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Danske Bank Group
Interim report -
first nine months
2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Contents
Management’s report
Financial statements
Statements
Income statement
Statement of comprehensive income
Balance sheet
Statement of capital
Cash flow statement
Notes
27
27
28
29
31
32
Statement by the management
Supplementary information
64
65
Financial highlights - Danske Bank Group
Executive summary
Financial review
Business units
Personal Customers
Business Customers
Large Corporates & Institutions
Danica Pension
Northern Ireland
Group Functions
Definition of alternative performance measures
3
4
5
11
12
14
16
19
21
23
25
2
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
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
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)
Q1-Q3
Q1-Q3
Index
2024
2023*
24/23
106
110
99
153
171
108
101
92
115
-
119
142
114
27,452
25,852
10,403
2,110
1,407
464
9,422
2,127
922
272
41,836
38,595
19,046
18,853
682
741
22,790
19,741
-436
294
23,227
19,447
5,593
3,950
17,634
15,497
7.5
20.7
13.4
1.3
45.5
23.0
19.1
7.0
18.0
12.5
1.2
48.8
23.2
18.8
Q3
2024
9,165
3,329
733
459
140
9,145
3,698
608
457
147
13,826
14,055
6,228
6,481
228
209
7,598
7,574
-337
7,935
1,770
6,165
-200
7,774
1,936
5,839
-
7.2
13.9
1.3
45.0
23.0
19.1
7.5
6.8
13.3
1.3
46.1
22.5
18.5
201.5
210.4
164.4
196.4
201.5
210.4
207.5
209.8
100
90
121
100
95
98
96
109
100
169
102
91
106
9,317
3,153
-111
233
417
13,009
6,211
245
6,797
322
6,475
1,156
5,319
-
6.2
12.6
1.3
47.7
23.2
18.8
164.4
196.4
Full-time-equivalent staff (end of period)
20,057
20,097
100
20,057
20,079
100
20,097
100
20,021
* Comparative information has been restated as described in note G2(b).
** Dividend for the first half of 2024 is an interim dividend of DKK 7.5 per share. The dividend was paid out in July 2024. 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.
3
Danske Bank / Interim report – first nine months 2024
Q2
Index
Q3
Index
Full year
2024
Q3/Q2
2023*
24/23
2023*
(DKK millions)
Q1-Q3
2024
Q1-Q3
Index
2023*
24/23
Q3
2024
Q2
Index
Q3
Index
Full year
2024 Q3/Q2
2023*
24/23
2023*
Balance sheet (end of period)
98
34,972
Due from credit institutions and central banks
217,423
295,739
106
12,904
Repo loans
-
2,613
Loans
197
34
106
100
93
1,472
Trading portfolio assets
460
Investment securities
52,422
Insurance assets
25,478
Other assets
989
Total assets
336,530
285,269
74
118
217,423
254,350
336,530
340,108
85
99
295,739
285,269
74
118
271,434
272,841
1,671,217
1,627,119
103
1,671,217
1,652,294
101
1,627,119
103
1,670,142
514,297
602,915
266,255
279,830
85
95
514,297
497,400
266,255
273,642
526,507
506,426
104
526,507
522,846
211,213
231,900
3,743,442
3,829,199
91
98
211,213
223,118
3,743,442
3,763,759
103
97
101
95
99
602,915
279,830
85
95
548,189
283,914
506,426
104
496,031
231,900
3,829,199
91
98
228,429
3,770,981
112
26,944
Due to credit institutions and central banks
87,198
68,821
127
87,198
76,876
113
68,821
127
70,774
262
Repo deposits
26,682
Deposits
200,997
212,442
1,064,407
1,093,850
5,420
Bonds issued by Realkredit Danmark
749,028
716,009
200,997
233,519
1,064,407
1,072,032
86
99
212,442
1,093,850
749,028
730,638
103
716,009
-
123
153
116
95
97
105
108
70
105
104
95
105
345,785
321,039
368,184
529,337
513,257
487,225
200,611
192,783
37,059
39,053
176,916
168,642
345,785
356,660
368,184
372,509
513,257
506,832
200,611
199,586
37,059
37,052
176,916
178,055
321,039
529,337
487,225
192,783
39,053
168,642
97
99
101
101
100
99
99
95
97
105
108
70
105
104
95
105
197,140
1,108,898
741,062
315,145
454,487
482,630
186,332
38,774
175,739
Total liabilities and equity
3,743,442
3,829,199
98
3,743,442
3,763,759
* Comparative information has been restated as described in note G2(b).
3,829,199
98
3,770,981
21,262
Other issued bonds
Trading portfolio liabilities
Insurance liabilities
Other liabilities
Subordinated debt
Shareholders' equity
14.5
24.8
12.7
1.2
48.6
23.1
18.8
180.4
204.4
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Executive summary
During the first nine months of 2024, Danske Bank consistently
delivered satisfactory financial results, while we also progressed on
our strategic priorities. In the third quarter, we saw a continuation of
the positive financial performance we witnessed through the first
half of the year. This was enabled by better profitability and progress
in customer volumes, especially on the corporate side, and
continually strong credit quality. Although geopolitical tension has
unfortunately become more permanent and continues to be the
global backdrop, the macroeconomic picture in the Nordic countries
has improved, and we maintain our strong focus on our customers
and are delivering according to the plan set out in our Forward ’28
strategy. We continue to see improved commercial momentum and
good interest in our leading advisory solutions for customers with
complex needs, and we continue to enhance our products to make
everyday banking both simpler and safer. This includes
implementing technology such as GenAI and cloud-based solutions
to reduce the use of legacy platforms. Our focus on execution and
our efforts to improve Danske Bank to the benefit of all stakeholders
is moving us forward as expected – which is positive for both our
customers and society.
In the third quarter, the macroeconomic outlook improved, as
inflation got under control and interest rates were lowered, which all
in all is paving the way for an outlook of stable growth. Among the
Nordic countries, the macroeconomic outlook is especially positive in
Denmark where the labour market remains strong, inflation is low
and economic growth is expected to be solid, even without the
significant contribution from the pharmaceutical sector. Despite the
more positive macroeconomic outlook, we remain prudently aware
of the downside risks stemming from the geopolitical situation and
concerns about a potential slowdown in economic activity.
On the back of lower inflation, several central banks in the Nordic
region lowered their policy rates in the third quarter. Following lower
policy rates from the central banks in Sweden and Denmark, we also
lowered selected customer rates on lending and deposits while
ensuring that our offering remains attractive across customer
segments.
4
Danske Bank / Interim report – first nine months 2024
In sum, also in the third quarter, we achieved a satisfactory and
stable performance, resulting in a return on shareholders’ equity of
13.9% for the third quarter and 13.4% for the first nine months of
2024.
Importantly, alongside our satisfactory financial results and better
profitability, we continued to make progress on enhancing our
foundation for delivering on our Forward ’28 strategy, and we
continue to invest to improve the bank for all stakeholders.
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 buffers well above
regulatory requirements. In terms of long-term wholesale funding, as
per early October, we had issued more than DKK 70 billion so far in
2024. Our issuance has been well received by the market, enabling
us to obtain improved spreads on the back of rating upgrades by
Moody’s and S&P. This also means that we are progressing well
towards meeting our full-year funding plan.
At the end of September 2024, our liquidity coverage ratio stood at
175% (31 December 2023: 170%), with an LCR reserve of DKK 564
billion (31 December 2023: DKK 615 billion), and our net stable
funding ratio stood at 121%.
Capital released from personal customer exit in
Norway
During the fourth quarter of 2024, once the sale to Nordea has
closed, we intend to distribute the capital released from exiting our
personal customer business in Norway as an extraordinary dividend
payment. The capital released is expected to amount to
approximately DKK 5.5 billion.
Distribution of remaining net profit for 2024
It remains the intention of the Board of Directors to distribute the full
remaining net profit for the full year of 2024 in 2025. This is subject
to a continually strong financial performance, relevant approvals,
including from the Danish Financial Supervisory Authority, and our
capital ratios remaining above applicable capital requirements.
Share buy-back programme
At the end of September 2024, Danske Bank had bought back around
18.7 million shares for a total purchase amount of DKK 3.8 billion
(figures at trade date) of the planned DKK 5.5 billion share buy-back
programme.
Financials
Danske Bank delivered a net profit of DKK 17,634 million in the first
nine months of 2024, up 14% from the same period last year. Good
customer activity combined with low loan impairments supported
the financial result for the period.
Net fee income increased 10% from the level in the first nine months
of 2023, due mainly to higher investment fees as a result of the
improved performance of our funds and a pick-up in activity as a
result of the more favourable financial markets. Net sales from
assets under management saw a positive development through the
first nine months of the year due to a high level of assets under
management. Net trading income was stable, which should be
viewed in the context of the level in the first half of 2023 having been
exceptionally high, but also due to relatively low secondary customer
activity and changes in market dynamics in the first nine months of
2024.
Net income from insurance business increased 53% from the level in
the first nine months of 2023. The increase was due mainly to an
increase in the net financial result. Furthermore, income included a
reversal of provisions of DKK 50 million related to the sale of Danica
Norway in 2022.
Operating expenses are on track to match our full-year guidance. The
year-on-year increase was caused mainly by higher digitisation
investments made under our Forward ’28 strategy and higher bonus
payments and staff costs that were impacted by wage inflation.
Loan impairments reflected overall solid credit quality and were low
in the first nine months of 2024, amounting to a net reversal of
DKK 436 million. We continue to apply significant post-model
adjustments related to the macroeconomic uncertainty and remain
watchful of any possible credit deterioration.
Outlook for 2024
We have changed our net profit outlook for the full year, so we now
expect net profit in the range of DKK 22.5-23.5 billion. This is the
second revision of our outlook this year as we at the end of June
revised the outlook for 2024 upwards to a net profit in the range of
DKK 21-23 billion from previously DKK 20-22 billion.
We now expect operating expenses for the full year to be around
DKK 25.8 billion, reflecting lower than expected non-recurring items,
effect from insurance reimbursement and continued focus on cost
management. The outlook now includes non-recurring items of
approximately DKK 0.3 billion related to the relocation to the new
domicile and minor costs for the divestment of our personal
customer business in Norway. Previously we expected operating
expenses between DKK 26 and DKK 26.5 billion including non-
recurring items of approximately DKK 0.6 billion.
In addition, the upgrade follows our continually strong credit quality
and net reversals of loan impairment charges in the first nine months
of the year. As such, we now expect full-year loan impairment
charges to be around zero from previously up to DKK 0.6 billion.
The outlook for income remains unchanged.
Today’s change will not have any impact on our financial targets for
2026.
Changes in the Executive Leadership Team
After dedicating almost five years to Danske Bank and a total of 36
years to an active business career, Stephan Engels, Chief Financial
Officer and a member of the Executive Leadership Team in Danske
Bank, has decided to retire from executive leadership roles. Danske
Bank has appointed Cecile Hillary as new Chief Financial Officer.
Cecile Hillary will become part of Danske Bank’s Executive
Leadership Team and will join Danske Bank no later than 1 March
2025.
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Financial review
Q1-Q3 2024 vs Q1-Q3 2023
Net profit increased to DKK 17,634 million (Q1-Q3 2023: DKK 15,497
million) as a result of increases in net interest income, net fee income
and net income from insurance business. Good customer activity and
low loan impairments also supported the financial result for the first
nine months of 2024.
Income
Net interest income increased to DKK 27,452 million (Q1-Q3 2023:
DKK 25,852 million). The increase was driven by higher income from
deposits following repricing actions as well as product development
initiatives. Lending margins were under pressure from the rise in
market rates relative to the same period last year, but market rates
were lowered in the third quarter of 2024.
Net fee income increased to DKK 10,403 million (Q1-Q3 2023:
DKK 9,422 million). Everyday banking fees increased due to higher
customer activity and repricing actions. Furthermore, investment
fees increased on the back of an improved performance of our funds
and a pick-up in activity resulting from the more favourable
conditions on the financial markets. Net sales from assets under
management saw a positive development through the first nine
months of the year due to a high level of assets under management.
In addition, we saw a non-recurring effect related to a new vendor
agreement, which had a retroactive effect.
Net profit
DKK 6,165 million
for the third quarter of 2024
5
Danske Bank / Interim report – first nine months 2024
Net trading income was stable at DKK 2,110 million (Q1-Q3 2023:
DKK 2,127 million). Driven by healthy customer activity levels, net
trading income remained at a high level, although relatively low
secondary customer activity affected net trading income in the first
nine months of 2024. The result for the first nine months of 2023
was affected by large one-offs.
Operating expenses
Operating expenses amounted to DKK 19,046 million (Q1-Q3 2023:
DKK 18,853 million). As expected, the development was impacted by
higher digitisation investments made under our Forward ’28
strategy, higher bonus payments and staff costs impacted by wage
inflation.
Net income from insurance business increased to DKK 1,407 million
(Q1-Q3 2023: DKK 922 million). The increase was due to a higher net
financial result following the positive developments in the financial
markets, which lifted both the investment results on insurance
products where Danica Pension has the investment risk and the
investment result attributable to shareholders’ equity. Danica
Pension continued to see a rise in new health and accident claims,
which reflects the general trend in society and also resulted in an
increase in provisions for insurance contracts.
Other income amounted to DKK 464 million (Q1-Q3 2023: DKK 272
million). Sales of assets in our leasing company and the sale of the
Norwegian company Tyssekraft A/S contributed to the result, while
holdings in associates had a negative effect on the result. The year-
earlier period was affected by a provision related to prudent
valuation and expected transaction costs of DKK 693 million that was
made in connection with the agreement to sell our personal
customer business in Norway.
Finally, the Resolution fund, Swedish bank tax etc. item stood at DKK
682 million (Q1-Q3 2023: DKK 741 million).
Loan impairment charges
Loan impairments were low in the first nine months of 2024,
amounting to a net reversal of DKK 436 million (Q1-Q3 2023: a net
charge of DKK 294 million).
The impairment level reflected overall solid credit quality and the fact
that macroeconomic growth is expected to gradually return to
normal levels, although the macroeconomic landscape remains
uncertain. We continue to apply significant post-model adjustments
related to the macroeconomic uncertainty and remain watchful of
any possible credit deterioration.
Personal Customers saw impairment reversals, contrary to 2023,
when there was a net charge. Reversals for the first nine months of
2024 were driven by a combination of updated macroeconomic
scenarios and a reduction in post-model adjustments due to the
Loan impairment charges
(DKK millions)
Personal Customers
Business Customers
Large Corporates & Institutions
Northern Ireland
Group Functions
Total
Q1-Q3 2024
% of net credit
exposure*
Q1-Q3 2023
% of net credit
exposure*
Charges
-0.04
0.05
-0.15
-0.14
-0.28
-0.03
333
246
-163
-119
-4
294
0.05
0.05
-0.06
-0.29
-0.15
0.02
Charges
-232
265
-403
-62
-5
-436
* Defined as net credit exposure from lending activities, excluding exposure related to credit institutions and
central banks and loan commitments.
Q3 2024 vs Q2 2024
Net profit increased to DKK 6,165 million (Q2 2024: DKK 5,839
million). An increase in net trading income and stable net interest
income more than offset a decrease in net fee income.
• Net interest income amounted to DKK 9,165 million (Q2 2024:
DKK 9,145 million), a relatively flat development from the
preceding quarter.
• Net fee income decreased to DKK 3,329 million (Q2 2024:
DKK 3,698 million), driven by lower capital markets fees and
financing fees impacted by slow-down in summer period. In
addition, we saw a non-recurring decline in fee expenses due to
a new vendor agreement of DKK 102 million being booked in
the preceding quarter.
• Net trading income increased to DKK 733 million (Q2 2024:
DKK 608 million), driven by higher customer activity and more
favourable market conditions on the back of central bank
actions.
• Net income from insurance business was flat at DKK 459
million (Q2 2024: DKK 457 million) on the basis of an increase in
the net financial result, while the insurance service result
decreased.
• Operating expenses decreased to DKK 6,228 million (Q2 2024:
DKK 6,481 million), due mainly to our strict cost management
and an insurance reimbursement registered in the third
quarter of DKK 179 million.
• Loan impairments amounted to a net reversal of DKK 337
million (Q2 2024: a net reversal of DKK 200 million). In both
quarters, reversals were driven by solid credit quality,
successful restructuring activities and reduced post-model
adjustments.
• Tax amounted to DKK 1,770 million (Q2 2024: DKK 1,936
million), corresponding to an effective tax rate of 22.3% (Q2
2024: 24.9%).
Financial highlights
Executive summary
Financial review
Business units
Financial statements
improved macroeconomic outlook. Underlying credit quality
remained stable.
Business Customers had impairment charges comparable to those in
2023, and underlying credit quality remained solid.
Large Corporates & Institutions continued to see a net reversal owing
to successful restructuring 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 5,593 million (Q1-Q3 2023: DKK 3,950
million) corresponded to an effective tax rate of 24.1% (Q1-Q3 2023:
20.3%).
Lending
Lending stood at DKK 1,671 billion (end-2023: DKK 1,670 billion).
Mortgage lending at nominal value at Realkredit Danmark amounted
to DKK 799 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 personal customer
business in Norway. The sale, which includes, among other things,
loans and deposits, is expected to close during the fourth quarter of
2024.
At Large Corporates & Institutions, we have seen a decrease in
lending volumes of 4% since the end of 2023, reflecting the volatile
operating environment. Lending volumes in General Banking have
increased 4% since the end of 2023, however, primarily driven by
corporate customer lending in Sweden.
Lending at Business Customers was up 2% from the level at the end
of 2023. In local currency, bank lending volumes increased across
6
Danske Bank / Interim report – first nine months 2024
our Nordic markets, except for Denmark. The depreciation of the
currencies in Norway and Sweden reduced bank lending volumes by
DKK 4.9 billion, leading to an overall increase of 3% relative to the
level at the end of 2023. Mortgage volumes increased 1% relative to
the level at the end of 2023.
At Personal Customers, we saw a flat development in total bank
lending volumes, although there was a 2% increase in volumes in
Denmark that was driven by home finance products, such as Danske
Bolig Fri. Total lending across markets was on par with the level at the
end of 2023. The depreciation of the Swedish krona had a negative
effect of DKK 1.5 billion.
In Denmark, new gross lending, excluding repo loans, amounted to
DKK 90.4 billion. Lending to personal customers accounted for
DKK 19.8 billion of this amount.
Deposits
Deposits amounted to DKK 1,064 billion at the end of September
2024 (end-2023: DKK 1,109 billion). Deposit volumes in Norway and
Sweden decreased, due mainly to the depreciation of the currencies.
Fuelled by our savings products, deposit volumes for Personal
Customers increased 3% from the level at the end of 2023. The
increase was driven by our Private Banking unit, which saw an
increase of 12%, and Personal Customers Denmark and Finland,
which saw increases of 2%. The depreciation of the Swedish krona
had a small negative effect.
At Business Banking, deposit volumes decreased 5% relative to the
level at the end of 2023. We saw a stable development in Finland,
driven by an inflow of public-sector customers. In Norway, we
continued to deliberately bring down public-sector deposits. Both the
Swedish krona and the Norwegian krone depreciated further, with a
total effect since the end of 2023 of DKK 2.7 billion.
At Large Corporates & Institutions, deposit volumes decreased 14%
from the level at the end of 2023 as we saw an increase in corporate
customers choosing to reinvest their cash holdings. We welcomed
more new large corporate customers in the first nine months of
2024, continuing to execute on our strategic ambition to grow our
corporate customer portfolio outside Denmark.
Credit exposure
Credit exposure from lending activities decreased to DKK 2,515
billion (end-2023: DKK 2,550 billion). The decrease in exposure was
caused by lower deposits with central banks as well as a decrease in
the Personal Customers Norway exposure due to the decision to exit
the personal customer market in Norway as part of the Forward ’28
strategy. The decrease was partially countered by an increase in
exposure to the Transportation segment.
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 nine months of 2024 at 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 in core segments
(DKK millions)
Gross exposure
Allowance account
Net exposure
Collateral (after haircut)*
Stage 3 coverage ratio (%)*
Stage 3 gross/total gross credit exposure
30 September
2024
31 December
2023
31,706
9,068
22,639
19,303
73
1.3%
32,686
9,062
23,624
20,642
75
1.3%
* The stage 3 coverage ratio is calculated as allowance account stage 3 exposures relative to gross stage 3 net of collateral
(after haircuts).
Allowance account by business units
Allowance account by business units
(DKK millions)
Personal Customers
Business Customers
Large Corporates & Institutions
Northern Ireland
Group Functions
Total
* Relating to lending activities.
30 September 2024
31 December 2023
Accum.
impairm.
charges
5,008
10,948
3,447
801
20
20,225
% of credit
exposure*
0.67
1.60
0.94
1.23
-0.78
1.08
Accum.
impairm.
charges
5,306
10,705
3,308
794
27
20,140
% of credit
exposure*
0.68
1.58
0.92
1.34
1.21
1.07
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Total gross credit exposure in stage 3 was stable at DKK 31.7 billion
(end-2023: DKK 32.7 billion), corresponding to 1.3% of total gross
exposure. Stage 3 exposure was concentrated on personal
customers, commercial property, retailing and agriculture, which
combined accounted for 58% of total gross exposure in stage 3.
The allowance account amounted to 1.08% (end-2023: 1.07%) of
credit exposure.
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, which are included in the
calculation of the Group’s liquidity cover ratio (LCR). To ensure
aligned accounting treatment across the banking book, these bonds
are held at amortised cost. The carrying amount and fair value of the
Group’s hold-to-collect bond instruments can be seen in note G13.
Funding and liquidity
During the third quarter of 2024, the funding markets remained
strong despite the summer holidays and the upcoming US election.
The well-known and very tense geopolitical situation persisted.
At the end of September 2024, the Group had issued covered bonds
of DKK 23.8 billion, preferred senior debt of DKK 6.9 billion, non-
preferred senior debt of DKK 21.6 billion and tier 2 capital of DKK 8.4
billion, thus bringing total long-term wholesale funding to DKK 60.7
billion.
In terms of long-term wholesale funding, as per early October 2024,
we had issued more than DKK 70 billion. All issues have been well
received by the market, enabling us to obtain improved spreads on
the back of rating upgrades by Moody’s and S&P. This also means
that we are progressing well towards meeting our full-year funding
plan.
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.
The reassessment was made following the Danish FSA’s orders
issued on 12 February 2024.
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 format will
depend on balance sheet growth and redemptions on the one hand
and our capital targets on the other. Any issuing of subordinated debt
may cover part of our funding need. Note G7 provides more
information about bond issues in the first nine months of 2024.
Danske Bank’s liquidity position remained robust. At the end of
September 2024, our liquidity coverage ratio stood at 175% (31
December 2023: 170%), with a LCR reserve of DKK 564 billion (31
December 2023: DKK 615 billion), and our net stable funding ratio
stood at 121%.
At 30 September 2024, the total nominal value of outstanding long-
term funding, excluding debt issued by Realkredit Danmark, was
DKK 335 billion (31 December 2023: DKK 337 billion).
Capital ratios and requirements
At the end of September 2024, the Group’s total capital ratio was
23.0%, and its CET1 capital ratio was 19.1%, against 23.1% and
18.8%, respectively, at the end of 2023. The movement in the capital
ratios in the first nine months of 2024 was driven primarily by a
decrease in the capital deduction for Danica Pension.
During the first nine months of 2024, the total REA increased
approximately DKK 8 billion, due mainly to the frontloading effect of
initial implementation of CRR3 of DKK 20 billion. The rise was partly
countered by a decrease in the REA for market risk.
Danske Bank’s capital management policies are based on the
Internal Capital Adequacy Assessment Process (ICAAP). In this
process, Danske Bank determines its solvency need ratio. The
solvency need ratio consists of the 8% minimum capital requirement
under Pillar I and an individual capital add-on under Pillar II.
At the end of September 2024, the Group’s solvency need ratio was
11.0%, an increase of 0.3 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 2.0 billion.
A combined buffer requirement (CBR) applies to financial institutions
in addition to the solvency need ratio. At the end of September 2024,
the Group’s CBR was 8.2%, an increase of 0.2 percentage points from
the level at the end of 2023 due to the Danish government’s decision
to activate the 7% systemic risk buffer with effect from 30 June
2024.
Capital ratios and requirements
(% of the total REA)
Capital ratios
CET 1 capital ratio
Total capital ratio
Capital requirements (incl. buffers)
CET 1 requirement
- portion from countercyclical buffer
- portion from capital conservation
buffer
- portion from systemic risk buffer
- portion from SIFI buffer
Solvency need ratio
Total capital requirement**
Buffer to requirement
CET 1 capital
Total capital
30 September
2024
Fully phased-in*
19.1
23.0
14.6
2.1
2.5
0.7
3.0
11.0
19.3
4.5
3.8
19.0
22.9
14.6
2.0
2.5
0.7
3.0
11.0
19.3
4.5
3.7
* 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 September
2024.
7
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
MREL requirement and eligible funds
(first nine months 2024)
DKK billion (% of total REA)
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 decision 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 September 2024, the point-in-time requirement
including the CBR was equivalent to DKK 254 billion, or 36.5% of the
total REA adjusted for Realkredit Danmark. Taking the deduction of
capital and debt buffer requirements for Realkredit Danmark into
account, MREL-eligible liabilities amounted to DKK 284 billion. In
addition, an MREL of 6% of the leverage ratio exposure (LRE) is in
place. The LRE-based requirement equalled 22.5% 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.
254
(36.5%)
At the end of September 2024, the subordination requirement was
equivalent to DKK 211 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 246 billion.
284
(40.7%)
37
(5.3%)
86
(12.4.%)
160
(23.0%)
MREL including CBR
MREL funds
Non-preferred senior debt > 1 year
Preferred senior debt > 1 year
CET1, AT1, T2
MREL including CBR
Note: The requirement and eligible funds are adjusted for Realkredit
Danmark’s capital and debt buffer requirements.
8
Danske Bank / Interim report – first nine months 2024
Leverage ratio
At the end of September 2024, the Group’s leverage ratio was 5.1%
under the transitional rules and 5.0% under the fully phased-in rules.
Capital targets and capital distribution
The CET1 capital ratio target was kept at above 16% and ensures a
sufficiently prudent buffer in relation to the capital requirement.
Danske Bank fully meets this capital target.
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 September 2024, Danske Bank was in compliance with
all threshold values. A separate report is available at
danskebank.com/ir.
The Board of Directors will continue to adapt the capital targets to
regulatory developments in order to ensure a strong capital position.
Realkredit Danmark also complies with all threshold values.
New regulation
As part of the EU Banking Package 2021 and in order to implement
Basel IV, the European Commission adopted proposals in October
2021. On 27 June 2023, the EU co-legislators reached a provisional
political agreement on the proposals for implementing Basel IV. The
new rules were adopted by the EU in June 2024 and published in the
EU Official Journal. Implementing the Basel IV standard within the EU,
CRR3 will apply from 1 January 2025 and onwards. The date on
which the Fundamental Review of the Trading Book (FRTB) rules take
effect has, however, been postponed and is now 1 January 2026.
On the basis of the Group’s current and updated analysis of CRR3, the
Group’s current capital planning takes into account the expected REA
impact of the initial implementation in 2025. The Group decided to
frontload part of the expected impact of CRR3 in the second quarter
of 2024.
The fully phased-in rules are subject to a lengthy transition period
and transitional arrangements. Taking into account the transitional
arrangements with regard to the output floor, the Group currently
expects the output floor to restrict the Group at the earliest in 2033,
when the transitional arrangements are set to lapse.
On the basis of our strong financial performance in the first half year
of 2024 and our strong capital position at the end of June 2024, the
Board of Directors approved an interim dividend of DKK 7.5 per share,
corresponding to 56% of net profit for the first half of 2024. The
dividend was paid out in July 2024.
Capital released from personal customer exit in
Norway
During the fourth quarter of 2024, once the sale to Nordea has
closed, we intend to distribute the capital released from exiting our
personal customer business in Norway as an extraordinary dividend
payment. The capital released is expected to amount to
approximately DKK 5.5 billion.
Distribution of remaining net profit for 2024
Finally, it is the intention of the Board of Directors to distribute the full
remaining net profit for full-year 2024 in 2025. This is subject to a
continually strong financial performance, relevant approvals,
including from the Danish Financial Supervisory Authority, and our
capital ratios remaining above the capital requirements.
Danske Bank’s dividend policy for 2025 and beyond remains
unchanged, targeting a dividend payout of 40-60% of net profit in the
form of annual dividend payments.
Danske Bank has strong capital and liquidity positions, and the Board
of Directors remains committed to our capital distribution policy.
At 30 September 2024, we had bought back around 18.7 million
shares for a total purchase amount of DKK 3.8 billion (figures at trade
date) of our planned DKK 5.5 billion share buy-back programme.
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Credit ratings
On 20 September 2024, S&P upgraded Danske Bank’s stand-alone
credit profile to ‘A’ from ‘S-’. Consequently, the rating of Danske
Bank’s non-preferred senior debt, subordinated tier 2 debt and
additional tier 1 capital instruments has been raised by one notch.
Danske Bank’s issuer rating was affirmed at ‘A+’, and the outlook
continues to be set at ‘stable’. At the same time, S&P upgraded
Danica Pension’s issuer rating to ‘A’ and raised Danica Pension’s
subordinated tier 2 debt rating one notch to ‘BBB+’.
Environmental, Social and Governance (ESG)
ratings
The ESG rating agencies monitored by Danske Bank did not change
their ratings of Danske Bank in the third quarter of 2024.
9
Danske Bank / Interim report – first nine months 2024
Danske Bank Group’s credit ratings
Counterparty rating
Deposits
Preferred senior debt
Issuer rating
Non-preferred senior debt
Subordinated Tier 2 debt
Additional Tier 1 capital instruments
Realkredit Danmark A/S's credit ratings
Fitch
AA-
Moody’s
Aa3/P-1
AA-/F1+
A1/P-1/Stable
S&P
Scope
AA-/A-1+
-
-
-
AA-/F1+
A1/P-1/Stable
A+/A-1
A+/S-1+/Stable
A+/F1/Stable
A1/P-1/Stable
A+/A-1/Stable
A+/S-1+/Stable
A+
A-
BBB
Baa1
-
-
A-
BBB+
BBB-
A/Stable
BBB+/Stable
BBB-/Stable
Issuer rating
A+/F1/Stable
A+/S-1+/Stable
Danske Mortgage Bank plc's credit ratings
Issuer rating
Danske Bank’s ESG ratings
CDP Worldwide, UK
ISS ESG, USA
MSCI ESG Ratings, USA
Sustainalytics, USA
A+/Stable
Score at
Score at
30 September 2024
30 June 2024
B
B
C+ Prime
C+ Prime
BBB
BBB
Low Risk
Low Risk
Financial highlights
Executive summary
Financial review
Business units
Financial statements
As previously announced, Danske Bank has been working towards
restarting its debt collection in respect of personal customer cases in
Denmark in collaboration with a debt collection agency, Lowell
Danmark A/S. The new debt collection system is live, and the first
cases for collection were transferred to Lowell Danmark A/S in
December 2023. Danske Bank has initially transferred the least
complex debt collection cases to Lowell Danmark A/S for collection.
The new IT system is continuously being enhanced and tested to
gradually handle more complex case types. 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 reviewers
appointed by the Danish FSA.
Independent expert
In 2021, the Danish FSA appointed an Independent Expert whose
role, among other things, was to monitor and report on the progress
with delivering on the Financial Crime Plan. The Danish FSA has
extended the appointment for an eighth period and has ordered
Danske Bank to let one or more experts follow the Bank for a period
of six months following the expiry of the previous period for which
experts were appointed. The purpose of the appointment is to follow
whether the Bank complies with its obligations to the US Department
of Justice (the DoJ) and with the Plea Agreement entered into by the
Bank in December 2022 as part of the criminal proceedings in the
Estonia case. Following this period, further reappointments of the
Independent Expert may be expected.
Estonia matter
In September, we announced that we had reached a resolution with
the French authorities regarding the Estonia matter, thereby settling
the final investigation into the bank by a public authority in relation to
the non-resident portfolio at Danske Bank’s former Estonia branch.
Personal Customers in Norway
Following the Forward ’28 strategy announcement in June 2023,
Danske Bank entered into an agreement to sell its personal 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 distributed to personal customers in
Norway.
On 7 February 2024, we announced that the Norwegian Financial
Supervisory Authority had approved the sale, and on 15 December
and 20 December 2023, the sale was approved by the Norwegian
Competition Authority and the Danish Financial Supervisory
Authority, respectively, and all required 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 employees. The
transaction is expected to be completed by the end of 2024.
Update on 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 September 2024, more than 95% 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 collection
customers who may have been subject to overcollection began in
2023. Since Danske Bank initiated compensation pay-out in May
2023, the Bank has attempted to pay out compensation to
approximately 85% of the customers in scope for the accelerated
data-driven solution (excluding estate 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 efforts to provide finality to affected debt
collection customers.
10
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Business units
Personal Customers
Our Personal Customers unit provides advisory services to personal customers and Private
Banking customers in Denmark, Sweden, Norway and Finland. Our advisers and experts are there
to help customers when and how it best suits the individual customer - at online meetings, via
our websites or, if so required, over the phone or at a branch.
When our customers need to make important financial decisions about, for example, their home,
investments or pension, we offer customised advice that is based on their current situation and
needs. And with our intuitive digital solutions, we aim to make it as easy as possible for our
customers to do most of their banking business whenever and wherever they want.
Business Customers
We offer our customers advice that adds value to their business, no matter whether the
customer is a sole proprietor or an entity in a multinational group. Our strategic advisory services
are always based on the needs of the business, for example in connection with growth, an
acquisition, a change of ownership, strategic development or international expansion.
Our business customers have access to the market’s most innovative digital solutions that make
day-to-day banking easy and pave the way for new insights and opportunities.
Large Corporates & Institutions
Large Corporates & Institutions caters to the most complex financing and transaction needs of
large corporate and institutional customers, and we help them to prosper and grow. We offer
expertise in financing, risk management, investments and financial advisory services, and our
customers have access to our award-winning transaction banking solutions. Thanks to our
extensive network and our many years of experience, we serve as intermediary between issuers
and investors with a view to creating financing and investment opportunities. Our goal is to be an
inspirational partner that understands the customers’ strategic agendas and offers tailored
solutions to meet their needs.
11
Danske Bank / Interim report – first nine months 2024
Danica Pension
Danica Pension’s strategy is based on our ambition to be our customers’ financial security
provider and thereby enhance customer satisfaction. We focus on proactively helping our
customers – both personal and business customers – to ensure that they have the right pension,
insurance and healthcare solutions, while we also generate attractive returns after costs and
contribute to creating a more sustainable society.
Northern Ireland
Danske Bank is the leading bank in Northern Ireland, serving personal, business and corporate
customers. The business is also a growing bank in targeted sectors across the rest of the United
Kingdom. We support our customers through face-to-face, online and mobile solutions. Our focus
in Northern Ireland is on remaining a stable, strong and risk-astute bank, consolidating our
market-leading position alongside pursuing prudent low-cost growth opportunities in the rest of
the UK.
Financial highlights
Executive summary
Financial review
Business units
Financial statements
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
Q1-Q3
2024
10,704
3,589
118
75
Q1-Q3
2023*
10,686
3,116
160
-627
14,485
13,335
7,242
113
7,243
-232
7,475
6,835
127
6,500
333
6,167
Loans, excluding reverse transactions before impairments
663,552
646,429
Allowance account, loans
Deposits, excluding repo deposits
Covered bonds issued
Allocated capital (average)
4,356
389,057
551,628
30,534
4,447
376,434
590,045
29,474
Index
24/23
100
115
74
-
109
106
89
111
-
121
103
98
103
93
104
Q3
2024
3,613
1,069
46
42
4,770
2,377
41
2,394
-53
2,447
Q2
2024
3,547
1,321
37
18
4,923
2,545
31
2,377
78
2,299
663,552
655,043
4,356
389,057
551,628
30,187
4,348
391,010
556,955
30,352
Net interest income as % p.a. of loans and deposits**
1.39
1.41
1.40
1.39
Profit before loan impairment charges as % p.a. of
allocated capital
31.6
29.4
Profit before tax as % p.a. of allocated capital (avg.)
32.6
27.9
Cost/income ratio (%)
Full-time-equivalent staff
50.0
51.3
3,976
4,179
95
31.7
32.4
49.8
3,976
31.3
30.3
51.7
4,020
* Comparative information has been restated as described in note G2(b).
** Net interest income as % p.a. of loans and deposits excludes loans and deposits included in the sale of the personal customer business in Norway.
Index
Q3/Q2
102
81
124
233
97
93
132
101
-
106
101
100
100
99
99
99
Q3
2023*
3,669
1,030
53
23
4,775
2,373
42
2,402
-145
2,547
646,429
4,447
376,434
590,045
29,274
1.46
32.8
34.8
49.7
4,179
Index
24/23
98
104
87
183
100
100
98
100
37
96
103
98
103
93
103
Full year
2023*
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
95
4,064
Fact Book Q3 2024 provides financial highlights at customer type level for Personal Customers, Fact Book Q3 2024 is available at danskebank.com/ir.
Personal Customers
During the first nine months of 2024, we continued to support our
customers in managing their finances in a market environment
characterised by falling interest rate levels. After some stabilisation
early in the period, rates have now started to decrease, with two
central bank rate cuts so far. The housing market generally
witnessed a consistently upward trend following a decline over year-
end after a frontloading of trades in and around Copenhagen towards
the end of 2023. The frontloading of trades was caused by the
anticipated effect of new property tax regulation that took effect at
the start of 2024.
In the first nine months of 2024, our Danske Bolig Fri home finance
products were in high demand and were named 'Best in Test' by the
Danish Consumer Council. The same was the case for our loans
targeting first-time home buyers, highlighting our dedication to
quality and innovation in home financing. Additionally, we were
named the preferred bank for 'Online Advice' by MyBanker. We also
saw an increased flow of customers into our Private Banking unit,
supported by the successful launch of our first annual Private
Banking summits held across Denmark.
Profit before tax amounted to DKK 7,475 million in the first nine
months of 2024, representing an increase of 21% from the year-
earlier period. Adjusted for the one-off provision in 2023 of DKK 693
million that was recognised under Other income in relation to the
divestment of our personal customer business in Norway, the
increase was 9%. The result was fuelled primarily by an increase in
net fee income, particularly from everyday banking and investment
fees, and a net loan impairment reversal. Moreover, we recorded an
increase in fees due to a non-recurring discount related to a vendor
agreement, which had a retroactive effect.
Business initiatives
During the first nine months of 2024, the economies in our core
markets saw a positive development that was characterised by
stable to gradually declining inflation and lower interest rates. Our
products have gained significant recognition, and overall, market
perception of our offerings has improved.
12
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
In the investment area, customer activity stayed on a positive
trajectory, not least fuelled by favourable financial markets and
decreasing interest rates. Assets under management (AuM packaged
products) have increased DKK 39 billion since the end of 2023,
bolstered by a net sale inflow of DKK 10.6 billion. Notably, we
experienced an improved inflow in Sweden. In addition, our funds
performed well relative to those of our peers, which further
supported AuM and investment fees. As a result, we observed a
continued increase in market share for our Danske Invest retail funds
in Denmark – a trend that has now continued for 5 consecutive
quarters.
Finally, we have broadened our investment offering in Denmark by
making our asset management flagship product, Danske
Porteføljepleje Classic, available to all personal customers, while
phasing out the Flexinvest Fri product. Furthermore, customers in
Denmark now enjoy reduced trading commissions on trades outside
the Nordic countries, making it more attractive for them to diversify
their investment portfolio.
In the home finance area, we introduced new and more attractive
interest rates on cooperative housing loans in the beginning of the
year. In June, we expanded our energy improvement loans to include
climate adaptation projects, simultaneously providing our customers
with access to expert advice from our partner OBH.
In Denmark, we have lowered the interest rate spread on the last 15%
of home financing, which is typically covered by a bank loan and is
not eligible for a mortgage loan. This adjustment represents a
significant step forward for homebuyers as it facilitates access to the
housing market for many and ensures more competitive pricing in
the future.
In Sweden, we saw improving customer activity in the second and
third quarters of 2024, highlighted by an increase in advisory
meetings and in mortgage loan applications. To further support our
Forward ’28 growth strategy, we have implemented several price
changes for our mortgage loans along with improvements in terms of
digitising and streamlining the lending process. Finally, we have
renewed our partnership agreement with TCO to focus more on
premium customers with larger volumes.
In Finland, we expanded our key commercial partnership with AKAVA,
which targets students, while the Fennia insurance partnership was
expanded with the launch of a new API integration.
13
Danske Bank / Interim report – first nine months 2024
Q1-Q3 2024 vs Q1-Q3 2023
Profit before tax increased to DKK 7,475 million (Q1-Q3 2023:
DKK 6,167 million), up 9% after adjustment for the provision in 2023
related to the divestment of our personal customer business in
Norway. The result was driven by higher net fee income and a net
loan impairment reversal.
Net interest income remained stable relative to the same period in
2023, amounting to DKK 10,704 million (Q1-Q3 2023: DKK 10,686
million). Excluding the personal customer business in Norway, the
increase was 1%. The development was driven largely by our
activities in Finland and Denmark, with the increase being due
primarily to larger volumes as well as product development
initiatives. Lending margins were under pressure from the rise in
market rates relative to the same period last year, but market rates
were lowered in the third quarter of 2024.
Fuelled by our savings products, total deposit volumes for Personal
Customers increased 3% from the level at the end of 2023. The
increase was driven by our Private Banking unit, which saw an
increase of 12%, and Personal Customers Denmark and Finland,
which both saw increases of 2%. The depreciation of the Swedish
krona had a small negative effect.
Total bank lending saw a flat development. Personal Customers
Denmark saw a 2% increase driven by home finance products such
as Danske Bolig Fri. The nominal mortgage lending volume in
Denmark decreased 2%. Personal Customers Sweden saw a
decrease despite good customer activity, and there was a further
negative effect of DKK 1.5 billion from the depreciation of the
Swedish krona. Total lending across markets matched the level at the
end of 2023 due to favourable fair value adjustments.
Net fee income increased to DKK 3,589 million (Q1-Q3 2023:
DKK 3,116 million), driven primarily by higher investment fees and
everyday banking fees. Investment fees increased due to the
increase in assets under advice (AuA) resulting from the favourable
financial markets, an improved fund performance and higher net
sales. Fee income from financing activity decreased due to lower
customer activity in the first nine months of 2024 than in the year-
earlier period, when customer activity was very high due to high
remortgaging activity triggered by the increase in market rates. In
addition, we saw a non-recurring effect related to a new vendor
agreement, which had a retroactive effect.
Net trading income was down to DKK 118 million (Q1-Q3 2023:
DKK 160 million) as a result of a decrease in loan termination fees
related to the fall in interest rates.
Operating expenses rose to DKK 7,242 million (Q1-Q3 2023:
DKK 6,835 million). The rise was driven by investments made in
accordance with our Forward ’28 strategy and higher bonus
payments.
Credit quality remained strong. The increases in interest rates and
the cost of living during 2023 were mitigated by household savings
and strong labour markets. Average loan-to-value ratio levels
remained low.
Loan impairment charges amounted to a net reversal of DKK 232
million in the first nine months of 2024, against charges of DKK 333
million in same period of 2023, when impairments were impacted by
the worsened macroeconomic scenarios. Impairments for the first
nine months of 2024 benefited from the improved macroeconomic
outlook, which also led to a reduction in post-model adjustments.
Credit exposure
Net credit exposure from lending activities amounted to DKK 809
billion at the end of the third quarter of 2024, which was a decrease
from DKK 844 billion at the end of 2023 that was driven primarily by
a decrease in exposure to personal customers in Norway.
Q3 2024 vs Q2 2024
Total income decreased to DKK 4,770 million in the third quarter
(Q2 2024: DKK 4,923 million) due to a decrease in fee income
related to non-recurring effects being booked in the second
quarter combined with a fall in financing fees that was impacted
by a slowdown during the summer period.
• Net interest income saw a 2% increase from the preceding
quarter. Despite the central bank rate cuts, income from
deposits increased as a result of larger deposit volumes and
relatively stable deposit margins due to a combination of
repricing actions and our interest rate hedging framework.
• Net fee income decreased 19% from the preceding quarter due
to non-recurring effects related to a new vendor agreement
being booked in the preceding quarter combined with a fall in
financing fees that was impacted by a slowdown during the
summer period.
• Operating expenses decreased relative to the preceding
quarter due to good cost control and reversals of tax on labour
costs.
• The third quarter of 2024 saw low loan impairment reversals of
DKK 53 million (Q2 2024: DKK 78 million) related to reductions
in post-model adjustments.
Profit before tax
DKK 2,447 million
for the third quarter of 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
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
Q1-Q3
2024
8,682
1,680
17
521
Q1-Q3
2023*
8,605
1,608
37
796
10,900
11,045
3,949
170
6,951
265
6,686
3,708
191
7,337
246
7,091
Loans, excluding reverse transactions before impairments
664,074
639,620
Allowance account, loans
Deposits, excluding repo deposits
Covered bonds issued
Allocated capital (average)
9,623
244,904
387,715
42,115
9,166
264,033
358,685
39,455
Index
24/23
101
104
46
65
99
106
89
95
108
94
104
105
93
108
107
Q3
2024
2,912
509
-1
122
3,541
1,322
58
2,219
-326
2,545
Q2
2024
2,877
581
13
183
3,654
1,353
51
2,301
-118
2,419
664,074
655,140
9,623
244,904
387,715
42,315
9,966
251,626
373,981
42,156
Net interest income as % p.a. of loans and deposits
1.29
1.27
1.29
1.29
Profit before loan impairment charges as % p.a. of
allocated capital
22.0
24.8
Profit before tax as % p.a. of allocated capital (avg.)
21.2
24.0
Cost/income ratio (%)
Full-time-equivalent staff
36.2
33.6
1,728
1,652
105
21.0
24.1
37.3
1,728
21.8
23.0
37.0
1,688
*Comparative information has been restated as described in note G2(b).
Index
Q3/Q2
101
88
-
67
97
98
114
96
276
105
101
97
97
104
100
102
Q3
2023*
2,742
495
-5
259
3,491
1,253
64
2,237
104
2,133
639,620
9,166
264,033
358,685
39,450
1.23
22.7
21.6
35.9
1,652
Index
24/23
106
103
20
47
101
106
91
99
-
119
104
105
93
108
107
Full year
2023*
11,684
2,190
54
1,024
14,952
5,255
255
9,698
431
9,267
654,246
9,511
257,076
371,605
39,644
1.29
24.5
23.4
35.1
105
1,646
Fact Book Q3 2024 provides financial highlights at customer type level for Business Customers. Fact Book Q3 2024 is available at danskebank.com/ir.
Business Customers
In the first nine months of 2024, the economic landscape in which we
operate continued to improve, due primarily to a stabilisation of
interest rates in the first part of the period, followed by interest rate
cuts by the central banks towards the latter part of the period. We
continued to expand the customer base in our focus segments. In
addition, we took strategic repricing actions and continued to
enhance support for our customers by providing the best possible
advice tailored to their needs.
Profit before tax for the first nine months of 2024 amounted to DKK
6,686 million, a decrease of 6% from the same period last year. Net
fee income rose as a result of our subscription-based fee service
model as well as repricing actions. However, we saw an increase in
operating expenses attributable to investments made under our
Forward ’28 strategy.
Business initiatives
At Business Customers, we continued to support our customers
across segments, focusing on providing the best possible advice and
solutions tailored to their needs. Building on this, we continued to
enhance the digital accessibility of our products by expanding the
range of offerings available via our Marketplace self-service
platform.
During the first nine months of 2024, we generally saw good
progress in terms of customer inflows and a positive development in
lending volumes in our medium-sized business segment in line with
our Forward ’28 strategy. We also experienced growth among
subsidiaries of international businesses, which underscores our
strong offerings and ability to attract customers with international
needs in alignment with our strategic objectives.
Sustainability continues to be an important agenda for our
customers and for us, and Danske Bank has been ranked best in
industry on parameters within ‘Sustainability’ & ‘Advisory’ for
business customers in Sweden in a customer satisfaction survey
conducted by SKI (Svenskt Kvalitetsindex).
14
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
As one of our latest initiatives on sustainability, we have entered into
partnerships with Sweco, one of Europe’s largest architecture and
engineering consultancies, and climate tech company Comundo to
further support the green transition of our commercial real estate
customers. The ambition is to increase the number of customers in
scope for these two partnerships. Through the partnerships, we are
able to offer a streamlined customer journey, which combined with
our advisory and financing solutions can support our customers in
reducing CO2-emissions from properties.
Moreover, we are continuing our strategic collaboration with the
European Investment Fund (EIF) to support the growth of small and
medium-sized businesses across the Nordic countries. In the initial
phase, EIF loan guarantees are offered to our customers in Finland to
support them in their sustainability transition.
In our medium-sized segment, we have rolled out a cross-Nordic
setup to handle leveraged finance transactions for customers being
bought by Private Equity Funds. Likewise, we have scaled up our
Corporate Finance offerings in Denmark and Norway, providing
current and future customers with better access to specialist
competencies and advisory services.
Q1-Q3 2024 vs Q1-Q3 2023
Profit before tax amounted to DKK 6,686 million (Q1-Q3 2023:
DKK 7,091 million). An increase in net fee income was more than
offset by increased operating expenses due to further investments
made in accordance with our Forward ’28 strategy.
Net interest income increased 1% from the level in the same period
last year. We saw a decrease in net interest income from lending due
to lower bank lending volumes and narrowing lending margins
resulting from the increase in funding costs from the level in the first
nine months of 2023. However, increasing deposit margins more
than countered this decrease, even if some of the positive effect was
offset by a tactical outflow of deposit volumes relative to end-
September 2023 that was driven mainly by the public sector in
Norway.
Net fee income increased to DKK 1,680 million (Q1-Q3 2023:
DKK 1,608 million). The increase was driven primarily by everyday
banking fees due to repricing actions.
15
Danske Bank / Interim report – first nine months 2024
Other income decreased to DKK 521 million (Q1-Q3 2023: DKK 796
million). The decrease was the result of lower income from the sale of
assets in our leasing activities than in the first nine months of 2023,
when sales were extraordinarily high. In February 2024, we sold the
Norwegian company Tyssekraft A/S, which had a positive effect on
other income of DKK 21 million.
Credit exposure
Net credit exposure from lending activities amounted to DKK 754
billion at the end of September 2024, an increase from DKK 745
billion at the end of 2023 that was driven primarily by an increase in
exposure to the Commercial property, Private housing co-ops and
non-profit associations, and Services segments.
Operating expenses amounted to DKK 3,949 million, an increase of
6% from the level in the same period last year. The increase was
driven by investments made in accordance with our Forward ’28
strategy combined with a generally higher cost level as a result of
inflation.
Deposit volumes across Business Customers decreased 5% relative
to the end of 2023. The development in Finland was stable, driven by
an inflow of public-sector customers. In Norway, we continued to
tactically reduce public-sector deposits. Both the Swedish krona and
the Norwegian krone depreciated further, with a total effect of
DKK 2.7 billion since the end of 2023.
Supported by our strategy execution, we saw an increase in bank
lending volumes in local currency across our Nordic markets. The
depreciation of the currencies in Norway and Sweden had an adverse
effect on total bank lending of DKK 4.9 billion. Adjusted for this, the
increase was 3% relative to the end of 2023. Mortgage volumes
increased 1% relative to the level at the end of 2023. Combined with
the increase in bank lending, this meant that total lending volumes
after fair value adjustments increased 2%.
Overall, credit quality remained strong. Higher interest rates and
increasing inflation caused a negative rating trend for the year in
2023. However, as of the third quarter of 2024, the rating trend has
stabilised.
Loan impairment charges amounted to DKK 265 million in the first
nine months of 2024 (Q1-Q3 2023: DKK 246 million) and were driven
by a few single-name cases in our leasing operations and an increase
in post-model adjustments.
Q3 2024 vs Q2 2024
Profit before tax increased to DKK 2,545 million in the third
quarter of 2024 (Q2 2024: DKK 2,419 million) as the positive
effect from loan impairment reversals was partially countered by
a decrease in income related to a slowdown during the summer
period that resulted in lower financing fees and lower income
from the sale of assets.
• Net interest income increased 1% to DKK 2,912 million (Q2
2024: DKK 2,877 million). Though we saw headwind on
deposits due to declining rates, this was countered by other net
interest income items.
• Net fee income declined 12% from the second quarter of 2024
due to a slowdown during the summer period that caused a
decrease in financing fees.
• Operating expenses decreased 2% due to reversals of tax on
labour costs.
• Other income decreased, primarily as a result of lower sales of
assets.
• The third quarter of 2024 saw loan impairment reversals of
DKK 326 million that were driven by our mid-corporate
segment (Q2 2024: net reversals of DKK 118 million).
Profit before tax
DKK 2,545 million
for the third quarter of 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
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)
Q1-Q3
2024
5,212
4,964
1,884
1
Q1-Q3
2023*
5,140
4,497
2,115
12
12,061
11,763
5,435
345
6,626
-403
7,029
297,589
274,166
1,944
330,703
282,026
28,289
40,455
5,273
368
6,491
-163
6,653
298,655
267,546
1,799
362,049
297,585
29,391
40,312
Index
24/23
101
110
89
8
103
103
94
102
247
106
100
102
108
91
95
96
100
Q3
2024
1,717
1,698
598
-
4,013
1,883
111
2,130
110
2,020
297,589
274,166
1,944
330,703
282,026
28,289
40,357
Q2
2024
1,766
1,745
472
1
3,984
1,794
109
2,190
-137
2,327
296,000
269,744
1,458
328,530
276,647
28,067
40,422
Index
Q3/Q2
97
97
127
-
101
105
102
97
-
87
101
102
133
101
102
101
100
Net interest income as % p.a. of loans and deposits
1.11
1.04
1.10
1.14
Profit before loan impairment charges as % p.a. of
allocated capital
21.8
21.5
Profit before tax as % p.a. of allocated capital (avg.)
23.2
22.0
45.1
44.8
Cost/income ratio (%)
Full-time-equivalent staff
*Comparative information has been restated as described in note G2(b).
21.1
20.0
46.9
21.7
23.0
45.0
Q3
2023*
1,727
1,562
447
-
3,736
1,730
123
2,006
359
1,647
298,655
267,546
1,799
362,049
297,585
29,391
40,597
1.09
19.8
16.2
46.3
Index
24/23
99
109
134
-
107
109
90
106
31
123
100
102
108
91
95
96
99
Full year
2023*
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
2,115
2,098
101
2,115
2,105
100
2,098
101
2,085
Large Corporates &
Institutions
In the first nine months of 2024, geopolitical uncertainty persisted,
though macroeconomic sentiment and indicators were more positive
than expected. We continued to see a positive underlying
momentum, particularly in our fee business as higher fees from
assets under management, everyday banking products and capital
markets activities mitigated the decline in net trading income, thus
demonstrating the value of our diversified business model.
Furthermore, we continued to leverage our strategic commercial
strengths as reflected in growth in our corporate customer portfolio
outside Denmark, an increased market share of cash management
services and the maintaining of our leading position in sustainable
finance.
Profit before tax increased to DKK 7,029 million, an increase of 6%
from the same period last year. The increase was driven by higher
net fee income and loan impairment reversals, although the increase
was partly offset by lower net trading income.
Business initiatives
The first nine months of 2024 were characterised by increasing
optimism in the capital markets as the economic outlook in the
Nordic countries was more positive than expected. As a result, we
saw a solid development in our capital markets business. Debt
Capital Markets conditions were attractive, and we saw strong
activity during the first nine months of the year as funding conditions
improved. We thus remained the leading Nordic bank in the
European debt capital markets in terms of volumes supported.
Among several highlights, we supported Mandatum in raising EUR
300 million in green bonds under their highly successful issue and
Nordic Investment Bank with two green bond issues of EUR 750
million and SEK 1 billion. Furthermore, we acted as joint bookrunner
for UPM in their EUR 600 million green bond issue.
In Equity Capital Markets, the first nine months of the year were
characterised by continually low market volumes, however, we see
tentative signs of more active markets when looking into the fourth
quarter and further ahead. Within M&A advisory services, we saw
16
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
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***
Total assets under management****
Q1-Q3
2024
6,348
3,447
60
1,747
77
520
Q1-Q3
2023*
6,222
3,708
-55
1,556
34
278
12,061
11,763
Index
24/23
102
93
-
112
226
187
103
Q3
2024
2,099
1,130
14
617
28
168
Q2
2024
2,139
998
25
603
39
244
4,013
3,984
497,837
363,514
861,351
387,268
310,657
697,925
129
117
123
497,837
363,514
861,351
484,181
355,771
839,952
Index
Q3/Q2
98
113
56
102
72
69
101
103
102
103
Q3
2023*
2,068
993
-16
558
21
117
3,736
Index
24/23
101
114
-
111
133
144
107
Full year
2023*
8,378
4,628
21
2,334
302
437
15,777
387,268
310,657
697,925
129
117
123
442,473
328,584
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 2023, FVA is calculated to include both funding cost
and funding benefit, and therefore DVA is offset to avoid double counting 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.
rising deal appetite as advisory needs have become more relevant
across the Nordic countries. In Loan Capital Markets, we have seen
good activity so far in 2024 and are proud to have supported the
financing of some of the largest transactions in Europe, such as
Carlsberg’s acquisition of Britvic PLC of GBP 3.3 billion and the DSV
acquisition of DB Schenker with a transaction value of EUR 14.3
billion.
In Asset Management, we saw strong progress on our journey
towards simplifying our value chain, and we are pleased to report an
increasing market share in Danske Invest. Furthermore, we
continuously expand our sustainability education efforts towards our
employees and remain a leader in external certifications among
asset managers in the Nordic countries.
Q1-Q3 2024 vs Q1-Q3 2023
Profit before tax increased to DKK 7,029 million (Q1-Q3 2023: DKK
6,653 million), with the increase driven by higher net fee income and
loan impairment reversals, although the increase was partly offset by
lower net trading income.
Net interest income increased to DKK 5,212 million (Q1-Q3 2023: DKK
5,140 million) as a result of higher income from other interest items,
although the effect was partly offset by lower lending margins and
deposit volumes. Lending volumes in General Banking increased 4%
from the end of 2023 and were driven primarily by corporate
customers in Sweden. Deposit volumes decreased 14% from the
level at the end of 2023 as we saw an increase in corporate
customers choosing to reinvest their cash holdings. 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 nine months of
2024.
Net fee income increased to DKK 4,964 million (Q1-Q3 2023: DKK
4,497 million) as we saw a widespread increase in fees from assets
under management, everyday banking products and capital markets
advisory services.
We continued to increase our market share within cash management
by adding new house bank mandates in the first nine months of
2024. 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 institutional and private banking segments, which
17
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
contributed to positive net sales. Furthermore, we continued our
strong investment performance relative to both peers and
benchmarks, particularly across our hedge fund franchise and multi-
asset solutions.
Net trading income decreased to DKK 1,884 million (Q1-Q3 2023:
DKK 2,115 million) as an extraordinarily strong result in the first half
of 2023 drove the year-earlier income level. Relatively low secondary
customer activity also affected net trading income in the first nine
months of 2024.
Operating expenses increased and amounted to DKK 5,435 million
(Q1-Q3 2023: DKK 5,273 million) as a result of higher digitisation
investments.
Overall, credit quality remained strong in the first nine months of
2024 and has proven resilient in the face of external economic
uncertainty. Loan impairment charges in the first nine months
amounted to a net reversal of DKK 403 million (Q1-Q3 2023: net
reversal of DKK 163 million). Reversals continue to be driven by
successful restructuring activities.
Credit exposure
Net credit exposure from lending activities increased to DKK 687
billion at the end of the third quarter of 2024 (end-2023: DKK 633
billion). The increase was driven primarily by an increase in exposure
to the Transportation, Pharma and medical devices, and Consumer
goods segments.
18
Danske Bank / Interim report – first nine months 2024
Q3 2024 vs Q2 2024
Profit before tax decreased to DKK 2,020 million (Q2 2024: DKK
2,327 million), primarily because of higher operating expenses
and loan impairment charges, although the increases in these
items were partly offset by higher net trading income.
• Net interest income decreased to DKK 1,717 million (Q2 2024:
DKK 1,766 million) as a result of lower deposit margins.
• Net fee income decreased to DKK 1,698 million (Q2 2024:
DKK 1,745 million), mainly as a result of lower capital markets
fees.
• Net trading income increased to DKK 598 million (Q2 2024:
DKK 472 million), with the increase being driven by higher
customer activity and more favourable market conditions on
the back of central bank actions.
• Operating expenses increased to DKK 1,883 million (Q2 2024:
DKK 1,794 million), with the increase being caused primarily by
higher provisions for performance-based compensation.
• Loan impairment charges amounted to DKK 110 million (Q2
2024: reversal of DKK 137 million). Loan impairment charges
were attributable to single-name exposures, while overall
credit quality remained resilient.
Profit before tax
DKK 2,020 million
for the third quarter of 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
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)
Q1-Q3
2024
393
935
79
1,407
Q1-Q3
2023
609
243
69
922
522,851
506,094
26,264
20,152
20,784
19,644
Index
24/23
65
-
114
153
103
126
103
Net income as % p.a. of allocated capital
9.3
6.3
Solvency coverage ratio
Full-time-equivalent staff
216
213
920
905
-
Q3
2024
-68
514
13
459
Q2
2024
271
179
6
457
522,851
520,986
26,264
20,392
25,608
19,854
9.0
9.2
216
920
217
912
Index
Q3/Q2
-
287
217
100
100
103
103
-
Q3
2023
175
2
57
233
506,094
20,784
19,825
4.7
213
905
Index
24/23
Full year
2023
-
-
23
197
103
126
103
-
779
615
78
1,472
493,544
23,113
19,738
7.5
170
912
Asset under management
(DKK millions)
Total
Premiums
(DKK millions)
479,900
412,451
116
479,900
466,778
103
412,451
116
440,319
Gross premiums, Denmark
32,483
29,458
110
10,914
11,022
99
9,407
116
38,647
Danica Pension
Through high levels of volatility, the global markets continued their
positive trend in the third quarter of 2024. Despite seeing a large
decline in August, the markets quickly recovered and regained the
positive momentum following expectations of central bank rate cuts.
The investment return on our pension customers’ savings in the first
nine months of the year profited from the favourable trend in the
global financial markets. We have thus had a prolonged period
throughout 2023 and 2024 during which we have been able to
deliver significant returns for our customers.
However, we continued to see challenges in the health and accident
business due to a rise in new health and accident claims. This reflects
the general trend in society and has also resulted in an increase in
provisions for insurance contracts.
Net income at Danica Pension increased to DKK 1,407 million in the
first nine months of 2024, up 53% from the level in the first nine
months of 2023, due to an increase in the net financial result.
Business initiatives
New strategy for Danica Pension
Danica Pension has developed a new commercial strategy, which will
apply from 1 January 2025 and will replace the current strategy. The
content of the strategy will be presented externally in the fourth
quarter of 2024 and will include a series of strategic ambitions,
commercial objectives and the plans for achieving those ambitions
and objectives.
Revised pricing structure
Danica Pension is revising the pricing structure for employees in
small and medium-sized enterprises (SMEs) in response to recent
regulatory changes requiring life insurance companies to balance
income and expenses in their health and accident business.
Customers will thus experience an increase in health insurance
premiums and a discount on investment costs. This change aims to
attract more SMEs, leveraging Danica Pension's strong relationship
with such businesses through Danske Bank. The impact on
customers will vary; some may see cost increases, others will break
19
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
even, and some will benefit. Overall, the aim is to ensure that the
majority of customers will benefit from the new structure. The
revised pricing structure for SMEs corresponds to the repricing of
individual corporate agreements that has been ongoing since 2022.
Pioneering effort in carbon capture
As part of Danica Properties' broader efforts to reduce its carbon
footprint and support the development of future climate solutions,
Danica Pension has launched a pioneering pilot project in Aarhus,
establishing the world's first integrated carbon capture system in a
commercial property. This innovative system is designed to capture,
store and utilise CO2 from indoor air, specifically targeting emissions
from human respiration at the workplace.
Q1-Q3 2024 vs Q1-Q3 2023
Net income at Danica Pension amounted to DKK 1,407 million (Q1-Q3
2023: DKK 922 million). The increase was due to an increase in the
net financial result, which more than offset the decrease in the
insurance service result.
The insurance service result decreased to DKK 393 million (Q1-Q3
2023: DKK 609 million) as Danica Pension continued to see a rise in
new health and accident claims, which reflects the general trend in
society and has also resulted in an increase in provisions for
insurance contracts.
The net financial result increased to DKK 935 million (Q1-Q3 2023:
DKK 243 million) due to the positive developments in the financial
markets, which lifted both the investment results on insurance
products where Danica Pension has the investment risk and the
investment result attributable to shareholders’ equity.
Assets under management continued the upward trend, showing an
increase of DKK 67 billion from the year-earlier period following the
positive development in the financial markets.
Premiums increased 10% from the same period in 2023 following an
increase in both single and regular premiums.
20
Danske Bank / Interim report – first nine months 2024
Q3 2024 vs Q2 2024
Net income at Danica Pension increased to DKK 459 million (Q2
2024: DKK 457 million) on the basis of an increase in the net
financial result, while the insurance service result decreased.
• The insurance service result decreased DKK 339 million, due
mainly to a rise in new health and accident claims, which has
also resulted in an increase in provisions for insurance
contracts.
• The net financial result increased in the third quarter of 2024
and amounted to DKK 514 million (Q2 2024: DKK 179 million).
The increase was attributable to a more positive development
in the investment results on insurance products where Danica
Pension has the investment risk and the investment result
attributable to shareholders’ equity.
• Total premiums decreased 1% following a minor decrease in
single premiums.
• Assets under management increased DKK 13 billion due
primarily to the positive developments in the financial markets
in the third quarter of 2024.
Net income in Danica Pension
DKK 459 million
for the third quarter of 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
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-Q3
2024
2,211
238
129
8
2,585
1,141
1,444
-62
1,506
Q1-Q3
2023
1,888
248
198
13
2,346
995
1,351
-119
1,469
Loans, excluding reverse transactions before impairments
64,002
59,353
Allowance account, loans
Deposits, excluding repo deposits
Allocated capital (average)*
752
106,712
6,392
745
97,696
6,466
Net interest income as % p.a. of loans and deposits
1.75
1.60
Profit before tax as % p.a. of allocated capital (avg.)
31.4
30.3
44.1
42.4
Cost/income ratio (%)
Full-time-equivalent staff
* Allocated capital equals the legal entity’s capital.
Index
24/23
117
96
65
62
110
115
107
52
103
108
101
109
99
Q3
2024
768
82
50
3
902
399
503
-65
568
Q2
2024
734
80
37
2
853
394
459
-21
481
64,002
63,100
752
795
106,712
103,458
6,724
6,289
1.76
1.74
33.8
30.6
44.2
46.2
Index
Q3/Q2
105
103
135
150
106
101
110
-
118
101
95
103
107
Q3
2023
652
80
145
3
880
339
541
13
528
59,353
745
97,696
7,177
1.63
29.4
38.5
Index
24/23
118
103
34
100
103
118
93
-
108
108
101
109
94
Full year
2023
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
1,248
1,261
99
1,248
1,240
101
1,261
99
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 a higher interest rate environment.
Profit before loan impairments was 7% higher than in the first nine
months of 2023, while profit before tax of DKK 1,506 million
represented an increase of 3% year-on-year.
Business initiatives
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.
The strategy in Northern Ireland aligns with the Group’s key focus
areas, including digitisation, customer journeys, sustainability, and
simplicity and efficiency, all underpinned by ensuring high levels of
employee engagement.
Acquisition of new personal and small business customers has
increased approximately 60% and 50%, respectively, year-on-year,
supported by successful customer bank switching campaigns.
Residential mortgage lending volumes have continued to grow,
supported by sustained demand for housing in the marketplace and
low unemployment levels. Customer lending was up 5% in local
currency.
The Bank of England (BoE) introduced a levy on all UK banks, effective
from 1 March 2024. This resulted in additional operating expenses of
DKK 10 million in the first nine months of 2024, albeit profit neutral
given an offsetting income benefit from broader BoE funding model
changes.
21
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Q1-Q3 2024 vs Q1-Q3 2023
Profit before tax increased 3% to DKK 1,506 million (Q1-Q3 2023:
DKK 1,469 million), reflecting a strong net interest income
performance. Profit before impairments was 7% higher than for the
same period in 2023.
Net interest income increased to DKK 2,211 million (Q1-Q3 2023:
DKK 1,888 million), driven by growth in lending, deposits and actions
taken in response to higher UK interest rates.
Net fee income decreased to DKK 238 million (Q1-Q3 2023: DKK 248
million), due primarily to the sale of our offsite ATM network in the
first half-year of 2023, with underlying activity and related fees
remaining robust.
Net trading income includes a positive mark-to-market movement of
DKK 98 million (Q1-Q3 2023: positive movement of DKK 163 million)
on the bank’s hedging portfolio, reflecting 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 income remained
volatile.
Operating expenses amounted to DKK 1,141 million (Q1-Q3 2023:
DKK 995 million). The increase was driven primarily by higher
regulatory costs (including the new BoE levy and higher costs for
anti-fraud measures) and higher costs for services provided by the
Group. The increase also incorporates the impact of inflationary
pressures on locally incurred costs. 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 net loan impairment reversal
of DKK 62 million relative to a net reversal of DKK 119 in the first nine
months of 2023.
22
Danske Bank / Interim report – first nine months 2024
Q3 2024 vs Q2 2024
The third quarter of 2024 saw profit before tax of DKK 568 million
(Q2 2024: DKK 481 million).
• Net interest income increased to DKK 768 million (Q2 2024:
DKK 734 million), reflecting continued growth in both lending
and deposits.
• Net fee income increased to DKK 82 million (Q2 2024: DKK 80
million), reflecting strong underlying activity levels.
• Net trading income amounted to DKK 50 million (Q2 2024:
DKK 37 million), primarily reflecting mark-to-market
movements on the hedging portfolio.
• Operating expenses increased to DKK 399 million (Q2 2024:
DKK 394 million), with higher costs for services provided by the
Group being partially offset by lower locally incurred costs.
• Loan impairment charges saw a further net reversal in the third
quarter, and we continue to have a strong focus on credit
quality.
Profit before tax
DKK 568 million
for the third quarter of 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
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-Q3
2024
642
-66
-38
-140
397
1,278
54
-881
-5
-876
Q1-Q3
2023*
-467
-46
-382
78
-817
2,042
54
-2,859
-4
-2,855
10,069
10,001
Index
24/23*
-
143
10
-
-
63
100
31
125
31
101
Q3
2024
155
-28
40
-26
141
248
18
-107
-2
-105
Q2
2024
222
-28
49
-57
185
395
18
-210
-2
-208
10,069
10,115
Index
Q3/Q2
70
100
82
46
76
63
100
51
100
50
100
Q3
2023*
528
-15
-751
132
-106
516
16
-622
-9
-613
Index
24/23*
29
187
-
-
-
48
113
17
22
17
Full year
2023*
-362
-92
-444
15
-884
1,998
72
-2,882
-1
-2,881
10,001
101
10,046
1,114
-194
-2
-1,857
63
-876
-1,053
61
-1
-1,808
-55
-2,855
-
-
200
103
-
31
439
-38
-1
-502
-2
-105
411
-25
-1
-585
-7
-208
107
152
100
86
29
50
-490
60
1
-154
-30
-613
-
-
-
-
7
17
-752
23
-
-2,065
-87
-2,881
*Comparative information has been restated as described in note G2(b).
Group Functions
Group Functions includes Group Treasury, Technology & Services and
other Group functions. In addition, Group Functions includes
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 nine months of 2024, the loss before tax was reduced and
amounted to DKK 876 million, against a loss of DKK 2,855 million in
the first nine months of 2023. The improvement was driven, among
other things, by an increase in net interest income to DKK 642 million
(Q1-Q3 2023: net expense of DKK 467 million) that related primarily
to higher interest income at Group Treasury’s Internal Bank, including
interest on shareholders’ equity.
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 expenses related to the sub-units within
Group Functions are allocated to the business units. This is done to
ensure cost efficiency throughout the Group.
We continue to improve our products to make everyday banking
simpler and safer. This includes implementing technology such as
GenAI and cloud-based solutions to reduce the use of legacy
platforms.
Q1-Q3 2024 vs Q1-Q3 2023
Group Functions posted a loss before tax of DKK 876 million (Q1-Q3
2023: a loss of DKK 2,855 million).
Net interest income increased to DKK 642 million (Q1-Q3 2023: net
expense of DKK 467 million). The increase was due primarily to
higher interest on shareholders’ equity and higher income from
Internal Bank allocation to business units, including interest rate risk
management costs related primarily to the hedging of the interest
23
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
rate risk on deposits to the business units, which is made in the form
of an internal deduction from deposit margins. The first nine months
of 2023 benefited from an interest compensation payment of
DKK 307 million from the Danish tax authorities.
Net trading income amounted to a loss of DKK 38 million (Q1-Q3
2023: a loss of DKK 382 million). The first nine months of 2023 were
affected by a release from Other comprehensive income of a loss of
DKK 786 million on a NOK structural CET1 FX branch hedge following
the announcement of Danske Bank’s exit from the personal
customer market in Norway and a one-off gain of DKK 327 million
related to the sale of shares taken over in connection with a loan.
Other income amounted to a loss of DKK 140 million (Q1-Q3 2023: an
income of DKK 78 million) related, among other things, to holdings in
associates. The first nine months of 2023 included a gain of DKK 104
million on the sale of Danske IT in India to Infosys.
Operating expenses decreased, due mainly to increased allocation to
the business units, and amounted to DKK 1,278 million (Q1-Q3 2023:
DKK 2,042 million). Furthermore, in the third quarter of 2024, an
insurance reimbursement of DKK 179 million was recognised.
Loan impairment charges amounted to a net reversal of DKK 5
million (Q1-Q3 2023: net reversal of DKK 4 million).
The number of full-time-equivalent staff was 10,069 (end-Q3 2023:
10,001).
24
Danske Bank / Interim report – first nine months 2024
Q3 2024 vs Q2 2024
Group Functions posted a loss before tax of DKK 105 million (Q2
2024: loss of DKK 208 million).
• Net interest income decreased to DKK 155 million (Q2 2024:
DKK 222 million). Group Treasury interest rate risk
management income and income on the bond portfolio that is
held at amortised cost increased. However, the increases were
more than offset by lower interest on shareholders’ equity and
lower income from Internal Bank allocations.
• Net trading income amounted to DKK 40 million (Q2 2024:
DKK 49 million).
• Operating expenses, after allocation to the business units,
amounted to DKK 248 million (Q2 2024: DKK 395 million). An
insurance reimbursement of DKK 179 million was recognised in
the third quarter.
• Loan impairment charges amounted to a net reversal of DKK 2
million (Q2 2024: net reversal of DKK 2 million).
Profit before tax
DKK -105 million
for the third quarter of 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Definition of alternative performance
measures
Danske Bank’s management believes that the alternative performance measures (APMs) used in the Management’s report provide valuable
information to readers of the financial statements. The APMs provide a more consistent basis for comparing the results of financial periods
and for assessing the performance of the Group and each individual business unit. They are also an important aspect of the way in which
Danske Bank’s management defines operating targets and monitors performance.
Throughout the Management’s report, performance is assessed on the basis of the financial highlights and segment reporting, which represent
the financial information regularly provided to management. There is no difference between the financial highlights and the IFRS income
statement.
Definitions of additional ratios presented on page 3 and in other sections of the Management’s report:
25
Danske Bank / Interim report – first nine months 2024
Ratios and key figures
Dividend per share (DKK)
Return on average shareholders’ equity (%
p.a.)
Net interest income as % p.a. of loans and
deposits
Definition
Total dividend per share, 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 shareholders
in the subsequent year.
Net profit as disclosed in the financial highlights divided by the average of the quarterly
average shareholders’ equity (beginning and end of each quarter) within the year. The
denominator represents equity equal to a decrease in the average of the quarterly average
equity of DKK 394 million (2023: a decrease of 540 million) compared to a simple average of
total equity (beginning and end of the period).
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 1.34% (2023: 1.26%) due to the daily average
of the sum of loans and deposits being DKK 14.9 billion lower (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 and impairment charges on goodwill 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
Allowance account as % of net credit
exposure
This ratio is calculated on the basis of loan impairment charges and loans and guarantees.
The numerator is the loan impairment charges of DKK -436 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),
Loans 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 beginning 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.
This ratio is calculated on the basis of the allowance account and loans and guarantees. The
numerator is the allowance account of DKK 20.2 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 statements. The denominator is the sum of Loans at amortised cost of
DKK 915.5 billion (2023: DKK 918.6 billion), Loans at fair value of DKK 758.2 billion (2023:
DKK 753.3 billion), Loans held for sale of DKK 77.8 billion (2023: DKK 110.4 billion) and
guarantees of DKK 92.9 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 business unit.
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Financial statements
Statements
Notes
Income statement – Danske Bank Group
Statement of comprehensive income – Danske
Bank Group
Balance sheet – Danske Bank Group
Statement of capital – Danske Bank Group
Cash flow statement – Danske Bank Group
27
27
28
29
31
G1. Material accounting policies and estimates
G2. Changes in accounting policies, Financial
highlights and segment reporting
G3. Business segments
G4. Income
G5. Loan impairment charges and reconciliation of
total allowance account
G6. Insurance assets and Insurance liabilities
G7. Issued bonds, subordinated debt and
additional tier 1 capital
G8. Assets held for sale and Liabilities in disposal
groups held for sale
G9. Other assets and Other liabilities
G10. Foreign currency translation reserve
G11. Guarantees, commitments and contingent
liabilities
G12. Assets provided or received as collateral
G13. Fair value information for financial
instruments
G14. Risk management notes
32
33
35
37
37
38
38
39
40
40
41
43
44
47
26
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Income statement – Danske Bank Group
Statement of comprehensive income – 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
Fee income
Fee expenses
Net fee income
Net trading income or loss
Insurance revenue
Insurance service expenses
Net return on investments backing insurance liabilities
Q1-Q3
2024
44,804
14,254
31,606
27,452
13,718
3,315
10,403
2,110
4,320
3,891
36,634
Q1-Q3
2023*
42,744
12,369
29,261
25,852
12,440
3,018
9,422
2,127
4,198
3,551
9,193
Q3
2024
Q3
Full year
2023*
2023*
Note
(DKK millions)
15,940
15,442
4,354
4,028
11,130
10,153
9,165
4,467
1,138
3,329
733
1,317
1,375
9,317
4,254
1,102
3,153
-111
1,436
1,253
59,770
16,287
41,085
34,972
17,108
4,203
12,904
2,613
5,735
5,094
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
G10
Hedging of units outside Denmark
Reclassification to the income statement on disposal of units outside Denmark**
12,424
-3,833
35,228
Unrealised value adjustments of bonds at fair value (OCI)
Net finance income or expense from insurance
-35,699
-8,949
-11,910
3,835
-34,613
Realised value adjustments of bonds at fair value (OCI)
Q1-Q3
2024
Q1-Q3
2023
17,634
15,497
Q3
2024
6,165
Q3
Full year
2023
5,319
2023
21,262
85
-1
86
-988
331
-
714
75
24
107
194
-1,019
-259
-760
-2,794
1,313
806
105
19
-101
-449
-1,209
43
-4
47
-175
16
-
941
35
210
607
654
-905
-244
-661
1,738
-947
806
166
33
438
1,358
697
-1,220
-301
-919
-1,404
589
806
1,114
106
306
905
-14
17,827
14,287
6,820
6,016
21,248
Tax*
Items that are or may be reclassified subsequently to profit or loss
Total other comprehensive income
Total comprehensive income
* A positive amount is a tax expense, and a negative amount is a tax income.
** Reclassification to the income statement on disposal of units outside Denmark in 2023 includes a reduction in the structural FX hedge.
G4
G4
Other insurance related income
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
G5
Loan impairment charges
Profit before tax
Tax
Net profit
Earnings per share (DKK)
Diluted earnings per share (DKK)
Dividend per share (DKK)***
43
1,407
41
423
464
31
922
-590
862
272
3
459
25
116
140
49
233
103
313
417
216
1,472
-555
1,015
460
41,836
38,595
13,826
13,009
52,422
19,046
22,790
-436
18,853
19,741
294
23,227
19,447
5,593
3,950
17,634
15,497
6,228
7,598
-337
7,935
1,770
6,165
6,211
6,797
322
6,475
1,156
5,319
25,478
26,944
262
26,682
5,420
21,262
20.7
18.0
7.2
6.2
24.8
20.7
18.0
7.2
6.2
24.7
7.5 7.0
-
-
14.5
* Comparative information has been restated, as described in note G2(a).
** Q3 2024 is affected by adjustments for Q1 – Q2 2024 between Interest income calculated using the effective interest method, Other interest income and Interest
expense.
***As announced in the Interim report – first half 2024, the Board of Directors approved an interim dividend of DKK 7.5 per share, which was paid out in July 2024.
27
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
30 September
31 December
30 September
2024
2023
2023
Note
(DKK millions)
167,989
167,975
514,297
266,255
915,451
980,599
75,477
526,507
78,099
6,165
10,133
34,496
259,156
114,813
548,189
283,914
918,628
928,239
70,900
496,031
110,704
6,064
3,264
272,280
134,158
602,915
279,830
902,384
905,580
66,847
506,426
118,408
6,069
3,930
31,079
30,371
G7
G7
G6
G8
G9
G7
G7
3,743,442
3,770,981
3,829,199
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
G10
Foreign currency translation reserve
Reserve for bonds at fair value (OCI)
Retained earnings
Proposed dividends
Total equity
Total liabilities and equity
30 September
31 December
30 September
2024
2023
2023
188,886
368,184
154,608
454,487
172,183
529,337
1,163,715
1,222,203
1,202,929
751,570
256,454
76,467
748,780
214,234
71,253
726,799
224,102
67,410
513,257
482,630
487,225
50,771
1,742
71,632
86,789
37,059
56,476
1,557
57,046
93,194
38,774
57,750
3,009
64,613
86,147
39,053
3,566,526
3,595,242
3,660,557
8,622
-3,296
482
8,622
-2,639
-306
8,622
-3,305
-1,402
171,107
163,596
164,726
-
6,466
-
176,916
175,739
168,642
3,743,442
3,770,981
3,829,199
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
G6
G8
Insurance assets
Assets held for sale
Intangible assets
Tax assets
G9
Other assets
Total assets
28
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
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
Reclassification on disposal 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
Foreign
currency
translation
reserve
Reserve for
bonds at fair
value (OCI)
Share
capital
Retained
earnings
Proposed
dividends
Total
(DKK millions)
Foreign
currency
translation
reserve
Reserve for
bonds at fair
value (OCI)
Share
capital
Retained
earnings
Proposed
dividends
8,622
-2,639
-306
163,596
6,466
175,739
Total equity as at 1 January 2023
8,622
-2,630
-1,526
155,812
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-988
331
-
-
-
-
-657
-657
-
-
-
-
-
-
-
-
714
75
-
788
788
-
-
-
17,634
85
-
-
-
-
-
-23
62
17,696
-
-
-
-
-
-
-
-
-
-
17,634
Net profit
Other comprehensive income
85
Remeasurement of defined benefit pension plans
-988
331
Translation of units outside Denmark
Hedging of units outside Denmark
-
Reclassification on disposal of units outside Denmark
714
75
-23
194
Unrealised value adjustments
Realised value adjustments
Tax
Total other comprehensive income
17,827
Total comprehensive income
Transactions with owners
-6,310
-6,466
-12,777
Dividends paid
-23,772
19,898
-23,772
Acquisition of own shares
19,898
Sale of own shares
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-2,794
1,313
806
-
-
-
-675
-675
-
-
-
-
-
-
-
-
105
19
-
124
124
-
-
-
15,497
-1,019
-
-
-
-
-
361
-659
14,838
-6,011
-17,349
17,437
Total
160,278
15,497
-1,019
-2,794
1,313
806
105
19
361
-1,209
14,287
-6,011
-17,349
17,437
168,642
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Total equity as at 30 September 2024
8,622
-3,296
482
171,107
176,916
Total equity as at 30 September 2023
8,622
-3,305
-1,402
164,726
* Dividends paid in 2024 consists of the dividend proposed to the AGM for the second half of 2023 and paid in March 2024, and the interim dividend approved by the
Board of Directors and paid in July 2024, net of dividends on own shares.
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
September 2024, the Group had acquired 18,667,665 shares for a total amount of DKK 3,779.4 million under the share buy-back programme.
Dividend
As announced in the Interim report – first half 2024, the Board of Directors approved an interim dividend of DKK 7.5 per share, which was paid
out in July 2024.
29
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
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
30 September 2024
31 December 2023
(DKK millions)
8,621,846,210
8,621,846,210
Total equity
862,184,621
862,184,621
Revaluation of domicile property at fair value
840,890,218
859,773,706
Tax effect of revaluation of domicile property at fair value
851,727,936
853,512,594
858,899,954
Total equity calculated in accordance with the rules of the Danish FSA
860,043,309
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 (%)
30 September 2024
31 December 2023
176,916
175,739
209
-27
177,098
177,098
-2,198
765
-986
211
-27
175,923
175,923
-914
1,634
-890
-
-
-4,114
-5,603
-2,672
293
-526
-959
-1,396
159,704
9,794
169,498
22,964
192,461
835,887
19.1%
20.3%
23.0%
-6,466
-5,690
-916
316
-733
-845
-6,111
155,308
14,805
170,113
20,790
190,902
827,882
18.8%
20.5%
23.1%
30
Danske Bank / Interim report – first nine months 2024
Total capital and the total risk exposure amount are calculated in accordance with the rules applicable under the Capital Requirements Regulation (CRR), taking
transitional rules into account as stipulated by the Danish Financial Supervisory Authority. In terms of the transitional arrangements for the impact of IFRS 9 on
regulatory capital, the Group applies the so-called dynamic approach in accordance with the CRR.
The Internal Capital Adequacy Assessment Report provides more details about the Group’s solvency need. The report is available at danskebank.com/investor-
relations/reports.
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Cash flow statement – Danske Bank Group
Q1-Q3
2024
23,227
-12,363
4,456
15,320
36,869
-52,410
-95
17,659
-16,179
-63,023
45,072
-1,099
9,274
-8,612
26
-523
-287
-
Q1-Q3
2023
19,447
-1,908
8,592
26,131
27,632
10,899
88
7,593
89,154
-27,446
60,316
-5,129
Full Year
2023
(DKK millions)
Cash flow from financing activities
26,682
Issue of subordinated debt
-4,565
Redemption of subordinated debt
8,426
Issue of non-preferred senior bonds
30,543
Redemption of non-preferred senior bonds
Dividends paid
Share buy back programme
Principal portion of lessee lease payments
10,778
-9,225
53
Cash flow from financing activities
3,509
Cash and cash equivalents as at 1 January
57,952
Foreign currency translation
-9,490
Change in cash and cash equivalents
73,513
Cash and cash equivalents, end of period
1,903
Cash and cash equivalents, end of period
-10,567
-18,036
Cash in hand
178,671
141,500
Demand deposits with central banks
Amounts due from credit institutions and central banks within three months
45
-391
-721
5
45
Total
-540
-841
7
-784
-1,062
-1,329
(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
31
Danske Bank / Interim report – first nine months 2024
Q1-Q3
2024
8,378
-10,748
21,604
-29,241
-12,777
-3,779
-454
Q1-Q3
2023
Full Year
2023
-
-
16,101
-23,377
-6,011
-
-
22,425
-23,696
-6,011
-
-
-450
-605
-7,887
-27,017
-13,737
365,609
232,531
232,531
998
-36,413
330,194
6,843
161,146
162,205
330,194
954
163,872
397,357
6,275
266,005
125,077
397,357
794
132,284
365,609
6,419
252,737
106,453
365,609
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Notes – Danske Bank Group
G1. Material accounting policies and estimates
(a) General
The report has been prepared in accordance with IAS 34, Interim Financial Reporting, as adopted by the EU, and additional Danish disclosure
requirements for listed financial companies. The report is condensed and should be read in conjunction with the Group’s Annual Report 2023.
With effect from 1 January 2024, the Group has changed the presentation in the IFRS Income statement in relation to Markets, Operating
leases and margins on customer transactions in foreign currencies. At the same time, the Group’s Financial highlights have been changed to
align them with the IFRS financial statements. The changes have been applied retrospectively, 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 7, IFRS 16, IAS 1 and IAS 7 became effective on 1 January 2024, and have no impact on the financial statements. Further information on
the changes to accounting policies and presentation in 2024 can be found in note G2(a). Except for these changes, the Group has not changed
its material accounting policies from those applied in Annual Report 2023. Annual Report 2023 provides a full description of the material
accounting policies.
Financial statement figures are stated in Danish kroner and whole millions, unless otherwise stated. As a result, rounding discrepancies may
occur because totals have been rounded off and the underlying decimals are not presented to financial statement users. The interim report for
the first nine months 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 includes
judgements made when applying accounting policies. The most significant judgements made when applying accounting policies relate to the
classification of financial assets and financial liabilities under IFRS 9, especially related to the business model assessment, and the solely
payments of principal and interest (SPPI) test (further explained in note G15 of the Annual Report 2023) and the designation of financial
liabilities at fair value through profit or loss to eliminate or significantly reduce an accounting mismatch (further explained in note G16 of the
Annual Report 2023). An overview of the classification and measurement basis for financial 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 premises may be incomplete, unexpected future events or situations may occur, and other parties may arrive at other
estimated values. In view of the inherent uncertainties and the high level of subjectivity and judgement involved in the recognition and
measurement of the items listed below, it is possible that the outcomes in the next reporting period could differ from those on which
management’s estimates are based.
Measurement of expected credit losses on loans, financial guarantees and loan commitments, and bonds measured at amortised cost or
fair value through other comprehensive income
The three-stage expected credit loss impairment model in IFRS 9 depends on whether the credit risk has increased significantly since initial
recognition. If the credit risk has not increased significantly, the impairment charge equals the expected credit losses resulting from default
events that are possible within the next 12 months (stage 1). If the credit risk has increased significantly, the loan is more than 30 days past
due, or the loan is in default or otherwise impaired, the impairment charge equals the lifetime expected credit losses (stages 2 and 3). In
32
Danske Bank / Interim report – first nine months 2024
determining the impairment for expected credit losses, management exercises judgement and uses estimates and assumptions as explained
in the following paragraphs.
The expected credit losses are calculated for all individual facilities as a function of probability of default (PD), exposure at default (EAD) and
loss given default (LGD) and incorporate forward-looking information. The estimation of expected credit losses involves forecasting future
economic conditions over a number of years. Such forecasts are subject to management judgement and those judgements may be sources of
measurement uncertainty that have significant risk of resulting in a material adjustment to a carrying amount in future periods. The
incorporation of forward-looking elements reflects the expectations of the Group’s senior management and involves the creation of scenarios
(base case, upside and downside), including an assessment of the probability for each scenario. The purpose of using multiple scenarios is to
model the non-linear impact of assumptions about macroeconomic factors on the expected credit losses. Note G14 provides information on
the scenarios as at 30 September 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 assessments, the allowance
account as at 30 September 2024 amounted to DKK 20.2 billion (31 December 2023: DKK 20.1 billion). If the base case scenario was assigned a
probability of 100%, the allowance account would decrease DKK 2.2 billion (31 December 2023: DKK 2.0 billion). Compared to the base case
scenario, the allowance account would increase DKK 11.0 billion (31 December 2023: DKK 10.2 billion), if the downside scenario was assigned a
probability of 100%. The increase reflects primarily the transfer of exposures from stage 1 to stage 2 and increased expected credit losses
within stage 2. If instead the upside scenario was assigned a probability of 100%, the allowance account would decrease DKK 0.2 billion (31
December 2023: DKK 0.2 billion) compared to the base case scenario.
Management applies judgement when determining the need for post-model adjustments. As at 30 September 2024, the post-model
adjustments amounted to DKK 6.4 billion (31 December 2023: DKK 6.7 billion) which are predominantly linked to macroeconomic uncertainties
related to inflation and increasing interest rates, and other sector-specific factors that ensure prudent coverage of expected credit losses for
the Group’s credit exposures. On the types of risks covered by post-model adjustments, more information can be found in note G14.
Note G15 of the Annual Report 2023 and the section on credit risk in note G14 in the Interim report – first nine months 2024 provide more
details on expected credit losses. As at 30 September 2024, financial assets covered by the expected credit loss model accounted for about
54.8% of total assets (31 December 2023: 54.8%).
Fair value measurement of financial instruments
At the end of September 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 include only unlisted shares, certain bonds and some long-dated derivatives for which there is no active market. On the
derivatives portfolio, the Group makes fair value adjustments to cover changes in counterparty risk (CVA) and to cover expected funding costs
(FVA and ColVA) on derivatives, bid-offer spreads on the net open position of the portfolio of assets and liabilities with offsetting market risk
recognised at mid-market prices, and model risk on level 3 derivatives. As at 30 September 2024, the adjustments totalled DKK 0.4 billion (31
December 2023: DKK 0.4 billion), including the adjustment for credit risk on derivatives that are credit impaired. Note G13 of this report and
note G33(a) of the Annual Report 2023 provides more details on the fair value measurement of financial instruments.
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G1. Material accounting policies and estimates - continued
Measurement of goodwill
Goodwill is tested for impairment once a year or more frequently if indications of impairment exist. Impairment testing requires management
to estimate the present value of future cash flows. A number of factors affect the value of such cash flows, including discount rates, changes in
the economic outlook, customer behaviour and competition. At 30 September 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 market value of assets
under management, major restructurings, macroeconomic developments etc. No indications of impairment have been noted at the end of
September 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 assumptions.
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 future
cash flows for insurance 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 mortality rates and
disability rates. Mortality rates are based on the Danish FSA’s benchmark, whilst others are estimated based on data from the Group’s own
portfolio of insurance contracts.
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 based on European Insurance and
Occupational Pension Authority (EIOPA) discount yield curve, which can be found at eiopa.europa.eu/tools-and-data/risk-free-interest-rate-
term-structures_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
measured using GMM.
For health and accident insurance contracts, the loss element includes expectations about mortality, reactivation, reinstatement 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 actuarial 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.
33
Danske Bank / Interim report – first nine months 2024
G2. Changes in accounting policies, Financial highlights
and segment reporting
(a) Changes in accounting policies
With effect from 1 January 2024, the Group has changed the presentation in the IFRS Income statement in relation to income and expenses in
Markets, Operating leases and margins on customer transactions in foreign currencies. At the same time, the Group’s Financial highlights have
been changed to align them with the IFRS financial statements. See note G2(b) for changes in the Financial highlights. The changes in
presentation have been applied retrospectively, resulting in reclassifications between lines in the 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 having 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
presented as Net trading income, except any fixed income from customer transactions (presented as interest income 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) outside 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
income 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 income to Fee
income, because it is a fee in substance. This income in 2023 has been reclassified.
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G2. Changes in accounting policies, Financial highlights
and segment reporting - continued
The tables below shows the impact of the alignment on the IFRS income statement for the first nine months 2024 and full-year 2023.
Q1-Q3 2024
Markets and
Group Treasury
Operating
leases
Margins on
customer
transactions
in foreign
currencies
Restated
Q1-Q3 2023
(DKK millions)
Full year 2023
Markets and
Group Treasury
Operating
leases
43,553
13,812
33,420
23,945
11,737
3,236
8,501
4,954
4,198
3,551
9,193
-8,949
31
922
-590
3,399
2,809
41,131
21,390
19,741
294
19,447
3,950
15,497
-809
-1,443
-4,159
1,907
-52
-218
165
-2,071
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-2,537
-2,537
-2,537
-2,537
-
-
-
-
-
-
-
-
756
-
756
-756
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
42,744
Interest income calculated using the effective interest method
12,369
Other interest income
29,261
Interest expense
25,852
Net interest income from banking activities
12,440
Fee income
3,018
Fee expenses
9,422
Net fee income
2,127
Net trading income or loss
4,198
3,551
9,193
Insurance revenue
Insurance service expenses
Net return on investments backing insurance liabilities
-8,949
Net finance income or expense from insurance
31
922
Other insurance related income
Net insurance result
-590
Gain or loss on sale of disposal groups
862
272
Other income
Total other income
38,595
Total income
18,853
Operating expenses
19,741
Profit before loan impairment charges
294
Loan impairment charges
19,447
Profit before tax
3,950
Tax
15,497
Net profit
60,842
18,752
47,325
32,269
16,111
4,481
11,630
6,590
5,735
5,094
35,228
-34,613
216
1,472
-555
4,446
3,891
55,852
28,908
26,944
262
26,682
5,420
21,262
-1,073
-2,465
-6,241
2,704
-52
-278
225
-2,928
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-3,431
-3,431
-3,431
-3,431
-
-
-
-
-
Margins on
customer
transactions
in foreign
currencies
Restated Full
year 2023
-
-
-
-
1,049
-
1,049
-1,049
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
59,770
16,287
41,085
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
(DKK millions)
Interest income calculated using the effective interest method
Other interest income
Interest expense
Net interest income from banking activities
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
Total other income
Total income
Operating expenses
Profit before loan impairment charges
Loan impairment charges
Profit before tax
Tax
Net profit
34
Danske Bank / Interim report – first nine months 2024
G3. Business segments
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, as presented in the tables
on the following page.
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G2. Changes in accounting policies, Financial highlights
and segment reporting - continued
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.
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
arrangements 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
period affect the classification of a liability.
The second amendment clarifies that only covenants with which an entity must comply on or before the reporting date affect the classification
of the liability as current or non-current. In addition, an entity must disclose information in the notes that enables users of the financial
statements to understand 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 require 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 with 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.
The presentation in the Financial highlights’ balance sheet of loans and deposits that are reported in the IFRS Balance sheet as Assets held
for sale and Liabilities in disposal groups held for sale has been changed to be presented within Other assets and Other liabilities
respectively.
Various minor adjustments to align with IFRS reporting.
•
•
The change in presentation of fixed margin on customer transactions in foreign currencies described in note G2(a) has also been applied to the
Financial highlights, and reclassifies an amount of DKK 756 million from Net trading income to Fee income for the first nine months 2023.
35
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Business segments first nine months 2024
Business segments first nine months 2023
(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
Personal
Customers
Business
Customers
Large
Corporates &
Institutions
Danica
Northern
Ireland
Group
Functions
Eliminations
Total
(DKK millions)
Personal
Customers*
Business
Customers*
Large
Corporates &
Institutions*
Danica
10,704
3,589
118
-
75
8,682
1,680
17
-
521
5,212
4,964
1,884
-
1
-
-
-
1,407
-
14,485
10,900
12,061
1,407
7,242
113
7,243
-232
7,475
3,949
170
6,951
265
6,686
5,435
345
6,626
-403
7,029
-
-
1,407
1,444
-
-62
1,407
1,506
2,211
238
129
-
8
2,585
1,141
-
787
-226
63
-
1,796
2,420
3,159
54
-739
-5
-735
-145
160
-101
-
-1,936
-2,023
-1,882
27,452
Net interest income
10,403
Net fee income
2,110
Net trading income
1,407
Net income from insurance business**
464
Other income***
41,836
Total income
19,046
Operating expenses
-
682
of which resolution fund, bank tax etc.
-141
22,790
Profit before loan impairment charges
-
-436
Loan impairment charges
-141
23,227
Profit before tax
10,686
3,116
160
-
-627
8,605
1,608
37
-
796
5,140
4,497
2,115
-
12
13,335
11,045
11,763
6,835
127
6,500
333
6,167
3,708
191
7,337
246
7,091
5,273
368
6,491
-163
6,653
-
-
-
922
-
922
-
-
922
-
922
Northern
Ireland
1,888
248
198
-
13
2,346
995
-
1,351
-119
1,469
Group
Functions* Eliminations*
-336
-186
-363
-
2,194
1,308
4,106
54
-2,798
-4
-2,794
-131
140
-19
-
-2,116
-2,125
-2,064
-
-61
-
-61
Total*
25,852
9,422
2,127
922
272
38,595
18,853
741
19,741
294
19,447
Loans, excluding reverse transactions
659,195
654,451
295,645
-
63,250
16,420
-17,744
1,671,217
Loans, excluding reverse transactions
641,982
630,455
296,855
-
58,608
27,244
-28,025
1,627,119
Other assets
Total assets
475,387
173,596
2,890,655
573,738
66,120
5,350,594
-7,457,865
2,072,225
Other assets
465,183
189,239
3,807,369
551,834
65,479
4,508,236
-7,385,261
2,202,080
1,134,583
828,047
3,186,299
573,738
129,370
5,367,014
-7,475,609
3,743,442
Total assets
1,107,165
819,693
4,104,224
551,834
124,087
4,535,481
-7,413,286
3,829,199
Deposits, excluding repo deposits
389,057
244,904
330,703
-
106,712
7,520
-14,489
1,064,407
Deposits, excluding repo deposits
376,434
264,033
362,049
-
97,696
3,572
-9,934
1,093,850
Other liabilities
Allocated capital
715,484
540,634
2,815,520
573,738
15,772
5,302,091
-7,461,121
2,502,120
Other liabilities
701,820
516,339
3,701,948
551,834
20,817
4,477,301
-7,403,352
2,566,707
30,042
42,509
40,076
-
6,886
57,402
-
176,916
Allocated capital
28,912
39,321
40,227
-
5,574
54,607
-
168,642
Total liabilities and equity
1,134,583
828,047
3,186,299
573,738
129,370
5,367,014
-7,475,609
3,743,442
Total liabilities and equity
1,107,165
819,693
4,104,224
551,834
124,087
4,535,481
-7,413,286
3,829,199
Profit before tax as % p.a. of allocated capital
(avg.)
Cost/income ratio (%)
Full-time-equivalent staff, end of period
32.6
50.0
3,976
21.2
36.2
1,728
23.2
45.1
2,115
9.3
-
920
31.4
44.1
-2.3
-
1,248
10,069
-
-
-
17.6
45.5
Profit before tax as % p.a. of allocated capital
(avg.)
Cost/income ratio (%)
27.9
51.3
24.0
33.6
20,057
Full-time-equivalent staff, end of period
4,179
1,652
22.0
44.8
2,098
6.3
-
905
30.3
42.4
-10.5
-
1,261
10,001
-
-
-
15.8
48.8
20,097
* Net income from insurance business in the Financial highlights and Business segments is equivalent to Net insurance result in the IFRS financial statements.
** Other income in the Financial highlights and Business segments is equivalent to Total other income in the IFRS financial statements.
* Comparative information has been restated, as described in note G2(b).
** Net income from insurance business in the Financial highlights and Business segments is equivalent to Net insurance result in the IFRS financial statements.
*** Other income in the Financial highlights and Business segments is equivalent to Total other income in the IFRS financial statements.
36
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G4. Income
G5. Loan impairment charges and reconciliation of total allowance account
(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.
Loan impairment charges include impairment charges for expected credit losses on loans, lease receivables, bonds at amortised cost and fair
value through other comprehensive income, certain loan commitments and financial guarantee contracts as well as fair value adjustments of
the credit risk on loans measured at fair value.
Fee income first nine months 2024
(DKK millions)
Investment
Money transfers, account fee, cash management and other fees
Lending and Guarantees
Capital markets
Total
Fee income first nine months 2023
(DKK millions)
Investment
Money transfers, account fee, cash management and other fees
Lending and Guarantees
Capital markets
Total
Fee income
Fee expenses
Net fee income
6,212
4,719
1,632
1,154
2,593
576
110
36
3,620
4,144
1,522
1,118
Loan impairment charges
(DKK millions)
ECL on new assets
ECL on assets derecognised
Impact of net remeasurement of ECL (incl. changes in models)
13,718
3,315
10,403
Write-offs charged directly to income statement
Received on claims previously written off
Interest income, effective interest method
Total
Fee income*
Fee expenses* Net fee income*
5,328
4,381
1,692
1,039
2,179
674
101
64
12,440
3,018
3,149
3,707
1,592
975
9,422
* Comparative information has been restated, as described in note G2(a) and G2(b).
(b) Gain or loss on sale of disposal groups
Gain or loss on sale of disposal groups amounted to DKK 41 million for the nine months ending 30 September 2024, compared to a loss of DKK
590 million in the same period in 2023, which included the expected costs directly attributable to the sale of the personal customers business
in Norway, as announced in July 2023.
(c) Other income
Other income amounted to DKK 423 million for the nine months ending 30 September 2024 (30 September 2023: DKK 862 million). Other
income includes income from investment property and real estate brokerage, and income from holdings in associates.
37
Danske Bank / Interim report – first nine months 2024
30 September
2024
30 September
2023
2,617
-2,228
89
97
-713
-298
-436
2,201
-2,160
682
467
-676
-220
294
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G5. Loan impairment charges and reconciliation
of total allowance account - continued
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
Stage 1
Stage 2
Stage 3
Total
3,273
2,023
-198
-19
492
-391
8,082
-1,924
487
-355
843
-957
Impact of net remeasurement of ECL (incl. changes in models)
-1,781
1,779
Write-offs debited to the allowance account
Foreign exchange adjustments
Other changes
ECL allowance account as at 30 September 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
-2
-29
-1
3,366
3,592
984
-243
-22
452
-400
-695
-9
-15
1
-
-85
-1
7,868
7,486
-894
516
-343
1,285
-1,175
713
-
-63
-11
ECL allowance account as at 30 September 2024
3,645
7,512
9,068
20,225
The movements on the allowance account are determined by comparing the classification and amount in the balance sheet at the beginning
and the end of the period. For further information on the decomposition of the allowance account on facilities in stages 1-3 under
IFRS 9, see note G14.
38
Danske Bank / Interim report – first nine months 2024
8,290
19,645
-99
-289
374
867
-811
685
-318
-37
12
8,673
9,062
-90
-273
364
880
-652
71
-267
-23
-6
-
-
-
2,201
-2,160
682
-320
-152
11
19,907
20,140
-
-
-
2,617
-2,228
89
-276
-101
-16
G6. Insurance assets and Insurance liabilities
Insurance assets comprise assets earmarked for policyholders. As at 30 September 2024, Insurance asset totals DKK 546,753 million (31
December 2023: DKK 518,555 million) before own bonds of DKK 5,210 million (31 December 2023: DKK 5,984 million) and other intra-group
balances of DKK 15,036 million (31 December 2023: DKK 16,540 million).
Insurance liabilities comprise DKK 448,828 million of Liabilities under insurance contracts as defined by IFRS 17 (31 December 2023:
DKK 415,414 million) and DKK 74,023 million of Other insurance-related liabilities (31 December 2023: DKK 78,130 million), before intra-group
balances of DKK 9,594 million (31 December 2023: DKK 10,914 million).
Note G18 of Annual Report 2023 provides additional information on Insurance assets and Insurance liabilities.
G7. Issued bonds, subordinated debt and additional tier 1 capital
Issued bonds at fair value
(DKK millions)
Bonds issued by Realkredit Danmark (covered bonds)
Commercial papers and certificates of deposits
Structured retail notes
Total
Issued bonds at amortised cost and non-preferred senior bonds
(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
30 September
31 December
2024
2023
749,028
741,062
275
2,266
5,228
2,489
751,570
748,780
30 September
31 December
2024
53,734
62,502
2023
24,419
63,345
139,385
124,703
833
1,766
256,454
214,234
86,789
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.
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G7. Issued bonds, subordinated debt and additional tier 1 capital -
continued
Other issued bonds
Other issued bonds in the following tables comprises Issued bonds at fair value excluding Realkredit Danmark, Issued bonds at amortised cost
and Non-preferred senior bonds.
Nominal value of other issued bonds
(DKK millions)
Commercial papers and certificate of deposits
Preferred senior bonds
Covered bonds
Structured retail notes
Non-preferred senior bonds
Total
(DKK millions)
Commercial papers and certificate of deposits
Preferred senior bonds*
Covered bonds
Structured retail notes*
Non-preferred senior bonds
Total
1 January
2024
29,613
65,545
129,419
4,076
97,900
326,553
1 January
2023
9,128
52,421
156,740
Foreign currency
30 September
Issued
64,101
6,954
23,800
-
21,670
116,525
Redeemed
translation
45,438
7,139
10,280
1,012
29,321
93,190
5,657
-1,439
-1,195
245
-2,154
1,114
2024
53,934
63,921
141,743
3,309
88,095
351,002
Foreign currency
31 December
Issued
Redeemed**
translation
66,432
39,700
33,000
6,927
-
100,586
325,801
22,500
161,633
36,812
25,430
65,850
2,414
23,700
154,206
-9,135
-1,146
5,529
-437
-1,486
-6,675
2023
29,613
65,545
129,419
4,076
97,900
326,553
Subordinated debt and additional tier 1 capital
As at 30 September 2024, the nominal value of subordinated debt, including liability accounted additional tier 1 capital, amounted to
DKK 37,684 million (31 December 2023: DKK 40,069 million). During the nine months ended 30 September 2024, the Group issued
EUR 750 million of tier 2 capital and SEK 4,250 million of tier 2 capital. The Group also redeemed USD 750 million of liability accounted
additional tier 1 capital and EUR 750 million of tier 2 capital during the nine months ended 30 September 2024. During 2023, the Group did not
issue or redeem any additional tier 1 or tier 2 capital instruments.
For the additional tier 1 capital, Danske Bank A/S may, at its sole discretion, omit interest payments to bondholders. Any interest payments are
paid out of distributable items, which primarily consist of retained earnings in Danske Bank A/S and Danske Bank Group. As at 30 September
2024, distributable items for Danske Bank A/S amounted to DKK 121.8 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 30 September 2024 the common equity
tier 1 capital ratio was 22.2% (31 December 2023: 21.9%) for Danske Bank A/S. The ratios for the Danske Bank Group are disclosed in the
Statement of capital.
G8. 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
30 September
31 December
2024
2023
77,848
250
78,099
26,064
24,707
50,771
110,415
289
110,704
30,599
25,877
56,476
*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.
**Covered bonds redeemed in 2023 include DKK 25.9 billion of Covered bonds that were reclassified to Liabilities in disposal groups held for sale. See note G8 for
more detail.
In the table above, loans and deposits consist 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 estate agent within 12 months
from the date of acquisition. The properties are primarily in Denmark.
39
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G9. Other assets and Other liabilities
G10. Foreign currency translation reserve
(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
As at 30 September 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 33,182 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 on capital ratios resulting from
changes in the risk exposure amount due to changes in currency rates. The Group’s net investment in its subsidiaries Danske Hypotek AB
(Sweden) and Danske Mortgage Bank Plc (Finland) is included in the structural FX hedge position to extend the hedge to the risk exposure
amount measured by currency for EUR, NOK and SEK across the entire Group balance sheet, although with constraints to the size of the loans
to the foreign branches and the net investments in the foreign subsidiaries. This strategy of partly hedging the sensitivity to capital ratios from
volatility in foreign currency rates, increases the volatility in Other comprehensive income and the Foreign currency translation reserve in
equity under IFRS since it decreases the hedge of the currency risk on the net investments in those units. As at 30 September 2024, the
structural FX hedge position totalled DKK 37,257 million (31 December 2023: DKK 37,641 million) and a loss of DKK 632 million has been
recognised in Other comprehensive income during the first nine months of 2024, primarily due to a weakening of SEK and NOK against DKK
throughout the first nine months of 2024. For comparison, a total loss of DKK 1,397 million was recognised in Other comprehensive income
during the first nine months of 2023, of which DKK 611 million was primarily due to a weakening of SEK against DKK. The remaining loss of DKK
786 million in 2023 was realised and reclassified to Other comprehensive income to the Income statement due to the adjustment made for the
structural FX hedge position held in NOK, to reflect the reduction in long term risk exposure amount (REA) in NOK coming from the announced
sale of personal customer business in Norway.
30 September
31 December
2024
2023
8,837
12,843
922
377
7,221
3,767
529
7,264
10,811
806
157
7,418
4,010
612
34,496
31,079
42,161
18,908
462
1,152
3,868
3,110
2
1,968
71,632
33,005
12,902
301
1,175
4,102
3,161
2
2,398
57,046
In the table above, Provisions, including litigations includes customer remediation of DKK 1,365 million, regulatory and legal proceedings of
DKK 4 million, restructuring costs of DKK 209 million and other provisions of DKK 390 million.
40
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G11. Guarantees, commitments and contingent liabilities
Contingent liabilities consist of possible liabilities arising from past events. The existence of such liabilities will be confirmed only by the
occurrence or non-occurrence of one or more uncertain future events not wholly within the Group’s control. Contingent liabilities that can, but
are not likely to, result in an outflow of economic resources are disclosed.
The Group uses a variety of loan related financial instruments to meet customers’ financial requirements. Instruments include loan offers and
other credit facilities, guarantees and instruments not recognised in the balance sheet. If an instrument is likely to result in a payment
obligation, a liability is recognised under Other liabilities corresponding to the present value of expected payments.
(a) Guarantees
(DKK millions)
Financial guarantees
Other guarantees
Total
(b) Commitments
(DKK millions)
Loan commitments shorter than 1 year
Loan commitments longer than 1 year
Other unutilised commitments
Total
30 September
31 December
2024
17,380
75,561
92,941
2023
4,348
71,536
75,883
30 September
31 December
2024
220,806
233,062
16,705
470,573
2023
197,007
220,285
16,719
434,011
As part of the Bank’s agreement with DoJ, Danske Bank was placed on corporate probation for three years from 13 December 2022 until
13 December 2025 and Danske Bank committed to continue improving its compliance programs. Danske Bank has taken extensive
remediation action to address those failings to prevent any similar occurrences, and the Bank remains in contact with DoJ as a matter of post-
resolution obligations set forth in the agreement with DoJ.
The Bank has been subject to a criminal investigation by authorities in France. The Bank has cooperated with the French authorities and has
reached a resolution with the French National Financial Prosecutor to settle this investigation by agreeing to pay EUR 6.33 million. As
previously communicated, the coordinated resolutions reached with the US and Danish authorities in December 2022 did not include the
French investigation. The resolution marks the end of the French investigation of Danske Bank. Danske Bank had posted bail in the amount of
DKK 80 million in connection with the French investigation, and the financial impact of this resolution was previously provisioned for.
The civil claims filed against Danske Bank by institutional investors can be summarised to six case complexes with a current total claim
amount of approximately DKK 12.8 billion. One of the case complexes has partly been referred to the Eastern High Court, while the remaining
case complexes are stayed or pending before the Copenhagen City Court. The civil claims were not included in the coordinated resolutions with
DoJ, SEC, and SCU. Danske Bank will continue to defend itself vigorously against these claims. The timing of completion of such civil claims
(pending or threatening) and their outcome are uncertain and could be material.
Danske Bank has been procedurally notified in two claims filed against Thomas F. Borgen. Under Danish law, the purpose of a procedural
notification is to make a formal reservation of rights to bring a potential claim against the notified party. The first case was dismissed in the
first instance and subsequently appealed by the claimants. The original claim amount for both claims was approximately DKK 3.2 billion but
has been reduced to approximately DKK 1.7 billion.
An action has been filed in the United States District Court for the Eastern District of New York against Danske Bank and others. The complaint
sought unspecified punitive and compensatory damages. On 29 December 2022, the action was dismissed by the court and on 27 January
2023, the complainants filed an appeal of the dismissal. The timing of the completion of the lawsuit and the outcome are uncertain.
Other
Owing to its business volume, Danske Bank is continually a party to various other lawsuits and disputes, and has an ongoing dialogue with
public authorities, such as the Danish FSA and the Danish Tax Agency on other matters. In general, Danske Bank does not expect the outcomes
of any of these other pending lawsuits and disputes, or its dialogue with public authorities to have any material effect on its financial position.
Provisions for litigations are included in Other liabilities, see note G9.
In addition to credit exposure from lending activities, loan offers made and uncommitted lines of credit granted by the Group amounted to
DKK 161 billion (31 December 2023: DKK 232 billion). These items are included in the calculation of the total risk exposure amount in
accordance with the CRR.
(d) Further explanation
A limited number of employees are employed under terms which, if they are dismissed before reaching their normal retirement age, grant
them a severance and/or pension payment in excess of their entitlement under ordinary terms of employment. As the sponsoring employer,
the Group is also liable for the pension obligations of a number of company pension funds.
(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 Securities and
Exchange Commission (SEC) and the Danish Special Crime Unit (SCU) following the investigations into failings and misconduct related to the
non-resident portfolio at Danske Bank’s former Estonia branch. The aggregate amounts payable to the US and Danish authorities were paid in
January 2023. The coordinated resolutions marked the end of the criminal and regulatory investigations into Danske Bank by the authorities in
Denmark and the United States.
The Group participates in the Danish Guarantee Fund and the Danish Resolution Fund. The funds’ capital must amount to at least 0.8% and 1%,
respectively, of the covered deposits of all Danish credit institutions by 31 December 2023.
The Danish Guarantee Fund is currently fully funded, but if the fund subsequently does not have sufficient means to make the required
payments, extraordinary contributions of up to 0.5% of the individual institution’s covered deposits may be required. Extraordinary
contributions above this percentage require the consent of the Danish FSA.
41
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G11. Guarantees, commitments and contingent liabilities - continued
Danske Bank A/S and Realkredit Danmark A/S make contributions to the Danish Resolution Fund based on their size and risk relative to other
credit institutions in Denmark. The contribution to the Resolution Fund is recognised as operating expenses. After payment of the contribution
for 2024, the Resolution Fund is fully funded. If the Resolution Fund does not have sufficient means to make the required payments,
extraordinary contributions of up to three times the latest annual contributions may be required.
In addition, Danish banks participate in the Danish Restructuring Fund, which reimburses creditors if the final dividend is lower than the interim
dividend in respect of banks that were in distress before 1 June 2015. Similarly, Danish banks have made payment commitments totalling
DKK 1 billion to cover losses incurred by the Danish Restructuring Fund for the withdrawal of distressed banks from data centres etc. Payments
to the Danish Restructuring Fund are calculated based on the individual credit institution’s share of covered deposits relative to other credit
institutions in Denmark. However, each institution’s contribution to the Danish Restructuring Fund may not exceed 0.2% of its covered
deposits.
The Group is a member of deposit guarantee schemes and other compensation schemes in Norway and the UK. As in Denmark, the
contributions to the schemes in these countries are annual contributions combined with extraordinary contributions if the means of the
schemes are not sufficient to cover the required payments.
Danske Bank A/S is taxed jointly with all Danish entities of Danske Bank Group and is jointly and severally liable with these for payment of
Danish corporation tax and withholding tax, etc.
42
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G12. Assets provided or received as collateral
Securities provided as collateral under agreements that entitle the counterparty to sell the securities or provide them as collateral for other
loans amounted to DKK 167.2 billion as at 30 September 2024 (31 December 2023: DKK 164.2 billion).
As at 30 September 2024, the Group had deposited securities (including bonds issued by the Group) worth DKK 4.4 billion as collateral with
Danish and international clearing centres and other institutions (31 December 2023: DKK 4.5 billion).
As at 30 September 2024, the Group had provided cash and securities (including bonds issued by the Group) worth DKK 81.1 billion as collateral
for derivatives transactions (31 December 2023: DKK 90.6 billion).
As at 30 September 2024, the Group had received securities worth DKK 382.0 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 30 September 2024, the
Group had sold securities or provided securities as collateral worth DKK 119.5 billion (31 December 2023: DKK 113.6 billion).
As at 30 September 2024, the Group had registered insurance assets (including bonds and shares issued by the Group) and investment
contracts worth DKK 493.8 billion (31 December 2023: DKK 443.2 billion) as collateral for policyholders’ savings of DKK 461.3 billion (31
December 2023: DKK 426.0 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 ownership of these assets. Note G40 of the Annual Report 2023 provide more details on assets received as collateral in connection with
ordinary lending activities.
As at 30 September 2024, the Group had registered loans at fair value and securities (including bonds issued by the Group) worth a total of
DKK 764.3 billion (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 271.4 billion (31 December 2023: DKK 308.8 billion) as collateral for covered bonds issued under
Danish, Finnish and Swedish law.
The table below shows assets provided as collateral for liabilities or contingent liabilities. Assets provided as collateral under repo transactions
are shown separately whereas the types explained above are included in the column ‘Other’.
Assets provided as collateral
(DKK millions)
Due from credit institutions
Trading and investment securities
Loans at fair value
Loans at amortised cost
Insurance assets and assets under investment contracts
Total
Own issued bonds
30 September 2024
31 December 2023
Repo
Other
Total
Repo
Other
Total
-
25,722
25,722
-
15,922
15,922
167,183
57,947
225,130
164,189
48,326
212,514
-
-
-
758,200
758,200
280,906
280,906
473,589
473,589
-
-
-
753,277
753,277
340,297
340,297
420,701
420,701
167,183
1,596,365
1,763,548
164,189
1,578,522
1,742,711
33,558
23,344
56,901
33,693
30,665
64,358
Total, including own issued bonds
200,741
1,619,708
1,820,449
197,882
1,609,187
1,807,069
43
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G13. Fair value information for financial instruments
Financial instruments are recognised in the balance sheet at fair value or amortised cost.
Insurance liabilities in the Balance sheet comprises Liabilities under insurance contracts (as defined by IFRS 17) and Other insurance-related
liabilities. The table above does not include Liabilities under insurance contracts as they are measured using the General Measurement Model,
Variable Fee Approach or Premium Allocation Approach as defined by IFRS 17.
(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
Insurance liabilities*
Liabilities held for sale
Non-preferred senior bonds
Subordinated debt
Loan commitments and guarantees
Total
30 September 2024
31 December 2023*
Fair value
Amortised cost
Fair value
Amortised cost
Investment securities at fair value includes bonds measured at fair value through other comprehensive income, see the table on bonds in note
G14. All other financial assets in the column ‘Fair value’ are mandatorily measured at fair value through profit or loss under IFRS 9. Except for
trading portfolio liabilities, all other financial liabilities at fair value are measured at fair value through profit or loss using the fair value option.
-
112,311
514,297
167,989
55,663
-
-
92,985
548,189
259,156
21,829
-
-
140,978
-
155,398
125,278
-
128,516
-
-
915,451
-
918,628
980,599
75,477
487,983
-
-
-
928,239
70,900
460,747
-
-
-
-
77,848
-
110,415
2,295,945
1,357,929
2,229,576
1,465,425
101,688
368,185
87,198
-
85,548
454,487
69,060
-
99,797
1,063,918
120,213
1,101,990
751,570
-
748,780
-
-
256,454
-
214,234
76,467
55,188
-
-
-
-
-
-
50,771
86,789
37,059
3,110
71,253
60,136
-
-
-
-
-
-
56,476
93,194
38,774
3,161
1,452,894
1,585,299
1,540,417
1,576,889
Financial instruments at amortised cost
The liquidity portfolio managed by Group Treasury includes different portfolios with different business models (see note G13 in Annual Report
2023 for further description of business models). Bonds held within a business model for the purpose of collecting contractual cash flows (hold
to collect) and with cash flows that are solely payments of principal and interest on the principal amount outstanding are measured at
amortised cost. For bonds classified as hold-to-collect, amortised cost exceeded fair value as of 30 September 2024 with DKK 3,669 million (31
December 2023: DKK 6,489 million). This portfolio mainly contains Danish mortgage bonds and central and local government bonds and has a
weighted average rating factor of 4.2, following Moody’s numerical rating factor to scale, which corresponds to a strong Aa1 rating. The
interest rate risk duration for the portfolio is 2.9 years. Without any reinvestments, respectively 33%, 46% and 21% 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 has reduced
significantly during the third quarter of 2024 due to a decrease in market interest rate levels. The difference is now less than 3% of the amount
invested and held at amortised cost. Note G33 in Annual Report 2023 provides information on the difference between the carrying amount and
the fair value of financial instruments recognised at amortised cost.
Financial instruments at fair value
Note G33(a) of the Annual Report 2023 provides more information about fair value calculation methods for financial instruments.
Financial instruments valued on the basis of quoted prices in an active market are recognised in the Quoted prices category. Financial
instruments valued substantially on the basis of other observable input are recognised in the Observable input category. This category covers
instruments such as derivatives valued on the basis of observable yield curves and exchange rates and illiquid mortgage bonds valued by
reference to the value of similar, liquid bonds. Other financial instruments valued substantially on the basis of non-observable input are
recognised in the Non-observable input category. This category covers instruments such as unlisted shares, some unlisted bonds and a very
limited portion of the derivatives portfolio.
If, at the balance sheet date, a financial instrument’s classification differs from its classification at the beginning of the year, the classification
of the instrument changes. Changes are considered to have taken place at the balance sheet date. Developments in the financial markets have
resulted in reclassification between the categories. Some bonds have become illiquid and have therefore been moved from the Quoted prices
to the Observable input category, while other bonds have become liquid and have been moved from the Observable input to the Quoted prices
category. The amounts transferred are insignificant.
* The table above has been restated to include Insurance liabilities as at 31 December 2023 which meet the definition of financial instruments.
44
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G13. Fair value information for financial instruments – continued
Financial instruments at fair value
(DKK millions)
30 September 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
Total
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
Insurance Liabilities
Total
45
Danske Bank / Interim report – first nine months 2024
Quoted prices Observable input
Non-observable
input
Total
(DKK millions)
31 December 2023
Financial assets
-
10,220
158,792
56,139
102,689
-
-
75,477
169,203
192,642
946
112,311
264,198
22,275
-
22,089
-
980,599
-
40,386
5,654
40,119
-
112,311
Due from credit institutions and central banks
2,510
276,928
Derivatives
-
162
-
500
-
-
3,211
35,124
698
181,067
Trading portfolio bonds
56,301
Trading portfolio shares
124,778
Investment securities, bonds
500
Investment securities, shares
980,599
Loans at fair value
75,477
Assets under pooled schemes and investment contracts
212,800
Insurance assets, bonds
233,420
Insurance assets, shares
41,763
Insurance assets, derivatives
Quoted prices Observable input
Non-observable
input
Total
-
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
92,985
351,722
177,563
18,904
128,023
493
928,239
70,900
214,073
193,186
53,488
766,108
1,487,631
42,205
2,295,945
Total
707,741
1,481,235
40,601
2,229,576
-
11,458
117,084
-
751,570
-
467
101,688
234,750
2,366
99,797
-
76,467
54,176
880,579
569,244
Financial liabilities
-
101,688
Due to credit institutions and central banks
2,527
248,735
Derivatives
-
-
-
-
544
3,071
119,450
Obligations to repurchase securities
99,797
Deposits
751,570
Issued bonds at fair value
76,467
Deposits under pooled schemes and investment contracts
55,187
Insurance liabilities*
1,452,894
Total
-
7,360
111,657
85,548
331,954
1,853
-
120,213
748,780
-
-
-
71,253
58,976
867,797
669,797
-
1,604
59
-
-
-
1,160
2,823
85,548
340,918
113,569
120,213
748,780
71,253
60,136
1,540,417
* The table above has been restated to include Insurance liabilities as at 31 December 2023 which meet the definition of financial instruments.
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G13. Fair value information for financial instruments – continued
Financial instruments in level 3 (Unobservable inputs)
Financial instruments valued on the basis of unobservable inputs
Reconciliation from beginning to end of period
Sensitivity (change in fair value)
Gains/losses for the period
30 September 2024
31 December 2023
Carrying amount
Increase
Decrease
Realised
Unrealised
(DKK millions)
Bonds
Derivatives
Bonds
Derivatives
(DKK millions)
30 September 2024
Unlisted shares allocated to insurance contract policyholders
Unlisted shares other
Illiquid bonds
Derivatives, net fair value
31 December 2023*
Unlisted shares allocated to insurance contract policyholders
Unlisted shares other
Illiquid bonds
Derivatives, net fair value
1,642
-1,203
Value adjustment through profit or loss
Fair value at 1 January
10
Acquisitions
Sale and redemption
Transferred from quoted prices and observable input
Transferred to quoted prices and observable input
35,124
662
3,211
137
34,755
553
2,458
12
-
66
64
-
-
55
56
-
-
66
64
-
-
55
56
-
85
-
-
522
302
2
-
-221
301
-522
-160
-152
1,102
Shares
35,308
534
9,370
-9,426
-
-
2,458
-221
271
-18
721
-
Shares
48,292
142
3,152
-16,278
-
-
12
301
-82
-35
-
-58
137
3,369
-150
161
-922
-
-
-1,084
1,102
-250
-125
295
74
12
Fair value end of period
35,786
3,211
35,308
2,458
The value adjustment through profit or loss is recognised under Net trading income or loss. The transfer of derivatives to the Observable input
category consists primarily of maturity reductions, implying that the yield curves have become observable.
* The table above has been restated to include Insurance liabilities as at 31 December 2023 which meet the definition of financial instruments.
For unlisted shares allocated to insurance contract policyholders, the policyholders assume most of the risk on the shares. Therefore, changes
in the fair value of those shares will only to a limited extent affect the Group’s net profit. The Group’s remaining portfolio of unlisted shares
consists primarily of banking-related investments and holdings in private equity funds. The sensitivity of the fair value measurement to
changes in the unobservable input disclosed in the table is calculated as a 10% increase or 10% decrease in fair value. Under current market
conditions, a 10% decrease in the fair value is considered to be below a possible alternative estimate of the fair value at the end of the period.
The unrealised adjustments in the nine months ended 30 September 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 sensitivity of the fair value
measurement to changes in non-observable input is calculated as a 50bps widening or narrowing of the credit spread.
A substantial number of derivatives valued on the basis of non-observable input are hedged by similar derivatives or are used for hedging the
credit risk on bonds also valued on the basis of non-observable input. Changing one or more of the non-observable inputs to reflect reasonable,
possible alternative assumptions would not change the fair value of the derivatives significantly above what is already covered by the reserve
related to fair value adjustment for model risk.
46
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
G14. Risk management notes
The consolidated financial statements for 2023 provide a detailed description of the Group’s risk management practices.
Breakdown of credit exposure
(DKK billions)
30 September 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
Total Lending activities
Counterparty
credit risk
Trading and
investment
securities
Customer-funded
investments
161.1
168.0
514.3
266.3
915.5
980.6
75.5
526.5
77.8
92.9
220.8
233.1
16.7
161.1
55.7
-
-
915.5
758.2
-
-
77.8
92.9
220.8
233.1
-
-
112.3
276.9
-
-
222.4
-
-
-
-
-
-
-
-
-
237.4
266.3
-
-
-
-
-
-
-
-
-
4,249.1
2,515.1
611.6
503.7
-
-
-
-
-
-
75.5
526.5
-
-
-
-
16.7
618.7
(DKK billions)
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
Total
Total Lending activities
Counterparty
credit risk
Trading and
investment
securities
Customer-funded
investments
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
-
-
-
-
-
-
-
4,233.8
2,550.1
619.7
-
-
196.5
283.9
-
-
-
-
-
-
-
-
-
-
-
-
-
-
70.9
496.0
-
-
-
-
0.1
480.5
16.6
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 161 billion at 30 September 2024 (31 December 2023: DKK 232 billion). These items are included in the calculation of the total risk
exposure amount in accordance with the Capital Requirements Directive.
47
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Credit exposure
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,
guarantees and irrevocable loan commitments. The exposure is measured net of expected credit losses and includes repo loans at amortised
cost. For reporting purposes, all collateral values are net of haircuts and capped at the exposure amount.
The Group’s definition of default for accounting aligns with the regulatory purposes. All exposures in stage 3 are considered default. This
includes all non-performing loans. A small amount of credit exposure in stage 3 can be found outside default. This is due to impairment staging
being updated monthly (after each month-end), whereas default is updated daily. For the same reason, some credit exposure in default is
outside stage 3. The stage 3 coverage ratio is 73 % (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.
48
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Credit exposure – continued
Credit exposure broken down by rating categories
(DKK billions)
30 September 2024
PD level
Gross exposure
Expected credit loss
Net exposure
Net exposure, ex collateral
Upper
Lower
Stage 1
Stage 2
Stage 3
Stage 1
Stage 2
Stage 3
Stage 1
Stage 2
Stage 3
Stage 1
Stage 2
Stage 3
1
2
3
4
5
6
7
8
9
10
11 (default)
Total
(DKK billions)
31 December 2023*
1
2
3
4
5
6
7
8
9
10
11 (default)
Total
-
0.01
0.03
0.06
0.14
0.31
0.63
1.90
7.98
25.70
100.00
0.01
0.03
0.06
0.14
0.31
0.63
1.90
7.98
25.70
99.99
100.00
98.0
271.0
554.3
613.8
432.0
284.7
90.3
12.3
0.9
0.5
0.8
0.1
0.3
2.2
2.5
6.9
37.8
42.0
27.6
4.7
19.6
1.4
2,358.7
145.0
-
-
-
-
0.1
-
0.1
0.1
-
1.8
29.5
31.7
-
-
0.1
0.2
0.4
0.6
1.2
0.8
-
-
0.3
3.6
-
-
-
-
0.1
0.6
1.7
2.3
0.7
2.0
-
7.5
-
-
-
-
-
-
0.1
0.1
-
0.3
8.5
9.1
98.0
271.0
554.2
613.6
431.6
284.1
89.1
11.5
0.9
0.5
0.5
0.1
0.3
2.1
2.5
6.8
37.2
40.3
25.3
4.0
17.5
1.4
2,355.0
137.4
-
-
-
-
0.1
-
-
-
-
1.5
21.0
22.6
79.2
160.4
280.0
273.8
147.8
81.4
30.5
3.4
0.1
0.1
-
1,056.7
-
-
1.8
1.5
4.4
16.1
13.6
5.9
1.1
6.6
0.1
51.2
-
-
-
-
-
-
-
-
-
-
3.3
3.3
PD level
Gross exposure
Expected credit loss
Net exposure
Net exposure, ex collateral
Upper
Lower
Stage1
Stage2
Stage3
Stage1
Stage2
Stage3
Stage1
Stage2
Stage3
Stage1
Stage2
Stage3
-
0.01
0.03
0.06
0.14
0.31
0.63
1.90
7.98
25.70
100.00
0.01
0.03
0.06
0.14
0.31
0.63
1.90
7.98
25.70
99.99
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
2,393.3
144.2
-
-
-
-
0.1
0.1
0.1
0.4
-
1.3
30.7
32.7
-
-
0.1
0.2
0.4
0.7
1.2
0.9
-
-
-
3.6
-
-
-
-
-
0.6
1.9
2.8
1.0
1.0
-
7.5
-
-
-
-
-
-
-
-
-
0.5
8.6
9.1
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
2,389.7
136.7
-
-
-
-
0.1
0.1
0.1
0.4
-
0.8
22.1
23.6
108.9
178.3
263.2
274.9
136.5
87.2
27.9
1.7
0.2
0.2
0.4
1,079.4
-
-
0.4
0.5
5.5
18.7
17.7
6.3
1.0
3.7
0.2
54.1
-
-
-
-
-
-
-
0.2
-
0.5
2.2
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.
49
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
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
Classification 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.
Credit exposure broken down by industry
(DKK billions)
30 September 2024
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
Total
Gross exposure
Expected credit loss
Net exposure
Net exposure, ex collateral
Stage 2
Stage 3
Stage 1
Stage 2
Stage 3
Stage 2
Stage 3
Stage 1
230.0
154.5
52.7
24.1
89.4
263.2
42.2
76.0
12.6
16.9
2.8
54.6
197.3
43.6
27.3
68.2
39.0
29.1
23.1
40.2
83.4
1.4
2.8
5.6
3.8
12.0
30.8
8.5
8.3
1.3
2.9
0.4
0.7
3.5
2.8
4.9
9.6
1.5
1.3
1.3
2.5
0.7
0.3
1.1
1.8
0.3
1.0
4.2
1.7
1.2
0.7
-
0.4
-
0.5
0.6
2.0
1.1
1.5
0.3
1.3
1.2
-
-
-
0.3
-
0.3
0.7
0.4
-
-
-
0.1
-
0.1
-
0.1
0.2
-
-
-
-
-
1.2
3.6
-
0.1
0.7
0.2
0.4
1.5
1.0
0.5
-
-
-
-
0.1
0.1
0.4
0.5
0.1
0.1
0.1
0.1
-
1.5
7.5
-
0.2
0.5
0.1
0.5
1.0
0.8
0.4
0.2
-
0.1
-
0.1
0.2
0.6
0.4
0.2
0.1
0.7
0.3
-
2.6
9.1
Stage 1
230.0
154.4
52.3
24.1
89.1
262.5
41.8
76.0
12.6
16.9
2.7
54.6
197.3
43.6
27.3
68.0
39.0
29.1
23.1
40.2
83.3
1.4
2.8
4.9
3.5
11.6
29.2
7.5
7.8
1.3
2.9
0.4
0.7
3.3
2.6
4.5
9.1
1.4
1.3
1.3
2.4
0.7
0.2
0.9
1.3
0.1
0.6
3.2
0.8
0.9
0.5
-
0.2
-
0.4
0.4
1.4
0.7
1.3
0.2
0.6
0.9
-
7.8
22.6
Stage 1
228.0
136.5
12.7
17.9
78.9
38.2
30.3
61.5
3.2
14.2
-
51.3
25.7
31.7
17.2
55.6
22.6
12.4
17.4
32.4
63.5
105.5
1,056.7
Stage 2
Stage 3
-
2.1
1.5
1.7
9.4
4.2
3.7
5.2
0.3
2.2
0.1
0.5
0.4
1.5
3.6
7.6
0.3
0.8
1.1
0.6
0.6
3.7
51.2
-
0.6
-
-
0.2
0.5
0.4
0.2
0.1
-
-
-
-
0.1
0.7
0.3
0.2
-
0.1
-
-
-
3.3
788.6
2,358.7
38.3
145.0
10.4
31.7
787.4
2,355.0
36.8
137.4
*As at 30 September 2024, DKK 143 billion of the net exposure in Commercial property is towards residential assets.
As at 30 September 2024, oil and gas exposures (within the Shipping, oil and gas industry) represent a gross exposure of DKK 19.9 billion (31 December 2023: DKK 18.1 billion) and expected credit losses of DKK 0.1 billion (31 December 2023: DKK 0.3 billion). Those exposures represent the
majority of the exposures in stage 3 within the Shipping, oil and gas industry at the end of September 2024.
50
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Credit exposure – continued
(DKK billions)
31 December 2023*
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
Total
Gross exposure
Expected credit loss
Net exposure
Net exposure, ex collateral
Stage 2
Stage 3
Stage 1
Stage 2
Stage 3
Stage 2
Stage 3
Stage 1
298.6
150.0
54.8
24.9
82.7
258.0
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
1.0
3.4
4.6
2.5
13.3
32.4
6.5
8.3
1.8
1.2
0.3
2.9
4.5
3.7
5.2
7.6
1.9
1.3
0.8
2.1
1.3
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
-
-
0.1
0.3
-
0.1
0.8
0.3
0.1
-
-
0.1
-
0.1
-
0.1
0.2
-
-
-
-
-
1.4
3.6
-
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
7.5
-
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
9.1
Stage 1
298.6
149.9
54.5
24.9
82.6
257.3
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
1.0
3.3
3.9
2.4
13.0
30.6
5.6
7.8
1.8
1.2
0.3
2.9
4.2
3.6
4.9
7.3
1.9
1.2
0.7
2.0
1.3
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
23.6
Stage 1
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
1,079.4
Stage 2
Stage 3
-
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
-
-
-
-
-
-
54.1
3.0
819.0
2,393.3
37.7
144.2
10.2
32.7
817.5
2,389.7
36.1
136.7
* 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.
** As at 31 December 2023, DKK 139 billion of the net exposure in Commercial property is towards residential assets.
51
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Credit exposure – continued
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
September 2024 can be found as the difference between the columns ‘Net exposure’ and ‘Net exposure, ex collateral’ and amounted to DKK
1403.8 billion at 30 September 2024 (31 December 2023: DKK 1,413.5 billion).
The table below breaks down credit exposure by business unit and underlying segment.
Credit exposure by business unit
(DKK billions)
30 September 2024
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
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
431.8
99.6
75.7
89.9
71.9
-
769.0
49.0
313.2
317.0
0.4
679.5
649.8
105.6
154.8
20.1
3.2
5.5
3.7
3.2
0.1
35.7
10.4
35.3
24.9
-
70.6
35.0
3.5
0.1
2,358.7
145.0
6.3
0.5
2.0
0.4
0.7
-
9.8
2.6
10.8
1.2
-
14.6
5.7
1.6
-
31.7
0.8
0.1
0.1
-
-
-
1.1
0.1
1.2
0.4
-
1.7
0.6
0.3
-
3.6
1.0
0.2
0.2
0.1
0.1
-
1.5
0.3
3.1
0.9
-
4.3
1.6
0.1
-
7.5
1.4
0.1
0.6
0.1
0.3
-
2.4
0.7
3.9
0.3
-
4.9
1.3
0.5
-
9.1
431.0
99.6
75.6
89.9
71.9
-
767.8
48.9
312.0
316.6
0.4
677.8
649.2
105.3
154.8
19.1
3.0
5.3
3.7
3.1
0.1
34.2
10.0
32.3
24.0
-
66.3
33.4
3.4
0.1
4.9
0.4
1.4
0.3
0.5
-
7.4
1.9
6.9
0.9
-
9.6
4.4
1.1
-
53.8
28.9
4.4
8.5
12.1
-
107.6
17.3
101.4
51.1
0.4
170.1
571.5
55.0
152.4
2,355.0
137.4
22.6
1,056.7
1.5
0.5
0.3
0.4
0.6
0.1
3.3
2.3
12.4
3.5
-
18.2
29.2
0.4
0.1
51.2
-
-
-
-
-
-
-
-
0.9
0.1
-
1.0
2.3
-
-
3.3
52
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Credit exposure – continued
31 December 2023*
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
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
424.0
101.8
76.9
125.9
76.5
-
805.0
52.7
309.6
308.0
0.4
670.6
595.9
89.4
232.3
18.6
2.9
5.6
4.3
3.1
-
34.6
9.4
36.8
24.9
-
71.1
33.8
4.7
0.1
2,393.3
144.2
6.2
0.3
1.9
0.5
0.7
-
9.6
1.4
10.4
2.3
0.1
14.2
6.9
1.9
-
32.7
1.0
0.1
0.2
-
-
-
1.3
0.1
1.1
0.4
-
1.6
0.4
0.3
-
3.6
0.9
0.2
0.2
0.1
0.1
-
1.6
0.5
3.0
1.1
-
4.7
1.1
0.1
-
7.5
1.3
0.1
0.6
0.1
0.2
-
2.4
0.5
3.7
0.3
-
4.5
1.8
0.4
-
9.1
423.0
101.7
76.7
125.8
76.4
-
803.7
52.6
308.5
307.6
0.4
669.0
595.5
89.1
232.3
17.7
2.7
5.4
4.2
3.0
-
33.0
8.8
33.8
23.8
-
66.4
32.7
4.6
0.1
4.9
0.3
1.3
0.4
0.5
-
7.3
0.9
6.7
2.0
0.1
9.7
5.1
1.5
-
49.4
32.1
4.2
30.1
16.2
-
132.1
19.5
93.3
44.8
0.4
158.0
511.5
48.1
229.7
2,389.7
136.7
23.6
1,079.4
1.8
0.4
0.2
0.7
1.0
-
4.1
1.6
13.8
3.9
-
19.3
29.8
0.8
-
54.1
-
-
-
-
-
-
-
-
0.6
0.1
-
0.6
2.1
0.2
-
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.
