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Contents
Management's report
Financial statements
Financial highlights - D anske Bank Group
Executive summary
Financial review
Business units
Personal Customers
Business Cust omers
Large Corporates & Institutions
Danica Pe nsion
Northern Ireland
Group Functions
Definition of alternative performance
measures
3
4
6
12
13
15
17
19
21
23
25
Income statement
Statement of comprehensive income
Balance sheet
Statement of capital
Cash flow statement
Notes
Statements
Statement by the management
Supplementary informatio n
27
28
29
30
32
33
65
66
Danske Bank / Interim report – first quarter 2024 3/66
Financial highlights – Danske Bank Group
Income statement
(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.
Profit before loan impairment charges
Loan impairment charges
Profit before tax
Tax
Net profit
Q1
2024
9,142
3,376
769
492
176
13,955
6,337
246
7,618
101
7,517
1,888
5,629
Q1
2023*
8,021
3,252
1,331
497
292
13,394
6,292
254
7,101
147
6,954
1,787
5,167
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
247,998
326,300
1,631,975
487,028
276,156
514,238
226,112
295,708
253,823
1,770,948
569,576
291,938
497,029
112,385
Index
24/23
114
104
58
99
60
104
101
97
107
69
108
106
109
84
129
92
86
95
103
201
Q4
2023*
9,121
3,482
486
550
189
13,827
6,624
248
7,203
-32
7,235
1,470
5,765
271,434
272,841
1,670,142
548,189
283,914
496,031
228,429
Index
Q1/Q4
Full year
2023*
100
97
158
89
93
101
96
99
106
-
104
128
98
91
120
98
89
97
104
99
34,972
12,904
2,613
1,472
460
52,422
25,478
989
26,944
262
26,682
5,420
21,262
271,434
272,841
1,670,142
548,189
283,914
496,031
228,429
Total assets
3,709,808
3,791,407
98
3,770,981
98
3,770,981
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
Subordinated debt
Shareholders' equity
64,537
230,255
1,050,241
745,981
310,846
398,322
500,719
195,816
39,674
173,417
85,592
176,323
1,158,404
724,600
324,000
510,300
480,034
129,256
38,324
164,575
75
131
91
103
96
78
104
151
104
105
70,774
197,140
1,108,898
741,062
315,145
454,487
482,630
186,332
38,774
175,739
91
117
95
101
99
88
104
105
102
99
70,774
197,140
1,108,898
741,062
315,145
454,487
482,630
186,332
38,774
175,739
Total liabilities and equity
3,709,808
3,791,407
98
3,770,981
98
3,770,981
Ratios and key figures
Dividend per share (DKK)**
Earnings per share (DKK)
Return on avg. shareholders' equity (% p.a.)
Net interest income as % p.a. of loans and deposits
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)
-
6.6
12.9
1.28
45.4
23.0
18.5
206.6
202.5
20,094
-
6.0
12.7
1.09
47.0
22.3
18.0
138.0
191.7
21,205
7.5
6.7
13.4
1.27
47.9
23.1
18.8
180.4
204.4
20,021
95
14.5
24.8
12.7
1.21
48.6
23.1
18.8
180.4
204.4
20,021
100
*Comparative information has been restated as described in note G2(b)
**Dividend for 2023 of a total of DKK 14.5 per share consists of an interim dividend of DKK 7.0 per share that was paid out in connection with the interim report for the
first half of 2023 and a dividend of DKK 7.5 per share for the second half of 2023 that was paid out on 26 March 2024.
Executive summary
The start of 2024 has unfortunately been characterised by
continued geopolitical uncertainty. In spite of the global
events, when we focus on the macroeconomic trends in the
regions in which we operate, we have seen some positive de-
velopments lately as many areas of the Nordic economies
are performing well and inflation is trending down. For the
Danish economy specifically, growth has been supported by
a solid activity level in the services sector and a strong phar-
maceutical sector, leading to a continually low unemploy-
ment rate and resilient household finances. Additionally, the
latest macroeconomic outlook for Denmark is now more pos-
itive, supported by expectations for lower policy rates in the
course of 2024. Overall, we remain mindful that certain sec-
tors are likely to be negatively affected by the full effects of
the higher rate environment and that the macroeconomic
and geopolitical uncertainty remains high.
For Danske Bank, the first quarter of 2024 was a continua-
tion of the stable and satisfactory performance we saw in
2023, enabling us to generate a return on equity of 12.9%
for the quarter. As a strong financial institution, we continue
to be a solid financial partner for our customers, financing the
green transition and investing to develop our solutions. De-
spite modest demand for new loans, we continued to see
good interest in our leading savings products and also in-
creased demand for our investment solutions.
The first quarter of 2024 was effectively the first quarter of
our new strategy, Forward ’28. This marks the continued
transformation of Danske Bank, but also a physical change
for Danske Bank as we have started to move into our new
domicile. During the first quarter of 2024, we also unveiled a
new strategy for Asset Management, partnering up with
Goldman Sachs and Blackrock to deliver top-of-the-range in-
vestment products to our customers. Moreover, we have an-
nounced major investments in cloud technology and signed a
multi-year agreement with Amazon Web Services. As part of
Forward ’28, our investments in digital platforms continue to
increase. This also means that we are looking into how gen-
erative AI can help customers and employees, and we have
started this process by rolling out an internal digital assistant
called DanskeGPT.
Sustainability is a core pillar of our Forward ’28 strategy, and
2024 has so far been a busy year for our sustainability activ-
ities. We have launched a strategy paper detailing our strate-
gic direction, just as we have launched a new Position State-
ment on Fossil Fuels that introduces stricter requirements
for our investment activities. We have also published a Cli-
mate Action Plan Progress Report 2023 that provides a sta-
tus on the Group’s climate targets as presented in our Cli-
mate Action Plan from January 2023. This underlines our
continued ambition to be a leading Nordic bank in terms of
supporting the sustainability 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 solid with significant
Danske Bank / Interim report – first quarter 2024 4/66
buffers well above the regulatory requirements. At the end of
March 2024, our liquidity coverage ratio stood at 168% (31
December 2023: 170%), with an LCR reserve of DKK 559
billion (31 December 2023: DKK 615 billion), and our net
stable funding ratio stood at 125%.
Financials
Danske Bank delivered a net profit of DKK 5,629 million in
the first quarter of 2024, against a net profit of DKK 5,167
million in the first quarter of 2023. There was a strong
development based on repricing actions and an uplift in net
interest
interest rate
environment.
income due
the positive
to
Net fee income increased 4% from the level in the same
period last year, due mainly to higher customer activity and
repricing actions. Fee
financing activity
income
decreased due to lower housing market activity, especially in
Denmark.
from
Net trading income decreased as the first quarter of 2023
was exceptional, but also due to lower customer activity and
changes in market conditions.
Net income from insurance business was at the same level
as in the first quarter of 2023. The result benefited from a
reversal of provisions of DKK 50 million related to the sale of
Danica Norway. Relative to the fourth quarter of 2023, net
income decreased due to an increase in claims related to the
health and accident business.
Operating expenses are on track to end in line with our full -
year guidance. The year-on-year increase was caused mainly
by higher digitisation investments under our Forward ’28
strategy and higher staff costs that were impacted by wage
inflation.
Loan impairment charges reflect overall resilient credit
quality and were low in the first quarter of 2024, amounting
to DKK 101 million. Growth is expected to gradually return to
normal levels, and the impact on impairments is reduced,
however, the macroeconomic landscape remains uncertain.
Annual General Meeting 2024
Utilising the latest technology, the 2024 Annual General
Meeting was the first ever fully digital annual general meeting
hosted by a major company in Denmark.
The proposed dividend of DKK 7.5 per share for the second
half of 2023 was approved. It was paid out on 26 March to
individuals,
comprising
our
organisations, pensions funds in the Nordic countries and
elsewhere, thereby supporting societies.
shareholders,
private
On 2 February 2024, Danske Bank A/S announced a share
buy-back programme for a total of DKK 5.5 billion running in
the period from 5 February 2024 to 31 January 2025, at the
latest, as described in company announcement no. 2 2024.
Danske Bank / Interim report – first quarter 2024 5/66
At danskebank.com, weekly updates on the share buy-back
programme are made available.
At 31 March 2024, Danske Bank had bought back around
4.0 million shares for a total purchase amount of DKK 0.8
billion (figures at trade date] of the planned DKK 5.5 billion
share buy-back programme.
Outlook for 2024
Total income is expected to grow in 2024, driven by higher
core income, our continued efforts to drive commercial mo-
mentum, and in line with our financial targets for 2026. In-
come from trading and insurance activities will be subject to
financial market conditions.
We expect operating expenses in 2024 to be in the range of
DKK 26–26.5 billion, reflecting increased investments in line
with our financial targets for 2026 and continued focus on
cost management. The outlook includes non-recurring items
of approximately DKK 0.6 billion related to the relocation to
the new domicile and minor costs for the divestment of the
personal customer business in Norway.
Loan impairment charges are subject to an elevated level of
geopolitical and macroeconomic uncertainty and are ex-
pected to reflect our assumptions in our financial targets for
2026 of approximately 8 basis points p.a.
We expect net profit to be in the range of DKK 20-22 billion.
Financial review
Q1 2024 vs Q1 2023
Net profit increased to DKK 5,629 million (Q1 2023:
DKK 5,167 million) as a result of increases in net interest
income and net fee income. Good customer activity and low
loan impairment charges also supported the financial result
for the first quarter of 2024.
Income
Net interest income increased to DKK 9,142 million (Q1
2023: DKK 8,021 million). The increase was driven by higher
income from deposits following repricing actions and market
rate developments as well as product development
initiatives.
Net fee income increased to DKK 3,376 million (Q1 2023:
DKK 3,252 million). Everyday banking fees increased on the
back of higher customer activity, repricing actions and the
continued transfer of customers to a subscription fee service
from assets under
model. Furthermore, higher
management and cash management services also
contributed to the increase in net fee income.
fees
Net trading income decreased to DKK 769 million (Q1 2023:
DKK 1,331 million) as the first quarter of 2023 was excep-
tional, but also due to lower customer activity and changes in
market conditions.
Net income from insurance business amounted to DKK 492
million (Q1 2023: DKK 497 million) and was thus at the same
level as in the first quarter of 2023. The net income included
a reversal of provisions of DKK 50 million related to the sale
of Danica Norway.
Other income amounted to DKK 176 million (Q1 2023:
DKK 292 million). The decrease was mainly the result of
lower sales of assets in our leasing company than in the first
quarter of 2023.
Operating expenses
Operating expenses amounted to DKK 6,337 million (Q1
2023: DKK 6,292 million) as underlying expenses continued
to develop according to plan due to our dedicated cost
management. The increase was impacted mainly by higher
digitisation investments under our Forward ’28 strategy and
higher staff costs that were impacted by wage inflation.
Finally, the Resolution fund, Swedish bank tax etc. item stood
at DKK 246 million (Q1 2023: DKK 254 million).
Loan impairment charges
Loan impairment charges were low in the first quarter of
2024, amounting to DKK 101 million (Q1 2023: DKK 147
million).
Danske Bank / Interim report – first quarter 2024 6/66
macroeconomic uncertainty and remain watchful of any
possible credit deterioration.
Loan impairment charges
Q1 2024
Q1 2023
(DKK millions)
Charges
% of net
credit
exposure*
% of net
credit
exposure*
Charges
Personal Customers
Business Customers
Large Corporates &
Institutions
Northern Ireland
Group Functions
Total
-256
709
-376
25
-
101
-0.13
0.43
-0.42
0.17
0.04
0.02
412
149
-392
-24
1
147
0.20
0.09
-0.42
-0.18
0.17
0.03
* Defined as net credit exposure from lending activities, excluding
exposure related to credit institutions and central banks and loan
commitments.
Personal Customers saw impairment reversals, contrary to
2023, when there was a net charge. Reversals for the first
quarter of 2024 were driven by a combination of updated
macroeconomic scenarios and a reduction in post-model
adjustments due to the improved macroeconomic outlook.
Underlying credit quality remained stable.
Business Customers had higher impairment charges than in
2023 owing to a few cases in our leasing organisation as well
as allocation of post-model adjustments. Underlying credit
quality remained solid.
Large Corporates & Institutions continued to see a net
reversal owing to successful restructuring activities that
resulted in a decline in charges made against facilities to
individual customers.
The macroeconomic scenarios have been updated to reflect
a trend towards a more normalised situation. However, the
downside scenario continues to be a severe stagflation
scenario. The scenario weights were unchanged from the end
of 2023 and were as follows: The base-case scenario has a
probability of 60% (2023: 60%), the upside scenario has a
probability of 20% (2023: 20%) and the downside scenario
has a probability of 20% (2023: 20%).
Tax
The tax expense of DKK 1,888 million (Q1 2023: DKK 1,787
million) corresponded to an effective tax rate of 25.1% (Q1
2023: 25.7%).
The impairment level reflected the overall solid credit quality
and the fact that macroeconomic growth is expected to
gradually
the
macroeconomic landscape remains uncertain. We continue
to apply significant post-model adjustments related to the
to normal
although
return
levels,
Q1 2024 vs Q4 2023
Net profit decreased to DKK 5,629 million (Q4 2023:
DKK 5,765 million). An increase in net trading income and
stable net interest income could not compensate for the
decrease in net fee income and net income from insurance
business.
•
•
•
•
•
•
•
Net interest income amounted to DKK 9,142 million
(Q4 2023: DKK 9,121 million). Net interest income
benefited from repricing actions and the stable market
rates.
Net fee income decreased to DKK 3,376 million (Q4
2023: DKK 3,482 million), due mainly to
lower
performance fees from Asset Management.
Net trading income increased to DKK 769 million (Q4
2023: DKK 486 million), due primarily to higher
customer activity and decreased interest rate volatility.
Net income from insurance business decreased to
DKK 492 million (Q4 2023: DKK 550 million). The
decrease was due to an increase in claims related to the
health and accident business and
less positive
developments in the financial markets than in the fourth
quarter of 2023.
Operating expenses decreased to DKK 6,337 million
(Q4 2023: DKK 6,624 million) due to lower expenses
for digitisation and restructuring as well as lower bonus
payments and lower provisions for holiday costs.
Loan impairment charges amounted to DKK 101
million (Q4 2023: net reversal of DKK 32 million).
Impairments in both quarters were driven by single-
name exposures. Underlying credit quality remained
solid.
Tax amounted to DKK 1,888 million (Q4 2023:
DKK 1,470 million), corresponding to an effective tax
rate of 25.1% (Q4 2023: 20.3%). The fourth quarter
benefited from a payment from the tax authorities due
to a correction of tax paid in previous years.
Net profit
DKK 5,629 million
for the first quarter of 2024
Danske Bank / Interim report – first quarter 2024 7/66
Lending
Lending stood at DKK 1,632 billion (end-2023: DKK 1,670
billion). Mortgage lending at nominal value at Realkredit
Danmark amounted to DKK 801 billion (end-2023: DKK 806
billion). Lending volumes in Norway and Sweden saw a
negative effect from the depreciation of the currencies.
Following the Forward ’28 strategy announcement in June
2023, Danske Bank entered into an agreement to sell its per-
sonal customer business in Norway. The sale, which includes ,
among other things, loans and deposits, is expected to close
during the fourth quarter of 2024. Consequently, the per-
sonal customer loan portfolio in Norway was reclassified
from Loans to Other assets in the second quarter of 2023.
At Large Corporates & Institutions, we saw a decrease in
lending volumes of 7%, reflecting the volatile operating
environment. Lending volumes in General Banking were on
par with the level at the end of 2023. We continued to
execute on our strategic ambition to grow our corporate
customer portfolio outside Denmark, and we are thrilled to
have welcomed more new large corporate customers in the
first quarter of 2024.
Lending at Business Customers showed a decrease from the
level at the end of 2023 due to lower bank lending volumes
and lending margins being under pressure from the increase
in market rates. Total bank lending volumes in local currency
were on par with the
level at the end of 2023. The
depreciation of the currencies in Norway and Sweden
reduced bank lending volumes by DKK 6.9 billion, leading to a
lending of 2%. Mortgage volumes in
decrease in bank
Denmark were on par with the level at the end of 2023 ,
leading to an overall decrease in total lending volumes of 1%.
At Personal Customers, we saw a decrease in bank lending
volumes in our market areas that was caused largely by the
subdued housing market. Total lending across markets de-
creased 1% from the level at the end of 2023. Bank lending
volumes decreased 1%, and the nominal mortgage lending
volume in Denmark decreased 1%. The depreciation of the
Swedish krona had a negative effect of DKK 3 billion.
In Denmark, new gross lending, excluding repo
loans,
amounted to DKK 40.7 billion. Lending to personal
customers accounted for DKK 7.2 billion of this amount.
Deposits
Deposits amounted to DKK 1,050 billion at the end of March
2024 (end-2023: DKK 1,109 billion). Deposit volumes in
Norway and Sweden decreased, due mainly to the
depreciation of the currencies.
The personal customer deposit portfolio in Norway was
reclassified from Deposits to Other liabilities in the second
quarter of 2023 due to the sale of the personal customer
business in Norway.
Deposit volumes at Personal Customers in Denmark in-
creased 1% from the level at the end of 2023, driven primar-
ily by savings products. Total deposit volumes have de-
creased 1% since the end of 2023, due mainly to the depre-
ciation of the Swedish krona combined with a decrease in vol-
umes in Sweden.
At Business Banking, deposit volumes increased in Finland
and Norway, driven by Advisory Banking customers. Deposit
volumes in Sweden and Denmark decreased as a result of a
decrease in deposits from commercial real estate and
Danske Business Direct customers. Both the Swedish krona
and the Norwegian krone depreciated further, with a total ef-
fect of DKK 3.5 billion since the end of 2023. Total deposit
volumes decreased 2% from the level at the end of 2023.
At Large Corporates & Institutions, deposit volumes de-
creased from the end of 2023 due to seasonality around tax
and dividend payments and volatility in institutional deposits.
from
Credit exposure
Credit exposure
lending activities decreased to
DKK 2,476 billion (end-2023: DKK 2,550 billion). The
decrease in exposure was caused by lower deposits with
central banks and Financial Institutions as well as a decrease
in the Personal Customers Norway exposure due to the
decision to exit the personal customer market in Norway.
Furthermore, the depreciation of the Swedish krona and the
Norwegian krone had a negative impact on the exposure
levels.
Risk Management 2023, section 3, which is available at
danskebank.com/ir, provides details on Danske Bank’s credit
risk management.
Credit quality
Credit quality remained strong in the first quarter of 2024 for
all business units, and we remain vigilant for any possible
deterioration related to the uncertainty mentioned in the loan
impairment charges section above.
Stage 3 loans
(DKK millions)
Gross exposure
Allowance account
Net exposure
31 March
2024
31 December
2023
34,049
9,549
24,500
32,686
9,062
23,624
Collateral (after haircut)*
21,587
20,642
Stage 3 coverage ratio (%)*
77
75
* Collateral (after haircut) and Stage 3 coverage ratio have been restated.
