. Pretax profit of NOK 1 billion for the fourth quarter. And of course, the solvency of 2.6, means that we will stream the 100% -- we are likely to upstream 100% of the results in dividend.

In addition to that, you know that we are in a process where we are gradually paying back capital up to the parent, which strengthens our core equity Tier-1 ratio and our ability, again, to pay dividend to our shareholders. And that amount, I think it was for the third time that we did this in the fourth quarter last year. Now NOK 1.5 billion.

You are asking the question, could we do this faster? I think what we have told you on the Capital Markets Day is that we look to upstream NOK 10 billion -- NOK 30 billion, sorry, in the coming 10-year period. I think that still stands firm. This is a process where we need approval from the FSA when we pay more than 100% of the results. And our focus is really to do this sustainably in a gradual manner that enables us to continue. But I think you're clearly seeing our intention and that is to repay excess capital, and we are now in a situation where the guaranteed portfolio is gradually diminishing.

NOK 171 million, it's non-recurring because you can't expect to see it every quarter. It's still real revenue, but it should have been spread out differently across the year. I think that is what I can tell you, but it's related to real interest income, but you shouldn't expect to see the same kind of delta in the next quarter.

Yes. In terms of significant risk transfer, so we have done one large securitization within the transport area, green transport, in the past. And we are looking at further potential in securitization and other important areas of the bank going forward. In addition to that, we also, and as mentioned during this morning's call or presentation, we use insurance actively to strengthen our originate and distribute on the large corporate side, which this year also became visible on our money transfer and banking fees area. So in terms of SRTs, both on the securitization and on the insurance side.

And Rasmus, do you think you could do -- there will be more room to offload to reduce capital absorption on the back of these? Or you think you are doing what you can do?

We believe there is more potential within securitization, and we are further pursuing that.

We will take our next question from Shrey Srivastava, Citigroup.

Two from me, please. The first is the NOK 200 million non-recurring costs that you saw in the quarter. Could you be a little bit more specific about what these relate to? Is it sort of variable comp or something else?

And the second one is, could you provide a bit more color on the growth, particularly in corporate costs in Norway? And specifically a breakdown between what sort of underlying and what might be shorter term, for example, bridging facilities or something like that would be very much appreciated.

I'll do the corporate customers in Norway, and I'll hand the question on costs to Rasmus. If we look at the growth for the year, because I think that makes more sense. The growth in corporate customers Norway was 5.2%.

Important to highlight that commercial real estate is also part of corporate customers in Norway as well as our regional business with SMEs. And of course, they differ when it comes to pattern and growth. I think what is important for us with SMEs is to continue to see profitable growth. For the year we see a credit growth demand of 2.9%, and our growth is 2.8% in the SME area throughout the year. And we are pleased also to see that a higher number of customers are choosing us as their bank, and we have a material uptick in terms of new customers selecting DNB.

So this also means that the larger part of the growth or approximately half of the growth come in commercial real estate. Several large transactions was closed in the fourth quarter. These are transactions that were composed of underwriting elements with a view to syndicate. And for the major part, these syndications have already been completed after New Year, that is towards the end of this year. This is normal for commercial real estate. So I'm not sure I would qualify it as recurring or non-recurring. We have an attractive book of commercial real estate where we turn the capital around more rapidly than you would typically see in an SME book.

But of course, what this means is that the tailwind that you can see from the quite material growth that came in towards the end of the fourth quarter is not necessarily, sort of, lasting through the first quarter as we are distributing material amounts into the market.

Very good. In terms of the one-off effects on costs, as NOK 200 million, as you pointed to. NOK 50 million of those are attributed to the integration costs of DNB Carnegie. There's also gear and events relating to -- an effect relating to variable salaries that have been sort of accrued differently throughout the year and then ending up in the last quarter and other operational expenses.

We will take our next question from Thomas Svendsen, SEB.

Yes. So a question to the buyback program. You now point to the fact that you buy back 2.5%, including the today's announced program. So -- the question is, how realistic is it to, sort of, manage to execute about 2%, 2.5% per year on this program from a -- or a total share buybacks from a practical point of view?

Well, I think what we can see now is that we are looking to deliver on this close to 2.5%. In terms of going forward, this depends on the total volumes and many variables. So it's hard to describe in the future years where it is. But in -- for 2025, this is what we are able to deliver.

But I think we can add that we've said all along when the Board asked general assembly for a proxy on share buybacks, it's not meant as an indication for the amount. I think we've also been quite clear that we do module, the buybacks according to the volume transacted in the market not as to interfere with the development of the shares. So at some point, there is a practical limit. And as you know, we are now splitting them up into smaller pieces where we need the approval from the FSA.

FSA has been quite efficient in approving what we have required for in 2025. We think that if everything is aligned, there is probably a potential to do some more. But we are not guiding specifically on this. And again, I reiterate that the magnitude of share buybacks in '25 alongside the dividend of NOK 18 per share takes our distribution back to shareholders above 86% of the annual results.

We will take our next question from Riccardo Rovere, Mediobanca.

Thanks again. This must be my lucky day. Sorry. Sorry about that. Sorry to pester you again on DNB Liv. But the solvency capital remains NOK 33 billion, NOK 32 billion, NOK 34 billion, always. So I'm just wondering, has the capital upstreaming started, the part of this NOK 30 billion or not? Because the number is always the same. And NOK 30 billion, and what do you need eventually to -- it's not clear what you need to do it. Is it NOK 30 billion out of NOK 1.2 trillion RWA is more than 2%. It's a big number.

Yes, it's a big number, and we think it represents a great potential to support the dividend capability of the group over time. Again, as long as it's above NOK 140 million, we will repay the results. We will ask the FSA to reallocate surplus capital back to shareholders. This is a relatively new situation to be in, and we're mindful of doing that in a sustainable and systematic manner and focus on the longer term rather than optimizing at any given point in time.

The development of the solvency when you look at it year-on-year, I mean, you have to appreciate that this is something that varies with the interest rate level, with the exposure under the insurance contracts, with the expected returns on the contracts in the future. So it's more complex than just, sort of, taking the capital of last year, adding the result and deducting the extraordinary dividend, if you will.

So these 3 years has been a situation where the performance of Liv has improved. We also mentioned that we have a very, I would call it, solid uptick in our risk results, and the financial results this quarter, which plays into the financial instrument line in the P&L. And this, of course, is something that we will continue to work on. But the focus is to be able to do this gradually, sustainably, but capital and excess capital will be paid out over time.

Sorry, Kjerstin. But the number is always the same. It's always NOK 33 billion. So -- or the repatriation has not started or the number is larger than NOK 30 billion? Because it's quarter-by-quarter-by-quarter.

But Riccardo, I'm telling you that there are more elements that goes into the solvency calculation than the results and the capital reallocation. It depends on the interest rate level. It depends on the exposure on the insurance contracts. It depends on the future expectations of return, and these are only a few elements. I'm sure we can provide you with details as to how solvency is calculated and we'll do this following -- we will do that following this call.

There are no further questions on the line, so I will now hand you back to your host for closing remarks.

All right. Thank you so much for your participation, and we would like to wish you all a good day. Thank you.

Thank you for joining today's call. You may now disconnect.

Welcome, everyone, and good morning. Welcome also to everyone following us on the stream because we are also online with the stream, we need to wait until the right time to start this session. And now it's 9:30, and we are ready to present the results for the fourth quarter and for the full year 2025. We see a lot of smiles in the audience. We hope it's because of the dividend. And I will give the floor to our CEO, Kjerstin Braathen, and also to our CFO, Rasmus Figenschou, for the first time on this stage. We will go through the results, and there will be time for questions after also from the online audience.

Please, Kjerstin.

Thank you so much, Even, and a very warm welcome to all of you, even if it's cold outside to this presentation of our fourth quarter results but where also I would like to highlight some of the key points for the year 2025 as a whole. I think it surprises no one if I say that these are historic times in terms of uncertainty. But we often say also that uncertainty does not mean that there are not opportunities out there for businesses and across industries. In fact, we almost see the contrary. Uncertain times in a bigger picture does not mean either that we need to forget the little things.

And today is an important day for us because of our results but it was also an important day to pick because it's an important day for a few of our colleagues. And in DNB, we like to talk about the importance of people. So first, I need to say that we have also invited you to celebrate Even's birthday today. But more importantly, we have invited you to celebrate Stig, our long-term photographer, who turns 60 years today. So that is an illustration to the DNB team.

In this environment where uncertainty is the new normal, the economy continues to perform well and prove its resilience in Norway. We also see that our customers continue to have a high activity, and they perform well across sectors. We focus on our core with our unwavering commitment to our customers and the development of our relationship and our business with them. We are, we believe, presenting a solid set of numbers today, demonstrating the activity level in the Norwegian economy and also the strategic value of the positions that we continuously build across the business.

I would like to start with a couple of highlights concerning our customers because we like to start with the customer in DNB. First, DNB Carnegie. In 2025, DNB Carnegie was the institution that took part in the highest number and the largest volume of IPOs across all of Europe. The position and the strength of the position is clearly demonstrated by being #1 in the Nordics in investment banking, #1 across equities and #1 in Norway and Sweden on also mergers and acquisitions.

On the retail banking side, we continue to make life easier for our customers. One of the things they achieved in '25 was to reduce the time it takes for a mortgage application to be implemented by 24%. We also note that Montrose, which is our challenger platform for retail savings in Sweden was awarded the best bank in Sweden in '25 and this only after having been in operation for a year. And we are motivated to see that the level of customer satisfaction is on its way upwards across many areas of our operation and that we see the highest level of customer satisfaction in Sbanken after the integration.

For the smaller customers, we have made it easier not only to become a customer in the bank but also in terms of registering your new business with an automatic process and through this, reduced the time consumed by these 2 activities by 37%, more time for our customers to focus on the business and creating value. I am very proud of the team that works very hard to deliver all of these results across the group and creates value for our customers every day.

Key highlights financially for the quarter is a return on equity that comes in at 16.6% in the quarter, driven by growth across lending and deposits but also very high activity in other areas. The return on equity is well above the minimum targeted level of 14%. NII is up by 1.2%, driven naturally by growth in the business as well as other interest income elements, and it's partly offset by mix effects as well as rate cuts that takes effect in this quarter.

Net commission and fees is up by more than 40%, 40.3% from fourth quarter last year, naturally reflecting the integration of the Carnegie activities since then. But I would highlight the fourth quarter with very strong performance across asset management and investment banking.

Our portfolio remains very robust. 99.4% of our exposure is in Stage 1 and 2. There are no negative migration. On the contrary, there are positive development in credit quality in areas such as large corporates but we do book some impairments in the quarter and have a cost of risk of 15 basis points. These are primarily related to specific customer situations.

