- DNB has a larger-than-normal skew toward corporate lending (for a Nordic bank), and management was more aggressive about credit quality going into this downturn.
- Repricing opportunities are likely minimal until mid-2022 at best, and DNB's very good operating efficiency ironically leaves less room for improvement, leaving the bank more dependent on loan growth.
- Norway's economy is in good shape on a relative basis, and Norway's government has the resources to be more active in supporting/stimulating the economy.
- DNB's valuation doesn't look unreasonable, but with DNB more dependent than most on healthy commercial loan demand, I see modestly higher near-term risks.
For further details see:
DNB More Leveraged Than Other Nordics To Healthy Ongoing Commercial Loan Demand