SpareBank 1 SR-Bank ASA (SRBANK); Extraordinary dividend from SpareBank 1 Gruppen AS paid
Reference is made to the establishment of Fremtind Forsikring AS on 01/01/2018 as the result of the merger of SpareBank 1 Skadeforsikring AS and DNB Forsikring AS. The notice to the stock exchange issued on 21/12/2018 stated what the financial impact of the merger would be for SpareBank 1 Gruppen AS and its owners in SpareBank 1 Gruppen.
The transaction agreement assumed a conversion ratio of 80% for SpareBank 1 Gruppen AS and 20% for DNB ASA. This conversion ratio was based on a negotiated market value for the two non-life insurance companies, inclusive of the value of the personal risk products in the planned demerger. Furthermore, it was agreed that during 2019 DNB ASA would acquire a 35 per cent interest in the company. DNB ASA also has an option to buy a stake of up to 40 per cent.
DNB’s acquisition increasing its stake from 20% to 35% in Fremtind Forsikring AS has now been completed. Overall, this will result in increased equity for SpareBank 1 Gruppen of around NOK 4.7 billion at a group level. The majority interest’s (the SpareBank 1 banks and the Norwegian Federation of Trade Unions) share of this increase will be around NOK 2.4 billion. SpareBank 1 SR-Bank ASA’s share of this increase (19,5 per cent) constitutes approx. NOK 460 million and will be recorded in the income statement for the group in the first quarter of 2019.
SpareBank 1 Gruppen AS (the parent company) has also received a tax free gain of approx. NOK 1.7 billion (a share of the remaining NOK 2.4 billion) as a result of the selldown. This gain has been paid out as an extraordinary dividend to shareholders in SpareBank 1 Gruppen AS on 29 March 2019. In the case of SpareBank 1 SR-Bank ASA, the dividend amounts to NOK 332 million.
Overall, the effect of the transaction and dividend payment will increase SpareBank 1 SR-Bank ASA’s common equity tier 1 capital ratio by an estimated 0,2 percentage points, taking into account the fact that the calculation of the capital ratio includes 50% of the result from the interim figures.
The tax free gain does not include personal risk products. These products are expected to be transferred to Fremtind in 2019 following final approval from the Financial Supervisory Authority of Norway. Further information on the financial effects of these transfers will be communicated after final approval has been received.
Stavanger, 29 March 2019
Inge Reinertsen, CFO, Tel. +47 909 95 033
Stian Helgøy, Vice President Investor Relations, Tel. +47 906 52 173
Thor-Christian Haugland, Executive Vice President Communications, Tel. +47 480 31 633
This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.