Earnings per share, up by 9.6% compared to the third quarter this year, for the year, NOK 28.45 per share. And this is thus the basis for our Board's decision to propose a dividend of NOK 18 per share as a cash dividend for the year. This is up 7.5% from last year, fully in line with our dividend policy.

Our capital ratio remains rock solid, I would say, with a capital core equity Tier 1 of 17.9% after the deduction of dividend and after the deduction of an additional share buyback program of 0.5 percentage points that we do announce today, a headroom of 160 basis points towards the expected and required level by the FSA, comfortably to support a growing business as we move ahead, but also to deliver on dividend policy.

The outlook for the Norwegian economy remains robust. Our economists expect a healthy growth this year by 1.5 percentage points GDP, 1.6% next year. Unemployment remains low, 2.2%, and this is the level where we expect it to remain in the coming years. And unemployment is probably the most important factor for financial stability and economic health across the Norwegian economies and households. While inflation is still not fully down at the targeted level of 2%, we continue to see that it comes down. There is also an expectation in the market that the annual wage growth this year will lead to a growth in real wage for most people, and this will continue to drive consumption as a key element to support further economic growth.

We have seen, as you may recall, 2 cuts in the key policy rates during 2025. DNB Carnegie expects another cut in key policy rate in June this year and thereafter, a stable level for the key policy rate. With an additional cut, this would take the policy rate from 4% today to 3.75%, and this is the level it's expected to remain at for the remainder of the forecasting period. While the level of global economic uncertainty remains high, the activity level and the underlying fundamentals for our business and the opportunities that we see for our customers continue to provide a very favorable backdrop for our business as we move ahead.

A few highlights on the business areas and now for the full year of 2025. The growth in lending in '25 comes in at 4.9% across the group. Deposits are up 2.8% for the year. The growth is slightly above the 3% to 4% that we usually indicate. We believe this is a strong point. This is profitable growth. And I think it clearly demonstrates the value of our growth platform where we have talked about having a slightly different position than many, given our growth platform internationally, both in the Nordics but also outside in specific industries. And we see that this growth platform over time enables us to deliver even when the market is in Norway is somewhat slower.

Deposits, on the other hand, 2.8% is slightly below the 3% to 4%. What is important is that the attractive growth in deposit we see comes across Personal Customers and corporate customers in Norway by 7.7% for Personal Customers and 3.9% for our corporate customers. These are the areas where the deposits are the most sticky and the most valuable. There is a decrease in large corporates. This is related to a desired reduce on specific volumes on specific names and not very accretive to the NII. So all in all, 2.8% is also a number that we're pleased with.

On the personal customer side, we've seen a high activity, a growth of 2.2% for the year, a year with a lot of activity also generated by the fact that we have seen rate cuts. The net interest income is up for the year despite 2 rate cuts. And there is quite a substantial uplift in other income by 30.2%, of course, due to the integration of Carnegie but very strong contributions from assets under management and continued increasing quarter-by-quarter of the savings accounts that we offer to our customers.

We see during the year '25 that our real estate broker is doing increasingly better and better. And it's a good reference to note that of the sales that we saw in the previous quarter, we finance 32% of the sales that we have brokered, almost 10% higher than our market share, an element that demonstrates the value of having that type of a business within the group.

Cost-wise, nominally, it's up. If we look at the underlying cost development ex the effects from Carnegie, there is a flat cost development in this area, clearly demonstrating a very strong cost control. For our corporate customers, we also see profitable lending growth, 7.7%. There are growth in commercial real estate but I would like to highlight also growth among SMEs. We do follow that. We like to see that also the broader and regional part of the businesses are growing, which they are at a higher pace than the market. And the growth in NII is accompanied by an even stronger growth in revenues related from other areas than the interest-bearing one.

Higher customer satisfaction, in particular, for the smaller customers that are very attractive to many. We're working hard on that. And during the year, we have seen an uplift in the market share for start-ups, newly established companies by 3 percentage points up to 28.7%, which is a very strong position long term for the business.

Large Corporates, total revenue up 12% and NII growth of 4.4% also here despite the rate cuts. Other income, a strong up 29%, demonstrating the cooperation across with DNB Carnegie, a strong development in asset management and a strong development of the business as a whole. The quality in the portfolio is improved. The impairments across both Corporate Customer Norway and Large Corporates are this quarter related to customer-specific situations but the portfolios and the credit quality remains very robust.

A couple of comments on DNB Carnegie and our business in wealth management. You can see the uptick in revenues that we deliver in 2025. We believe this clearly demonstrates the value in the improved strategic position that we have across these 2 businesses, together with DNB Carnegie. The customer income in DNB Carnegie in '25 is up by 27%. More so, I would say we're very motivated by the strong reception from customers, having experience that we are working on and being awarded many transactions that we have not been -- we not would have been able to compete on if we had not joined forces.

We have received strong recognition of our positions or not even strong recognition, but I would say a strong track record in terms of the magnitude of the business that has been done. And we increasingly see how the organization works well together and markets are active across ECM, across DCM and even across M&A as we enter into 2026.

Wealth management, total income is up by a whole 41.7% from the prior year, NOK 527 billion growth in assets under management. More importantly, there is also a meaningful contribution from flow in this number, NOK 47 billion for the year as a whole, and 40% of this is related to retail volumes. This is a solid development. It solidifies our position as Norway's largest asset manager but it also demonstrates the value of having built a broader position.

We see that we are also continuing to strengthen our share as -- our market share in distribution of funds to the retail segment and see that now NOK 4 out of NOK 10 that are saved in mutual funds in Norway are actually saved in a DNB fund. We're still not even a year into having merged the Carnegie business into these 2 areas, and we continue to look forward to putting our efforts into further strengthening these positions, a broader offering to add even more value to our customers as we move ahead.

Lastly from me, I talked about the dividend and our Board's intention to propose a dividend of NOK 18 per share, which is a nominal increase per share per year, in line with our dividend policy. We have completed 2% buyback. So with an additional 0.5 percentage point of buyback, that brings us to 2.5% and a total payout for the year 2025 of 86.3%. We expect to continue to have a share buyback program with the Board asking the general assembly for a proxy also this time around. We have a strong capital position and ability to support our customers in their future growth and deliver dividend, and we continue to remain very firmly committed to our dividend policy that we have been for many years.

And with that, I have the pleasure to welcome on stage our rock-solid brand-new CFO, Rasmus Figenschou.

Thank you, Kjerstin. I will now take us through the financial results for the fourth quarter in more detail. We noted strong activity across the group with a currency-adjusted volume growth of 2.2%. In the personal customer side, the growth was 0.3% for the quarter. And on corporate customer Norway had a strong lending growth of 5.2%. This was driven primarily related to several specific transactions within the commercial real estate side and is expected to be syndicated and taken out in the bond market during the first quarter of this year.

Growth in Large Corporates and International came in at 2.7%, driven by increased activity across both geographies and industries in mainly low-risk customers. Currency-adjusted deposits are up by 0.2%. Firstly, corporate customers in Norway increased by 4.3%, driven by increased volumes across industries as well as public sector related to increased allocation through the government budget. Both within Personal Customers and LCIC, there is driven by seasonal effects and the underlying development in the portfolio remains stable. We continue to maintain a strong deposit-to-loan ratio within the customer segments of 72.2% in the quarter.

The net interest margin was up by 1 basis point in the quarter, ending at 181 basis points, supported by volume growth and an increase in other NII. Combined spreads in the customer segment was down by 6 basis points, driven by repricing effect, product portfolio mix effects and margin pressure from stronger but rational competition.

NII is up 1.2% for the quarter. The effect from the lower combined spreads showed on the previous slide is noted here with a reduction of NOK 504 million. Keep in mind that in the fourth quarter, we had full effect of the August repricing and partial effect of the November repricing, which will have full effect in this coming quarter. Interest on equity is up NOK 40 million, driven by average increased volumes of equity.

Amortization effects and fees are up NOK 47 million, reflecting higher activity during the quarter. Other NII is up NOK 476 million, of which NOK 171 million is related to nonrecurring year-end adjustments. Please note that from year-end, regulatory change related to tax accounts in Norway, which means that corporates will no longer be required to maintain a separate liquidity buffer in their banks for tax payments. The estimate is to have a negative annual effect on the NII of approximately NOK 300 million.

Moving on to commission and fees. We have a robust and well-diversified fee platform and the performance this quarter clearly signals the potential for continued future growth. Customer activity picked up during the quarter and net commission and fees are up NOK 1.3 billion or 40.3% from an already all-time high in the fourth quarter of 2024. Real estate broking was up 6%, where reflecting higher activity in the real estate market and the number of properties sold came in at 4.7%.

Investment banking services was up by 101%, a strong performance compared to an already strong quarter in the previous year. We note particularly strong performance within ECM, DCM and bank syndication, driven by high activity and several landmark deals in the quarter. Asset management and custodial services was up by 68%. Assets under management was up NOK 88 billion, well balanced between the commercial -- the retail segment and the institutional investors, retail being an attractive segment for us. We noted a positive net flow of NOK 20 billion, also evenly split between the retail and the institutionals.

And finally, we noted a positive development in the number of savings schemes. Money transfer and banking services were down by 25%. The result in this quarter is mainly driven by increased use of credit insurance and LCIC. This is a tool to ensure capital efficiency, driving origination and distribution strategy and ensuring increased profitability for the group as a whole.

In addition, we saw pressure on profits from the used car sales in DNB Finance this quarter. Sale of insurance product was up by 15%, supported by continued strong income from defined contribution in our life insurance business and positive development in the non-life insurance business as well. In addition to what can be seen on this slide, we also noted positive momentum in other income with strong results from our life insurance business, DNB Liv and our non-life insurance company provider, Fremtind.

The strong performance and high level of activity is also reflected in our costs, where operating expenses are up NOK 878 million. The high activity during the quarter resulted in an increase of NOK 330 million in variable salaries. The fixed salary uptick is related to Q3 lower costs due to Swedish holiday pay. Further reflecting seasonally high activity, we noted increasing costs in the next 3 categories on the slide. We also note a one-off effect on NOK 200 million, driven by an integration cost of NOK 50 million as well as year-end effects related to variable salaries and other operational expenses.

To paint the full picture, I also want to highlight the full year cost perspective as well, where inflation outgrew the underlying cost growth. Norwegian core inflation came in at 3.1%, where underlying growth in DNB was 2.6% for the year. The tax rate for 2025 came in at 18.5%. And going forward, as previously indicated also, our tax guiding is adjusted from 20% to 23%. We note integration costs of NOK 250 million in 2025 also communicated to the market in relation to the Carnegie transaction during the year. For 2026, we estimate up to NOK 200 million of integration costs for the same.

