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The full data:
Interim report
– first half 2023
Danske Bank Group
Management's report
Financial statements
Financial highlights - D anske Bank Group
Executive summary
Strategy exec ution
Sustainability
Financial review
Personal Custo mers
Business Cust omers
Large Corporates & Institutions
Danica Pe nsion
Northern Ireland
Non-core
Group Functions
Definition of alternative performance
measures
3
4
6
9
10
18
21
23
26
28
30
31
33
Income state ment
Stateme nt of comprehensive inco me
Balance sheet
Stateme nt of capital
Cash flow state ment
Notes
Statements
Stateme nt by the manage ment
Independe nt a uditor's re view re port
Supple mentary infor matio n
35
36
37
38
40
41
86
87
88
Financial highlights – Danske Bank Group
Income statement
(DKK millions)
First half
2023
First half
Index
2022* 23/22
Net interest income
Net fee income
Net trading income
Net income from insurance business
Other income
Total income
Operating expenses
of which resolution fund, bank tax etc.
Provision for Estonia matter
Impairment charges on goodwill
Profit before loan impairment charges
Loan impairment charges
Profit before tax, core
Profit before tax, Non-core
Profit before tax
Tax
Net profit
16,540
5,693
2,772
689
-106
25,587
12,618
496
-
-
12,969
-28
12,997
-25
12,972
2,794
11,370
6,537
320
-103
959
19,083
12,793
491
-
-
6,290
426
5,864
17
5,881
1,343
145
87
-
-
-
134
99
101
-
-
206
-
222
-
221
208
Q2
2023
8,516
2,739
1,160
192
-431
12,176
6,338
243
-
-
5,838
-175
6,013
5
6,018
1,007
8,023
2,954
1,612
497
325
13,411
6,280
254
-
-
7,131
147
6,984
-30
6,954
1,787
10,178
4,538
224
5,011
5,167
Attributable to additional tier 1 etc.
-
86
-
-
-
Balance sheet (end of period)
(DKK millions)
Due from credit institutions and central banks
Repo loans
Loans
Trading portfolio assets
Investment securities
Assets under insurance contracts
Other assets (including Non-core)
251,568
259,077
245,598
280,561
1,752,598 1,819,297
661,284
286,898
702,767
115,897
559,305
287,966
502,546
118,546
251,568
259,077
295,708
102
92
253,823
96 1,752,598 1,769,827
569,575
85
291,620
100
497,029
72
113,824
102
559,305
287,966
502,546
118,546
Danske Bank / Interim report – first half 2023 3/88
Q1
Index
2023 Q2/Q1
Q2
Index
2022* 23/22
Full year
2022*
106
93
72
39
-
91
101
96
-
-
82
-
86
-
87
56
97
-
5,779
3,157
-363
32
291
8,896
6,421
250
-
-
2,475
192
2,282
31
2,313
516
147
87
-
-
-
137
99
97
-
-
236
-
263
16
260
195
25,108
12,590
1,875
280
1,936
41,789
26,478
962
13,800
1,627
-116
1,568
-1,684
-13
-1,697
2,883
1,796
279
-4,580
5
-
86
85
102
245,598
280,561
99 1,819,297
661,284
98
286,898
99
702,767
101
115,897
104
191,828
102
92
247,752
96 1,803,955
638,799
85
287,078
100
502,995
72
118,149
102
Total assets
3,731,608 4,112,301
91 3,731,608 3,791,407
98 4,112,301
91 3,790,556
Due to credit institutions and central banks
Repo deposits
Deposits
Bonds issued by Realkredit Danmark
Other issued bonds
Trading portfolio liabilities
Liabilities under insurance contracts
Other liabilities (including Non-core)
Subordinated debt
Shareholders' equity
71,592
238,059
102,772
217,035
1,092,945 1,155,841
735,183
307,773
590,249
661,884
131,285
39,503
170,775
712,186
308,444
480,024
486,606
134,766
38,338
168,648
70
110
71,592
238,059
85,592
176,323
95 1,092,945 1,156,302
724,600
97
324,000
100
510,299
81
480,034
74
131,358
103
38,324
97
164,575
99
712,186
308,444
480,024
486,606
134,766
38,338
168,648
84
135
102,772
217,035
95 1,155,841
735,183
98
307,773
95
590,249
94
661,884
101
131,285
103
39,503
100
170,775
102
70
110
91,159
137,920
95 1,169,879
711,773
97
298,068
100
554,321
81
488,891
74
139,918
103
38,350
97
160,278
99
Total liabilities and equity
3,731,608 4,112,301
91 3,731,608 3,791,407
98 4,112,301
91 3,790,556
Ratios and key figures
Dividend per share (DKK)
Earnings per share (DKK)
Return on avg. shareholders' equity (% p.a.)
Adj. return on avg. shareholders' equity (% p.a.)**
Net interest income as % p.a. of loans and deposits
Cost/income ratio (C/I), (%)
Adj. cost/income ratio (C/I), (%)**
Total capital ratio (%)
Common equity tier 1 capital ratio (%)
Share price (end of period) (DKK)
Book value per share (DKK)
Full-time-equivalent staff (end of period)
7.0
11.9
12.4
12.4
1.13
49.3
49.3
22.4
18.1
166.0
196.4
21,339
-
5.2
5.2
5.2
0.76
67.0
67.0
21.3
17.1
100.3
199.0
21,663
7.0
5.8
12.0
12.0
1.18
52.1
52.1
22.4
18.1
166.0
196.4
21,339
-
6.0
12.7
12.7
1.09
46.8
46.8
22.3
18.0
138.0
191.7
21,205
99
101
-
2.1
4.2
4.2
0.77
72.2
72.2
21.3
17.1
100.3
199.0
21,663
-
-5.4
-2.8
6.5
0.83
100.3
63.4
22.1
17.8
137.3
186.7
21,022
99
The financial highlights represent alternative performance measures that are non-IFRS measures. Note G3 provides an explanation of differences in the presentation between IFRS and the financial highlights. For a
description of the alternative performance measures used and definition of ratios, see Definition of Alternative Performance Measures on page 33.
*Comparative information for financial highlights has been restated as explained in note G3.
**Adjusted return on average shareholders’ equity and Adjusted cost/income ratio exclude the effect of the provision for Estonia matter and the impairment charges on goodwill. See Definition of Alternative Perfor-
mance Measures for more detail.
Executive summary
In the first half of 2023, Danske Bank continued to deliver on
our ambitions as a leading Nordic bank. Although macroeco-
nomic sentiment improved somewhat, as recent data points
indicated, the overall operating environment remained uncer-
tain given continued geopolitical tension and the higher inter-
est rate regime with a potential economic slowdown looming.
In this environment, we delivered a solid net profit for the first
half of 2023.
The solid result was driven by higher net interest income and
trading income in line with our outlook, by a part-recovery of
our insurance income and by loan impairments remaining at
a low level due to continually strong credit quality. Despite as-
sets under management (AuM) having increased somewhat
since 2022, fee income was, however, impacted by lower
fees from assets under management and by lower activity in
the housing market. Income from trading activities benefited
from more constructive conditions in the financial markets in
the first half of 2023 than in the same period of 2022, while
insurance activities were affected by negative valuation ef-
fects. In summary, this enabled us to achieve a return on eq-
uity of 12.4% and a net profit of DKK 10,178 million in the
first half of 2023.
In the current macroeconomic landscape, our solid financial
results, well-capitalised balance sheet and strong liquidity po-
sition continued to allow us to help our customers navigate
the macroeconomic and operating uncertainty by providing
expert advisory services and credit.
Moreover, to strengthen our position further and unleash
Danske Bank’s full potential, we announced our new Forward
’28 strategy at the Investor Day in early June, raising the bar
by setting new ambitions and committing to making signifi-
cant investments in our customer offerings within digital plat-
forms, expert advisory services and sustainability. As part of
the strategy, we have set new financial targets for 2026, with
which we commit to delivering a return on equity of 13%,
based on a cost/income ratio of around 45%, and remain
committed to maintaining an attractive capital distribution
policy.
In order to deliver on these ambitious targets, we announced
a new and sharpened focus in each market, with clear ambi-
tions to strengthen our position as a leading bank in the Nor-
dic region in a digital age. For business and large corporate
and institutional customers, we want to continue to build our
position as the leading wholesale and business bank in the
Nordic countries. For retail and private banking customers,
we will, with a sharpened focus in each market, continue our
strategic development to strengthen our relations with exist-
ing customers and attract new ones:
•
•
Denmark: We want to reaffirm our position as the bank
of choice across customer segments
Finland: We want to maintain our position, serving cus-
tomer needs across a broad set of segments and focus-
ing on customers with advanced needs in primarily ur-
ban areas
Danske Bank / Interim report – first half 2023 4/88
•
•
Sweden: We want to become the premium retail and
private banking bank for business owners and custom-
ers with advanced needs
Norway: We have decided to exit the market for per-
sonal customers in Norway to focus our efforts, invest-
ments and capital on other parts of our portfolio. We
want to be a leading bank for business, corporate and
institutional customers, and we have a very strong plat-
form, which we look forward to further strengthening
and growing.
Our steady progress within sustainability continued in the
second quarter of 2023. A key focus area for us is to support
our customers in their sustainable transition, which requires
our advisers to be equipped with specific skills in the area of
sustainability. So far this year, about 1,800 advisers and
managers at Personal Customers have finalised training to
integrate sustainability into our advisory services and cus-
tomer dialogue. In terms of sustainable finance, we also main-
tained our leading position. For instance, Danske Bank re-
cently raised equity for Green Hydrogen Systems, demon-
strating our ability to also support the sustainability agenda
and the green transition in the Equity Capital Markets space.
Moreover, Danske Bank received the ‘Best in Test’ award for
car loans for electric cars according to the Danish Consumer
Council ‘Tænk’ (Think) magazine, which has reviewed the fi-
nancing options of 12 different banks. Collectively, this
means our value proposition within sustainability is increas-
ingly attractive as we remain committed to supporting our
customers and society even more in the green transition.
Capital and funding
Danske Bank’s underlying business is strong, our treasury
asset and liability management is prudent, and our capital
and liquidity positions continue to be strong, with significant
buffers well above the regulatory requirements. At the end of
June 2023, our liquidity coverage ratio stood at 148% (31
December 2022: 151%), with an LCR reserve of DKK 551
billion (31 December 2022: DKK 570 billion), and our net
stable funding ratio stood at 124%.
Personal customer business in Norway
Following the Forward ’28 strategy announcement in June,
Danske Bank has entered into an agreement to sell its per-
sonal customer business in Norway to Nordea. The sale of
the personal customer business includes the management of
15 Danske Invest Horisont funds, which are primarily distrib-
uted to personal customers in Norway. The transaction is
subject to regulatory approvals. Pending these approvals and
preparation of the transfer of the customers, the transaction
is expected to close in the fourth quarter of 2024.
Financials
Net interest income increased to DKK 16,540 million (H1
2022: DKK 11,370 million). Net interest income benefited
from our repricing actions and further normalisation of inter-
est rates, despite a relatively flat development in volumes and
negative currency effects.
Net fee income decreased to DKK 5,693 million in the first
half of 2023 (H1 2022: DKK 6,537 million) as higher activity-
driven fees did not offset lower fee income due to lower in-
vestment and housing market activity.
Trading income of DKK 2,772 million in the first half of 2023
represents a significant recovery from the low level in the
first half of 2022. The new fixed income strategy imple-
mented at Large Corporates & Institutions towards the end
of 2022 resulted in more stable income, generated on the ba-
sis of a lower capital base. The first half of 2023 furthermore
benefited from the sale of shares taken over in connection
with a loan. The successful sale resulted in a gain of DKK 327
million.
Net income from Danica Pension recovered from the level in
the first half of 2022, due primarily to the more positive de-
velopments in the financial markets in the first half of 2023
and amounted to DKK 689 million.
In connection with the agreement to sell our personal cus-
tomer business in Norway, we incurred a negative one-off in
Other income of DKK 693 million related to prudent valuation
and expected transaction costs.
Operating expenses benefited from exchange rate develop-
ments, which were partly offset by inflation. Underlying ex-
penses continued to develop according to plan.
Credit quality was stable, with a low level of actual loan im-
pairments so far this year and reversals given an improved
macroeconomic outlook. To be prudent, we recognised addi-
tional post-model adjustments of DKK 0.2 billion related to
construction sector exposure.
The effective tax rate was positively affected by the reversal
of a provision of DKK 0.6 billion following a decision from the
tax authorities regarding the exit from the international joint
taxation scheme.
Danske Bank / Interim report – first half 2023 5/88
Danske IT in India
As part of our recently launched Forward ’28 strategy, we
have announced that Danske Bank has entered into a strate-
gic partnership to sell Danske IT, a fully-owned subsidiary of
Danske Bank headquartered in India, to Infosys, a global
leader in digital services and consulting. As part of the sale,
starting expectedly on 1 September 2023, 1,400 colleagues
in Danske IT will transfer to Infosys. The sale supports us in
the digital and technology transformation we have under-
taken to be a leading bank in a digital age.
Dividend for 2023
Based on our strong performance in the first half year of
2023 and our strong capital position at the end of the period,
the Board of Directors has, on the approval of the half-year
report, approved an interim dividend of DKK 7 per share, cor-
responding to 59% of net profit for the period.
Danske Bank’s dividend policy remains unchanged, targeting
a dividend payout of 40-60% of net profit. Danske Bank has
strong capital and liquidity positions, and the Board of Direc-
tors remains committed to our capital distribution policy.
Outlook for 2023
Net profit is expected to be in the range of DKK 18.5-20.5
billion, including the impact of the new Danish bank tax and
further positive tax-related one-offs.
We expect net interest income to continue to grow on the ba-
sis of the announced central bank rate hikes and our com-
mercial momentum, while fee income is expected to be below
the level in 2022. Trading income is expected to be impacted
by the release of a loss of DKK 0.8 billion from Other compre-
hensive income on the CET1 FX hedge related to the sale of
our personal customer business in Norway which is subject
to regulatory approval. Income from insurance is expected to
be lower than the normalised level due to negative valuation
effects and higher claims.
We expect costs in 2023 to be in the range of DKK 25-25.5
billion, reflecting our focus on cost management and despite
the inflationary pressure. The outlook includes continually el-
evated remediation costs for approximately DKK 1.1 billion.
We expect loan impairment charges of up to DKK 1.5 billion
(8 bp) due to continually strong credit quality, recoveries in
the first half of the year and lower-than-expected impact in
the first half from model-driven charges related to weaker
macroeconomic outlook.
The outlook is subject to uncertainty and depends on volume
growth and macroeconomic conditions.
Strategy execution
in the
last six months of our Better Bank
We are
transformation cycle and are advancing further towards our
stakeholder ambitions for 2023. And while we see continued
progress on our ambitions towards customers, employees,
shareholders and society, we are currently preparing to shift
our focus to delivering on Danske Bank’s Forward ’28
strategy announced on 7 June.
In this context, we announced key decisions to fuel the
organisation in relation to its ambition of being a focused
Nordic leader with strong profitability, as evidenced by both a
sizeable capital distribution and dividend potential and the
ambition to grow the return on equity to 13% by 2026. In
Norway, going forward, Danske Bank will focus on business,
institutional customers and will
large corporate and
discontinue serving personal customers to apply
its
investment muscle
in an even more targeted manner.
Moreover, we entered into a strategic partnership with
Infosys to further scale the IT capabilities in India and
accelerate digital development. This most recent step is part
of a multi-year
impactful change for
customers and shareholders by furthering our development
capabilities. Two years after transitioning to agile ways of
working, development processes are yielding the expected
outcomes while continuous adjustments to meet the needs
of the organisation are implemented.
journey to drive
the
the commercial
first half of 2023,
Throughout
momentum has been positive across our core banking
business. Despite the volatile macroeconomic environment
in the Nordic economies, we progressed towards meeting
our shareholder ambitions for 2023. The return on equity is
projected to exceed our ambition of 8.5-9% set in 2021 and
reached 12.4% at the end of the second quarter. The
cost/income ratio stood at 49.3% at 30 June 2023, and the
cost/income trajectory is also supported by our ongoing
efforts to further simplify our business and processes. For
instance, the review process to identify and close products
across customer segments resulted in the discontinuation of
some 80 products in the first six months of 2023. Reducing
the total number of products increases efficiency in terms of
maintenance and governance. At the same time, customers
experience that choosing the right product for their needs
becomes easier. We are now also reaping the benefits of
rigorously redesigning governance and processes related to
bringing new products to market, reducing the time-to-
market and making the organisation more agile in responding
to changing customer needs.
We are pleased to see that customers
increasingly
recognise our enhanced service and engagement models.
The progress can be seen, for example, in the results of
Voxmeter’s most recent survey encompassing some 9,000
respondents, which highlights our progress. Throughout the
last eight years, Voxmeter has measured satisfaction among
banks’ wealthy customers, and over the course of the past
eight years, Voxmeter has never encountered as large an
upward trend in performance as that achieved by Danske
Bank this year. Similarly, the Trustpilot ratings of customers
Danske Bank / Interim report – first half 2023 6/88
have increased from an average 2.1 to 4.3 of 5. Within the
Large Corporates & Institutions segment, we saw strong
performance in Foreign Exchange and are leading Nordic
Prospera ratings within Interest Rates Swaps and DCM
Investment Grade Issuance.
While customers’ perception improved, we continue to im-
prove Danske Bank as a workplace, and employee engage-
ment is rising. Our workplace vision is characterised by an
engaged workforce experiencing inclusion, flexibility, growth
and a deep sense of belonging. We are content to see that our
employee engagement levels across the Group continued the
positive development that began two years ago. In the latest
culture & engagement survey, the employee satisfaction &
motivation index score increased further from 76 in the
fourth quarter of 2022 to 77 in the second quarter of 2023,
reaching the end-of-year target, as reflected in the ambition
for employee engagement in our Better Bank plan. The in-
creased engagement levels are the result of collective efforts
throughout the organisation. Targeted initiatives supporting
the culture and workplace transformation include strength-
ening leadership capabilities, a hybrid work setup that sup-
ports collaboration, well-being and productivity, as well as an
emphasis on people development through regular develop-
ment-focused dialogues.
framework
Our commitment to protecting society and the integrity of the
financial markets also means that we continue our efforts set
out on the Compliance under Control agenda. All four of its
initiatives remain on track to be completed by the end of
2023. Following the successful implementation of enhanced
Market Abuse controls, we have fully implemented an
line with
effective market surveillance
regulatory obligations and market standards. The Conduct
Programme was completed at the end of the second quarter
of 2023
integration of conduct risk
management and sound business culture into day-to-day
operations, behaviours and decision-making. Work remains
on track to complete Transaction Monitoring and Sanctions
enhancements by year end and then to continue to embed all
elements of Compliance Under Control
initiatives into
‘business as usual’ as part of our commitment to maintaining
an effective compliance culture and effective governance,
systems and controls.
following the
in
Protecting society and the integrity of the financial markets
in which we operate remains central to our values and our
aim to maintain a sound business culture. In terms of
strengthening the robustness of our compliance and financial
crime frameworks, we are approaching 90% completion of
the execution of the multi-year remediation plan. Alongside
the execution of the Group Financial Crime Plan, which
remains a very high priority for the organisation, we also
continue to progress the digitisation of some of our
processes, for instance related to customer data, and as part
of this, we leverage reliable third-party information when we
are comfortable that this is within our risk appetite.
During the first half of 2023, we took several important steps
to advance our sustainability agenda, including the launch of
our Climate Action Plan and the inclusion of sustainability as
one of the strategic themes in our Forward ’28 strategy. Our
commercial momentum recently benefited, for instance,
from campaigns for homeowners to get financing for energy
improvements and recognition by the Danish Consumer
Council for one of the market's best loans for electric cars.
Personal Customers
We have taken a range of steps in Denmark to stabilise our
position as a leading full-service retail and private banking
bank and to establish a strong foundation for continued
change. We have focused on home finance initiatives, attract-
ing young customers and strengthening our retail investment
and sustainability offering, while also moving towards our fu-
ture digital and differentiated service model. Perception of
our brand is still impacted by the remediation cases, but we
see signs of a positive trajectory.
Meanwhile, we remain focused on commercial execution in
Finland and Sweden and have entered into an agreement to
sell our personal customer business activities in Norway to
focus on business customers and large corporates and insti-
tutions. Rising interest rates and high inflation continue to
dampen demand for lending, but portfolios are resilient and
maintain high credit quality. In Finland, we have established a
position with broad retail and private banking segment cover-
age, notably in urban areas, while in Sweden, we continue to
have a challenger position in an attractive market with strong
partnerships and relations with business owners. In both
markets we have focused on improving processes in the
home finance area to enable faster processing of loan appli-
cations.
In Denmark, we remain committed to being the bank of choice
for the majority of customer segments. In 2023, we build on
our recent commercial momentum and execute tactical initi-
atives within home finance, investments and service models
as part of our Better Bank plan. With the Forward ’28 strat-
egy, we will sharpen our value proposition and commercial fo-
cus. We see good progress in customer satisfaction levels,
which have risen following our progress in terms of closing
our remediation cases.
We continue to have a digitally savvy customer base, with
90% of customers using digital channels (access to Danske
Mobile Banking or Danske eBanking). During the first half of
2023, we remained the leading retail bank in terms of the dis-
tribution between online and physical meetings (with 63%
being online). To balance digital self-service and personal ad-
visory services, we continue to improve our services and of-
ferings while moving towards a single channel platform.
We already see positive developments in relation to our digi-
tal transformation agenda. To make it easy for our customers
in all markets to leverage our attractive savings accounts, we
introduced a feature that enables them to open and close
transaction and savings accounts directly in Danske Mobile
Banking. In Finland, we now have AI-enabled instant answers
to selected customer requests. This will be rolled out in Den-
mark in the second half of 2023 and subsequently in Sweden.
Danske Bank / Interim report – first half 2023 7/88
Besides our digital efforts, we have launched new products
internally and with partners. This includes a new saving ac-
count product called Danske Toprente, which allows custom-
ers in Denmark to get favourable rates on fixed term depos-
its. 85% of all such accounts are now opened via self-service.
With Tryg, we rolled out Tryg Låneforsikring, an insurance
product allowing customers in Denmark to insure payments
on home loans in case they lose their income. For invest-
ments, we had a silent launch in Denmark of our Danske
Monthly Investments solution, which makes it easy for cus-
tomers to invest a fixed amount each month in one or more
funds of their choice. We plan to launch this solution in Swe-
den and Finland in the second half of 2023.
During and beyond 2023, we will drive momentum by focus-
ing on three growth and profitability levers: making relation-
ships more efficient, broadening existing relationships with
customers and developing new relationships. We will con-
tinue to strengthen our private banking offering, invest in our
digital solutions and start initiatives across markets to
strengthen our marketing, commercial, partnership and advi-
sory capabilities.
Business Customers
1 May 2023 marked the one-year anniversary of the
Business Customers unit. The establishment of the unit has
enabled us to have a dedicated focus on small and medium-
sized business customers, with the ambition of being the
preferred bank for businesses with advanced needs and
offering an attractive value proposition for all businesses
across the Nordic countries, underpinned by a strong digital
foundation. In the first half of 2023, we maintained the focus
on the identified must-win areas to meet our business
objectives: driving cross-sales, prioritising pricing and capital
productivity and establishing a cost-efficient service model.
During the first half of 2023, we saw good results driven by
the market environments and stable growth in bank lending
across all market areas from the level in the same period last
year. Considering the currently uncertain macroeconomic
development, we have adopted a cautious approach in
certain segments, such as Commercial Real Estate. The
rapid changes in the macroeconomic environment also
resulted in several repricing actions.
To support our customers in the green transition, we
launched green asset financing for transportation, which has
received good traction, and we have so far financed more
than 11,000 cars, trucks and busses. In 2023, the scope for
green asset financing has and will continue to be broadened
to capture both small and large green asset financing
projects. Additionally, in collaboration with the Danish
interest organisation Lederne, we have launched the ESG
profile in Denmark. The ESG profile is a free digital self-
service tool aimed at enabling businesses to work more
strategically and systematically with sustainability. Among
other things, the tool can be used to create an overview of
existing ESG initiatives and to calculate relevant ESG metrics
by entering different data.
To further strengthen our digital value proposition towards
our corporate customers, District Marketplace was rolled
out to more than 100,000 users in Denmark in the first half
of 2023. Marketplace enables our customers to conven-
iently and seamlessly self-serve to get the most popular eve-
ryday banking products digitally. Marketplace was launched
in Sweden last year and quickly gained traction among our
business customers. Today, 11% of customers visiting Mar-
ketplace in Sweden buy a product digitally, and 23% of the
customers who ordered a product on Marketplace later re-
turn to order additional products. The next step is to launch
Marketplace in Norway and Finland, while adding more prod-
ucts and increasing the adoption rate in Sweden and Den-
mark. The work of digitalising customer journeys will con-
tinue to have high priority and is a key focus area in our new
strategy.
In the context of the new Forward ’28 strategy, Business
Customers will build on the strong momentum we have
across the four Nordic countries. Going forward, we aim to be
the market leader for Nordic business customers with
advanced needs,
international needs and sustainable
transformation ambitions. We will offer our customers
everyday banking solutions in a convenient and digital-first
setup and provide expert advice enabled by a highly skilled,
engaged and diverse business banking team.
Large Corporates & Institutions
Our ambition in 2023 is to develop and strengthen our posi-
tion as a leading Nordic wholesale bank while making a posi-
tive contribution to the Group’s ambition for the return on eq-
uity.
Despite the uncertainty in the macroeconomic environment,
we are progressing with the execution of our commercial ini-
tiatives communicated in September 2021 and saw a strong
performance in the first half of 2023.
In Equity Capital Markets, we saw that the improved market
conditions during the second quarter of the year led to a mar-
ket window for picking up ECM transactions, and we sup-
ported several customers in raising capital. Within M&A Ad-
visory, we remained in a leading position among the Nordic
banks, however, market activity in the Nordic countries was
relatively low in the first half of 2023 relative to the same pe-
riod last year. Our Debt Capital Markets business is experi-
encing a constructive market that enabled several of our
Danske Bank / Interim report – first half 2023 8/88
bond-issuing customers to be active across all the Nordic
markets.
Our ambition to meet the Group’s sustainability targets
through excelling in sustainable finance and responsible in-
vestments is showing good traction. Within the market for
green bonds, we are in the top nine in Bloomberg’s Global
Green Bonds league table, we have arranged more European
issuer green bonds than any other arranger, and we are the
leading Nordic arranger of sustainable bonds as well as the
leading arranger of sustainable bonds from Nordic issuers. In
addition, we have established a new dedicated team in Loan
Capital Markets to accelerate our efforts within Project & Re-
newable Energy Finance and take a more holistic approach.
We have therefore strengthened our value proposition within
sustainability during the first half year and can support our
customers and society even more in the green transition.
Within responsible investments, net zero is an important
long-term strategic goal, and we strive for a leading position
in the Nordic countries by continuing to integrate sustainabil-
ity into our products and advisory services. We have started
mapping out how we can better meet customer demand from
a sustainability perspective and further develop sustainabil-
ity-related reporting.
Finally, we saw our efforts in supporting customers reflected
in positive customer satisfaction ratings according to Pros-
pera research by Kantar, among which is a Nordic number
one position within DCM Investment Grade Issuance and In-
terest Rates Swaps and Nordic top two positions within Daily
Banking areas such as Cash Management, Foreign Exchange
and Trade Finance. Additionally, we saw a positive trend for
customers in Sweden driven not only by the market in general
but also by our focused efforts, supporting our strategic am-
bition to grow our business outside Denmark.
We are therefore confident that the finalisation of our LC&I
Better Bank strategy in 2023 will create a solid foundation
for the execution of our Forward ’28 strategy, where the fo-
cus will be on becoming the leading wholesale bank in the
Nordic countries. To do that, we will target our efforts on con-
tinuing the corporate growth journey outside Denmark,
strengthening and leveraging our one corporate platform and
deepening our relations with Nordic institutions.
Sustainability
At Danske Bank, we are committed to playing a leading role
in supporting a just and sustainable transition to a low-car-
bon society. And as Denmark’s largest bank and one of the
largest financial institutions in the Nordic countries, we have
the responsibility and ability to make a difference – for our
around 3.3 million customers and more broadly in the socie-
ties we are a part of. We contribute by providing specialist
financial advice and by financing our customers’ transition to
a more sustainable future.
During the first half of 2023, we took several important steps
to advance our sustainability agenda. These included the
launch of our Climate Action Plan and the inclusion of sus-
tainability as one of the strategic themes in our Forward ’28
strategy. The Climate Action Plan represents a significant
step up in our efforts to support the goals of the Paris Agree-
ment. The new climate goals in our Climate Action Plan have
been set in line with the criteria and recommendations pro-
vided by the Science Based Targets initiative (SBTi), and we
are now awaiting validation of our new goals by the STBi. The
Climate Action Plan covers the entire Danske Bank Group, in-
cluding Danica Pension and Realkredit Danmark, and it sets
specific 2030 targets for carbon emission reductions in re-
lation to customers, investees, pension investments and
Danske Bank’s own activities such as buildings and air travel.
Supporting our customers in their sustainable transitions re-
quires that our advisers are equipped with the necessary
skills in the relevant areas of sustainability. In the first half of
2023, around 1,800 advisers and leaders at Personal Cus-
tomers completed the first new module of sustainability dia-
logue training. This training is designed to build skills and de-
velop behaviour to integrate sustainability into our advisory
services and customer dialogue.
In the spring of 2023, Finans Danmark and the Danish Busi-
ness Authority launched the campaign Fyr dit Fyr (‘Banish
your Boiler'), which provides access to favourable financing to
Danish homeowners who are looking to replace their oil and
gas boiler with a greener alternative. At Danske Bank, we are
supporting this campaign with a flexible loan for energy-effi-
ciency improvements. Our aim is to make it easy for our cus-
tomers to make a sustainable choice, and we provide our cus-
tomers with a high degree of flexibility when we help them
switch to greener heating sources.
We are making strong progress with most of our sustainable
finance targets. Having already provided DKK 327 billion in
sustainable financing, including green loans and arranged
sustainability bonds, we have now surpassed our sustainable
financing target of DKK 300 billion by 2023, and we are also
very close to reaching our 2023 target for Danica Pension’s
investments in the green transition. The Nordic sustainable
finance market showed record volumes in the first half of
2023, and we have been very active in arranging sustainable
bonds for our customers. Danske Bank now ranks number 9
in Bloomberg’s Global Green Bonds league table (up on our
number 17 ranking at year-end 2022), and we arranged
more green bonds from European borrowers than any other
arranger in the first half of 2023.
