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Retail Banking Market Insights: Norway

  • EXECUTIVE SUMMARY
    • Banks in Norway are well positioned to tap into new growth opportunities
  • CURRENT ACCOUNTS
    • MARKET SHARE
      • Norway's current account market is highly concentrated, with the top three providers serving 59% of the market
    • CHOICE OF PROVIDER
      • Choice of provider is driven by accessibility and local brands
    • RECOMMENDATION
      • Sparebanken Vest has the greatest advocacy rate among the main providers
    • SWITCHING
      • Switching rates in Norway are high, with push factors acting as the main trigger to move
    • CHANNEL OPENING
      • The branch is still the most popular channel for customer acquisition
    • CHANNEL ACTIVITY
      • More complex transactions are conducted via branches and call centers, hence simple transactions can be directed to digital channels
      • Digital channels are popular for routine activities conducted on a frequent basis
    • CHANNEL SATISFACTION
      • Consumers are more satisfied with online banking than with any other channel
  • SAVINGS ACCOUNTS
    • MARKET SIZING & FORECASTING
      • Retail deposits in Norway are expected to grow sharply over the forecast period
    • MARKET SHARE AND CHOICE OF PROVIDER
      • The savings account market has similar market shares to that of the current account market
    • REASONS FOR SAVING
      • Around two thirds of consumers are saving for unforeseen events
    • CHANNEL OPENING
      • Non-branch channels play a major role in savings acquisition in the Nordics
    • RECOMMENDATION
      • Recommendations by experts and other customers have a significant impact upon advocacy rates, above product features
  • MORTGAGES
    • MARKET SIZING & FORECASTING
      • Mortgage lending will grow rapidly over the next five years
    • MARKET SHARE
      • Mortgage lenders in Norway offer a similar portfolio of mortgage products
    • PRODUCT FEATURES AND CHOICE OF PROVIDER
      • Borrowers choose lenders that they have a working relationship with
    • CHANNEL OPENING
      • Digital channels are an increasingly popular touchpoint in Norway when arranging a mortgage
    • RECOMMENDATION
      • Personal recommendations play a strong role in increasing advocacy
  • PERSONAL LOANS
    • MARKET SIZING & FORECASTING
      • Consumer credit advances will decline over the forecast period
    • MARKET SHARE
      • The main branch-based banks dominate the personal loans market
    • PRODUCT FEATURES AND CHOICE OF PROVIDER
      • Following a strong economic recovery, excitement about the future features highly among Norwegian consumers
    • CHANNEL OPENING AND REASONS FOR BORROWING
      • Online has surpassed direct channels for loan arrangement in Norway
    • RECOMMENDATION
      • Norwegian borrowers are reluctant to recommend their loan providers
  • BANK INFRASTRUCTURE & REGULATION
    • INFRASTRUCTURE
      • It is essential to continue to invest in the Norwegian banking infrastructure
    • REGULATORY ENVIRONMENT
      • The Norwegian authorities have strengthened regulation and supervision
    • RECENT REGULATORY DEVELOPMENTS
      • The Norwegian authorities have recently brought in new regulations on mortgage lending and taken important steps to promote competition
  • APPENDIX
    • Abbreviations, acronyms, and definitions
    • Methodology and further reading

Retail Banking Market Insights: Norway

Summary

Norway has a developed, well diversified, and stable financial system. The market for financial services is concentrated, with a handful of large banks controlling a significant market share. Product ownership rates are high for mortgages and current and savings accounts. Consumers are generally conservative in their choice of provider, with a bias towards providers they have an existing relationship with. The market should open up to new entrants in order to encourage greater competition within the sector.

Key Findings

  • The banking sector in Norway is concentrated, with the top three providers accounting for 59% of main current accounts.
  • Norwegian consumers tend to choose providers on the basis of reputational factors and an existing relationship.
  • 11% consumers in Norway have switched their accounts in the last 12 months, which is the highest in the region. However, it is still below the global average.
  • Norwegian savers are cautious, with around two-thirds saving to protect themselves against unforeseen events and over a third saving for financial investment. A desire for value for money is among the top three consumer characteristics.
  • The mortgage market in Norway will grow rapidly over the next five years (2015-19). The high rate of mortgage ownership (57%) suggests that Norwegian households have relatively broad access to mortgage credit.
  • Norway’s mortgage balances outstanding totaled NOK 1.74tn in 2014, up from NOK1.21tn in 2009.
  • Around a third of consumers in Norway have a personal loan and consumer lending is dependent on overall economic development. The personal loans market is dominated by DNB, Sparebank 1 Gruppen, and Santander, with almost 42% of loans held with these two providers.
  • More than two thirds of the population use smartphones in Norway, implying a large potential market for mobile-delivered financial services. Continued investment in Norway’s banking infrastructure is the key to progress.
Synopsis
  • Verdict Financial’s Retail Banking Country Snapshot: Norway is a review of the retail banking sector in Norway, with a particular focus on the current account, savings, mortgage, and personal loan markets. It includes both market-level data and insight from our global consumer survey.
  • Overview of Norway’s banking sector.
  • Insight into consumer preferences in Norway and the reasons for taking out and using their financial products and how this has evolved in recent years.
  • Discover which providers dominate the current account, savings, mortgage, and loan markets and the different factors persuading customers to choose them.
  • Examination of the extent to which consumers are using online and mobile channels to research, take out, and use their financial products.
Reasons To Buy
  • Futureproof your strategy with market sizing, forecasts, and analysis of key developments currently affecting Norway’s retail banking sector.
  • Target consumers with inside knowledge of their true behaviors and attitudes, with detailed analysis from our proprietary insight.
  • Learn about the impact new entrants and distribution channels will have on the market.


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