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July 13, 2020, 2:18 a.m. EDT

DNB profit falls, warns on 2020 targets

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By Ian Walker

DNB ASA reported on Monday a 19% fall in second-quarter net profit after booking a number of one-off charges, and said that while its financial ambitions are unchanged it doesn't expect to meet them this year due to the coronavirus pandemic.

Norway's largest lender made a profit attributable to shareholders of 4.77 billion Norwegian kroner ($505.9 million) compared with NOK5.89 billion a year earlier, while net interest income slipped to NOK9.45 billion from NOK9.58 billion.

Adjusted pretax profit--one of the company's preferred metrics, which strips out exceptional and other one-off items--was NOK8.41 billion compared with NOK8.16 billion for the second quarter of 2019.

The bank had previously said it would book NOK19 million hit from basis swaps connected to funding in the second quarter of 2020 and recognize a negative effect of NOK1.34 billion from additional Tier 1 Capital.

DNB's common equity Tier 1 capital ratio--a measure of a bank's financial strength--rose to 18.2% from 17.3%.

DNB said its dividend policy remains unchanged but that due to the pandemic it will decide on the distribution of dividends and share buybacks at an extraordinary general meeting in December, at the latest.

Write to Ian Walker at ian.walker@wsj.com

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