Danske Bank / Interim report – first half 2023 9/88
As part of our Climate Action Plan, we complemented our
2023 targets for reducing our own CO2 emissions with a new
80% reduction target for scope 1 and 2 emissions by 2030.
Our projection based on the first half year indicates that we
are on track to achieve our 2023 target of a 40% CO2 reduc-
tion. With continued focus on more efficient utilisation of
floorspace in our own premises, we are seeing a decrease in
CO2 emissions from heat consumption of around 40% com-
pared with the same period last year. On the other hand, as
travel patterns are stabilising at a new post-pandemic level,
we are seeing a more than 100% increase in air travel emis-
sions compared with the same period last year.
Danske Bank has an increased focus on building and foster-
ing a culture of inclusion to attract, retain and grow talent.
Among leaders and employees, increased ownership is driv-
ing gender diversity through a top-down approach with a new
Diversity & Inclusion Council and through a bottom-up ap-
proach that includes sponsoring key and upcoming networks
and participation in initiatives and events. This is creating
new insights, connections and increased collaboration, all of
which are key to creating a sense of belonging, and it enables
us to benefit from the diversity that exists across the organi-
sation.
At both leadership and senior leadership levels, the percent-
age of women remains on par with the level at year-end 2022
(39% and 34% respectively), with the respective targets for
2023 being 40% and 35%.
By the end of 2022, we had already reached our 2023 target
of supporting 2 million people with financial literacy tools. All
in all, we have now supported 2.3 million people (year-end
2022: 2.1 million). In the first half of 2023, we have facilitated
dialogues with stakeholders on how to teach children about
managing money at a time when children are already gaming
and gambling before they have developed their own good
money habits.
Our support of entrepreneurship has increasingly focused on
providing banking services for start-ups and scale-ups. As a
consequence, we have sold the digital platform The Hub to
Norway’s MESH Community. As at the end of the first half of
2023, around 7,600 (year-end 2022: 7,231) start-ups and
scale-ups have used The Hub to recruit talent. We continue
to follow the number of companies supported by The Hub, and
we are happy to see that new jobs continue to be created;
however, we recognise that it is unlikely that the target we
previously set of supporting 10,000 start-ups and scale-ups
by year-end 2023 will be achieved.
Danske Bank / Interim report – first half 2023 10/88
Financial review
H1 2023 vs H1 2022
Net profit increased to DKK 10,178 million (H1 2022:
DKK 4,538 million) as a result of significant increases in net
interest income, net trading income and
income from
insurance business. Net profit also benefited from a decline
in both operating expenses and loan impairment charges.
Operating expenses
Operating expenses amounted to DKK 12,618 million (H1
2022: DKK 12,793 million) as underlying expenses contin-
ued to develop according to plan. Operating expenses bene-
fited from exchange rate developments, which were partly off-
set by inflation.
Income
Net interest income increased to DKK 16,540 million (H1
2022: DKK 11,370 million) and developed in line with our
expectations. The increase was due primarily to repricing
actions and income from deposits driven by the rise in market
rates.
Net fee income was down to DKK 5,693 million (H1 2022:
DKK 6,537 million). Higher income on everyday banking
services, such as cash management, was more than offset by
lower fees from assets under management and fees on
advisory services. Service fees increased due to repricing
actions and the transfer of customers to a subscription fee
service model implemented in mid-2022, but the increase
was offset by a decline in the fees for new lending generated
by our commercial real estate business that was caused by
the slowdown in the housing market.
Net trading income increased to DKK 2,772 million (H1
2022: DKK 320 million), driven by the fixed income strategy
implemented at Large Corporates & Institutions towards the
end of 2022, which resulted in more stable income that was
generated on the basis of continually high customer activity
and with very limited drawdowns despite a challenging
market environment. The first half of 2023 furthermore
benefited from the sale of shares taken over in connection
with a loan. The successful sale resulted in a gain of DKK 327
million.
Net income from Danica Pension recovered and amounted to
DKK 689 million (H1 2022: loss of DKK 103 million), due
primarily to more positive developments in the financial
markets in the first half of 2023. Danica Pension saw a rise
in new health & accident claims, and Danica Pension was also
not able to recognise the full risk allowance in the first half of
2023. The first half of last year also benefited from a
reduction of technical provisions related to the health &
accident business.
Other income amounted to a loss of DKK 106 million (H1
2022: DKK 959 million). The development was due mainly to
a provision related to prudent valuation and expected
transaction costs, amounting to DKK 693 million,
in
connection with the agreement to sell our personal customer
business in Norway. Furthermore, in the first half of 2022,
other income was positively affected by a one-off gain of DKK
421 million due to the sale of our activities in Luxembourg.
The Resolution fund, bank tax etc. item continued to increase
and stood at DKK 496 million (H1 2022: DKK 491 million).
Loan impairment charges
Loan impairments in core business segments remained low
overall in the first half of 2023, amounting to a net reversal
of DKK 28 million (H1 2022: charges of DKK 426 million).
Impairments reflect successful workout activities and
continued post-pandemic economic recoveries, contributing
to overall stable credit quality. The macroeconomic situation,
mainly in terms of declining property prices and interest rate
hikes, continues
the
macroeconomic landscape remains uncertain and develops
at a fast pace. We continue to apply significant post-model
adjustments related to the macroeconomic uncertainty and
remain watchful of any possible credit deterioration.
impairments, and
impact
to
Personal Customers saw an increase in impairment charges
in the first half of 2023 that was driven by a combination of
updated macroeconomic scenarios and falling property
prices. Underlying credit quality remained stable.
Business Customers had impairment charges lower than the
charges in the first half of 2022, while Large Corporates &
Institutions saw an increasing net loan impairment reversal
owing to successful restructuring within the shipping, oil &
gas industry and post-pandemic recoveries resulting in a
decline in charges made against facilities to individual
customers.
Loan impairment charges
First half 2023
First half 2022
(DKK millions)
Charges
% of net
credit
exposure1
% of net
credit
exposure1
Charges
Personal Customers
Business Customers
Large Corporates &
Institutions
Northern Ireland
Group Functions
478
142
-522
-131
5
0.12
0.04
-0.28
-0.49
0.55
Total core
-28
-0.00
325
198
-145
38
10
426
0.07
0.06
-0.10
0.14
0.50
0.04
1 Defined as net credit exposure from lending activities in core segments,
excluding exposure related to credit institutions and central banks and
loan commitments.
A low GDP, rising interest rates and downward pressure on
property prices remained the primary drivers of the
macroeconomic scenarios. The scenario weights were
updated from the end of 2022 and were as follows: The base-
case scenario has a probability of 60% (2022: 70%), the
upside scenario has a probability of 20% (2022: 10%) and
the downside scenario has a probability of 20% (2022: 20%).
Tax
The tax expense of DKK 2,794 million (H1 2022: DKK 1,343
million) corresponds to an effective tax rate of 21.5% (H1
2022: 22.8%). The effective tax rate in the first half of 2023
was positively affected by reversal of a provision of DKK 576
million following a final decision from the tax authorities
regarding the exit from the
international joint taxation
scheme in 2019, which more than offset the increase in the
tax rate applicable to financial institutions to 25.2% in 2023
from 22% in 2022.
DKK 5,011 million
Net profit
for the second quarter of 2023
Danske Bank / Interim report – first half 2023 11/88
Q2 2023 vs Q1 2023
Net profit decreased to DKK 5,011 million (Q1 2023:
DKK 5,167 million). The result was positively affected by an
increase in net interest income and lower loan impairment
charges, but the effect was more than offset by decreases in
the other income lines.
•
•
•
•
•
•
•
•
Net interest income increased to DKK 8,516 million
(Q1 2023: DKK 8,023 million), driven by increased
margins on deposits as a consequence of rising market
rates and repricing actions.
Net fee income amounted to DKK 2,739 million (Q1
2023: DKK 2,954 million), with the decline driven by
lower refinancing and loan establishment fees. Activity-
driven fees increased slightly, while investment fees
were on par with the preceding quarter, continuing the
positive trend from the first quarter of 2023 against the
level at the end of 2022. We saw lower income from
M&A advisory services, with the decrease being partly
offset by the effect of improved debt capital markets and
an increase in assets under management.
Net trading income decreased to DKK 1,160 million
(Q1 2023: DKK 1,612 million) as market conditions
were more supportive in the first quarter. However, our
customer franchise at Large Corporates & Institutions
continued to provide stable value, although at a lower
level than in the first quarter. The second quarter was
furthermore affected by the sale of shares taken over in
connection with a loan. The successful sale resulted in
a gain of DKK 327 million.
income
Net
from Danica Pension decreased to
DKK 192 million (Q1 2023: DKK 497 million). The
insurance service result increased DKK 33 million,
driven by a better result on group life insurance
products and an increase in income from unit-linked
insurance contracts, and this offset the effect of Danica
Pension not being able to recognise the full risk
financial result decreased due to
allowance. The
negative investment results on insurance products
where Danica Pension has the investment risk, due
mainly to the effect of developments in the real estate
market and in interest rates in the second quarter. The
investment returns on Danica Pension’s equity capital
also decreased in the second quarter.
Other income decreased to a loss of DKK 431 million
(Q1 2023: DKK 325 million) due mainly to a provision
related to prudent valuation and expected transaction
costs, amounting to DKK 693 million, in connection with
the agreement to sell our personal customer business
in Norway.
Operating expenses amounted to DKK 6,338 million
(Q1 2023: DKK 6,280 million) and were flat relative to
the first quarter.
impairment reversals
Loan
for core business
segments amounted to DKK 175 million in the second
quarter (Q1 2023: charges of DKK 147 million).
Impairment reversals were driven by resilient credit
quality and reversals of charges on facilities to
individual customers owing to successful workout
activities and continued post-pandemic recoveries.
Tax amounted to DKK 1,007 million (Q1 2023:
DKK 1,787 million). The effective tax rate was positively
affected by reversal of a provision of DKK 576 million
following a decision from the tax authorities regarding
the exit from the international joint taxation scheme in
2019.
Danske Bank / Interim report – first half 2023 12/88
Lending and deposits
Lending stood at DKK 1,753 billion (end-2022: DKK 1,804
billion). Mortgage lending at nominal value at Realkredit
Danmark amounted to DKK 804 billion (end-2022: DKK 802
billion). Lending volumes
in Sweden and Norway were
negatively affected by the depreciation of the currencies.
in Personal Customers
Deposit volumes
in Denmark
increased, driven primarily by the new savings products
launched in the first quarter of 2023. In addition, deposit
volumes in Norway decreased due to the announcement of
Danske Bank exiting the retail market in Norway and a
changed scope of the Akademikerne agreement.
At Large Corporates & Institutions, we have seen an increase
of 3% in lending volumes in General Banking since the end of
June 2022. The increase reflected the volatile operating
environment but was also the result of our strategic ambition
to grow our business in Sweden, where we have reached the
ambition set in 2021 to have welcomed 40 new Large
Corporates & Institutions customers by 2023. Relative to
the level at the end of 2022, total lending decreased 3%, due
mainly to a decrease in lending volumes in Norway as a result
of the depreciation of the Norwegian krone.
Bank lending volumes at Business Customers increased in all
four markets from the level in the same period last year.
Mortgage lending in Denmark at nominal value increased 3%,
however, measured at fair value, the increase was only 1%.
Combined with the depreciation of currencies, total lending
ended on par with the level in the same period last year.
Relative to the level at the end of 2022, total lending
decreased 1%.
At Personal Customers, the market share of bank lending in
Denmark continued to increase despite a slowdown in the
inflow of Danske Bolig Fri (home finance) volumes in the
second quarter of 2023. The slowdown in Danske Bolig Fri
volumes was a result of the general slowdown in the housing
market, which had a negative effect on mortgage volumes in
all four Nordic countries. We saw a positive inflow of bank
lending volumes in Denmark of 12%, driven by customers
looking for a flexible way to finance their homes in an
uncertain interest rate environment. Total lending volumes
across markets decreased 5% from the level at the end of
2022, mainly due to the depreciation of the currencies in
Sweden and Norway.
In Denmark, new gross lending, excluding repo
amounted
customers accounted for DKK 13.7 billion of this amount.
loans,
to DKK 60.8 billion. Lending to personal
In Denmark, our market share of bank lending, excluding repo
loans, to personal customers increased to 20.4% at the end
of May 2023
for business
(end-2022: 20.1%), and
customers, the market share decreased to 21.3% (end-
2022: 23.0%). The market share in Denmark, including
mortgage lending, decreased, however, to 24.3% at the end
of May 2023 (end-2022: 24.6%). In Finland, our market
share of lending increased to 9.7% as at the end of May 2023
(end-2022 9.6%) and in Norway, our market share of lending
decreased from 6.2% to 6.0% as at the end of May 2023. In
Sweden, we maintained our market share of lending at the
end-2022 level of 5.4%.
Deposits amounted to DKK 1,093 billion at the end of June
2023 (end-2022: DKK 1,170 billion). Deposit volumes in
Sweden and Norway decreased, due mainly
to the
depreciation of the currencies.
In Finland, we saw a good increase in deposit volumes in our
Business Customers segment. The increase was driven by
the public sector, however, it was offset primarily by a
conscious decision to reduce deposits in Norway.
In Denmark, our market share of deposits decreased to
27.4% at the end of May 2023 (end-2022: 28.3%).
In
Finland, Sweden and Norway, our market share of deposits
also decreased from the end-2022 levels.
Credit exposure
Credit exposure from lending activities in core business
increased to DKK 2,536 billion (end-2022:
segments
DKK 2,513 billion). The
increase was driven by higher
deposits with central banks, while the decrease in exposure
to Personal Customers Norway and Sweden was mainly
impacted by weaker NOK and SEK exchange rates.
Risk Management 2022, section 3, which is available at
danskebank.com/ir, provides details on Danske Bank’s credit
risks.
Credit quality
Credit quality remained strong in the first half of 2023 for all
business units. However, we remain vigilant for any possible
deterioration related to the uncertainty mentioned in the loan
impairment charges section above.
Stage 3 loans in core segments
(DKK millions)
Gross exposure
Allowance account
Net exposure
30 June 2023 31 Dec. 2022
29,946
8,041
32,132
8,251
21,905
23,881
Collateral (after haircut)
19,588
22,442
Stage 3 coverage ratio (%)
78
85
The stage 3 coverage ratio is calculated as allowance account stage 3
exposures relative to gross stage 3 net of collateral (after haircuts).
(end-2022:
in stage 3 decreased to
Total gross credit exposure
billion),
billion
DKK 29.9
corresponding to 1.2% of total gross exposure. Stage 3
exposure was concentrated on personal customers,
shipping, oil and gas, commercial property and agriculture,
which combined accounted for 65% of total gross exposure
in stage 3.
32.1
DKK
Total gross exposure in stage 2 has decreased DKK 26.1
billion since the end of 2022, primarily in the business and
personal customers segments, due mainly to portfolio
development.
The allowance account amounted to 1.05% (end-2022:
1.02%) of lending and guarantees.
Danske Bank / Interim report – first half 2023 13/88
our funding need. Note G7 provides more information about
bond issues in 2023.
Danske Bank’s liquidity position remained robust. At the end
of June 2023, our liquidity coverage ratio stood at 148% (31
December 2022: 151%), with an LCR reserve of DKK 551
billion (31 December 2022: DKK 570 billion), and our net
stable funding ratio stood at 124%.
At 30 June 2023, the total nominal value of outstanding long-
term funding, excluding debt issued by Realkredit Danmark,
was DKK 372 billion (31 December 2022: DKK 357 billion).
Capital ratios and requirements
At the end of June 2023, the Group’s total capital ratio was
22.4%, and its CET1 capital ratio was 18.1%, against 22.1%
and 17.8%, respectively, at the end of 2022. The movement
in the capital ratios in the first half of 2023 was driven by
realised net profit after reserved dividend and a decrease in
the total REA, which was partly counterbalanced by a decline
in the IFRS 9 add-back.
During the first half of 2023, the total REA decreased
approximately DKK 13 billion due mainly to a decline in the
REA for credit risk.
Danske Bank’s capital management policies are based on the
Internal Capital Adequacy Assessment Process (ICAAP). In
this process, Danske Bank determines its solvency need
ratio. The solvency need ratio consists of the 8% minimum
capital requirement under Pillar I and an individual capital
add-on under Pillar II.
At the end of June 2023, the Group’s solvency need ratio was
10.9%, an increase of 0.2 percentage points from the level at
the end of 2022.
A combined buffer requirement (CBR) applies to financial
institutions in addition to the solvency need ratio. At the end
of June 2023, the Group’s CBR was 7.5%, an increase of 0.5
in the national
percentage points due to
countercyclical buffer rates in Denmark and Norway from
2.0% to 2.5% as well as a rise in the Swedish buffer rate from
1.0% to 2.0%.
increases
Following a recommendation from the European Systemic
Risk Board (ESRB) on reciprocity on the 4.5% systemic risk
buffer (SyRB) implemented by the Norwegian authorities, the
Danish minister for Business, Industry and Financial Affairs
has decided to reciprocate the 4.5% Norwegian SyRB (on
Norwegian exposures), effective from 4 August 2023. The
Norwegian SyRB has, however, been part of the Group’s
ongoing and ordinary capital planning process, and the
implementation will not have any implications for the Group’s
capital targets.
Allowance account
by business units
(DKK millions)
Personal Customers
Business Customers
Large Corporates &
Institutions
Northern Ireland
Group Functions
30 June 2023
31 Dec. 2022
Accum.
impairm.
charges
% of credit
exposure1
Accum.
impairm.
charges
% of credit
exposure1
5,443
10,246
0.70 5,427
1.57 10,235
2,907
771
33
0.80 3,050
1.33 863
3.20 31
0.66
1.58
0.76
1.56
0.78
1.02
Total
19,400
1.05 19,605
1 Relating to lending activities in core segments.
Interest rate risk in the banking book
Danske Bank is exposed to interest rate risk in the banking
book resulting from providing the Group’s core banking cus-
tomers with conventional banking products and from the
Group’s funding and liquidity management activities at Group
Treasury (for more details, please see section 5.3.3 of our
Risk Management 2022 report).
As part of managing the interest rate risk in the banking book,
the Group holds high-rated bonds. To ensure aligned account-
ing treatment across the banking book, these bonds are held
at amortised cost. As interest rates have risen, asset values
in the banking book, including bonds held at amortised cost,
have fallen. This should be seen in light of the significant in-
crease in net interest income from deposits and the corre-
sponding impact on liability values. The carrying amount and
fair value of the Group’s hold-to-collect bond instruments can
be seen in note G13.
Funding and liquidity
The second quarter of 2023 was still somewhat affected by
equity and interest rate volatility due to high inflation prints,
focus on the US debt ceiling, numerous central bank interest
rate hikes and a continuously tense geopolitical situation. The
credit markets were active, with decent supply and stable in-
vestor appetite for Danske Bank issues.
At the end of June 2023, the Group had issued covered
bonds of DKK 14.3 billion, senior debt of DKK 23.7 billion and
non-preferred senior debt of DKK 16.1 billion, thus bringing
total long-term wholesale funding to DKK 54.1 billion.
Our strategy is to be a regular issuer in the EUR benchmark
format and in the domestic USD market for senior and non-
preferred senior bonds
in the Rule 144A format. Our
strategy of securing more funding directly in our main lending
currencies, including NOK and SEK, remains in place. The
benchmark issues are expected to be supplemented by
private placements of bonds.
From time to time, we will make issues in GBP, JPY, CHF and
other currencies when market conditions allow. Issuance
plans for subordinated debt in either the additional tier 1 or
tier 2 formats will depend on balance sheet growth and
redemptions on the one hand and our capital targets on the
other. Any issuance of subordinated debt may cover part of
Capital ratios and requirements
(% of the total REA)
Capital ratios
CET1 capital ratio
Total capital ratio
Capital requirements (incl. buffers)**
CET1 requirement
- portion from countercyclical buffer
- portion from capital conservation buffer
- portion from Norwegian SyRB
- portion from SIFI buffer (O-SII)
Solvency need ratio
Total capital requirement
Buffer to requirement
CET1 capital
Total capital
30 June
2023
Fully
phased-in*
18.1
22.4
13.7
2.0
2.5
0.0
3.0
10.9
18.3
4.4
4.1
17.9
22.2
14.3
2.0
2.5
0.5
3.0
10.9
18.9
3.6
3.3
* Based on fully phased-in rules and requirements, including the fully
phased-in impact of IFRS 9 and the 4.5% SyRB for Norwegian exposures
from August 2023.
** The total capital requirement consists of the solvency need ratio and
the combined buffer requirement. The fully phased-in countercyclical
capital buffer is based on the buffer rates announced at the end of June
2023. The 4.5% SyRB for Norwegian exposures from August 2023 is
included in the fully phased-in requirements.
The calculation of the solvency need ratio and the combined
capital buffer requirement is described in more detail in
section 6 of Risk Management 2022, which is available at
danskebank.com/ir.
Minimum requirement for own funds and eligible liabilities
The Danish FSA sets the MREL at two times the solvency
need plus one time the SIFI buffer and one time the capital
conservation buffer. Furthermore, the CBR must be met in
addition to the MREL. In the annual MREL decision from the
Danish FSA, the (backward-looking) MREL was set at 26.7%
of the total REA adjusted for Realkredit Danmark.
At the end of June 2023, the point-in-time requirement
including the CBR was equivalent to DKK 240 billion, or
34.7% of the total REA adjusted for Realkredit Danmark.
Taking the deduction of capital and debt buffer requirements
for Realkredit Danmark into account, MREL-eligible liabilities
amounted to DKK 273 billion. In addition, an MREL of 6% of
the leverage ratio exposure (LRE) is in place. The LRE-based
requirement equalled 22.4% of the total REA adjusted for
Realkredit Danmark, making the REA-based requirement the
binding constraint.
The Danish FSA has set the subordination requirement as
the higher of 8% of total liabilities and own funds (TLOF) and
two times the solvency need plus one time the CBR.
At the end of June 2023, the subordination requirement was
equivalent to DKK 202 billion. The backward-looking
subordination requirement, as set by the Danish FSA, was
28.5% of the total REA adjusted for Realkredit Danmark.
MREL-eligible subordinated liabilities stood at DKK 230
billion.
Danske Bank / Interim report – first half 2023 14/88
Note: The requirement and eligible funds are adjusted for Realkredit Dan-
mark’s capital and debt buffer requirements.
Leverage ratio
At the end of June 2023, the Group’s leverage ratio was
5.0% under the transitional rules and 4.9% under the fully
phased-in rules.
Capital targets and capital distribution
The CET1 capital ratio target of above 16% was re-affirmed
at the Group’s Investor Update on 7 June 2023 and ensures
a sufficiently prudent buffer in relation to the capital require-
ment. Danske Bank fully meets this capital target.
The Board of Directors will continue to adapt the capital
targets to regulatory developments in order to ensure a
strong capital position.
Based on our strong performance in the first half of 2023
and our strong capital position at the end of the period, the
Board of Directors has, on the approval of the half-year re-
port, approved an interim dividend of DKK 7 per share, corre-
sponding to 59% of net profit for the period.
Danske Bank’s dividend policy remains unchanged, targeting
a dividend of 40-60% of net profit.
Danske Bank has strong capital and liquidity positions, and
the Board of Directors remains committed to our capital
distribution policy.
The Supervisory Diamond
The Danish FSA has identified a number of specific risk
indicators for banks and mortgage institutions and set
threshold values with which all Danish banks must comply.
The requirements are known as the Supervisory Diamond.
At the end of June 2023, Danske Bank was in compliance
with all threshold values. A separate report is available at
danskebank.com/ir.
Realkredit Danmark also complies with all threshold values.
New regulation
As part of the EU Banking Package 2021 and in order to
implement Basel IV, the European Commission adopted
proposals in October 2021. On 27 June 2023, the EU co-
legislators reached a provisional political agreement on the
proposals for implementing Basel IV.
the expected REA
On the basis of the Group’s current and updated analysis of
the EU Banking Package 2021, including the provisional
agreement, the Group’s current capital planning takes into
account
initial
implementation in 2025. The fully phased-in impact of the EU
Banking Package on the Group depends on the final legal text,
which is still outstanding. Taking into account the transitional
arrangements with regard to the output floor, the Group
currently expects the output floor to restrict the Group at the
earliest in 2033, when the transitional arrangements are set
to lapse.
impact of
the
Credit ratings
On 10 July 2023, Moody’s revised its outlook for Danske
Bank to Positive from Stable, while affirming all ratings. There
were no other credit rating changes in the second quarter of
2023.
Danske Bank’s credit ratings
Fitch
Moody’s
S&P
Counterparty rating
A+
A1/P-1
AA-/A-1+
Deposits
A+/F1
A2/Positive
/P-1
Senior debt
A+/F1
A3/P-2
A+/A-1
Issuer rating
A/F1
A3/P-2
A+/A-1
Outlook
Stable
Positive
Stable
Non-preferred
senior debt
Tier 2
AT1
A
Baa2
BBB+
BBB+
BBB-
-
-
BBB
BB+
Danske Bank / Interim report – first half 2023 15/88
Environmental, Social and Governance (ESG) ratings
Moody’s ESG Solutions downgraded Danske Bank to 60 from
61 in April 2023 due to a lowering of the social assessment
in environment and
partially offset by an improvement
governance.
Danske Bank’s ESG ratings
Score at
30 June
2023
Score at
31 March
2023
CDP Worldwide, UK
B
B
ISS ESG, USA
C+ Prime
C+ Prime
MSCI ESG Ratings, USA
BBB
BBB
Sustainalytics, USA
Medium Risk Medium Risk
Moody’s ESG Solutions, USA
60
61
Estonia matter
As announced on 13 December 2022, Danske Bank has
reached
the US
final coordinated resolutions with
Department of Justice (DoJ), the US Securities and Exchange
Commission (SEC) and the Danish Special Crime Unit (SCU)
following the investigations into failings and misconduct
related to the non-resident portfolio at Danske Bank’s former
Estonia branch. The aggregate amounts payable to the US
and Danish authorities were paid in January 2023. The
coordinated resolutions marked the end of the criminal and
regulatory investigations into Danske Bank by the authorities
in Denmark and the United States.
As part of the Bank’s agreement with DoJ, Danske Bank was
placed on corporate probation for three years from 13
December 2022 until 13 December 2025, and Danske Bank
is committed to continuing to
its compliance
programmes. Danske Bank has taken extensive remediation
action to address those failings to prevent any similar
occurrences, and the Bank remains in contact with DoJ as a
matter of post-resolution obligations set
in the
agreement with DoJ.
improve
forth
The Bank remains subject to a criminal investigation by
authorities in France and has posted bail in the amount of
DKK 80 million. The Bank continues to cooperate with the
authorities.
Civil claims
Danske Bank is subject to ongoing litigation in relation to the
Estonia matter. This includes, inter alia, an action against
Danske Bank (and other defendants) in the US and a number
of court cases initiated against Danske Bank in Denmark.
These civil claims were not included in the coordinated
resolutions with DoJ, SEC, and SCU. Danske Bank will
continue to defend itself vigorously against these claims. The
timing of completion of any such civil claims (pending or
threatening) and their outcome are uncertain and could be
material.
Update on the debt collection case
As announced on 31 August 2022, Danske Bank has chosen
an accelerated solution for its debt collection customers,
whereby approximately 90,000 debt collection customers in
Denmark will have their debt to the bank set to zero, and
Danske Bank will not collect this debt. In the fourth quarter of
2022, we began communicating to customers whose debt is
set to zero and at present, about 80% of the debt in approxi-
mately 90,000 active customer cases has been set to zero.
Furthermore, Danske Bank has decided to pay compensation
on the basis of a data-driven model to the customers who
were at risk of having been subject to overcollection related
to the issues in the historical debt collection systems.
The work involved in paying compensation to the debt collec-
tion customers who may have been subject to overcollection
has begun and we expect the compensation payout to the
vast majority of these customers to be completed by the end
of 2023.
In the third quarter of 2022, operating expenses were im-
pacted by a one-off amount of DKK 600 million, whereas
write-downs of debt increased loan impairment charges by a
one-off amount of DKK 650 million, which includes part of the
compensation to customers. It was furthermore communi -
cated that further sample checks related to the customer
compensation model were needed, and this work has now re-
sulted in us taking a more conservative approach, which is to
the benefit of our debt collection customers. This approach
impacted our operating expenses by a further DKK 310 mil-
lion in the fourth quarter of 2022 to cover compensation to
debt collection customers for potential overcollection of debt.
Danske Bank / Interim report – first half 2023 16/88
Danske Bank continues to have a dialogue with and report
progress with the debt collection case to the impartial re-
viewers appointed by the Danish FSA.
Personal customer business in Norway
Following the Forward ’28 strategy announcement in June,
Danske Bank has entered into an agreement to sell its per-
sonal customer business in Norway to Nordea. The sale of
the personal customer business includes the management of
15 Danske Invest Horisont funds, which are primarily distrib-
uted to personal customers in Norway. The transaction is
subject to regulatory approvals. Pending these approvals and
preparation of the transfer of the customers, the transaction
is expected to close in the fourth quarter of 2024.
Danske Bank enters into strategic partnership with Infosys
As part of our recently launched Forward ’28 strategy, we an-
nounced our ambition to be a leading bank in a digital age. To
support us in this digital and technology transformation, we
now enter into a strategic partnership with Infosys, a global
leader in digital services and consulting.
As part of the partnership, Danske Bank will sell Danske IT, a
fully-owned subsidiary of Danske Bank headquartered in Ben-
galuru, India, to Infosys. Danske IT covers IT development and
operations for Danske Bank. The deal is subject to customary
authority approval, expected in the second half of 2023. As
part of the sale, starting expectedly 1 September 2023, our
1,400 colleagues in Danske IT will transfer to Infosys, which
employs more than 300,000 people globally.
Danske Bank / Interim report – first half 2023 17/88
Business units
Danske Bank / Interim report – first half 2023 18/88
Personal Customers
In the first half of 2023, Personal Customers saw an increase in net interest income of 81% from the same period last year, mainly
as a result of repricing actions and higher income from deposits that was driven by market developments. Although there have been
small signs of improvement in the housing market and more optimism on the financial markets, we have seen only initial signs of a
pick-up in activity.
Profit before tax in the first half of 2023 amounted to DKK 3,620 million, an increase of 109% from the same period in 2022 that
was driven by higher net interest income and lower operating expenses due to a reduction in the number of FTEs. Following the
agreement to sell our personal customer business in Norway to Nordea, a provision of DKK 693 million was made in the second
quarter of 2023. Credit quality remained solid, but due to the macroeconomic outlook, loan impairment charges increased to DKK
478 million.
