1203 GMT - DNB Bank raised its return on equity target, driven by higher fee-income growth expectations, but shares remain expensive into a falling rate environment, UBS analyst Johan Ekblom writes. The Norwegian lender now targets a return on equity of above 14%, from above 13% previously. It is also aiming for a cost/income ratio below 40%, a CET1 ratio above regulatory requirements and a dividend payout ratio above 50%. Profitability improvements are expected from a shift to a more capital-light business model, supported by the consolidation of Swedish bank Carnegie and fee-income growth above 9%. Other drivers include volume growth, cost savings and active capital management, Ekblom says. UBS lifts its price target to 211 kroner from 207 kroner and keeps its rating at sell. Shares trade 0.7% higher at 230.20 kroner. (dominic.chopping@wsj.com)
(END) Dow Jones Newswires
November 20, 2024 07:03 ET (12:03 GMT)
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