At year-end, we have 226 more FTEs than we had at the same time of last year, while at the same time, welcoming 840 new FTEs with the Carnegie merger. This illustrates a considerable gross reduction in FTEs in line with the cost reduction measures communicated at our Capital Markets Day in 2024.

Now over to our portfolio, which remains robust and well diversified with 99.4% of the portfolio being in Stage 1 and 2. The Personal Customers portfolio, which accounts for roughly half of our exposure, remains strong. Continuing the trend over the last few quarters, we note record low request for installment holidays and continued reduction in interest-only loans. For the Corporate Customers, impairments came in at NOK 793 million. The portfolio remains robust and well diversified. There is no structural changes to the portfolio or migration in general to note, negative migration.

The impairments in Stage 3 is related to specific names and specific situations in both LCIC and Corporate Banking Norway. These are typical exposures that we have been following closely and most are in industries that have been challenging for some time, such as residential, real estate, construction. Relating to the legacy portfolio in Poland, we incur a NOK 34 million provision. We remain comfortable in the credit quality in the portfolio but please bear in mind that losses will vary from quarter-to-quarter. I brought that from Ida and continuing on.

Now moving on to capital. Our CET1 ratio remained strong at 17.9% with 160 basis point headroom to the regulatory expectations. Pillar 2 guidelines was reduced by 25 basis points during the year from the SREP. The CET1 ratio was positively impacted by profit generation and the repayment of excess capital from DNB Liv. It was offset by the proposed cash dividend of NOK 18 per share, and the annual operational risk adjustment, which is driven by the average income over the last 3 years.

We recently finalized the previous 1% share buyback program and today announced a new 0.5% buyback program, reducing the CET1 by 19 basis points. We expect that the Board of Directors will request an authorization from the AGM for a share buyback program as they have done so in previous years.

The leverage ratio remains strong at 6.6%, well above the regulatory requirements of 3%. Combined with a CET of 17.9%, our capital position remains strong and enables us to continue to deliver on our dividend policy.

Summing up, we delivered a strong quarter in the with key figures of 16.6% return on equity, 39.7% of cost income and earnings per share of NOK 7.65, an increase of nearly 10% from the previous quarter.

And with that, I thank you for your attention and open up for questions.

So much, Kjerstin and Rasmus. We have some microphones in the audience. Please wait for the microphones before you ask your questions. Anyone wants to be the first one out, Thomas Svendsen, SEB, in this side.

So question to the capitalization. Why are you not using the opportunity today to sort of adjust the CET1 ratio lower down towards the requirements? And is that a signal of your growth opportunities during '26 or maybe some smaller M&As?

We have a capitalization level that remains fairly consistent to what it has been in previous quarter, and it's an ample room to have 160 basis points above the expected and required level. We are proposing a dividend with a substantial uptick. That's in line with our dividend policy. And we are mindful of having the capacity to grow for further growth and also have an intention to continue to do some share buybacks. You will, when you look at the growth in the previous quarter, see that in this quarter, in particular, the growth was very capital efficient. So probably more efficient than it is likely to be over time.

There is no signaling or no change in the way we think about our capitalization. Priority #1 is to support our customers and to grow. And beyond that, we aim to pay out excess capital over time to shareholders, and this gives us an ability to amply deliver on that.

Okay. And just a final question on the growth on the Personal Banking side, it was quite slow in the quarter. Do you have some reflections on that?

In our mind, the growth is not so slow in the fourth quarter. It's usually not one of the strongest quarters in the year. The fourth quarter this year also saw a lower activity in general compared to other quarters because the rate cuts that happened in the second and third quarter generated a lot of activity where customers reoriented themselves where they looked at swapping banks, and we could see a very positive impact on this on our Sbanken brand, which is typically a strong offering in such a situation, whereas fourth quarter is a calmer market where what we primarily see is refinancings and people buying new homes.

We have a decent growth. We have a sound development of margins given the market where competition is strong. So all in all, we're pleased with the performance of the teams throughout the year with 2.2% but also fourth quarter and how the business develops.

Yes, Simon in ABG.

Simon Brun, ABG Sundal Collier. Following up on Thomas' questions but turning to the Corporate side. As you mentioned, strong lending growth in Corporates in the quarter but also for the year, around 8%, well above the market growth. When you -- when you take market share on the corporate side, do you do that without any compromising on the margin? Are you -- are you comfortable with sort of the profitability on that growth? Yes, that's the first question.

Yes. Good question. We are very comfortable with the profitability and the sustainability of the growth. If I start with large corporates, it's primarily a growth in low-risk category of clients, which is also one of the reasons why it's very capital efficient. Bear in mind that half of this growth comes from our international platform. So it's very hard to measure the credit growth and certainly in the specific quarter towards market share. And if you look at our growth platforms outside of Norway, they are industry-specific. And if you look at the Nordics, we have more of a challenger position. So we have a much broader room to grow, and we do this together with our team members from DNB Carnegie, where we have offerings where we package together a broader spread of products. Growth will vary from quarter-to-quarter. But of course, we are very pleased to see that for the year 2025 for Large Corporates, our growth platform enables us to deliver 7% growth.

Now moving to Corporate customers in Norway, there are 2 elements to consider. One is commercial real estate, which is a substantial part of that portfolio. And the other is SMEs. SMEs is where we look at market shares. And SMEs, our growth for the year was 2.8%, I believe, whereas market growth of 1.8%. So that confirms the picture that we have communicated for some years that we are able to take some market share on the SME side due to our offering having competitive advantages amongst others in areas such as the broadness of product [indiscernible]. This is a very profitable business, a complex business to deliver on, which is also why we're happy to see customer satisfaction increase and an increased market share for start-ups.

Competition is strong. we don't win every deal. We are focused on the profitability in the growth. And when we see we're able to deliver on that, we are happy to see that. The area that is still lagging because the growth is lower than what you have been seeing for many years up until a couple of years ago is the construction activity for homes. That has still not picked up. We ask our team every day. And from what I hear now, they are seeing more inquiries for new projects, but it's a little bit early to say how well they will sell, and it's going to take a while before those volumes come back on the book but they will at some stage.

Now in '24, there is also some substantial transactions on the property side, commercial real estate. And this impacts the number, the overall gross number and is also why you cannot read the total number as a market share indicator. Typically, we do the transactions that are more complex that requires delivery of more than just the debt. And fourth quarter growth in Corporate Customers Norway, there are such deals in the numbers. And there are also some of these transactions that already have been syndicated, distributed to the market, which means that, yes, there is a tailwind going into the first quarter but maybe not as strong as it looks at the outset end of year numbers.

Thank you for a very comprehensive answer. Maybe one for Rasmus then on the NII bridge you showed. Obviously, a negative impact on the spreads, which I guess relates to the rate cuts and fierce competition, as you say. But on the other NII, very helpful in this quarter, I guess, and some nonrecurring items. But in general, how should we think of the other NII? Is that untypically beneficial this time around? Or how sustainable is that sort of tailwind from other NII?

The other NII will vary from quarter-to-quarter, as you see, and it's related to non-direct deposit and lending interest income. That could be, for example, on the prime financing, which externally we call...

Securities financing.

Securities financing. Thank you. And within treasury, et cetera. So this quarter, there were some of numerous factors that point to positive. Others, there will be more balanced and sometimes more on the negative side. So I think in some, there is -- we see in this quarter some of several positives playing in on the other NII.

Yes. Herman Zahl in Pareto.

I have 2 questions on costs. So first, you say underlying costs are up by 2.6% year-over-year. So I know you have a cost income target but could you help us with what we should expect on the underlying cost into next year and highlight some cost lines where you think there will be some cost pressure and where you will be able to be more cost efficient medium term?

Cost pressure is related to underlying inflation is obviously driving the costs and FTEs directly hitting that, some of those 2. IT costs are also hit in terms of cost pressure. So the -- looking at -- that's directly sort of the posts that are driving it. For us, I think looking at the year as a whole is much more conducive to looking forward rather than the quarter as a whole. The quarter as a whole -- the quarter, sorry, this last quarter was driven by high activity, as mentioned, also one-offs of NOK 200 million, as mentioned, NOK 50 million being to -- relating to the integration costs and also some year-end adjustments on variable costs, et cetera. So I think looking at the year as a whole is a more correct way of looking at the cost going forward.

So the clear guidance we have, as you're saying, it's sub 40. We don't nominally guide on cost, but I think comments were given on the quarterly development where there are several sort of activity-related elements as well as one-offs. But I think to add to just what Rasmus is saying, the annual development demonstrates that we are underway also in terms of delivering on the cost initiatives that we described at CMD with a reduction of more than 600 employees. So it very much highlights the fact that we are growing and we have specific areas of the business that we're growing, but we're also, at the same time, very much focusing on competitiveness and efficiency.

But then on the parts of the SEK 200 million nonrecurring, just to understand it correctly, some of it is related to sort of accrual of bonus payments and should be seen in the context of the strong fee performance?

Not in the quarter as such but as an adjustment for the year, which is why we're also showing the full year because it's not representative for the quarter as such.

Yes. And then just on the associated companies accounted for by equity method, Fremtind, obviously very strong. And -- but it also seems like maybe other contributions are improving. Could you update on the profitability in Vipps and Luminor or the other contributions there?

I think definitely, Fremtind is delivering very well, and we're pleased to see that new strategy, new management, better pricing. I mean, of course, they've been through the same cycle as many other non-life insurance businesses but we certainly also see strategic effects from repositioning the company, which is working well. They are the largest contributor to associated companies, representing roughly half -- more than half of the contribution. We are not obviously specifically guiding on the other companies but we're seeing a healthy development. Vipps had a positive contribution for the third quarter in a row.

So all of these businesses are doing well. Nothing in particular to highlight or that stands out, and we expect a meaningful contribution for them also as we move ahead.

Thank you. Roy Tilley from Arctic next up.

Just 2 questions from me. Just one quick one on tax. You had a 14% effective tax rate in the quarter, which I guess is that usual tax deductibility of interest expenses. In the national budget, they tried to change that regulation. So just wanted to check if your long-term tax guidance, is that still around 23% or 20%.

That's correct. We affirm the long-term tax guidance of 23%.

So this will be the last year with this effect most likely.

Correct.

All right. And then just on -- just one follow-up on growth and margins. So looking at your lending margins in the personal customer segment, it's down 18 basis points in the quarter, which I guess could be some timing effects, but also the competitive pressure we talked about. So just how do you see those margins into 2026? And if we look at the full year '26, will you -- is your guess that your -- most of your growth will come on the Corporate side? Or are you kind of targeting still high growth -- higher growth in Personal Customers given the backdrop?