Personal Customers
(DKK millions)
Net interest income
Net fee income
Net trading income
Other income
Total income
Operating expenses
of which resolution fund, bank tax etc.
Profit before loan impairment charges
Loan impairment charges
First half First half
2022
2023
Index
23/22
7,017
2,022
171
-650
8,560
4,462
85
4,098
478
3,871
2,555
220
508
7,154
5,097
81
2,057
325
181
79
78
-
120
88
105
199
147
Q2
2023
3,611
950
86
-670
3,977
2,209
44
1,768
66
3,405
1,072
85
20
4,583
2,253
41
2,330
412
Profit before tax
3,620
1,732
209
1,702
1,918
Q1
2023
Index
Q2/Q1
Q2
2022
Index Full year
2022
23/22
106
89
101
-
87
98
107
76
16
89
1,935
1,219
116
45
3,315
2,530
41
785
327
458
187
78
74
-
120
87
107
225
20
8,778
4,730
444
987
14,939
10,104
161
4,836
927
-
3,909
97 830,890
5,233
98
101 420,252
101 607,496
30,881
99
92 805,120
92
4,727
98 410,806
100 612,997
30,898
95
Loans, excluding reverse transactions before impair-
ments
Allowance account, loans
Deposits, excluding repo deposits
Covered bonds issued
Allocated capital (average)
Net interest income as % p.a. of loans and deposits
Profit before loan impairment charges as % p.a. of al-
located capital
Profit before tax as % p.a. of allocated capital (avg.)
Cost/income ratio (%)
Full-time-equivalent staff
4,810
767,784 830,890
5,233
413,514 420,252
607,405 607,496
31,170
29,575
4,810
92 767,784 788,736
92
4,901
98 413,514 411,316
100 607,405 602,840
29,713
29,439
95
1.19 0.62
-
1.23 1.15
-
0.62
-
0.71
27.7 13.2
24.5 11.1
52.1 71.2
4,288 4,874
-
-
-
88
24.0 31.4
23.1 25.8
55.5 49.2
4,288 4,277
-
-
-
100
10.2
5.9
76.3
4,874
-
-
-
88
15.7
12.7
67.6
4,262
Fact Book Q2 2023 provides financial highlights at customer type level for Personal Customers. Fact Book Q2 2023 is available at danskebank.com/ir.
Business initiatives
Although inflation levels have decreased, core inflation con-
tinued to be at an elevated level. In these challenging times,
we have provided specialist expertise to our customers when
they make important financial decisions and need a financial
sparring partner, especially in relation to home ownership
and important life events. In general, we saw good progress
in customer satisfaction scores across markets, and, as an
example, on Trustpilot in Denmark, we went from a score of
2.1 to a score of 4.3 of 5.
The positive development in income was driven by higher net
interest income on deposits as a result of the increase in de-
posit margins on the back of several central bank rate hikes
across all markets combined with prudent repricing actions.
Lending margins, however, continued to be under pressure
from the rise in market rates.
Despite minor improvements, the housing market remained
challenged by low customer activity relative to same period
last year, which resulted in lower income from establishment
fees and less remortgaging activity. In the financial markets,
optimism has started to spark, leading to some improvement
in assets under management and subsequently investment
fees. However, our competitive savings products continued
to be more attractive for our customers in the current, high
interest rate environment. This also influenced customer in-
vestment appetite, keeping assets under management at a
lower level than at the beginning of 2022.
Following our Forward ’28 strategy announcement in June,
we have entered into an agreement to sell our personal cus-
tomer business in Norway to Nordea. The transaction is sub-
ject to regulatory approvals. Pending these approvals and
preparation of the transfer of the customers, the transaction
is expected to close in the fourth quarter of 2024.
Danske Bank / Interim report – first half 2023 19/88
Loan impairment charges amounted to DKK 478 million in
the first half of 2023 against charges of DKK 325 million in
the first half of 2022. The level of impairment charges was
driven by a combination of updated macroeconomic scenar-
ios and decreasing property prices. Underlying credit quality
remained stable.
Credit exposure
Credit exposure decreased to DKK 849 billion at the end of
June 2023 (end-2022: DKK 883 billion), driven mainly by
lower exposure in Personal Customers Norway and Sweden,
where exposure was impacted mainly by weaker NOK and
SEK currency exchange rates.
H1 2023 vs H1 2022
Profit before tax amounted to DKK 3,620 million (H1 2022:
DKK 1,732 million) and was driven by the effect of higher net
interest income from deposits and lower operating expenses,
which was partly offset by a provision related to prudent val-
uation and expected transaction costs for the sale of our per-
sonal customer business in Norway. The financial results
were adversely affected by the depreciation of the Swedish
krona and the Norwegian krone.
Net interest income increased to DKK 7,017 million (H1
2022: DKK 3,871 million) due primarily to repricing actions
and higher income from deposits driven by the rise in market
rates, with some of the effect being offset by the allocation
from Group Treasury to Personal Customers of interest rate
risk related to deposits.
Deposit volumes in Denmark increased 4%, driven primarily
by the new savings products launched in the first quarter. To-
tal deposit volumes decreased 2%, due mainly to the depre-
ciation of the currencies in Sweden and Norway. In addition,
deposit volumes in Norway decreased as a result of the
changed scope of the Akademikerne agreement as well as
the announcement of Danske Bank exiting the personal cus-
tomers market in Norway.
There was a positive inflow of bank lending volumes in Den-
mark of 12%, driven by customers looking for a flexible way
to finance their homes in an uncertain interest rate environ-
ment. The market share of bank lending in Denmark also con-
tinued to increase, despite a slowdown in the inflow of Danske
Bolig Fri (home finance) volumes in the second quarter of
2023. The slowdown in Danske Bolig Fri volumes was a re-
sult of the general slowdown in the housing market, which
also had a negative effect on mortgage volumes in all four
Nordic countries. The depreciation of the currencies in Nor-
way and Sweden had a negative effect of DKK 25 billion. Total
lending across markets decreased 10%.
Net fee income decreased to DKK 2,022 million (H1 2022:
DKK 2,555 million). Fee income from financing activity de-
creased due to lower customer activity driven by the general
slowdown in the housing market. Income from investment
fees decreased as a result of the uncertainty in the financial
markets, but with an uplift in activity in the first half of 2023
from the level at the end of 2022.
Net trading income decreased to DKK 171 million (H1 2022:
DKK 220 million) due to lower customer activity.
Other income amounted to DKK a negative 650 million (H1
2022: DKK 508 million). The development was due mainly to
a provision related to prudent valuation and expected trans-
action costs, amounting to DKK 693 million, in connection
with the agreement to sell our personal customer business
in Norway, as well as the year-earlier period benefiting from
a one-off gain of DKK 421 million on the sale of our customer
portfolio in Luxembourg.
Operating expenses decreased to DKK 4,462 million (H1
2022: DKK 5,097 million) driven by fewer FTEs and the di-
vestment of MobilePay as well as prudent cost control.
Danske Bank / Interim report – first half 2023 20/88
Q2 2023 vs Q1 2023
Profit before tax in the second quarter of 2023 decreased
to DKK 1,702 million (Q1 2023: DKK 1,918 million) driven
by a provision related to prudent valuation and expected
transaction costs for the sale of the personal customer
business in Norway.
•
•
•
•
•
•
•
Net interest income increased 6%, driven by higher
margins on deposits as a consequence of rising market
rates and repricing actions. Some of the effect was
offset by the allocation from Group Treasury to
Personal Customers of the cost of hedging the interest
rate risk related to deposits.
Net fee income decreased 11% from the preceding
quarter, driven by lower refinancing and loan establish-
ment fees. Activity-driven fees increased slightly, while
investment fees were on par with the preceding quar-
ter, continuing the positive trend from the first quarter
of 2023 relative to the end of 2022.
Other income decreased to a loss of DKK 670 million
due mainly to a provision related to prudent valuation
and expected transaction costs, amounting to DKK 693
million, in connection with the agreement to sell our
personal customer business in Norway.
Operating expenses decreased 2% due to seasonality
in IT expenses.
The second quarter of 2023 saw loan impairment
charges of DKK 66 million (Q1 2023: DKK 412 million).
Credit exposure decreased to DKK 849 billion at the
end of June (end-March 2023: DKK 867 billion), due
mainly to a decline in exposure in Personal Customers
Norway and Sweden, where exposure was impacted
mainly by weaker NOK and SEK currency exchange
rates.
Total lending volumes decreased 4% due to the
slowdown in the housing market and depreciation of
currencies.
Deposit volumes increased 1% owing to an increase in
Denmark of 2% driven by the new savings products
launched in the first quarter of 2023.
DKK 1,702 million
Profit before tax
for the second quarter of 2023
Danske Bank / Interim report – first half 2023 21/88
Business Customers
Business Customers continued to benefit from slightly better market conditions. Profitability increased, driven primarily by higher
income from deposits that was a result of repricing actions and the rise in market rates. We saw growth in lending volumes across
markets. Despite small improvements in the economy and more stability on the financial markets, customer activity remained
somewhat subdued, which affected activity-driven fees and fees from new lending. We continued to support our customers in
navigating through these challenging times with expert financial advisory services and continued to see high customer satisfaction.
In the first half of 2023, profit before tax amounted to DKK 4,957 million, an improvement of 77% from the level in the same period
in 2022.
Business Customers
(DKK millions)
Net interest income
Net fee income
Net trading income
Other income
Total income
Operating expenses
of which resolution fund, bank tax etc.
Profit before loan impairment charges
Loan impairment charges
First half First half
2022
2023
Index
23/22
5,864
893
261
536
7,555
2,455
127
5,099
142
4,083
906
243
431
5,663
2,665
112
2,997
198
144
99
107
124
133
92
113
170
72
Q2
2023
2,936
438
139
250
3,763
1,209
65
2,554
-7
Q1
2023
Index
Q2/Q1
Q2
2022
Index Full year
2022
23/22
2,927
456
122
287
3,792
1,246
63
2,546
149
100
96
114
87
99
97
103
100
-
2,110
426
134
231
2,902
1,352
54
1,550
86
139
103
104
108
130
89
120
165
-
9,175
1,825
517
847
12,364
5,356
224
7,008
578
Profit before tax
4,957
2,799
177
2,561
2,396
107
1,464
175
6,430
Loans, excluding reverse transactions before impair-
ments
Allowance account, loans
Deposits, excluding repo deposits
Covered bonds issued
Allocated capital (average)
Net interest income as % p.a. of loans and deposits
Profit before loan impairment charges as % p.a. of al-
located capital
Profit before tax as % p.a. of allocated capital (avg.)
Cost/income ratio (%)
Full-time-equivalent staff
9,012
633,909 634,239
8,474
261,293 290,934
352,061 348,195
39,869
39,457
100 633,909 635,948
9,153
9,012
106
90 261,293 279,388
101 352,061 349,891
39,389
39,525
99
100 634,239
98
8,474
94 290,934
101 348,195
39,417
100
100 639,557
8,938
106
90 285,177
101 344,445
39,623
100
1.29 0.88
-
1.30 1.28
-
0.91
-
0.99
25.8 15.0
25.1 14.0
32.5 47.1
1,677 1,696
-
-
-
99
25.8 25.9
25.9 24.3
32.1 32.9
1,677 1,664
-
-
-
101
15.7
14.9
46.6
1,696
-
-
-
99
17.7
16.2
43.3
1,635
Fact Book Q2 2023 provides financial highlights at customer type level for Business Customers. Fact Book Q2 2023 is available at danskebank.com/ir.
Business initiatives
Although the macroeconomic environment was challenging,
the economy in general improved during the first half of
2023. Inflation was still at an elevated level but slowed down,
due primarily to energy prices being back at normalised lev-
els. The central banks continued to hike market rates during
the first half of 2023 to get inflation under control. We con-
tinued to support our customers navigate through these
challenging times by providing financial advisory services
across customer segments. Customer satisfaction was high
among our business customers. For medium-sized busi-
nesses, we were ranked number one on customer satisfac-
tion in Norway and Finland. In Denmark, we saw a positive
trend for both small and medium-sized businesses and were
ranked number two in both segments.
The rising market rates and repricing of deposits were the
primary factors behind the positive effect on total income for
the first half of 2023. Trading income rose due to an in-
creased need for hedging that was driven by fluctuations in
exchange rates. Income from the sale of used assets contin-
ued to be at a high level, with both high sales prices and high
volumes.
Despite small improvements in the economy and more sta-
bility on the financial market, customer activity remained at a
lower level than in the year-earlier period. As a result, loan
establishment fees, income from remortgaging activity and
investment income were subdued. However, there was bet-
ter traction on the capital markets with an uplift in income
from corporate finance transactions and derivative products
in commercial real estate.
Our commercial property portfolio remained stable even
though the sector felt the impact of the rising market rates
and widening credit spreads. The commercial real estate
portfolio is well diversified across the four Nordic markets
and on property segments, that is, residentials, offices, etc.
The overall exposure to the sector has been stable for the
past five years. Property prices are adjusting to the higher in-
terest rates that affect loan-to-value ratios in the portfolio.
We continued to have a strong focus on helping our custom-
ers mitigate the risk by supporting their ability to generate
cash flow resilience and de-risk their portfolio and by support-
ing them on ESG investments.
H1 2023 vs H1 2022
Profit before tax amounted to DKK 4,957 million (H1 2022:
DKK 2,799 million). The increase was driven by income from
deposits as a result of repricing actions and rising market
rates as well as lower operating expenses. The financial per-
formance was adversely affected by the depreciation of cur-
rencies.
Net interest income increased 44%, driven by higher income
on deposits following repricing actions and market rate de-
velopments. Some of the effect was offset by the allocation
from Group Treasury to Business Customers of the cost of
hedging the interest rate risk related to deposits.
We saw a good increase in deposit volumes in Finland driven
by the public sector. The effect was, however, offset primarily
by a conscious decision to reduce deposits in Norway. Com-
bined with the depreciation of the currencies in Sweden and
Norway, total deposit volumes decreased 10%.
Bank lending volumes increased in all four markets from the
level in the same period last year. Mortgage lending in Den-
mark at nominal value increased 3%, however, measured at
fair value, the increase was only 1%. Combined with the de-
preciation of currencies, total lending ended on par with same
period last year.
Net fee income decreased slightly to DKK 893 million (H1
2022: DKK 906 million). Service fees increased due to re-
pricing actions as well as the transfer of customers to a sub-
scription fee service model implemented in mid-2022. The
increase in service fees was offset by a decline in fees from
new lending related to our commercial real estate business
caused by the slowdown in the housing market.
Net trading income increased to DKK 261 million (H1 2022:
DKK 243 million), driven by FX volatility resulting in increased
demand for hedging.
Operating expenses stood at DKK 2,455 million, a decrease
of 8% from the same period last year. The decrease was
driven by fewer FTEs and lower IT costs.
Credit quality remained solid in the first half of 2023. Loan
impairment charges amounted to DKK 142 million, which
was comparable to the level in the first half of 2022.
Credit exposure
Credit exposure decreased to DKK 736 billion at the end of
June 2023 (end-2022: DKK 745 billion), driven mainly by
lower exposure to the Commercial Property and Other Com-
mercials exposure categories.
Danske Bank / Interim report – first half 2023 22/88
Q2 2023 vs Q1 2023
Profit before tax in the second quarter of 2023 increased to
DKK 2,561 million (Q1 2023: DKK 2,396 million). The
lower
increase was driven by higher trading
operating expenses and reversals of loan
impairment
charges.
income,
•
•
•
•
•
•
•
•
Net interest income increased slightly and stood at
DKK 2,936 million (Q1 2023: DKK 2,927 million),
driven by an increase in deposit margins that was partly
offset by the allocation from Group Treasury to
Business Customers of the cost of hedging the interest
rate risk related to deposits.
Net fee income decreased 4%, driven by fees from new
lending due to the slowdown in the housing market as
well as a reduction in income from service fees.
Net trading income increased to DKK 139 million (Q1
2023: DKK 122 million) due to FX volatility and an
increased need for hedging.
Other income decreased 13% due to extraordinarily
high income from the sale of used assets in the first
quarter of 2023.
Operating expenses decreased 3%. The decrease in ex-
penses was driven primarily by seasonality in IT ex-
penses.
Deposit volumes increased in Sweden, Denmark and
Finland but the increase was offset by a conscious deci-
sion to reduce deposits in Norway as well as the depre-
ciation of currencies.
Lending volumes were on par with the preceding quar-
ter, driven by an increase in Denmark, Norway and Fin-
land, the effect of which was offset by a decrease in
Sweden as well as the depreciation of currencies.
The second quarter of 2023 saw loan impairment re-
versals of DKK 7 million (Q1 2023: net charges of
DKK 149 million). The low level of impairments was
driven by successful workout activities. Credit exposure
increased to DKK 736.3 million at the end of the second
quarter of 2023 from DKK 735.8 billion at the end of
the first quarter of 2023.
DKK 2,561 million
Profit before tax
for the second quarter of 2023
Danske Bank / Interim report – first half 2023 23/88
Large Corporates & Institutions
During the first half of 2023, market volatility decreased, but risks remained, stemming from an uncertain monetary policy outlook,
sticky inflation and tight labour markets. We maintain a close dialogue with our customers and support them with advisory services
and credit and risk management solutions, and we are strategically well positioned to meet the increased demand arising from the
sustainable transition. We continue to see a positive underlying momentum with a robust credit portfolio and signs of improved
activity in the capital markets. Moreover, with an increasing market share in cash management services – exemplified by new house
bank mandates across all Nordic countries – and with a continued inflow of new customers in Sweden, we continued to see growth
in net interest income. In addition, we are proud to have maintained our leading position in sustainable finance, arranging more green
bonds for European borrowers than any other arranger in the first half of 2023.
Profit before tax amounted to DKK 5,006 million, an increase of 125% from the same period last year, due primarily to higher net
trading income and net interest income.
Large Corporates & Institutions
First half First half
Index
Q2
Q1
Index
Q2
Index Full year
2023
2022
23/22
2023
2023
Q2/Q1
2022
23/22
2022
(DKK millions)
Net interest income
Net fee income
Net trading income
Other income
Total income
Operating expenses
of which resolution fund, bank tax etc.
Profit before loan impairment charges
Loan impairment charges
3,414
2,641
1,960
12
8,028
3,543
246
4,485
-522
2,611
2,932
27
2
5,572
3,491
254
2,081
-145
131
90
-
-
144
101
97
216
-
1,741
1,290
754
6
3,790
1,791
122
1,999
-130
1,674
1,351
1,207
6
4,238
1,752
124
2,486
-392
104
95
62
100
89
102
98
80
33
74
1,328
1,419
-710
1
2,037
1,747
138
290
-233
523
131
91
-
-
186
103
88
-
56
5,605
5,732
1,489
2
12,828
6,966
504
5,861
-774
-
6,635
Profit before tax
5,006
2,226
225
2,129
2,877
Loans, excluding reverse trans. before impairments
of which loans in General Banking
Allowance account, loans (incl. credit institutions)
311,833 311,269
279,489 270,910
1,231
1,898
100 311,833 307,127
103 279,489 278,819
1,724
1,898
154
102 311,269
100 270,910
1,231
110
100 322,539
103 281,266
2,048
154
Deposits, excluding repo deposits
325,772 352,697
92 325,772 378,066
86 352,697
92 389,486
of which deposits in General Banking
Covered bonds issued
Allocated capital (average)
270,837 302,542
24,217
42,393
29,287
40,167
90 270,837 320,672
29,356
39,882
29,287
40,449
121
95
84 302,542
24,217
43,864
100
101
90 336,580
27,495
42,138
121
92
Net interest income as % p.a. of loans and deposits
1.02 0.80
-
1.06 0.97
-
0.80
-
0.81
Profit before loan impairment charges as % p.a. of al-
located capital
Profit before tax as % p.a. of allocated capital (avg.)
Cost/income ratio (%)
Full-time-equivalent staff
Total income
(DKK millions)
General Banking
Markets
of which xVA*
Asset Management
of which performance fees
Investment Banking & Securities (IBS)
22.3 9.8
24.9 10.5
44.1 62.7
-
-
-
19.8 24.9
21.1 28.9
47.3 41.3
-
-
-
2.6
4.8
85.8
-
-
-
13.9
15.7
54.3
2,103 2,097
100
2,103 2,079
101
2,097
100
2,054
4,154
2,362
-39
998
13
513
3,270
577
-99
1,151
86
574
127
-
39
87
15
89
2,099
945
-1
510
2
236
2,056
1,417
-38
488
12
277
102
67
3
105
17
85
1,645
-313
30
573
66
132
128
-
-
89
3
179
6,936
2,387
-48
2,313
174
1,193
Total income
8,028
5,572
144
3,790
4,238
89
2,037
186 12,828
*The xVA acronym covers Credit (CVA), Debit (DVA), Funding (FVA) and Collateral (ColVA) Valuation Adjustments to the fair value of the derivatives portfolio.
Danske Bank has a centralised xVA desk responsible for quantifying, managing and hedging xVA risks. The PnL result of the xVA desk is thus the combined
effect of the net xVA position and funding and collateral costs of the trading book.
Danske Bank / Interim report – first half 2023 24/88
Assets under management
(DKK millions)
Institutional clients*
Retail clients*
First half First half
2022
2023
Index
23/22
Q2
2023
Q1
2023
Index
Q2/Q1
Q2
2022
Index
23/22
Full year
2022
382,518 392,855
312,695 311,399
97 382,518 374,767
100 312,695 305,956
102 392,855
102 311,399
97 366,005
100 300,848
Total assets under management**
695,213 704,254
99 695,213 680,723
102 704,254
99 666,853
*Split of Assets under management between Institutional and Retail clients was adjusted in Q2 23, restating comparative information accordingly.
**Includes assets under management from Group entities.
Business initiatives
The volatility stemming
from central bank rate hikes
continued in the first half of 2023. Nonetheless, the overall
macroeconomic environment stabilised somewhat and
made capital markets more constructive during the second
quarter of 2023.
As a result, debt and equity capital markets started to see
improved conditions, and we are pleased to have helped our
customers capitalise on this opportunity, which resulted in
high activity in Debt Capital Markets. Among other things, we
acted as Joint Bookrunner on Storskogen’s SEK 2 billion
3.75y senior unsecured bond transaction, which is the
largest SEK high-yield corporate bond issue for the year to
date. Also, we maintained our leading position among Nordic
banks in the European debt capital markets in terms of
volumes supported.
In Equity Capital Markets, we were the leading ECM adviser
in Denmark during the first half of 2023 as we participated in
several transactions, such as supporting NKT in raising DKK
2,740 million to strengthen their capital base and Green
Hydrogen Systems in their growth journey with a DKK 719
million Rights Issue, which also demonstrated our ability to
support the sustainability agenda and the green transition in
the equity capital markets space.
In M&A advisory, activity remained relatively subdued across
the Nordic countries relative to same period last year. We
have, however, started
to see M&A opportunities
materialise. As an example, we provided advisory services in
relation to the S Bank acquisition of Handelsbanken Finland,
which, among other transactions, contributed to a top M&A
league table position in Finland.
While demand for advisory services increased, we supported
our customers
in transactions where many different
competencies were needed. For example, we teamed up with
and assisted Sobi in launching a bid for listed US company CTI
BioPharma. A complex transaction that involved Coverage,
Loan Capital Markets, Corporate Finance, Equity Capital
Markets and Foreign Exchange as well as various support
functions.
The more constructive capital markets also supported the
Nordic sustainable finance market, which saw record vol-
umes in the first and second quarters of the year. Thus, we
are pleased to have supported issuers and investors in a sub-
stantial number of transactions, ranging from Nordic locals
such as forestry company Sveaskog, for whom we structured
and arranged the world’s first EU taxonomy aligned green
bond in the forestry sector, to arrangement of an EUR 5.25
billion green bond for the Federal Republic of Germany and an
EUR 3 billion green bond for German development bank KfW.
As a result, we were ranked number 9 in Bloomberg’s Global
Green Bonds league table and arranged more green bonds
from European borrowers than any other arranger in the first
half of 2023. Also, we are proud to have maintained our posi-
tion as the leading Nordic arranger in the Bloomberg Sustain-
able Bond League table as well as to be the leading arranger
of sustainable bonds from Nordic borrowers in the first half
of 2023.
H1 2023 vs H1 2022
Profit before tax increased to DKK 5,006 million (H1 2022:
DKK 2,226 million) as a result of higher net trading income
and net interest income.
Net interest income increased to DKK 3,414 million (H1
2022: DKK 2,611 million) as a result of higher deposit mar-
gins. Lending volumes in General Banking increased 3% from
the level at the end of the first half of 2022, driven by both
new credit facilities and customers drawing more on existing
facilities. The high growth in lending volumes reflected not
only the volatile operating environment but also our strategic
ambition to grow our business in Sweden, and we are proud
that we already in the second quarter of 2023 reached the
ambition set in 2021 to have welcomed 40 new large corpo-
rate customers by 2023.
Net fee income declined to DKK 2,641 million (H1 2022:
DKK 2,932 million), with the decline caused primarily by
lower fees from assets under management and fees from ad-
visory services, despite better market conditions and im-
proved activity in the latter part of the second quarter. In-
come in Asset Management was lower than the level rec-
orded in the first half of 2022, mainly because of the lower
level of assets under management (AuM) at the beginning of
2023 that was the result of declining asset prices and nega-
tive net sales in the second half of 2022 as well as lower per-
formance fees. However, AuM increased through the first
half of 2023, partly on the back of recovering financial mar-
kets and a strong investment performance relative to both
peers and benchmark, which should also support future
sales. In addition, net sales were positive as a result of the
continually strong development in the institutional segment.
Net trading income increased to DKK 1,960 million (H1
2022: DKK 27 million) as we saw an improved result in our
Rates & Credit business in the first half of 2023. However,
the increase was also driven by our fixed income strategy im-
plemented towards the end of 2022, which resulted in more
stable income that was generated on the basis of continually
high customer activity and with very limited drawdowns de-
spite a challenging market environment.
Operating expenses increased somewhat and ended the pe-
riod at DKK 3,543 million (H1 2022: DKK 3,491 million). The
increase was the result of higher provisions for performance-
based compensation and higher IT costs, with the effect being
slightly offset by lower underlying costs. The number of full-
time equivalent staff was more or less stable at 2,103 (H1
2022: 2,097).
The overall credit quality of our portfolio remained strong in
the first half of 2023, with the general rating trend being sta-
ble. Loan
impairments amounted to a net reversal of
DKK 522 million (H1 2022: reversal of DKK 145 million),
driven by post-pandemic recoveries and successful restruc-
turing within the shipping, oil and gas sectors.
Credit exposure
Net credit exposure from lending activities amounted to
DKK 654 billion at the end of the first half of 2023 (end-
2022: DKK 648 billion). The small increase was due to expo-
sure increases in the Financials and Pharma and medical de-
vices industries, which were, however, offset by decreases in
the Utilities and infrastructure and Public institutions indus-
tries.
Danske Bank / Interim report – first half 2023 25/88
Q2 2023 vs Q1 2023
Profit before tax decreased to DKK 2,129 million (Q1 2023:
DKK 2,877 million), due primarily to lower trading income.
• Net interest income increased to DKK 1,741 million (Q1
2023: DKK 1,674 million), driven by an increase in
deposit margins, which was to a small extent offset by the
effect of lower deposit volumes and by the allocation from
Group Treasury to Large Corporates & Institutions of the
cost of hedging the interest rate risk related to deposits.
• Net fee income decreased and stood at DKK 1,290
million (Q1 2023: DKK 1,351 million), mainly as a result
of lower income from Debt Capital Markets advisory
services due to a strong first quarter, with the effect being
partly offset by an increase in assets under management.
• Net trading income decreased to DKK 754 million (Q1
2023: DKK 1,207 million) as market conditions were
more supportive in the first quarter. However, our
customer franchise continued to provide stable value,
although at a lower level than in the first quarter.
• Operating expenses increased to DKK 1,791 million (Q1
2023: DKK 1,752 million), driven primarily by higher
underlying costs and higher IT costs, with the effect being
to a small extent offset by lower performance-based
compensation.
• Loan impairment charges amounted to a net reversal of
DKK 130 million (Q1 2023: net reversal of DKK 392
million). Reversals in the second quarter were due to
continued post-pandemic recoveries and successful
restructuring within the shipping, oil and gas sectors.
DKK 2,129 million
Profit before tax
for the second quarter of 2023
Danske Bank / Interim report – first half 2023 26/88
Danica Pension
In the first half of 2023, the financial markets were overall more stable and positive than in the tumultuous 2022. However, the
optimistic start to the year was affected by instability in the global financial sector following a liquidity crisis among a number of US
and European banks. The financial markets have since stabilised, and this favoured our customers’ pension savings.
Net income in Danica Pension amounted to DKK 689 million in the first half of 2023 and recovered from the level in the same
period in 2022 as the net financial result improved due to the positive developments in the financial markets.
Danica Pension
(DKK millions)
Insurance service result
Net financial result
Other income
Net income before tax in Danica Pension
689
-103
Goodwill impairment
-
-
Net income from Danica Pension excl. Goodwill
689
-103
First half First half
2022
2023
Index
23/22
Q2
2023
Q1
2023
Index
Q2/Q1
Q2
2022
Index Full year
2022
23/22
435
242
13
705
-858
51
62
-
25
-
-
-
234
-47
5
192
201
289
7
497
-
-
192
497
116
-
71
39
-
39
361
-355
26
32
-
32
65
13
19
-
-
-
1,895
-1,679
-1,562
-1,347
1,627
280
Liabilities under insurance contracts
Liabilities under pooled unit-linked investment con-
tracts
Allocated capital (average)
500,555 687,928
73 500,555 497,090
101 687,928
73 507,146
20,850
19,552
18,566
21,083
112
93
20,850
19,586
20,604
19,518
101
100
18,566
20,264
112
97
20,469
20,326
Net income as % p.a. of allocated capital
Solvency coverage ratio
Full-time-equivalent staff
14.1
191
898
-2.0
184
957
-
-
-
3.9
191
898
10.2
180
902
-
-
-
0.6
184
957
-
-
-
-26.5
187
881
Asset under management
(DKK millions)
Insurance
418,185 415,018
101 418,185 412,906
101 415,018
101 403,789
Danica Pension has changed the format of reporting to align with IFRS 17, which was implemented on 1 January 2023. Business unit reporting for Danica
Pension has been changed accordingly, and comparative figures have been restated. See note G2 for more information.
