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DNB - DNB ASA News Story

NOK182.7 3.3  1.9%

Last Trade - 14/05/21

Sector
Financials
Size
Large Cap
Market Cap £24.25bn
Enterprise Value £55.92bn
Revenue £4.98bn
Position in Universe 29th / 1828

BREAKINGVIEWS-Capital Calls: Norwegian digital bank hits M&A glass ceiling

Thu 15th April, 2021 10:07am
(The author is a Reuters Breakingviews columnist.  The opinions
expressed are their own.)
    LONDON, April 15 (Reuters Breakingviews) - Concise insights
on global finance in the Covid-19 era.
 
    ------------------------------------------------
DISRUPTION, INTERRUPTED. Sbanken  SBANK.OL , a 20-year-old
digital upstart, wanted to be Norwegians’ favourite bank. It’ll
now have to pursue that mission from within the financial
establishment after agreeing to a $1.3 billion takeover https://www.ir.dnb.no/press-and-reports/press-releases?page=/press/perma/1906257
 by $34 billion domestic behemoth DNB  DNB.OL . A chunky 30%
premium to its undisturbed price looks alluring. At 1.5 times
forward tangible book value, using Refinitiv data, it’s a
one-third premium to the multiples of big Nordic peers. For its
part, DNB can put excess capital to work, increase its mortgage
market share to 27% from 24% and nab some digital expertise in
the process. 
    Sbanken’s decision to sell is notable given all the hoopla
about digital lenders disrupting incumbents. It turns out that’s
harder than it sounds. Its loan growth slowed to 2.4% in 2020
and 2.9% in 2019, compared with 13.7% in 2017. Retail customer
growth was a humdrum 3% last year. Sbanken is about a decade
older than sexier European upstarts Monzo, Revolut, N26 and
Starling Bank. The risk for them is that Sbanken is a sign of
future mediocrity. (By Liam Proud)

    On Twitter http://twitter.com/breakingviews
    
    Earlier in Capital Calls:
    
    South Korean telco dials up good spin  urn:newsml:reuters.com:*:nL4N2M8219
    ECB faces a long, hard slog  urn:newsml:reuters.com:*:nL1N2M72EM
    Madoff’s ghost  urn:newsml:reuters.com:*:nL1N2M729F
    Stitch Fix’s fix  urn:newsml:reuters.com:*:nL4N2M73SW
    Norwegian Air’s founder has another go  urn:newsml:reuters.com:*:nL4N2M73RR
 

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| Editing by Ed Cropley and Oliver Taslic)
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