Denmark’s largest banking group,
Danske, has posted a net profit for the first three months of
DKR1.6 billion ($295 million), compared to DKR2.6 billion in the
first quarter of 2008. The net profit was affected by large loan
impairment charges that were to a large degree offset by sharply
higher net trading income.
Total income of DKR17.2 billion for the period
was the group’s highest quarterly income to date, with the increase
due mainly to “exceptionally” high earnings at Danske Markets. Loan
impairment charges amounted to DKR8 billion against DKR500 million
in the first quarter of 2008 and DKR9.2 billion in the fourth
quarter of 2008. Individual impairment charges, primarily against
loans to small and medium-sized businesses, amounted to DKR6.4
billion.
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“We have posted the highest quarterly income
ever but also recorded an extraordinarily high level of loan
impairment charges, reflecting the difficult market conditions,”
said chairman Peter Straarup.
The Danish state has approved the group’s
application for subordinated loan capital of DKR26 billion. The
loan will raise the group’s core capital ratio to 12
percent.
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