Danske Bank A/s · OMXCOP:DANSKE
Danske Bank A/s — Q4 2024 Earnings Presentation
64 slides from Danske Bank A/s's earnings presentation, February 2025
Slide 1: Investor Presentation: Financial results Q4 2024
Investor Presentation Financial results Q4 2024
Slide 2: Contents
Investor Presentation - FY2024 Contents Danske Bank – brief overview 03 – 10 Financial highlights – Q4 2024 11 – 17 Business & Product Units 18 – 23 ESG, Sustainability, Financial Crime Prevention 24 – 37 Credit Quality & Impairments 38 – 44 Capital 45 – 48 Funding & Liquidity 49 – 53 Credit & ESG R
Slide 3: Danske Bank - a brief overview
Danske Bank - a brief overview Danske Bank 3
Slide 4: We are a focused Nordic bank with strong regional roots
Investor Presentation - FY2024 We are a focused Nordic bank with strong regional roots Finland (AA+) >2.9m 2,000+ ~20,000 3rd largest personal and business large corporate and employees in Share of Group lending: 9% customers institutional customers 10 countries GDP growth 2025E: 1.8% DKK >880bn* >D
Slide 5: Nordic Outlook December 2024: More growth, new risks
Investor Presentation - FY2024 Nordic Outlook December 2024: More growth, new risks Denmark Sweden 2023 Forecast 2024 Forecast 2025 2023 Forecast 2024 Forecast 2025 GDP Growth 2.5% 3.0% (1.8%) 2.5% (2.0%) GDP Growth 0.2% 0.7% (1.2%) 2.5% (2.4%) Inflation 3.3% 1.4% (1.5%) 1.8% (1.9%) Inflation 8.6% 3
Slide 6: Historical macroeconomic development in the Nordics
Investor Presentation - FY2024 Historical macroeconomic development in the Nordics GDP development (%) Unemployment (%) House prices (index 100=2006) 8 14 280 6 260 12 4 240 10 220 2 200 0 8 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 180 -2 6 160 -4 4 140 -6 120 2 -8 100 80 2006 2008 201
Slide 7: Our commitments for 2026
Investor Presentation - FY2024 Our commitments for 2026 Growth in focus segments How we measure progress1 Financial targets for ‘26 13% Leading wholesale and business bank in the Nordics Personal Number of meetings per Customers advisor (Index: 2023 = 100) 163 Leading retail bank in Denmark and Finl
Slide 8: Highlights: Strong financial performance supported by solid uplift in core banking income
Investor Presentation - FY2024 Highlights: Strong financial performance supported by solid uplift in core banking income; robust credit quality and capital distribution according to plan Record FY net profit Total income +8% Y/Y DKK 23.6bn (+11% Y/Y) underpinned by commercial activity Supported by c
Slide 9: Danske Bank's strong balance sheet underpins our resilient business model
Investor Presentation - FY2024 Danske Bank’s strong balance sheet underpins our resilient business model which includes a well-balanced ALM strategy and a very strong liquidity position Danske Bank has a sound funding structure and remains very well capitalised with a prudent CET1 capital buffer to
Slide 10: We have defined our strategic approach and priorities for sustainability
Investor Presentation - FY2024 We have defined our strategic approach and priorities for sustainability To be a leading Nordic bank in supporting the sustainability transition of Our strategic ambition customers, companies we invest in and Nordic societies Create lasting value for our customers, bus
Slide 11: Financial highlights – fourth quarter 2024
Financial highlights – fourth quarter 2024 Danske Bank 11
Slide 12: Increased profitability ensured by strong uplift in core banking income
Investor Presentation - FY2024 Increased profitability ensured by strong uplift in core banking income; cost trajectory as planned; strong credit quality enables net reversal of impairments Highlights Income statement (DKK m) Total income up 8% Y/Y driven by sustained uplift 2024 2023 Index Q4 24 Q3
Slide 13: NII: Resilient NII supported by volumes and treasury effects
Investor Presentation - FY2024 NII: Resilient NII supported by volumes and treasury effects which mitigate central bank rate cuts and despite timing of pricing adjustments Highlights NII 2024 vs 2023 (DKKm) Deposit margin development* (%) 36,697 3.0 0 2.68 Net interest income trended in line with 2.