53
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Credit exposure – continued
Exposures subject to forbearance measures
The Group adopts forbearance plans to assist customers in financial difficulty. Concessions granted to customers include interest-reduction
schedules, interest-only schedules, temporary payment holidays, term extensions, cancellation of outstanding fees, waiver of covenant
enforcement and debt forgiveness. Forbearance plans must comply with the Group’s Credit Policy. They are used as an instrument to retain
long-term business relationships during economic downturns if there is a realistic possibility that the customer will be able to meet its
obligations again or are used for minimising losses in the event of default.
If it proves impossible to improve the customer’s financial situation by forbearance measures, the Group will consider whether to subject the
customer’s assets to a forced sale or whether the assets could be realised later at higher net proceeds. At the end of the first nine months of
2024, the Group had recognised properties taken over in Denmark at a carrying amount of DKK 16 million (2023: DKK 17 million), and there
were no properties taken over in other countries (2023: DKK 0 million). The properties are held for sale and included under Assets held for sale
in the balance sheet.
The Group applies the European Banking Authority’s (the EBA’s) definition of loans subject to forbearance measures. The EBA definition states
that a probation period of a minimum of two years must pass from the date when forborne exposures are considered to be performing again.
Forbearance measures lead to changes in staging for impairment purposes, and impairments relating to forborne exposures are handled
according to the principles described in note G15 in Annual Report 2023.
Exposures subject to forbearance measures
(DKK millions)
Stage 1
Stage 2
Stage 3
Total
30 September 2024
31 December 2023
227
7,477
7,446
15,150
297
5,279
7,023
12,598
54
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Credit exposure - continued
Allowance account broken down by stage
Allowance account broken down by segment
Stage 3*
8,290
Total
19,645
Personal
Customers
Business
Customers
Large
Corporates &
Institutions Northern Ireland
Group
Functions*
(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
Stage 1
3,273
2,023
-198
-19
492
-391
Stage 2
8,082
-1,924
487
-355
843
-957
Impact of net remeasurement of ECL (incl. changes in models)
-1,781
1,779
Write-offs debited to the allowance account
Foreign exchange adjustments
Other changes
ECL allowance account as at 30 September 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
-2
-29
-1
3,366
3,592
984
-243
-22
452
-400
-695
-9
-15
1
-
-85
-1
7,868
7,486
-894
516
-343
1,285
-1,175
713
-
-63
-11
(DKK millions)
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
ECL allowance account as at 30 September 2023
ECL allowance account as at 1 January 2024
ECL on new assets
ECL on assets derecognised
Impact on remeasurement of ECL (incl. change in
models)
2,617
Write-offs debited to allowance account
-2,228
Foreign currency translation
89
Other changes
-99
-289
374
867
-811
685
-318
-37
12
8,673
9,062
-90
-273
364
880
-652
71
-267
-23
-6
-
-
-
2,201
-2,160
682
-320
-152
11
19,907
20,140
-
-
-
-276
-101
-16
5,427
387
-547
201
-134
-25
-16
5,291
5,306
346
-554
21
-95
-21
6
10,235
1,343
-1,531
677
-142
-109
20
10,494
10,705
1,457
-1,575
594
-130
-95
-8
3,050
421
-41
-47
-33
-42
8
3,315
3,308
672
-56
-408
-40
-16
-13
863
58
-33
-121
-11
25
1
781
794
140
-40
-115
-12
33
-
801
70
-7
-8
-28
1
-1
-2
25
27
1
-2
-3
-
-1
-1
20
Total
19,645
2,201
-2,160
682
-320
-152
11
19,907
20,140
2,617
-2,228
89
-276
-101
-16
20,225
ECL allowance account as at 30 September 2024
5,008
10,948
3,447
* With effect from 1 January 2024, Non-core ceased to exist as a separate segment. The allowance account in 2023 previously reported under Non-core has been
reclassified, and comparatives have been restated to reflect this change.
ECL allowance account as at 30 September 2024
3,645
7,512
9,068
20,225
* With effect from 1 January 2024, Non-core ceased to exist as a separate segment. The allowance account in 2023 previously reported under Non-core has been
reclassified, and comparatives have 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.
55
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Credit exposure - continued
Forward-looking information
The incorporation of forward-looking information reflects the expectations of the Group’s senior management and involves both
macroeconomic scenarios (base case, upside and downside scenarios), including an assessment of the probability for each scenario, and post-
model adjustments. The purpose of using multiple scenarios is to model the non-linear impact of assumptions about macroeconomic factors
on the expected credit losses. Post-model adjustments are used to capture specific risks which are not fully covered by the macroeconomic
scenarios, as well as the process related risk, which could lead to an underestimation of the expected credit losses.
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 nine months of 2024 have been updated with the latest
macroeconomic data. For the Nordic markets overall 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. There are however slight deviations within
individual Nordic countries’ expectations for inflation and interest rates.
The base case is an extension of the Group’s official view of the Nordic economies (the Nordic Outlook report). At 30 September 2024, the base
case scenario reflects a soft landing with economic growth moving toward normalised levels. Inflation is coming down and reductions in
interest rates are expected during 2024-2025. The Nordic property markets have generally recovered, and modest price increases are
expected.
The upside scenario represents a slightly better outlook than the base case scenario across the macroeconomic parameters. In this scenario, it
is predominantly the European businesses’ profit margins and not prices that absorb the adjustment to higher wage costs and inflation returns
more sustainably to target than in the base case. Central banks no longer hesitate to cut interest rates and all Nordic central banks loosen
policies a bit quicker than in the base case. 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 interest rates and high inflation. A trigger of the economic setback could be continued macroeconomic worsening and challenges linked to
high business costs while inflation remains elevated. This adversely impacts the labour market and results in higher and more persistent
unemployment. This would lead to a severe slowdown in the economies in which the Group is represented.
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).
The main macroeconomic parameters in the base case, upside and downside scenario entering into the ECL calculation for the forecast
horizon across the Group’s Nordic markets are included below.
56
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Credit exposure – continued
Macroeconomic scenarios
30 September 2024
Denmark
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Sweden
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Norway
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Finland
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
57
Danske Bank / Interim report – first nine months 2024
2024
Base-case
2025
2026
1.8
2.9
1.6
4.0
3.1
1.2
8.4
2.8
3.5
2.6
0.7
2.1
3.7
3.3
4.7
-0.4
8.3
1.9
-1.0
3.1
2.0
3.1
2.0
2.5
2.6
2.4
8.2
0.6
5.0
2.1
2.0
2.4
2.4
6.9
3.5
1.8
8.0
1.5
4.0
2.7
1.7
3.2
1.8
2.3
2.2
1.8
7.8
1.5
3.0
2.1
2.5
2.5
2.0
7.9
2.5
1.5
7.2
1.7
2.0
2.3
2024
-3.4
6.4
4.0
-19.7
5.0
-3.5
9.8
4.9
-22.0
5.7
-2.7
5.5
4.5
-19.0
6.3
-2.4
10.9
4.0
-14.2
5.1
Downside
2025
2026
2024
Upside
2025
2026
-2.0
-
7.4
3.0
-11.0
5.0
-3.4
10.7
3.9
-13.0
5.7
-1.1
6.4
3.0
-13.0
6.3
-2.0
11.9
3.0
-7.0
5.1
7.8
2.0
-6.0
3.0
-1.0
11.1
2.9
-7.0
3.7
0.6
6.5
2.0
-7.0
4.3
-0.3
11.9
2.0
-5.0
3.1
1.8
2.9
1.5
4.0
2.9
1.2
8.4
2.7
3.5
2.4
0.7
2.1
3.7
3.3
4.5
-0.4
8.3
1.8
-1.0
3.1
2.3
3.0
1.5
4.5
2.2
2.7
8.1
0.1
7.0
2.1
2.3
2.3
2.1
7.9
3.0
2.1
7.9
1.0
5.0
2.0
1.9
3.1
1.8
4.3
2.2
2.2
7.6
1.4
5.0
2.1
2.7
2.4
1.9
9.9
2.5
1.9
7.1
1.6
4.0
2.3
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Credit exposure – continued
31 December 2023
Denmark
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Sweden
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Norway
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
Finland*
GDP
Unemployment
Inflation
Property prices - Residential
Interest rate - 3 month
* Macroeconomic parameters for Finland have been corrected as at 31 December 2023.
58
Danske Bank / Interim report – first nine months 2024
2024
Base-case
2025
2026
1.0
3.1
2.0
1.5
3.1
1.2
8.2
1.9
-1.0
3.4
1.1
2.3
3.0
-1.0
3.7
0.3
7.8
1.9
2.0
3.1
1.6
3.3
1.9
2.0
2.3
1.8
8.0
1.3
4.0
2.3
2.1
2.5
2.0
5.0
2.9
1.9
7.2
1.5
3.0
2.3
1.6
3.4
1.8
2.1
2.0
2.4
7.9
1.6
5.0
2.0
1.5
2.5
2.0
4.0
2.5
1.3
6.5
2.0
2.0
2.0
2024
-3.4
6.3
4.0
-19.7
5.4
-3.5
9.4
4.9
-22.0
5.7
-2.7
5.5
4.5
-19.0
6.3
-2.4
9.9
4.0
-14.2
5.1
Downside
2025
2026
2024
Upside
2025
2026
-2.0
7.5
3.0
-11.0
6.4
-3.4
10.3
3.9
-13.0
5.7
-1.1
6.4
3.0
-13.0
6.3
-2.0
10.9
3.0
-7.0
5.1
-
7.9
2.0
-6.0
3.9
-1.0
10.7
2.9
-7.0
3.7
0.6
6.5
2.0
-7.0
4.3
-0.3
10.9
2.0
-5.0
3.1
2.5
2.7
2.4
3.5
4.3
2.6
7.9
2.0
1.0
4.6
2.5
2.0
3.2
-
5.0
1.3
7.6
2.2
3.0
4.3
1.8
2.6
2.5
3.0
3.5
2.1
7.5
1.6
5.0
3.6
2.4
2.0
2.3
6.0
4.0
2.2
6.9
1.8
4.0
3.5
0.4
3.2
1.4
2.1
2.5
1.3
7.7
1.5
5.0
2.6
0.4
2.3
1.8
4.0
3.0
0.4
6.4
1.7
2.0
2.5
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Credit exposure – continued
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 assessments, the allowance
account as at 30 September 2024 amounted to DKK 20.2 billion (31 December 2023: DKK 20.1 billion). If the base case scenario was assigned a
probability of 100%, the allowance account would decrease by DKK 2.2 billion (31 December 2023: DKK 2.0 billion). Compared to the base case
scenario, the allowance account would increase by DKK 11.0 billion (31 December 2023: DKK 10.2 billion), if the downside scenario was
assigned a probability of 100%. The increase reflects primarily the transfer of exposures from stage 1 to stage 2 and increased expected credit
losses within stage 2. If instead the upside scenario was assigned a probability of 100%, the allowance account would decrease by DKK 0.2
billion (31 December 2023: DKK 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 forecasts of expected credit losses (ECL).
Post-model adjustments
Management applies judgement when determining the need for post-model adjustments. At 30 September 2024, the post-model adjustments
amounted to DKK 6.4 billion (31 December 2023: DKK 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 agriculture
industry. For such industries, supplementary calculations are made to ensure sufficient impairment coverage. This also includes 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 macroeconomic
forecasts used in the models are based on the property market as a whole.
portfolios where the credit risk assessment process has identified an underestimation of the expected credit losses.
Following the significant impact on the expected credit losses from post-model adjustments, the table below provides more information about
the adjustments.
Post-model adjustments by industries
(DKK billions)
Agriculture
Commercial Property
Construction and building materials
Personal customers (including other retail exposures)
Others*
Total
30 September 2024
31 December 2023
0.9
1.9
1.0
1.3
1.4
6.4
0.8
1.9
1.0
1.6
1.4
6.7
* No individual industry included in Others exceeds DKK 0.3 billion at 30 September 2024 (2023: DKK 0.2 billion).
The total balance of post-model adjustments is reduced 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, however
reduced from Q2.
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, higher for longer interest rates and elevated prices giving rise to a new set of challenges that
affect economic and business activity. The post-model adjustments cut across industries that are sensitive to price rises on energy, e.g.
agriculture and metals, and industries vulnerable to business cycles, higher 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.
59
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Counterparty credit risk and credit exposure from trading
and investment securities
Exposure to counterparty credit risk and credit exposure from trading and investment securities
Derivatives with positive fair value
(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
30 September
31 December
2024
2023
(DKK millions)
276.9
334.7
446.8
56.8
-
Derivatives with positive fair value before netting
351.7
Netting (under accounting rules)
267.9
Carrying amount
Netting (under capital adequacy rules)
461.0
Net current exposure
19.4
0.1
Collateral
Net amount
1,115.3
1,100.1
Derivatives with positive fair value after netting for accounting purposes:
* 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 334.1 billion (31 December 2023: DKK 267.4 billion), of which DKK 111.7 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.
Interest rate contracts
Currency contracts
Other contracts
Total
30 September
2024
31 December
2023
723,859
446,930
276,928
196,721
80,207
70,352
9,855
201,622
73,388
1,919
892,840
541,118
351,722
262,273
89,450
80,713
8,736
240,621
110,275
826
276,928
351,722
60
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Bond portfolio
(DKK millions)
ment bonds
bonds
bonds
Central and
Quasi-
Danish
local govern-
government
mortgage
30 September 2024
Held-for-trading (FVPL)
Managed at fair value (FVPL)
Held to collect and sell (FVOCI)
Held to collect (AMC)
Total
31 December 2023
Held-for-trading (FVPL)
Managed at fair value (FVPL)
Held to collect and sell (FVOCI)
Held to collect (AMC)
Total
Swedish
covered
bonds
27,783
1,415
2,302
3,070
117,892
1,868
20,872
40,931
2,669
163
3,093
8,467
20,601
16,728
52,159
87,548
181,563
14,391
177,035
34,570
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
191,392
12,926
188,321
32,038
Other
covered
Corporate
bonds
bonds
Total
4,461
232
23,998
812
29,503
3,272
286
25,077
1,013
29,648
7,662
-
1,948
150
9,760
5,179
-
1,330
150
6,659
181,067
20,406
104,372
140,978
446,822
177,563
20,798
107,226
155,398
460,984
At 30 September 2024, the Group had an additional bond portfolio, including bond-based unit trust certificates, worth DKK 212,800 million
(31 December 2023: DKK 214,073 million) recognised as recognised as insurance assets and thus and thus not included in the table above.
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 30 September 2024 and 31 December 2023, see note G13 for more information.
61
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Counterparty credit risk and credit exposure from trading and investment
securities continued
Bond portfolio broken down by geographical area
(DKK millions)
30 September 2024
Denmark
Sweden
UK
Norway
USA
Spain
France
Luxembourg
Finland
Ireland
Italy
Portugal
Austria
Netherlands
Germany
Belgium
Other
Total
Central and
Quasi-
Danish
local govern-
government
mortgage
ment bonds
bonds
bonds
36,054
31,180
9,665
4,163
15,488
898
15,994
-
9,659
430
3,876
6
2,740
2,980
47,576
854
-
-
-
303
-
3,230
-
179
5,210
3,237
-
-
-
-
2
-
1,588
643
177,035
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Swedish
covered
bonds
-
34,570
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Other
covered
Corporate
Central and
Quasi-
Danish
local govern-
government
mortgage
bonds
bonds
Total
(DKK millions)
ment bonds
bonds
bonds
Swedish
covered
bonds
Other
covered
Corporate
bonds
bonds
Total
-
-
4,154
23,363
-
1
345
-
1,193
-
-
-
-
41
208
-
198
1,063
3,030
1,146
2,747
19
-
23
125
694
42
3
-
147
386
101
-
235
31 December 2023
214,153
Denmark
68,779
Sweden
15,268
UK
30,273
Norway
18,737
USA
899
Spain
16,542
France
5,335
Luxembourg
14,783
Finland
471
Ireland
3,879
Italy
6
Portugal
2,886
Austria
3,409
Netherlands
47,884
Germany
2,443
Belgium
1,076
Other
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
-
-
-
188,321
-
-
32,038
291
-
-
-
-
-
3,274
-
-
-
19
5,205
2,954
-
-
-
-
1
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
442
740
-
-
-
-
-
-
3,518
23,902
-
1
237
-
1,089
-
-
-
66
17
216
1
602
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
181,563
14,391
177,035
34,570
29,503
9,760
446,822
Total
191,392
12,926
188,321
32,038
29,648
6,659
460,984
62
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Counterparty credit risk and credit exposure from trading and investment
securities continued
Bond portfolio broken down by external ratings
(DKK millions)
30 September 2024
AAA
AA+
AA
AA-
A+
A
A-
BBB+
BBB
BBB-
BB+
BB
BB-
Central and
Quasi-
Danish
local govern-
government
mortgage
ment bonds
bonds
bonds
Swedish
covered
bonds
Other
covered
Corporate
Central and
Quasi-
Danish
local govern-
government
mortgage
bonds
bonds
Total
(DKK millions)
ment bonds
bonds
bonds
Swedish
covered
bonds
Other
covered
Corporate
bonds
bonds
Total
176,919
34,551
28,725
2,623
373,189
117,515
25,704
10,946
22,365
-
725
6
173
2,473
1,403
-
-
-
12,857
1,514
-
21
-
-
-
-
-
-
-
-
-
-
-
-
-
-
116
-
-
-
-
-
-
-
-
-
19
14
764
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
24
1,680
115
66
1,201
306
897
1,668
533
165
344
43
97
31 December 2023
AAA
AA+
AA
AA-
A+
A
A-
27,255
13,409
22,500
66
2,042
312
1,070
BBB+
4,141
1,936
165
344
43
350
BBB
BBB-
BB+
BB
BB-
Sub. "investment-grade" or unrated
137,601
12,461
187,903
32,017
28,925
1,623
400,530
27,061
8,556
15,515
-
1,132
3
111
377
1,036
-
-
-
-
442
-
23
-
-
-
-
-
-
-
-
-
-
-
-
-
-
418
-
-
-
-
-
-
-
-
-
21
28
692
-
-
-
-
-
-
-
-
-
-
-
-
-
4
-
-
-
-
-
-
-
-
2
965
117
266
984
196
505
987
596
97
187
36
97
27,533
10,234
15,654
266
2,538
199
617
1,364
1,632
97
187
36
97
Sub. "investment-grade" or unrated
253
Total
181,563
14,391
177,035
34,570
29,503
9,760
446,822
Total
191,392
12,926
188,321
32,038
29,648
6,659
460,984
63
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Statement by the
management
The Board of Directors and the Executive Leadership Team (the
management) have today reviewed and adopted the Interim report – first
nine months 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 disclosure 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 assets, liabilities, shareholders´ equity and financial
position at 30 September 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 30 September 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.
64
Danske Bank / Interim report – first nine months 2024
Copenhagen, 31 October 2024
Executive Leadership Team
Carsten Egeriis
CEO
Joachim Alpen
Magnus Agustsson
Christian Bornfeld
Karsten Breum
Stephan Engels
Johanna Norberg
Dorthe Tolborg
Frans Woelders
Martin Blessing
Chairman
Board of Directors
Martin Nørkjær Larsen
Vice Chairman
Lars-Erik Brenøe
Jacob Dahl
Raija-Leena Hankonen-Nybom
Lieve Mostrey
Allan Polack
Helle Valentin
Kirsten Ebbe Brich
Elected by the employees
Aleksandras Cicasovas
Elected by the employees
Bente Bang
Elected by the employees
Louise Aggerstrøm Hansen
Elected by the employees
Financial highlights
Executive summary
Financial review
Business units
Financial statements
Supplementary information
Financial calendar
31 October 2024
07 February 2025
20 March 2025
02 May 2025
18 July 2025
31 October 2025
Contacts
Claus Ingar Jensen
Interim report – first nine months 2024
Annual Report 2024
Annual general meeting
Interim report – first quarter 2025
Interim report – first half 2025
Interim report – first nine months 2025
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.
65
Danske Bank / Interim report – first nine months 2024
Financial highlights
Executive summary
Financial review
Business units
Financial statements
xxx
66
Danske Bank / Interim report – first nine months 2024
Danske Bank Group
Bernstorffsgade 40
DK-1577 Copenhagen V
Tel. +45 33 44 00 00
CVR No. 611262 28-København
danskebank.com