The stage 3 coverage ratio is calculated as allowance account stage 3
exposures relative to gross stage 3 net of collateral (after haircuts).
Total gross credit exposure in stage 3 was stable at DKK 34
billion (end-2023: DKK 32.7 billion), corresponding to 1.4%
of total gross exposure. Stage 3 exposure was concentrated
on personal customers, commercial property, retailing and
construction and building materials, which combined
accounted for 57% of total gross exposure in stage 3.
The allowance account amounted to 1.11% (end-2023:
1.07%) of credit exposure.
Danske Bank / Interim report – first quarter 2024 8/66
Allowance account by
business units
31 March 2024
31 December 2023
(DKK millions)
Personal Customers
Business Customers
Large Corporates &
Institutions
Northern Ireland
Group Functions
Accum.
impairm.
charges
5,010
11,245
% of credit
exposure*
Accum.
impairm.
charges
% of credit
exposure*
0.66
1.69
5,306
10,705
3,176
840
26
0.92
1.39
-0.58
3,308
794
27
0.68
1.58
0.92
1.34
1.21
1.07
Total
20,297
1.11
20,140
* Relating to lending activities.
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
customers with conventional banking products and from the
Group’s funding and liquidity management activities at Group
Treasury (for more details, please see section 5.2.3 of Risk
Management 2023).
As part of managing the interest rate risk in the banking book,
the Group holds high quality liquid bonds, and this portfolio is
part of the Group’s LCR. To ensure aligned accounting
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
increase in net interest income from deposits and the
corresponding impact on liability values. The carrying amount
and fair value of the Group’s hold-to-collect bond instruments
can be seen in note G12.
Funding and liquidity
During the first quarter of 2024, on the back of higher-than-
forecasted inflation prints, the markets took out some of the
expectations for central bank rate cuts. The well-known and
very tense geopolitical situation persisted.
Despite the uncertainty, the credit markets stayed active,
with stable investor appetite for Danske Bank issues, which
we continued to take advantage of.
At the end of March 2024, the Group had issued covered
bonds of DKK 3.6 billion, preferred senior debt of DKK 6.8
billion, non-preferred senior debt of DKK 14.2 billion and tier
2 capital of DKK 5.6 billion, thus bringing total long -term
wholesale funding to DKK 30.2 billion.
Our strategy is to be a regular issuer in the EUR benchmark
format and in the domestic USD market for preferred senior
and non-preferred senior bonds in the Rule 144A format. We
also maintain the strategy of securing funding directly in our
main lending currencies, including the NOK and SEK. 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
Danske Bank / Interim report – first quarter 2024 9/66
At the end of the first quarter of 2024, the Group’s solvency
need ratio was 11.1%, an increase of 0.4 percentage points
from the level at the end of 2023. The increase was due
mainly to a reassessment of capital to cover data risks that
increased the solvency need by DKK 2 billion. The
reassessment was made following the Danish FSA’s orders
issued on 12 February 2024.
A combined buffer requirement (CBR) applies to financial
institutions in addition to the solvency need ratio. At the end
of the first quarter of 2024, the Group’s CBR was 8.0% and
unchanged from the level at the end of 2023.
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, the capital conservation
buffer and the systemic risk buffer. Furthermore, the CBR
must be met in addition to the MREL. In the annual MREL de-
cision from the Danish FSA, the (backward-looking) MREL
was set at 27.3% of the total REA adjusted for Realkredit
Danmark.
At the end of the first quarter of 2024, the point-in-time re-
quirement including the CBR was equivalent to DKK 244 bil-
lion, or 36.1% of the total REA adjusted for Realkredit Dan-
mark. Taking the deduction of capital and debt buffer require-
ments for Realkredit Danmark into account, MREL-eligible li-
abilities amounted to DKK 302 billion. In addition, an MREL of
6% of the leverage ratio exposure (LRE) is in place. The LRE-
based requirement equalled 23.0% 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 the first quarter of 2024, the subordination re-
quirement was equivalent to DKK 203 billion. The backward-
looking subordination requirement, as set by the Danish FSA,
was 29.3% of the total REA adjusted for Realkredit Danmark.
MREL-eligible subordinated liabilities stood at DKK 245 bil-
lion.
redemptions on the one hand and our capital targets on the
other. Any issuance of subordinated debt may cover part of
our funding need. Note G6 provides more information about
bond issues in the first quarter of 2024.
Danske Bank’s liquidity position remained robust. At the end
of March 2024, our liquidity coverage ratio stood at 168%
(31 December 2023: 170%), with a LCR reserve of DKK 559
billion (31 December 2023: DKK 615 billion), and our net
stable funding ratio stood at 125%.
At 31 March 2024, the total nominal value of outstanding
long-term funding, excluding debt issued by Realkredit Dan-
mark, was DKK 334 billion (31 December 2023: DKK 337
billion).
Capital ratios and requirements
At the end of the first quarter of 2024, the Group’s total
capital ratio was 23.0%, and its CET1 capital ratio was
18.5%, against 23.1% and 18.8%, respectively, at the end of
2023. The movement in the capital ratios in the first quarter
of 2024 was driven primarily by the DKK 5.5 billion share
buy-back programme initiated on 5 February 2024, but the
effect was partly countered by a decrease in the REA.
During the first quarter of 2024, the total REA decreased
approximately DKK 19 billion, due mainly to a decline in the
REA for credit risk and market risk.
Danske Bank’s capital management practices 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.
Capital ratios and requirements
31 March
(% 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 systemic
risk buffer
- portion from SIFI buffer
Solvency need ratio
Total capital requirement**
Excess capital
CET1 capital
Total capital
2024 Fully phased-in*
18.5
23.0
14.4
2.0
2.5
0.5
3.0
11.1
19.1
4.2
4.0
18.4
23.0
14.4
2.0
2.5
0.5
3.0
11.1
19.1
4.1
3.9
* Based on fully phased-in rules and requirements, including the fully
phased-in impact of IFRS 9.
** 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 the first
quarter of 2024.
Danske Bank / Interim report – first quarter 2024 10/66
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 final rules are not
expected to be adopted before the end of the second quarter
of 2024. The European Parliament has recently adopted the
EU Banking Package, which means that, as expected, the new
rules will apply from 1 January 2025 and onwards.
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. The Group currently does not
expect the output floor to affect the Group’s capital position
until 2033 at
transitional
the earliest, when
arrangements are set to lapse.
impact of
the
the
On 3 October 2023, it was announced that the Danish
Systemic Risk Council had recommended that the Danish
minister for Industry, Business and Financial Affairs activate
a sector-specific systemic risk buffer (SyRB) with a buffer
rate of 7% for exposures to real estate companies in
Denmark. The Danish government intends to follow the
recommendation and plans to activate the SyRB with effect
from 30 June 2024.
On 26 April, the Danish Ministry of Industry, Business and Fi-
nancial Affairs announced the government’s decision to acti-
vate the 7% SyRB with effect from 30 June 2024 as recom-
mended by the Danish Systemic Risk Council. However, the
government decided to exclude all exposures to real estate
companies in Denmark in the 0-15% LTV band. We expect a
CET1 impact from 30 June 2024 of around 30 bps.
Credit ratings
There were no changes to the following credit ratings in the
first quarter of 2024.
Danske Bank’s credit ratings
Fitch
Moody’s
S&P
Counterparty rating
AA-
A1/P-1
AA-/A-1+
Deposits
AA-/F1+
/P-1
-
Preferred senior debt
AA-/F1+
A3/P-2
A+/A-1
A2/Positive
Issuer rating
Outlook
Non-preferred senior debt
A+/F1
A3/P-2
A+/A-1
Stable
Positive
Stable
A+
A-
BBB
Baa2
BBB+
-
-
BBB
BB+
Note: The requirement and eligible funds are adjusted for Realkredit Dan-
mark’s capital and debt buffer requirements.
Leverage ratio
At the end of the first quarter of 2024, the Group’s leverage
ratio was 4.8% under both the transitional rules and the fully
phased-in rules.
Capital targets and capital distribution
The CET1 capital ratio target was kept at above 16% and en-
sures a sufficiently prudent buffer in relation to the capital re-
quirement. Danske Bank fully meets this capital target.
The Board of Directors will continue to adapt the capital tar-
gets to regulatory developments in order to ensure a strong
capital position.
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 the Group’s
capital distribution policy.
At 31 March 2024, Danske Bank had bought back around
4.0 million shares for a total purchase amount of DKK 0.8 bil-
lion (figures at trade date] of the planned DKK 5.5 billion
share buy-back programme.
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 March 2024, Danske Bank was in compliance
with all threshold values. A separate report is available at
danskebank.com/investor-relations.
Tier 2
AT1
Realkredit Danmark also complies with all threshold values.
Danske Bank / Interim report – first quarter 2024 11/66
As previously announced, Danske Bank has been working to-
wards restarting its debt collection in respect of personal
customer cases in Denmark in collaboration with a debt col-
lection agency, Lowell Danmark A/S. We have now reached
this milestone as we started up the new debt collection sys-
tem and transferred the first cases for collection to Lowell
Danmark A/S in December 2023. Initially, Danske Bank only
transfers the least complex debt collection cases to Lowell
Danmark A/S for collection. Later, the new IT system will
gradually be enhanced and tested to handle all case types in
a secure and compliant manner. This work will be gradually
progressing in 2024.
Danske Bank continues to have a dialogue with and report its
progress in the debt collection case to the impartial review-
ers appointed by the Danish FSA.
Changes to the Board of Directors
On 23 February 2024,
it was announced that Jan
Thorsgaard Nielsen and Carol Sergeant would not seek re-
election at the Annual General Meeting.
On 21 March 2024, the Annual General Meeting re-elected
Martin Blessing, Lars-Erik Brenøe, Jacob Dahl, Raija-Leena
Hankonen-Nybom, Allan Polack and Helle Valentin. Martin
Nørkjær Larsen and Lieve Mostrey were elected as new
members of the Board of Directors.
The Board of Directors thus now consists of Martin Blessing
(Chairman), Martin Nørkjær Larsen (Vice Chairman), Lars-
Erik Brenøe, Jacob Dahl, Raija-Leena Hankonen-Nybom, Lieve
Mostrey, Allan Polack and Helle Valentin as well as the four
members elected by the employees: Bente Bang, Kirsten
Ebbe Brich, Aleksandras Cicasovas and Louise Aggerstrøm
Hansen.
Environmental, Social and Governance (ESG) ratings
There were no changes to the following ESG ratings in the
first quarter of 2024.
Danske Bank’s ESG ratings
Score at
31 March 2024
Score at
31 December 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
60
Personal customer business in Norway
Following the Forward ’28 strategy announcement in June
2023, Danske Bank 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.
On 7 February 2024, we announced that the Norwegian Fi-
nancial Supervisory Authority had approved the sale, and on
15 December and 20 December 2023, the sale was ap-
proved by the Norwegian Competition Authority and the Dan-
ish Financial Supervisory Authority, respectively, and all re-
quired public authority approvals have thus been obtained.
Danske Bank and Nordea remain committed to making the
transition as smooth as possible for both customers and em-
ployees. The transaction is expected to be completed by the
end of 2024.
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 the end of March 2024, nearly 99% of the
debt in approximately 90,000 active customer cases had
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 due 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
began in 2023. Since Danske Bank initiated compensation
pay-out in May 2023, the Bank has paid or attempted to pay
out compensation to approximately 85% of the customers in
scope for the accelerated data-driven solution (excluding es-
tate case customers). Danske Bank will continue paying out
compensation to the remaining debt collection customers in
scope who may have been subject to overcollection in our ef-
forts to provide finality to affected debt collection customers.
Danske Bank / Interim report – first quarter 2024 12/66
Business units
Danske Bank / Interim report – first quarter 2024 13/66
Personal Customers
In the first quarter of 2024, Personal Customers saw good customer activity, and we supported this development by helping our
customers manage their finances through digital solutions, advisory services and competitive products. Customer activity was good
in the investment area, driven by more benign financial markets, and continued the positive trend from the second half of 2023
when market shares increased for Danske Invest retail funds. In the housing market, we saw a slowdown in customer activity in
Denmark from the elevated activity level in the second half of 2023 that was driven especially by new property tax regulation.
Profit before tax amounted to DKK 2,729 million in the first quarter of 2024, an increase of 42% from the year -earlier period. The
increase was driven by higher net fee income, especially everyday banking fees and investment fees, higher net interest incom e
from deposits and net loan impairment reversals.
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
Profit before tax
Loans, excluding reverse transactions before impairments
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 allocated capital
Profit before tax as % p.a. of allocated capital (avg.)
Cost/income ratio (%)
Full-time-equivalent staff
Q1
2024
3,544
1,199
34
15
4,793
2,320
41
2,472
-256
Q1
2023*
3,405
1,104
53
20
4,583
2,253
41
2,330
412
2,729
1,918
655,773
4,228
376,656
558,369
31,065
1.39
31.8
35.1
48.4
4,009
788,736
4,901
411,316
602,840
29,713
1.15
31.4
25.8
49.2
4,277
Index
24/23
104
109
64
75
105
103
100
106
-
142
83
86
92
93
105
-
-
-
-
94
Q4
2023*
3,481
1,059
40
18
4,597
2,625
42
1,973
-20
1,993
664,866
4,435
377,419
587,493
28,809
1.37
27.4
27.7
57.1
4,064
Index
Q1/Q4
Full year
2023*
102
113
85
83
104
88
98
125
-
137
99
95
100
95
108
-
-
-
-
99
14,166
4,175
200
-608
17,932
9,460
169
8,473
312
8,160
664,866
4,435
377,419
587,493
29,306
1.40
28.9
27.8
52.8
4,064
Fact Book Q1 2024 provides financial highlights at customer type level for Personal Customers, Fact Book Q1 2024 is available at danskebank.com/ir.
*Comparative information has been restated as described in note G2(b)
Business initiatives
In the first quarter of 2024, the economies in our core mar-
kets saw a steady development, with stable central bank
rates and stable inflation. We continued to be dedicated to
supporting our customers and providing them with expert ad-
vice based on their individual financial situation, especially in
relation to home financing and investments.
In the investment area, customer activity continued the posi-
tive trend from the second half of 2023, not least as a result
of the more stable financial markets. Assets under manage-
ment increased DKK 112 billion, with the net inflow contrib-
uting DKK 4 billion. With the outlook for a lowering of the cen-
tral bank market rates, we expect to see a further positive de-
velopment in market shares, alongside an increasing cus-
tomer inflow, which we are supporting by a ramp-up of front-
line staff in Private Banking.
We saw a slowdown in the housing market in Denmark in
early 2024, especially in the Copenhagen area. The slow-
down in activity is a spill-over effect of the elevated customer
activity we saw in the second half of 2023 following the intro-
duction of new property tax regulation in Denmark that took
effect on 1 January 2024. In February 2024, we introduced
new and more attractive interest spreads on our cooperative
housing loans. This loan type was named ‘Best in test’ by the
Danish Consumer Council. Housing market activity in Finland
continued to be subdued, with a continued decrease in apart-
ment prices in the first quarter of 2024. In Sweden, we began
to see positive signs, as evidenced by higher customer activ-
ity and a significant increase in mortgage loan applications.
Q1 2024 vs Q1 2023
Profit before tax increased to DKK 2,729 million (Q1 2023:
DKK 1,918 million) and was driven by higher net fee income,
higher net interest income from deposits and net loan impair-
ment reversals. The financial results were adversely affected
by the depreciation of currencies.
Net interest income increased to DKK 3,544 million (Q1
2023: DKK 3,405 million), driven largely by our activities in
Denmark and Finland. The increase was due primarily to
higher income from deposits caused by the rise in market
rates and repricing actions as well as product development
initiatives. Lending margins were under pressure from the
rise in market rates.
Deposit volumes in Denmark increased 1% from the level at
the end of 2023, driven primarily by savings products. Total
deposit volumes have decreased 1% since the end of 2023,
due mainly to the depreciation of the Swedish krona com-
bined with a decrease in volumes in Sweden.
Bank lending volumes decreased in all our markets, largely
because of the subdued housing market. Total bank lending
volumes decreased 1%. The nominal mortgage lending vol-
ume in Denmark decreased 1%. The depreciation of the Swe-
dish krona had a negative effect of DKK 3 billion. Total lending
across markets decreased 1% from the level at the end of
2023.
Net fee income increased to DKK 1,199 million (Q1 2023:
DKK 1,104 million), driven primarily by everyday banking fees
and investment fees. Investment fees rose on the back of a
pick-up in activity as a result of the more stable financial mar-
kets. Fee income from financing activity decreased due to
lower customer activity in the first quarter of 2024 than in
the year-earlier quarter, when customer activity was very
high due to high remortgaging activity as a result of the higher
market rates.
Net trading income decreased to DKK 34 million (Q1 2023:
DKK 53 million) as a result of a decrease in loan termination
fees.
Operating expenses increased to DKK 2,320 million (Q1
2023: DKK 2,253 million). The increase was driven by higher
bonus payments and digitisation investments in accordance
with our Forward ’28 strategy.
Credit quality remained strong. The recent increases in inter-
est rates and the cost of living are mitigated by household
savings and strong labour markets. The average loan-to-
value ratio remained low.
Danske Bank / Interim report – first quarter 2024 14/66
Q1 2024 vs Q4 2023
Profit before tax increased to DKK 2,729 million in the first
quarter of 2024 (Q4 2023: DKK 1,993 million) due to
higher total income, lower operating expenses and net loan
impairment reversals.
•
•
•
•
Net interest income increased 2% from the preceding
quarter. Income from lending benefited from the stable
market rates and repricing actions.
Income from
deposits decreased as a result of customers moving
from transaction accounts to savings accounts.
Net fee income increased 13% from the preceding
quarter, driven by higher customer investment activity
as a result of the more stable financial markets and the
anticipation of lower market rates.
Operating expenses decreased 12% due to lower
lower bonus
expenses for digitisation as well as
payments and lower restructuring costs.
first quarter of 2024 saw
impairment
The
reversals of DKK 256 million, against net reversals of
DKK 20 million in the fourth quarter of 2023. Reversals
continued to be driven by improved collateral values
and updated macroeconomic scenarios.
loan
Profit before tax
DKK 2,729 million
for the first quarter of 2024
Loan impairment charges amounted to a net reversal of
DKK 256 million in the first quarter of 2024 (Q1 2023:
charges of DKK 412 million). Impairments for the first
quarter of 2024
improved
benefited
macroeconomic outlook, which also led to a reduction in post-
model adjustments.
from
the
Credit exposure
Net credit exposure from lending activities amounted to
DKK 829 billion at the end of the first quarter of 2024 (end-
2023: DKK 844 billion), driven primarily by a decrease in Per-
sonal Customers Norway.
Danske Bank / Interim report – first quarter 2024 15/66
Business Customers
In the first quarter of 2024, Business Customers saw an increase in customer activity from the level in the first quarter of 2023
as a result of the general economic improvement in the Nordic region. We supported our customers across segments and markets,
with a focus on providing the best possible advice tailored to our customers’ needs.