Slide 14: Fee income: Broad-based and strong uplift in fee income
Investor Presentation - FY2024 Fee income: Broad-based and strong uplift in fee income; up 35% Q/Q driven by record-high performance fees in Asset Management Highlights Net fee income (DKK m) Activity-driven fees (transfers, accounts, etc.) 14,912 Solid income uplift driven by demand for everyday 1,
Slide 15: Trading income: Customer activity impacted by seasonality in Q4
Investor Presentation - FY2024 Trading income: Customer activity impacted by seasonality in the fourth quarter Highlights Net trading income (DKK m) LC&I 2,668 Y/Y: H1-23 was exceptionally strong at LC&I 2,613 Q/Q: Subdued customer activity given usual -160 seasonality in Q4 9 428 -88 Northern Irela
Slide 16: Expenses: Cost trajectory in line with plan
Investor Presentation - FY2024 Expenses: Cost trajectory in line with plan - inflation and investments mitigated by lower costs related to legacy cases Highlights Expenses (DKK m) 25,736 Total operating expenses up slightly Y/Y as 37 consistent cost management mitigated wage 25,478 -361 388 inflatio
Slide 17: Financial outlook for 2025
Investor Presentation - FY2024 Financial outlook for 2025 Total income is expected to be slightly lower in 2025 than in 2024, driven by lower NII from expected lower market rates. Core banking income will continue to benefit from strong fee income and our continued Income efforts to drive commercial
Slide 18: Business & Product Units
Business & Product Units Danske Bank 18
Slide 19: Personal Customers: Strong customer activity drives solid fee income
Investor Presentation - FY2024 Personal Customers: Strong customer activity drives solid fee income and deposit inflow, offsetting muted lending demand Highlights Financial performance KPIs Strategic KPIs Y/Y total income up 2%*, driven by Total income ROAC (%) Cost/income (%) FY 24 2026 increased n
Slide 20: Business Customers: Fee income growth driven by strong customer activity
Investor Presentation - FY2024 Business Customers: Fee income growth driven by strong customer activity. Strong performance on strategic KPIs Highlights Financial performance KPIs Strategic KPIs Total income declined 4% Y/Y, with Total income ROAC (%) Cost/income (%) FY 24 2026 increase in net fee i
Slide 21: Large Corporates & Institutions: Significant growth in capital efficient income
Investor Presentation - FY2024 Large Corporates & Institutions: Significant growth in capital efficient income driven by strong performance across franchise Highlights Financial performance KPIs Strategic KPIs Strong performance driving total Total income ROAC (%) Cost/income (%) FY 24 2026 income u
Slide 22: Business units: Loan growth in Northern Ireland, Danica provisions
Investor Presentation - FY2024 Business units: Loan growth in Northern Ireland, while Danica impacted by increase in provisions related to health & accident business Lending continued to grow in line with our strategy, driven by residential mortgages Profit before imp. (DKK m) Lending (index) suppor
Slide 23: Realkredit Danmark portfolio overview: Continued strong credit quality
Investor Presentation - FY2024 Realkredit Danmark portfolio overview: Continued strong credit quality Highlights Retail loans, Realkredit Danmark, Q424 (%) ( ) = Q324 Portfolio facts, Realkredit Danmark, Q424 Fixed rate (10 yrs-30 yrs) Interest-only Approx. 291,000 loans (residential and commercial)
Slide 24: ESG, Sustainability, Financial Crime Prevention
ESG, Sustainability, Financial Crime Prevention Danske Bank 24
Slide 25: Sustainability is an integrated element of our Forward '28 strategy
Investor Presentation - FY2024 Sustainability is an integrated element of our Forward ’28 strategy Our starting point What we will do Large Corporates & Institutions Personal Customers Sustainable finance advisory services, Housing, investments, pensions, Advisory transition finance and project fina
Slide 26: Targets and ambitions covering our three sustainability agendas
