By Danske Bank, based in Copenhagen, reported a stronger-than-expected net profit for the second quarter, leading the bank to raise its full-year earnings guidance. The higher net profit was driven by increased net interest income and trading income.
Improved Financial Performance
- Net profit rose to 5.01 billion Danish kroner ($748.3 million) from DKK1.79 billion.
- Net interest income increased by 47% to DKK8.52 billion.
- Consensus estimates had projected net profit at DKK4.65 billion and net interest income of DKK8.5 billion.
- Danske Bank now anticipates a full-year net profit between DKK18.5 billion and DKK20.5 billion, compared to the previous range of DKK16.5 billion to DKK18.5 billion.
Future Outlook
- The bank expects continued growth in net interest income, while fee income is forecasted to be lower than the level in 2022.
- Projected costs for 2023 are estimated to be between DKK25 billion and DKK25.5 billion, including ongoing remediation costs of approximately DKK1.1 billion.
- Loan impairment charges of up to DKK1.5 billion are anticipated for this year.
Strengthening Financial Position
- Danske Bank’s common equity Tier 1 ratio, a crucial metric for assessing financial strength, increased to 18.1% from 17.1% compared to the previous year.
Interim Dividend
- The bank has decided to distribute an interim dividend of DKK7 per share.
The positive financial results reflect Danske Bank’s strong performance in the second quarter and demonstrate its commitment to enhancing shareholder value. With improved earnings guidance and an interim dividend, the bank continues to build a solid foundation for future growth.
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