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IMPROVED PERFORMANCE BUT LOAN LOSSES STILL HIGH SAYS DEN NORSKE BANK

 OSLO, Norway, May 4 /PRNewswire/ -- Den norske Bank recorded an operating loss of Norwegian Krone (NOK) 135 million after loan losses for the first quarter of 1993, which represents an improvement of NOK 471 million relative to the previous quarter and NOK 461 million compared with the first quarter of 1992. Operating profit before loan losses shows pronounced improvement, increasing by a total of NOK 591 million relative to the corresponding period last year.
 "During the quarter we have accumulated NOK 245 million in unrealized profits which have not been included in the operating results. The improvement in performance is thus greater than appears in the accounts," says group managing director Finn A. Hvistendahl. "Nonetheless, it would be premature to declare an end to the banking crisis."
 Net interest income was 2.6 percent of average total assets, up from 2.3 percent in the first quarter of 1992. Declining interest rates have, moreover, led to a rise in the value of the bank's bond portfolio and profits on shareholdings totalling NOK 338 million. "The greatest long- term implication, however, is that we will be able to see a gradual improvement of the customers' financial situation and in the value of loan collateral," says Finn A. Hvistendahl.
 Productivity continues to rise
 Mr. Hvistendahl added that the bank's costs continue to show a positive trend. Operating expenses are 7.2 per cent lower than for the same period last year. "We have achieved a steady reduction of costs each year since 1988," says Mr. Hvistendahl. "During the first three months of the year staff has been reduced by 121 full-time positions. In the course of a five-year period the number of employees has been cut by 37 percent."
 Loan losses and non-performing loans
 Losses on loans to small and medium-sized companies in Norway have declined substantially. Loan-loss provisions related to large commercial loans, on the other hand, show an increase. The level of loan losses remains high for DnB London. These factors had an impact on net losses on loans and guarantees, which amounted to NOK 1,173 million in the first quarter. Losses were NOK 1,020 million in the corresponding period a year earlier.
 "The bank's portfolio of non-performing loans amounted to NOK 12,074 million at the end of the first quarter, compared with NOK 11,590 million as at 31 December 1992. The figures show that it is still too early to claim that the danger is over. Uncertainty looms too large for any such conclusion," Mr. Hvistendahl points out.
 Capital adequacy
 At the end of the first quarter Den norske Bank's total assets were NOK 177.4 billion. Based on risk-weighted assets of NOK 159.5 billion, the bank had a capital ratio of 9.3 percent. This represents a strengthening of capital adequacy by 0.5 percentage points since the beginning of the year.
 -0- 5/4/93
 /CONTACT: Glenda Tefre, corporate communications dept. of Den norske Bank, 47-22-48-15-98 (in Oslo)/


CO: Den norske Bank ST: IN: FIN SU:

SH -- NY020 -- 4165 05/04/93 09:00 EDT
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Publication:PR Newswire
Date:May 4, 1993
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