Investor Presentation - FY2024 We have set targets and ambitions covering each of our three sustainability agendas Climate change Nature & biodiversity Human rights & social impact We reduce emissions across our value chain We engage with high-impact sector companies We continuously develop our huma
Slide 27: Climate Action Plan aligned with Paris Agreement launched in January 2023
The disclaimer for the Climate Action Plan Progress Report 2023 applies to all information shown on this slide (see slide 63) Investor Presentation - FY2024 Climate Action Plan aligned with Paris Agreement launched in January 2023 More than 99% of our carbon footprint relates to financed emissions f
Slide 28: Our Climate Progress Report shows positive traction across targets
The disclaimer for the Climate Progress Report 2024 applies to all information shown on this slide Investor Presentation - FY2024 Our Climate Progress Report shows positive traction across targets, though some targets do not follow linear trajectories Below or within 5% above linear trajectory 5–10%
Slide 29: 2024 highlights on the sustainability agenda
Investor Presentation - FY2024 2024 highlights on the sustainability agenda contributing to strong performance Partnerships to strengthen the green transition in Expansion of energy improvement loans the real estate sector Favourable loans for home energy improvements expanded Danske Bank entered in
Slide 30: In 2024, we have continued our work on nature & biodiversity
Investor Presentation - FY2024 In 2024, we have continued our work on nature & biodiversity Target execution Insights and communication Lending engagement targets reached and asset management target on track Two publications launched Business Customers Large Corporations & Institutions Asset Managem
Slide 31: Deep dive – Overview of ESG integration in lending operations
Investor Presentation - FY2024 Deep dive – Overview of ESG integration in Danske Bank’s lending operations 1. Position statements 2. Single-name ESG analysis 3. Portfolio-level ESG analysis Our position statements are a key tool for ESG analysis is conducted for all large corporate Carbon disclosure
Slide 32: Danske Bank is committed to a range of sustainability initiatives
Investor Presentation - FY2024 Danske Bank is committed to a range of sustainability initiatives – including these key examples Principles for Principles for Net-Zero Banking Alliance Net-Zero Asset Net Zero Asset Responsible Banking Responsible Investment Owner Alliance Managers Initiative The worl
Slide 33: Testing and further strengthening the Financial Crime framework
Investor Presentation - FY2024 Testing and further strengthening the Financial Crime framework Testing of the FC Plan deliveries Roadmap ahead In 2020, the Bank launched the Financial Crime Plan (FC Plan), a As the Financial Crime landscape evolves, the Bank is committed to keeping pace with compreh
Slide 34: The Financial Crime Framework beyond completion of the FC Plan
Investor Presentation - FY2024 The Financial Crime Framework beyond completion of the FC Plan With the completion of the FC Plan, the Bank has in place a Financial Crime framework which meets the regulatory requirements applicable to the Bank and is reasonably designed to manage the Bank’s inherent
Slide 35: Regulatory Engagements
Investor Presentation - FY2024 Regulatory Engagements ▪ We engage in ongoing dialogue with our regulators through regular meetings with the Financial Supervisory Authorities (“FSAs”) and the AML Ongoing Supervisory College to ensure aligned expectations and transparency between our regulators and th
Slide 36: Committee Governance for Financial Crime Compliance Risks
Investor Presentation - FY2024 Committee Governance for Financial Crime Compliance Risks Joint Financial Crime Risk & Compliance Committee Conduct and Compliance Committee • Functions as a discussion and decision forum on Financial Crime risk and related • Board level committee that oversees the Ban
Slide 37: The Resolutions with the Danish and U.S. Authorities
Investor Presentation - FY2024 The Resolutions with the Danish and U.S. Authorities In December 2022, Danske Bank reached the final resolutions with the U.S. Department of Justice (DOJ), the U.S. Securities and Exchange Commission (SEC) and the Danish Special Crime Unit (SCU) following the investiga
