Denmark’s largest bank Danske Bank has presented a First Quarter pre-tax profit of DKK1.6billion and a net result of DKK0.8billion the bank says in its interim report.
The Q1 net result was an 11 per cent rise on Q1 2011 and was ‘generally in line with expectations’ the bank said in a statement.
"The Group’s earnings initiatives and tight cost control have improved the financial results of the banking units," says Eivind Kolding, Chairman of the Executive Board.
According to the report, income totalled DKK 12.4 billion, an increase of 6% from the level in the first quarter of 2011. This was mainly due to higher net interest and net trading income, the bank said
It added that the Group’s cost-savings programme, which was adopted last year to reduce costs by about DKK 2 billion and the headcount by about 2,000 from 2012 to 2014 was expected to be completed by the end of 2013.
At the same time, the bank announced it was introducing a new organisation to be structured around three business units – Personal Banking, Business Banking and Corporates & Institutions.
“The objectives are to improve the focus on customers and to lay the foundation for efficiency improvements and stronger financial performance,” the bank said, adding that changes would take effect from June 2012.
"The new organisation announced today is another step in the right direction to ensure that our business model is competitive and creates value," says Kolding, who took over the rudder at Danske Bank in February this year on the retirement of Peter Straarup.
The bank said it was addressing its troubled Irish operations by transferring the commercial and investment property loan portfolios at National Irish Bank into a new separate unit of the Group which would be “responsible for the controlled winding-up of this part of the loan portfolio”. But it added that the rest of its Irish banking activities would continue in their current form.
“The difficult market conditions persisted in several of our markets, though, and impairment charges remained high in the first quarter, even though they fell from the level in the fourth quarter of last year,” Kolding concluded.
The bank said that as part of its new strategy it would be using the Danske Bank name in all of its activities, including its Irish activities.
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