Business initiatives
The first half of 2023 was generally characterised by opti-
mistic financial markets at the beginning of the year, yielding
strong, positive returns on customers’ pension savings. How-
ever, for a short period, uncertainty spread in the financial
sector following a liquidity crisis among a number of US and
European banks, which offset part of the positive returns. Fol-
lowing that period, markets stabilised, which resulted in
lower inflation and a continuation of the overall positive re-
turns in the first half of 2023. However, uncertainty regard-
ing a potential global recession put a slight damper on the up-
trend.
In June 2023, Danske Bank launched its new Forward ’28
strategy in which Danica Pension plays a role in ensuring that
customers enjoy the benefits offered by both the banking and
pension business units of the Group. The new strategy out-
lines how a customer can receive advice from a fully holistic
perspective, including housing, pension savings and invest-
ment of free assets. Some customers have relatively complex
finances, which is the reason why the strategy emphasises a
holistic yet also specialised approach to help establish more
profound customer relations across the business units.
H1 2023 vs H1 2022
Net income in Danica Pension amounted to DKK 689 million
(H1 2022: loss of DKK 103 million) due primarily to more
positive developments in the financial markets in 2023 than
in 2022.
The insurance service result decreased to DKK 435 million
(H1 2022: DKK 705 million) as Danica Pension saw a rise in
new health & accident claims, which, however, is a general
trend in society. Danica Pension was also not able to recog-
nise the full risk allowance in the first half of 2023, whereas
this was possible in the first half of 2022. The first half of
2022 also benefited from a reduction of technical provisions
related to the health & accident business.
The net financial result increased to DKK 242 million (H1
2022: loss of DKK 858 million). The increase was driven
mainly by positive investment results on insurance products
where Danica Pension has the investment risk and positive
investment returns on Danica Pension’s equity capital.
Assets under management increased DKK 3 billion from the
level at the end of June 2022, due mainly to the positive de-
velopment in the financial markets in the first half of 2023.
Premiums increased 9% from the same period in 2022 fol-
lowing an increase in both single and regular premiums due
to an inflow of new business customers.
Danske Bank / Interim report – first half 2023 27/88
Q2 2023 vs Q1 2023
Net income in Danica Pension decreased to DKK 192
million (Q1 2023: DKK 497 million). The insurance service
result increased from the first quarter 2023 result, while
the net financial result decreased.
•
•
increase of
The insurance service result saw an
DKK 33 million caused by a better insurance service
result on group life insurance products and an increase
in income from unit-linked insurance contracts, which
offset the effect of Danica Pension not being able to
recognise the full risk allowance.
The net financial result decreased in the second quarter
and amounted to a negative DKK 47 million (Q1 2023:
DKK 289 million) due to negative investment results on
insurance products where Danica Pension has the
investment risk. The negative investment results were
due mainly to the effect of the development in real estate
prices and in interest rates in the second quarter. The
investment returns on Danica Pension’s equity capital
also decreased in the second quarter of 2023.
•
Total premiums decreased 6% due to a decrease in
regular premiums as the first quarter of 2023 included
yearly regular premiums from group
life insurance
products.
• Assets under management increased DKK 5 billion due
to the positive developments in the financial markets in
the second quarter of 2023.
DKK 192 million
Net income in Danica Pension
for the second quarter of 2023
Danske Bank / Interim report – first half 2023 28/88
Northern Ireland
Our focus in Northern Ireland is on remaining a stable, strong and risk-astute bank, consolidating our market-leading position in
Northern Ireland alongside pursuing prudent low-cost growth opportunities in the rest of the UK. This is supported by a continually
strong income and profitability performance, with profit before tax of DKK 941 million in the first half of 2023.
First half First half
2022
2023
Index
23/22
Q2
2023
Q1
2023
Index
Q2/Q1
Q2
2022
Index Full year
2022
23/22
Northern Ireland
(DKK millions)
Net interest income
Net fee income
Net trading income
Other income
Total income
Operating expenses
Profit before loan impairment charges
Loan impairment charges
1,236
168
53
10
1,466
657
809
-131
823
164
-209
15
793
623
169
38
150
102
-
67
185
105
-
-
-
637
85
-61
5
665
338
327
-108
599
83
114
5
801
319
482
-24
435
506
Profit before tax
941
131
Loans, excluding reverse transactions before impair-
ments
Allowance account, loans
Deposits, excluding repo deposits
Allocated capital (average)*
57,064
742
98,700
6,105
58,313
711
99,977
6,063
98
104
99
101
57,064
742
98,700
6,376
55,435
818
94,667
5,831
Net interest income as % p.a. of loans and deposits
Profit before tax as % p.a. of allocated capital (avg.)
Cost/income ratio (%)
Full-time-equivalent staff
1.59
30.8
44.8
1,285
1.02
4.3
78.6
1,256
1.61
27.3
50.8
1,285
1.56
34.7
39.8
1,305
102
106
102
-
100
83
106
68
-
86
103
91
104
109
98
444
88
-66
12
477
315
162
19
143
58,313
711
99,977
6,020
1.09
9.5
66.0
1,256
143
97
92
42
139
107
202
-
-
98
104
99
106
102
1,900
335
-342
21
1,914
1,290
623
168
456
53,761
824
94,562
6,080
1.19
7.5
67.4
1,288
* Allocated capital equals the legal entity’s capital.
Business initiatives
The strategy in Northern Ireland aligns with Danske Bank’s
Forward ’28 strategy. In addition to advisory services, digiti-
sation and sustainability, our key focus also includes simplic-
ity and efficiency – all of which is underpinned by ensuring
high levels of employee engagement.
In the first half of 2023 we have introduced digital enhance-
ments that make it easier for personal customers to open
and operate savings accounts and that further improve the
customer journey for residential mortgages – alongside ex-
tending our mortgage product offering.
We are a local leader in the area of sustainability and have
seen increased demand from business customers who want
to take part in a climate action programme that we co-devel-
oped with Business in the Community. Last year, 55 of our
business customers went through the programme, and we
expect that 130 customers will have completed it by the end
of 2023.
We also continue to offer support to customers facing chal-
lenges as a result of continually high inflation and rising inter-
est rates.
H1 2023 vs H1 2022
Profit before tax increased to DKK 941 million (H1 2022:
loss of DKK 131 million), with actions taken in response to
higher UK interest rates and increased transactional activity
supporting a strong underlying income performance.
Net interest income increased to DKK 1,236 million (H1
2022: DKK 823 million), driven by actions taken in response
to higher UK interest rates, supported by modest lending
growth (in local currency). Moreover, deposits were broadly
unchanged year-on-year (in local currency), with high post-
pandemic balances maintained.
Net fee income amounted to DKK 168 million (H1 2022:
DKK 164 million), with strong underlying activity levels deliv-
ering year-on-year growth.
Net trading income reflects mark-to-market movements on
the bank’s hedging portfolio, given a combination of the expec-
tation for UK interest rates and the remaining life cycle of the
hedging instruments. With market expectations continuing
to fluctuate, trading income remains volatile. However, the
first-half and full-year 2022 performance saw much more
significant adverse mark-to-market movements than the per-
formance in the current half year.
Operating expenses stood at DKK 657 million (H1 2022:
DKK 623 million), up 5% year-on-year, and rose less than the
inflation rate due to the bank’s continued cost focus. Staff
numbers have reverted to more normal levels following
higher attrition and vacancy levels during 2022, and effi-
ciency priorities remain in focus.
Loan impairment charges remained low overall, amounting to
a net reversal in the first half of 2023. The macroeconomic
outlook improved marginally, and the loan portfolio remains
strong, driven by a conservative risk appetite and astute
handling of existing and new lending opportunities.
Danske Bank / Interim report – first half 2023 29/88
Q2 2023 vs Q1 2023
The second quarter of 2023 saw a profit before tax of
DKK 435 million (Q1 2023: DKK 506 million).
•
•
•
•
•
Net interest income increased to DKK 637 million (Q1
2023: DKK 599 million), reflecting pricing actions
taken in response to higher UK interest rates.
Net fee income of DKK 85 million (Q1 2023: DKK 83
million) as underlying activity levels remained strong.
Net trading income of a negative DKK 61 million (Q1
2023: DKK 114 million) reflected mark-to-market
movements on the hedging portfolio given ongoing
market volatility.
Operating expenses increased to DKK 338 million (Q1
2023: DKK 319 million), including an annual pay uplift
in the second quarter.
Loan impairment charges amounted to a net reversal
in the first half of 2023 and remain low overall.
DKK 435 million
Profit before tax
for the second quarter of 2023
Danske Bank / Interim report – first half 2023 30/88
Non-core
Non-core mainly comprises legacy credit exposures as well as non-strategic private equity investments. The winding up of the Non-
core activities is proceeding according to plan. Profit before tax in the first half of 2023 amounted to a loss of DKK 25 million,
against a profit of DKK 17 million in the first half of 2022.
First half First half
2022
2023
Index
23/22
Q2
2023
Q1
2023
Index
Q2/Q1
Q2
2022
Index Full year
2022
23/22
Non-core
(DKK millions)
Total income
Operating expenses
Profit before loan impairment charges
Loan impairment charges
Profit before tax
Loans, excluding reverse transactions before impair-
ments*
Allowance account, loans
Deposits, excluding repo deposits
Allocated capital (average)
-1
24
-25
-
-25
21
65
-44
-61
17
1,145
-
1,896
639
1,364
47
2,174
710
Net interest income as % p.a. of loans and deposits
Profit before tax as % p.a. of allocated capital (avg.)
Cost/income ratio (%)
Full-time-equivalent staff
-0.24
-7.8
-
12
-0.27
4.8
-
37
Loan impairment charges
(DKK millions)
Non-core banking*
Non-core conduits etc.
Total
-
-
-
-
-61
-61
-
37
57
-
-
84
-
87
90
32
-
-
-
16
12
4
-
5
-17
12
-29
-
-30
-
100
-
-
-
7
39
-32
-63
31
1,145
-
1,896
634
1,121
-
2,101
644
-0.24
3.2
-
12
-0.24
-18.6
-
14
102
-
90
98
1,364
47
2,174
683
-0.43
18.2
-
37
86
229
31
-
-
16
84
-
87
93
32
23
101
-78
-66
-13
1,207
39
2,112
668
-0.11
-1.9
-
25
-
-
-
-
-
-
-
-
-
-
-63
-63
-
-
-
-1
-64
-66
* Loans, excluding reverse transactions before impairments includes loans held for sale in the Baltics.
Initiatives
The Non-core unit focuses on actively managing down legacy
assets and portfolios by way of divestment, refinancing with
other credit institutions or amortisation.
The winding up of the remaining Non-core activities is pro-
ceeding according to plan. Residual portfolios in Luxembourg
and Lithuania have been fully exited, resulting in a steady de-
crease in operating expenses.
The closing of the subsidiary bank in Luxembourg is well un-
derway, and the voluntary solvent liquidation process is ex-
pected to be completed in the fourth quarter of 2023.
H1 2023 vs H1 2022
Profit before tax amounted to a loss of DKK 25 million (H1
2022: profit of DKK 17 million). The reduction in income and
expenses reflects the general progress made with the wind-
ing-up activities across Non-core.
At the end of June 2023, total lending showed yet another
decrease and stood at DKK 1.1 billion.
Q2 2023 vs Q1 2023
The Non-core unit posted a profit before tax of DKK 5 million
in the second quarter of 2023 (Q1 2023: loss of DKK 30
million).
•
•
•
Total income amounted to DKK 16 million (Q1 2023:
loss of DKK 17 million). Total income in the second
quarter of 2023 consisted of miscellaneous income
items relating to the non-strategic portfolio, while the
negative income in the first quarter was due mainly to
value adjustments of the non-strategic portfolio.
Operating expenses amounted to DKK 12 million (Q1
2023: DKK 12 million).
Total lending was unchanged at DKK 1.1 billion (Q1
2023: DKK 1.1 billion).
DKK 5 million
Profit before tax
for the second quarter of 2023
Danske Bank / Interim report – first half 2023 31/88
Group Functions
Group Functions includes Group Treasury, Technology & Services and other Group functions. In addition, Group Functions includes
eliminations.
In the first half of 2023, the loss before tax increased to DKK 2,217 million from a loss of DKK 921 million in the first half of 2022
due to an increase in the cost of hedging the interest rate risk related to deposits at Group Treasury, although the effect was partly
offset by the sale of shares taken over in connection with a loan. The successful sale resulted in a gain of DKK 327 million.
First half First half
2022
2023
Index
23/22
Q2
2023
Q1
2023
Index
Q2/Q1
Q2
2022
Index Full year
2022
23/22
Group Functions
(DKK millions)
Net interest income
Net fee income
Net trading income
Other income
Total income
Operating expenses
of which resolution fund, bank tax etc.
of which impairment charges, other intangible assets
Provision for Estonia matter
-991
-31
327
-15
-710
1,502
38
-
-
-19
-20
40
4
5
916
43
24
-
Profit before loan impairment charges
Loan impairment charges
-2,212
5
-912
10
-
155
-
-
-
164
88
-
-
243
50
-409
-24
243
-21
-211
792
12
-
-
-582
-8
84
7
-499
710
26
-
-
-1,002
4
-1,209
1
70
300
289
-
42
112
46
-
-
83
-
83
-38
6
164
2
133
478
17
24
-
-
-
148
-
-
166
71
-
-
-350
-32
-232
78
-536
2,762
74
24
13,800
-345
-7
290
-
-17,098
669
-337
299
-17,767
Profit before tax
-2,217
-921
241
-1,006
-1,210
Full-time-equivalen t staff
11,077
10,746
103
11,077
10,965
101
10,746
103
10,878
Profit before tax
(DKK millions)
Group Treasury
Own shares and issues
Additional tier 1 capital
Group support functions
Total Group Functions
-563
1
-1
-1,654
-126
99
86
-980
-
1
-
169
22
-97
-1
-930
-585
98
-
-724
-
-
-
128
-25
138
5
-455
-
-
-
204
-933
71
89
-16,993
-2,217
-921
241
-1,006
-1,210
83
-337
299
-17,767
Comparative information for Group Functions has been restated as explained in note G2.
Business initiatives
Group Functions supports the business units by allocating
capital, interest-bearing capital and long-term funding costs
through the Group Treasury setup that is established to han-
dle, for example, the pricing of funding. Group Treasury also
manages the Group’s liquidity bond portfolio and the invest-
ment of shareholders’ equity for Danica Pension and
Realkredit Danmark. Operating expenses related to the sub-
units within Group Functions are allocated to the business
units. This is done to ensure cost efficiency throughout the
Group.
H1 2023 vs H1 2022
Group Functions posted a loss before tax of DKK 2,217 mil-
lion (H1 2022: loss of DKK 921 million).
Net interest income decreased to a net expense of DKK 991
million (H1 2022: net expense of DKK 19 million) due primar-
ily to an increase in the cost of hedging the interest rate risk
related to deposits, which from 2023 is being accounted for
as net interest income instead of as net trading income. From
May 2023, these costs were allocated to the business units.
Net trading income increased to DKK 327 million (H1 2022:
DKK 40 million) due to the sale of shares taken over in con-
nection with a loan. The successful sale resulted in a gain of
DKK 327 million.
Operating expenses, after allocation to the business units, in-
creased from the level in the first half of 2022 and amounted
to DKK 1,502 million (H1 2022: DKK 916 million), mainly as
a result of increased salary costs driven by salary increases
and a higher number of FTEs combined with a lower alloca-
tion of costs to the business units.
Loan impairment charges amounted to DKK 5 million (H1
2022: DKK 10 million).
The number of full-time-equivalent staff increased 3% to
11,077.
Danske Bank / Interim report – first half 2023 32/88
Q2 2023 vs Q1 2023
Group Functions posted a loss before tax of DKK 1,006 mil-
lion (Q1 2023: loss of DKK 1,210 million). Total income im-
proved due a lower net interest expense in Group Treasury
and to the sale of shares taken over in connection with a
loan. The successful sale resulted in a gain of DKK 327 mil-
lion.
•
•
•
•
Net interest income improved to a net expense of
DKK 409 million (Q1 2023: net expense of DKK 582
million) due primarily to increased allocation from
Group Treasury to the business unites of the cost of
hedging the interest rate risk related to deposits.
Net trading income increased to DKK 243 million (Q1
2023: DKK 84 million) due mainly to the sale of shares
taken over in connection with a loan. The successful
sale resulted in a gain of DKK 327 million.
Operating expenses, after allocation to the business
units, amounted to DKK 792 million (Q1 2023:
DKK 710 million).
Loan impairment charges amounted to DKK 4 million
(Q1 2023: DKK 1 million).
DKK -1,006 million
Profit before tax
for the second quarter of 2023
Danske Bank / Interim report – first half 2023 33/88
Definition of alternative performance measures
Danske Bank’s management believes that the alternative performance measures (APMs) used in the Management’s report provide valuable information to readers of
the financial statements. The APMs provide a more consistent basis for comparing the results of financial periods and for assessing the performance of the Group and
each individual business unit. They are also an important aspect of the way in which Danske Bank’s management defines operating targets and monitors performance.
Throughout the Management’s report, performance is assessed on the basis of the financial highlights and segment reporting, which represent the financial information
regularly provided to management. The differences between the financial highlights and the IFRS financial statements relate to certain changes in the presentation. Net
profit is the same in the financial highlights and in the IFRS income statement. Notes G1 and G3 to the financial statements describe the differences between the financial
highlights and the IFRS financial statements, and each line item in the financial highlights is reconciled with the consolidated financial statements prepared under IFRS.
Definitions of additional ratios presented on page 3 and in other sections of the Management’s report:
Ratios and key figures
Dividend per share (DKK)
Definition
The dividend per share proposed in the annual report and paid to shareholders in the subsequent year, and any
interim dividends that are approved during the year by the Board of Directors.
Return on average shareholders’ equity (% p.a.)
Net profit as disclosed in the financial highlights divided by the average of the quarterly average shareholders’
equity (beginning and end of each quarter) within the year. Net profit and shareholders’ equity are stated as if the
equity-accounted additional tier 1 capital was classified as a liability. In the numerator, net profit is reduced by
interest expenses of DKK 0 million (full-year 2022: DKK 86 million). The denominator represents equity, exclud-
ing additional tier 1 capital and other non-controlling interests equal to an increase in the average of the quarterly
average equity of DKK 56 million (2022: reduction of 2,340 million) compared to a simple average of total equity
(beginning and end of the period).
Adjusted return on average shareholders’ equity (%
p.a.)
Net profit, excluding the provision for the Estonia matter and the goodwill impairment charge, divided by the av-
erage of the quarterly average shareholders’ equity (beginning and end of each quarter) within the year. The nu-
merator and denominator are adjusted as per Return on average shareholders’ equity above.
Net interest income as % p.a. of loans and deposits
Cost/income ratio (C/I), (%)
Net interest income in the financial highlights divided by the daily average of the sum of loans and deposits. If the
ratio was calculated applying the sum of loans and deposits at the end of the period, the ratio for 2023 would be
1.16% (2022: 0.84%) due to the daily average of the sum of loans and deposits being DKK 71.3 billion higher
(2022: DKK 39.9 billion higher) than if calculating the ratio by applying the end-of-period sum of loans and de-
posits. The purpose of the ratio is to show whether the growth in net interest income follows the growth in loans
and deposits. The daily average is a more faithful representation of the growth in loans and deposits.
Operating expenses and provision for Estonia matter and impairment charges on goodwill divided by total in-
come. All amounts are from the financial highlights.
Adjusted cost/income ratio (%)
Operating expenses divided by total income. All amounts are from the financial highlights.
Book value per share
Shareholders’ equity (that is, excluding equity-accounted additional tier 1 capital) divided by the number of shares
outstanding at the end of the period.
Loan impairment charges as % of net credit exposure
This ratio is calculated on the basis of loan impairment charges and loans and guarantees in core segments. The
Allowance account as % of net credit exposure
numerator is the loan impairment charges of DKK -28 million (2022: DKK 1,568 million) from the financial high-
lights annualised. The denominator is the sum of Loans at amortised cost of DKK 1,081.7 billion (2022:
DKK 1,026.1 billion), Loans at fair value of DKK 724.1 billion (2022: DKK 809.9 billion) and guarantees of
DKK 81.4 billion (2022: DKK 81.0 billion) at the beginning of the year, as disclosed in the column “Lending activ-
ities – core” in the “Breakdown of credit exposure” table in the notes to the financial statements. The ratio is
calculated for each business unit.
This ratio is calculated on the basis of the allowance account and loans and guarantees in core segments. The
numerator is the allowance account of DKK 19.4 billion (2022: DKK 19.6 billion) at the end of the period, as
disclosed in the “Allowance account in core activities broken down by segment” table in the notes to the financial
statements. The denominator is the sum of Loans at amortised cost of DKK 909.3 billion (2022: DKK 1,081.7
billion), Loans at fair value of DKK 725.0 billion (2022: DKK 724.1 billion) and guarantees of DKK 80.9 billion
(2022: DKK 81.4 billion) at the end of the period, as disclosed in the column “Lending activities – core” in the
“Breakdown of credit exposure” table in the notes to the financial statements. The ratio is calculated for each
business unit.
Market shares of lending and deposits
Market shares are based on data from central banks at the time of reporting. Comparative information is updated
on the basis of the latest available data, for example Annual Report 2022 included November 2022 data for
Finland and Norway as December 2022 data was not available at the time of publication of Annual Report 2022.
This was subsequently updated to December 2022 data in Interim report – first half 2023.
Danske Bank / Interim report – first half 2023 34/88
Income statement – Dans ke Bank Group
Statement of comprehensive income – Danske Bank Group
Balance sheet – Da nske Bank Group
Statement of capital – Danske Ba nk Group
Cash flow statement – Danske Bank Group
Notes
35
36
37
38
40
41
Note G1: Significant accounting policies and estimates
Note G2: Changes in accounting policies,
43
financial highlights and segment reporting
48
Note G3: Business segments
Note G4: Income
51
Note G5: Loan impairment charges and reconciliation of total allowance account 52
53
Note G6: Insurance service result and other insurance income
54
Note G7: Issued bonds, subordinated debt and additional tier 1 capital
55
Note G8: Assets held for sale and Liabilities in disposal groups held for sale
55
Note G9: Other assets a nd Other liabilities
56
Note G10: Foreign currency translation reserve
57
Note G11: Guarantees, commitments and contingent liabilities
59
Note G12: Assets provided or received as collateral
60
Note G13: Fair value information for financial instruments
64
Note G14: Risk manage ment notes
64
Breakdown of credit exposure
65
Credit exposure from core lending activities
75
Credit exposure from Non-core lending activities
Counterparty credit risk & credit exposure from trading and investment securities 76
76
Bond portfolio
Financial statements – Danske Bank A/S
79
Income statement – Danske Bank Group
Danske Bank / Interim report – first quarter 2023 35/88
Note
(DKK millions)
G4
G4
G4
Interest income calculated using the effective interest method**
Other interest income**
Interest expense
G4
G4
G4
Net interest income
Fee income
Fee expenses
Net trading income or loss
Gain or loss on sale of disposal groups
Other income
Insurance service result and other insurance income
Net return on investments backing insurance liabilities
Net finance income or expense from insurance
Operating expenses
G9,G11 Provision for Estonia matter
G4
G6
Impairment charges on goodwill
G5
Profit before loan impairment charges
Loan impairment charges
Profit before tax
Tax
Net profit
Portion attributable to
Shareholders of Danske Bank A/S (the Parent Company)
Additional Tier 1 capital holders
Net profit
Earnings per share (DKK)
Diluted earnings per share (DKK)
First half
2023
First half
2022*
32,216
8,694
26,315
14,595
7,735
2,063
4,775
-693
2,236
447
13,026
-12,784
14,329
-
-
12,944
-28
12,972
2,794
12,510
9,246
9,330
12,426
9,052
2,531
-711
836
2,417
756
-58,421
57,147
14,726
-
-
6,246
365
5,881
1,343
Q2
2023
17,153
3,591
13,883
6,861
3,890
1,179
2,865
-693
1,052
-49
13,026
-12,784
7,146
-
-
5,842
-175
6,018
1,007
Q2
2022*
6,488
5,721
4,986
7,223
4,390
1,268
-1,768
421
1,197
388
-34,670
33,899
7,369
-
-
2,442
129
2,313
516
Full year
2022*
31,697
18,288
24,634
25,351
17,305
4,824
1,581
1,420
4,785
2,235
-60,302
57,932
30,251
13,800
1,627
-195
1,502
-1,697
2,883
10,178
4,538
5,011
1,796
-4,580
10,178
-
10,178
11.9
11.8
4,452
86
4,538
5.2
5.2
5,011
-
5,011
5.8
5.8
1,791
5
-4,666
86
1,796
-4,580
2.1
2.1
-5.4
-5.4
* Comparative information has been restated, as described in note G2(a).
** Q2 2023 is affected by adjustments made for Q1 2023 between Interest income calculated using the effective interest method and Other interest income.
Danske Bank / Interim report – first half 2023 36/88
Statement of comprehensive income – Danske Bank Group
(DKK millions)
Net profit
Other comprehensive income
Remeasurement of defined benefit pension plans
Tax*
Items that will not be reclassified to profit or loss
Items that are or may be reclassified subsequently to profit or loss
Translation of units outside Denmark
Hedging of units outside Denmark
Unrealised value adjustments of bonds at fair value (OCI)
Realised value adjustments of bonds at fair value (OCI)
Tax*
First half
2023
First half
2022**
Q2
2023
Q2
2022**
Full year
2022**
10,178
4,538
5,011
1,796
-4,580
-115
-16
-99
-4,533
2,260
-60
-14
-539
-426
-77
-349
-2,613
1,424
-1,323
19
-484
-131
-36
-96
-2,159
1,097
-184
-15
-295
-496
-96
-400
-2,973
1,563
-703
7
-393
-968
-179
-789
-4,481
2,463
-1,546
-14
-674
Items that are or may be reclassified subsequently to profit or loss
-1,808
-2,009
-966
-1,713
-2,904
Total other comprehensive income
Total comprehensive income
-1,906
-2,358
-1,062
-2,113
-3,693
8,271
2,180
3,949
-316
-8,273
Portion attributable to
Shareholders of Danske Bank A/S (the Parent Company)
Additional Tier 1 capital holders
Total comprehensive income
* A positive amount is a tax expense, and a negative amount is a tax income
** Comparative information has been restated, as described in note G2(a).
8,271
-
2,094
86
3,949
-
8,271
2,180
3,949
-321
5
-316
-8,359
86
-8,273
Danske Bank / Interim report – first half 2023 37/88
30 June
2023
31 December
2022*
30 June
2022*
231,516
105,155
559,305
288,277
910,422
903,801
67,820
502,546
120,665
6,093
3,904
32,104
175,052
60,786
638,799
287,423
1,082,818
932,677
66,739
502,995
350
6,045
5,199
31,673
209,680
115,940
661,286
287,254
1,083,740
944,084
66,221
701,140
250
7,997
5,401
29,308
Balance sheet – Danske Bank Group
Note
(DKK millions)
Assets
Cash in hand and demand deposits with central banks
Due from credit institutions and central banks
Trading portfolio assets
Investment securities
Loans at amortised cost
Loans at fair value
Assets under pooled schemes and unit-linked investment contracts
Assets under insurance contracts
Assets held for sale
Intangible assets
Tax assets
Other assets
G8
G9
G7
G7
G8
G9
G7
G7
G10
Total assets
3,731,608
3,790,556
4,112,301
Liabilities
Due to credit institutions and central banks
Trading portfolio liabilities
Deposits
Issued bonds at fair value
Issued bonds at amortised cost
Deposits under pooled schemes and unit-linked investment contracts
Liabilities under insurance contracts
Liabilities in disposal groups held for sale
Tax liabilities
Other liabilities
Non-preferred senior bonds
Subordinated debt
Total liabilities
Equity
Share capital
Foreign currency translation reserve
Reserve for bonds at fair value (OCI)
Retained earnings
Total equity
Total liabilities and equity
* Comparative information has been restated, as described in note G2(a).
186,661
480,024
1,184,882
722,204
205,314
68,428
486,606
32,949
2,074
62,369
93,113
38,338
138,777
554,321
1,262,293
723,923
192,682
66,725
488,891
-
2,103
68,978
93,235
38,350
168,493
590,251
1,309,329
742,327
194,162
66,660
661,884
-
2,190
60,261
106,467
39,503
3,562,960
3,630,278
3,941,526
8,622
-4,903
-1,600
166,529
168,648
8,622
-2,630
-1,526
155,812
160,278
8,622
-1,801
-1,270
165,224
170,775
3,731,608
3,790,556
4,112,301
Danske Bank / Interim report – first half 2023 38/88
Statement of capital – Danske Bank Group
Changes in equity
Shareholders of Danske Bank A/S (the Parent Company)
(DKK millions)
Total equity as at 1 January 2023
Effect of changes in accounting policy*
Restated total equity as at 1 January 2023
Net profit
Other comprehensive income
Remeasurement of defined benefit pension plans
Translation of units outside Denmark
Hedging of units outside Denmark
Unrealised value adjustments
Realised value adjustments
Tax
Total other comprehensive income
Total comprehensive income
Transactions with owners
Acquisition of own shares and additional tier 1 capital
Sale of own shares and additional tier 1 capital
Share
capital
8,622
-
8,622
-
-
-
-
-
-
-
-
-
-
-
Foreign
currency
translation
reserve
Reserve for
bonds at fair
value (OCI)
Retained
earnings
Proposed
dividends
Additional
tier 1 capital
Total
Total
-2,630
-
-2,630
-
-
-4,533
2,260
-
-
-
-2,273
-2,273
-1,526 155,852
-40
-
-1,526 155,812
10,178
-
-
-
-
-60
-14
-
-74
-115
-
-
-
-
555
441
-74
10,618
-
-
-
-
-13,390
13,489
- 160,318
-40
-
- 160,278
10,178
-
-
-
-
-
-
-
-
-
-
-
-115
-4,533
2,260
-60
-14
555
-1,906
8,271
-13,390
13,489
- 160,318
-40
-
- 160,278
10,178
-
-
-
-
-
-
-
-
-
-
-
-115
-4,533
2,260
-60
-14
555
-1,906
8,271
-13,390
13,489
Total equity as at 30 June 2023
8,622
-4,903
-1,600 166,529
- 168,648
- 168,648
Total equity as at 1 January 2022
Effect of changes in accounting policy*
Restated total equity as at 1 January 2022
Net profit
Other comprehensive income
Remeasurement of defined benefit pension plans
Translation of units outside Denmark
Hedging of units outside Denmark
Unrealised value adjustments
Realised value adjustments
Tax
Total other comprehensive income
Total comprehensive income
Transactions with owners
Paid interest on additional tier 1 capital
Dividends paid
Redemption of additional tier 1 capital
Acquisition of own shares and additional tier 1 capital
Sale of own shares and additional tier 1 capital
Tax
8,622
-
8,622
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-612
-
-612
-
-
-2,613
1,424
-
-
-
34 161,439
-707
-
1,724 171,207
-707
-
5,497 176,704
-707
-
34 160,732
4,452
-
1,724 170,500
4,452
-
5,497 175,997
4,538
86
-
-
-
-1,323
19
-
-426
-
-
-
-
561
-1,189
-1,304
135
-1,189
-1,304
4,587
-
-
-
-
-
-
-
-
-426
-2,613
1,424
-1,323
19
561
-2,358
-
-
-
-
-
-
-
-426
-2,613
1,424
-1,323
19
561
-2,358
2,094
86
2,180
-
-
-
-
-
-
-
-
-
-
-
-
-
19
-
-10,321
10,221
-15
-
-1,724
-
-
-
-
-
-1,705
-
-10,321
10,221
-15
-164
-
-5,419
-
-
-
-164
-1,705
-5,419
-10,321
10,221
-15
Total equity as at 30 June 2022
8,622
-1,801
-1,270 165,224
- 170,775
- 170,775
* See note G2(a) for details on changes in accounting policy.
