February 6, 2014
Press release: Danske Bank reports net profit of DKK 7.1 billion (EUR 953.7 million) for 2013
Danske Bank today announced its financial results for 2013. The announcement and the annual report can be viewed at www.danskebank.com/reports
"The year 2013 was a time of progress for Danske Bank," says Thomas F. Borgen, CEO. "We took steps to strengthen our position in the market, accelerated the execution of our strategy and contained costs. Our financial results improved, but they were still unsatisfactory."
2013 vs 2012
"We still have a way to go to realise the full potential of Danske Bank, but we are confident that we are moving in the right direction. Understanding and meeting our customers’ increasingly differentiated and complex demands are key to our success. We have a strong combination of skills, expertise and innovative solutions, and we will continue to strengthen our relationship with our customers."
Highlights are shown below:
In 2013, Danske Bank Group posted a profit before tax from core activities of DKK 11.5 billion (EUR 1,538.0 million). The net profit was DKK 7.1 billion (EUR 953.7 million), up 51% from DKK 4.7 billion (EUR 633.3 million) in 2012. The results were in line with the revised guidance.
The Board of Directors is proposing a dividend of DKK 2 (EUR 0.3) per share, or 28% of net profit for the year.
The return on equity after tax for 2013 was 5.0%, which represents an increase of 1.4 percentage points over the level in 2012.
Total income amounted to DKK 40.0 billion (EUR 5,362.3 million), declining 12% from the 2012 level primarily because of lower net trading income in comparison with the extraordinarily high level of income in 2012 and lower income from our insurance business at Danica Pension.
Total expenses amounted to DKK 24.3 billion (EUR 3,263 million), a 1% reduction from the level in 2012, as we continue to execute our cost initiatives.
Impairments in core activities fell to DKK 4.2 billion (EUR 561.2 million), or 45%, from DKK 7.7 billion (EUR 1,026.8 million) in 2012, as a result of the improved macroeconomic situation in our core markets. Impairments fell at all business units. Impairments at the Non-core unit fell from DKK 4.8 billion (EUR 650.0 million) to DKK 1.2 billion (EUR 165.3 million).
The core tier 1 capital and total capital ratios were 14.7% and 21.4% at the end of 2013. We met our capital ratio targets as early as in 2012.
With a liquidity coverage ratio (LCR) of 127% at the end of December 2013, Danske Bank complied comfortably with the LCR requirement.
In 2013, we issued tier 2 capital of DKK 13.9 billion (EUR 1,867.5 million) in preparation for the planned repayment in 2014 of DKK 24 billion (EUR 3,224.1 million) in hybrid capital from the Danish state. We also redeemed DKK 13.8 billion (EUR 1,854.8 million) in tier 2 notes.
In 2013, Fitch Ratings and Standard & Poor’s changed the outlook for Danske Bank’s long-term rating to stable. In December 2013, Moody’s changed the outlook for the long-term rating from stable to positive. We aim to improve our ratings by at least one notch in the short term.
For 2014, we expect a net profit in the range of DKK 9-12 billion (EUR 1,206.4-1,608.5 million), and we remain committed to our intermediate target of a return on equity of 9% in 2015. We remain fully committed to attaining a return on equity after tax of above 12 % in the longer term.
Contacts available on 6 February 2014 from 10.30am CET:
Thomas F. Borgen, CEO, tel. +45 45 14 60 01
Henrik Ramlau-Hansen, CFO, tel. +45 45 14 06 66Press conference
The Annual Report 2013 will be presented at a press conference at 10.30am CET.
You can follow a live webcast of the press conferene
(in Danish with English subtitles and presentation). Conference call
Danske Bank will hold a conference call at 2.30pm CET.
You can follow a live webcast of the conference call
View Danske Bank’s online reports at: www.danskebank.com/onlinereport