In the first quarter of 2024, profit before tax amounted to DKK 1,721 million, a decrease of 28% from the year -earlier quarter. Net
fee income rose as a result of increased customer activity and repricing actions . Furthermore, we saw higher loan impairment
charges that were driven by a few cases in our leasing organisation as well as allocation of post -model adjustments.
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
Profit before tax
Loans, excluding reverse transactions before impairments
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 allocated capital
Profit before tax as % p.a. of allocated capital (avg.)
Cost/income ratio (%)
Full-time-equivalent staff
Q1
2023*
Index
24/23
Q4
2023*
Index
Q1/Q4
Full year
2023*
Q1
2024
2,893
591
5
216
3,705
1,275
62
2,430
709
2,927
568
10
287
3,792
1,246
63
2,546
149
1,721
2,396
647,543
10,015
252,031
370,959
41,871
1.28
23.2
16.4
34.4
1,687
635,948
9,153
279,388
349,891
39,389
1.28
25.9
24.3
32.9
1,664
99
104
50
75
98
102
98
95
-
72
102
109
90
106
106
-
-
-
-
101
3,079
582
18
228
3,907
1,546
64
2,361
185
2,176
654,246
9,511
257,076
371,605
40,205
1.37
23.5
21.6
39.6
1,646
94
102
28
95
95
82
97
103
-
11,684
2,190
54
1,024
14,952
5,255
255
9,698
431
79
9,267
99
105
98
100
104
-
-
-
-
102
654,246
9,511
257,076
371,605
39,644
1.29
24.5
23.4
35.1
1,646
Fact Book Q1 2024 provides financial highlights at customer type level for Business Customers. Fact Book Q1 2024 is available at danskebank.com/ir.
*Comparative information has been restated as described in note G2(b)
Business initiatives
The economies in the Nordic region continued to see im-
provement in early 2024. Inflation stabilised across all mar-
ket areas, and market rates were unchanged in the first quar-
ter of 2024. We continued to support our customers across
segments and to focus on providing the best possible advice
tailored to their needs.
We saw improved customer activity in the first quarter of
2024 relative to the first quarter of 2023, especially in Fin-
land, where the commercial momentum was good. We
launched campaigns targeting housing companies, which re-
sulted in significant growth in new business volume and new
customers relative to the same period last year. The improve-
ment in customer activity as well as repricing actions gener-
ated an increase in net fee income of 4%. The increase was
driven primarily by everyday banking fees.
Sustainability remained an important agenda for our custom-
ers and for us. In March 2024, Danske Bank entered into a
partnership agreement with the EIVEE software firm, which
specialises in calculating businesses’ carbon footprint. With
the partnership, we aim to help our customers with their
green transition and to support their CO2-reduction initia-
tives.
Q1 2024 vs Q1 2023
Profit before tax amounted to DKK 1,721 million (Q1 2023:
DKK 2,396 million). Net fee income increased, but the in-
crease was offset by higher loan impairment charges that
were driven by a few cases in our leasing organisation as well
as allocation of post-model adjustments. The financial perfor-
mance was adversely affected by the depreciation of curren-
cies.
Net interest income decreased 1% as a result of a decrease
in net interest income on lending that was due to lower bank
lending volumes and falling lending margins, which came un-
der pressure by the increase in market rates from the level in
the first quarter of 2023. Deposit margins increased, but the
positive effect was offset by a large outflow of deposit vol-
umes relative to March 2023 that was driven by the public
sector in Norway.
Net fee income increased to DKK 591 million (Q1 2023:
DKK 568 million). The increase was driven primarily by eve-
ryday banking fees due to an increase in customer activity,
Danske Bank / Interim report – first quarter 2024 16/66
Q1 2024 vs Q4 2023
Profit before tax decreased to DKK 1,721 million in the first
quarter of 2024 (Q4 2023: DKK 2,176 million). Net fee
income increased, and operating expenses decreased, but
the effect of this was more than offset by high loan
impairment charges that were driven by a few cases in our
leasing organisation and post-model adjustments related to
the agriculture segment in Denmark.
•
•
•
•
Net interest income decreased to DKK 2,893 million
(Q4 2023: DKK 3,079 million). Net interest income
from lending increased 14% from the level in the fourth
quarter of 2023, but the increase was offset by the
year-end correction between Business Customers and
Group Functions made in the fourth quarter of 2023.
Net fee income increased 2%, driven primarily by
pension fees.
Operating expenses decreased 18%. The decrease
was due to seasonality in expenses related to digital
solutions and to
lower development costs, bonus
payments and restructuring costs.
first quarter of 2024 saw loan
impairment
The
charges of DKK 709 million (Q4 2023: DKK 185
million). Net credit exposure from lending activities
amounted to DKK 736 billion at the end of the first
quarter of 2024 (end-2023: DKK 745 billion). The
decrease was driven primarily by the Public Institutions
and Commercial Property segments.
Profit before tax
DKK 1,721 million
for the first quarter of 2024
repricing actions and the continued transfer of customers to
a subscription fee service model.
Other income decreased to DKK 216 million (Q1 2023:
DKK 287 million). The decrease was the result of lower sales
of assets in our leasing company than in the first quarter of
2023, when sales activity was very high. In February 2024,
we sold the Norwegian company Tyssekraft A/S, which gen-
erated a positive effect on other income of DKK 21 million.
Operating expenses amounted to DKK 1,275 million, an in-
crease of 2% from the level in the same period last year. The
increase was driven by higher staff costs as a result of a
higher number of full-time-equivalent staff. The increase in
the number of full-time-equivalent staff was in line with our
strategy.
Deposit volumes increased in Finland and Norway, driven by
Advisory Banking customers. Deposit volumes in Sweden
and Denmark decreased, driven by commercial real estate
and Danske Business Direct customers. Both the Swedish
krona and the Norwegian krone depreciated further, with a
total effect of DKK 3.5 billion since the end of 2023. Total de-
posit volumes decreased 2% from the level at the end of
2023.
Total bank lending volumes in local currency were on par with
the level at the end of 2023. The depreciation of the curren-
cies in Norway and Sweden reduced bank lending volumes by
DKK 6.9 billion, leading to an overall decrease in bank lending
of 2%. Mortgage volumes in Denmark were on par with the
level at the end of 2023, leading to an overall decrease in to-
tal lending volumes of 1%.
Overall, credit quality remains strong. The trend in credit rat-
ings turned negative in 2023 as a result of rising interest
rates and inflation, and although the trend continues to be
negative, it improved in the first quarter of 2024.
Loan impairment charges amounted to DKK 709 million in
the first quarter of 2024 (Q1 2023: DKK 149 million), which
was an increase relative to the level in the first quarter of
2023. Loan impairment charges for the first quarter of 2024
were driven by a few cases in our leasing organisation as well
as allocation of post-model adjustments.
Credit exposure
Net credit exposure from lending activities amounted to
DKK 736 billion at the end of the first quarter of 2024 (Q4
2023: DKK 745 billion) as a result primarily of a decrease in
the exposure to the Public Institutions and the Commercial
Property segments that was, however, partially countered by
an increase in the exposure to the Services segment.
Danske Bank / Interim report – first quarter 2024 17/66
Large Corporates & Institutions
In the first quarter of 2024, macroeconomic uncertainty persisted, though sentiment was more positive than expected. We remain
dedicated to actively supporting our customers with advisory services backed by our strong product offering and balance sheet .
We continued to leverage our strategic commercial strengths , which drove a positive underlying momentum as reflected in growth
in our corporate customer portfolio outside Denmark, an increased market share of cash management services and higher fees
from our Asset Management business. Furthermore, we are proud to have maintained our leading position in sustainabl e finance.
Profit before tax amounted to DKK 2,682 million, a decrease of 7% from the same period last year, driven primarily by lower n et
trading income.
Large Corporates & Institutions
(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
Profit before tax
Loans, excluding reverse trans. before impairments
of which loans in General Banking
Allowance account, loans (incl. credit institutions)
Deposits, excluding repo deposits
of which deposits in General Banking
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 allocated 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
Total income
Assets under management
(DKK millions)
Institutional clients***
Retail clients***
Q1
2024
1,729
1,521
814
-
4,064
1,758
125
2,306
-376
Q1
2023*
1,673
1,505
1,054
6
4,238
1,752
124
2,486
-392
2,682
2,877
286,309
261,716
1,638
328,007
276,306
28,043
40,589
1.09
22.7
26.4
43.3
2,082
307,127
278,819
1,724
378,066
320,672
29,356
39,882
0.97
24.9
28.9
41.3
2,079
2,110
1,319
20
527
10
108
2,056
1,610
-38
488
12
83
4,064
4,238
Index
24/23
Q4
2023*
Index
Q1/Q4
Full year
2023*
103
101
77
-
96
100
101
93
96
93
93
94
95
87
86
96
102
-
-
-
-
100
103
82
-
108
83
130
96
1,795
1,816
401
3
4,014
2,125
123
1,889
-205
2,094
308,617
262,741
1,665
382,596
326,147
28,580
40,145
1.10
18.8
20.9
52.9
2,085
2,156
920
76
778
268
159
4,014
96
84
203
-
101
83
102
122
183
128
93
100
98
86
85
98
101
-
-
-
-
100
98
143
26
68
4
68
101
6,935
6,312
2,515
15
15,777
7,397
492
8,380
-367
8,747
308,617
262,741
1,665
382,596
326,147
28,580
40,270
1.06
20.8
21.7
46.9
2,085
8,378
4,628
21
2,334
302
437
15,777
470,681
345,355
374,767
305,956
126
113
442,473
328,584
106
105
442,473
328,584
Total assets under management****
816,036
680,723
120
771,056
106
771,056
*Comparative information has been restated as described in note G2(b)
**The xVA acronym covers Credit (CVA), Debit (DVA), Funding (FVA) and Collateral (ColVA) Valuation Adjustments to the fair value of the derivatives portfolio.
From Q4 2023, FVA is calculated to include both funding cost and funding benefit, and therefore DVA is offset to avoid double countin g between DVA and the
funding benefit. 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.
***The split of assets under management between institutional and retail clients was adjusted in Q2 2023, and comparative information has been restated
accordingly.
****Includes assets under management from Group entities.
Danske Bank / Interim report – first quarter 2024 18/66
Overall, credit quality remained strong in the first quarter of
2024 and has proven resilient in the face of external eco-
nomic uncertainty. The minor negative rating trend that was
observed in 2023 due to the macroeconomic situation
turned positive in the first quarter of 2024. Loan impairment
charges in the first quarter amounted to a net reversal of
DKK 376 million (Q1 2023: net reversal of DKK 392 million).
Reversals continue to be driven by successful restructuring
activities.
Credit exposure
Net credit exposure from lending activities amounted to
DKK 623 billion at the end of the first quarter 2024, a de-
crease from DKK 638 billion at the end of 2023, as a de-
crease in the exposure to the Utilities and Infrastructure,
Public Institutions and Financials segments was partially
countered by an increase in the exposure to the Consumer
Goods and Capital Goods segments. Furthermore, we have
actively reduced our net oil-related exposure (excluding oil
majors) by 68% since the fourth quarter of 2019.
Q1 2024 vs Q4 2023
Profit before tax increased to DKK 2,682 million (Q4 2023:
DKK 2,094 million) due primarily to higher net trading in-
come and loan impairment reversals in the first quarter.
• Net interest income decreased to DKK 1,729 million (Q4
2023: DKK 1,795 million) as a result of a decrease in
other interest items.
• Net fee income decreased and stood at DKK 1,521
million (Q4 2023: DKK 1,816 million), mainly as a result
of lower performance fees in Asset Management.
• Net trading income increased to DKK 814 million (Q4
2023: DKK 401 million) due primarily to higher customer
activity and decreased interest rate volatility.
• Operating expenses decreased to DKK 1,758 million (Q4
2023: DKK 2,125 million), with the decrease caused pri-
marily by lower digitisation costs, provisions for sever-
ance pay and performance-based compensation.
• Loan impairment charges amounted to a net reversal of
DKK 376 million (Q4 2023: reversal of DKK 205 million).
Reversals are driven by continued, successful restructur-
ing activities.
Profit before tax
DKK 2,682 million
for the first quarter of 2024
Business initiatives
In the first quarter of 2024, market sentiment in the capital
markets turned more optimistic as the economic outlook in
the Nordic countries was more positive than expected. In
Debt Capital Markets, we saw solid activity in the first quarter
of the year, and we remained the leading Nordic bank in both
Nordic and European debt capital markets in terms of vol-
umes supported. Among other transactions, we supported
Volvo in raising their largest senior unsecured bond issue to
date of EUR 1.3 billion as well as Aalto University Foundation
in raising EUR 150 million.
In Equity Capital Markets, activity remained muted, and with
lower volumes across the Nordic countries than in the same
period last year, although, as a highlight, we supported Better
Collective in their DKK 1.1 billion accelerated bookbuild.
In Asset Management, we saw strong progress on our jour-
ney to simplify our value chain, and we are pleased to report
increasing market shares in Danske Invest. Furthermore, we
remain a leader in external sustainability certifications
among asset managers in the Nordic countries.
Q1 2024 vs Q1 2023
Profit before tax decreased to DKK 2,682 million (Q1 2023:
DKK 2,877 million), caused mainly by lower net trading in-
come.
Net interest income increased to DKK 1,729 million (Q1
2023: DKK 1,673 million) as a result of higher deposit mar-
gins and other interest items. Deposit volumes decreased
15% from the end of 2023 due to seasonality around tax and
dividend payments and volatility in institutional deposits. We
continued to execute on our strategic ambition to grow our
corporate customer portfolio outside Denmark, and we are
thrilled to have welcomed more new large corporate custom-
ers in the first quarter of 2024.
Net fee income increased to DKK 1,521 million (Q1 2023:
DKK 1,505 million), with the increase due primarily to higher
fees from assets under management and cash management
services, although this effect was partly offset by lower capi-
tal markets fees.
We continued to increase our market share in cash manage-
ment by adding new house bank mandates in the first quarter
of 2024. Furthermore, we saw strong growth in assets under
management, partly on the back of rising asset prices, but
also due to a strong development in net sales in the institu-
tional segment, which contributed to positive net sales. Fur-
thermore, we continued to our strong investment perfor-
mance relative to both peers and benchmark, which should
also support future sales.
Net trading income decreased to DKK 814 million (Q1 2023:
DKK 1,054 million) as the first quarter of 2023 was excep-
tional, but also due to lower customer activity and changes in
market conditions.
Operating expenses remained stable and amounted to
DKK 1,758 million (Q1 2023: DKK 1,752 million).
Danske Bank / Interim report – first quarter 2024 19/66
Danica Pension
The stable and positive market trend from the end of 2023 continued into the first quarter of 2024, supported by strong momentum
in the pharmaceutical and tech sectors. The return on our pension customers’ savings was high, driven by the strong performance
of equities. The underlying business continued to be solid, and the result for the first quarter was satisfactory. However, we contin-
ued to see an increase in people suffering from physical or mental health problems, and this had a negative effect on the insurance
result for the health and accident business in the first quarter of 2024.
Net income at Danica Pension amounted to DKK 492 million in the first quarter of 2024, which was at the same level as in the first
quarter of 2023.
Danica Pension
(DKK millions)
Insurance service result
Net financial result
Other income
Net income before tax in Danica Pension
Insurance liabilities
Liabilities under investment contracts
Allocated capital (average)
Net income as % p.a. of allocated capital
Solvency coverage ratio
Full-time-equivalent staff
Asset under management
(DKK millions)
Insurance
Business initiatives
Danica Pension announced a new target for investments in
the green transition of DKK 100 billion by 2030. The new
goal shows our commitment to supporting the path towards
lower carbon emissions and is a doubling of our 2023 goal of
DKK 50 billion. By investing in technology and initiatives
aimed at creating a greener future, we seek to create returns
for our customers while sustaining a safe planet to inhabit.
To further reinforce Danica Pension’s ambition to reduce in-
vestments in fossil fuel companies, we are introducing a new
approach to assessing such companies. Based on the Tran-
sition Pathway Initiative (TPI) and science-based data from
other data sources, the new approach sets an increased
number of requirements that fossil fuel companies must
meet before we will invest in them on behalf of our customers .
As part of the ongoing work to ensure a better balance be-
tween insurance premiums and health and accident claims,
we announced our investment of DKK 100 million in better
preventive healthcare measures. The number of customers
suffering from a loss of earning capacity has recently in-
creased rapidly, causing insurance expenses to rise. The ob-
jective of the new investment is to achieve a decrease in the
number of such customers by offering even better healthcare
solutions to a larger number of customers.
Q1
2024
189
242
60
492
Q1
Index
Q4
Index
Full year
2023
24/23
2023
Q1/Q4
2023
201
289
7
497
94
84
-
99
170
372
8
550
111
65
-
779
615
78
89
1,472
513,309
24,603
497,090
20,604
103
119
493,544
23,113
104
106
493,544
23,113
20,209
19,518
104
20,015
101
19,738
9.7
175
911
10.2
180
902
-
-
-
11.0
170
912
-
-
-
7.5
170
912
460,549
412,906
112
440,319
105
440,319
Q1 2024 vs Q1 2023
Net income at Danica Pension amounted to DKK 492 million
(Q1 2023: DKK 497 million) and was thus at the same level
as in the first quarter of 2023. Other income in the first quar-
ter of 2024 included a reversal of provisions of DKK 50 mil-
lion related to the sale of Danica Norway in 2022.
The insurance service result decreased to DKK 189 million
(Q1 2023: DKK 201 million) as Danica Pension continued to
see a rise in new health and accident claims, which reflects
the general trend in society.
The net financial result decreased to DKK 242 million (Q1
2023: DKK 289 million), although the result continued to re-
flect positive investment results on insurance products
where Danica Pension has the investment risk.
Assets under management increased DKK 48 billion follow-
ing the positive development in the financial markets in 2023
and the first quarter of 2024.
Premiums increased 2% from the same period in 2023 fol-
lowing an increase in both single and regular premiums .
Danske Bank / Interim report – first quarter 2024 20/66
Q1 2024 vs Q4 2023
Net income in Danica Pension decreased to DKK 492
million (Q4 2023: DKK 550 million). The net financial result
decreased due to developments in the financial markets
being less positive than in the fourth quarter of 2023.
•
•
•
The insurance service result saw an
increase of
DKK 19 million as the fourth quarter of 2023 included
provisions for a rise in health and accident claims but
also due to an increase in fees resulting from the positive
developments in the financial markets.
The net financial result decreased in the first quarter of
2024 and amounted to DKK 242 million (Q4 2023:
DKK 372 million) due to a less positive development in
investment results on insurance products where Danica
Pension has the investment risk.
Total premiums increased 14% due to an increase in
both single and regular premiums, which in the first
quarter also included yearly regular premiums from
group life insurance products.
• Assets under management increased DKK 20 billion
due primarily to the developments in the financial
markets in the first quarter of 2024.