Thank you, Roy. We are targeting growth and profitable growth across all sectors, and I think we've proven our ability to do so throughout this year. Now looking at margins and in particular, when rates are moving, it's important to look at the volume weighted to have a representative move. And I think that is -- that's not what is 18. That is a lower number for Personal Customers.

But clearly, as highlighted with the 6 basis points decrease on the margins volume-weighted wise for the group, there is a meaningful impact from rate cuts where they are impacting with a little more than one rate cut for the quarter as such, and there is the rest of the second rate cut that takes effect in the first quarter this year. There is also a mix effect due to higher growth on the lending side than on the deposit side. And there is a competition impact in the margins. There is also the fact that the growth in large corporates happens on low risk, which normally you would expect lower margins.

So there's a mix of effects. I think we could add that we have competitive prices. And our observation on the personal customer activity is that the margin pressure in fourth quarter was less than it was in the third quarter. But we do work very actively and very proactively in terms of leveraging the performance competence and platform, if you will, in order to deliver the growth that we do with the platform we have across all of Norway.

Thank you, Roy. Since it's my birthday, I will allow a second question from Thomas. Go ahead.

Final question, just on the number of employees was slightly down Q-over-Q. So is it fair to assume stability over the next 12 months?

Nice question. We do not guide on FTEs. We guide on costs.

Nice try. Rune, any questions from those working remotely? No, not today.

Okay. So thank you all for joining both remotely and physically. And for those of you who are from the press, there will be a press session in the area outside afterwards where members of the management will be available. And with that, this concludes our session. Thank you so much for listening and being here.

Thank you.

Good afternoon, and welcome to DNB's pre-close call for the fourth quarter. Just to remind you, the reason for this call is to remind you of what we have already shared with the market and some relevant public data, which could possibly affect the fourth quarter results. There will be no new information during this call, and this script for the call will be published on our IR website.

I will start going through the NII and capital, and Anna will go through the rest of the P&L. Starting with the NII, there are the same number of interest days in the fourth quarter as in the third. So there will be no impact of day counts in the Q4 NII.

On the lending side, on the lending volume side, the Q3 growth was plus 0.3% FX adjusted. Statistics Norway reports a fairly stable development in credit demand since the end of Q3 for both household and corporate. For November, last 12 months household growth was 4.5% and the corporate growth was 1.8%.

In the fourth quarter, we've seen only small FX developments on the average FX, so we expect to see minor effects on the NII. The FX split in the loan portfolio for third quarter was 8% U.S. dollars, 7% euro and 6% Swedish kroner.

The policy rate was cut by 25 basis points from 4.50 to 4.25 in June, and our corresponding customer repricing of a cut of up to 25 basis points on loans and deposits, took effect from -- took effect from August 25. Meaning that it will have full effect in the fourth quarter.

Furthermore, the Central Bank cut the key policy rate by another 25 basis points in September and our corresponding customer repricing of a cut of up to 25 basis points on loans and deposits, take effect from November 18. Meaning that it will have partial effect in the fourth quarter.

DNB Carnegie expect one additional 25 basis points cut to the key policy rate in June this year. To end at the terminal level of 3.75. With its latest policy rate decision in December, the Central Bank published and updated monetary policy report, which included only very minor adjustments to the expected policy rate cut.

We continue to see a fiercely competitive environment. One one-off, we will book at technical collection of other NII of approximately negative NOK 80 million in Q4. As we inform the market in November, we expect NII to be negatively impacted by a regulatory change related to tax accounts in Norway, which became effective on January 1, 2026. The loss of deposit volumes as a result of this change, is expected to have a negative annual NII impact effect for DNB of approximately NOK 300 million.

So on the capital. In the third quarter, we reported a CET1 ratio of 17.9%, well above the NFSA's expected level of 16.6%. Based on the end of period FX development in the fourth quarter, there will be only a minor positive effects on the CET1 ratio. We repeat the FX sensitivity on CET1 where there is a 10% change in FX, there is an approximately 20 bps change in CET1 ratio.

Just as a reminder, the capital costs of the 1% share buyback program that we announced in October was taken in Q3. And so far, we have completed more than 70% of the current program. As you know, we received the NFSA annual SREP decision in mid-November. The Pillar 2 requirement remains unchanged, but the Pillar 2 guidance was reduced by 25 basis points from 1.25% to 1%. The decision took effect from December 31, 2025.

As we did last year, we expect higher REA volume for operational risk, as a result of higher income in the last years. REA volumes for operational risk is adjusted once a year as a calculation of average income over the last 3 years. So in Q4 2024, the CET1 effect was negative 32 basis points.

Year-to-date, we have reserved 60% of retained profits, reflecting the average of the last 3 years' payout ratio. This will, in Q4, be adjusted to reflect the actual proposed payout ratio for 2025.

And then over to net commission and fees. [indiscernible].

Sure. Thanks, Rune. Starting with net commission and fees. Generally, activity levels tend to be higher in the fourth quarter compared to the third, impacting fee levels positively.

Moving on to financial instruments at fair value. Customer revenues in DNB Carnegie, FICC typically sees a seasonally higher activity level in the fourth quarter compared to the third quarter, but is, of course, also impacted by market volatility.

The mark-to-market effects on the AT1s and the basis swaps have already been announced. The basis swaps were a positive NOK 83 million, and the FX AT1 were a positive NOK 248 million. And a reminder on the outstanding FX AT1 amounts, we have USD 700 million outstanding and SEK 4.95 billion outstanding.

Moving on to costs. A seasonally higher activity level that we typically see in the fourth quarter compared to the third, all else equal, typically leads to somewhat higher costs in the fourth quarter. DNB Carnegie's macro team expects salary inflation in Norway to come in at 4.8% for the year 2025.

As communicated previously, we expect to incur nonrecurring integration costs related to Carnegie of NOK 250 million for the full year 2025. And year-to-date for the third quarter, we've seen such nonrecurring costs of approximately NOK 200 million. Keep in mind that we had seasonally low holiday paid disbursements in Sweden in the third quarter of approximately NOK 45 million.

And finally, on cost, a reminder on pension expenses. As previously mentioned, normalized pension expenses are expected to be approximately NOK 500 million per quarter and the closed defined benefit compensation scheme is primarily linked to the development in global equities.

Moving on to asset quality. There's really no change in our message on asset quality. The portfolio is still carefully monitored, and we are still generally comfortable with the risk in the portfolio. As you know, impairments will vary from quarter-to-quarter, driven by potential changes to macro input factors in the ECL model and/or company-specific events as you've seen in past quarters.

And as we've said previously, given the elevated level of uncertainty driven by the global macro picture, it would be natural to see more company-specific events. But again, we do not see any systemic areas of concern in our portfolio. And finally, a kind request or a reminder to please submit your consensus estimates to Rune by close of business this coming Friday, January 9.

That marks the end of our call. We thank you very much for attending, and we wish you a nice day ahead. Thank you so much.

Thank you.

Hello, and welcome to the DNB Q3 Conference Call. Please note this conference is being recorded. [Operator Instructions] I will now hand you over to your host, Rune Helland, to begin today's conference. Thank you.

Thank you very much, and a warm welcome to all of you. Welcome to DNB's analyst call for the third quarter. Here in Oslo, we are, in addition to Kjerstin and Ida, we have Head of Personal Customers, Maria Ervik Loevold; and Head of DNB Carnegie, Alex Opstad.

Before we start the Q&A session, Ida will give you the highlights for the quarter. Ida?

Thank you, and hello, everyone, and thanks for taking the time to listen into this call and participate. The Norwegian economy continues to perform well, and we're also seeing that the recent updates stemming in terms of new data points shows that GDP growth will be higher than what was expected before. GDP growth this year is expected to come in at 1.8% and then continue to grow around 1.3%, 1.5% in the coming years. Mainland corporate investments continues also to show a positive outlook and also more importantly, when looking at the surveys done with the corporate customers and the corporates overall around Norway shows a very positive sentiment.

We noted higher real wages last year and also continue to see that real wages are expected to increase also this year, of course, supporting both purchasing power, but also lending growth overall. Unemployment levels remains low at around 2%, and that is, of course, also positive when looking at the potential in terms of loan growth going forward as well as consumption ahead. The Norwegian Central Bank has decreased the key policy rate twice by 25 basis points and now have a key policy rate of 4%. Our economists believe that there will be one further rate cut in June next year, which means that we will level out on a key policy rate of 3.75%, a very healthy level also for an economy such as Norway.

When turning to the quarter, we delivered a solid third quarter result with a return on equity of 15.8%, earnings per share of NOK 6.98, an uptick of 2.8% from the last quarter and year-to-date, an earnings per share of NOK 20.81. In the quarter, we saw net interest income coming down by 1%, impacted by the key policy rate, customer repricings and product mix effect. We saw a positive and profitable loan growth in all customer segments, but mainly pointing to Personal Customers increasing by 0.4%, Corporate Banking Norway being relatively stable this quarter also due to the fact there wasn't any major uptick in terms of new builds of houses. Large corporates increased by 0.5%. But underlying in that portfolio, there was significantly more movements than what you can see in those numbers. So actually, the activity picked up also during the quarter.

On deposits, we saw an increase of 0.6%, a seasonal decrease in Personal Customers and increase in Corporate Customer Norway also seasonal linked to the public sector. Underlying SMB customers, we had an uptick in deposits of 2%. Large corporate had an uptick in deposits of 8.5%, driven by 1 less tax payment within the oil industry. We continue to see a good and solid and well-diversified fee platform. Net commission is up 28.9% from the corresponding quarter last year. Underlying asset under management growth was NOK 54 billion in the quarter, net NOK 15 billion due to the fact that we also divested the Holberg portfolio in the quarter. There is also a strong activity and investment banking pipeline moving into the fourth quarter, but also good activity on the equity capital markets side, not the least as well as debt capital markets in the quarter where we saw a significant uptick towards the end of the quarter.

Our credit portfolio continues to be robust and well diversified. 99.4% of the portfolio is Stage 1 and 2. Of the total impairment provisions taken this quarter of NOK 862 million, Poland accounts -- the legacy portfolio in Poland accounts for NOK 281 million and the model adjustment of the expected credit loss model impacting Stage 1 and 2 in Personal Customers as well as Corporate Customer Norway amounts to NOK 150 million. That means that the underlying impairment provisions of the portfolio -- customer portfolio is NOK 431 million. There are no systematic changes in the portfolio. And overall, both the Personal Customers segment as well as the Corporate Customers segments are performing well and show a very solid development. Core equity Tier 1 of 17.9%, 135 basis points above the regulatory expectation, also taking into account that we today launched a new share buyback program of 1% in addition to the one that was completed during the third quarter.