Slide 38: Credit quality & Impairments
Credit quality & Impairments Danske Bank 38
Slide 39: Impairments: Strong credit quality with net reversal of impairments
Investor Presentation - FY2024 Impairments: Strong credit quality with net reversal of impairments; prudent PMA buffer remains in place Highlights Impairment charges by category (DKK bn) Credit quality deterioration PMAs Macro models Strong credit quality and modest single-name cases coupled with re
Slide 40: Strong regional footprint and diversified balance sheet
Investor Presentation - FY2024 Strong regional footprint and diversified balance sheet Lending by segment1 Q4 24 (%) Credit exposure by industry Q4 24 (%, rounded) Personal customers 31 4% 2% Commercial property 13 Northern Ireland LC&I Other Private housing co-ops & non-profits 9 of which residenti
Slide 41: Overall strong credit quality in portfolios exposed to macro cyclicality
Investor Presentation - FY2024 Overall strong credit quality in portfolios exposed to macro cyclicality CRE: Well diversified & prudently managed growth Agriculture: Well-provisioned agriculture book Housing: Low leverage, strong household finances DKK 304 bn in credit exposure and ECL ~1% DKK 58bn
Slide 42: Commercial property: Prudently managed and cash-flow based underwriting
Investor Presentation - FY2024 Commercial property: Prudently managed and cash-flow based underwriting standards; sound credit quality & adequate buffers in place to mitigate tail risks Highlights Lending to CRE segment by major peer banks (index)* CRE share of total portfolio by major peer banks* D
Slide 43: Fossil fuels (coal, oil and gas) exposure
Investor Presentation - FY2024 Fossil fuels (coal, oil and gas) exposure Key points Q4 24 Exposure towards exploration and production (E&P) of oil and gas is down by 75% compared to end 2020. The exposure development is aligned with the Group’s 2030 climate target of reducing financed emissions by 5
Slide 44: Credit quality: Low level of actual credit deterioration
Investor Presentation - FY2024 Credit quality: Low level of actual credit deterioration Stage 2 and 3 as % of net exposure Allowance account by business unit (DKK bn) 3.0 12 Stage 3 net exposure (% of Total, rhs) PC LC&I Other (Non-core) 11 2.5 Stage 2 net exposure (% of Total, lhs) 10 BC N.I. 19.6
Slide 45: Capital
Capital Danske Bank 45
Slide 46: Capital: Strong capital base with CET1 ratio of 17.8%
Investor Presentation - FY2024 Capital: Strong capital base with CET1 ratio of 17.8% Capital ratios (%) Current capital buffer structure (%) Tier 2 AT1 Pillar II component (total 3.2%) CET1 Systemic risk buffer 23.1 Countercyclical capital buffer 22.1 22.4 22.3 2.5 Capital conservation buffer 14.6 2
Slide 47: Strong CET1 capital build-up since 2008
Investor Presentation - First nine months 2024 Strong CET1 capital build-up since 2008; Available Distributable Items (ADI) well in excess of DKK 100 bn Common Equity Tier 1, 2008 – 2024 (DKK bn) +68 bn 152 149 155 144 145 126 130 134 133 133 127 133 119 107 77 79 85 2008 2009 2010 2011 2012 2013 20
Slide 48: Fully compliant with MREL and subordination requirement
Investor Presentation - FY2024 Fully compliant with MREL and subordination requirement; expect to cover MREL need with both preferred and non-preferred senior MREL & subordination requirement* and eligible funds Q424 DKK bn (% of Group REA) Comments The Group has to meet a MREL +41 requirement and a
Slide 49: Funding & Liquidity
Funding & Liquidity Danske Bank 49
Slide 50: Funding structure and sources: Danish mortgage system is fully pass-through
Investor Presentation - FY2024 Funding structure and sources: Danish mortgage system is fully pass-through Loan portfolio and long-term funding Q424 (DKK bn) Funding sources* (%) 2,191 Q324 64% Senior & 59% 156 Q424 NPS bonds 1,675 1,095 Deposits Bank loans 621 14% 13% 11% 11% 9% 10% 10% 8% Bank mor
Slide 51: Funding programmes and currencies