Dividend
Based on our strong performance in the first half year of 2023 and our strong capital position at the end of the period, the Board of Directors has on the
approval of the half-year report approved an interim dividend of DKK 7 per share, corresponding to 59% of net profit for the period.
Statement of capital – Danske Bank Group
(DKK millions)
Share capital (DKK)
Number of shares
Number of shares outstanding
Average number of shares outstanding for the period
Average number of shares outstanding, including dilutive shares, for the period
* Comparative information has been restated, as described in note G2(a).
Total capital and total capital ratio
(DKK millions)
Total equity
Revaluation of domicile property at fair value
Tax effect of revaluation of domicile property at fair value
Total equity calculated in accordance with the rules of the Danish FSA
Common equity tier 1 capital instruments
Adjustment to eligible capital instruments
IFRS 9 reversal due to transitional rules
Prudent valuation
Prudential filters
Expected/proposed dividends
Intangible assets of banking operations
Minimum Loss Coverage for Non-Performing Exposures
Deferred tax on intangible assets
Deferred tax assets that rely on future profitability, excluding temporary differences
Defined benefit pension plan assets
Statutory deduction for insurance subsidiaries
Common equity tier 1 capital
Additional tier 1 capital instruments
Tier 1 capital
Tier 2 capital instruments
Total capital
Total risk exposure amount
Common equity tier 1 capital ratio (%)
Tier 1 capital ratio (%)
Total capital ratio (%)
Danske Bank / Interim report – first half 2023 39/88
30 June
2023
31 December
2022*
8,621,846,210
862,184,621
858,778,466
858,581,349
859,871,059
8,621,846,210
862,184,621
858,392,752
858,331,842
859,511,104
30 June
2023
168,648
216
-28
31 December
2022*
160,318
217
-28
168,835
160,506
168,835
-532
1,738
-1,281
-450
-6,107
-5,765
-1,057
336
-340
-1,439
-4,555
149,385
15,090
164,474
20,751
160,506
-222
3,063
-1,338
-567
-
-5,529
-500
242
-352
-1,424
-4,683
149,197
15,300
164,497
20,765
185,225
185,261
825,516
838,193
18.1%
19.9%
22.4%
17.8%
19.6%
22.1%
* Comparative information has not been restated. See note G2(a) for more detail.
Total capital and the total risk exposure amount are calculated in accordance with the rules applicable under the Capital Requirements Regulation (CRR),
taking transitional rules into account as stipulated by the Danish Financial Supervisory Authority.
In terms of the transitional arrangements for the impact of IFRS 9 on regulatory capital, the Group applies the so-called dynamic approach in accordance
with the CRR.
The Internal Capital Adequacy Assessment Report provides more details about the Group’s solvency need. The report is available at danskebank.com/in -
vestorrelations/reports.
Cash flow statement – Danske Bank Group
(DKK millions)
Cash flow from operations
Profit before tax
Tax paid
Adjustment for non-cash operating items
Danske Bank / Interim report – first half 2023 40/88
First half
2023
First half
2022*
Full Year
2022*
12,972
-1,481
3,643
5,881
-3,147
659
-1,697
-3,025
21,459
Cash flow from operations before changes in operating capital
15,134
3,393
16,737
Changes in operating capital
Amounts due to/from credit institutions and central banks
Trading portfolio
Acquisition/sale of own shares and additional tier 1 capital
Investment securities
Loans at amortised cost and fair value
Deposits
Issued bonds at amortised cost and fair value
Assets/liabilities under insurance contracts
Other assets/liabilities
Cash flow from operations
Cash flow from investing activities
Sale of businesses
Acquisition of intangible assets
Acquisition of tangible assets
Sale of tangible assets
Cash flow from investing activities
Cash flow from financing activities
Issue of non-preferred senior bonds
Redemption of non-preferred senior bonds
Dividends paid
Redemption of equity accounted additional tier 1 capital
Paid interest on equity accounted additional tier 1 capital
Principal portion of lessee lease payments
Cash flow from financing activities
Cash and cash equivalents as at 1 January
Foreign currency translation
Change in cash and cash equivalents
Cash and cash equivalents, end of period
Cash and cash equivalents, end of period
Cash in hand
Demand deposits with central banks
Amounts due from credit institutions and central banks within three months
Total
* Comparative information has been restated, as described in note G2(a).
46,432
5,196
99
-854
80,940
-44,462
8,461
-1,837
-11,806
-6,649
63,431
-100
-6,312
23,714
17,299
-127,502
-8,505
8,622
-35,969
49,989
-249
-6,481
34,905
-29,737
-150,465
16,156
-4,243
97,303
-32,609
-109,357
-
-299
-451
5
-745
16,101
-13,773
-
-
-
-296
1,314
-563
-179
2
574
20,052
-20,438
-1,705
-5,419
-164
-312
2,032
-560
-826
4
650
20,052
-30,590
-1,705
-5,419
-164
-611
2,032
-7,986
-18,437
232,531
791
98,590
362,997
-1,060
-40,021
362,997
-3,322
-127,144
331,912
321,916
232,531
6,865
224,651
100,396
6,670
203,010
112,236
6,630
168,422
57,479
331,912
321,916
232,531
Danske Bank / Interim report – first half 2023 41/88
Notes – Danske Bank Group
G1. Significant accounting policies and estimates
(a) General
The report has been prepared in accordance with IAS 34, Interim Financial Reporting, as adopted by the EU, and additional Danish disclosure require-
ments for listed financial companies. The report is condensed and should be read in conjunction with the Group’s Annual Report 2022.
On 1 January 2023, the Group implemented a new standard, IFRS 17, and the amendments to IAS 1, IAS 8 and IAS 12. Further information on the
changes to accounting policies and presentation in 2023 can be found in note G2(a). Except for these changes, the Group has not changed its signifi-
cant accounting policies from those applied in Annual Report 2022. Annual Report 2022 provides a full description of the significant accounting poli-
cies.
Financial statement figures are stated in Danish kroner and whole millions, unless otherwise stated. As a result, rounding discrepancies may occur
because totals have been rounded off and the underlying decimals are not presented to financial statement users.
(b) Significant accounting estimates and judgements
The preparation of financial information requires, in some cases, the use of judgements and estimates by management. This includes judgements made
when applying accounting policies. The most significant judgements made when applying accounting policies relate to the classification of financial
assets and financial liabilities under IFRS 9, especially related to the business model assessment, and the SPPI test (further explained in note G15 of
the Annual Report 2022) and the designation of financial liabilities at fair value through profit or loss to eliminate or significantly reduce an accounting
mismatch (further explained in note G16 of the Annual Report 2022). An overview of the classification and measurement basis for financial instru-
ments can be found in note G1(c) of the Annual Report 2022.
The determination of the carrying amounts of some assets and liabilities requires the estimation of the effects of uncertain future events on those assets
and liabilities. The estimates are based on premises that management finds reasonable but which are inherently uncertain and unpredictable. The prem-
ises may be incomplete, unexpected future events or situations may occur, and other parties may arrive at other estimated values. In view of the inheren t
uncertainties and the high level of subjectivity and judgement involved in the recognition and measurement of the items listed below, it is possible that
the outcomes in the next reporting period could differ from those on which management’s estimates are based.
Measurement of expected credit losses on loans, financial guarantees and loan commitments, and bonds measured at amortised cost or fair value
through other comprehensive income
The three-stage expected credit loss impairment model in IFRS 9 depends on whether the credit risk has increased significantly since initial recogni-
tion. If the credit risk has not increased significantly, the impairment charge equals the expected credit losses resulting from default events that are
possible within the next 12 months (stage 1). If the credit risk has increased significantly, the loan is more than 30 days past due, or the loan is in de-
fault or otherwise impaired, the impairment charge equals the lifetime expected credit losses (stages 2 and 3). In determining the impairment for ex-
pected credit losses, management exercises judgement and uses estimates and assumptions as explained below.
The expected credit losses are calculated for all individual facilities as a function of probability of default (PD), exposure at default (EAD) and loss given
default (LGD) and incorporate forward-looking information. The estimation of expected credit losses involves forecasting future economic conditions
over a number of years. Such forecasts are subject to management judgement and those judgements may be sources of measurement uncertainty that
have significant risk of resulting in a material adjustment to a carrying amount in future periods. The incorporation of forward-looking elements reflects
the expectations of the Group’s senior management and involves the creation of scenarios (base case, upside and downside), including an assessment
of the probability for each scenario. The purpose of using multiple scenarios is to model the non-linear impact of assumptions about macroeconomic
factors on the expected credit losses. Note G14 provides information on the scenarios as at 30 June 2023.
Management applies judgement when determining the need for post-model adjustments. As at 30 June 2023, the post-model adjustments amounted
to DKK 6.8 billion (31 December 2022: DKK 6.6 billion) which are predominantly linked to macroeconomic uncertainties related to inflation and in-
creasing interest rates, and other sector-specific factors that ensure prudent coverage of expected credit losses for the Group’s credit exposures. On
the types of risks covered by post-model adjustments, more information can be found in note G14.
Note G15 of the Annual Report 2022 and the section on credit risk in note G14 in the Interim report – first half 2023 provide more details on expected
credit losses. As at 30 June 2023, financial assets covered by the expected credit loss model accounted for about 54.9% of total assets (31 December
2022: 55.7%).
Danske Bank / Interim report – first half 2023 42/88
Notes – Danske Bank Group
G1. Significant accounting policies and estimates continued
(b) Significant accounting estimates continued
Fair value measurement of financial instruments
At the end of June 2023, no unusual challenges in obtaining reliable pricing apart from insignificant parts of the portfolio remained. The majority of
valuation techniques continues to employ only observable market data, and there has been no significant increase in financial instruments measured
on the basis of valuation techniques that are based on one or more significant unobservable inputs. The latter continues to include only unlisted shares,
certain bonds and some long-dated derivatives for which there is no active market. On the derivatives portfolio, the Group makes fair value adjustments
to cover changes in counterparty risk (CVA and DVA) and to cover expected funding costs (FVA and ColVA) on derivatives, bid-offer spreads on the net
open position of the portfolio of assets and liabilities with offsetting market risk recognised at mid-market prices, and model risk on level 3 derivatives.
As at 30 June 2023, the adjustments totalled DKK 0.1 billion (31 December 2022: DKK 0.2 billion), including the adjustment for credit risk on deriva-
tives that are credit impaired. Note G13 of this report and note G33(a) of the Annual Report 2022 provides more details on the fair value measure-
ment of financial instruments.
The Group uses derivatives to hedge the fixed interest rate on some financial assets and liabilities, thus converting the fixed interest rates on the financia l
instruments to variable interest rates by the use of swaps. The ongoing Interest Rate Benchmark Reform, with focus on replacing existing benchmar k
interbank offered rates (IBORs) with alternative risk-free rates, reached a major goal on 30 June 2023 with the cessation of USD LIBOR. As at 30 June
2023, the Group completed the transition of all legacy USD LIBOR contracts to the new regulatory approved reference rates. The Group continues to
monitor this area of regulation to ensure continued compliance, including the potential need for similar cessation / transition work in the future. Following
IASB’s project ‘Interest Rate Benchmark Reform’ for the assessment of effectiveness of such hedges, it is assumed that the interest rate benchmark is
not altered as a result of the reform. For further information, see note G12(d) of the Annual Report 2022.
Measurement of goodwill
Goodwill is tested for impairment once a year or more frequently if indications of impairment exist. Impairment testing requires management to esti-
mate the present value of future cash flows. A number of factors affect the value of such cash flows, including discount rates, changes in the economic
outlook, customer behaviour and competition. At 30 June 2023, goodwill amounted to DKK 4.4 billion (31 December 2022: DKK 4.4 billion).
In connection with the quarterly reporting, management performs an impairment review to assess whether there are indications that goodwill might be
impaired. This includes a review of decline in income, increase in loan impairment charges, decline in the market value of assets under management,
major restructurings, macroeconomic developments etc. No indications of impairment have been noted at the end of June 2023.
Goodwill mainly consists of DKK 2.1 billion (31 December 2022: DKK 2.1 billion) in Markets, DKK 1.8 billion (31 December 2022: DKK 1.8 billion) in
Asset Management and DKK 0.5 billion (31 December 2022: DKK 0.5 billion) in General Banking (all part of the business segment Large Corporates &
Institutions) showing significant amounts of excess value in the impairment tests in 2022.
Note G19 of the Annual Report 2022 provides more information about impairment testing and sensitivity to changes in assumptions.
Measurement of liabilities under insurance contracts
Liabilities under insurance contracts are measured using either the General Measurement Model (GMM), Variable Fee Approach (VFA) or Premium
Allocation Approach (PAA). GMM and VFA both comprise fulfilment cash flows, which are estimates of the present value of future cash flows for insur-
ance contracts, adjusted for time value of money and financial risks related to future cash flows, and a risk adjustment for non-financial risk. Such esti-
mates include actuarial computations, that rely on a number of variables, including mortality and disability rates, as well as discount rates. Note G2
provides more information on the measurement of insurance liabilities.
Danske Bank / Interim report – first half 2023 43/88
Notes – Danske Bank Group
G2. Changes in accounting policies, financial highlights and segment reporting
(a) Changes in accounting policies
On 1 January 2023, the Group implemented IFRS 17, and the amendments to IAS 1, IAS 8 and IAS 12. The sections below explain in further details the
changes to accounting policies implemented.
IFRS 17, Insurance contracts
On 1 January 2023, the Group implemented IFRS 17, Insurance Contracts. Under IFRS 17, insurance contracts are contracts under which the Group
accepts significant insurance risk from a policyholder, by agreeing to compensate the policyholder if a specified uncertain future event adversely affects
the policyholder. Insurance contracts with direct participation features are those which, at inception, (i) the contractual terms specify that the policy-
holder participates in a share of a clearly identified pool of underlying items, (ii) the entity expects to pay to the policyholder an amount equal to a sub-
stantial share of the fair value returns on the underlying items, and (iii) the entity expects a substantial proportion of any change in the amounts to be paid
to the policyholder to vary with the change in fair value of the underlying items.
In Danske Bank Group, insurance contracts are held by the wholly owned subsidiary Danica Pension (Danica).
Insurance contracts are divided into portfolios and groups. Each portfolio of insurance contracts are contracts that are subject to similar risks and are
managed together. The Group has four portfolios of insurance contracts, based on an assessment of similar risks and whether they are managed together:
•
•
•
•
an average-rate portfolio
a unit-linked portfolio
a portfolio of legacy life insurance product in run-off
a portfolio containing health and accident insurance contracts.
Each portfolio of contracts is divided into (i) groups of contracts that are onerous at initial recognition (ii) groups of contracts that at initial recognition ,
have no significant possibility of becoming onerous subsequently, and (iii) groups of remaining contracts in the portfolio. Groups of insurance contracts
issued are initially recognised from the earliest of the (i) the beginning of the coverage period of the group, (ii) the date when the first payment from a
policyholder becomes due, or (iii) for a group of onerous contracts, when the group becomes onerous. Furthermore, each group is divided into annual
cohorts so that each group only includes contracts issued no more than one year apart.
The Group measures insurance contracts using the General Measurement Model (GMM, or Building Block approach, BBA), Variable Fee Approach (VFA)
or Premium Allocation Approach (PAA). Groups of insurance contracts under GMM or VFA are initially measured as the total of fulfilment cash flows
(which comprise estimated future cash flows, an adjustment for time value of money and financial risks related to future cash flows, and a risk adjustmen t
for non-financial risk) and contractual service margin (CSM; unearned profit that will be recognised as the Group provides insurance contract services).
An insurance contract is onerous at the date of initial recognition if the fulfilment cash flows, any previously recognised insurance acquisition cash flows
and any cash flows arising from the contract at the date of initial recognition are in total a net outflow. The loss from onerous insurance contracts is
recognised immediately in profit or loss, and no CSM is recognised on the balance sheet on initial recognition.
At each reporting date, the group of insurance contracts is subsequently measured as the sum of the liability for remaining coverage (comprising fulfil-
ment cash flows relating to future service and CSM) and liability for incurred claims (comprising fulfilment cash flows relating to past service).
VFA is applied to the majority of insurance contracts, since they meet the definition of insurance contracts with direct participation features. Legacy life
insurance products in run-off are measured using BBA.
Health and accident insurance contracts are measured under PAA, which means the liability for remaining coverage is measured on initial recognition
at premiums received less any acquisition cash flows paid and any amounts arising from the derecognition of insurance acquisition cash flows asset.
The Group will apply the annual cohort exemption from the EU to the average-rate portfolio.
IFRS 17 has not changed the method of discounting cash flows for insurance contracts, and the Group will continue to apply the European Insurance
and Occupational Pension Authority (EIOPA) yield curve including a volatility adjustment.
The risk adjustment for non-financial risk under IFRS 17 corresponds to the risk margin under IFRS 4. However, changes in the risk adjustment are
recognised either in the Income statement or in the CSM, whereas changes in the risk margin under IFRS 4 were recognised only in the Income state-
ment.
Danske Bank / Interim report – first half 2023 44/88
Notes – Danske Bank Group
G2. Changes in accounting policies, financial highlights and segment reporting continued
The key impacts of the implementation of IFRS 17 are:
•
•
•
•
•
•
•
Life insurance products and Health and Accident products have been disaggregated, as they are subject to different risks and therefore cannot
be managed together under IFRS 17. This has resulted in a decrease of DKK 1.4 billion in the Group’s equity as at 1 January 2022
Premiums are no longer recognised in profit or loss at their due dates. Instead, the CSM is recognised in insurance revenue as services are
provided over the expected coverage period of the group of insurance contracts.
Benefits are no longer recognised in profit or loss when paid. Instead, insurance service expenses are recognised when incurred, comprising
incurred claims and other incurred insurance expenses.
Changes in insurance obligations during the year due to additional provisions for benefit guarantees and the tax on pension returns are no
longer under Net trading income or loss.
The return on assets earmarked for insurance contracts is no longer carried under Net interest income and Net trading income or loss. This
is now presented as Net return on investments backing insurance liabilities.
The Group has simplified its reporting of Danica, and now reports the majority of Danica’s assets and liabilities under Assets under insur-
ance contracts and Liabilities under insurance contracts respectively in the Balance sheet. Previously, an allocation of Danica’s assets and
liabilities (equating to Danica’s equity) were consolidated on a line-by-line basis in the Balance sheet.
The presentation of the Income statement has been changed from 2023: the line items Net premiums and Net insurance benefits are re-
moved, and new lines in relation to insurance are added: Insurance service result and other insurance income, Net return on investments
backing insurance liabilities and Net financa income or expense from insurance. The Income statement has thus been restated for 2022.
Changes in accounting policies as a result of IFRS 17 have been applied using the fair value approach, since the full retrospective approach is impracti-
cable to apply due to relevant data not being available or high resource consumption.
In addition, the following changes have been made to accounting policies as a result of IFRS 17 implementation:
• When, and only when, the Group reacquires its own equity instruments (i.e. own shares) to be included in investment funds that provides
investors with benefits determined by units in the fund, and for which financial liabilities are recognised for the amounts to be paid to those
investors, IAS 32 has been amended with an optional election not to deduct these shares from equity, and account for them as financial
assets held at fair value through profit or loss. The Group has applied this election to its own shares in Pooled schemes and Unit-linked in-
vestment contracts which meet the IAS 32 election criteria. The same election applies to the Group’s own shares that are included as un-
derlying items of direct participation contracts (Assets under insurance contracts).
• When, and only when the Group repurchases its own financial liabilities to be included in investment funds that provides investors with benefits
determined by units in the fund, and for which financial liabilities are recognised for the amounts to be paid to those investors, or includes the
own financial liabilities as underlying items of direct participating contracts, IFRS 9 has been amended with an optional election to not derec-
ognise the financial liabilities, and to account for the repurchased instruments as financial assets held at fair value through profit or loss. The
Group has applied this election to own bonds in Assets under insurance contracts which meet the IFRS 9 election criteria.
The impact of the changes in IAS 32 and IFRS 9 accounting policies resulted in an increase of DKK 0.7 billion in the Group’s equity and the Group’s assets
as at 1 January 2022.
At the transition date of 1 January 2022, the Group:
•
•
•
•
•
•
Identified, recognised and measured each group of insurance contracts and reinsurance contracts according to IFRS 17
Derecognised previously reported balances that would not have existed if IFRS 17 had always been applied
Reclassified Danica’s assets and liabilities to Assets under insurance contracts and Liabilities under insurance contracts respectively where
relevant
Recognised own shares and own bonds as assets that were underlying items of direct participating contracts at fair value
Recognised own shares that were reacquired to be held in investment funds on behalf of customers
Recognised the resulting net differences in equity.
The DKK 1.4 billion decrease in the Group’s equity from IFRS 17 implementation and DKK 0.7 billion increase from the IAS 32 and IFRS 9 accountin g
policy changes result in a net decrease in equity of DKK 0.7 billion as at 1 January 2022, which is presented in the Statement of changes in equity. The
impact of these changes increases the Group’s 2022 result by DKK 0.5 billion. The impact on the Group’s equity as at 31 December 2022 is a net
decrease of DKK 40 million, as result of the increase in the Group’s 2022 result and the direct impact on equity from the change in treatment of own
shares.
A reconciliation of balances between 31 December 2021 and 1 January 2022 is presented below, showing the impact of IFRS 17 (including the reclassifi-
cation of Danica’s assets and liabilities), the change in treatment of the Group’s own shares, and the change in treatment of the Group’s own bonds.
Ratios for regulatory requirements in 2022 have not been restated as a result of the changes described above. The overall impact on equity at 31
December 2022 of DKK 40 million is immaterial, and therefore the Group’s total capital and capital ratios for 2022 will not be revised nor resubmitte d
to regulators, and will remain as published in the Annual Report 2022.
Danske Bank / Interim report – first half 2023 45/88
Notes – Danske Bank Group
G2. Changes in accounting policies, financial highlights and segment reporting continued
Amendment to IAS 1, Presentation of financial statements
The first amendment to IAS 1 provides a more general approach to classifying liabilities as current or non-current, based on the contractual arrange-
ments in place at the reporting date, rather than based on whether management intends to exercise a right to defer a settlement of the liability.
The second amendment to IAS 1 requires disclosure of material accounting policy information, rather than significant accounting policies. Accountin g
policy information is considered to be material if users of the financial statements need it to understand other material information in the financial state-
ments. If immaterial accounting policy information is disclosed, it should not obscure material accounting policy information.
The amendments have no impact on the financial statements.
Amendment to IAS 8, Accounting policies, changes in accounting estimates and errors
The amendments introduce a definition of accounting estimates – monetary amounts in financial statements that are subject to measurement uncer-
tainty – and clarifies that a change in accounting estimate that results from new information or new developments is not the correction of an error.
Similarly, the effects of a change in an input or a measurement technique used to develop an accounting estimate are changes in accounting estimate s
if they do not result from the correction of prior period errors.
The amendments have no impact on the financial statements.
Amendment to IAS 12, Income taxes
The first amendment to IAS 12 clarifies how entities should account for deferred tax on assets and liabilities arising from a single transaction such as
leases and decommissioning obligations.
The main change is that the initial recognition exemption in IAS 12 does not apply to transactions in which equal amounts of deductible and taxable
temporary differences arise on initial recognition.
The second amendment introduces an exception to the requirement of IAS 12 that an entity does not recognise and does not disclose information about
deferred tax assets and liabilities related to the OECD Pillar Two income taxes.
The amendments have no impact on the financial statements.
Danske Bank / Interim report – first half 2023 46/88
Notes – Danske Bank Group
G2. Changes in accounting policies, financial highlights and segment reporting continued
The table below shows a reconciliation of the Group’s balances between 31 December 2021 and 1 January 2022, showing the impact of IFRS 17 (in-
cluding the reclassification of Danica’s assets and liabilities), the change in treatment of the Group’s own shares, and the change in treatment of the
Group’s own bonds.
Effect of changes in accounting policy as at 1 January 2022
(DKK millions)
Assets
Cash in hand and demand deposits with central banks
Due from credit institutions and central banks
Trading portfolio assets
Investment securities
Loans at amortised cost
Loans at fair value
Assets under pooled schemes and unit-linked investment contracts
Assets under insurance contracts
Assets held for sale
Intangible assets
Tax assets
Other assets
31 December
2021
293,386
71,156
509,590
303,777
1,027,442
1,024,461
76,654
547,806
28,800
8,819
4,510
39,433
IFRS 17
-
-7
-164
-22,835
-
-
-
29,731
-
-2,628
-
-4,097
Remeasurements
IAS 32 –
own shares
IFRS 9 –
own bonds
1 January
2022
-
-
-
-
-
-
151
507
-
-
-
-
293,386
-
71,149
-
509,426
-
-
280,942
- 1,027,442
- 1,024,461
76,805
-
622,634
44,590
28,800
-
6,191
-
4,510
-
35,336
-
Total assets
3,935,834
-
658
44,590 3,981,082
Liabilities
Due to credit institutions and central banks
Trading portfolio liabilities
Deposits
Issued bonds at fair value
Issued bonds at amortised cost
Deposits under pooled schemes and unit-linked investment contracts
Liabilities under insurance contracts
Liabilities in disposal groups held for sale
Tax liabilities
Other liabilities
Non-preferred senior bonds
Subordinated debt
Total liabilities
Equity
Share capital
Foreign currency translation reserve
Reserve for bonds at fair value (OCI)
Retained earnings
Proposed dividends
Shareholders of Danske Bank A/S (the Parent Company)
Additional tier 1 capital holders
Non-controlling interests
Total equity
Total liabilities and equity
172,976
374,959
1,292,030
794,909
223,854
76,982
588,736
29,577
1,864
56,268
107,654
39,321
-
-
-
-
-
-
2,247
-
-460
-422
-
-
3,759,130
1,365
8,622
-612
34
161,439
1,724
171,207
5,497
-
-
-
-1,365
-
-1,365
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
658
-
658
-
-
176,704
-1,365
658
172,976
-
374,959
-
- 1,292,030
839,335
223,854
76,982
590,983
29,577
1,404
56,010
107,654
39,321
44,426
-
-
-
-
-
164
-
-
44,590 3,805,085
-
-
-
-
-
-
-
-
-
8,622
-612
34
160,732
1,724
170,500
5,497
-
175,997
3,935,834
-
658
44,590 3,981,082
Danske Bank / Interim report – first half 2023 47/88
Notes – Danske Bank Group
G2. Changes in accounting policies, financial highlights and segment reporting continued
b) Changes in financial highlights and segment reporting
On 1 January 2023, the Group implemented IFRS 17, Insurance contracts, resulting in the restatement of 2022. See note G2(a) for details of the changes
in accounting policy. At the same time, the Group has simplified its reporting of Danica Pension, by stopping the allocation of Danica’s equity to Group
Treasury (within Group Functions). The table below shows the restated amounts in the financial highlights and segment reporting for first half 2022:
Changes in financial highlights and segment reporting – first half 2022 restated
(DKK millions)
Net interest income
Net fee income
Net trading income
Net income from insurance business
Other income
Total income
Operating expenses
of which resolution fund, bank tax etc,
of which impairment charges, other intangible assets
Profit before loan impairment charges
Loan impairment charges
Profit before tax (core)
Profit before tax, Non-core
Profit before tax
Loans, excluding reverse transactions
Other assets (including Non-core)
Total assets
Deposits, excluding repo deposits
Other liabilities (including Non-core)
Allocated capital
Total liabilities and equity
Profit before tax as % p,a, of allocated capital (avg,)
Cost/income ratio (%)
Full-time-equivalent staff, end of period
Financial
Highlights
first half 2022
11,440
6,537
175
-38
959
Implemen-
tation of
IFRS 17
-70
-
232
-65
-
Elimination
of own
shares
-
-
-87
-
-
Elimination
of own
bonds
-
-
-
-
-
Adjusted
Financial
Highlights
11,370
6,537
320
-103
959
19,083
12,793
491
24
6,290
426
5,864
-
-
-
-
-
-
-
-
-
-
37,638
17
5,881
1,819,297
2,293,005
-87
-
-
-
-87
-
-87
-
-87
-
671
97
-
-
-
97
-
97
-
97
-
-
-
671
37,638
4,112,301
-
1,290
-1,290
-
-
671
-
37,638
-
1,155,841
2,785,686
170,775
-
-
-
-
671
37,638
4,112,301
-
-
-
-
-
-
6,8
67,0
21,663
19,073
12,793
491
24
6,280
426
5,854
17
5,871
1,819,297
2,254,696
4,073,992
1,155,841
2,746,757
171,394
4,073,992
6,9
67,1
21,663
Danske Bank / Interim report – first half 2023 48/88
Notes – Danske Bank Group
G3. Business segments
a) Business model and business segmentation
The Group’s commercial activities are organised in five reporting business units:
•
•
•
•
•
Personal Customers, which serves personal customers across all markets
Business Customers, which serves small and medium-sized business customers across all markets, and includes the Group’s Asset Finance operations
Large Corporates & Institutions, which serves large corporates and institutional customers across all Nordic markets
Danica Pension, which specialises in pension schemes, life insurance policies and health insurance policies in Denmark
Northern Ireland, which serves retail and commercial customers through a network of branches and business centres in Northern Ireland alongside
digital channels.
Besides the five commercial business units, the Group’s reportable segments under IFRS 8 include Non-core and Group Functions.
