Bank Norwegian plans quarterly dividends after listing
13/06/2016 10:22
* Aims to pay quarterly dividend of 40 pct of net profit
* Positive development in Q2 after record Q1 lending growth
* Says to focus on organic growth, no acquisitions
* Expects profit in Denmark/Finland in second half of 2016
* To be listed on the Oslo stock exchange around June 17
By Camilla Knudsen
OSLO, June 13 (Reuters) - Fast growing consumer lender Bank
Norwegian sees record demand for its loans and intends to pay
quarterly dividends to shareholders next year, its chief
executive told Reuters ahead of a planned listing this week on
the Oslo stock market.
The online bank's customer base grew 42 percent to about
677,000 people in the year to the end of March and it will
continue to expand thanks to recently launched operations across
the Nordic region, CEO Erik Jensen said.
The bank began operations in Norway in 2007, then launched
in Sweden in 2013 and in Denmark and Finland last December, but
has steered clear of acquisitions.
Europe's third-largest budget carrier, Norwegian Air Shuttle
NWC.OL , is the company's top investor with a 20 percent stake,
and the two cooperate closely on credit cards and a loyalty
incentives programme to help drive growth.
It is the latest lender to seek a listing in Norway,
following Pareto Bank PARB.OL , which offers project financing,
in May and online bank Skandiabanken SKNB.OL last November.
Bank Norwegian is focused on consumer finance only and has
around 13 percent of that market in Norway.
"We are only talking about organic growth, because we prefer
to do the credit assessment ourselves," said Jensen, while
adding he aims to make the Finnish and Danish operations
profitable in the next six months.
With an April private share placement of 300 million
Norwegian crowns and a subsequent offering of up to 40 million
crowns, the company is ready for a listing on or around June 17.
So far this year the shares have risen 65 percent in the OTC
(over the counter) market to 82 crowns, valuing Bank Norwegian
at 14.7 billion crowns ($1.8 billion).
LENDING FEARS DISMISSED
Bank Norwegian aims for a dividend pay-out ratio of at least
40 percent of net profits in the long term, but will begin with
a more modest 20 percent ratio from the second quarter next
year.
"Our cash flow has been steady and rising, and we certainly
expect to reach 40 percent pay-outs within the next three
years," Jensen said.
The bank reported record growth in consumer loans in the
first quarter in Norway, and the CEO added that the second
quarter has also been good so far.
On Wednesday, Norway's Financial Supervisory Authority
warned of strong growth in consumer lending and said banks'
losses stemming from such loans could rise substantially.
Jensen said it was appropriate for the regulator to express
its concerns, but added he was not worried for his own bank's
portfolio.
"Even if losses were to increase by 20-30 basis points, it
would not be critical for us," Jensen said, adding that he was
"very comfortable with the situation".
Pretax profit amounted to 220 million crowns in the first
quarter, up from 150 million at the same stage last year.
($1 = 8.1703 Norwegian crowns)
($1 = 8.2420 Norwegian crowns)
(Editing by Terje Solsvik and Keith Weir)
((camilla.knudsen@thomsonreuters.com; +47 2331 6595; Reuters
Messaging: camilla.knudsen.thomsonreuters.com@reuters.net))
Keywords: BANK NORWEGIAN OUTLOOK/