So with that, thank you for your attention, and we open up for questions.

[Operator Instructions] The first question today comes from the line of Martin Ekstedt from Handelsbanken.

So I just wanted to ask about Poland loan loss provisions. You see that there's been surprisingly little disclosure around this in recent quarter given the size of provisions. I think in Q2 -- sorry, in Q1 this year, you just said it wasn't very material. Then in Q2, you said you took NOK 152 million, but mentioned that this was lower than the undisclosed amount you took in Q1. And now you took an additional NOK 281 million of losses this quarter then. So that means you've taken well north of NOK 0.5 billion in '25 alone, right, which has elevated your loan loss provisions ratio at least from my calculation, 3 basis points.

So I mean, provisioning for the FX part of the Polish lending portfolio seems to be just below 50% now based on what you said in the call earlier. Are you comfortable with this level of provisioning? Or is there possibly more to come? And what do you think you would just benefit from giving some more numbers on this? For example, I mean, the ECL adjustment of NOK 150 million, you've got the bullet in the credit quality slide of the presentation deck, right? But this Polish provision, which is almost twice the size it was already mentioned in [indiscernible] I mean, wouldn't it be better to just give a slide on this showing what you've taken in each quarter and how provisioning has evolved and so on?

Thank you so much, Martin, and we'll take your feedback into account and hear what you're saying. If we look at the Polish portfolio, as we've said before, this is related to a legacy currency portfolio, of which we have total outstanding loans of NOK 3.7 billion, as you rightly point to. 88% of that portfolio is in euros, 2.3% in Swiss francs and the remaining is in zloty. We have taken accumulated provisions of NOK 1.6 billion related to this portfolio. The reason why we've taken added provisions this quarter as well as the last -- the previous 2 quarters has not been in relation to change of activity among the customers, but more the fact that we have taken different approaches in order to try to solve this situation and really see how we can work with it.

In addition to the fact that we, of course, follow this portfolio very closely in terms of movements and also actions from -- reactions and actions from the customers. The impairment levels that we have taken today are in line with our best estimate given the information and also the development we've seen in the portfolio and also the development overall. So it's impossible for us to say if there will be more impairments or if it will not because that would have meant that we would have to take that today. On the other hand, if we continue to see a growth momentum in terms of solving these issues, that will also impact impairment provisions going forward. But today, we are very comfortable with the levels that we've taken, but follow this closely also ahead.

The next question comes from the line of Markus Sandgren from Kepler Cheuvreux.

So first one on commission income following the downturn this quarter. I think you've said that you expect to have a 9% growth in the coming years. And I was thinking there is less than half that comes from Corporate Finance and Asset Management and the rest has been at least historically growing pretty slow. So what -- I mean, if you -- could you elaborate a bit on how do you see this commission income pan out in the coming years? What should we expect from Corporate Finance, for example, in terms of growth year-on-year?

I can start by giving some more general comments and then maybe ask Alex to give some more flavor on this quarter. I think it's a substantial and growing portion of the fee and commission that stems from asset management and investment banking. And those are also the key engines that are fueling the growth that we do expect and talk about when we talk about expecting above 9% growth on an annual basis. I think if you trail back and adjust for changes in accounting principles, you will see that our trailing growth pace over previous years has been somewhere between 6% and 7%. So that should be a representative number for what the before -- looks like before the Carnegie transaction that is.

And then we will not be able to break out for you the expectations related specifically to Investment Banking or Asset Management. But needless to say, they need to be at an annual pace above 9% in order for us to deliver on the 9% in total fee and commission. Rationale is slightly different if you look at investment banking versus asset management. But from my side, I will refer to the complementarity of the businesses, the strengthened offering, the platform that we now have as a leading Nordic bank and also judging from the feedback that we already see from customers and the position that we have across RFPs and mandates that we see coming in that confirms the business rationale as we have seen it.

Asset Management, I think the strength of the platform is demonstrated also this quarter with an increase in assets under management by NOK 54 billion and divesting a sizable volume like Holberg isn't even visible in the numbers. We again also talk about a record high level of savings agreements, which is one of the main engines related to the retail area, where that, in addition to the defined contribution are very sticky and continuously growing amount, adding attractive assets to our total base on a monthly basis. So I think these are the drivers. And yet again, compared to historical pace with some changing accounting principle that makes it look less out of the box, the real sort of growing number has been between 6% and 7%. But Alex, maybe you can add some more flavor to this quarter.

Thank you, Kjerstin. Well, first of all, to say that I guess it's 366 days exactly since we announced this combination. And the starting point was a very, very good fit in terms of the complementarity that you talked about, Kjerstin, both in terms of geography, in terms of products and in terms of sectors. And we feel that, that has played out as expected over, say, the course of the 6, 7 months where we have been one combined entity. If we look at the business in the quarter, stronger in terms of capital markets, both on ECM and DCM and a little bit softer on M&A, if you ask about Corporate Finance in particular, especially the ECM momentum was strong towards the end of the quarter and into October.

As you know, Carnegie has an incredibly strong ECM platform that's been a driver of their business over -- for many years. If you, for instance, take the 30 largest IPOs in the Nordic region in the last 5 years, we combined have been an adviser on all of them, and we've led 25 out of the 30. And that's perhaps the area where we see the most visible business momentum at the moment, but only, say, one significant IPO closed in the third quarter, and that was the IPO of NOBA in Stockholm. And then we've seen significant market transactions into October, most notably the IPO of Verisure that listed in Stockholm on the 8th of October. And I think that's a good example of sort of synergies or business that one or the other firm wouldn't be able to do on their own because it was a combination of products that got DNB Carnegie invited into the RFP.

And of course, a fantastic effort and outcome both for the company but also for the legacy ECM Carnegie platform that brought this company to Stockholm in what is then the largest IPO in Europe in the past 3 years and the biggest one in Sweden in 25 years. So we do feel that there are significant successes that sort of validates the merger rationale, and we look quite optimistic upon our sort of positioning.

And if you look at the investment banking across the Nordic region, using data from Dealogic, year-to-date, we are a very clear #1 across products then ECM, DCM, M&A and loans. And our market share is, I guess, more than 50% larger than #2. So we do feel that the sort of business logic is being validated every day, and we do feel that we do get a lot of positive feedback from clients and that sort of makes us optimistic for the continuation. And then lastly, maybe just to highlight, it's still early days. We've been a combined sort of entity and brand operating since May. And it's going to be -- in some sense, this will always be a bit of a transition year because it takes time to build this business together.

[Operator Instructions] The next question comes from the line of Shrey Srivastava from Citi.

First, I'd like to say thank you to Ida for answering all of our questions over the last few years. I'm sure it can't have been easy. My question now, I want an updated assessment on the competitive dynamic for mortgages in Norway. I know this is a key feature of last quarter. And you mentioned you were prioritizing sort of margins over volumes. What is your updated assessment after the third quarter results? And how do you see the change in the dynamic from the change in risk weight floors?

Sorry, in terms of the changing dynamics on the competitive landscape, first of all, I think it's important to look at -- on the Personal Customers side, we've always talked about a strong competitive market, but rational. And we continue to say that the market is indeed rational with all the largest players focusing on profitability above growth. On the other hand, you also see that there is growth in the Norwegian market compared to other markets in our neighboring countries where there are less limited growth. That means that a lot of the Nordic players are also focusing on positioning themselves in the Norwegian market.

So what we're saying is that there is continuous strong and fierce competition and perhaps a bit elevated also in the periods where there are rate changes, which is also natural due to the fact that the customers then become even more active in looking at the loans. Having said that, I think for us being the largest player and also maintaining the position as being the largest player with a good room -- headroom above the second player is important for us and also shows that we have continued to focus on profitability above growth, and we'll continue doing that also going forward. If you look at the Corporate Customer segments, we are also seeing strong competition on the -- especially on the small and medium-sized enterprises. But again, I would point to a strong rational behavior and the same goes for large corporates, where there aren't really any changes to speak of in terms of competitive landscape.

And maybe just to add, since you mentioned specifically the risk weight floors. Naturally, this has increased the competitive edge or cost of capital, if you will, related to mortgages for the standard model banks. And we do see some impact of that insofar as they are slightly more aggressive in the market. We are not particularly concerned by that. It's just one piece in the element of competition. They represent roughly 20% of the market. And I think it's tough to grow as a small bank regardless. So it's not anything that we expect to materially impact the total picture overall.

The next question comes from the line of Sofie Peterzens from Goldman Sachs.

This is Sofie from Goldman Sachs. So my first question would be on your exposure to U.S. renewable energy. There was a press article maybe a couple of weeks ago where the regulator was kind of looking, I guess, at your U.S. renewable exposure. Is there anything you can add here? Do you see any risk for any higher risk [ weight ] for this exposure class or anything else that the regulator potentially could do? And if you also could just let us know how much exposure you have to U.S. renewables.

And then my second question would be, we have now heard a couple of other banks kind of talk about the need to invest maybe a little bit more to grow top line. Does DNB see any need to make any additional investments to grow revenues over the coming years?

So if we start with the report that came from the NFSA. -- and as you all know, the NFSA make all the reports public, and that's why some of them make headlines in terms of Bloomberg, and I think this is what you're referring to. What the NFSA pointed to in their revision of our U.S. operation was that we have had a relatively strong growth in the renewables area over the past few years. They also pointed to the fact that in a situation where you're growing in areas that are, in their view, new and unexplored not for DNB because we have a 15-year experience from working in this industry and understanding the industry, they are pointing to that there are, of course, risk factors, both geopolitically, political risk and other factors that we need to take into account.

We are not seeing anything in that report and also not in the discussions with the regulator following that report or that examination to say that we would need to change our models related to renewables. We are very comfortable with the position that we have there, the exposure that we have in the U.S. and the exposure that we have overall in renewables, which has been an area that we also believe that we can fill an important role globally, bearing in mind our know-how. The power and renewables portfolio accounts for 4.2% of total EaD in the group. And I think it's fair to say that we are seeing less activity in the U.S. renewables portfolio today than what we did a year and 1.5 years ago, and that we expect to continue to see also going forward. The growth that we're seeing today is more related to the U.K., for instance, where we're seeing carbon capture storage initiatives as well as other wind projects being initiated in other parts of the world rather than in the U.S.

