DnB NOR Bank ASA
Fully underwritten rights issue of NOK 14 billion to strengthen Tier 1 capital in DnB NOR

DnB NOR Bank ASA / 

25.09.2009 

Dissemination of a Adhoc News, transmitted by
DGAP - a company of EquityStory AG.
The issuer is solely responsible for the content of this announcement.

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The Board of DnB NOR proposes to strengthen its equity capital base by NOK 14
billion through an issue of ordinary shares with pre-emptive subscription
rights for existing shareholders (the 'Rights Issue'). The Rights Issue is
supported by DnB NOR's largest shareholders and underwritten by a syndicate of
banks. After completion of the Rights Issue, the Tier 1 ratio will increase to
11.3 %*. 
DnB NOR chose not to raise capital during the most turbulent period in the
financial markets earlier this year. Estimates for loan-loss provisions and
operating profits for 2009 and 2010 remain unchanged. DnB NOR believes that,
based on the current improved market conditions, raising equity capital through
an ordinary Rights Issue is in the best interests of shareholders and
customers. DnB NOR will therefore not apply for capital from the State Finance
Fund. 
Rune Bjerke, CEO, commenting on the transaction, said: 'This transaction will
enhance our ability to meet our customers' future financing needs while making
us better prepared to satisfy anticipated higher capital adequacy requirements
in the banking sector. In addition, it will enable a swifter return to our
long-term dividend policy.' 
'The State Finance Fund has played a crucial role during this unstable period.
Today, the equity market is preferable to DnB NOR as it ensures access to
permanent capital, equal treatment of all our more than 45 000 shareholders and
offers common equity on competitive terms.' 
To better capture future opportunities, DnB NOR's management and Board consider
it to be in the best interests of the company's shareholders to strengthen the
equity capital base in order to: 
·    Proactively meet customers' future financing needs: We will be better able
to meet customers' long-term financing needs, even in light of future stricter
capital adequacy requirements. A stronger capital position will ensure greater
lending capacity and will strengthen DnB NOR's competitive position. 
·    Pursue profitable business opportunities: The Rights Issue will enhance
DnB NOR's ability to pursue profitable business opportunities as part of DnB
NOR's future growth strategy. 
 ·    Be well positioned for future stricter capital adequacy requirements in
the banking sector: DnB NOR anticipates increasing capital requirements from
regulators and rating agencies. The proposed Rights Issue will help strengthen
DnB NOR's long-term capital position in advance of the anticipated changes. 
 ·    Swifter return to long-term dividend policy: The capital increase will
allow DnB NOR to resume dividend payments sooner in accordance with its
long-term dividend policy. 
Transaction highlights 
·          DnB NOR's largest shareholder, the Norwegian government, represented
by the Ministry of Trade and Industry, owns 34.0 % of the outstanding shares
and is supportive of DnB NOR's action to strengthen its capital base. The
government will put forward a parliamentary proposition to participate for its
pro rata share of the Rights Issue. 
 
·          The Savings Bank Foundation (Sparebankstiftelsen DnB NOR) is
supportive of the Rights Issue and has entered into an agreement to underwrite
and subscribe for NOK 500 million, and aims to maintain an ownership percentage
in DnB NOR of above 10% after the transaction. 
 ·          The National Insurance Fund (Folketrygdfondet) (3.8 % ownership) is
supportive of the Rights Issue and has entered into an agreement to underwrite
and subscribe for its pro rata share of the Rights Issue. 
 ·          The remaining part of the Rights Issue is underwritten by Morgan
Stanley and Citi, subject to customary terms and conditions and to the
Norwegian government subscribing to its pro rata share. 
 ·          The Rights Issue is subject to approval by an extraordinary general
meeting that is currently planned for the second half of November 2009. The
subscription period will commence shortly thereafter. The issue price will be
set immediately before the EGM. 
 ·          Morgan Stanley, DnB NOR Markets and Citi are acting as Joint Global
Coordinators and Joint Bookrunners for the Rights Issue. Arctic Securities is
also acting as an advisor to DnB NOR in the process. 
DnB NOR currently has a strong financial position and meets all regulatory
capital requirements with substantial margins. After the Rights Issue, DnB
NOR's pro forma Equity Tier 1 ratio after full IRB implementation will be 10.2
% and the Tier 1 ratio 11.3 %. Issuing ordinary shares conforms with the key
measures put forward by the Basel Committee on Banking Supervision earlier this
month that 'the predominant form of Tier 1 capital must be common shares and
retained earnings'. 
 It is important for DnB NOR to secure fair treatment of its shareholders and
maintain a broad shareholder base. The proposed capital measures provide a fair
and transparent market solution for all shareholders and special measures will
be taken to ensure full information to the company's retail shareholders and to
make it easy for them to participate in the Rights Issue or sell their rights. 
Indicative timeline
DnB NOR's largest shareholder, the Ministry of Trade and Industry, will seek
parliamentary approval to enable it to participate in the Rights Issue. This is
expected to be obtained during the second half of November 2009. DnB NOR will
call for an extraordinary general meeting expected to be held shortly after
such parliamentary approval in the second half of November 2009 and the
subscription period will commence shortly thereafter. It is currently expected
that the Rights Issue will be completed by mid-December 2009. 
Press and analyst conference 
A press conference (in Norwegian) will be held today at 09.00 CET at DnB NOR's
headquarters in Oslo. The press conference will also be published as a live
webcast. To attend the live webcast, please log on to www.dnbnor.com. A
recording of the press conference will be available at www.dnbnor.com. 
International telephone conference for analysts and the press
At 11.00 CET an international telephone conference (in English) will be held
for analysts and the press. To participate, please dial +47 800 80 119 or  +47
23 00 04 00 no later than 10.50 CET. 
The teleconference is not intended for journalists located in the US. 
Information available online
The announcement presentation and the press release will be made available on
the rights issue web site, accessible for eligible investors through the DnB
NOR web site. During the rights issue period, this website will be updated with
information and documentation relevant to the rights issue. Please visit
www.dnbnor.com. 

 * Pro forma Tier 1 ratio after full implementation of IRB including 50% of
profits for the period. 


For further information, please contact: 
Bjørn Erik Næss, CFO, tel. +47 415 05 201, e-mail bjorn.erik.naess@dnbnor.no
Per Sagbakken, EVP, Investor Relations, tel. +47 906 61 159, e-mail
per.sagbakken@dnbnor.no Bentestuen, EVP, Corporate Communications, tel. +47 950
28 448, 
e-mail trond.bentestuen@dnbnor.noTrond

News Source: NASDAQ OMX



25.09.2009  Financial News transmitted by DGAP

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Language:     English
Company:      DnB NOR Bank ASA
              
               
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ISIN:         LV0000800399
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