Business segments
first half 2023
(DKK millions)
Net interest income
Net fee income
Net trading income
Net income from insurance
business
Other income*
Insurance service result and
other insurance income
Net return on investments
backing insurance liabilities
Net finance income or ex-
pense from insurance
Total income
Operating expenses
of which resolution fund,
bank tax etc,
Profit before loan impairment
charges
Loan impairment charges
Profit before tax, core
Profit before tax, Non-core
Personal
Customers
7,017
2,022
171
Business
Custom-
ers
5,864
893
261
Large
Corporates
& Institu-
tions
3,414
2,641
1,960
Northern
Ireland
1,236
168
53
Non-
core
-
-
-
Danica
-
-
-
Group
Functions
-907
-124
390
Elimina-
tions
-83
93
-63
Reclas-
sifica-
Financial
tion
highlights
-1,944
16,540
5,693
-21
2,772 2,003
IFRS
financial
statements
14,595
5,672
4,775
-
-650
-
536
-
12
689
-
-
10
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
8,560
4,462
7,555
2,455
8,028
3,543
689
-
1,466
657
85
127
246
-
-
4,098
478
3,620
-
5,099
142
4,957
-
4,485
-522
5,006
-
689
-
689
-
809
-131
941
-
-
-
-
-
-
-
-
-
-
-
-
-25
-
1,365
-
-1,380
689
-689
-106 1,648
-
1,542
-
-
-
-
-
-
-
447
447
- 13,026
13,026
- -12,784
-12,784
723
2,848
-1,432
-1,346
25,587 1,686
12,618 1,711
27,273
14,329
38
-
496
-496
-
-2,125
5
-2,130
-
-86
-
-86
-
12,969
-28
12,997
-25
-25
-
-25
25
12,944
-28
12,972
-
Profit before tax
3,620
4,957
5,006
689
941
-25
-2,130
-86
12,972
-
12,972
Loans, excluding reverse
transactions
Other assets (including Non-
core)
762,975 624,897
309,934
-
56,322
-
26,031
-27,560 1,752,598 1,144 1,753,743
343,389 181,043 3,557,392 546,144
66,678 1,509 4,404,443
7,121,589 1,979,010
-1,144 1,977,865
-
Total assets
1,106,364 805,940 3,867,326 546,144 123,000 1,509 4,430,475
7,149,149 3,731,608
- 3,731,608
-
Deposits, excluding repo de-
posits
Other liabilities (including
Non-core)
Allocated capital
413,514 261,293
325,772
-
98,700
-
2,749
-9,083 1,092,945 1,896 1,094,841
663,670 505,188 3,500,409 546,144
-
29,180
39,460
41,145
18,437 2,244 4,373,990
53,001
-
5,862
7,140,066 2,470,015
- 168,648
-1,896 2,468,120
168,648
-
-
-
Total liabilities and equity
1,106,364 805,940 3,867,326 546,144 123,000 2,244 4,429,740
7,149,149 3,731,608
- 3,731,608
Profit before tax as % p,a, of
allocated capital (avg,)
Cost/income ratio (%)
Full-time-equivalent staff, end
of period
24.5
52.1
25.1
32.5
24.9
44.1
7.0
-
30.8
44.8
-
-
-12.1
-
4,288
1,677
2,103
898
1,285
12
11,077
-
-
-
15.8
49.3
21,339
-
-
-
15.8
52.5
21,339
* Other income in the IFRS financial statements column includes Gain or loss on sale of disposal groups.
Danske Bank / Interim report – first half 2023 49/88
Notes – Danske Bank Group
G3. Business segments continued
Business segments
First half 2022
(DKK millions)
Net interest income
Net fee income
Net trading income
Net income from insur-
ance business
Other income**
Insurance service result
and other insurance in-
come
Net return on investments
backing insurance liabili-
ties
Net finance income or ex-
pense from insurance
Total income
Operating expenses
of which resolution fund,
bank tax etc,
of which impairment
charges, other intangible
assets
Profit before loan impair-
ment charges
Loan impairment charges
Profit before tax, core
Profit before tax, Non-core
Personal
Customers
3,871
2,555
220
Business
Custom-
ers
4,083
906
243
Large
Corporates
& Institu-
tions Danica*
-
-
-
2,611
2,932
27
Northern
Ireland
823
164
-209
Non-
core
-
-
-
Group
Functions*
-1
-4
42
Elimina-
tions*
-18
-16
-2
Financial
highlights*
Reclas-
sifica-
tion*
11,370 1,056
-15
320 -1,031
6,537
IFRS
financial
state-
ments*
12,426
6,522
-711
-
508
-
431
-
2
-103
-
-
15
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
7,154
5,097
5,663
2,665
5,572
3,491
-103
-
793
623
81
112
254
-
-
-
-
-
2,057
325
1,732
-
2,997
198
2,799
-
2,081
-145
2,226
-
-103
-
-103
-
-
-
169
38
131
-
-
-
-
-
-
-
-
-
-
-
-
-
17
17
-
1,309
-
-1,306
-103
103
959 2,293
-
3,253
-
-
-
-
-
-
-
756
756
-
58,421
-
-58,421
- 57,147
57,147
1,347
994
-1,342
-78
19,083 1,889
12,793 1,933
20,971
14,726
43
24
352
10
342
-
-
-
491
-491
24
-24
-
-
-1,264
-
-1,264
-
6,290
426
5,864
17
-44
-61
17
-17
6,246
365
5,881
-
342
-1,264
5,881
-
5,881
Profit before tax
1,732
2,799
2,226
-103
131
Loans, excluding reverse
transactions
Other assets (including
Non-core)
825,657 625,765
310,039
- 57,601
-
29,713
-29,479 1,819,297 1,316 1,820,613
316,326 202,859 3,482,262 730,320 60,024 1,956 4,540,645 -7,041,386 2,293,005
-1,316 2,291,688
Total assets
1,141,982 828,624 3,792,301 730,320 117,625 1,956 4,570,359 -7,070,865 4,112,301
- 4,112,301
Deposits, excluding repo
deposits
Other liabilities (including
Non-core)
Allocated capital
420,252 290,934
352,697
- 99,977
-
1,859
-9,878 1,155,841 2,174 1,158,015
691,396 498,675 3,395,531 711,235 12,178 2,539 4,535,789 -7,061,658 2,785,686 -2,174 2,783,511
170,775
-
30,334 39,015
44,072 19,085
170,775
32,127
5,470
671
-
Total liabilities and equity 1,141,982 828,624 3,792,301 730,320 117,625 2,539 4,569,775 -7,070,865 4,112,301
- 4,112,301
Profit before tax as % p,a,
of allocated capital (avg,)
Cost/income ratio (%)
Full-time-equivalent staff,
end of period
11.1
71.2
14.0
47.1
10.5
62.7
-1.0
-
4.3
78.6
-
-
1.8
73.8
4,874
1,696
2,097
957
1,256
37
10,746
-
-
-
6.8
67.0
21,663
-
-
-
6.8
70.2
21,663
* Comparative information has been restated, as described in note G2(a) and G2(b).
** Other income in the IFRS financial statements column includes Gain or loss on sale of disposal groups.
Danske Bank / Interim report – first half 2023 50/88
Notes – Danske Bank Group
G3. Business model and business segmentation continued
(b) Reconciliation of the financial highlights and segment reporting to the IFRS financial statements
The ‘Reclassification’ column in the tables above shows the reconciliation between the presentation in the financial highlights and segment reporting and
the presentation in the IFRS financial statements. The policies for the reclassifications between the financial highlights and the IFRS financial statements
are disclosed on page 85 in Annual Report 2022. Net income from insurance business is presented before elimination of intra-group transactions. The
decomposition of the reclassification between the IFRS income statement and Financial highlights is shown in the tables below.
Reclassification first half 2023
(DKK millions)
Net interest income
Net fee income
Net trading income
Net income from insurance business
Other income*
Insurance service result and other insurance in-
come
Net return on investments backing insurance li-
abilities
Net finance income or expense from insurance
Total income
Operating expenses
Profit before loan impairment charges
Loan impairment charges
Profit before tax, core
Profit before tax, Non-core
Profit before tax
IFRS financial
statements
14,595
5,672
4,775
-
1,542
Operating
leases
-
-
-
-
-1,687
Markets, Investment
Banking & Securities
and Group Treasury
1,940
21
-2,000
-
39
Danica
Pension Non-core
4
-
-3
-
-
-
-
-
689
-
447
13,026
-12,784
27,273
14,329
12,944
-28
12,972
-
12,972
-
-
-
-1,687
-1,687
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-447
-13,026
12,784
-
-
-
-
-
-
-
-
-
-
1
-24
25
-
25
-25
-
* Other income in the IFRS financial statements column includes Gain or loss on sale of disposal groups.
Reclassification first half 2022
(DKK millions)
Net interest income
Net fee income
Net trading income
Net income from insurance business
Other income**
Insurance service result and other insurance in-
come
Net return on investments backing insurance li-
abilities
Net finance income or expense from insurance
Total income
Operating expenses
Profit before loan impairment charges
Loan impairment charges
Profit before tax, core
Profit before tax, Non-core
Profit before tax
IFRS financial
statements*
12,426
6,522
-711
-
3,253
Operating
leases
-
-
-
-
-1,868
Markets, Investment
Banking & Securities
and Group Treasury
-1,062
20
1,043
-
-2
Danica
Pension* Non-core
5
-5
-11
-
-9
-
-
-
-103
-415
756
-58,421
57,147
-
-
-
20,971
14,726
-1,868
-1,868
6,246
365
5,881
-
5,881
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-756
58,421
-57,147
-
-
-
-
-
-
-
-
-
-
-21
-65
44
61
-17
17
-
* Comparative information has been restated, as described in note G2(a) and G2(b).
** Other income in the IFRS financial statements column includes Gain or loss on sale of disposal groups.
Total re-
classifica-
tion
1,944
21
-2,003
689
-1,648
-447
-13,026
12,784
-1,686
-1,711
25
-
25
-25
Financial
highlights
16,540
5,693
2,772
689
-106
-
-
-
25,587
12,618
12,969
-28
12,997
-25
-
12,972
Total re-
classifica-
tion*
-1,056
15
1,031
-103
-2,293
-756
58,421
-57,147
-1,889
-1,933
44
61
-17
17
-
Financial
highlights*
11,370
6,537
320
-103
959
-
-
-
19,083
12,793
6,290
426
5,864
17
5,881
Danske Bank / Interim report – first half 2023 51/88
Notes – Danske Bank Group
G4. Income
(a) Interest income and interest expense
Negative interest income during first half 2023 amounted to DKK 3 million (30 June 2022: DKK 1,108 million). Negative interest expenses amounted to
DKK 4 million (30 June 2022: DKK 2,190 million). In the income statement, negative interest income is recognised as interest expenses and negative
interest expenses are recognised as interest income.
(b) Fee income
Note G6 of the Annual Report 2022 provides additional information on the Group’s accounting policy for fee income, including the description by fee type.
Fee income first half 2023
(DKK millions)
Financial
highlights
- net fee income Reclassifications
IFRS
- net fee income
Fee expense
IFRS - gross fee
income
Investment
Money transfers, account fee, cash management and other fees
Lending and Guarantees
Capital markets
Total
2,059
1,931
1,117
584
5,693
343
-142
301
-523
-21
Fee income first half 2022
Financial
highlights
2,402
1,790
1,419
61
5,672
IFRS
1,484
513
66
-
2,063
3,886
2,303
1,484
61
7,735
IFRS - gross fee
income
(DKK millions)
- net fee income Reclassifications
- net fee income
Fee expense
Investment*
Money transfers, account fee, cash management and other fees
Lending and Guarantees
Capital markets
Total
* Comparative information has been restated, as described in note G2(a) and G2(b).
(c) Gain or loss on sale of disposal groups
2,528
1,880
1,459
669
6,537
310
-118
307
-513
-15
2,838
1,762
1,766
156
6,522
1,831
644
55
-
2,531
4,669
2,406
1,821
156
9,052
Gain or loss on sale of disposal groups for the six months ending 30 June 2023 includes the prudent evaluation and expected costs directly attributab le
to the sale of personal customers business in Norway, as announced on 19 July 2023. See note G8 for more detail. During the first half 2022, Gain or
loss on sale of disposal groups included a gain of DKK 421 million on the sale of business activities in Luxembourg and a gain of DKK 415 million on the
sale of Danica Pensjonforsikring AS (Danica Pension business segment in Norway).
(d) Other income
Other income amounted to DKK 2,236 million for the six months ending 30 June 2023 (30 June 2022: DKK 2,417 million). Other income includes
income from lease assets, investment property and real estate brokerage, and income from holdings in associates.
Danske Bank / Interim report – first half 2023 52/88
Notes – Danske Bank Group
G5. Loan impairment charges and reconciliation of total allowance account
Loan impairment charges include impairment charges for expected credit losses on loans, lease receivables, bonds at amortised cost and fair value
through other comprehensive income, certain loan commitments and financial guarantee contracts as well as fair value adjustments of the credit risk on
loans measured at fair value.
Loan impairment charges
(DKK millions)
ECL on new assets
ECL on assets derecognised
Impact of net remeasurement of ECL (incl. changes in models)
Write-offs charged directly to income statement
Received on claims previously written off
Interest income, effective interest method
Total
Reconciliation of total allowance account
(DKK millions)
ECL allowance account as at 1 January 2022
Transferred to stage 1 during the period
Transferred to stage 2 during the period
Transferred to stage 3 during the period
ECL on new assets
ECL on assets derecognised
Impact of net remeasurement of ECL (incl. changes in models)
Write-offs debited to the allowance account
Foreign exchange adjustments
Other changes
ECL allowance account as at 30 June 2022
ECL allowance account as at 1 January 2023
Transferred to stage 1 during the period
Transferred to stage 2 during the period
Transferred to stage 3 during the period
ECL on new assets
ECL on assets derecognised
Impact of net remeasurement of ECL (incl. changes in models)
Write-offs debited to the allowance account
Foreign exchange adjustments
Other changes
30 June 2023 30 June 2022
1,562
-1,499
169
460
-566
-153
-28
2,092
-4,298
1,970
897
-173
-123
365
Stage 1
Stage 2
Stage 3
Total
2,717
866
-306
-18
476
-476
-158
-
-15
-18
6,807
-813
628
-369
636
-766
719
-2
-65
2
13,223
-54
-322
387
980
-3,056
1,409
-2,758
134
33
22,746
-
-
-
2,092
-4,298
1,970
-2,760
54
17
3,068
6,777
9,975
19,820
3,273
8,082
8,290
19,645
1,548
-179
-12
332
-234
-1,289
-
-37
-
-1,485
368
-297
926
-784
1,321
-
-167
-6
-63
-189
309
303
-481
136
-180
-95
10
-
-
-
1,562
-1,499
169
-180
-299
4
ECL allowance account as at 30 June 2023
3,403
7,957
8,041
19,401
The movements on the allowance account are determined by comparing the classification and amount in the balance sheet at the beginning and the end
of the period. For further information on the decomposition of the allowance account on facilities in stages 1-3 under IFRS 9, see note G14.
Danske Bank / Interim report – first half 2023 53/88
Notes – Danske Bank Group
G6. Insurance service result and other insurance income
The Group implemented IFRS 17, Insurance contracts on 1 January 2023, as described in note G2(a).
Net insurance result
(DKK millions)
Insurance revenue
Insurance service expenses
Net expenses from reinsurance
Insurance service result
Other insurance related income
Insurance service result and other insurance income
30 June
2023
2,763
2,298
30
435
13
447
30 June
2022
2,584
1,857
22
705
51
756
Notes – Danske Bank Group
G7. Issued bonds, subordinated debt and additional tier 1 capital
Issued bonds at fair value
(DKK millions)
Bonds issued by Realkredit Danmark (covered bonds)
Commercial papers and certificates of deposits
Structured retail notes
Issued bonds at fair value, total
* Comparative information has been restated, as described in note G2(a).
Issued bonds at amortised cost
(DKK millions)
Commercial papers and certificates of deposits
Preferred senior bonds*
Covered bonds
Structured retail notes*
Issued bonds at amortised cost, total
Non-preferred senior bonds
Danske Bank / Interim report – first half 2023 54/88
30 June
2023
31 December
2022*
712,186
7,434
2,583
711,773
9,119
3,032
722,204
723,923
30 June 31 December
2022*
-
48,356
140,829
3,498
2023
5,913
56,185
140,718
2,498
205,314
192,682
93,113
93,235
* DKK 3,498 million of Structured retail notes that were included in Preferred senior bonds as at 31 December 2022 is now presented in a separate line.
Further information on issued bonds at fair value through profit or loss can be found in note G16 of the Annual Report 2022. The issuance and redemption of
bonds (including commercial papers and certificates of deposits at fair value) during the year are presented in the tables below.
Nominal value
(DKK millions)
Commercial papers and certificate of deposits
Preferred senior bonds*
Covered bonds
Non-preferred senior bonds
1 January
2023
9,128
59,348
156,740
100,586
Issued
Redeemed
29,496
23,700
14,325
16,146
25,023
17,422
5,410
13,660
Foreign
currency
translation
-249
-789
-75
-1,736
30 June
2023
13,352
64,837
165,579
101,336
Other issued bonds
325,801
83,667
61,515
-2,849
345,104
* Preferred senior bonds includes structured retail notes.
Nominal value
(DKK millions)
Commercial papers and certificate of deposits
Preferred senior bonds*
Covered bonds
Non-preferred senior bonds
1 January
2022
23,712
67,724
165,067
108,104
Issued
Redeemed
13,445
1,400
39,600
20,100
26,709
14,630
39,605
30,530
Foreign
currency 31 December
2022
translation
-1,321
4,854
-8,322
2,913
9,128
59,348
156,740
100,586
Other issued bonds
364,607
74,545
111,475
-1,876
325,801
* Preferred senior bonds includes structured retail notes.
Subordinated debt and additional tier 1 capital
As at 30 June 2023, the nominal value of subordinated debt, including liability accounted additional tier 1 capital, amounted to DKK 40,273 million (31
December 2022: DKK 40,514 million). During the six months ended 30 June 2023, the Group did not issue or redeem any additional tier 1 or tier 2 capital
instruments. During 2022, the Group redeemed EUR 750 million of additional tier 1 capital accounted for as equity.
For the additional tier 1 capital, Danske Bank A/S may, at its sole discretion, omit interest payments to bondholders. Any interest payments are paid out of
distributable items, which primarily consist of retained earnings in Danske Bank A/S and Danske Bank Group (see section 6.4.3 of Risk Management 2022
for further information). As at 30 June 2023, distributable items for Danske Bank A/S amounted to DKK 136.3 billion (31 December 2022: DKK 126.7
billion). The additional tier 1 capital will be temporarily written down or converted into a variable number of ordinary shares, depending on the terms of each
issued bond, if the common equity tier 1 capital ratio falls below 7% for Danske Bank A/S or Danske Bank Group. As at 30 June 2023 the common equity tier
1 capital ratio was 21.0% (31 December 2022: 20.3%) for Danske Bank A/S. The ratios for the Danske Bank Group are disclosed in the Statement of capital.
Notes – Danske Bank Group
G8. Assets held for sale and Liabilities in disposal groups held for sale
Assets held for sale and Liabilities in disposal groups held for sale include assets and liabilities that fall under IFRS 5.
(DKK millions)
Assets held for sale
Loans held for sale
Other
Total
Liabilities in disposal groups
Deposits held for sale
Total
Danske Bank / Interim report – first half 2023 55/88
30 June
2023
31 December
2022
120,361
304
120,665
32,949
32,949
-
350
350
-
-
As announced on July 19 2023, Danske Bank has entered into an agreement to sell our personal customers business Norway. The sale will include loans and
deposits. On reclassification to held for sale, a loss of DKK 0.7 billion was recognised in relation to prudent evalutation and expected costs directly attributable
to the sale, and is included in Gain or loss on sale of disposal groups.
In June 2023, Danske Bank also announced that it will sell Danske IT, a fully-owned subsidiary of Danske Bank, to Infosys. As part of the sale, colleagues in
Danske IT will transfer to Infosys. The deal is subject to customary authority approval, which is expected during the second half of 2023, with the sale expected
also in the second half of 2023. The sale will include approximately DKK 0.3 billion of assets and DKK 0.2 billion of liabilities. The assets and liabilities are not
included in the table above.
Assets held for sale also includes lease assets (where the Group acts as a lessor) put up for sale at the end of the lease and properties taken over by the
Group under non-performing loan agreements. The Group expects to sell the properties through a real estate agent within 12 months from the date of acqui-
sition. The properties comprise properties in Denmark and in other countries.
G9. Other assets and Other liabilities
(A) Other assets and other liabilities (DKK millions)
Other assets
Accrued interest and commissions due
Prepayments, accruals and other amounts due
Defined benefit pension plan, net assets
Investment property
Tangible assets
Right of use lease assets
Holdings in associates
Total
Other liabilities
Sundry creditors
Estonia settlement
Accrued interest and commissions due
Defined benefit pension plans, net liabilities
Other staff commitments
Lease liabilities
Loan commitments and guarantees etc,
Reserves subject to a reimbursement obligation
Provisions, including litigations
Total
* Comparative information has been restated, as described in note G2(a).
30 June
2023
31 December
2022*
6,771
13,325
1,545
159
7,425
2,315
564
2,256
17,048
1,486
146
7,586
2,615
536
32,104
31,673
41,235
-
11,459
338
1,498
2,439
2,550
4
2,847
35,822
15,300
7,634
366
1,804
2,743
2,627
4
2,678
62,369
68,978
In the table above, Provisions, including litigations includes customer relations, regulatory and legal proceedings, restructuring costs and other provi-
sions.
Danske Bank / Interim report – first half 2023 56/88
Notes – Danske Bank Group
G10. Foreign currency translation reserve
The Group has granted loans to its branches in Sweden, Norway and Finland in the currency of the foreign unit for a total of DKK 36,584 million (31
December 2022: DKK 34,573 million). The loans are part of the net investment in those units and the foreign currency gains/losses on these loans are
recognised in Other comprehensive income. The funding of the loans is partly done in DKK in order to create a so-called structural FX hedge position in
accordance with banking regulations, i.e. to reduce the impact on capital ratios resulting from changes in the risk exposure amount due to changes in
currency rates. The Group’s net investment in its subsidiaries Danske Hypotek AB (Sweden) and Danske Mortgage Bank Plc (Finland) is included in the
structural FX hedge position to extend the hedge to the risk exposure amount measured by currency for EUR, NOK and SEK across the entire Group
balance sheet, although with constraints to the size of the loans to the foreign branches and the net investments in the foreign subsidiaries. This strategy
of partly hedging the sensitivity to capital ratios from volatility in foreign currency rates, increases the volatility in Other comprehensive income and the
Foreign currency translation reserve in equity under IFRS since it decreases the hedge of the currency risk on the net investments in those units. As at
30 June 2023, the structural FX hedge position totalled DKK 40,750 million (31 December 2022: DKK 41,350 million) and a loss of DKK 2,203 millio n
has been recognised in Other comprehensive income during the first half 2023, primarily due to a weakening of NOK against DKK throughout the first
half 2023. For the same reason, a loss of DKK 1,222 million was recognised in Other comprehensive income during the first half of 2022.
Danske Bank / Interim report – first half 2023 57/88
Notes – Danske Bank Group
G11. Guarantees, commitments and contingent liabilities
Contingent liabilities consist of possible liabilities arising from past events. The existence of such liabilities will be confirmed only by the occurrence or
non-occurrence of one or more uncertain future events not wholly within the Group’s control. Contingent liabilities that can, but are not likely to, result in
an outflow of economic resources are disclosed.
The Group uses a variety of loan related financial instruments to meet customers’ financial requirements. Instruments include loan offers and other
credit facilities, guarantees and instruments not recognised in the balance sheet. If an instrument is likely to result in a payment obligation, a liability is
recognised under Other liabilities corresponding to the present value of expected payments.
(a) Guarantees
(DKK millions)
Financial guarantees
Other guarantees
Total
(b) Commitments
(DKK millions)
Loan commitments shorter than 1 year
Loan commitments longer than 1 year
Other unutilised commitments
Total
30 June
2023
31 December
2022
4,914
76,015
80,929
5,512
75,884
81,396
30 June
2023
31 December
2022
248,320
199,930
15,232
463,481
236,062
199,888
15,196
451,146
In addition to credit exposure from lending activities, loan offers made and uncommitted lines of credit granted by the Group amounted to DKK 195 billio n
(31 December 2022: DKK 216 billion). These items are included in the calculation of the total risk exposure amount in accordance with the CRR.
(c) Regulatory and legal proceedings
Estonia matter
As announced on 13 December 2022, Danske Bank has reached final coordinated resolutions with the US Department of Justice (DoJ), the US Securities
and Exchange Commission (SEC) and the Danish Special Crime Unit (SCU) following the investigations into failings and misconduct related to the non-resident
portfolio at Danske Bank’s former Estonia branch. The aggregate amounts payable to the US and Danish authorities were paid in January 2023. The coordi-
nated resolutions marked the end of the criminal and regulatory investigations into Danske Bank by the authorities in Denmark and the United States.
As part of the Bank’s agreement with DoJ, Danske Bank was placed on corporate probation for three years from 13 December 2022 until 13 December
2025 and Danske Bank committed to continue improving its compliance programs. Danske Bank has taken extensive remediation action to address those
failings to prevent any similar occurrences, and the Bank remains in contact with DoJ as a matter of post-resolution obligations set forth in the agreement
with DoJ.
The Bank remains subject to a criminal investigation by authorities in France and has posted bail in the amount of DKK 80 million. The Bank continues to
cooperate with the authorities.
The civil claims filed against Danske Bank by institutional investors can be summarised to six case complexes with a current total claim amount of approxi-
mately DKK 12.8 billion. One of the case complexes has partly been referred to the Eastern High Court, while the remaining case complexes are stayed or
pending before the Copenhagen City Court. The civil claims were not included in the coordinated resolutions with DoJ, SEC, and SCU. Danske Bank will continue
to defend itself vigorously against these claims. The timing of completion of such civil claims (pending or threatening) and their outcome are uncertain and
could be material.
Danske Bank has been procedurally notified in two claims filed against Thomas F. Borgen. Under Danish law, the purpose of a procedural notification is to
make a formal reservation of rights to bring a potential claim against the notified party. The first case was dismissed in the first instance and subsequently
appealed by the claimants. The original claim amount for both claims was approximately DKK 3.2 billion but has been reduced to approximately DKK 1.7
billion.
An action has been filed in the United States District Court for the Eastern District of New York against Danske Bank and others. The complaint sought
unspecified punitive and compensatory damages. On 29 December 2022, the action was dismissed by the court and on 27 January 2023, the complainants
filed an appeal of the dismissal. The timing of the completion of the lawsuit and the outcome are uncertain.
Other
Owing to its business volume, Danske Bank is continually a party to various other lawsuits and disputes, and has an ongoing dialogue with public authorities,
such as the Danish FSA and the Danish Tax Agency on other matters. In general, Danske Bank does not expect the outcomes of any of these other pending
lawsuits and disputes, or its dialogue with public authorities to have any material effect on its financial position. Provisions for litigations are included in Other
liabilities, see note G9.
Danske Bank / Interim report – first half 2023 58/88
Notes – Danske Bank Group
G11. Guarantees, commitments and contingent liabilities continued
(d) Further explanation
A limited number of employees are employed under terms which, if they are dismissed before reaching their normal retirement age, grant them a sever-
ance and/or pension payment in excess of their entitlement under ordinary terms of employment. As the sponsoring employer, the Group is also liable
for the pension obligations of a number of company pension funds.
The Group participates in the Danish Guarantee Fund and the Danish Resolution Fund. The funds’ capital must amount to at least 0.8% and 1%, respec-
tively, of the covered deposits of all Danish credit institutions by 31 December 2024. The Danish Guarantee Fund is currently fully funded, but if the fund
subsequently does not have sufficient means to make the required payments, extraordinary contributions of up to 0.5% of the individual institution ’ s
covered deposits may be required. Extraordinary contributions above this percentage require the consent of the Danish FSA. The first contribution to the
Danish Resolution Fund was made in December 2015. Danske Bank A/S and Realkredit Danmark A/S make contributions to the Resolution Fund on the
basis of their size and risk relative to other credit institutions in Denmark. The contribution to the Danish Resolution Fund is recognised as operatin g
expenses.
If the Resolution Fund does not have sufficient means to make the required payments, extraordinary contributions of up to three times the latest annual
contributions may be required. In addition, Danish banks participate in the Danish Restructuring Fund, which reimburses creditors if the final dividend is
lower than the interim dividend in respect of banks that were in distress before 1 June 2015. Similarly, Danish banks have made payment commitments
totalling DKK 1 billion to cover losses incurred by the Danish Restructuring Fund for the withdrawal of distressed banks from data centres etc. Payments
to the Danish Restructuring Fund are calculated on the basis of the individual credit institution’s share of covered deposits relative to other credit insti-
tutions in Denmark. However, each institution’s contribution to the Danish Restructuring Fund may not exceed 0.2% of its covered deposits.
The Group is a member of deposit guarantee schemes and other compensation schemes in Norway and the UK. As in Denmark, the contributions to the
schemes in these countries are annual contributions combined with extraordinary contributions if the means of the schemes are not sufficient to cover
the required payments.
Danske Bank A/S is taxed jointly with all Danish entities of Danske Bank Group and is jointly and severally liable with these for payment of Danish corpo-
ration tax and withholding tax, etc.
With effect from 1 April 2022, Danske Bank A/S is no longer registered jointly with all significant Danish entities of Danske Bank Group for financia l
services employer tax and VAT, for which Danske Bank A/S and the entities had been jointly and severally liable.
Danske Bank / Interim report – first half 2023 59/88
Notes – Danske Bank Group
G12. Assets provided or received as collateral
As at 30 June 2023, the Group had deposited securities (including bonds issued by the Group) worth DKK 47.0 billion as collateral with Danish and
international clearing centres and other institutions (31 December 2022: DKK 30.6 billion).
As at 30 June 2023, the Group had provided cash and securities (including bonds issued by the Group) worth DKK 77.8 billion as collateral for derivative s
transactions (31 December 2022: DKK 90.4 billion).
As at 30 June 2023, the Group had registered assets (including bonds and shares issued by the Group) under insurance contracts and unit-linke d
investment contracts worth DKK 431.7 billion (31 December 2022: DKK 417.5 billion) as collateral for policyholders’ savings of DKK 415.3 billion (31
December 2022: DKK 404.6 billion).