And just to add, when Ida talks about 15 years of experience, that's 15 years of experience doing renewable renewables outside of Norway. If we look inside of Norway, we probably have 100 years of experience given the fact that all energy in Norway practically are renewable, the one that we are consuming. You asked the question related to the need to invest in order to grow. We have invested in Carnegie. That has given us a tremendous platform to grow our activity in the Nordics. Beyond that, I would not say that we have a material investment need in order to be able to deliver the growth that we have talked about targeting for the future.

The next question comes from the line of Thomas Svendsen from SEB.

So a question to the corporate, the lending markets -- lending margins in the corporate customer segment in Norway. So several of the smaller banks launching this growth ambitions in this segment, while you are disciplined, showing no growth this quarter. But do you think it's fair to assume that sort of the equilibrium margin above the LIBOR is lower to sort of get growth in this segment given the competition?

I think it's a very sort of challenging question to give a straight answer to if you're taking the corporate market as a whole, all the way from SMEs up to the larger ones or maybe you're asking midsize and larger ones. I would not say that one quarter is sufficient to judge this at all. I think local banks cooperating and regional banks going national certainly adds into the competitive picture, but still within what we would define as a rational framework. If you look at the volumes, yes, in Corporate Banking Norway, they are flat end quarter to end quarter. But I reiterate that when we look at the regions, we do see growth in 4 out of 5 regions in Norway and a healthy development of the portfolio.

So performance-wise, we are more or less on par with the growth that we have been used to delivering, lacking, of course, the volumes related to house construction activity. So I'd say there's no concern there, and we believe this continues to be an attractive area for growth. Talking large corporates, if you look at 12-month growth, it's 10.2%. We always say that you need to look at more than 1 quarter. It can be choppy from quarter-to-quarter in view of the very rapid turnover in this portfolio with a duration of less than 2 years. The quarter that we have just reported on also held high activity on refinancing, in particular, substantial takeout of several bridge to bond facilities. So I would not confirm that we see what you describe as a trend to be a trend, and we're comfortable with our ability to continue to grow profitably across these 2 areas.

The next question comes from the line of Riccardo Rovere from Mediobanca.

Two or 3, if I may. The first one, I just want to get back to the initial question, Polish provisions. But just in Poland, one of the reasons I believe that why today, the share price is down 4% is because, a, almost NOK 1 billion of provisions were not expected. Now your level of provisions is not only larger than that of the other Nordic banks, but it's also much more volatile. Now you have almost NOK 3.9 billion of expected loss deduction in your capital already deducted. Did you ever consider to increase the coverage ratio to take provisions in the P&L, maybe in Q4 in all the areas where you see some problems given that this would unlikely affect your capital, given that, that stuff is already deducted in one way or the other, so to make that line of the P&L a little less volatile. And that should not even impair your ability to pay dividends because that thing is already deducted. It's almost NOK 4 billion. It's a fairly large amount deducted from the capital base already. This is my first question.

The second question is in -- with regard to risk-weighted assets, if you -- if I strip out the impact of the floors on the mortgage book, risk assets are kind of flattish or maybe even a little bit down quarter-on-quarter. So I was wondering if you had any mitigation, if you executed any mitigation action in the quarter, SRTs, anything like that? Then I have another question on deposits in the large corporate. I don't know if [ Harald ] is on the call or not, but deposits in the large corporates have gone down quite significantly. Okay. I understand the seasonality, but the seasonality seems to be much, much larger this year than what I have on the back of my mind.

And then I have a very, very final question, if I may. I mean those are facts. Whenever you report numbers on a quarterly basis, and this is not a criticism, this is nothing. It's just that. That day, the stock generally is down like today. Now is that a problem for you? Do you see -- do you think is this disturbing for you? Or you think maybe you could change something in your communication on anything to prevent that basically 3x out of 4, the share price is down whenever you report the numbers?

Thank you, Riccardo. I'll leave the 3 first ones to Ida. But on the last one, let me just be very, very clear that we do not manage our business in view of expectations for share price development in one way or the other. And we do our utmost to be as clear and transparent as we see fit with regards to communication. And in general, the feedback that we get from most of our owners is that we have detailed, transparent and very open reporting. We believe that our focus should be on building a valuable business work systematically, which is what it takes in this business in our experience to create value for customers and through that actually create value for shareholders. And we believe that needs to be assessed over time. And if you look at the statistics over time, that is a fairly good testament to us having done exactly that. With regards to the other 3, I will hand it over to Ida.

Yes. Thank you, Riccardo, for your questions. In terms of -- I think it's important to say that over the past 15 years or even longer than that, we have worked quite diligently on diversification of the portfolio. That has taken down cost of risk over time. And we've also seen that, that's kind of if you look at it average 5 years, that has meant that we've taken down cost of risk from 21 basis points, which was the average then down to 12, 14 basis points. And this quarter, the underlying cost of risk is 8 basis points. Then, of course, I can see that there is always challenging to see that there is model adjustments. Expected credit loss model is expected to be updated on a general basis -- on an ongoing basis.

We have today and this quarter updated our expected credit loss, which is also in line with the expectation from our external auditor as well as the regulators. And this is something that we do on an ongoing basis to ensure that we also link it to your first question, in terms of management overlays. I know that other banks are working with significantly larger management overlays. Our understanding of IFRS 9 and also in close dialogue with the external auditors is that, that's not something that they prefer to see and also not something that is in line with the regulatory requirements on IFRS 9. But then I can see your point from an analytical point of view that, that would make it a lot easier in terms of seeing that there is less volatility, but that's not how we have interpreted regulatory regime and also not how our external auditors have interpreted.

When moving to your second question in terms of risk-weighted assets, yes, there is indeed a decrease. And if you look at Stage 3, you can see that there is a significant decrease in overall exposure in Stage 3, which is related to a sale of an exposure that was there for quite some time and therefore, reduces risk-weighted assets. And then you can see that, that's also, to some extent, being changed with low-risk exposure in the large corporate area. We are continuously working with securitization. As we talked about a year ago, we did the first securitization, and we are also now looking at new opportunities within securitization, which will be an important tool also going forward in order to ensure that we optimize the capital position and utilize the capital in a smart and efficient way as possible.

You also point to your last question in terms of large corporates and the deposit volumes there. It's true that underlying it's a decrease of 0.7% in the quarter. FX adjusted is an increase -- sorry, it's an increase of large corporate deposits of 7.4%. FX adjusted, it's an increase of 8.5%. I believe you might have then talked about the corporate customers in Norway when you said that there was a decrease. Am I correct in assuming that?

LCI over the year, I think.

No, it was actually LCI because if I look at your fact book, the amount of deposits in LCI was [ NOK 512 million ] in -- this is Q1, went down to [ NOK 462 million ] and now it's down to [ NOK 450 million ]. I don't know, maybe it's the dollar. The dollar has an effect here, maybe.

A very large amount of our deposits in the large corporate area is, first of all, time deposits. And second of all, it's dollar-denominated. So therefore, you will see an effect of that. As we mentioned in the second quarter, we had a larger decrease in deposits related to a few customer-specific situations in the large corporate area. Some of that has come back this quarter. But again, these are volatile deposits that are not as important from a funding perspective, but are still very profitable for the bank and therefore, it's something that we continue to work on as being part of the proposition to the large corporate area.

But overall, in terms of margin development and underlying growth on an NII perspective, these deposits are not as relevant for us as other deposits which is important then to look at when you look at the corporate customer area, for instance, where we mentioned earlier today that the underlying growth in the SMB segment is up 2%, while you see a decrease this quarter related to the public sector, which is again low-margin deposits.

Okay. If I may, just a very, very quick follow-up. When you mentioned the Verisure IPO, that was, if I'm not mistaken, more than EUR 3 billion IPO. So it's kind of more than SEK 30 billion IPO. Your role was, not mistaken, global joint coordinator, so it was not junior at all. Am I right in saying that you could book hundreds of millions of NOK in fees in Q4 on the back of that? If I may ask.

I guess there are -- it's Alex here, Riccardo. Thank you for your question. It's correct. So this was a very significant transaction, as I mentioned, the largest one in Europe, I believe, since the Porsche IPO in 2022. And the role that DNB Carnegie had in the IPO was one of 3 lead banks and the other 2 were U.S. global investment banks. And this will be a good event for our business. And it's Q4, as you say.

We currently have no further questions. [Operator Instructions]

If there are no further questions, we will thank you for your valuable questions and wish you a nice day. Thank you very much.

Thanks. Bye.

Thank you.

Thank you.

Good morning, everyone, and welcome. Welcome to everyone also watching us on the stream, this will be the presentation of our third quarter results in DNB Group, and we are looking forward to present the results for you. Kjerstin and Ida will go into the details shortly.

The emergency exits are in the front you left and in the back. But there are no planned drilled today. So if there is a fire alarm, it's for real.

So there will be questions later, both here in the audience and possible to ask questions for those watching on the stream.

And I'll just leave the floor to you, Kjerstin, to get on with it.

Thank you very much, Even, and a very good morning to all of you, and a warm welcome to this presentation of our third quarter results. We are presenting a strong set of numbers, reflecting the summer season where a couple of months are slower for parts of the activity of our business. But overall, steep and increasing activity towards the end of the quarter. The Norwegian economy continues to do well, and this is well reflected both in the customer activity across our business, but also in the robustness of our portfolio.

I wanted to start by sharing a few highlights from the quarter. The first 1 actually after the quarter because only a few days into the fourth quarter, the transaction related to listing Verisure on the Stockholm Stock Exchange closed. We had the honor of being a global joint leader of this transaction. And it was the largest listing in Stockholm in more than 25 years, the largest listing in Europe since 2022, and it marks the strengthened brand and platform we have with DNB Carnegie.

Our assets under management continues to grow to a record level, NOK 1,579 billion, driven by market valuation and net inflow, and we continue to grow despite having sold Holberg in the quarter.

One of the key drivers is successfully launching new products. We have launched 4 new products so far this year, and this has driven NOK 5 million of -- NOK 5 billion of net inflow.

Making life easier and simpler for our customers is something that we always strive for. And this quarter, we have launched several new initiatives, 1 of them a fully digital process not only to register your company but also onboard your company in the bank. And each of these processes, saving our customers 18 days in the process.

By using amongst other, artificial intelligence, we are also simplifying the customer journey across services and across our platforms. And this has within the last year, led to an 18% reduction in number of service inquiries by our customers. And as usual, I do think it's appropriate for me to give a big shout out to the organization that works so hard every day to deliver on our mission to make life easier and the economy better for our customers at large.

Now maybe over more to the numbers. Return on equity for the quarter at 15.8%, which is well above our targeted return of minimum 14%.

The net interest income in the quarter is down by 1% compared to the previous quarter. This number is positively impacted by growth both on the lending side and the deposit side and offset by repricings that have been done and taken effect during the quarter as well as product mix effects.