Net income in Danica Pension
DKK 492 million
for the first quarter of 2024
Danske Bank / Interim report – first quarter 2024 21/66
Northern Ireland
Our focus in Northern Ireland is to remain a stable, strong and risk-astute bank, consolidating our market-leading position alongside
pursuing select low-cost growth opportunities in the rest of the UK. The strong underlying financial performance reflects business
growth in an environment of higher interest rates.
Profit before loan impairments was in line with the first quarter of 2023, while profit before tax of DKK 457 million was lower,
reflecting a small loan impairment charge.
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
Profit before tax
Q1
2024
Q1
2023
Index
24/23
Q4
2023
Index
Q1/Q4
Full year
2023
710
75
42
3
830
349
481
25
457
599
83
114
5
801
319
482
-24
506
119
90
37
60
104
109
100
-
90
108
98
103
106
661
72
90
2
825
372
453
6
447
58,600
755
97,396
7,592
1.64
23.6
45.1
1,267
107
104
47
150
101
94
106
-
102
102
107
100
81
99
2,549
319
288
15
3,171
1,368
1,804
-113
1,917
58,600
755
97,396
6,750
1.61
28.4
43.1
1,267
Loans, excluding reverse transactions before impairments
Allowance account, loans
Deposits, excluding repo deposits
Allocated capital (average)*
Net interest income as % p.a. of loans and deposits
Profit before tax as % p.a. of allocated capital (avg.)
Cost/income ratio (%)
59,850
805
97,559
6,159
1.75
29.7
42.0
55,435
818
94,667
5,831
1.56
34.7
39.8
Full-time-equivalent staff
1,253
1,305
96
* Allocated capital equals the legal entity’s capital.
Business initiatives
The strategy in Northern Ireland aligns with the Group’s key
focus areas, including digitisation, customer journeys, sus-
tainability, and simplicity and efficiency, all underpinned by en-
suring high levels of employee engagement.
Q1 2024 vs Q1 2023
Profit before tax decreased to DKK 457 million (Q1 2023:
DKK 506 million), with a strong underlying income perfor-
mance excluding the impact of mark-to-market movements in
net trading income.
We are a leading bank in Northern Ireland, serving personal,
business and corporate customers, and the Northern Ireland
market remains our regional focus in the UK, while we also
seek growth in targeted sectors across the rest of the UK.
Net interest income increased to DKK 710 million (Q1 2023:
DKK 599 million), driven by growth in both personal and busi-
ness lending and actions taken in response to higher UK in-
terest rates.
Residential mortgage volumes continued to grow in the first
quarter of 2024 and are much improved year-on-year, sup-
porting continued growth in lending (up 5% in local currency).
We expect demand to remain resilient moving forward.
Net fee income decreased to DKK 75 million (Q1 2023:
DKK 83 million), due primarily to the sale of our offsite ATM
network in 2023, with underlying activity and related fees re-
maining robust.
We have introduced switching incentives in order to attract
new personal and small business transactional accounts.
New customer applications are now facilitated via straight-
through digital processes on our website, which makes it eas-
ier and more convenient for customers to join the bank.
We also continue to support Northern
Ireland society
through our wide-ranging community initiatives. This in-
cludes our Charity Partner for the year, ‘Include Youth’, which
supports local care experienced young people. We focus on
making a difference through fundraising, colleague volunteer-
ing and raising awareness.
Net trading income reflects mark-to-market movements on
the bank’s hedging portfolio on the basis of a combination of
changing market expectations for UK interest rates and the
reducing remaining life of the impacted hedging portfolio.
With market expectations continuing to fluctuate, trading in-
come remained volatile. 2023 saw significant, positive mark-
to-market movements on the portfolio.
Operating expenses stood at DKK 349 million (Q1 2023:
DKK 319 million). The increase reflects the inflationary pres-
sure on locally incurred costs (+4% in local currency). The
bank has a continued cost and efficiency focus across local
and Group cost drivers. The number of full-time-equivalent
staff was lower year-on-year.
Credit quality remained strong, with a small loan impairment
charge of DKK 25 million at the end of the first quarter of
2024, against a net reversal in the first quarter of 2023.
Danske Bank / Interim report – first quarter 2024 22/66
Q1 2024 vs Q4 2023
The first quarter of 2024 saw a profit before tax of DKK 457
million (Q4 2023: DKK 447 million).
•
•
•
•
•
Net interest income increased to DKK 710 million (Q4
2023: DKK 661 million), reflecting balance sheet
growth and higher UK interest rates.
Net fee income increased to DKK 75 million (Q4 2023:
DKK 72 million), reflecting underlying activity levels.
Net trading income amounted to DKK 42 million (Q4
2023: DKK 90 million), reflecting lower positive mark-
to-market movements on the hedging portfolio.
Operating expenses decreased to DKK 349 million (Q4
2023: DKK 372 million), reflecting a continued cost and
efficiency
inflationary pressure
remains.
focus, although
Loan impairment charges were marginally higher at
DKK 25 million, with a continually strong focus on credit
quality.
Profit before tax
DKK 457 million
for the first quarter of 2024
Danske Bank / Interim report – first quarter 2024 23/66
Group Functions
Group Functions includes Group Treasury, Technology & Services and other Group functions. In addition, Group Functions includ es
eliminations. As of 1 January 2024, Non-core is no longer reported as a separate business unit. Instead, the remaining Non-core
activities are included under Group Functions.
In the first quarter of 2024, the loss before tax was reduced and amounted to DKK 564 million , against a loss of DKK 1,240 million
in the first quarter of 2023. The improvement was driven by an increase in net interest income to DKK 265 million [Q1 2023: net
expense of DKK 584 million) that related primarily to Internal Bank activity at Group Treasury.
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.
Profit before loan impairment charges
Loan impairment charges
Profit before tax
Full-time-equivalent staff
Profit before tax
(DKK millions)
Group Treasury
Own shares and issues
Additional tier 1 capital
Group support functions
Non-core
Total Group Functions
Q1
2024
Q1
2023*
Index
24/23
Q4
2023*
Index
Q1/Q4
Full year
2023*
265
-10
-126
-58
72
635
18
-563
-
-564
-584
-8
101
-26
-516
722
26
-1,239
1
-1,240
10,152
10,979
264
-131
-
-769
72
-564
-585
98
-
-724
-30
-1,240
-
125
-
223
-
88
69
45
-
45
92
-
-
-
106
-
45
105
-46
-62
-63
-67
-44
18
-23
2
-25
252
22
203
92
-
-
100
-
-
-
-362
-92
-444
15
-884
1,998
72
-2,882
-1
-2,881
10,046
101
10,046
301
-38
1
-257
-32
-25
88
-
-
299
-
-752
23
-
-2,065
-87
-
-2,881
*Comparative information has been restated as described in note G2(b)
Business initiatives
Group Functions supports, among other things, the business
units by allocating capital, interest-bearing capital costs and
long-term funding costs through Group Treasury’s Internal
Bank setup. Group Treasury also manages, among other
things, the Group’s liquidity bond portfolio and the investment
of shareholders’ equity for Realkredit Danmark as well as the
interest rate risk on the non-trading book. Operating ex-
penses related to the sub-units within Group Functions are
allocated to the business units. This is done to ensure cost
efficiency throughout the Group.
Furthermore, Group Functions comprises the Non-core ac-
tivities. Non-core mainly comprises legacy credit exposures
as well as non-strategic private equity investments and fo-
cuses on actively managing down legacy assets and portfo-
lios by way of divestment, refinancing with other credit insti-
tutions or amortisation.
The winding up of the remaining Non-core activities is pro-
ceeding according to plan.
Q1 2024 vs Q1 2023
Group Functions posted a loss before tax of DKK 564 million
(Q1 2023: loss of DKK 1,240 million).
Net interest income increased to DKK 265 million (Q1 2023:
net expense of DKK 584 million). The increase was due pri-
marily to higher interest on shareholders’ equity and higher
income from Internal Bank allocation, with the latter increase
being due, among other things, to the allocation from May
2023 of interest rate risk management costs related primar-
ily to the hedging of the interest rate risk on deposits to the
business units. Allocation is made in the form of an internal
deduction from deposit margins.
Net trading income decreased to a loss of DKK 126 million
(Q1 2023: DKK 101 million). The decrease was due primarily
to negative market value adjustments at Group Treasury.
Operating expenses, after allocation to the business units, de-
creased from the level in the first quarter of 2023 and
amounted to DKK 635 million (Q1 2023: DKK 722 million).
Loan impairment charges amounted to DKK 0 million (Q1
2023: DKK 1 million).
The number of full-time-equivalent staff decreased to 10,152
(end-Q1 2023: 10,979), mainly because of the sale of
Danske IT in India to Infosys during the third quarter of 2023 .
Danske Bank / Interim report – first quarter 2024 24/66
Q1 2024 vs Q4 2023
Group Functions posted a loss before tax of DKK 564
million (Q4 2023: loss of DKK 25 million) related mainly to
operating expenses that reached a normalised level in the
first quarter relative to the low level in the fourth quarter.
•
•
•
•
Net interest income increased to DKK 265 million (Q4
2023: DKK 105 million). The
increase was due
primarily to higher Group Treasury interest rate risk
management income.
Net trading income decreased to a loss of DKK 126
million (Q4 2023: loss of DKK 62 million). The decrease
was due primarily
to negative market value
adjustments of cross-currency swaps at Group
Treasury.
Operating expenses, after allocation to the business
units, reflected a normalised level and amounted to
DKK 635 million relative to the low level in the fourth
quarter (Q4 2023: net income of DKK 44 million).
Loan impairment charges amounted to DKK 0 million
(Q4 2023: DKK 2 million).
Profit before tax
DKK -564 million
for the first quarter of 2024
Danske Bank / Interim report – first quarter 2024 25/66
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 resul ts
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. There is no difference between the financial high lights
and the IFRS income statement.
Definitions of additional ratios presented on page 3 and in other sections of the Management’s report:
Ratios and key figures
Definition
Dividend per share (DKK)
Total dividend per share in the annual report, consisting of the interim dividend per share (if any) paid
out during the year, and the dividend per share proposed in the Annual Report and paid to sharehold-
ers in the subsequent year.
Return on average shareholders’ equity (% p.a.)
Net profit as disclosed in the financial highlights divided by the average of the quarterly average share-
holders’ equity (beginning and end of each quarter) within the year. The denominator represents eq-
uity equal to an increase in the average of the quarterly average equity of DKK 0 million (2023: a
reduction of 540 million) compared to a simple average of total equity (beginning and end of the pe-
riod).
Net interest income as % p.a. of loans and deposits
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 2024 would be 1.36% (2023: 1.26%) due to the daily average of the sum of lo ans and
deposits being DKK 36.4 billion higher (2023: DKK 45.1 billion lower) than if calculating the ratio by
applying the end-of-period sum of loans and deposits. 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.
Cost/income ratio (C/I), (%)
Operating expenses divided by total income.
Book value per share
Shareholders’ equity 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. The nu-
merator is the loan impairment charges of DKK 101 million (2023: DKK 262 million) annualised. The
denominator is the sum of Loans at amortised cost of DKK 918.6 billion (2023: DKK 1,082.8 billion),
Loans at fair value of DKK 753.3 billion (2023: DKK 724.1 billion), Assets held for sale of DKK 110.4
billion (2023: DKK 0 billion) and guarantees of DKK 75.9 billion (2023: DKK 81.4 billion) at the begin-
ning of the year, as disclosed in the column “Lending activities” in the “Breakdown of credit exposure”
table in the notes to the financial statements. The ratio is calculated for each business unit.
Allowance account as % of net credit exposure
This ratio is calculated on the basis of the allowance account and loans and guarantees. The numera-
tor is the allowance account of DKK 20.3 billion (2023: DKK 20.1 billion) at the end of the period, as
disclosed in the “Allowance account broken down by segment” table in the notes to the financial state-
ments. The denominator is the sum of Loans at amortised cost of DKK 887.3 billion (2023: DKK
918.6 billion), Loans at fair value of DKK 746.6 billion (2023: DKK 753.3 billion), Assets held for sale
of DKK 96.2 billion (2023: DKK 110.4 billion) and guarantees of DKK 76.2 billion (2023: DKK 75.9
billion) at the end of the period, as disclosed in the column “Lending activities” in the “Breakdown of
credit exposure” table in the notes to the financial statements. The ratio is calculated for each busi-
ness unit.
Financial Statements
Income statement – Dans ke Bank Gro up
Statement of comprehensive income – Danske Bank Group
Balance sheet – Danske Bank Group
Statement of capital – Dans ke Ba nk Group
Cash flow statement – Dans ke Bank Group
27
28
29
30
32
Notes
33
Note G 1: Significant accounting policies and estimates
Note G2: Changes in accounting policies,
35
financial highlights a nd segment reporting
38
Note G 3: Business segments
40
Note G 4: Income
Note G5: Loan impairment charges and reconciliation of total allowance account 41
42
Note G6: Issued bonds, subordinated debt and additional tier 1 capital
43
Note G7: Assets held for sale and Liabilities in disposal groups held for sale
44
Note G 8: Ot her assets a nd Ot her liabilities
44
Note G 9: Foreign c urrency translation reserve
45
Note G10: Guarantees, commitments and contingent liabilities
47
Note G 11: Assets provided or received as collateral
48
Note G12: Fair value information for financial instruments
51
Note G 13: Risk ma nagement notes
Credit exposure
Counterparty credit risk and credit exposure from trading and
investment Securities
Bond port folio
51
62
62
Income statement – Danske Bank Group
Note
(DKK millions)
Interest income calculated using the effective interest method
Other interest income
Interest expense
Net interest income from banking activities
G4
G4
G4
Fee income
Fee expenses
Net fee income
Net trading income or loss
Insurance revenue
Insurance service expenses
Net return on investments backing insurance liabilities
Net finance income or expense from insurance
Other insurance related income
Net insurance result
Gain or loss on sale of disposal groups
Other income
G4
Total other income
Total income
Operating expenses
Profit before loan impairment charges
Loan impairment charges
G5
Profit before tax
Tax
Net profit
Earnings per share (DKK)
Diluted earnings per share (DKK)
Dividend per share (DKK)
* Comparative information has been restated, as described in note G2(a).
Danske Bank / Interim report – first quarter 2024 27/66
Q1
2024
16,842
6,358
14,058
9,142
4,516
1,140
3,376
769
1,507
1,305
19,626
-19,384
48
492
20
156
176
Q1
2023*
13,029
3,405
8,414
8,021
4,066
814
3,252
1,331
1,269
1,057
7,871
-7,582
-4
497
-
292
292
13,955
13,394
6,337
7,618
101
7,517
1,888
5,629
6,292
7,101
147
6,954
1,787
5,167
6.6
6.5
-
6.0
6.0
-
Full year
2023*
60,842
15,232
41,102
34,972
17,108
4,203
12,904
2,613
5,735
5,094
35,228
-34,613
216
1,472
-555
1,015
460
52,422
25,478
26,944
262
26,682
5,420
21,262
24.8
24.7
14.5
Statement of comprehensive income – Danske Bank Group
Danske Bank / Interim report – first quarter 2024 28/66
(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
Reclassification to the income statement on disposal 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
Q1
2024
5,629
32
5
27
-1,780
921
-
-178
13
-237
-787
-759
4,870
Q1
2023
5,167
17
20
-3
-2,374
1,163
-
124
1
-244
-842
-845
Full year
2023
21,262
-1,220
-301
-919
-1,404
589
806
1,114
106
306
905
-14
4,322
21,248
* A positive amount is a tax expense, and a negative amount is a tax income.
** Reclassified to the income statement on disposal of units out Denmark in 2023 includes a reduction in the structural FX hedge. See note G9.
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 investment contracts
Insurance assets
Assets held for sale
Intangible assets
Tax assets
Other assets
Total assets
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 investment contracts
Insurance liabilities
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
Total equity
Total liabilities and equity
G7
G8
G6
G6
G7
G8
G6
G6
G9
Danske Bank / Interim report – first quarter 2024 29/66
31 March
2024
31 December
2023
31 March
2023
201,092
153,967
487,028
276,156
887,311
970,142
73,717
514,238
96,472
6,046
10,662
32,978
259,156
114,813
548,189
283,914
918,628
928,239
70,900
496,031
110,704
6,064
3,264
31,079
271,802
71,488
569,576
291,938
1,043,465
940,240
66,778
497,029
284
6,061
4,224
28,522
3,709,808
3,770,981
3,791,407
173,742
398,322
1,171,291
749,118
221,647
74,544
500,719
53,522
1,722
66,028
86,062
39,674
154,608
454,487
1,222,203
748,780
214,234
71,253
482,630
56,476
1,557
57,046
93,194
38,774
147,548
510,300
1,272,770
736,046
214,367
67,548
480,034
-
2,373
59,335
98,187
38,324
3,536,391
3,595,242
3,626,832
8,622
-3,498
-471
168,764
-
8,622
-2,639
-306
163,596
6,466
8,622
-3,841
-1,401
161,195
-
173,417
175,739
164,575
3,709,808
3,770,981
3,791,407
Danske Bank / Interim report – first quarter 2024 30/66
Statement of capital – Danske Bank Group
Changes in equity
(DKK millions)
Total equity as at 1 January 2024
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
Dividends paid
Acquisition of own shares
Sale of own shares
Total equity as at 31 March 2024
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
Sale of own shares
Share
capital
8,622
-
-
-
-
-
-
-
-
-
-
-
-
8,622
8,622
-
8,622
-
-
-
-
-
-
-
-
-
-
-
Shareholders of Danske Bank A/S (the Parent Company)
Foreign
currency
translation
reserve
Reserve for
bonds at fair
value (OCI)
Retained
Proposed
earnings
dividends
Total
-2,639
-306
163,596
6,466
175,739
-
-
5,629
-
-1,780
921
-
-
-
-859
-859
-
-
-
-3,498
-2,630
-
-2,630
-
-
-2,374
1,163
-
-
-
-1,211
-1,211
-
-
-
-
-
-178
13
-
-165
-165
-
-
-
32
-
-
-
-
232
265
5,894
39
-7,950
7,184
-471
168,764
-1,526
-
-1,526
-
-
-
-
124
1
-
125
125
-
-
155,852
-40
155,812
5,167
17
-
-
-
-
224
241
5,408
-8,762
8,738
-
-
-
-
-
-
-
-
-
-6,466
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
5,629
32
-1,780
921
-178
13
232
-759
4,870
-6,427
-7,950
7,184
173,417
160,318
-40
160,278
5,167
17
-2,374
1,163
124
1
224
-845
4,322
-8,762
8,738
164,575
Total equity as at 31 March 2023
8,622
-3,841
-1,401
161,195
Share buy-back programme
On 5 February 2024, the Group initiated a share buy-back programme of DKK 5.5 billion, which may run until 4 February 2025. At the end of March
2024, the Group had acquired 3,978,240 shares for a total amount of DKK 793.7 million under the share buy-back programme based on trade date.
Dividend
The general meeting on 21 March 2024 adopted the Board of Directors’ proposal for payment of DKK 7.5 per share for the second half of 2023. This is
in addition to the interim dividend payment of DKK 7.0 per share that was paid in connection with the interi m report for the first half of 2023. The total
dividend paid for 2023 was therefore DKK 14.5 per share.
