Danske Bank reports 'strong' financial results despite dramatic fall in pre-tax profits
DANSKE Bank in Northern Ireland has reported a 45 per cent slump in pre-tax profits for the first three months of the year, according to its latest financial results.
Danske reported profit before tax of £15.1 million in the first quarter of 2018, a dramatic fall on the £27.3m recorded at the beginning of the previous year. The reduction is down to a increase in loan impairment charges in an otherwise "strong" set of results.
Danske reported an operating profit before loan impairments of £22.4m for the first three months of the year, an 11 per cent increase on the corresponding period in 2017 (£20.2m). Lending also grew by 9 per cent year-on-year and deposits increased by 6 per cent, which contributed to a 2 per cent rise in total income, jumping from
£55.8m to £56.6m in 12 months. Within personal banking the bank recorded a 35 per cent uplift in mortgage lending, while Danske continues to have capacity to support further lending growth as demonstrated by a loan to deposit ratio of 77 per cent as at March 2018.
Danske Bank UK CEO, Kevin Kingston said he was "pleased" with the latest set of financial results.
"The underlying performance of the bank continues to be strong, with lending up 9 per cent year-on-year," he said.
He cited the 35 per cent increase in new mortgage lending as one of the major positives in the figures.
"Our mortgage product proposition is strong, and will be further improved in the coming weeks with the introduction of a very competitive remortgage offer to encourage more switchers," he said.
Mr Kingston further highlighted the increase of 4 per cent year-on-year in business lending, with notable corporate deals including funding support for SHS Group's acquisition of 3V Natural Foods and support for the expansion of Weavers Court Business Park in Belfast - helping to create an additional 40,000 square foot of Grade A office space.
The "digital transformation agenda" also continues at pace at Danske Bank, who are currently building a new mobile banking app, due to be ready for customers in the coming months.
Danske Bank, part of the Nordic Danske Bank Group, is one of the north's leading financial institutions, operating 44 branches and three regional business centres. It employs around 1,400 staff serving personal, business and corporate customers.
Danske Bank Group recorded a net profit of DKK 4.9 billion (£570m) in the first quarter of 2018, a decrease of 12 per cent from the level recorded in the first three months of 2017. Danske Bank Group chief excecutive officer, Thomas F. Borgen described it as a "satisfactory" start to the year, "despite financial market developments that caused lower activity compared with the same period last year".