Investor Presentation - FY2024 Funding programmes and currencies Covered bonds by currency Q424 Largest funding programmes Q424 54% Utilisation SEK EMTN Programme 46% Limit – EUR 35bn Total Global Covered Bond 38% DKK 129 bn Limit – EUR 30bn 44% EUR ECP Programme 2% 34% CHF Limit – EUR 13bn Senior d
Slide 52: Funding plan
Investor Presentation - FY2024 Funding plan Changes in funding* 2024 - 2025 (DKK bn and bp) Long-term funding excl. RD (DKK bn)** Cov. bonds Senior Non-Preferred Senior Completed Funding plan 17bp 95 162bp 70-90 84bp 33bp 113bp 6bp 139bp 41 79 78 36 75 26 38bp 27 69bp 28 23 17 9 11 Redemptions 2025:
Slide 53: Danske Bank covered bond universe
Investor Presentation - FY2024 Danske Bank covered bond universe – A transparent pool structure, with EUR issuance by Danske Mortgage Bank & Danske Bank A/S “D-pool” and “C-pool” Danske Bank A/S C-pool1 S&P AAA Scope AAA Residential mortgages Denmark, D-pool and I-pool Sweden, Danske Hypotek AB Finl
Slide 54: Credit & ESG Ratings
Credit & ESG Ratings Danske Bank 54
Slide 55: Danske Bank's credit ratings – Positive trajectory throughout 2024
Investor Presentation - FY2024 Danske Bank’s credit ratings – Positive trajectory throughout 2024, with no changes in Q4 Long-term instrument ratings Rating summary Fitch Moody’s Nordic Credit Rating S&P Scope In 2024, Danske Bank’s ratings were raised AAA Aaa AAA AAA AAA on two occasions: AA+ Aa1 A
Slide 56: Credit ratings – No changes by Fitch or Moody's in Q4 2024
Investor Presentation - FY2024 Danske Bank’s credit ratings – No changes by Fitch or Moody’s in Q4 2024 Rating methodology Danske Bank’s rating Operating Business Risk Asset Earnings & Capitalisation & Funding & Viability Government Issuer + + + + + + = + = environment Profile Profile Quality Profit
Slide 57: Credit ratings – No changes by S&P Global or Scope in Q4 2024
Investor Presentation - FY2024 Danske Bank’s credit ratings – No changes by S&P Global or Scope in Q4 2024 Rating methodology Danske Bank’s rating Extraordinary Anchor Potential CRA** + 1 + 2 + 3 + 4 = = SACP* + external + ALAC*** = Issuer rating SACP* adjustment support A+ bbb+ +1 +1 0 0 0 a 0 +1 (
Slide 58: Danske Bank's ESG ratings – No changes in Q4 2024
Investor Presentation - FY2024 Danske Bank’s ESG ratings – No changes in Q4 2024 We have chosen to focus on four providers based on their importance to our investors ESG rating agency End-2024 End-2023 End-2022 End-2021 Range CDP1 B2 362 companies, out of the 21,000 B B B A to F (A highest rating) s
Slide 59: Tax & Material one-offs
Tax & Material one-offs Danske Bank 59
Slide 60: Tax
Investor Presentation - FY2024 Tax Actual and adjusted tax rates (DKK m) Tax drivers, Q4 2024 The actual tax rate of 25.3% (excluding prior- 2024 Q4 2024 Q3 2024 Q2 2024 Q1 2024 year's adjustments) is lower than the Danish rate of 26% - due to the differences in statuary tax Profit before tax accord
Slide 61: Material extraordinary items, 2023 – 2024
Investor Presentation - FY2024 Material extraordinary items, 2023 – 2024 Quarter One-off items Effect (DKK m) P&L line affected Q123 None Transaction costs and prudent valuation related to Personal Customers Norway -693 Other income Gain from sale of shares taken over in connection with a loan 327 T
Slide 62: Contacts
Investor Presentation - FY2024 Contacts Investor Relations Group Treasury and Funding Claus Ingar Jensen Mobile +45 25 42 43 70 Bent Callisen Mobile: +45 30 10 23 05 Head of IR clauj@danskebank.dk Interim Head of Group Treasury call@danskebank.dk Nicolai Brun Tvernø Mobile +45 31 33 35 47 Thomas Hal
Slide 63: Disclaimer for Danske Bank's Climate Progress Report 2024
Investor Presentation - FY2024 Disclaimer for Danske Bank’s Climate Progress Report 2024 Danske Bank’s Climate Progress Report 2024 has been prepared by Danske Bank A/S (“Danske Bank”). Danske Bank is under supervision by the Danish Financial Supervisory Authority (Finanstilsynet). The publication i
Slide 64: Disclaimer
Investor Presentation - FY2024 Disclaimer Important Notice This presentation does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation of an offer to buy or acquire securities of Danske Bank A/S in any jurisdiction, including the United States,