Statement of capital – Danske Bank Group
Number of shares
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
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 quarter 2024 31/66
31 March 2024 31 December 2023
8,621,846,210
862,184,621
856,269,693
858,473,949
860,255,227
8,621,846,210
862,184,621
859,773,706
858,899,954
860,043,309
31 March 2024 31 December 2023
173,417
210
-27
173,600
173,600
-5,320
743
-825
-
-3,378
-5,404
-2,819
243
-576
-878
-5,576
175,739
211
-27
175,923
175,923
-914
1,634
-890
-
-6,466
-5,690
-916
316
-733
-845
-6,111
149,810
10,061
159,871
26,472
186,343
809,090
18.5%
19.8%
23.0%
155,308
14,805
170,113
20,790
190,902
827,882
18.8%
20.5%
23.1%
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 availabl e 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
Cash flow from operations before changes in operating capital
Changes in operating capital
Amounts due to/from credit institutions and central banks
Trading portfolio
Acquisition/sale of own shares
Investment securities
Loans at amortised cost and fair value
Deposits
Issued bonds at amortised cost and fair value
Insurance assets/liabilities
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 subordinated debt
Redemption of subordinated debt
Issue of non-preferred senior bonds
Redemption of non-preferred senior bonds
Dividends paid
Share buy-back programme
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
Danske Bank / Interim report – first quarter 2024 32/66
Q1
2024
7,517
-9,396
-2,249
-4,128
20,925
4,997
28
7,758
3,493
-52,891
7,020
-1,367
11,161
Q1
2023
6,954
-808
1,819
7,965
9,644
25,202
-24
-4,515
31,643
10,477
32,928
-2,891
-7,627
Full Year
2023
26,682
-4,565
8,426
30,543
10,778
-9,225
53
3,509
57,952
-9,490
73,513
1,903
-18,036
-3,004
102,802
141,500
26
-134
-105
1
-212
5,590
-5,155
14,157
-21,532
-6,427
-794
-151
-14,312
365,609
409
-17,528
-
-132
-326
3
-455
-
-
8,678
-2,847
-
-
-148
5,683
232,531
296
108,030
45
-540
-841
7
-1,329
-
-
22,425
-23,696
-6,011
-
-605
-7,887
232,531
794
132,284
348,490
340,857
365,609
6,238
194,854
147,398
6,516
265,286
69,055
6,419
252,737
106,453
348,490
340,857
365,609
Danske Bank / Interim report – first quarter 2024 33/66
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 Dan ish disclosure require-
ments for listed financial companies. The report is condensed and should be read in conjunction with the Group’s Annual Repor t 2023.
With effect from 1 January 2024, the Group has aligned its IFRS financial statements and Financial highlights. The alignment has been applied retro-
spectively, resulting in reclassifications between lines in the IFRS Income statement. The reclassifications have no impact on the net profit, Balance sheet
or Equity for 2023. In addition, amendments to IFRS 16, IAS 1 and IAS 7 became effective, and have no impact on the financial statements. Further
information on the changes to accounting policies and presenta tion in 2024 can be found in note G2(a). Except for these changes, the Group has not
changed its significant accounting policies from those applied in Annual Report 2023. Annual Report 2023 provides a full desc ription of the significan t
accounting policies.
Financial statement figures are stated in Danish kroner and whole millions, unless otherwise stated. As a result, rounding di screpancies may occur
because totals have been rounded off and the underlying decimals are not presented to financial statement use rs. The interim report for the first quarter
of 2024 has not been audited or reviewed.
(b) Significant accounting estimates and judgements
The preparation of financial information requires, in some cases, the use of judgements and estimates by management. This inc ludes 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 expla ined in note G15 of the Annua l
Report 2023) and the designation of financial liabilities at fair value through profit or loss to eliminate or significantly reduce an accounting m ismatc h
(further explained in note G16 of the Annual Report 2023). An overview of the classification and measurement basis for fina ncial instruments can be
found in note G1(c) of the Annual Report 2023.
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 val ues. 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 co st 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 in itial recognition .
If the credit risk has not increased significantly, the impairment charge equals the expected credit l osses 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 default or
otherwise impaired, the impairment charge equals the lifetime expected credit losses (stages 2 and 3). In determining the impairment for expected 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), exposur e at default (EAD) and loss given
default (LGD) and incorporate forward-looking information. The estimation of expected credit loss es 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 unce rtainty 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), includ ing 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 G13 provides information on the scenarios as at 31 March 2024.
The base case scenario enters with a probability of 60% (31 December 2023: 60%), the upside scenario with a probability of 20 % (31 December 2023:
20%) and the downside scenario with a probability of 20% (31 December 2023: 20%). On the basis of these assess ments, the allowance account as at
31 March 2024 amounted to DKK 20.3 billion (31 December 2023: DKK 20.1 billion). If the base case scenario was assigned a pro bability of 100%, the
allowance account would decrease DKK 1.9 billion (31 December 2023: DKK 2. 0 billion). Compared to the base case scenario, the allowance account
would increase DKK 9.7 billion (31 December 2023: DKK 10.2 billion), if the downside scenario was assigned a probability of 1 00%. 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 DKK 0.2 billion (31 December 2023: DKK 0.2 billion) comp ared to the base case
scenario.
Management applies judgement when determining the need for post-model adjustments. As at 31 March 2024, the post-model adjustments amounte d
to DKK 6.7 billion (31 December 2023: DKK 6.7 billion) which are predominantly linked to macroeconomic uncertainties related to inflation and increas-
ing 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 G13.
Note G15 of the Annual Report 2023 and the section on credit risk in note G13 in the Interim report – first quarter 2024 provide more details on
expected credit losses. As at 31 March 2024, financial assets covered by the expected credit loss model account ed for about 54.9% of total assets (31
December 2023: 54.8%).
Danske Bank / Interim report – first quarter 2024 34/66
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 March 2024, 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 incl ude 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 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
31 March 2024, the adjustments totalled DKK 0.3 billion (31 December 2023: DKK 0.4 billion), including the adjustme nt for credit risk on derivative s
that are credit impaired. Note G12 of this report and note G33(a) of the Annual Report 2023 provides more details on the fair value measurement of
financial instruments.
Measurement of goodwill
Goodwill is tested for impairment once a year or more frequently if indications of impairment exist. Impairment testing requi res management to estimate
the present value of future cash flows. A number of factors affect the value of such cash flows, includi ng discount rates, changes in the economic outlook,
customer behaviour and competition. At 31 March 2024, goodwill amounted to DKK 4.4 billion (31 December 2023: 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 m arket value of assets under management,
major restructurings, macroeconomic developments etc. No indications of impairment have been noted at the end of March 2024.
Goodwill mainly consists of DKK 2.1 billion (31 December 2023: DKK 2.1 billion) in Markets, DKK 1.8 billion (31 December 2023 : DKK 1.8 billion) in
Asset Management and DKK 0.5 billion (31 December 2023: 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 2023.
Note G19 of the Annual Report 2023 provides more information about impairment testing and sensitivity to changes in assumptio ns.
Measurement of liabilities under insurance contracts (part of Insurance liabilities)
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 futur e cash flows for insur-
ance contracts, adjusted for time value of money and effect of financial risk including a risk adjustment for non -financial risk, and a contractual service
margin (CSM).
Estimates of future cash flows include actuarial computations that rely on estimates of a number of variables such as mortali ty rates and disability rates.
Mortality rates are based on the Danish FSA’s benchmark, whilst others are estimated based on data f rom the Group’s own portfolio of insurance con-
tracts.
The discount rate is fixed on the basis of a zero-coupon yield curve, which is adjusted by a currency and credit risk deduction and a volatility adjustment.
The yield curve is calculated according to principles and based on data that results in a curve bas ed on European Insurance and Occupational Pension
Authority (EIOPA) discount yield curve, which can be found at eiopa.europa.eu/tools-and-data/risk-free-in terest-ra te-term-s tructures_en.
For life insurance contracts, risk adjustment for non-financial risks is calculated based on a safety margin on applied actuarial assumptions, such as
mortality rates and longevity. The confidence level used to determine the risk adjustment is at least 85% . For insurance contracts measured using VFA,
CSM is calculated on the basis of stochastic models, whereas a deterministic model is used for life insurance contracts measu red using GMM.
For health and accident insurance contracts, the loss element includes expectations about mortality, reactivation, reinstatem ent and repurchase, as well
as expected costs offset by premiums not yet due. Risk adjustment for non -financial risk is calculated based on a safety margin on applied actuaria l
assumptions. The confidence level used to determine the risk adjustment is at least 85%.
Note G18 of the Annual Report 2023 provides more information about liabilities under insurance contracts.
Danske Bank / Interim report – first quarter 2024 35/66
Notes – Danske Bank Group
G2. Changes in accounting policies, financial highlights and segment reporting
(a) Changes in accounting policies
With effect from 1 January 2024, the Group has aligned its IFRS financial statements and Financial highlights in order to pre sent them on the same
basis. The alignment has been applied retrospectively, resulting in reclassifications between lines in the 20 23 IFRS Income statement as described
below.
Markets (part of Large Corporates & Institutions) and Group Treasury (part of Group Functions)
Under IFRS 9, the financial assets in Markets are mandatorily measured at fair value through profit or loss (FVPL) due to hav ing a business model that
is neither “hold to collect” nor “hold to collect and sell”. The Group has aligned presentation of income in Markets with its business model; as such, all
income and expenses in Markets (including interest on the net funding of operations in Markets) have been changed to be prese nted as Net trading
income, except any fixed income from customer transactions (presented as interest or fee income depending on the customer agreement).
Group Treasury holds portfolios of financial assets with the business model “hold to collect”, “hold to collect and sell” and “other” under IFRS 9 within
Internal Bank and financial assets mandatorily measured at fair value through profit or loss (FVPL) ou tside Internal Bank. To align the income in Group
Treasury with its business models, all income at Internal Bank remains presented by the type of income, whereas all other inc ome in Group Treasury
(including interest on the net funding of investments in Group Treasury) is presented as Net trading income.
Operating leases
Under IFRS, gains or losses on the sale of operating lease assets (excluding properties) is to be presented on a gross basis if an entity routinely sells
items of property, plant and equipment that have been held for rental purposes as part of its ordinary activities. The Group has assessed that, although
it does sell operating lease assets (primarily leased cars) that have previously been held for rental, this is not a primary activity of the Group. Therefore
gains and losses on the sale of operating lease activities have been changed in 2024 to be presented on a net basis in the IFRS income statement. This
results in the income from lease assets sold in 2023 being reclassified from Other income to Operating expenses .
Margins on customer transactions in foreign currencies
The Group has changed the presentation of its fixed margin on customer transactions in foreign currencies from Net trading in come to Fee income,
because it is a fee in substance. This income in 2023 has been reclassified.
The table below shows the impacts described above on the first quarter 2023 IFRS Income statement and full year 2023 IFRS Inc ome statement.
Danske Bank / Interim report – first quarter 2024 36/66
Notes – Danske Bank Group
G2. Changes in accounting policies, financial highlights and segment reporting continued
The table below shows the impact of the alignment on the IFRS income statement for the first quarter 2023 and full -year 2023.
(DKK millions)
Q1 2023
Markets
and Group
Treasury
Operating-
leases
Margins on
customer
transactions
in foreign
currencies
Restated
Q1 2023
Full year
2023
Markets
and Group
Treasury
Operating
leases
Margins on
customer
transactions
in foreign
currencies
Restated
Full year
2023
Interest income calculated us-
ing the effective interest
method
Other interest income
Interest expense
Net interest income from
banking activities
Fee income
Fee expenses
Net fee income
13,029
5,102
-
-1,697
10,398
-1,985
7,734
3,844
884
2,960
287
-40
-70
30
Net trading income or loss
1,910
-317
Insurance revenue
Insurance service expenses
Net return on investments
banking insurance liabilities
Net finance income or expense
from insurance
Other Insurance related in-
come
Net insurance result
Gain or loss on sale of disposal
groups
Other income
Total other income
Total income
Operating expenses
Profit before loan impairment
charges
Loan impairment charges
Profit before tax
Tax
Net profit
1,269
1,057
7,871
-7,582
-4
497
-
1,184
1,184
14,285
7,183
7,101
147
6,954
1,787
5,167
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-891
-891
-891
-891
-
-
-
13,029 60,842
-
-
-
3,405 18,752
8,414 47,325
-3,520
-6,224
-
8,021 32,269
2,704
262
-
4,066 16,111
4,481
814
-52
-278
262
3,252 11,630
225
-262
1,331
6,590
-2,928
1,269
1,057
5,735
5,094
7,871 35,228
-7,582
-34,613
-4
216
497
1,472
-
-555
292
4,446
292
3,891
13,394 55,852
6,292 28,908
7,101 26,944
262
147
6,954 26,682
1,787
5,420
5,167 21,262
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-3,431
-3,431
-3,431
-3,431
-
-
-
-
-
60,842
- 15,232
- 41,102
- 34,972
1,049 17,108
4,203
-
1,049 12,904
-1,049
2,613
5,735
5,094
35,228
-34,613
216
1,472
-555
1,016
460
52,422
25,478
26,944
262
26,682
5,420
21,262
Amendment to IFRS 16, Leases
The amendment to IFRS 16 clarifies how a seller-lessee should apply subsequent measurement requirements in IFRS 16 to the lease liability that arises
in a sale and leaseback transaction. The seller-lessee must measure the lease liabilities arising from the leaseback transactions such that it does not
recognise any gain or loss that relates to the right of use it retains.
The amendment has no impact on the financial statements.
Danske Bank / Interim report – first quarter 2024 37/66
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 the settlement of the liability. In
addition, this amendment clarifies how conditions with which an entity must comply within twelve months after the reporting p eriod affect the classifica-
tion of a liability.
The second amendment clarifies that only covenants with which an entity must comply on or before the reporting date affect th e classification of the
liability as current or non-current. In addition, an entity must disclose information in the notes that ena bles users of the financial statements to understan d
the risk that non-current liabilities with covenants could become repayable within twelve months.
The amendments have no impact on the financial statements.
Amendment to IAS 7, Statement of cash flows, and IFRS 7, Financial instruments: disclosures
The amendments to IAS 7 and IFRS 7 requires entities to provide additional disclosures about supplier finance arrangements, in order to assess how
the arrangements affect the entity’s liabilities and cash flows, and to allow users of the financial statements to understand the effect of supplier finance
arrangements on the exposure to liquidity risk, and how the entity may be affected if it no longer has access to the arrangements.
The amendments have no impact on the financial statements.
b) Changes in financial highlights and segment reporting
With effect from 1 January 2024, the Group implemented the following changes to the financial highlights in order to align wi th IFRS reporting.
•
•
•
Non-core has ceased to exist as a separate segment, and is now a sub-segment of Group Functions. Therefore income, expenses, assets and
liabilities in the former Non-core segment have been reclassified to the relevant lines within Group Functions.
Assets and liabilities that are reported in the IFRS Balance sheet as Assets held for sale and Liabilities in disposal groups held for sale are
presented within Other assets and Other liabilities respectively in the Financial highlights’ balance sheet.
Various minor adjustments to align with IFRS reporting.
The changed presentation of fixed margin on customer transactions in foreign currencies described in note G2 (a) reclassifies an amount of DKK 262
million from Net trading income to Fee income for Q1 2023. The other adjustments lead to only minor changes in the comparativ e figures for Q1 2023.
.
Danske Bank / Interim report – first quarter 2024 38/66
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 Group Functions.
Business segments Q1 2024
(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.
Profit before loan impair-
ment charges
Loan impairment charges
Profit before tax
Loans, excluding reverse
transactions
Other assets
Total assets
Deposits, excluding repo de-
posits
Other liabilities
Allocated capital
Personal
Customers
Business
Customers
Large
Corporates &
Institutions
Danica
Northern
Ireland
Group
Functions
Eliminations
Total
3,544
1,199
34
-
15
4,793
2,320
2,893
591
5
-
216
3,705
1,275
1,729
1,521
814
-
-
4,064
1,758
41
62
125
2,472
-256
2,729
2,430
709
1,721
2,306
-376
2,682
-
-
-
492
-
492
-
-
492
-
492
710
75
42
-
3
830
349
-
481
25
457
313
-65
-74
-
531
705
1,205
18
-499
-
-500
-47
55
-52
-
-589
-633
-570
-
-64
-
-64
9,142
3,376
769
492
176
13,955
6,337
246
7,618
101
7,517
651,545
471,309
637,528
179,817
284,671
3,079,840
-
561,371
59,045
59,589
12,021
4,699,200
-12,834
-6,973,295
1,631,975
2,077,832
1,122,854
817,345
3,364,511
561,371
118,634
4,711,221
-6,986,129
3,709,808
376,656
715,539
30,659
252,031
523,341
41,973
328,007
2,996,060
40,444
-
561,371
-
97,559
15,044
6,032
6,722
4,650,190
54,309
-10,734
-6,975,395
-
1,050,241
2,486,150
173,417
Total liabilities and equity
1,122,854
817,345
3,364,511
561,371
118,634
4,711,221
-6,986,129
3,709,808
Profit before tax as % p.a. of
allocated capital (avg.)
Cost/income ratio (%)
Full-time-equivalent staff,
end of period
35.1
48.4
16.4
34.4
26.4
43.3
9.7
-
29.7
42.0
-4.9
-
4,009
1,687
2,082
911
1,253
10,152
-
-
-
17.2
45.4
20,094
* Net income from insurance business in the financial highlights is equivalent to Net insurance result in the IFRS financial statements.
** Other income in the financial highlights is equivalent to Total other income in the IFRS financial statements.
Danske Bank / Interim report – first quarter 2024 39/66
Notes – Danske Bank Group
G3. Business segments continued
Business segments Q1 2023
Personal
Customers*
Business
Customers*
Large
Corporates &
Institutions*
Danica
Northern
Ireland
Group
Functions* Eliminations*
(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.
Profit before loan impair-
ment charges
Loan impairment charges
Profit before tax
Loans, excluding reverse
transactions
Other assets
Total assets
Deposits, excluding repo de-
posits
Other liabilities
Allocated capital
3,405
1,104
53
-
20
4,583
2,253
2,927
568
10
-
287
3,792
1,246
1,673
1,505
1,054
-
6
4,238
1,752
41
63
124
2,330
412
1,918
2,546
149
2,396
2,486
-392
2,877
-
-
-
497
-
497
-
-
497
-
497
599
83
114
-
5
801
319
-544
-53
116
-
640
159
1,373
-39
45
-15
-
-666
-675
-651
Total*
8,021
3,252
1,331
497
292
13,394
6,292
-
26
-
254
482
-24
506
-1,215
1
-1,215
-24
-
-25
7,101
147
6,954
783,836
335,125
626,795
195,327
305,403
3,426,244
-
560,843
54,617
59,654
27,709
4,455,822
-27,412
-7,012,557
1,770,948
2,020,458
1,118,961
822,121
3,731,648
560,843
114,271
4,483,531
-7,039,968
3,791,407
411,316
678,247
29,398
279,388
503,235
39,498
378,066
3,313,558
40,024
-
542,238
18,605
94,667
14,073
5,531
5,628
4,446,384
31,519
-10,662
-7,029,307
-
1,158,404
2,468,428
164,575
Total liabilities and equity
1,118,961
822,121
3,731,648
560,843
114,271
4,483,531
-7,039,968
3,791,407
Profit before tax as % p.a. of
allocated capital (avg.)
Cost/income ratio (%)
Full-time-equivalent staff,
end of period
25.8
49.2
24.3
32.9
28.9
41.3
10.2
-
34.7
39.8
-14.3
-
4,277
1,664
2,079
902
1,305
10,979
-
-
-
17.1
47.0
21,205
* Comparative information has been restated, as described in note G2(b).
** Net income from insurance business in the financial highlights is equivalent to Net insurance result in the IFRS financial statements.
*** Other income in the financial highlights is equivalent to Total other income in the IFRS financial statements.
Danske Bank / Interim report – first quarter 2024 40/66
Notes – Danske Bank Group
G4. Income
(a) Fee income
Note G6 of the Annual Report 2023 provides additional information on the Group’s accounting policy for fee income, including the description by fee type.
Fee income Q1 2024
(DKK millions)
Investment
Money transfers, account fee, cash management and other fees
Lending and Guarantees
Capital markets
Total
Fee income Q1 2023
(DKK millions)
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).
(b) Other income
Fee income
Fee expense
Net fee income
1,996
1,559
628
333
4,516
862
226
34
19
1,140
1,135
1,334
594
315
3,376
Fee income*
Fee expense*
Net fee income*
1,570
1,463
672
362
4,066
523
240
27
24
814
1,046
1,223
645
338
3,252
Other income amounted to DKK 156 million for Q1 2024 (Q1 2023: DKK 292 million). Other income includes net income from lease assets, investme n t
property and real estate brokerage, and income from holdings in associates.
Danske Bank / Interim report – first quarter 2024 41/66
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 adjustme nts 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 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
ECL allowance account as at 31 March 2023
ECL allowance account as at 1 January 2024
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 31 March 2024
Q1 2024
Q1 2023
1,048
-954
383
26
-325
-77
101
747
-807
315
300
-337
-71
147
Stage 1
Stage 2
Stage 3
Total
3,273
864
-162
-10
191
-118
-753
-
-20
-2
8,082
-832
232
-122
358
-385
1,113
-
-66
-1
8,290
-32
-70
131
198
-305
-45
-57
-65
10
19,645
-
-
-
747
-807
315
-57
-150
7
3,263
8,380
8,056
19,699
3,592
7,486
9,062
20,140
484
-161
-7
175
-171
-400
-9
-23
1
-452
279
-169
486
-561
300
-
-100
-
-32
-118
176
387
-221
483
-140
-46
-3
-
-
-
1,048
-954
383
-149
-169
-2
3,480
7,269
9,549
20,297
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 G13.
Notes – Danske Bank Group
G6. 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
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 quarter 2024 42/66
31 March 31 December
2023
2024
745,981
714
2,422
741,062
5,228
2,489
749,118
748,780
31 March 31 December
2024
2023
27,831
70,187
122,247
1,382
221,647
24,419
63,345
124,703
1,766
214,234
86,062
93,194
Further information on issued bonds at fair value through profit or loss can be found in note G16 of the Annual Report 2023. 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
Structured retail notes
Non-preferred senior bonds
Other issued bonds
Nominal value
(DKK millions)
Commercial papers and certificate of deposits
Preferred senior bonds*
Covered bonds
Structured retail notes*
Non-preferred senior bonds
1 January
2024
29,613
65,545
129,419
4,076
97,900
Issued
Redeemed
6,366
6,894
3,631
-
14,210
7,594
197
1,054
395
21,612
Foreign
currency
translation
156
329
-4,657
230
-954
31 March
2024
28,541
72,571
127,338
3,912
89,544
326,553
31,101
30,852
-4,896
321,906
1 January
2023
9,128
52,421
156,740
6,927
100,586
Issued
Redeemed
66,432
39,700
33,000
-
22,500
36,812
25,430
65,850
2,414
23,700
Foreign
currency 31 December
2023
translation
-9,135
-1,146
5,529
-437
-1,486
29,613
65,545
129,419
4,076
97,900
Other issued bonds
325,801
161,633
154,206
-6,675
326,553
* DKK 4.1 billion of Structured retail notes as at 31 December 2023 that were previously included within Preferred senior bonds are now presented separately, There is no impact on total Other
issued bonds.
Subordinated debt and additional tier 1 capital
As at 31 March 2024, the nominal value of subordinated debt, including liability accounted additional tier 1 capital, amounted to DKK 40,821 million (31
December 2023: DKK 40,069 million). During the three months ended 31 March 2024, the Group issued EUR 750 million of tier 2 capital and redeemed
USD 750 million of liability accounted additional tier 1 capital. During 2023, the Group did not issue or redeem any additional tier 1 or tier 2 capital instru-
ments.
For the additional tier 1 capital, Danske Bank A/S may, at its sole discretion, omit interest payments to bondholders. Any in terest payments are paid out of
distributable items, which primarily consist of retained earnings in Danske Bank A/S and Danske Ban k Group. As at 31 March 2024, distributable items for
Danske Bank A/S amounted to DKK 129.7 billion (31 December 2023: DKK 119.2 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 31 March 2024 the common equity tier 1 capital ratio was 21.6% (31 December 2023: 21.9%) for Danske
Bank A/S. The ratios for the Danske Bank Group are disclosed in the Statement of capital.
Notes – Danske Bank Group
G7. Assets held for sale and Liabilities in disposal groups held for sale
(DKK millions)
Assets held for sale
Loans
Other
Total
Liabilities in disposal groups
Deposits
Covered bonds
Total
Danske Bank / Interim report – first quarter 2024 43/66
31 March
2024
31 December
2023
96,235
237
110,415
289
96,472
110,704
28,621
24,902
30,599
25,877
53,522
56,476
Loans held for sale and associated deposits consists of loan portfolios where the Group has entered into sales agreements. As announced in July 2023,
Danske Bank has entered into an agreement to sell its personal customers business Norway. The sale, which includes loans, deposits and covered bonds,
is expected to close during the fourth quarter of 2024.
Assets held for sale also includes lease assets (where the Group acts as 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 es tate agent within 12 months from the date of
acquisition. The properties are primarily in Denmark.
Notes – Danske Bank Group
G8. Other assets and Other liabilities
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
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
Danske Bank / Interim report – first quarter 2024 44/66
31 March 31 December
2023
2024
9,392
10,641
850
156
7,379
4,032
528
7,264
10,811
806
157
7,418
4,010
612
32,978
31,079
41,633
13,282
303
1,400
4,132
3,042
2
2,234
33,005
12,902
301
1,175
4,102
3,161
2
2,398
66,028
57,046
In the table above, Provisions, including litigations includes customer relations, regulatory and legal proceedings, restruct uring costs and other provi-
sions.
G9. Foreign currency translation reserve
As at 31 March 2024, 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 32,979
million (31 December 2023: DKK 37,999 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 o n 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 (Finla nd) is included in the struc-
tural FX hedge position to extend the hedge to the risk exposure amount measured by currency for EUR, NOK and SEK across the entire Group bala nce sheet,
although with constraints to the size of the loans to the foreign branches and the net investments in the foreign subsid iaries. 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 31 March 202 4, the
structural FX hedge position totalled DKK 36,775 million (31 December 2023: DKK 37,641 million) and a loss of DKK 865 million has been recognised in
Other comprehensive income during the first quarter of 2024, primarily due to a weakening of SEK as well as NOK against DKK throughout the first quarter
of 2024. During the first quarter of 2023, a loss of DKK 1,137 million related to the structural FX hedge position was recognised in Other comprehensive
income due to a weakening of NOK against DKK throughout the first quarter of 2023.
Danske Bank / Interim report – first quarter 2024 45/66
Notes – Danske Bank Group
G10. Guarantees, commitments and contingent liabilities
Contingent liabilities consist of possible liabilities arising from past events. The existence of such liabilities will be co nfirmed only by the occurrence or
non-occurrence of one or more uncertain future events not wholly within the Group’s control. Cont ingent 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
31 March
2024
31 December
2023
4,103
72,134
76,237
4,348
71,536
75,883
31 March
2024
31 December
2023
198,450
219,874
16,176
197,007
220,285
16,719
434,500
434,011
In addition to credit exposure from lending activities, loan offers made , and uncommitted lines of credit granted by the Group amounted to DKK 213 billio n
(31 December 2023: DKK 232 billion). These items are included in the calculation of the total risk exposure amount in accorda nce with the CRR.
(c) Regulatory and legal proceedings
Estonia matter
In December 2022, Danske Bank entered into final coordinated resolutions with the US Department of Justice (DoJ), the US Secu rities and Exchange Com-
mission (SEC) and the Danish Special Crime Unit (SCU) following the investigations into failings and miscond uct 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 c oordinated 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 re mediation 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 mil lion. 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, an d 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 p rocedural notification is to
make a formal reservation of rights to bring a potential claim against the notified party. The first c ase 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 t o 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 othe rs. 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.
Danske Bank / Interim report – first quarter 2024 46/66
Notes – Danske Bank Group
G10. Guarantees, commitments and contingent liabilities continued
Other
Owing to its business volume, Danske Bank is continually a party to various other lawsuits and disputes and has an ongoing di alogue 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. Provisio ns for litigations are included in Other
liabilities, see note G8.
(d) Further explanation
A limited number of employees are employed under terms which, if they are dismissed before reaching their normal retirement a ge, grant them a sever-
ance and/or pension payment in excess of their entitlement under ordinary terms of employment. As the sponsor ing 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 leas t 0.8% and 1%, respec-
tively, of the covered deposits of all Danish credit institutions by 31 December 2024. The Danish Guarantee Fu nd 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 i ndividual 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 Resolu tion Fund based
on their size and risk relative to other credit institutions in Denmark. The contribution to the Danish Resolution Fund is recog nised as operating expenses.
If the Resolution Fund does not have sufficient means to make the required payments, extraordinary contributions of up to thr ee times the latest annual
contributions may be required. In addition, Danish banks participate in the Danish Restructuring Fund, w hich 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 ma de 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 based on the individual credit institution’s share of covered deposits relative to other credit institutio n s
in Denmark. However, each institution’s contribution to the Danish Restructuring Fund may not exceed 0.2% of its covered depo sits.
The Group is a member of deposit guarantee schemes and other compensation schemes in Norway and the UK. As in Denmark, the co ntributions to the
schemes in these countries are annual contributions combined with extraordinary contributions if the means of th e 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.
Danske Bank / Interim report – first quarter 2024 47/66
Notes – Danske Bank Group
G11. Assets provided or received as collateral
As at 31 March 2024, the Group had deposited securities (including bonds issued by the Group) worth DKK 5.9 billion as collateral w ith Danish and
international clearing centres and other institutions (31 December 2023: DKK 4.5 billion).
As at 31 March 2024, the Group had provided cash and securities (including bonds issued by the Group) worth DKK 68.5 billion as col lateral for deriv-
atives transactions (31 December 2023: DKK 90.6 billion).
As at 31 March 2024, the Group had registered assets (including bonds and shares issued by the Group) under insurance contrac ts and investme n t
contracts worth DKK 472.4 billion (31 December 2023: DKK 443.2 billion) as collateral for policyholders’ savings of DKK 444.9 billion (31 December
2023: DKK 426.0 billion).
As at 31 March 2024, the Group had registered loans at fair value and securities (including bonds issued by the Group) worth a total of DKK 752.4 billio n
(31 December 2023: DKK 759.6 billion) as collateral for bonds issued by Realkredit Danmark. Similarly, the Group had registered loans and other assets
worth DKK 274.8 billion (31 December 2023: DKK 308.8 billion) as collateral for covered bonds issued under Danish, Finnish an d 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’.
31 March 2024
31 December 2023
(DKK millions)
Repo
Other
Total
Repo
Other
Total
Due from credit institutions
Trading and investment securities
Loans at fair value
Loans at amortised cost
Insurance assets and assets under invest-
ment contracts
-
202,708
-
-
24,755
50,310
746,554
282,980
24,755
253,018
746,554
282,980
-
164,189
-
-
15,922
48,326
753,277
340,297
15,922
212,514
753,277
340,297
-
450,155
450,155
-
420,701
420,701
Total
Own issued bonds
202,708
30,105
1,554,754
1,757,462
164,189
1,578,522
1,742,711
25,623
55,729
33,693
30,665
64,358
Total, including own issued bonds
232,813
1,580,377
1,813,190
197,882
1,609,187
1,807,069
Securities provided as collateral under agreements that entitle the counterparty to sell the securities or provide them as co llateral for other loans
amounted to DKK 202.7 billion as at 31 March 2024 (31 December 2023: DKK 164.2 billion).
As at 31 March 2024, the Group had received securities worth DKK 385.1 billion (31 December 2023: DKK 315.5 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 31 March 2024, the Group had sold securities or provided secu-
rities as collateral worth DKK 131.3 billion (31 December 2023: DKK 113.6 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 G40 of the Annual Report 2023 provide more details on assets received as collateral in connection with ordinary lending
activities.
Danske Bank / Interim report – first quarter 2024 48/66
Notes – Danske Bank Group
G12. 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 held at amortised cost
Investment securities held at fair value
Loans at amortised cost
Loans at fair value
Assets under pooled schemes and investment contracts
Insurance assets
Loans held for sale
Total
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 investment contracts
Liabilities held for sale
Non-preferred senior bonds
Subordinated debt
Loan commitments and guarantees
31 March 2024
31 December 2023
Fair value
instruments
Amortised cost
instruments
Fair value
instruments
Amortised cost
instruments
-
97,702
487,028
-
130,335
-
970,142
73,717
479,175
-
201,092
56,265
-
145,821
-
887,311
-
-
-
96,235
-
92,985
548,189
-
128,516
-
928,239
70,900
460,747
-
259,156
21,829
-
155,398
-
918,628
-
-
-
110,415
2,238,098
1,386,724
2,229,576
1,465,426
105,674
398,323
125,534
749,118
-
74,544
-
-
-
-
68,068
-
1,045,757
-
221,647
-
53,522
86,062
39,674
3,042
85,548
454,487
120,213
748,780
-
71,253
-
-
-
-
69,060
-
1,101,990
-
214,234
-
56,476
93,194
38,774
3,161
Total
1,453,193
1,517,772
1,480,281
1,576,889
The table above does not include Insurance liabilities, which primarily consists of liabilities under insurance contracts mea sured using the General Meas-
urement Model, Variable Fee Approach, or Premium Allocation Approach as defined by IFRS 17.
Investment securities at fair value includes bonds measured at fair value through other comprehensive income, see the table o n bonds in note G13. 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 v alue option.
Financial instruments at fair value
Note G33(a) of the Annual Report 2023 provides more information about fair value calculation methods for financial instrument s.
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 valu e 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 th e year, the classification of the
instrument changes. Changes are considered to have taken place at the balance sheet date. Develop ments 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 t o the Observable inpu t
category, while other bonds have become liquid and have be en moved from the Observable input to the Quoted prices category. The amounts transferred
are insignificant.
Financial instruments at amortised cost
The liquidity portfolio managed by Group Treasury includes a bond portfolio held within a business model for the purpose of c ollecting contractual cash
flows (hold to collect) and with cash flows that are solely payments of principal and interest on the pr incipal amount outstanding, which is measured at
amortised cost. For bonds classified as hold-to-collect, amortised cost exceeded fair value as at 31 March 2024 with DKK 6,717 million (31 December
2023: DKK 6,489 million). This portfolio mainly contains Da nish mortgage bonds and central and local government bonds and has a weighted average
rating factor of 4.5, following Moody’s numerical rating factor to scale, which corresponds to a strong Aa1 rating. The inter est rate risk duration for the
portfolio is 3.2 years. Without any reinvestments, respectively 20%, 57% and 23% 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 Annual Report 2023 provides information on the business models and the difference between the carrying amo unt and the fair value
of financial instruments recognised at amortised cost, respectively.
Danske Bank / Interim report – first quarter 2024 49/66
Notes – Danske Bank Group
G12. Fair value information for financial instruments continued
(DKK millions)
31 March 2024
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 investment contracts
Insurance assets, bonds
Insurance assets, shares
Insurance assets, derivatives
Quoted prices
Observable
input
Non-observable
input
Total
-
9,794
147,858
32,253
104,225
-
-
73,717
188,862
180,950
734
97,702
282,302
13,282
-
25,676
-
970,142
-
17,917
5,774
45,396
-
1,367
-
172
-
434
-
-
2,430
36,426
686
97,702
293,464
161,140
32,425
129,901
434
970,142
73,717
209,209
223,150
46,816
Total
738,393
1,458,191
41,515
2,238,098
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 investment contracts
Total
(DKK millions)
31 December 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 investment contracts
Insurance assets, bonds
Insurance assets, shares
Insurance assets, derivatives
-
10,642
128,994
-
749,118
-
105,674
254,201
2,279
125,534
-
74,544
-
2,201
6
-
-
-
105,674
267,044
131,279
125,534
749,118
74,544
888,754
562,232
2,207
1,453,193
Quoted prices
Observable
input
Non-observable
input
-
6,723
168,031
18,785
100,554
-
-
70,900
189,297
153,310
141
92,985
343,134
9,532
-
27,470
-
928,239
-
22,318
5,121
52,436
-
1,865
-
119
-
493
-
-
2,458
34,755
911
Total
92,985
351,722
177,563
18,904
128,023
493
928,239
70,900
214,073
193,186
53,488
Total
707,741
1,481,235
40,601
2,229,576
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 investment contracts
Total
-
7,360
111,657
-
748,780
-
85,548
331,954
1,853
120,213
-
71,253
867,797
610,821
-
1,604
59
-
-
-
1,663
85,548
340,918
113,569
120,213
748,780
71,253
1,480,281
Danske Bank / Interim report – first quarter 2024 50/66
Notes – Danske Bank Group
G12. 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)
Carrying amount
Increase
Decrease
Realised
Unrealised
Sensitivity (change in fair value)
Gains/losses for the period
31 March 2024
Unlisted shares
allocated to insurance contract policyholders
other
Illiquid bonds
Derivatives, net fair value
31 December 2023
Unlisted shares
allocated to insurance contract policyholders
other
Illiquid bonds
Derivatives, net fair value
36,426
600
2,430
-147
34,755
553
2,458
1,172
-
60
55
-
-
55
56
-
-
60
55
-
-
55
56
-
288
-5
-
-
472
352
2
-
912
19
-27
-310
-522
-160
-152
234
For unlisted shares allocated to insurance contract policyholders, the policyholders assume most of the risk on the shares. T herefore, changes in the fair
value of those shares will only to a limited extent affect the Group’s net profit. The Group’s remain ing 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 uno bservable 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 adjustme nts in the three-month period
ended 31 March 2024 were attributable to various unlisted shares.
