Printer Friendly

DEN NORSKE BANK ANNOUNCES NET LOSS FOLLOWING HEAVY LOAN LOSSES

       DEN NORSKE BANK ANNOUNCES NET LOSS FOLLOWING HEAVY LOAN LOSSES
    OSLO, Norway, Feb. 18 /PRNewswire/ -- Den norske Bank Group recorded an ordinary net loss of Norwegian krone (NOK) 4,328 million in 1991, after deducting NOK 5,580 million in loan-loss provisions from operating profits of NOK 1,270 million.  At the end of the year the bank's capital ratio was 7.7 percent.
    "The adverse trend in the Norwegian economy in the last part of 1991 made it necessary to increase loan-loss provisions substantially," says group managing director Finn A. Hvistendahl.  "This is the main reason why the bank's 1991 results showed a far weaker development than anticipated."
    "We cannot expect the volume of non-performing loans in the portfolio to show a rapid decline until the Norwegian economy shows improvement," says Hvistendahl.  The net volume of non-performing loans was NOK 8,582 million at the end of 1991.  These are loans on which the bank records no interest income.  The accumulated provisions for estimated losses totalled about NOK 8,900 million at year-end.
    The agreements with the Government Bank Insurance Fund, the Government Bank Investment Fund and former shareholders in Realkreditt ensured the bank a capital ratio of 7.7 percent at the end of the year.
    "It is encouraging that despite difficulties, we have managed to maintain private ownership of the bank," says the group managing director.  He believes it is of prime importance to maintain a diversified ownership structure in the bank.  "Depending on the outcome of the planned share capital increase later this year, the privately- owned share capital in the bank will be minimum 43 percent," says Hvistendahl.
    Hvistendahl emphasizes that there are bright spots in the bank's situation.  "The accounts show that income on 'healthy' loans is acceptable," he says.  In 1991 the bank's net interest income was NOK 4,662 million as against NOK 4,957 million in 1990.
    The bank's income on trading in foreign exchange and treasury products as well as income generated in some of the bank's domestic subsidiaries is considered satisfactory.
    "The bank has recently restructured its divisions.  The establishment of separate divisions for private customers and medium- sized corporate clients will contribute to improved profitability in various market segments within existing opportunities, given the strong competition and customer demands," said Hvistendahl.
    In the course of 1991 costs at group level were reduced by a further NOK 633 million relative to a year earlier.  Since 1988 costs have been pared by a total of NOK 1,097 million, with staff reductions of 2,466 full-time positions.  "The bank is considerably more cost-efficient than previously," says Finn A. Hvistendahl.
    As of Dec. 31, 1991, Den norske Bank acquired 91.5 percent of the shares of Realkreditt.  In the preliminary, unaudited accounts Realkreditt is included in the bank's balance sheet but not in the profit and loss account.
    Den norske Bank Group's total assets as at Dec. 31, 1991 were NOK 195.4 billion. The need for foreign currency funding in the interbank market has been reduced by NOK 15 billion.  Risk-weighted volume was NOK 176.9 billion at year-end.
    -0-                2/18/92
    /CONTACT:  Corporate communications department of Den norske Bank, 47-2-48-16-91 or 47-2-48-10-50. CO:  Den norske Bank Group ST: IN:  FIN SU:  ERN SM -- NY052 -- 9892 02/18/92 11:35 EST
COPYRIGHT 1992 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Feb 18, 1992
Words:553
Previous Article:FIRST UNION CORPORATION INCREASES COMMON STOCK DIVIDEND
Next Article:CHRISTINE HANSON APPOINTED VICE PRESIDENT OF MCA INC.
Topics:


Related Articles
IMPROVED RESULTS, BUT DEN NORSKE LOAN LOSSES REMAIN HIGH
TURMOIL IN MONEY AND SECURITIES MARKETS IMPAIRS DEN NORSKE BANK THIRD QUARTER RESULTS
DEN NORSKE BANK ANNOUNCES PRELIMINARY ACCOUNTING FIGURES FOR 1992
IMPROVED PERFORMANCE BUT LOAN LOSSES STILL HIGH SAYS DEN NORSKE BANK
FIRST-HALF PROFITS OF NORWEGIAN KRONE 218 MILLION FOR DEN NORSKE BANK
PROFITS OF 720 MILLION KRONER FOR DEN NORSKE BANK SO FAR THIS YEAR
PROFITS OF NOK 982M FOR DEN NORSKE BANK IN 1993
RECORD PROFITS FOR DEN NORSKE BANK
DEN NORSKE BANK REPORTS NET PROFITS OF NOK 1.7 BILLION
OVER NOK 2 BILLION IN NET PROFITS FOR DEN NORSKE BANK AT END OF THIRD QUARTER

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters