Danske posts pre-tax profit for 2013

Gerry Mallon jacket offDanske Bank in Northern Ireland reports a pre tax profit of £11.4m for the full year 2013. The outcome has been driven by reduced impairment charges alongside improved underlying business performance.

Excluding a one-off pension accounting gain in 2012 (Other income), underlying operating income increased by 4% year on year. Whilst lending volumes fell by 2%, deposit balances are 9% higher than the same period last year, with the Bank’s overall deposit to loans ratio maintained well above 100%.

Total costs are reported higher year on year due to the inclusion of a number of exceptional items in both 2012 and 2013. The underlying cost base is falling as the Bank continues to work hard to manage its expenditure.

Impairment charges are significantly lower than in the same period last year.  As at 31st December 2013, the Bank’s solvency ratio stood at 21.3% and tier 1  capital ratio at 14.3%.

Commenting on the results, Danske Bank UK CEO Gerry Mallon said: “I am pleased to report that the Bank’s first full year trading as Danske Bank proved to be a significant one, resulting in a return to profit of over £11 million for the year.

“A substantial fall in impairments coupled with a strong focus on the fundamentals of our business resulted in a return to profit last year, our first profitable year since the start of the financial crisis.

“A continued focus on developing our products and services to meet customers’ needs coupled with our appetite and capacity to lend has resulted in a strong business performance.

“The changing habits and expectations of consumers continued to drive changes to the branch network and sustained investment in digital banking channels. The uptake of our banking apps over the past year has been phenomenal with over two million logons to our online services now recorded every month. This record growth is
clearly demonstrating the increasing demand from customers for more convenient ways to conduct their day-to-day business.

“In 2013 we continued to focus on a wide range of offers to support homebuyers and help stimulate the mortgage market. Competitive offers during the year made Danske Bank mortgages more attractive for those looking for value. The first time buyer market was also supported with finance of up to 95% provided along with discounted
fees and cash back offers demonstrating our appetite for mortgage lending.

“Business Banking continues to go from strength to strength. In 2013 even more good trading businesses moved to Danske Bank with the level of new customer acquisition amongst the highest levels seen in recent years. 2013 was also a record year for lending with over £450 million in new and increased lending provided to business customers, a figure that represents an increase of 50% year on year and of which almost half was to ‘new to bank’ customers.

“With a continuing strong customer focus, satisfaction levels have remained high in 2013 and are above the competitor average.

“Danske Bank has a significant role to play in growing Northern Ireland’s economy. Our improving results in 2013 demonstrate our ability to support both personal and business customers. We have started 2014 in a strong position from which to deliver future growth as the economic recovery continues.”

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