VILNIUS. AB DNB Bankas, a member of Norway's largest financial services group, earned an un-audited net profit of LTL 81.0 million in 2011 according to the preliminary unaudited data calculated according to International Financial Reporting Standards. The bank's 2011 pre-tax profit before provisions was LTL 157.2 million, a rise of 11.9 percent year-on-year.
In 2010, the bank recorded LTL 122.6 million net loss as its pre-tax profit before provisions was LTL 140.5 million.
"The bank met the targets set for 2011 – we successfully completed integration into Norway's largest financial services group, consolidated our position in Lithuania’s retail and corporate banking market, and after two years break operated profitably. Increasing operating efficiency, proper management of the quality of the loan portfolio as well as active and consistent efforts to deliver high quality financial services that correspond to customer needs were the main driving factors behind the financial result achieved. That gives us strong foothold going forward. Although we anticipate that the country’s slower economic growth this year is likely to reflect on the operating environment, we feel quite positive about 2012 and intend to continue concentrating on further development of our customer centric business model," Bjornar Lund, the president and the chairman of the management board of AB DNB Bankas, said.
In 2011 AB DNB Bankas' income grew due to the continuous focus on operating efficiency and its efforts to optimise operations as the bank’s operating costs went down. The bank's operating costs went down 5.1 percent year-on-year down to LTL 176.5 million and its income rose 2.2 percent to LTL 333.7 million. In line with the increased operating efficiency, the bank's cost to income ratio (CIR) improved to 52.9 percent in the year 2011.
As a result of continuous focus on service quality and consistent efforts to increase the number of customers who choose DNB as their home bank and actively use various services of the group, the number of individual and corporate customers in the bank rose by 60.4 thousand in 2011. This was one of the important factors of the bank’s income growth from its core business. As of the end of December, the bank was providing comprehensive range of financial services to 716 thousand individual and corporate customers.
With an increasing number of customers and growing funds on their bank accounts, the deposit portfolio of AB DNB Bankas rose 18.7 percent year-on-year to LTL 5.15 billion.
In 2011, AB DNB Bankas signed new loan agreements worth LTL 1.6 billion and at the end of December its net loan portfolio stood at LTL 8.9 billion. At the year end the faster growth of the newly granted loans was slowed down as some of the corporate customers took more cautious approach weighing the possible impact of the debt crisis in Europe on their main export markets and further business perspective. As a result, the bank's net loan portfolio went down by 4.4 percent year-on-year in 2011.
With country’s economy strengthening and customer risk decreasing, the bank set aside LTL 75.2 million in 2011 for the impaired loans. The amount was three times lower compared to 2010 when the specific provisions amounted to LTL 263.1 million.
Due to proper risk management the bank met all prudential requirements of the Bank of Lithuania.
Please check the Norway’s DNB bank operating results for 2011 on www.dnb.no .
AB DNB Bankas' operating results for the first quarter of 2012 will be released on 28t April.
ADDITIONAL INFORMATION
AB DNB Bankas, formerly DnB NORD, provides banking services to over 685 thousand individual and corporate customers in Lithuania.
The bank’s sole shareholder is DNB Bank ASA, Norway’s largest financial services group. It is one of the few European banks reporting a net profit during all quarters of the financial crisis. DNB Bank is the second largest bank in Nordic region and the 20th in Europe in terms of market capitalisation.
The government of Norway holds 34 percent DNB Bank ASA shares. The shares of the bank are traded on Oslo stock exchange. DNB ASA operates in 19 countries worldwide and it is the world's leading lender to shipping industry and plays a significant role in the energy sector. In Norway DNB group is the leader in loan, deposit, asset management, life insurance, pension funds, payment and other banking areas related with money, capital and real estate markets.
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