Danske Bank A/s · OMXCOP:DANSKE
Danske Bank A/s — FY2004 Earnings Presentation
22 slides from Danske Bank A/s's earnings presentation, Feb 10, 2005
Slide 1: Annual Report 2004
Annual Report 2004 Copenhagen, February 10, 2005
Slide 2: 2004 in brief
Highlights 2004 in brief - Best financial results ever (DKr m) 2003 2004 Index Net profit for the year á 14% to DKr10.6bn Core income 26,949 27,257 101 Core income increased 1% Expenses 14,820 14,593 98 Operating expenses decreased 2% Core earnings before prov. 12,129 12,664 104 Provisions for b
Slide 3: Lending
Financial highlights Lending - Strong lending growth in 2004 Bank lending á15% Strong lending growth in all the Nordic countries throughout the year DKr bn Lending growth Growth dominated by property financing 550 High corporate loan growth in Norway 2003 2004 and Sweden Denmark is picking u
Slide 4: Key figures and ratios
Financial highlights Key figures and ratios - Improvement across the board Return on equity rose to 17.4% Key ratios 2003 2004 Core return on equity increased Net profit as % of avg. sh. equity p.a. 15.2 17.4 by nearly 4 percentage points Return on equity up slightly less due to Core earnings as
Slide 5: Net interest income
Business trends Net interest income - Positive trend throughout the whole year Net interest income â 2% DKr bn Net interest income % 4.25 4 Lower interest rates reduced income Danish money market rate by DKr400m, mainly in H1 3.75 2 Growth primarily in low-margin products, primarily property-fin
Slide 6: Costs
Business trends Costs - Favourable trend continues Costs â 2% DKr bn ß Costs and C/I ratio à % 16 58 Costs totalled DKr14.6bn as expected C/I ratio C/I ratio improved from 55% to 53.5% 14 54 Focus on rationalisations to continue, but costs are unlikely to fall going forward 12 50 2002 2003 2
Slide 7: Loan-loss provisions
Business trends Loan-loss provisions - Net loan-loss provisions of zero Loan-loss provisions down to zero DKr m Loan-loss provisions 500 Average Sharply reduced need for net provisions Healthy macroeconomic conditions in the Nordic countries 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Net reversal a
Slide 8: Capital structure
Capital structure Capital structure - Core capital ratio and solvency ratio above stated goals The acquisition requires capital (as % of RWA) Target 2004 Core capital and solvency ratios Core capital ex hybrid capital 6.5 7.2 currently above stated targets Share buyback for DKr5bn in 2004 Hybrid
Slide 9: Banking Activities, Danske Bank
Trends in business areas Banking Activities, Danske Bank - Strong volume growth lower margins DKr bn Core earnings 4 Core earnings á 22% Strong growth in retail lending 3 Lending to corporates picked up in the second half of 2004 2 Lower margins due to product mix changes 2003 2004 Adj. for
Slide 10: Banking Activities, BG Bank
Trends in business areas Banking Activities, BG Bank - Strong volume growth improved cost/income ratio DKr m Core earnings 1,700 1,200 Core earnings á 25% Strong growth in retail lending: 26% 700 2003 2004 Adj. for rate 2004 adj. C/I ratio improved by 2 percentage points decline No loan-loss
Slide 11: Customer and employee satisfaction
Trends in business areas Customer and employee satisfaction - Increasing across the board Increasing customer satisfaction Index Customer satisfaction 80 Satisfaction rose 2 points in 2004 (private customers) Danske Bank BG Bank BG Banks improvement in 2003 75 maintained 70 65 2002 2003 2004 Em
Slide 12: Banking Activities Norway
Trends in business areas Banking Activities Norway - Increasing market share DKr m Core earnings 800 600 Core earnings á 46% 400 á 42% in local currency) (á 200 Unchanged income in spite of 2003 2004 Adj. for Adj. for FX 2004 adj. rate effect healthy lending growth decline Falling net interest i
Slide 13: Banking Activities, Sweden
Trends in business areas Banking Activities, Sweden - High growth in earnings and business volume DKr m Core earnings 1,000 Core earnings á 42% á 41% in local currency) (á 600 Strong growth in retail and corporate lending 200 Increasing income due to strong 2003 2004 Adj. for Adj. for FX 2004 ad
Slide 14: Mortgage Finance
Trends in business areas Mortgage Finance - Product innovation supports growth DKr bn Core earnings 2.5 2.0 Core earnings á 8% 4% lending growth 1.5 Costs lower 2003 2004 Adj. for rate 2004 adj. decline Successful launch of FlexGaranti® DKr bn Gross new lending 2004 boosted income in Q4 50 Oth
Slide 15: Danske Markets
Trends in business areas Danske Markets - Lower result, as expected Core earnings â 16% DKr m Core earnings Normalised activity level 1,500 Increased earnings from equity trading and Corporate Finance 1,000 Maintained leading market positions in Denmark and Sweden 500 Improved position in No
Slide 16: Danica Pension
Trends in business areas Danica Pension - Good growth in premiums and high investment returns Core earnings á 18% DKr m Core earnings Regular premiums up 13% 1,200 Continued growth in unit-linked business Investment return on customers funds 800 rose from 6.4% to 10.3% Danica has green lig
Slide 17: Danske Capital
Trends in business areas Danske Capital - Lower costs increase earnings Core earnings á 29% DKr m Core earnings Assets under management 400 increased by 8% Lower margin due to changes in 300 product mix and customer mix Costs reduced by 19% 200 2003 2004 17
Slide 18: Employee shares
Trends in business areas Employee shares - DKr110m after fulfilment of stated goals Employee shares to all employees Facts about employee shares Allocated after fulfilment of stated goals Total value: DKr110m 2.5% of the increase in core earnings Purchase price: free of charge Measures for
Slide 19: Status of the NIB and NB acquisition
Trends in business areas Status of the NIB and NB acquisition The acquisition National Irish Bank in brief Two banks: Market share of 2%-3% National Irish Bank (NIB), Rep. of Ireland 59 branches and 13 business Northern Bank (NB), Northern Ireland centres Price paid: DKr10.4bn 134,000
Slide 20: Banking Activities UK & US
Trends in business areas Banking Activities UK & US - Status of the downscaling and closure of wholesale activities Closure of branch in New York and downscaling international wholesale banking activities in UK were announced in November Unfavourable market conditions limited earnings and potent
Slide 21: Outlook for 2005
Outlook for 2005 Outlook for 2005 - In an IFRS regime Macroeconomic outlook: moderate growth, low inflation and low interest rates Total income higher, mainly because of NIB & NB Stable costs, excluding NIB & NB Higher cost/income ratio Loan portfolio quality will remain high, and loan- lo
Slide 22: www.danskebank.com
www.danskebank.com