Date of Release: 2008-04-30

Nordea Group

Ratings (AA) Unaffected by Preliminary Result

DBRS commented today that the ratings of the banks of the Nordea Group (Nordea or the Group) are unaffected following the release the company’s interim report covering the period of January through March 2008. DBRS maintains AA and R-1 (high) long-term and short-term ratings, respectively, on Nordea Bank AB, and its main operating banks (Nordea Bank Danmark A/S, Nordea Bank Finland Plc and Nordea Bank Norge ASA). The trend on all ratings is Stable.

Nordea delivered a solid result for the first quarter, with quarterly net profit of EUR 687 million, down slightly from the same period in 2007, while total operating income increased by 5% to EUR 1.961 billion. DBRS views the solid result achieved in the current market environment as further evidence of Nordea’s sound risk management and balance sheet strength. Moreover, the first-quarter result demonstrates the solid franchise, the Group’s overall earnings strength despite the difficult operating environment and the solid execution on its growth strategy.

Asset quality has remained strong. Net loan losses were EUR 21 million, reflecting continued sound asset quality and a reduction in recoveries. Gross impaired loans and receivables increased marginally to EUR 1.44 billion. DBRS views Nordea’s diversified loan portfolio and its sound risk management discipline as key positive factors underpinning the ratings. However, given the current global macro-economic environment, DBRS expects a level of asset quality degradation in the near term, largely driven by lower recoveries of provisions and more normalized losses. The Company has limited direct and indirect exposure to U.S. sub-prime mortgages and credit-linked structured investment vehicles.

Liquidity remained solid. The funding profile is anchored by a solid deposit book. Deposits and borrowings from the public ended the quarter at EUR 141 billion, down slightly from EUR 142.3 billion at 31 December 2007, yet up 12% from March of 2007. Importantly, during the recent quarter, Nordea issued a EUR 1.5 billion Euro Covered Bond, which illustrated investor confidence in Nordea. DBRS views Nordea’s market funding base as well diversified by geography, debt instruments and investor base. Loans and receivables to the public increased to EUR 253.9 billion, up from EUR 244.7 billion at 31 December 2007, evidencing continued growth, whilst lending yields remained strong. Capitalisation remained solid. Nordea’s total risk weighted assets (RWA) as of 31 March 2008 amounted to EUR 201 billion, affected by the existing transition rules. Excluding transition rules, RWA would have amounted to EUR 176 billion. Credit exposure totalled EUR 429 billion, including off-balance sheet exposure. At 31 March 2008, Nordea’s Tier 1 capital ratio increased to 7.2% and its total capital ratio rose slightly to 9.4%, both within the target levels set by the Group.

DBRS maintains AA and R-1 (high) long-term and short-term ratings, respectively, on Nordea Bank AB and its main affiliates: Nordea Bank Finland Plc, Nordea Bank Norge ASA and Nordea Bank Danmark A/S. The Trend on all ratings is stable. The ratings are underpinned by the solid credit fundamentals of the entire Nordea Group.

The ratings reflect Nordea’s good, geographically diversified franchise in the Nordic region, prudent exposure into high-growth countries and good quality of its earnings. DBRS ratings also take into account the Bank’s uncertainty regarding the ownership structure following any sale of the Swedish government stake and exposure to the less-mature Baltic regions, as well as Poland and Russia.

With its well-established and diversified franchise across the Nordic Region, Nordea has a strong presence in Sweden, Finland, Denmark and Norway. It provides universal banking services in these markets, with a main focus on retail banking that is complemented by corporate, investment banking, asset management and insurance businesses. At 31 March 2008, the Company reported total assets of EUR 411 billion

Note:
All figures are in EUR unless otherwise noted.

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