Market developments for banks in 2014

Published 12-05-2015

The Danish Banks achieved net profits of DKK 16,3 bn. in 2014 at level with 2013. The core earnings from net interest and fee income increased compared to last year.

Total profits before tax for all banks in 2014 were DKK 16.3 bn. and therefore at the same level as profits for 2013. However, if the impairment charges on goodwill of DKK 9.0 bn. made by Danske Bank on foreign activities are excluded, there was a considerable improvement in profits compared with the previous year.

Decreasing impairment charges and higher fee and commission income have had a positive effect, although this has been countered by negative value adjustments.

Impairment charges again fell in 2014 and amounted to DKK 12.5 bn. This is 27% less than last year. Impairment charges for the year amounted to 0.6% of banks’ total lending and guarantees; the lowest level since the start of the financial crisis and lower than the average over the past 25 years of 1.0%.

Net interest income for banks in 2014 was similar to 2013 and amounted to DKK 47.6 bn. This reflects continued drops in lending and interest rates in general. Overall, the effects of negative interest rates have so far been limited and have been countered in part by other income from increased fee and commission income. Net fee and commission income rose by more than DKK 2.7 bn. compared with the previous year and totalled DKK 23.4 bn. in 2014.

Read the analysis here.

Last updated 11-08-2015