Net commission and fees, a strong 28.9% increase from the corresponding quarter last year. Key engines or drivers, if you will, are investment banking and asset management. In Investment Banking, we see high activity across ECM, DCM and a somewhat lower contribution from M&A this quarter. Asset Management already referred to record numbers and attractive both market valuations and net inflow into the business.

And other area that stands out very positively this quarter are our activities on the insurance side, both in the life insurance and the non-life insurance.

Costs are down, reflecting our continuous efforts to increase efficiency and scale. We have a robust and well-diversified portfolio across industries and geographies. We do take impairments of NOK 862 million this quarter, but it is important to highlight that impairment on the underlying activity is for NOK 131 million, which corresponds to a cost of risk of 8 basis points.

Core Equity Tier 1, 17.9%, 135 basis points headroom to the FSA expected level. And this number also reflects a reduction of 40 basis points related to the additional 1% share buyback that was announced earlier today.

Earnings per share up 2.8% from previous quarter. Year-to-date, a total of NOK 6.98, year-to-date NOK 20.81, a solid platform to continue to deliver on our dividend policy.

A few comments on the Norwegian economy. New data and economic update has shown that growth was higher than thought actually in the first half of the year. So the growth estimates for the year has been updated and is now believed to come in at around 1.8%, a very healthy level of growth, and it's expected to stay roughly at this level for the coming years.

Unemployment remains low and the regional business survey that is published by the Central Bank supports both the growth outlook and the unemployment with a very positive results.

Inflation continues to move down. With lower inflation, high wage growth, we see drivers for increased consumer spending, which is an important driver for further economic growth.

The Central Bank decided to cut rates for a second time in September this year. Ahead in the forecasting period, the expectations of DNB Carnegie is for 1 more rate cut to take place and that to take place in June next year taking the key policy rate level to 3.75% and thereafter, stay at that level for the remainder of the forecasting period.

Needless to remind you, the world is an uncertain place these days with geopolitical tension around us, more importantly, the robustness and the resilience in the Norwegian economy continues to be very visible, and this is what matters the most for our business.

A few highlights from the main business areas. An additional strong quarter from Personal Customers, 2.7% growth in lending year-over-year and a quarter where there's been a high interest from customers in not only financing new homes, but also looking for a new bank and many of them selecting DNB and our Sbanken brand who have had the strongest growth in a quarter in a month that they have seen for more than 15 years.

Attractive revenue and Other income, strong cost discipline and very low losses leads to attractive return on capital of 19.6% for Personal Customers.

In Corporate Customers Norway, volumes at the end of the quarter are relatively flat. They do increase if we look at the average volumes throughout the quarter. And the underlying activity and growth across regions are positive with growing demand and growing volumes, driven primarily by seafood and somewhat energy. There is a solid contribution from Other income, in particular on the life insurance and defined contribution pension this quarter. Also here, cost discipline, certain customer-specific impairments have been taken, but even so a return on allocated capital of above 20% for this part of our business.

In Large Corporates, pretax profit is down compared to the previous quarter. And second quarter is usually a slower quarter, in particular, in Other income, where we are comparing to a record high quarter third quarter 2024, which was also impacted by positive market-to-market effects. Volumes are up by 0.5 percentage points. Underlying activity is, however, stronger in the business. There's also been a high activity in refinancing, typical transactions related to bridge to bond, which indicates a strong activity related to new business to get to the 0.5 percentage points growth. Year-over-year growth on lending here is 10.2%. A solid contribution from Other income certainly on ECM again and DCM, but also here, we see the lower contribution from M&A.

Wealth Management revenue in this area continues to grow.

In the Nordics, we are building on our strengthened growth platform. If we take DNB Carnegie and look at the rolling 12-month revenue, it's up by 12.3% compared to last year. This is driven, of course, by the Carnegie acquisition, but also high activity on the ECM and DCM side.

Equity capital markets are open. We do see an increasing number of RFPs and mandates coming in. And we are expecting to see more of the business materializing after having been pushed out in time after the trade turmoil earlier this year.

Wealth Management, again, we see a revenue compared to last year, that is up by 26.8%, a key driver, obviously, market valuation, but also very attractive flows into the business. And of course, the acquisition of Carnegie with Carnegie Fonder and Private Banking in Sweden that broadens our platform.

Because I would like to highlight that even more importantly than this quarter is the strengthened growth platform that we have across these 2 business areas.

The position stands out very strongly with a clear leading position as the Nordic Investment Bank. We have done 3 of the -- we have been a leader in 3 of the 4 largest IPOs in Europe so far this year. And in equity research, we hold the #1 position in 16 out of 21 sectors and are among top 3 in the remaining sectors.

For assets under management, it's a broader platform, well positioned for further growth.

And then it's time for me for the last time to welcome my copilot for several years on to stage for the last time. And it is also more than appropriate for me on behalf of DNB to thank Ida for her service and commitment to our activity, our business and our shareholders for many, many years across different roles where she has added substantial value in so many characters.

So Ida, the stage is yours.

Thank you, Kjerstin. And thank you to the entire team for allowing me to be here for 18 years. It has definitely been the best 18 years of my life so far. So thank you all.

Now moving over to the third quarter. We note good activity across the group with currency adjusted profitable loan growth of 0.3%. We continue to see a good momentum in the Personal Customer segment, where the lending volumes were up 0.4%. And as Kjerstin pointed to, with an uptick of growth towards the end of the quarter.

Corporate Customer Norway was stable in terms of lending volumes. But this segment is, of course, also impacted by the fact that there's continues to be a low activity in the construction of new houses, which is usually a strong engine for growth in the corporate customer area.

Large Corporate and International are up 0.5%. This does, however, not fully reflect the underlying development in the portfolio, where we're seeing several larger bridge to bond transactions being taken out in the quarter and good momentum in terms of new businesses.

Currency-adjusted deposits were up 0.6%. The decrease of 1.8% in the Personal Customer segment are driven by seasonality. The reduction is, however, lower than what is usual for a third quarter and should also be seen in connection with this good increase we're seeing in asset under management from the retail customers.

Corporate Customers are down 3.9%. This is driven by a seasonal effect related to the public sector where there is a monthly -- where there is no monthly contribution from the state to the municipalities in August, but it is so for the remaining months of the year. The underlying deposit growth in Corporate Customer Norway is actually up 2%, which is, of course, a positive testament to the momentum in the overall society.

Large Corporate and International saw an increase by 8.5%, predominantly driven by the fact that there was only 1 petroleum tax payment in the quarter. We continue to maintain a strong deposit-to-loan ratio within the Customer segments of 73.6% in the quarter.

Net interest margins were affected by interest on equity and other NII and is down by 5 basis points. Combined spreads are stable. The underlying development in combined spreads are somewhat weaker than what can be seen here related to product mix effects and continued strong but rational competition in the market. For instance, Large Corporates, we noted a high margin bridge bonds, as mentioned before, being replaced by lower-margin loans. In the Corporate Customer area, we also saw a decrease in low-margin deposits stemming from the public sector being replaced by larger, higher-margin deposits from the SMB segment.

Net interest income decreased by NOK 162 million in the quarter. Volume growth and FX effects increased NII by NOK 142 million, and 1 additional interest day contributed positively by NOK 129 million. Spreads are affected by the rate cut, product mix effects, as mentioned before, and continued strong but rational competition in the market.

Interest on equity is down by NOK 202 million, affected by changes in the money market rates and lower average equity following the dividend payment made in May as well as the concluded share buyback program.

In the fourth quarter, we will see full effect from the first repricing being implemented 25th of August as well as partial effects of the second repricing being implemented mid-November.

We continue to benefit from a robust and well-diversified fee platform. Customer activity picked up throughout the quarter and in addition to what you can see on this slide, we are also noting positive momentum from the DNB Life Insurance business as well as the non-life insurance company, Fremtind, as you can see on Other income.

Net commission and fees on this slide is up NOK 878 million or 28.9% from an all-time high third quarter last year.

Real estate broking was up 9%, reflecting the higher activity in the real estate market.

Investment Banking Services was up by 73%, driven by the inclusion of Carnegie and a strong deliveries within equity capital markets and growing so also from debt capital markets.

In M&A, as Kjerstin mentioned, activity was lower than what was noted in the similar quarter last year, but particularly related to the maritime industries as well as energy.

In Investment Banking, we note a solid pipeline within equity capital markets as well as debt capital market, where several transactions already have been completed in the fourth quarter, and more mandates are expected to come.

Asset Management and Custodial Services was up 67%. There was a continued growth in asset under management in the quarter, net up NOK 15 billion when adjusted for the sale of the Holberg divestment.

Underlying asset under management was NOK 54 million in the quarter. And we noted positive net inflow from both Personal Customers, the retail segment as well as institutional customers. And we continue to see a positive development in terms of number of long-term savings schemes.

Guarantee commissions were down by 6%, driven by lower demand for trade finance.

Money Transfer and Banking Services were down by 19%. The positive contribution that we're seeing from the seasonally higher transaction and international travel activity was offset by costs and reduced contribution from banking services.

Banking Services was, among other things, impacted by fewer cars being sold from DB Finance and also insurance premium costs related to exposures in Large Corporate and International. The latter is a tool used for capital efficiency increased originate and distribute and also generates overall profitability to the group.

Sale of insurance products was up by 21%, supported by continued good income from defined contribution in our non-life -- in our life insurance business, and positive development also in the non-life insurance business.

Moving on to costs, where operating expenses are down by NOK 242 million, reflecting seasonally lower activity. Fixed salaries are down by NOK 126 million quarter-on-quarter, NOK 45 million of these are related to seasonal effects in our Swedish operation where the vacation days are deducted from previously accrued costs. The rest relates to fewer full-time employees in the group.

This quarter also includes one-off costs amounting to NOK 55 million, of which NOK 25 million relates to the announced decrease in number of full-time employees in our operations area and NOK 30 million to the integration of Carnegie.

Over to portfolio quality, which remains robust and is well diversified with 99.4% being in Stage 1 and 2. We note impairment provisions totaling NOK 862 million in the quarter, NOK 150 million of these relates to an update of our expected credit loss model. This impacts impairment provision in Stage 1 and 2 in the Personal Customer segment as well as in the Corporate Customer segment.

In addition to that, we have taken NOK 281 million of further impairments related to our legacy portfolio in our Polish -- in Poland.

Impairment provision as Kjerstin mentioned, in the underlying portfolio amounts to NOK 431 million, equivalent to cost of risk of 8 basis points.

The overall portfolio in the Personal Customer segment as well as in the Corporate Customer segments are strong with no signs of deteriorated quality.