As at 30 June 2023, the Group had registered loans at fair value and securities (including bonds issued by the Group) worth a total of DKK 729.4 billio n
(31 December 2022: DKK 728.6 billion) as collateral for bonds issued by Realkredit Danmark. Similarly, the Group had registered loans and other assets
worth DKK 292.9 billion (31 December 2022: DKK 306.3 billion) as collateral for covered bonds issued under Danish, Finnish and Swedish law.
The table below shows assets provided as collateral for liabilities or contingent liabilities. Assets provided as collateral under repo transactions are
shown separately whereas the types explained above are included in the column ‘Other’.
30 June 2023
31 December 2022
(DKK millions)
Repo
Other
Total
Repo
Other
Total
Due from credit institutions
Trading and investment securities
Loans at fair value
Loans at amortised cost
Assets under insurance contracts and unit-
linked investment contracts
Other assets
-
218,616
-
-
-
-
28,517
60,598
724,994
304,900
409,201
-
28,517
279,214
724,994
304,900
409,201
-
-
139,807
-
-
-
-
22,917
72,697
724,051
328,800
347,673
93
22,917
212,504
724,051
328,800
347,673
93
Total
Own issued bonds
218,616
29,686
1,528,210
50,487
1,746,825
80,172
139,807
31,064
1,496,231
76,754
1,636,038
107,818
Total, including own issued bonds
248,301
1,578,696
1,826,998
170,871
1,572,985
1,743,856
Securities provided as collateral under agreements that entitle the counterparty to sell the securities or provide them as collateral for other loans
amounted to DKK 218.6 billion as at 30 June 2022 (31 December 2022: DKK 139.8 billion).
As at 30 June 2023, the Group had received securities worth DKK 309.9 billion (31 December 2022: DKK 303.8 billion) as collateral for reverse repo
transactions, securities lending, derivatives transactions and other transactions entered into on the standard terms for such transactions. As the party
receiving the collateral, the Group is entitled in most cases to sell the securities or provide the securities as collateral for other loans in exchange for
returning similar securities to the counterparty at the expiry of the transactions. As at 30 June 2023, the Group had sold securities or provided securities
as collateral worth DKK 123.1 billion (31 December 2022: DKK 119.2 billion).
The Group also receives many other types of assets as collateral in connection with its ordinary lending activities. The Group has not received the own-
ership of these assets. Note G41 of the Annual Report 2022 provide more details on assets received as collateral in connection with ordinary lending
activities.
Danske Bank / Interim report – first half 2023 60/88
Notes – Danske Bank Group
G13. Fair value information for financial instruments
Financial instruments are recognised in the balance sheet at fair value or amortised cost.
(DKK millions)
Financial assets
Cash in hand and demand deposits with central banks
Due from credit institutions and central banks
Trading portfolio assets
Investment securities
Loans at amortised cost
Loans at fair value
Assets under pooled schemes and
unit-linked investment contracts
Assets under insurance contracts
Loans held for sale
30 June 2023
31 December 2022*
Instruments held at
Fair value
Instruments held at
Amortised cost
Instruments held at
Fair value
Instruments held at
Amortised cost
-
76,556
559,305
134,729
-
903,801
67,820
450,986
-
231,516
28,598
-
153,548
910,422
-
-
-
120,361
-
38,147
638,799
135,850
-
932,677
66,739
465,720
-
175,052
22,639
-
151,573
1,082,818
-
-
-
-
Total
2,193,198
1,444,444
2,277,932
1,432,082
Financial liabilities
Due to credit institutions and central banks
Trading portfolio liabilities
Deposits
Issued bonds at fair value
Issued bonds at amortised cost
Deposits under pooled schemes and
unit-linked investment contracts
Liabilities held for sale
Non-preferred senior bonds
Subordinated debt
Loan commitments and guarantees
120,718
480,024
130,488
722,204
-
68,428
-
-
-
-
65,942
-
1,054,394
-
205,314
-
32,949
93,113
38,338
2,550
52,252
554,321
97,917
723,923
-
66,725
-
-
-
-
86,525
-
1,164,375
-
192,682
-
-
93,236
38,350
2,627
Total
1,521,862
1,492,600
1,495,138
1,577,795
* Comparative information has been restated, as described in note G2(a).
Liabilities under insurance contracts are measured using the General Measurement Model, Variable Fee Approach or Premium Allocation Approach as
defined by IFRS 17. Liabilities under insurance contracts are therefore not included in the table above.
Investment securities at fair value includes bonds measured at fair value through other comprehensive income, see the table on bonds in note G14. All
other financial assets in the column ‘Fair value’ are mandatorily measured at fair value through profit or loss under IFRS 9. Except for trading portfolio
liabilities, all other financial liabilities at fair value are measured at fair value through profit or loss using the fair value option.
Financial instruments at fair value
Note G33(a) of the Annual Report 2022 provides more information about fair value calculation methods for financial instruments.
Financial instruments valued on the basis of quoted prices in an active market are recognised in the Quoted prices category. Financial instruments value d
substantially on the basis of other observable input are recognised in the Observable input category. This category covers instruments such as derivative s
valued on the basis of observable yield curves and exchange rates and illiquid mortgage bonds valued by reference to the value of similar, liquid bonds.
Other financial instruments valued substantially on the basis of non-observable input are recognised in the Non-observable input category. This category
covers instruments such as unlisted shares, some unlisted bonds and a very limited portion of the derivatives portfolio.
If, at the balance sheet date, a financial instrument's classification differs from its classification at the beginning of the year, the classification of the
instrument changes. Changes are considered to have taken place at the balance sheet date. Developments in the financial markets have resulted in re-
classification between the categories. Some bonds have become illiquid and have therefore been moved from the Quoted prices to the Observable inpu t
category, while other bonds have become liquid and have been moved from the Observable input to the Quoted prices category. The amounts transferred
are insignificant.
Danske Bank / Interim report – first half 2023 61/88
Notes – Danske Bank Group
G13. Fair value information for financial instruments continued
Financial instruments at amortised cost
The liquidity portfolio managed by Group Treasury includes different portfolios with different business models (see note G13 in Annual Report 2022 for
further description of business models). Bonds held within a business model for the purpose of collecting contractual cash flows (hold to collect) and with
cash flows that are solely payments of principal and interest on the principal amount outstanding are measured at amortised cost. For bonds classified
as hold-to-collect, amortised cost exceeded fair value as at 30 June 2023 with DKK 11,828 million (31 December 2022: DKK 11,758 million). This
portfolio mainly contains Danish mortgage bonds and central and local government bonds and has a weighted average rating factor of 4.0, following
Moody’s numerical rating factor to scale, which corresponds to a strong Aa1 rating. The interest rate risk duration for the portfolio is 3.1 years. Withou t
any reinvestments, respectively 19%, 61% and 20% of this portfolio will reach maturity within a period of 1 year, between 1 to 5 years, and after 5 years.
The difference between amortised cost and fair value will reduce along with time to maturity of the bonds running off. Note G13 and G33 (b) in Annua l
Report 2022 provides information on the business models and the difference between the carrying amount and the fair value of financial instruments
recognised at amortised cost, respectively.
Danske Bank / Interim report – first half 2023 62/88
Notes – Danske Bank Group
G13. Fair value information for financial instruments continued
(DKK millions)
30 June 2023
Financial assets
Due from credit institutions and central banks
Derivatives
Trading portfolio bonds
Trading portfolio shares
Investment securities, bonds
Investment securities, shares
Loans at fair value
Assets under pooled schemes and unit-linked investment contracts
Assets under insurance contracts, bonds
Assets under insurance contracts, shares
Assets under insurance contracts, derivatives
Quoted prices
Observable
input
Non-observable
input
Total
-
6,756
158,146
8,660
103,943
-
-
67,820
175,271
142,425
933
76,556
366,541
17,882
-
30,260
-
903,801
-
27,459
4,927
61,457
-
1,217
-
103
-
525
-
-
2,868
34,889
757
76,556
374,515
176,028
8,763
134,203
525
903,801
67,820
205,598
182,241
63,147
Total
663,954
1,488,883
40,359
2,193,198
Financial liabilities
Due to credit institutions and central banks
Derivatives
Obligations to repurchase securities
Deposits
Issued bonds at fair value
Deposits under pooled schemes and unit-linked investment contracts
-
6,644
120,551
-
722,204
-
120,718
349,247
2,541
130,488
-
68,428
-
1,015
26
-
-
-
120,718
356,906
123,118
130,488
722,204
68,428
Total
849,399
671,422
1,041
1,521,862
(DKK millions)
31 December 2022*
Financial assets
Due from credit institutions and central banks
Derivatives
Trading portfolio bonds
Trading portfolio shares
Investment securities, bonds
Investment securities, shares
Loans at fair value
Assets under pooled schemes and unit-linked investment contracts
Assets under insurance contracts, bonds
Assets under insurance contracts, shares
Assets under insurance contracts, derivatives
Quoted prices
Observable input
Non-observable
input
-
6,942
183,205
8,198
97,209
-
-
66,739
188,260
124,338
817
38,147
421,917
17,190
-
37,454
-
932,677
-
23,834
4,788
72,406
-
1,263
-
83
-
1,187
-
-
3,369
47,045
863
Total
38,147
430,123
200,395
8,281
134,663
1,187
932,677
66,739
215,463
176,171
74,086
Total
675,708
1,548,413
53,810
2,277,932
Financial liabilities
Due to credit institutions and central banks
Derivatives
Obligations to repurchase securities
Deposits
Issued bonds at fair value
Deposits under pooled schemes and unit-linked investment contracts
-
4,967
113,830
-
723,923
-
52,252
429,138
5,327
97,917
-
66,725
Total
842,721
651,358
* Comparative information has been restated, as described in note G2(a).
-
1,036
23
-
-
-
1,059
52,252
435,141
119,180
97,917
723,923
66,725
1,495,138
Danske Bank / Interim report – first half 2023 63/88
Notes – Danske Bank Group
G13. Fair value information for financial instruments continued
Financial instruments valued on the basis of non-observable input
The tables below shows financial instruments valued on the basis of non-observable input.
(DKK millions)
30 June 2023
Unlisted shares
allocated to insurance contract policyholders
other
Illiquid bonds
Derivatives, net fair value
31 December 2022
Unlisted shares
allocated to insurance contract policyholders
other
Illiquid bonds
Derivatives, net fair value
Carrying amount
Increase
Decrease
Sensitivity (change in fair value)
Gains/losses for the period
Realised
Unrealised
34,889
602
2,868
959
47,045
1,247
3,369
1,090
-
60
60
-
-
125
67
-
-
60
60
-
-
125
67
-
935
318
1
-
6,423
175
-128
-
-1,086
-89
-114
-81
-706
-31
-61
-420
For unlisted shares allocated to insurance contract policyholders, the policyholders assume most of the risk on the shares. Therefore, changes in the fair
value of those shares will only to a limited extent affect the Group’s net profit. The Group’s remaining portfolio of unlisted shares consists primarily of
banking-related investments and holdings in private equity funds. The sensitivity of the fair value measurement to changes in the unobservable inpu t
disclosed in the table is calculated as a 10% increase or 10% decrease in fair value. Under current market conditions, a 10% decrease in the fair value
is considered to be below a possible alternative estimate of the fair value at the end of the period. The unrealised adjustments in the six month period
ended 30 June 2023 were attributable to various unlisted shares.
The estimated fair value of illiquid bonds depends significantly on the estimated credit spread. In the table, the sensitivity of the fair value measuremen t
to changes in non-observable input is calculated as a 50bps widening or narrowing of the credit spread.
A substantial number of derivatives valued on the basis of non-observable input are hedged by similar derivatives or are used for hedging the credit risk
on bonds also valued on the basis of non-observable input. Changing one or more of the non-observable inputs to reflect reasonable, possible alternative
assumptions would not change the fair value of the derivatives significantly above what is already covered by the reserve related to fair value adjustmen t
for model risk.
Shares, bonds and derivatives valued on the basis of non-observable input
Reconciliation from beginning to end of period
30 June 2023
31 December 2022
(DKK millions)
Shares
Bonds
Derivatives
Shares
Bonds
Derivatives
Fair value at 1 January
Value adjustment through profit or loss
Acquisitions
Sale and redemption
Transferred from quoted prices and observable input
Transferred to quoted prices and observable input
Fair value end of period
48,292
78
1,463
-14,342
-
-
35,492
3,369
-113
131
-519
-
-
2,868
1,090
-81
128
-250
-1
74
46,573
5,861
20,800
-24,942
-
-
5,300
-189
107
-1,849
-
-
2,504
-420
186
-42
-
-1,136
959
48,292
3,369
1,090
The value adjustment through profit or loss is recognised under Net trading income or loss. The transfer of derivatives to the Observable input category
consists primarily of maturity reductions, implying that the yield curves have become observable.
Danske Bank / Interim report – first half 2023 64/88
Notes – Danske Bank Group
G14. Risk management notes
The consolidated financial statements for 2022 provide a detailed description of the Group’s risk management practices.
Breakdown of credit exposure
Lending activities
Total
Core
Non-core
Counterparty
credit risk
Trading and
investment
securities
Customer-
funded
investments
(DKK billions)
30 June 2023
Balance sheet items
Demand deposits with central banks
Due from credit institutions and central banks
Trading portfolio assets
Investment securities
Loans at amortised cost
Loans at fair value
Assets under pooled schemes and unit-linked investment contracts
Assets under insurance contracts
Assets held for sale
Off-balance-sheet items
Guarantees
Loan commitments shorter than 1 year
Loan commitments longer than 1 year
Other unutilised commitments
Total
31 December 2022*
Balance sheet items
Demand deposits with central banks
Due from credit institutions and central banks
Trading portfolio assets
Investment securities
Loans at amortised cost
Loans at fair value
Assets under pooled schemes and unit-linked investment contracts
Assets under insurance contracts
Assets held for sale
Off-balance-sheet items
Guarantees
Loan commitments shorter than 1 year
Loan commitments longer than 1 year
Other unutilised commitments
224.7
105.2
559.3
288.3
910.4
903.8
67.8
502.5
120.4
80.9
248.3
199.9
15.2
224.7
28.6
-
-
909.3
725.0
-
-
120.4
80.9
247.0
199.9
-
4,226.7
2,535.7
168.4
60.8
638.8
287.5
1,082.8
932.7
66.7
503.0
-
81.4
236.1
199.9
15.2
168.4
22.7
-
-
1,081.7
724.1
-
-
-
81.4
234.8
199.9
-
-
-
-
-
1.1
-
-
-
-
-
1.3
-
-
2.5
-
-
-
-
1.2
-
-
-
-
-
1.3
-
-
2.5
-
76.6
374.5
-
-
178.8
-
-
-
-
-
-
-
-
-
184.8
288.3
-
-
-
-
-
-
-
-
0.1
-
-
-
-
-
-
67.8
502.5
-
-
-
-
15.2
629.9
473.1
585.5
-
38.1
430.1
-
-
208.6
-
-
-
-
-
-
-
-
-
208.7
287.5
-
-
-
-
-
-
-
-
0.1
-
-
-
-
-
-
66.7
503.0
-
-
-
-
15.1
676.9
496.2
584.8
Total
4,273.2
2,512.8
* Comparative information has been restated, as described in note G2(a).
In addition to credit exposure from lending activities, Danske Bank had made uncommitted loan offers and granted uncommitted lines of credit of DKK
195 billion at 30 June 2023 (31 December 2022: DKK 216 billion). These items are included in the calculation of the total risk exposure amount in
accordance with the Capital Requirements Directive.
Danske Bank / Interim report – first half 2023 65/88
Notes – Danske Bank Group
Credit exposure
Credit exposure from core lending activities
Credit exposure from lending activities in the Group’s core banking business includes loans, amounts due from credit institutions and central banks,
guarantees and irrevocable loan commitments. The exposure is measured net of expected credit losses and includes repo loans at amortised cost. For
reporting purposes, all collateral values are net of haircuts and capped at the exposure amount. The credit exposure from Non-core lending activities is
disclosed further on in these notes.
The Group’s definition of default for accounting aligns with the regulatory purposes. All exposures in stage 3 are considered default. This includes all non-
performing loans. A small amount of credit exposure in stage 3 can be found outside default. This is due to impairment staging being updated monthly
(after each month-end), whereas default is updated daily. For the same reason, some credit exposure in default is outside stage 3. The stage 3 coverage
ratio is 78% (31 December 2022: 85%).
For further details about the Group’s credit risk management and the use of information on expected credit losses for risk management purposes, see
Risk Management 2022.
Credit portfolio in core activities broken down by rating category and stages
The table below breaks down the credit exposure by rating categories and stages. Further information on classification of customers can be found on
page 173 in Annual report 2022.
30 June 2023
(DKK billions)
PD level
Upper Lower
Gross exposure
Expected credit loss
Net exposure
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3
Stage 1 Stage 2 Stage 3
Net exposure, ex collateral
Stage 1 Stage 2 Stage 3
1
2
3
4
5
6
7
8
9
10
11 (default)
Total
0.01
-
0.03
0.01
0.06
0.03
0.14
0.06
0.31
0.14
0.63
0.31
1.90
0.63
1.90
7.98
7.98 25.70
25.70 99.99
100.00 100.00
110.3
301.4
535.5
614.6
456.6
261.3
82.4
11.7
1.0
0.3
0.1
0.1
0.1
0.6
1.4
7.9
43.0
48.9
27.8
6.1
13.7
0.3
-
-
-
-
-
-
0.1
0.1
0.1
0.4
29.3
-
-
0.1
0.5
0.4
0.6
1.0
0.7
-
-
-
-
-
-
-
0.1
0.8
2.0
3.1
0.8
1.2
-
-
-
-
-
-
-
-
-
-
0.2
7.9
110.3
301.4
535.4
614.1
456.2
260.7
81.3
11.0
1.0
0.3
0.1
0.1
0.1
0.6
1.4
7.8
42.1
46.9
24.7
5.3
12.6
0.3
-
-
-
-
-
-
0.1
-
0.1
0.3
21.4
91.5
193.2
263.0
294.7
148.6
91.1
25.9
2.4
0.2
-
-
-
-
0.3
0.4
4.8
20.9
15.5
4.7
2.3
3.6
0.1
-
-
-
-
-
-
-
-
-
0.1
2.1
2,375.3
149.9
29.9
3.4
8.0
8.0
2,371.9
141.9
21.9
1,110.7
52.7
2.3
31 December 2022
(DKK billions)
PD level
Gross exposure
Expected credit loss
Net exposure
Net exposure, ex collateral*
Upper
Lower Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3
1
2
3
4
5
6
7
8
9
10
11 (default)
Total
-
0.01
0.03
0.06
0.14
0.31
0.63
1.90
7.98
25.70
0.01
0.03
0.06
0.14
0.31
0.63
1.90
7.98
25.70
99.99
100.00 100.00
135.9
233.5
540.9
630.6
463.1
235.8
75.5
7.3
0.9
0.6
0.2
0.1
0.2
0.8
1.9
14.0
54.3
59.5
29.9
3.1
12.0
0.4
-
-
-
-
-
-
-
-
0.1
0.2
31.6
-
-
0.1
0.6
0.4
0.5
0.9
0.4
-
-
0.3
-
-
-
-
0.1
0.9
2.6
2.8
0.7
0.9
-
-
-
-
-
-
0.1
-
-
-
0.1
8.1
135.9
233.5
540.8
630.0
462.7
235.3
74.6
6.8
0.9
0.6
-
0.1
0.2
0.8
1.9
13.9
53.3
56.9
27.0
2.4
11.1
0.4
-
-
-
-
-
-
-
-
0.1
0.1
23.5
115.2
116.8
262.9
298.0
148.1
76.1
24.2
1.7
0.2
0.3
-
-
0.1
0.3
0.9
7.7
21.4
20.7
4.3
0.2
2.1
0.1
-
-
-
-
-
-
-
-
0.1
-
1.3
2,324.2
176.0
32.1
3.3
8.1
8.3
2,321.0
168.0
23.9 1,043.5
58.0
1.4
*Net exposure, ex collateral as at 31 December 2022 has been restated.
Danske Bank / Interim report – first half 2023 66/88
Notes – Danske Bank Group
Credit exposure continued
Credit portfolio in core activities broken down by industry (NACE) and stages
The table below breaks down credit exposure by industry. The industry segmentation is based on the classification principles of the Statistical Classifi-
cation of Economic Activities in the European Community (NACE) standard that has been adapted to the Group’s business risk approach used for the
active management of the credit portfolio.
30 June 2023
(DKK billions)
Gross exposure
Expected credit loss
Net exposure
Net exposure, ex collateral
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3
Public institutions
Financials
Agriculture
Automotive
Capital goods
Commercial property*
Construction and building materials
Consumer goods
Hotels, restaurants and leisure
Metals and mining
Other commercials
Pharma and medical devices
Private housing co-ops and
non-profit associations
Pulp, paper and chemicals
Retailing
Services
Shipping, oil and gas
Social services
Telecom and media
Transportation
Utilities and infrastructure
Personal customers
272.5
144.7
54.1
26.4
88.4
248.1
44.6
76.9
11.8
15.2
11.5
53.2
186.7
42.1
29.7
60.4
37.0
26.8
19.8
14.4
85.3
826.0
1.0
2.9
5.0
2.7
9.4
40.1
7.3
7.3
2.5
0.7
0.5
3.0
4.1
3.7
4.0
7.3
1.0
0.9
3.0
2.4
2.9
38.4
0.3
0.3
2.6
0.2
1.6
2.8
1.2
1.3
0.8
-
0.3
-
0.6
0.3
1.8
0.7
3.9
0.7
0.2
0.3
-
10.1
-
-
0.3
-
0.1
0.5
0.3
0.1
-
-
0.1
-
0.1
-
0.1
0.2
-
-
-
-
0.1
1.4
-
0.1
0.8
0.1
0.2
2.0
0.7
0.5
0.1
-
-
-
0.3
0.1
0.4
0.3
-
0.1
0.1
0.1
0.2
1.8
-
0.1
0.7
0.1
0.6
0.7
0.5
0.4
0.2
-
0.1
-
0.1
0.1
0.5
0.3
0.7
0.1
0.1
0.1
-
2.6
272.5
144.6
53.8
26.3
88.3
247.5
44.3
76.8
11.8
15.2
11.3
53.2
186.7
42.0
29.7
60.2
37.0
26.7
19.8
14.4
85.1
824.6
1.0
2.8
4.2
2.6
9.1
38.1
6.6
6.9
2.4
0.6
0.5
2.9
3.8
3.6
3.6
7.0
0.9
0.8
2.9
2.3
2.7
36.7
0.3
0.2
1.8
0.1
1.0
2.1
0.7
0.9
0.6
-
0.2
-
0.5
0.2
1.3
0.4
3.2
0.6
0.1
0.2
-
7.5
269.9
128.8
13.2
21.4
80.1
38.7
31.7
62.1
2.9
13.0
7.9
50.6
28.0
31.1
19.3
50.5
22.0
11.7
14.9
6.4
64.8
141.8
-
2.2
0.8
1.5
7.4
5.7
3.9
5.0
0.8
0.4
0.1
2.5
0.7
2.7
2.8
5.6
0.4
0.4
2.2
0.7
2.4
4.4
-
0.2
-
-
0.1
0.1
0.2
0.3
0.1
-
-
-
0.1
-
0.5
-
-
0.4
-
-
-
-
Total
2,375.3
149.9
29.9
3.4
8.0
8.0
2,371.9
141.9
21.9 1,110.7
52.7
2.3
*As at 30 June 2023, DKK 133 billion of the net exposure in Commercial property is towards residential assets.
As at 30 June 2023, oil and gas exposures (within the Shipping, oil and gas industry) represent a gross exposure of DKK 19.4 billion (31 December
2022: DKK 19.3 billion) and expected credit losses of DKK 0.5 billion (31 December 2022: DKK 0.7 billion). Those exposures represent the majority of
the exposures in stage 3 within the Shipping, oil and gas industry at the end of June 2023.
Danske Bank / Interim report – first half 2023 67/88
Notes – Danske Bank Group
Credit exposure continued
31 December 2022
(DKK billions)
Gross exposure
Expected credit loss
Net exposure
Net exposure, ex collateral*
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3
Public institutions
Financials
Agriculture
Automotive
Capital goods
Commercial property
Construction and building materials
Consumer goods
Hotels, restaurants and leisure
Metals and mining
Other commercials
Pharma and medical devices
Private housing co-ops and
non-profit associations
Pulp, paper and chemicals
Retailing
Services
Shipping, oil and gas
Social services
Telecom and media
Transportation
Utilities and infrastructure
Personal customers
225.8
116.6
54.9
25.4
87.3
250.6
43.6
72.4
10.3
13.9
15.4
42.3
187.4
47.5
30.3
59.7
34.6
26.9
23.1
13.7
103.4
839.3
1.3
3.9
5.9
2.3
9.2
46.9
8.6
7.6
4.2
1.1
0.8
3.7
3.8
3.9
3.1
6.8
1.2
0.8
1.0
2.6
4.3
52.8
-
0.3
2.9
0.2
1.3
3.6
1.2
0.9
1.0
-
0.2
-
0.6
0.3
1.7
0.8
5.4
0.7
0.2
0.5
-
10.3
-
0.1
0.2
-
0.1
0.4
0.1
0.1
-
-
0.3
-
0.1
-
0.1
0.3
-
-
-
-
0.1
1.2
-
0.2
0.9
0.1
0.3
2.2
0.5
0.4
0.1
-
-
0.1
0.1
0.1
0.1
0.2
-
0.1
-
0.1
0.2
2.0
-
0.1
0.8
0.1
0.7
0.7
0.5
0.2
0.3
-
0.1
-
0.1
0.1
0.6
0.3
1.0
0.1
0.1
0.1
-
2.3
225.8
116.5
54.6
25.4
87.2
250.3
43.5
72.3
10.3
13.9
15.1
42.2
187.3
47.5
30.2
59.4
34.6
26.8
23.1
13.6
103.2
838.1
1.3
3.7
5.1
2.2
8.9
44.7
8.1
7.2
4.0
1.1
0.8
3.6
3.7
3.8
3.0
6.6
1.2
0.7
0.9
2.4
4.1
50.8
-
0.2
2.1
0.1
0.7
2.9
0.7
0.6
0.8
-
0.2
-
0.5
0.1
1.1
0.4
4.4
0.6
0.1
0.3
-
8.0
223.1
104.0
14.1
20.7
79.0
44.9
32.4
57.1
5.1
11.8
11.9
39.6
26.9
35.8
19.0
49.1
22.5
12.9
17.8
6.3
80.4
129.2
-
2.7
0.8
0.9
7.2
7.9
4.6
5.2
0.8
0.8
0.3
3.2
0.8
2.7
2.2
4.8
0.9
0.3
0.6
0.9
3.6
7.0
-
0.1
-
-
-
-
0.1
0.3
0.1
-
-
-
-
-
0.2
0.1
-
-
-
0.1
-
-
Total
2,324.2 176.0
32.1
3.3
8.1
8.3 2,321.0
168.0
23.9 1,043.5
58.0
1.4
*Net exposure, ex collateral as at 31 December 2022 has been restated.
Collateral
The Group uses a number of measures to mitigate credit risk, including collateral, guarantees and covenants. The main method is obtaining collateral. In
Annual Report 2022, a table showing collateral by type (after haircut) is included. The mitigating effect from collateral at the end of June 2023 can be
found as the difference between the columns ‘Net exposure’ and ‘Net exposure, ex collateral’ and amounted to DKK 1,370.0 billion at 30 June 2023 (31
December 2022: DKK 1,409.9 billion).
Danske Bank / Interim report – first half 2023 68/88
Notes – Danske Bank Group
Credit exposure continued
The table below breaks down credit exposure by core business unit and underlying segment.
Gross exposure
Expected credit loss
Net exposure
Net exposure, ex collateral
Stage 1
Stage 2 Stage 3
Stage 1
Stage 2 Stage 3
Stage 1
Stage 2 Stage 3
Stage 1
Stage 2 Stage 3
413.7
18.6
6.0
1.0
1.3
1.3
412.7
17.4
4.7
53.2
1.7
319.0
77.3
12.7
3.2
2.9
0.6
0.2
-
0.3
0.1
0.9
0.2
318.8
77.2
12.3
3.1
2.0
0.4
74.1
18.0
1.4
1.1
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
810.0
34.5
9.5
1.3
1.7
2.4
808.7
32.8
7.1
145.4
4.2
0.1
51.0
302.8
300.4
10.1
41.0
28.0
1.2
10.7
1.0
0.1
1.0
0.2
0.4
3.0
1.3
0.4
3.6
0.3
50.9
301.8
300.2
9.7
37.9
26.7
0.8
7.2
0.7
19.4
103.2
53.2
2.1
13.9
4.0
-
1.0
-
0.3
-
-
-
-
-
0.3
-
-
0.3
-
-
654.6
79.1
12.9
1.4
4.8
4.2
653.2
74.4
8.7
176.1
20.0
1.1
618.9
31.7
6.0
Northern Ireland
90.6
4.5
1.5
Group Functions
201.1
0.1
-
0.5
0.3
-
1.4
1.0
618.5
30.4
5.0
537.8
27.7
1.2
0.1
0.4
90.4
4.4
1.1
50.3
-
-
201.1
0.1
-
201.0
0.7
0.1
-
-
Total
2,375.3
149.9
29.9
3.4
8.0
8.0
2,371.9
141.9
21.9
1,110.7
52.7
2.3
Gross exposure
Expected credit loss
Net exposure
Stage 1
Stage 2 Stage 3
Stage 1
Stage 2 Stage 3
Stage 1
Stage 2 Stage 3
Net exposure, ex collateral*
Stage 1
Stage 2 Stage 3
404.3
25.5
6.1
0.9
1.4
1.2
403.3
24.0
4.9
45.8
2.2
349.4
76.1
15.9
7.1
3.2
0.6
0.2
0.1
0.3
0.2
0.8
0.2
349.2
76.0
15.6
6.9
2.4
0.4
72.2
16.0
2.0
2.9
-
-
-
-
-
-
-
-
-
-
-
829.8
48.5
9.9
1.3
2.0
2.2
828.5
46.5
7.7
134.1
7.1
-
-
-
-
-
47.6
324.0
279.1
12.9
56.4
22.1
1.2
11.1
1.3
0.1
0.9
0.2
0.5
3.9
0.6
0.3
3.5
0.3
47.4
323.1
278.9
12.4
52.5
21.5
0.8
7.5
1.0
18.6
119.7
43.4
2.4
17.8
3.9
-
1.0
0.2
0.1
-
-
-
-
-
0.1
-
-
0.1
-
-
650.7
91.4
13.6
1.2
4.9
4.2
649.5
86.4
9.4
181.7
24.1
1.2
615.2
29.1
7.0
Northern Ireland
81.4
6.9
1.7
Group Functions
147.1
0.2
-
0.5
0.3
-
1.0
1.5
614.7
28.1
5.5
535.3
25.5
-
0.2
0.4
81.1
6.7
1.2
45.4
1.1
0.1
-
-
147.1
0.2
-
146.9
0.2
-
Total
2,324.2
176.0
32.1
3.3
8.1
8.3
2,321.0
168.0
23.9
1,043.5
58.0
1.4
* Net exposure, ex collateral as at 31 December 2022 has been restated.