The estimated fair value of illiquid bonds depends significantly on the estimated credit spread. In the table, the sensitivit y of the fair value measuremen t
to changes in non-observable input is calculated as a 50bps widening or narrowing of the credit spr ead.
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
31 March 2024
31 December 2023
(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
35,308
1,214
1,081
-577
-
-
37,025
2,458
-27
-
-1
-
-
2,429
1,172
-310
-903
-41
-
-65
48,292
142
3,152
-16,278
-
-
-147
35,308
3,369
-150
161
-922
-
-
2,458
1,090
234
-250
-272
295
74
1,172
The value adjustment through profit or loss is recognised under Net trading income or loss. The transfer of derivatives to th e Observable input category
consists primarily of maturity reductions, implying that the yield curves have become observable.
Danske Bank / Interim report – first quarter 2024 51/66
Notes – Danske Bank Group
G13. Risk management notes
Credit exposure
The consolidated financial statements for 2023 provide a detailed description of the Group’s risk management practices.
Breakdown of credit exposure
(DKK billions)
31 March 2024
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 investment contracts
Insurance assets
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 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 investment contracts
Insurance assets
Assets held for sale
Off-balance-sheet items
Guarantees
Loan commitments shorter than 1 year
Loan commitments longer than 1 year
Other unutilised commitments
Lending
activities
Counterparty
credit risk
Trading and
investment
securities
Customer-
funded
investments
194.9
56.3
-
-
887.3
746.6
-
-
96.2
76.2
198.5
219.9
-
-
97.7
293.5
-
-
223.6
-
-
-
-
-
-
-
-
-
193.6
276.2
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
73.7
514.2
-
-
-
-
16.1
Total
194.9
154.0
487.0
276.2
887.3
970.1
73.7
514.2
96.2
76.2
198.5
219.9
16.2
4,164.4
2,475.8
614.8
469.8
604.1
252.7
114.8
548.2
283.9
918.6
928.2
70.9
496.0
110.4
75.9
197.0
220.3
16.7
252.7
21.8
-
-
918.6
753.3
-
-
110.4
75.9
197.0
220.3
-
-
93.0
351.7
-
-
175.0
-
-
-
-
-
-
-
-
-
196.5
283.9
-
-
-
-
-
-
-
-
0.1
-
-
-
-
-
-
70.9
496.0
-
-
-
-
16.6
Total
4,233.8
2,550.1
619.7
480.5
583.6
* With effect from 1 January 2024, Non-core ceased to exist as a separate segment. Credit exposure as at 31 December 2023 previously reported under Non-core has been reclassified,
and comparatives have been restated to reflect this change.
In addition to credit exposure from lending activities, Danske Bank had made uncommitted loan offers and granted uncommitted
lines of credit of DKK
213 billion at 31 March 2024 (31 December 2023: DKK 232 billion). These items are included in the calculatio n of the total risk exposure amount in
accordance with the Capital Requirements Directive.
Danske Bank / Interim report – first quarter 2024 52/66
Notes – Danske Bank Group
Credit exposure continued
Credit exposure from lending activities
Credit exposure from lending activities in the Group’s banking business includes loans, amounts due from credit institutions and central banks, guaran-
tees 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 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 i s 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 77% (31 December 2023: 75%).
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 2023.
Credit portfolio 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 181 in Annual report 2023.
31 March 2024
(DKK billions)
PD level
Upper Lower
Gross exposure
Expected credit loss
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3
Net exposure
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
131.2
242.1
532.8
599.3
425.8
288.0
88.4
10.5
1.0
0.6
0.2
0.1
0.2
1.0
2.5
5.0
38.0
45.5
29.0
5.3
15.0
0.6
-
-
-
-
-
0.2
0.1
-
-
2.3
31.3
-
-
0.1
0.2
0.4
0.7
1.2
0.8
-
-
-
-
-
-
-
0.1
0.7
1.9
2.7
0.7
1.1
0.1
-
-
-
-
-
-
0.1
-
-
0.6
8.8
131.2
242.1
532.7
599.1
425.4
287.3
87.2
9.7
1.0
0.6
0.2
0.1
0.2
1.0
2.5
5.0
37.2
43.6
26.3
4.6
14.0
0.6
-
-
-
-
-
0.2
-
-
-
1.7
22.5
112.7
128.2
262.5
270.0
135.7
83.9
26.6
1.6
0.2
0.1
-
-
0.1
0.5
1.7
2.5
19.9
15.1
7.3
1.8
3.9
-
-
-
-
-
-
0.1
-
-
-
0.5
2.3
2,319.9
142.2
34.0
3.5
7.3
9.5
2,316.4
134.9
24.5
1,021.5
52.7
2.9
31 December 2023*
(DKK billions)
PD level
Upper Lower
Gross exposure
Expected credit loss
Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3
Net exposure
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
127.8
288.1
537.9
607.8
434.8
290.0
92.3
12.2
1.0
0.6
0.6
0.1
0.3
0.7
1.9
8.1
36.9
47.3
28.1
4.8
14.8
1.5
-
-
-
-
0.1
0.1
0.1
0.4
-
1.3
30.7
-
-
0.1
0.2
0.4
0.7
1.2
0.9
-
-
-
-
-
-
-
-
0.6
1.9
2.8
1.0
1.0
-
-
-
-
-
-
-
-
-
-
0.5
8.6
127.8
288.1
537.8
607.6
434.5
289.3
91.1
11.3
1.0
0.6
0.6
0.1
0.3
0.6
1.9
8.0
36.3
45.3
25.2
3.8
13.8
1.5
-
-
-
-
0.1
0.1
0.1
0.4
-
0.8
22.1
108.9
178.3
263.2
274.9
136.5
87.2
27.9
1.7
0.2
0.2
0.4
-
-
0.4
0.5
5.5
18.7
17.7
6.3
1.0
3.7
0.2
-
-
-
-
-
-
-
0.2
-
0.5
2.2
2,393.3
144.2
32.7
3.6
7.5
9.1
2,389.7
136.7
23.6
1,079.4
54.1
3.0
* With effect from 1 January 2024, Non-core ceased to exist as a separate segment. Credit exposure as at 31 December 2023 previously reported under Non-core has been reclassified,
and comparatives have been restated to reflect this change.
Danske Bank / Interim report – first quarter 2024 53/66
Notes – Danske Bank Group
Credit exposure continued
Credit portfolio 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.
31 March 2024
(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
261.2
140.4
53.4
24.0
85.8
256.9
41.9
71.4
13.7
16.0
4.4
45.0
191.3
42.0
30.6
61.6
36.8
29.0
22.6
14.5
77.6
799.9
0.5
2.1
5.7
3.0
12.5
29.9
7.1
7.6
1.6
1.3
0.3
2.8
4.0
4.6
4.0
10.2
1.6
1.1
1.5
2.3
1.2
37.2
1.2
0.4
2.0
0.2
1.3
5.0
2.2
1.4
0.7
-
0.3
0.1
0.6
0.9
2.2
1.1
1.9
0.3
1.1
1.0
-
10.2
-
0.1
0.3
-
-
0.8
0.4
0.1
-
-
0.1
-
0.1
-
0.1
0.1
-
-
-
-
-
1.3
-
0.1
0.8
0.1
0.3
1.6
0.9
0.4
0.1
-
-
0.1
0.2
0.2
0.4
0.3
-
0.1
0.1
0.1
-
1.5
-
0.1
0.5
0.1
0.5
1.0
1.0
0.4
0.2
-
0.1
-
0.2
0.3
0.8
0.4
0.3
0.1
0.7
0.4
-
2.5
261.2
140.3
53.0
24.0
85.7
256.2
41.5
71.4
13.7
16.0
4.2
45.0
191.2
42.0
30.5
61.4
36.8
29.0
22.6
14.5
77.6
798.6
0.5
2.0
4.9
2.9
12.2
28.3
6.1
7.2
1.5
1.3
0.3
2.7
3.8
4.5
3.6
9.9
1.5
1.1
1.4
2.2
1.2
35.7
1.2
0.3
1.5
0.1
0.8
4.0
1.2
0.9
0.5
-
0.2
-
0.4
0.6
1.4
0.7
1.6
0.2
0.4
0.6
-
7.7
259.6
119.0
14.5
18.3
75.4
35.7
29.2
57.8
4.7
13.1
0.9
41.8
29.7
30.6
20.0
49.3
20.1
12.3
17.5
6.4
58.1
107.5
-
1.2
1.2
1.3
9.7
5.1
2.6
4.7
0.4
0.9
-
2.4
0.7
3.4
2.8
8.1
0.5
0.7
1.3
0.7
1.0
3.8
-
0.2
0.1
-
0.3
0.4
0.5
0.2
0.1
-
-
-
0.1
-
0.4
0.3
0.1
-
-
-
-
-
Total
2,319.9
142.2
34.0
3.5
7.3
9.5 2,316.4
134.9
24.5 1,021.5
52.7
2.9
*As at 31 March 2024, DKK 139 billion of the net exposure in Commercial property is towards residential assets.
As at 31 March 2024, oil and gas exposures (within the Shipping, oil and gas industry) represent a gross exposure of DKK 17.3 billion (31 December
2023: DKK 18.1 billion) and expected credit losses of DKK 0.2 billion (31 December 2023: DKK 0.3 billion). Th ose exposures represent the majority of
the exposures in stage 3 within the Shipping, oil and gas industry at the end of March 2024.
Danske Bank / Interim report – first quarter 2024 54/66
Notes – Danske Bank Group
Credit exposure continued
31 December 2023*
(DKK billions)
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
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
1.0
298.6
3.4
150.0
4.6
54.8
24.9
2.5
82.7 13.3
258.0 32.4
6.5
8.3
1.8
1.2
0.3
2.9
42.8
67.5
12.7
14.6
11.6
44.1
191.1
40.7
27.7
63.4
36.3
29.5
23.7
15.6
84.0
4.5
3.7
5.2
7.6
1.9
1.3
0.8
2.1
1.3
819.0 37.7
0.3
0.4
2.2
0.3
1.2
4.7
2.1
1.3
0.7
-
0.3
-
0.6
0.9
1.9
1.0
2.4
0.3
1.7
0.4
-
10.2
-
0.1
0.3
-
0.1
0.8
0.3
0.1
-
-
0.1
-
0.1
-
0.1
0.2
-
-
-
-
-
1.4
-
0.1
0.7
0.1
0.3
1.8
1.0
0.4
0.1
-
-
-
0.3
0.1
0.3
0.3
0.1
0.1
0.1
0.1
-
1.6
-
0.1
0.6
0.1
0.5
0.9
0.9
0.5
0.2
-
0.1
-
0.2
0.2
0.7
0.4
0.4
0.1
0.7
0.1
-
2.5
1.0
298.6
3.3
149.9
3.9
54.5
24.9
2.4
82.6 13.0
257.3 30.6
5.6
7.8
1.8
1.2
0.3
2.9
42.5
67.4
12.7
14.6
11.5
44.0
191.1
40.7
27.6
63.2
36.3
29.4
23.7
15.6
84.0
4.2
3.6
4.9
7.3
1.9
1.2
0.7
2.0
1.3
817.5 36.1
0.3
0.2
1.7
0.1
0.7
3.8
1.2
0.9
0.5
-
0.2
-
0.5
0.7
1.2
0.6
2.0
0.2
0.9
0.3
-
7.7
295.9
131.7
13.1
19.9
74.3
28.8
30.3
53.5
3.0
12.6
7.9
40.6
22.6
29.4
17.6
51.3
20.4
13.0
18.4
7.2
62.2
125.5
-
2.7
0.9
1.1
10.9
4.7
2.8
5.6
0.5
0.9
0.1
2.5
1.0
2.6
3.8
5.9
0.6
0.7
0.6
0.7
1.2
4.2
-
0.2
-
-
0.3
0.4
0.5
0.2
0.1
-
-
-
0.1
0.3
0.5
0.3
-
-
-
-
-
-
Total
2,393.3 144.2
32.7
3.6
7.5
9.1 2,389.7 136.7
23.6 1,079.4
54.1
3.0
* With effect from 1 January 2024, Non-core ceased to exist as a separate segment. Credit exposure as at 31 December 2023 previously reported under Non-core has been reclassified, and
comparatives under Lending activities have been restated to reflect this change. There is no change to total Credit exposure as at 31 December 2023.
**As at 31 December 2023, DKK 139 billion of the net exposure in Commercial property is towards residential assets.
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 2023, a table showing collateral by type (after haircut) is included. The mitigating effect from collateral at the end of March 2024 can be
found as the difference between the columns ‘Net exposure’ and ‘Net exposure, ex collateral’ and a mounted to DKK 1,398.7 billion at 31 March 2024
(31 December 2023: DKK 1,413.5 billion).
Danske Bank / Interim report – first quarter 2024 55/66
Notes – Danske Bank Group
Credit exposure continued
The table below breaks down credit exposure by business unit and underlying segment.
31 March 2024
Gross exposure
Expected credit loss
Net exposure
Net exposure, ex collateral
(DKK billions)
Stage 1
Stage 2 Stage 3
Stage 1
Stage 2 Stage 3
Stage 1
Stage 2 Stage 3
Stage 1
Stage 2 Stage 3
Personal Customers
Personal Customers
Denmark
Personal Customers
Sweden
Personal Customers
Finland
Personal Customers
Norway
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
Northern Ireland
Group Functions
Total
430.8
18.2
6.0
0.9
0.9
1.3
429.9
17.3
4.7
57.0
1.6
0.1
97.9
2.7
0.5
0.1
0.2
0.1
97.8
2.6
0.4
27.0
0.4
75.8
5.9
2.0
0.1
0.2
0.6
75.7
5.7
1.4
3.9
0.2
115.3
70.5
4.2
3.1
0.5
0.8
0.1
-
-
-
-
-
0.1
0.1
0.1
0.2
115.3
70.5
4.1
2.9
0.4
0.6
18.3
11.8
0.5
0.7
-
-
0.1
-
-
0.1
-
-
-
-
-
-
790.5
34.1
9.8
1.2
1.5
2.3
789.3
32.7
7.4
118.2
3.4
0.1
50.1
304.2
307.0
10.6
36.0
23.6
2.1
10.9
2.4
0.1
1.2
0.4
0.3
3.3
0.8
0.8
4.0
0.4
50.0
303.0
306.6
10.3
32.7
22.8
1.4
6.9
2.0
18.9
99.5
47.0
2.1
12.0
4.6
-
0.8
-
0.3
-
-
-
-
-
0.3
-
-
0.3
-
-
661.7
70.3
15.4
1.7
4.5
5.1
660.0
65.8
10.3
165.7
18.6
0.8
585.8
33.3
6.8
0.4
1.2
1.6
585.5
32.1
5.2
503.9
30.0
2.0
92.7
4.3
2.1
0.2
0.1
0.5
92.5
4.2
1.6
46.9
189.2
0.1
-
-
-
-
189.2
0.1
-
186.7
0.5
0.1
-
-
2,319.9
142.2
34.0
3.5
7.3
9.5
2,316.4
134.9
24.5
1,021.5
52.7
2.9
Danske Bank / Interim report – first quarter 2024 56/66
Notes – Danske Bank Group
Credit exposure continued
31 December 2023*
(DKK billions)
Personal Customers
Personal Customers
Denmark
Personal Customers
Sweden
Personal Customers
Finland
Personal Customers
Norway
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
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
424.0
18.6
6.2
1.0
0.9
1.3
423.0
17.7
4.9
49.4
1.8
101.8
2.9
0.3
0.1
0.2
0.1
101.7
2.7
0.3
32.1
0.4
76.9
5.6
1.9
0.2
0.2
0.6
76.7
5.4
1.3
4.2
0.2
125.9
76.5
4.3
3.1
0.5
0.7
-
-
-
-
-
-
0.1
0.1
0.1
0.2
125.8
76.4
4.2
3.0
0.4
0.5
30.1
16.2
0.7
1.0
-
-
-
-
-
-
-
805.0
34.6
9.6
1.3
1.6
2.4
803.7
33.0
7.3
132.1
4.1
-
-
-
-
-
-
-
52.7
309.6
308.0
9.4
36.8
24.9
1.4
10.4
2.3
0.1
1.1
0.4
0.5
3.0
1.1
0.5
3.7
0.3
52.6
308.5
307.6
8.8
33.8
23.8
0.9
6.7
2.0
19.5
93.3
44.8
1.6
13.8
3.9
-
0.6
0.1
0.4
-
0.1
-
-
-
0.4
-
0.1
0.4
-
-
670.6
71.1
14.2
1.6
4.7
4.5
669.0
66.4
9.7
158.0
19.3
0.6
595.9
33.8
6.9
Northern Ireland
89.4
4.7
1.9
Group Functions**
232.3
0.1
-
0.4
0.3
-
1.1
1.8
595.5
32.7
5.1
511.5
29.8
2.1
0.1
0.4
89.1
4.6
1.5
48.1
0.8
0.2
-
-
232.3
0.1
-
229.7
-
-
Total
2,393.3
144.2
32.7
3.6
7.5
9.1
2,389.7
136.7
23.6
1,079.4
54.1
3.0
* Personal Customers Sweden, Personal Customers Finland and Personal Customers Norway are new sub-segments in Personal Customers in 2024. Comparatives have been reclassified. There
is no change to total credit exposure for Personal Customers as at 31 December 2023.
** With effect from 1 January 2024,Non-core ceased to exist as a separate segment, and became a new sub-segment of Group Functions. Credit exposure as at 31 December 2023 previously
reported under Non-core has been reclassified to Group Functions.
Danske Bank / Interim report – first quarter 2024 57/66
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 inte rest-reduction schedules,
interest-only schedules, temporary payment holidays, term extensions, cancellation of outstanding fees, w aiver 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, o r 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 whethe r to subject the customer’s
assets to a forced sale or whether the assets could be realised later at higher net proceeds. At the en d of the first quarter of 2024, the Group had
recognised properties taken over in Denmark at a carrying amount of DKK 13 million (2023: DKK 17 million), and there were no properties taken over
in other countries (2023: DKK 0 million). The properties are he ld 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 d efinition states that a
probation period of a minimum of two years must pass from the date when forborne exposures are considered to be performing ag ain. Forbearance
measures lead to changes in staging for impairment purposes, and impairments relating to forborne exposures are handled accor ding to the principles
described in note G15 in Annual Report 2023.