In the Personal Customer segments, there are fewer customers with installment holidays and defaulted loans today than what we saw a year ago.

In the Corporate Customer segment, we have fewer customers on watch list, and we continue to see a good momentum.

The impairment provisions in Stage 3 for Corporate Customer Norway related to customer-specific situations in the same sectors as we pointed to before, namely real estate related.

The overall portfolio quality here continues to be sound and robust with a limited portion of the exposure in high risk. We remain comfortable with our credit quality in the overall portfolio.

And now moving on to capital. The Core Equity Tier 1 capital is strong at 17.9%, 135 basis points above the regulatory expectation. The Core Equity Tier 1 was positively impacted by profitability, 30 basis points, which was offset by the increased risk weight floors in the residential mortgage portfolio, leading to a reduction as announced previously of 60 basis points.

We finalized the previous share buyback program during the quarter and are today announcing a new 1% share buyback program impacting the Core Equity Tier 1 by 40 basis points this quarter.

Leverage ratio remained strong at 6.3%, well above the regulatory requirement of 3%.

With a Core Equity Tier 1 of 17.9% and a leverage ratio of 6.3%, our capital position remains strong and enables us to continue to deliver on our dividend policy.

So summing up, we delivered a strong set of results in the third quarter reflected in these key numbers. Return on equity came in at 15.8%, earnings per share at NOK 6.98, 2.8% increase from the last quarter, cost income at 37.4%.

And with that, I thank you for your attention, and we now open up for Q&A.

Thank you so much, Ida. Thank you, Kjerstin. So this is the last chance you have to ask Ida difficult questions. Any questions from the audience?

To Ida.

Yes, Roy from Arctic.

So Roy Tilley from Arctic Securities. So a couple of questions. Just on the customer revenues in DNB Markets, they were a bit down year-on-year and also the year before. Is that expected? Or are you surprised? That's the first question. I think there was NOK 700 million this quarter. So it's 20% down versus Q3 '24.

And on the activity levels after the September rate cut. I remember after the June rate cut, you had record high activity on mortgages. How was this in September? Was it the same or less this time around? I can start there.

1 more, actually. On Poland, just the legacy portfolio, can you just remind us how big is that portfolio? How big is the provisions now? And should we see more?

Thank you, Roy. I'll do the 2 1st ones, and Ida can do the latter. Third quarter DNB Carnegie is a good quarter, but it's a lower quarter than same quarter last year. And this -- we see strong areas such as DCM, equity capital markets in DCM, particularly on the investment-grade side. If you look at customer revenues, it's also on the fixed side that there is lower activity, lower activity related to interest hedging and somewhat lower on FX. And these are natural volatility for that part of the business, I would say.

As for M&A, it's typically the part of the business that varies from quarter-to-quarter. Third quarter last year, particularly active driven by, as Ida was saying, the maritime sector and transactions in the energy sector, an exceptionally high quarter for us. And this piece was lower in the third quarter.

So there's nothing that stands out that we would like to comment, rather emphasize the strong growth platform and that this business needs to be seen over a longer time than a quarter, and we're very happy with the development and what we see going into the fourth quarter.

Activity level after September was also very strong. Hard to say if it's exactly at the same level, but we continue to see that customers are focused on what their terms are, where they do their banking. And we think that's a very positive thing. It's healthy competition, and it does remain rational. And of course, we were delighted to see that so many customers wanted to come in and join Sbanken. But even in the DNB brand, we have seen a 10% increase in financing certificates. So this is a strong September and end to the quarter for all of our business in the Customer segment related both to pricing but also to the offering at large.

And in terms of the loan book in Poland, we have a total loan book of NOK 3.7 billion, of which we've taken accumulated impairments of NOK 1.6 billion as of today.

What's important to say, and I'll give you a bit more details in terms of the portfolio, 88% of the portfolio is euro loans and only 2.3% is Swiss franc loans, which is exposed in terms of the recent developments we've seen in terms of rulings from the court.

The reason why we're taking larger impairment this quarter as well as last quarter before that is not due to the fact that the customer are changing in terms of behavior or anything like that, it's related to our proactivity towards the customers where we've tried different solutions really to find a long-term solution here, which is impacting the impairment provisions, but not underlying development in the portfolio.

We are continuously monitoring the development and are comfortable with the impairment provisions that we've taken overall related to this portfolio as of today.

Thank you. You can toss the mic to Thomas Svendsen from SEB.

So on the capital, this big difference between your posted CET1 ratio and the FSA expectation. Should we expect that to come down over time, let's say, the next 2 couple of years? That's the first question.

And second, as you pointed out, there are sliding corporate -- large corporate lending margins. Is this a trend that we should expect to continue throughout the next few quarters?

In terms of the Core Equity Tier 1, you're right, we have a good buffer, 135 basis points per the regulatory expectation. What needs to be also taken into account when looking at this number, is that we have a Pillar 2 guidance of 125 basis points within that expectations, which is significantly higher than our Swedish peers, which I believe is around 50 basis points.

So we have a buffer on top of the buffer so to say, and therefore, we are also very well capitalized where we are today, and that's also why we are launching a new share buyback program.

We haven't changed our dividend policy. That stays firm. We're going to continue to focus on an increased nominal cash dividend year-on-year and utilize share buybacks as a flexibility tool to optimize the capital position. But where we are today, I would say that we are very well capitalized.

And in terms of LCI and the lending margins. As I pointed to, and Kjerstin also mentioned, we're seeing some movements within the portfolio in terms of larger bridge to bonds, which have higher margins being taken out in the quarter and being replaced by lower margin and also low risk in large corporates.

In addition to that, there is a fierce competition out there. There is a lot of very solid, well-capitalized banks out there, which, of course, also has an impact in terms of the overall market developments. But this quarter, it's predominantly the impact of the fact that we're shifting large portions of transactions which are different in terms of lending margins.

And we do not see a basis to be able to call it a trend.

Any more questions? Herman Zahl from Pareto.

Just on the competition within PC, Personal Customers currently. Since lending spreads are up by 16 basis points. So it seems like you have given some more repricing downwards than would be suggested by the conventional 25 bps and that your communicated repricing effective date. So -- and you're not growing that much in the quarter either. So I know you're stating and saying that competition remains rational. But would you say it's less rational than it has been historically?

The key theme is that it is rational, but it is slightly intensifying. I think we've been very clear on that. And I think it's well known that the magnitude of liquidity in the market at the moment surpasses demand. However, I believe it's important to be cautious while reading spread movements and directly transferring them to repricing movements as the margins in the statistics are based on the money market rates. And they move and bear in mind that we've had 2 rate cuts within relatively short period of time, and you will see lag effects just as we did on the way upwards, you will see lag effects as money market rates tend to move prior to the adjustment from the Central Bank. And again, there's a lag before the price adjustments become effective into our numbers. So there is competition.

I would qualify the growth in the quarter as attractive given what we've seen statistically. And given what we see in September. And given what we see also in the wider market. This is a quarter where I at least I'm very happy with the performance of the team and reiterate that year-on-year is a growth of 2.7%, and it's at profitable conditions.

And just given that some of the -- sort of more challenger banks in -- within Personal Customers have grown quite strongly since the rate cuts. Could you give some color on how you how the Sbanken volumes have developed since the June rate cuts?

We do not give sort of details across our brands. We believe the key importance and our priority is to deliver a profitable growth in the area, and that is what we do this quarter. When looking at percentages, it is important to keep in mind that we have doubled the volumes of the second largest player in the market, and there is a strong culture for amortizing in the Norwegian market. So just keeping volumes means having a very high level of activity and growing volumes even beyond that. And we are grateful and appreciative of the fact that so many new customers choose to bring their business to us.

Any questions from the online audience? No. There's 1 more from Roy, please. [ Simon Rune ], ABG.

Just a question on your costs for the quarter. Ida, I think you mentioned that was mainly driven by the drop quarter-on-quarter is mainly due to seasonal effects. But I think Kjerstin, you said there's also some structural aspects of it in your introduction. So which 1 is it?

And in relation to that, you have NOK 3 billion cost savings program ongoing until '27. Can you say something about how you're tracking towards that with -- yes, close to 1 year already done?

I would say in terms of your first question, both are right. When I talk about it was more quarter-on-quarter where we're seeing the seasonality effect and that's more to also talk about what we're seeing in the fourth quarter, which is expected to have a higher seasonal element into it.

What Kjerstin talks about is, of course, that we continuously work on cost efficiency. We use digitalization and increased automation. That's also 1 of the reasons why you're seeing a decrease in full-time employees in the operations area is driven by increased automation and efficiency.

In addition to that, we are now kind of benefiting from the full impact of the reduction of 500 full-time employees that we launched last year or announced last year, which is, of course, also impacting long term in terms of the overall -- the underlying cost development.

So when you're talking about the NOK 3 billion, this is something that we embed in how we do business on an everyday basis, and cost efficiency is really embedded in our culture and continues to be a very important tool also when looking at competitiveness, not at least in the mass market and then both on the Personal Customer side but also on the Corporate Customer side.

Yes. So trying to quantify how you track...

I would say we're tracking in line with what we expected. Actually, a bit kind of better than that being said that we then decreased the number of full-time employees already this year of 500.

And Roy, you had 1 more question?

Just a question on insurance. So as the Fremtind, the results in the quarter, they were 76.4% combined ratio. They're tracking well below the target they had for 2025. So I know it's kind of a benign summer quarter for insurance, but it's starting to get very profitable again.

So 2 questions. Firstly, are -- is this the level you expected? Are you happy? And secondly, if it's good enough, are you prepared to start taking some volumes again? You think kind of -- is the premium hikes behind us now? Will competition increase? Or is there still more to do?

In terms of the non-life insurance business, I think what we have seen in Fremtind is also showing their results today. I would say that the team under Hege's influence has done a tremendous job in terms of focusing on increased profitability, cost efficiency and also focusing even more so on the distribution the banks.

And this is also what we're seeing this quarter a closer collaboration between the Personal Customer segment with Maria as well as the Corporate Customer segment with Marianne in terms of how we can collaborate even better in terms of selling more towards our customer and making it even more digital and more seamless for the customer.

So we are seeing a positive uptick on the non-life insurance company business for DNB as well this quarter. And I hope that, that will continue also with a strong sentiment and the driver we're seeing from Hege and the team in Fremtind.

All right. Thank you. I haven't seen any more questions in the audience. So then we will close this session. And for the journalists in the room, there will be time to meet management after this session. Today, we are rigging for the DNB next conference tomorrow outside. So the journalist interviews will be in the area just behind us.

Thank you so much for joining us online and physically, and have a nice Wednesday.

Thank you.