** Global Private Banking is a new sub-segment in Personal Customers in 2023. Comparatives have been reclassified from other sub-segments of Personal Customers.
30 June 2023
(DKK billions)
Personal Customers
Personal Customers
Denmark
Personal Customers
Nordic
Global Private Banking
Personal Customers
Other
Total
Personal Customers
Business Customers
Asset Finance
Business Customers
Commercial Real Estate
Business Customers
Other
Total
Business Customers
Large Corporates &
Institutions
31 December 2022
(DKK billions)
Personal Customers**
Personal Customers DK
Personal Customers
Nordic
Global Private Banking
Personal Customers
Other
Total
Personal Customers
Business Customers
Asset Finance
Business Customers
Commercial Real Estate
Business Customers
Other
Total
Business Customers
Large Corporates &
Institutions
Danske Bank / Interim report – first half 2023 69/88
Notes – Danske Bank Group
Credit exposure continued
Exposures subject to forbearance measures
The Group adopts forbearance plans to assist customers in financial difficulty. Concessions granted to customers include interest-reduction schedules,
interest-only schedules, temporary payment holidays, term extensions, cancellation of outstanding fees, waiver of covenant enforcement and debt
forgiveness. Forbearance plans must comply with the Group’s Credit Policy. They are used as an instrument to retain long-term business relationships
during economic downturns if there is a realistic possibility that the customer will be able to meet its obligations again, or are used for minimising losses
in the event of default.
If it proves impossible to improve the customer’s financial situation by forbearance measures, the Group will consider whether to subject the customer’s
assets to a forced sale or whether the assets could be realised later at higher net proceeds. At the end of the first half of 2023, the Group had recognised
properties taken over in Denmark at a carrying amount of DKK 5 million (31 December 2022: DKK 4 million), and there were no properties taken over in
other countries (31 December 2022: DKK 0 million). The properties are held for sale and included under Assets held for sale in the balance sheet.
The Group applies the European Banking Authority’s (the EBA’s) definition of loans subject to forbearance measures. The EBA definition states that a
probation period of a minimum of two years must pass from the date when forborne exposures are considered to be performing again. Forbearance
measures lead to changes in staging for impairment purposes, and impairments relating to forborne exposures are handled according to the principles
described in note G15 in Annual Report 2022.
Exposures subject to forbearance measures
(DKK millions)
Stage 1
Stage 2
Stage 3
Total
30 June
2023
31 December
2022
110
4,954
7,014
12,079
367
3,029
6,165
9,561
Notes – Danske Bank Group
Credit exposure continued
Allowance account in core activities
(DKK millions)
ECL allowance account as at 1 January 2022
Transferred to stage 1 during the period
Transferred to stage 2 during the period
Transferred to stage 3 during the period
ECL on new assets
ECL on assets derecognised
Impact of net remeasurement of ECL (incl. changes in models)
Write-offs debited to the allowance account
Foreign exchange adjustments
Other changes
Danske Bank / Interim report – first half 2023 70/88
Stage 1
Stage 2
Stage 3
Total
2,733
859
-305
-18
476
-470
-176
-
-15
-16
6,804
-806
626
-364
636
-745
721
-2
-65
-31
12,397
-54
-321
382
980
-3,049
1,488
-1,945
59
-9
21,935
-
-
-
2,092
-4,263
2,033
-1,947
-21
-57
ECL allowance account as at 30 June 2022
3,067
6,774
9,930
19,772
ECL allowance account as at 1 January 2023
3,273
8,082
8,251
19,605
Transferred to stage 1 during the period
Transferred to stage 2 during the period
Transferred to stage 3 during the period
ECL on new assets
ECL on assets derecognised
Impact of net remeasurement of ECL (incl. changes in models)
Write-offs debited to the allowance account
Foreign exchange adjustments
Other changes
1,548
-179
-12
332
-234
-1,289
-
-37
-
-1,485
368
-297
926
-784
1,321
-
-167
-6
-63
-189
309
303
-477
171
-180
-95
10
-
-
-
1,562
-1,495
203
-180
-299
4
ECL allowance account as at 30 June 2023
3,402
7,957
8,041
19,400
Danske Bank / Interim report – first half 2023 71/88
Notes – Danske Bank Group
Credit exposure continued
Allowance account in core activities broken down by segment
(DKK millions)
Personal
Customers
Business
Customers
Large
Corporates &
Institutions
Northern
Ireland
Group
Functions
Allowance
account
Total
ECL allowance account as at 1 January 2022
ECL on new assets
ECL on assets derecognised
Impact on remeasurement of ECL (incl. change in models)
Write-offs debited to allowance account
Foreign currency translation
Other changes
5,654
290
-430
394
-73
-18
15
10,186
1,043
-1,227
350
-445
-90
-46
5,227
734
-2,542
1,196
-1,311
105
-23
ECL allowance account as at 30 June 2022
5,831
9,772
3,385
ECL allowance account as at 1 January 2023
5,427
10,235
3,050
ECL on new assets
ECL on assets derecognised
Impact on remeasurement of ECL (incl. change in models)
Write-offs debited to allowance account
Foreign currency translation
Other changes
321
-381
190
-54
-45
-14
942
-1,054
390
-88
-199
19
283
-34
-278
-32
-83
-
ECL allowance account as at 30 June 2023
5,443
10,246
2,907
850
23
-64
86
-118
-16
-1
760
863
19
-22
-112
-7
30
1
771
The method used for calculating expected credit losses is described in detail in note G15 of the Annual Report 2022.
17
2
-1
7
-
-
-1
24
31
-4
-4
14
-
-2
-2
33
21,935
2,092
-4,263
2,033
-1,947
-21
-57
19,772
19,605
1,562
-1,495
203
-180
-299
4
19,400
Forward-looking information
The incorporation of forward-looking information reflects the expectations of the Group’s senior management and involves both macroeconomic scenar-
ios (base case, upside and downside scenarios), including an assessment of the probability for each scenario, and post-model adjustments. The purpose
of using multiple scenarios is to model the non-linear impact of assumptions about macroeconomic factors on the expected credit losses. Post-model
adjustments are used to capture specific risks which are not fully covered by the macroeconomic scenarios, as well as the process related risk, which
could lead to an underestimation of the expected credit losses.
Macro e co n o mic scenario s
The forward-looking information is based on a three-year forecast period converging to steady state in year seven. That is, after the forecast period, the
macroeconomic scenarios revert slowly towards a steady state.
The applied scenarios that drive the expected credit loss calculation in the first half of 2023 have been updated with the latest macroeconomic data.
Compared to the end of 2022, the base case and upside scenarios have been revised to reflect expectations of higher inflation, declining house prices
and interest rate hikes. The scenario weighting have been updated to increase the weight on the upside scenario to 20% (10% in 2022), by decreasing
the weight on the base case scenario to 60% (70% in 2022). The weight on the downside scenario remains at 20% (20% in 2022) despite the use of a
severe stagflation scenario.
The base case is an extension of the Group’s official view of the Nordic economies (the Nordic Outlook report). At 30 June 2023, the base case sce-
nario reflects an expectation of high inflation and high interest rates. This results in a slowdown in the Nordic economies with a weaker GDP growth.
House prices are expected to decline in 2023, but the development is expected to turn from 2024 in most countries.
The upside scenario represents a slightly better outlook than the base case scenario across the macroeconomic parameters. In this scenario, the
global inflation declines which allows the central banks to ease the tightening pace, which lowers bond yields and boosts equity markets.
In the fourth quarter of 2022, the downside scenario was changed to the severe recession with high interest rates scenario (reflecting a stagflatio n
scenario) applied in the Group’s ICAAP processes, and is similar in nature to regulatory stress tests. The severe recession scenario reflected negative
growth, increasing interest rates, and falling property prices for a longer period. The change of the downside scenario was made to better capture the
increasing risk from high interest rates and high inflation. A trigger of the economic setback could be continued macroeconomic worsening and challenges
linked to high business costs while inflation remain elevated. This adversely impacts the labour market, results in higher and more persistent unemploy-
ment. This would lead to a severe slowdown in the economies in which the Group is represented.
The main macroeconomic parameters in the base case, upside and downside scenario entering into the ECL calculation for the forecast horizon across
the Group’s Nordic markets are included below.
Danske Bank / Interim report – first half 2023 72/88
Notes – Danske Bank Group
Credit exposure continued
Denmark
30 June 2023
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Sweden
30 June 2023
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Norway
30 June 2023
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Finland
30 June 2023
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Base-case
2024
2023
2025
Downside
2024
2023
2025
2023
Upside
2024
2025
0.5
3.1
5.1
-9.5
3.6
1.3
3.6
3.6
-3.5
2.6
1.5
3.9
2.2
2.5
1.6
-3.7
6.0
4.0
-19.7
3.3
-2.1
7.0
3.0
-12.7
4.3
-
7.4
2.0
-8.0
3.8
1.2
2.9
4.1
-9.5
3.1
2.8
3.0
2.9
-0.5
2.1
1.0
3.3
2.8
4.5
1.6
Base-case
2024
2023
2025
Downside
2024
2023
2025
2023
Upside
2024
2025
-1.2
8.0
9.6
-14.0
4.0
1.7
7.9
2.3
2.0
3.0
1.8
7.5
1.7
2.0
2.0
-3.8
8.9
4.9
-23.6
3.8
-3.6
9.9
3.9
-14.6
4.8
-1.0
10.3
2.9
-10.0
4.3
-0.7
7.9
9.0
-14.0
3.5
2.9
7.6
1.7
5.0
2.5
1.8
7.2
1.7
4.0
2.0
Base-case
2024
2023
2025
Downside
2024
2023
2025
2023
Upside
2024
2025
1.0
2.1
4.8
-3.0
3.3
1.5
2.4
2.5
0.5
2.8
1.5
2.5
1.8
3.5
2.5
-2.9
5.2
4.5
-20.5
4.4
-1.2
6.1
3.0
-14.5
5.4
0.6
6.2
2.0
-8.0
4.9
1.5
2.0
3.7
-3.0
2.8
2.1
2.2
1.7
3.5
2.3
1.3
2.3
2.3
4.5
2.5
Base-case
2024
2023
2025
Downside
2024
2023
2025
2023
Upside
2024
2025
-0.2
7.0
5.5
-5.5
4.0
0.9
6.8
2.1
4.0
3.0
1.3
6.5
2.0
2.0
2.0
-2.7
9.4
4.0
-14.2
3.2
-2.2
10.4
3.0
-9.2
4.2
-0.3
10.4
2.0
-5.0
3.7
0.3
6.9
4.8
-5.5
3.5
2.1
6.6
1.4
6.0
2.5
1.2
6.3
2.1
3.0
2.0
Danske Bank / Interim report – first half 2023 73/88
Notes – Danske Bank Group
Credit exposure continued
At 31 December 2022, the following base case and downside scenarios were used:
Denmark
31 December 2022
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Sweden
31 December 2022
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Norway
31 December 2022
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Finland
31 December 2022
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Base-case
2024
2023
2025
Downside
2024
2023
2025
2023
Upside
2024
2025
-0.6
3.2
4.9
-5.9
2.8
0.5
3.8
2.5
-4.0
2.5
1.5
3.8
1.8
1.5
2.0
-3.7
6.0
4.0
-19.7
3.3
-2.1
7.0
3.0
-12.7
4.3
-
7.4
2.0
-8.0
3.8
0.4
3.0
4.0
-2.9
2.3
1.6
3.3
1.9
-2.0
1.8
1.1
3.3
1.9
2.5
1.8
Base-case
2024
2023
2025
Downside
2024
2023
2025
2023
Upside
2024
2025
-1.2
8.2
6.2
-8.0
2.8
1.1
8.0
1.5
-
2.5
1.8
7.5
1.7
2.0
2.0
-3.8
8.9
4.9
-23.6
3.8
-3.6
9.9
3.9
-14.6
4.8
-1.0
10.3
2.9
-10.0
4.3
-0.6
8.2
5.4
-5.0
2.3
2.1
7.8
0.9
2.0
1.8
1.7
7.3
1.3
3.0
1.8
Base-case
2024
2023
2025
Downside
2024
2023
2025
2023
Upside
2024
2025
0.9
2.4
3.4
-2.1
3.1
1.7
2.5
1.8
2.0
2.9
1.5
2.2
2.0
2.5
2.4
-2.9
5.2
4.5
-20.5
4.4
-1.2
6.1
3.0
-14.5
5.4
0.6
6.2
2.0
-8.0
4.9
1.5
2.3
2.4
0.9
2.6
2.5
2.2
1.3
3.0
2.1
1.7
1.9
1.9
3.5
2.1
Base-case
2024
2023
2025
Downside
2024
2023
2025
2023
Upside
2024
2025
-0.2
7.3
3.7
-1.0
2.6
1.0
7.4
2.1
1.0
2.3
1.3
7.0
1.8
2.0
1.8
-2.7
9.4
4.0
-14.2
3.2
-2.2
10.4
3.0
-9.2
4.2
-0.3
10.4
2.0
-5.0
3.7
0.5
7.3
2.9
1.0
2.1
2.0
7.3
1.4
2.0
1.6
1.3
6.9
1.6
3.0
1.6
The base case scenario enters with a probability of 60% (31 December 2022: 70%), the upside scenario with a probability of 20% (31 December 2022:
10%) and the downside scenario with a probability of 20% (31 December 2022: 20%). On the basis of these assessments, the allowance account as at
30 June 2023 amounted to DKK 19.4 billion (31 December 2022: 19.6 billion). If the base case scenario was assigned a probability of 100%, the
allowance account would decrease DKK 1.5 billion (31 December 2022: 2.1 billion). Compared to the base case scenario, the allowance account would
increase DKK 8.0 billion (31 December 2022: 10.9 billion), if the downside scenario was assigned a probability of 100%. The increase reflects primarily
the transfer of exposures from stage 1 to stage 2 and increased expected credit losses within stage 2. If instead the upside scenario was assigned a
probability of 100%, the allowance account would decrease by DKK 0.6 billion (31 December 2022: 0.4 billion) compared to the base case scenario. It
should be noted that the expected credit losses in the individual scenarios (i.e. without the weighting) do not represent forecasts of expected credit losses
(ECL).
Danske Bank / Interim report – first half 2023 74/88
Notes – Danske Bank Group
Credit exposure continued
Post-model adjustments
Management applies judgement when determining the need for post-model adjustments. At 30 June 2023, the post-model adjustments amounted to
DKK 6.8 billion (31 December 2022: 6.6 billion). The post-model adjustments primarily relate to the following types of risks:
•
specific macroeconomic risks on certain industries not fully captured by the expected credit loss model, for instance the Agriculture industry. For
such industries, supplementary calculations are made to ensure sufficient impairment coverage. This also includes post-model adjustments relating
to secondary effects from the war in Ukraine or the macroeconomic uncertainty.
non-linear downside risk, for instance on the property market in Copenhagen and other high growth areas for which the macroeconomic forecasts
used in the models are based on the property market as a whole.
portfolios where the credit risk assessment process has identified an underestimation of the expected credit losses.
•
•
Following the significant impact on the expected credit losses from post-model adjustments, the table below provides more information about the adjust-
ments.
Post-model adjustments by type and mostly impacted industries
(DKK billions)
Coverage of individual industries and types
Agriculture
Commercial Property
Construction and building materials
Personal customers (including other retail exposures)
Others*
Total
30 June
2023
31 December
2022
0.8
1.8
0.7
1.6
1.8
6.8
0.8
1.8
0.5
1.4
2.1
6.6
*No individual industry included in Others exceeds DKK 0.3 billion at 30 June 2023 (31 December 2022: DKK 0.3 billion).
In first half of 2023, the total balance of post-model adjustments displayed a very modest increase compared to the end of 2022.
The Group continues to have significant post-model adjustments related to the current macroeconomic uncertainties characterised by the slowing
growth environment, labour shortages, interest rate hikes and inflation giving rise to a new set of challenges that affect economic and business activity.
The post-model adjustments cut across industries that are sensitive to price rises on energy, e.g. agriculture and metals, and industries vulnerable to
business cycles and increasing interest rates, which have been assessed for idiosyncratic risks to ensure a prudent coverage of expected credit loss in
the Group’s portfolios.
Danske Bank / Interim report – first half 2023 75/88
Notes – Danske Bank Group
Credit exposure from Non-core lending activities
Credit portfolio in non-core activities broken down by industry (NACE) and stages
30 June 2023
(DKK millions)
Gross exposure
Expected credit loss
Net exposure
Net exposure, ex collateral
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3
Non-core banking
Non-core conduits etc.
Total
-
2,494
2,494
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,493
-
2,493
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
31 December 2022
(DKK millions)
Non-core banking
Non-core conduits etc.
Total
Gross exposure
Expected credit loss
Net exposure
Net exposure, ex collateral
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3
1
2,444
2,445
-
-
-
-
94
94
-
-
-
-
-
-
-
39
1
2,444
39
2,445
-
-
-
-
55
55
-
24
24
-
-
-
-
15
15
Credit portfolio in non-core activities broken down by rating category and stages
30 June 2023
PD level
Gross exposure
Expected credit loss
Net exposure
Net exposure, ex collateral
(DKK millions)
Upper
Lower Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3
1
2
3
4
5
6
7
8
9
10
11 (default)
Total
-
0.01
0.03
0.06
0.14
0.31
0.63
1.90
7.98
25.70
0.01
0.03
0.06
0.14
0.31
0.63
1.90
7.98
25.70
99.99
100.00 100.00
575
915
1,004
-
-
-
-
-
-
-
-
2,494
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
575
915
1,004
-
-
-
-
-
-
-
-
-
2,493
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
31 December 2022
(DKK millions)
1
2
3
4
5
6
7
8
9
10
11 (default)
Total
PD level
Net exposure, ex collateral
Lower Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3
Expected credit loss
Gross exposure
Net exposure
Upper
0.01
-
0.03
0.01
0.06
0.03
0.14
0.06
0.31
0.14
0.63
0.31
1.90
0.63
1.90
7.98
7.98 25.70
25.70 99.99
100.00 100.00
817
1,163
453
-
-
12
-
-
-
-
-
2,445
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
94
94
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
39
817
1,163
453
-
-
12
-
-
-
-
-
39
2,445
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
55
-
24
-
-
-
-
-
-
-
-
-
55
24
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
15
15
Notes – Danske Bank Group
Counterparty credit risk and credit exposure from trading and investment securities
(DKK billions)
Counterparty credit risk
Derivatives with positive fair value
Reverse transactions and other loans at fair value**
Credit exposure from other trading and investment securities
Bonds
Shares
Other unutilised commitments***
Total
Danske Bank / Interim report – first half 2023 76/88
30 June
2023
31 December
2022*
374.5
255.4
463.8
9.3
0.1
430.1
246.8
486.7
10.2
-
1,103.0
1,173.7
* Comparative information has been restated, as described in note G2(a).
**Reverse transactions and other loans at fair value included as counterparty credit risk are loans at the trading units of Large Corporates & Institutions. These loans consist of reverse transactions
of DKK 255.4 billion (31 December 2022: DKK 246.0 billion), of which DKK 76.6 billion relates to credit institutions and central banks (31 December 2022: DKK 37.4 billion), and other primarily
short-term loans of DKK 0.0 billion (31 December 2022: DKK 0.8 billion), of which DKK 0.0 billion (31 December 2022: DKK 0.8 billion) relates to credit institutions and central banks.
***Other unutilised commitments comprise private equity investment commitments and other obligations.
Derivatives with positive fair value
(DKK millions)
Derivatives with positive fair value before netting
Netting (under accounting rules)
Carrying amount
Netting (under capital adequacy rules)
Net current exposure
Collateral
Net amount
Derivatives with positive fair value after netting for accounting purposes:
Interest rate contracts
Currency contracts
Other contracts
Total
Bond portfolio
30 June
2023
31 December
2022
1,066,266
691,751
1,202,931
772,809
374,515
278,947
95,568
80,919
430,123
340,984
89,139
78,549
14,649
10,590
277,756
95,868
891
306,248
122,848
1,027
374,515
430,123
(DKK millions)
30 June 2023
Held-for-trading (FVPL)
Managed at fair value (FVPL)
Held to collect and sell (FVOCI)
Held to collect (AMC)
Central and
local govern-
ment bonds
Quasi-
government
bonds
Danish
mortgage
bonds
108,042
1,767
17,114
52,473
4,256
275
4,312
9,295
20,012
19,335
60,043
86,974
Swedish
covered
bonds
29,443
928
6,100
4,301
Other
covered
bonds
5,745
280
22,801
505
Corporate
bonds
8,530
-
1,248
-
Total
176,028
22,585
111,618
153,548
Total
179,395
18,138
186,364
40,772
29,332
9,778
463,779
31 December 2022*
Held-for-trading (FVPL)
Managed at fair value (FVPL)
Held to collect and sell (FVOCI)
Held to collect (AMC)
149,059
2,339
15,730
53,681
3,452
594
4,597
9,292
13,729
13,577
63,108
81,991
19,753
1,011
6,695
5,599
5,543
409
25,045
1,011
8,859
304
1,253
-
200,395
18,233
116,429
151,573
Total
220,809
17,935
172,405
33,057
32,007
10,417
486,630
* Comparative information has been restated, as described in note G2(a).
At 30 June 2023, the Group had an additional bond portfolio, including bond-based unit trust certificates, worth DKK 205,598 million (31 December
2022: DKK 173,393 million) recognised as assets under insurance contracts and thus not included in the table above. The section on insurance risk in
Annual Report 2022 provides more information. For bonds classified as hold-to-collect, amortised cost exceeded fair value as at 30 June 2023 and 31
December 2022, see note G13 for more information.
Danske Bank / Interim report – first half 2023 77/88
Notes – Danske Bank Group
Bond portfolio continued
Bond portfolio broken down by geographical area
(DKK millions)
30 June 2023
Denmark
Sweden
UK
Norway
USA
Spain
France
Luxembourg
Finland
Ireland
Italy
Portugal
Austria
Netherlands
Germany
Belgium
Other
Total
31 December 2022*
Denmark
Sweden
UK
Norway
USA
Spain
France
Luxembourg
Finland
Ireland
Italy
Portugal
Austria
Netherlands
Germany
Belgium
Other
Central and
local govern-
ment bonds
Quasi-
government
bonds
Danish
mortgage
bonds
Swedish
covered
bonds
26,487
41,526
11,125
3,251
15,627
433
10,736
-
9,222
860
1,877
4
2,676
2,895
51,138
1,537
-
-
-
389
-
4,518
-
18
5,503
3,802
-
-
-
-
2
-
3,261
645
186,364
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
40,772
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Other
covered
bonds
-
-
2,802
25,076
-
1
119
-
316
-
-
-
63
17
302
1
635
Corporate
bonds
1,005
3,046
937
2,469
12
1
99
121
1,005
8
1
-
134
702
124
-
114
Total
213,856
85,345
15,252
30,797
20,157
435
10,972
5,624
14,345
868
1,878
4
2,874
3,616
51,564
4,799
1,394
179,395
18,138
186,364
40,772
29,332
9,778
463,779
46,390
77,432
6,795
3,902
16,534
2,372
11,163
-
8,293
1,120
1,322
14
4,393
3,261
37,142
676
-
-
-
-
-
4,361
-
17
6,123
4,637
-
-
-
-
2
-
2,195
600
172,405
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
33,057
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,680
28,163
-
1
229
-
362
-
-
-
13
16
290
1
253
4,573
2,628
897
-
-
-
96
82
1,253
26
2
-
61
512
288
-
-
223,369
113,117
10,371
32,065
20,895
2,372
11,505
6,205
14,544
1,145
1,324
14
4,467
3,791
37,719
2,872
853
Total
220,809
17,935
172,405
33,057
32,007
10,417
486,630
* Comparative information has been restated, as described in note G2(a).
Danske Bank / Interim report – first half 2023 78/88
Notes – Danske Bank Group
Bond portfolio continued
Bond portfolio broken down by external ratings
(DKK millions)
30 June 2023
AAA
AA+
AA
AA-
A+
A
A-
BBB+
BBB
BBB-
BB+
BB
BB-
Sub. "investment-grade" or unrated
Central and
local govern-
ment bonds
Quasi-
government
bonds
Danish
mortgage
bonds
Swedish
covered
bonds
137,678
6,987
18,705
13,712
-
379
-
55
189
1,692
-
-
-
-
15,736
2,372
30
-
-
-
-
-
-
-
-
-
-
-
185,914
-
-
-
-
443
-
-
6
-
-
-
-
-
40,771
-
1
-
-
-
-
-
-
-
-
-
-
-
Other
covered
bonds
28,697
53
490
-
-
92
-
-
-
-
-
-
-
-
Corporate
bonds
1,103
1
925
28
135
3,496
268
641
1,891
446
201
429
64
151
Total
409,900
9,413
20,150
13,739
135
4,410
268
696
2,086
2,137
201
429
64
151
Total
179,395
18,138
186,364
40,772
29,332
9,778
463,779
31 December 2022*
AAA
AA+
AA
AA-
A+
A
A-
BBB+
BBB
BBB-
BB+
BB
BB-
Sub. "investment-grade" or unrated
180,479
9,542
19,234
6,727
1,120
2,204
-
167
230
1,106
-
-
-
-
15,513
2,207
215
-
-
-
-
-
-
-
-
-
-
-
172,222
-
-
-
-
179
-
-
5
-
-
-
-
-
33,048
-
10
-
-
-
-
-
-
-
-
-
-
-
31,728
64
117
-
-
98
-
-
-
-
-
-
-
-
1,521
222
1,292
27
267
2,207
368
863
2,242
336
650
247
15
161
434,510
12,035
20,868
6,754
1,387
4,688
368
1,030
2,477
1,443
650
247
15
161
Total
220,809
17,935
172,405
33,057
32,007
10,417
486,630
* Comparative information has been restated, as described in note G2(a).
Danske Bank / Interim report – first half 2023 79/88
Financial statements – Danske Bank A/S
The financial statements of the Parent Company, Danske Bank A/S, are prepared in accordance with the Danish Financial Business Act and the Danish
FSA’s Executive Order No. 281 of 26 March 2014 on Financial Reports for Credit Institutions and Investment Companies, etc. as amended by Execu-
tive Order No. 707 of 1 June 2016, Executive Order No. 1043 of 5 September 2017, Executive Order No. 1441 of 3 December 2018, Executive Order
No. 1593 of 9 November 2020 and Executive Order No. 116 of 27 January 2023. A description of policies for data ethics is available at https://dans-
kebank.com/about-us/corporate-governa nce.
Note G2(a) provides further information on changes in accounting policies implemented as at 1 January 2023. The impact of these changes for Danske
Bank A/S at 1 January 2022 is a net decrease in equity of DKK 707 million, as a result of an increase of DKK 138 million in assets under pooled schemes
and a decrease of DKK 845 million in holdings in group undertakings. The impact of the changes in accounting policies increased Danske Bank A/S Net
profit in 2022 by DKK 488 million, due to an increase in value adjustments of DKK 35 million and an increase in income from associates / group under-
takings of DKK 453 million. Except for these changes, Danske Bank A/S has not changed its significant accounting policies from those applied in the
Annual Report 2022.
The accounting policies applied are identical to the Group’s IFRS accounting principles, see note G1, with the following exception:
•
Domicile property (except right-of-use assets) is measured (revalued) at its estimated fair value through Other comprehensive income.
The estimated fair value of domicile property is determined in accordance with the Danish FSA’s Executive Order on Financial Reports for Credit Institu -
tions and Investment Companies, etc.
Holdings in subsidiaries are measured on the basis of the equity method. Net profit from these undertakings is recognised under Income from associates
and group undertakings.
The format of the Parent Company’s financial statements is not identical to the format of the consolidated financial statements in accordance with IFRS.
The table below shows the differences in net profit and shareholders’ equity between the IFRS consolidated financial statements and the Parent Com-
pany’s financial statements presented in accordance with Danish FSA rules.
(DKK millions)
Danske Bank Group based on IFRS
Domicile properties
Tax effect
Parent company statement based on Danish FSA rules
* Comparative information has been restated, as described in note G2(a).
Net profit
2023
Net profit
2022*
Equity
Equity
30 June 2023 31 December 2022*
10,178
-1
1
10,177
4,538
-2
1
4,537
168,648
216
-28
160,278
217
-28
168,835
160,466
Income statement – Danske Bank A/S
Note
(DKK millions)
Interest income
Interest expense
Net interest income
Dividends from shares etc.
Fee and commission income
Fees and commissions paid
P1
P2
Net interest and fee income
Value adjustments
Other operating income
Staff costs and administrative expenses
Amortisation, depreciation and impairment charges
Other operating expenses
Loan impairment charges etc.
Income from associates and group undertakings
Profit before tax
Tax
Net profit
* Comparative information has been restated, as described in note G2(a).
Danske Bank / Interim report – first half 2023 80/88
First half
2023
29,545
20,011
9,534
329
6,276
1,090
15,049
4,048
903
10,457
1,312
693
152
4,219
11,605
1,428
10,177
First half
2022*
10,756
3,095
7,661
348
6,931
1,080
13,860
-524
835
10,205
1,440
-
343
2,895
5,078
542
4,537
Statement of comprehensive income – Danske Bank A/S
Danske Bank / Interim report – first half 2023 81/88
(DKK millions)
Net profit
Other comprehensive income
Items that will not be reclassified to profit or loss
Remeasurement of defined benefit pension plans
Tax*
Items that will not be reclassified to profit or loss
Items that are or may be reclassified subsequently to profit or loss
Translation of units outside Denmark
Hedging of units outside Denmark
Unrealised value adjustments of bonds at fair value (OCI)
Realised value adjustments of bonds at fair value (OCI)
Tax*
Items that are or may be reclassified subsequently to profit or loss
Total other comprehensive income
Total comprehensive income
Portion attributable to
Shareholders of Danske Bank A/S (the Parent Company)
Additional Tier 1 capital holders
Total comprehensive income
* A positive amount is a tax expense, and a negative amount is a tax income
** Comparative information has been restated, as described in note G2(a).
First half
2023
First half
2022**
10,177
4,537
-115
-16
-99
-4,533
2,260
-60
-15
-541