Exposures subject to forbearance measures
(DKK millions)
Stage 1
Stage 2
Stage 3
Total
Allowance account
(DKK millions)
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
ECL allowance account as at 31 March 2023
ECL allowance account as at 1 January 2024
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
31 March
2024
31 December
2023
180
6,017
8,059
297
5,279
7,023
14,256
12,598
Stage 1
Stage 2
Stage 3*
Total*
3,273
864
-162
-10
191
-118
-753
-
-20
-2
8,082
-832
232
-122
358
-385
1,113
-
-66
-1
8,290
-32
-70
131
198
-305
-45
-57
-65
10
19,645
-
-
-
747
-807
315
-57
-150
7
3,263
8,380
8,056
19,699
3,592
7,486
9,062
20,140
484
-161
-7
175
-171
-400
-9
-23
1
-452
279
-169
486
-561
300
-
-100
-
-32
-118
176
387
-221
483
-140
-46
-3
-
-
-
1,048
-954
383
-149
-169
-2
ECL allowance account as at 31 March 2024
3,480
7,269
9,549
20,297
* With effect from 1 January 2024, Non-core ceased to exist as a separate segment. Credit exposure in 2023 previously reported under Non-core have been reclassified, and comparatives have
been restated to reflect this change.
Danske Bank / Interim report – first quarter 2024 58/66
Notes – Danske Bank Group
Credit exposure continued
Allowance account broken down by segment
(DKK millions)
Personal
Customers
Business
Customers
Large
Corporate &
Institutions
Northern
Ireland
Group
Functions*
Allowance
account Total
ECL allowance account as at 1 January 2023
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
5,427
159
-220
261
-18
-22
-16
10,235
460
-554
304
-34
-77
21
3,050
117
-15
-206
-
-60
3
ECL allowance account as at 31 March 2023
5,570
10,356
2,889
ECL allowance account as at 1 January 2024
5,306
10,705
3,308
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
144
-252
-115
-49
-27
4
542
-644
854
-72
-134
-6
289
-45
-332
-28
-17
1
863
17
-9
-23
-5
10
-
853
794
68
-11
-21
-
11
-
70
-7
-8
-22
-
-1
-1
31
27
5
-2
-2
-
-1
-
19,645
747
-807
315
-57
-150
7
19,699
20,140
1,048
-954
383
-149
-169
-2
ECL allowance account as at 31 March 2024
5,010
11,245
3,176
840
26
20,297
* With effect from 1 January 2024, Non-core ceased to exist as a separate segment, and became a sub-segment of Group Functions. Comparative information for Group Functions has been
restated to reflect this change.
The method used for calculating expected credit losses is described in detail in note G15 of the Annual Report 2023.
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 co vered by the macroeconomic scenarios, as well as the process related risk, which
could lead to an underestimation of the expected credit losses.
Macroeconomic scenarios
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 quarter of 2024 have been updated with the latest macroeconomic data.
Compared to the end of 2023, the base case and upside scenarios have been revised to reflect expectations of lower inflation, improved house prices
and decreasing interest rates. The scenario weighting is unchanged from 2023. The weight on the base case scenario is 60% (60% in 2023 the upside
scenario is weighted 20% (20% in 2023), and the downside scenario is weighted 20% (20% in 2023) despite the use of a severe s tagflation scenario.
The base case is an extension of the Group’s official view of the Nordic economies (the Nordic Outlook report). At 31 March 2 024, the base case scenario
reflects a soft landing with economic growth moving toward normalised levels. Inflation is expected to come down, leading to declining interest rates over
the coming years. The large house price drops are expected to be over, but elevated interest rates continue to weigh on house prices.
The upside scenario represents a slightly better outlook than the base case scenario across the macroeconomic parameters. In this scenario, the
global inflation returns more sustainably to target which allows the central banks to loosen policies more quick ly. This boosts consumer sentiment,
increasing private consumption and strengthening the housing market.
The downside scenario is a severe recession with high interest rates scenario (reflecting a stagflation scenario) applied in the Group’s ICAAP processes,
which is similar in nature to regulatory stress tests. The severe recession scenario reflects negative growth, increasing interest rates, and falling property
prices for a longer period. The use of the downside scenario was introduced to better capture the elevated risk from high int erest 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 unemployment. 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 fo recast horizon across
the Group’s Nordic markets are included below.
Danske Bank / Interim report – first quarter 2024 59/66
Notes – Danske Bank Group
Credit exposure continued
Denmark
31 March 2024
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Sweden
31 March 2024
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Norway
31 March 2024
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Finland
31 March 2024
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Base-case
2025
2024
2.1
3.0
2.0
3.0
3.0
2.0
3.1
1.9
2.0
2.0
2026
1.7
3.2
1.8
2.3
2.0
Downside
2025
2024
2026
2024
-3.4
6.3
4.0
-19.7
5.4
-2.0
7.5
3.0
-11.0
6.4
-
7.9
2.0
-6.0
3.9
2.4
2.9
1.6
3.0
2.8
Upside
2025
2.4
2.9
1.8
4.0
1.9
2026
1.7
3.0
1.8
4.3
2.0
Base-case
2024
2025
2026
2024
Downside
2025
2026
2024
Upside
2025
2026
1.5
8.3
1.6
1.0
3.2
2.0
8.1
1.0
5.0
2.2
1.8
8.0
1.5
5.0
2.1
-3.5
9.4
4.9
-22.0
5.7
-3.4
10.3
3.9
-13.0
5.7
-1.0
10.7
2.9
-7.0
3.7
1.6
8.3
1.2
1.0
2.9
2.3
8.0
0.7
7.0
2.1
1.9
7.9
1.5
7.0
2.3
Base-case
2025
2024
2026
2024
Downside
2025
2026
2024
Upside
2025
2026
1.1
1.9
3.8
0.8
3.8
2.1
2.3
2.0
4.5
2.8
2.5
2.5
2.2
3.0
2.4
-2.7
5.5
4.5
-19.0
6.3
-1.1
6.4
3.0
-13.0
6.3
0.6
6.5
2.0
-7.0
4.3
1.3
1.9
3.3
0.8
3.4
2.4
2.2
1.9
5.5
1.7
2.7
2.3
2.2
5.0
1.6
Base-case
2024
2025
2026
2024
Downside
2025
2026
2024
Upside
2025
2026
-0.4
7.9
2.0
0.5
3.1
1.9
7.4
1.6
3.0
2.1
1.5
7.0
1.8
2.0
2.1
-2.4
9.9
4.0
-14.2
5.1
-2.0
10.9
3.0
-7.0
5.1
-0.3
10.9
2.0
-5.0
3.1
-0.2
7.9
1.5
0.5
2.7
2.3
7.3
1.4
4.0
1.9
1.6
6.9
1.8
4.0
2.1
Danske Bank / Interim report – first quarter 2024 60/66
Notes – Danske Bank Group
Credit exposure continued
At 31 December 2023, the following base case and downside scenarios were used:
Denmark
31 December 2023
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Sweden
31 December 2023
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Norway
31 December 2023
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Finland
31 December 2023
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Base-case
2025
2024
1.0
3.1
2.0
1.5
3.1
1.6
3.3
1.9
2.0
2.3
2026
1.6
3.4
1.8
2.1
2.0
Downside
2025
2024
2026
2024
-3.4
6.3
4.0
-19.7
5.4
-2.0
7.5
3.0
-11.0
6.4
-
7.9
2.0
-6.0
3.9
2.5
2.7
2.4
3.5
4.3
Upside
2025
1.8
2.6
2.5
3.0
3.5
2026
0.4
3.2
1.4
2.1
2.5
Base-case
2024
2025
2026
2024
1.2
8.2
1.9
-1.0
3.4
1.8
8.0
1.3
4.0
2.3
2.4
7.9
1.6
5.0
2.0
-3.5
9.4
4.9
-22.0
5.7
Downside
2025
-3.4
10.3
3.9
-13.0
5.7
2026
2024
Upside
2025
2026
-1.0
10.7
2.9
-7.0
3.7
2.6
7.9
2.0
1.0
4.6
2.1
7.5
1.6
5.0
3.6
1.3
7.7
1.5
5.0
2.6
Base-case
2024
2025
2026
2024
Downside
2025
2026
2024
Upside
2025
2026
1.1
2.3
3.0
-1.0
3.7
2.1
2.5
2.0
5.0
2.9
1.5
2.5
2.0
4.0
2.5
-2.7
5.5
4.5
-19.0
6.3
-1.1
6.4
3.0
-13.0
6.3
0.6
6.5
2.0
-7.0
4.3
2.5
2.0
3.2
-
5.0
2.4
2.0
2.3
6.0
4.0
0.4
2.3
1.8
4.0
3.0
Base-case
2024
2025
2026
2024
0.3
-0.1
7.8
1.9
0.5
1.9
2.0
7.2
1.5
1.2
1.3
1.5
6.5
2.0
1.3
-2.4
9.9
4.0
-14.2
5.1
Downside
2025
-2.0
10.9
3.0
-7.0
5.1
2026
2024
Upside
2025
2026
-0.3
10.9
2.0
-5.0
3.1
1.3
7.6
2.2
3.0
4.3
2.2
6.9
1.8
4.0
3.5
0.4
6.4
1.7
2.0
2.5
The base case scenario enters with a probability of 60% (31 December 2023: 60%), the upside scenario with a probability of 20 % (31 December 2023:
20%) and the downside scenario with a probability of 20% (31 December 2023: 20%). On the basis of these assess ments, the allowance account as at
31 March 2024 amounted to DKK 20.3 billion (31 December 2023: 20.1 billion). If the base case scenario was assigned a probabi lity of 100%, the
allowance account would decrease DKK 1.9 billion (31 December 2023: 2.0 billio n). Compared to the base case scenario, the allowance account would
increase DKK 9.7 billion (31 December 2023: 10.2 billion), if the downside scenario was assigned a probability of 100%. The i ncrease 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 0.2 billion (31 December 2023: 0.2 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 for ecasts of expected credit losses
(ECL).
Danske Bank / Interim report – first quarter 2024 61/66
Notes – Danske Bank Group
Credit exposure continued
Post-model adjustments
Management applies judgement when determining the need for post-model adjustments. At 31 March 2024, the post-model adjustments amounted to
DKK 6.7 billion (31 December 2023: 6.7 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 agr iculture industry. For
such industries, supplementary calculations are made to ensure sufficient impairment coverage. This also inc ludes post-model adjustments relating
to effects from climate risk or the macroeconomic uncertainty.
non-linear downside risk, for instance on the property market in Copenhagen and other high growth areas for which the macroeconom ic 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
31 March
31 December
2024
2023
1.0
1.8
1.0
1.4
1.4
6.7
0.8
1.9
1.0
1.6
1.4
6.7
* No individual industry included in Others exceeds DKK 0.3 billion at 31 March 2024 (2023: DKK 0.2 billion).
The total balance of post-model adjustments is unchanged compared to the end of 2023. The post-model adjustment related to personal customers is
decreased due to the improved macroeconomic outlook. At the same time, the existing post-model adjustment related to climate risks for agriculture is
increased due to enhanced analysis related to potential CO2 taxation models for agriculture in Denmark.
The Group continues to have significant post-model adjustments related to the current macroeconomic uncertainties characterised by the risk of slowing
growth environment, labour shortages, elevated interest rates and elevated prices giving rise to a new se t 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 industr ies vulner-
able to business cycles, increasing interest rates and refinancing risks, 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 quarter 2024 62/66
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
31 March
2024
31 December
2023
293.5
321.3
436.9
32.9
-
351.7
267.9
461.0
19.4
0.1
1,084.5
1,100.1
*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 320,7 billion (31 December 2023: DKK 267.4 billion), of which DKK 97.1 billion relates to credit institutions and central banks (31 December 2023: DKK 92.4 billion), and other primarily
short-term loans of DKK 0.6 billion (31 December 2023: DKK 0.6 billion), of which DKK 0.6 billion (31 December 2023: DKK 0.6 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
31 March
2024
31 December
2023
807,357
513,894
293,463
209,966
83,496
72,391
11,105
223,543
69,324
595
892,840
541,118
351,722
262,273
89,450
80,713
8,736
240,621
110,275
826
293,463
351,722
(DKK millions)
31 March 2024
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
101,130
1,818
22,889
42,105
2,695
287
2,844
8,251
23,811
22,490
49,468
91,514
Swedish
covered
bonds
21,361
1,331
2,623
2,990
Other
covered
bonds
4,665
230
24,244
812
Corporate
bonds
7,479
-
1,678
150
Total
161,140
26,156
103,745
145,821
Total
167,941
14,076
187,282
28,304
29,951
9,307
436,862
31 December 2023
Held-for-trading (FVPL)
Managed at fair value (FVPL)
Held to collect and sell (FVOCI)
Held to collect (AMC)
117,986
1,845
23,669
47,892
1,179
291
2,905
8,551
29,084
17,069
49,470
92,699
20,862
1,307
4,776
5,093
3,272
286
25,077
1,013
5,179
-
1,330
150
177,563
20,798
107,226
155,398
Total
191,392
12,926
188,321
32,038
29,648
6,659
460,984
At 31 March 2024, the Group had an additional bond portfolio, including bond -based unit trust certificates, worth DKK 209,209 million (31 December
2023: DKK 214,073 million) recognised as assets under insurance contracts and thus not included in the table ab ove. The section on insurance risk in
Annual Report 2023 provides more information. For bonds classified as hold -to-collect, amortised cost exceeded fair value as at 31 March 2024 and
31 December 2023, see note G12 for more information.
Danske Bank / Interim report – first quarter 2024 63/66
Notes – Danske Bank Group
Bond portfolio continued
Bond portfolio broken down by geographical area
(DKK millions)
31 March 2024
Denmark
Sweden
UK
Norway
USA
Spain
France
Luxembourg
Finland
Ireland
Italy
Portugal
Austria
Netherlands
Germany
Belgium
Other
Total
31 December 2023
Denmark
Sweden
UK
Norway
USA
Spain
France
Luxembourg
Finland
Ireland
Italy
Portugal
Austria
Netherlands
Germany
Belgium
Other
Total
Central and
local govern-
ment bonds
Quasi-
government
bonds
Danish
mortgage
bonds
Swedish
covered
bonds
28,961
36,238
10,854
3,631
14,509
1,116
11,683
-
9,065
994
3,658
3
4,477
1,201
40,866
685
-
-
-
295
-
3,251
-
19
4,916
3,896
-
-
-
-
2
-
716
982
187,282
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
167,941
14,076
187,282
28,754
61,267
11,141
6,049
15,529
1,243
4,703
-
10,224
550
1,413
3
4,513
3,349
42,152
503
-
-
-
291
-
3,274
-
19
5,205
2,954
-
-
-
-
1
-
442
740
188,321
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
28,304
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
28,304
-
32,038
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Other
covered
bonds
-
1
3,713
24,120
-
1
332
-
1,086
-
-
-
-
46
216
1
434
29,951
-
-
3,518
23,902
-
1
237
-
1,089
-
-
-
66
17
216
1
602
Corporate
bonds
1,126
2,767
1,104
2,156
7
-
85
159
961
133
6
-
129
404
93
-
177
Total
217,369
67,311
15,966
29,907
17,767
1,117
12,119
5,075
15,008
1,127
3,664
3
4,607
1,653
41,175
1,401
1,593
9,307
436,862
870
1,362
1,009
1,358
7
-
116
123
909
94
5
-
113
510
96
-
87
217,945
94,667
15,959
31,309
18,810
1,244
5,075
5,328
15,176
643
1,418
3
4,691
3,877
42,465
946
1,429
191,392
12,926
188,321
32,038
29,648
6,659
460,984
Danske Bank / Interim report – first quarter 2024 64/66
Notes – Danske Bank Group
Bond portfolio continued
Bond portfolio broken down by external ratings
(DKK millions)
31 March 2024
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
106,962
25,875
11,636
18,681
-
934
3
181
2,361
1,297
-
-
-
10
13,354
640
61
20
-
-
-
-
-
-
-
-
-
-
187,122
-
-
-
-
160
-
-
-
-
-
-
-
-
28,283
-
22
-
-
-
-
-
-
-
-
-
-
-
Other
covered
bonds
29,143
19
787
-
-
2
-
-
-
-
-
-
-
-
Total
167,941
14,076
187,282
28,304
29,951
31 December 2023
AAA
AA+
AA
AA-
A+
A
A-
BBB+
BBB
BBB-
BB+
BB
BB-
Sub. "investment-grade" or unrated
137,601
27,061
8,556
15,515
-
1,132
3
111
377
1,036
-
-
-
-
12,461
442
-
23
-
-
-
-
-
-
-
-
-
-
187,903
-
-
-
-
418
-
-
-
-
-
-
-
-
32,017
-
21
-
-
-
-
-
-
-
-
-
-
-
28,925
28
692
-
-
4
-
-
-
-
-
-
-
-
Total
191,392
12,926
188,321
32,038
29,648
Corporate
bonds
2,202
2
1,431
230
260
1,671
314
610
1,365
546
142
369
35
131
9,307
1,623
2
965
117
266
984
196
505
987
596
97
187
36
97
6,659
Total
367,065
26,537
13,937
18,931
260
2,767
317
792
3,726
1,843
142
369
35
141
436,862
400,530
27,533
10,234
15,654
266
2,538
199
617
1,364
1,632
97
187
36
97
460,984
Danske Bank / Interim report – first quarter 2024 65/66
Statement by the management
The Board of Directors and the Executive Leadership Team (the management) have today reviewed and adopted the Interim report
– first quarter 2024 of the Danske Bank Group.
The consolidated interim financial statements have been presented in accordance with IAS 34, Interim Financial Reporting, as
adopted by the EU. Furthermore, the interim report has been prepared in accordance with legal requirements, including the disclo-
sure requirements for interim reports of listed financial institutions in Denmark.
In our opinion, the consolidated interim financial statements give a true and fair view of the Group’s assets, liabilities, shareholders’
equity and financial position at 31 March 2024 and of the results of the Group’s operations and the consolidated cash flows for the
period starting on 1 January 2024 and ending on 31 March 2024.
Moreover, in our opinion, the management’s report includes a fair view of developments in the Group’s operations and financial
position and describes the significant risks and uncertainty factors that may affect the Group .
Copenhagen, 3 May 2024
Executive Leadership Team
Carsten Egeriis
CEO
Magnus Agustsson
Joachim Alpen
Christian Bornfeld
Karsten Breum
Stephan Engels
Johanna Norberg
Dorthe Tolborg
Frans Woelders
Board of Directors
Martin Blessing
Chairman
Martin Nørkjær Larsen
Vice Chairman
Lars-Erik Brenøe
Jacob Dahl
Raija-Leena Hankonen-Nybom
Lieve Mostrey
Allan Polack
Helle Valentin
Bente Bang
Elected by the employees
Kirsten Ebbe Brich
Elected by the employees
Aleksandras Cicasovas
Elected by the employees
Louise Aggerstrøm Hansen
Elected by the employees
Danske Bank / Interim report – first quarter 2024 66/66
Supplementary information
Financial calendar
19 July 2024
31 October 2024
Contacts
Interim report – first half 2024
Interim report – first nine months 2024
Claus Ingar Jensen
Head of Investor Relations
clauj@danskebank.dk
Links
Danske Bank
Denmark
Finland
Sweden
Norway
Northern Ireland
Realkredit Danmark
Danske Capital
Danica Pension
danskebank.com
danskebank.dk
danskebank.fi
danskebank.se
danskebank.no
danskebank.co.uk
rd.dk
danskecapital.com
danicapension.dk
Danske Bank’s financial statements are available online at danskebank.com/reports.