The Norwegian Government aims to maintain its ownership in Christiania Bank and Den norske Bank (DnB). The Government proposes an exception from the general 10 per cent ownership limitation for holdings up to 25 per cent in combination with strategic co-operation and alliances.

This proposal is referred to in the report to the Storting on the development of the financial markets and credit institutions in 1998, " Kredittmeldinga 1998". This report, together with a proposition on amendment to current legislation, is presented today.

In the Government’s opinion the current guidelines for the structural policy in financial markets, drawn up in the corresponding report a year ago ("Kredittmeldinga 1997"), still represent a good basis for future policy. A broad majority of members of the Storting

(Parliament) supported these guidelines last year.

Important elements in the Government’s ownership policy remain:

• Maintain a long-term Norwegian ownership in main Norwegian financial institutions.
• Ensure sufficient Norwegian ownership in the two largest commercial banks by keeping a stake of 1/3 of the shares.
• Equal treatment of the banks regarding national ownership.

The policy concerning licences of approvals from the Ministry of Finance will be based on the current guidelines:

• When considering an application for approval, factors as the effect on competition in the domestic markets and financial soundness will be emphasised. The international development towards larger units and increased cross border competition will influence the competition in the markets.
• When considering applications for take-overs and concentrations involving the largest Norwegian finance institutions, importance will be attached to competition in the markets. Based on the present marked situation a merger between the two largest commercial banks would not be approved.

It is the responsibility of the individual financial institutions to work out the organisational and operational alternatives that are of commercial interest. The Government will stress that the applications for approval of mergers or take-overs should be aimed at creating financially sound and competitive institutions. The Government as an owner will, based on these guidelines, emphasise good commercial solutions.

Ownership up to 25 per cent

The proposed changes in the Act on Financial Activities and Financial Institutions are an exception from the rule that limits ownership to 10 per cent. The proposal will allow for ownership of up to 25 per cent in combination with strategic co-operation and alliances. The possibility for approval of large stakes of ownership will open up for co-operation, both between Norwegian financial institutions and between Norwegian and foreign institutions. Strategic co-operation may be combined with both unilateral and bilateral share-ownership.

Chapter 2.3 in "Kredittmeldinga 1998": "Om eigarskap og struktur for finansmarknaden" (About ownership and structure on the financial markets), is available at the Ministry of Finance's website: www.finans.dep.no under "Dokumentarkiv; Proposisjoner, meldinger og utredninger". The complete report will be available on this site later.