Investor Presentation - First Nine Months 2022
Investor Presentation - First nine months 2022
Danske Bank
Overall strong credit quality in portfolios exposed to current macro developments
CRE: Generally low exposure to property development
activities
DKK 296 bn in gross exposure and ECL ~1%
Agriculture: Well-provisioned agriculture book
DKK 65 bn in gross exposure of which 50% RD and
average stage 3 coverage ratio of 81% in Nordics
Retail customers: Strong household finances and
mortgage back-book mainly fixed rates for +5 years
45% of RD back-book are 30yr fixed-rate mortgages,
and of the variable rates ~70% are fixed for 5 years
RD back-book
Avg. LTV RD-retail
Segment gross exposure
■ Non-residential
■ Residential
Property dev.
55%
41%
47%
Country gross exposure
27%
Crops
■Dairy
Segment gross exposure
Pig breeding
■ Mixed operations
45%
38%
35%
56%
4%
33%
17%
15%
Country gross exposure
44%
0%
58%
15%
25%
0%
50%
100%
1% 1
Fixed F5s Other
■LTV Home equity
13%
7% 6%
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■ DK ■SE - NO ▪ FI ■ LC&I / Other
Historical lending growth modest (-4% 3Y-CAGR in
non-resi. since 01-19, +3% in resi.] given caps and
concentration limits within sub-segments and
markets, as well as for single-names, limiting
downside risks
Due to our conservative approach, our SE exposure
has remained stable, despite market growth, and
book is well-diversified with lower concentration risk
over the past years
The group's credit underwriting standards maintain
strong focus on cash flows, interest rate sensitivity,
LTV and the ability to withstand significant stress.
PMAs of DKK 1.3 bn made to cover uncertainties
regarding the affect of rapid interest rate increases
and macroeconomic situation
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■ DK SE = NO ■FI LC&I / Other
The credit quality of the portfolio has improved over
the past few years, recovering from legacy
exposures from the financial crisis
The current credit risk appetite takes into account
the volatility of the sector and remains in place.
Furthermore, the group maintains strong
underwriting standards on LTV, interest-only loans
and interest rate sensitivity
Post-model adjustments of DKK 0.8 bn have been
made for potential future portfolio deterioration due
to uncertainties such as African Swine Fewer (ASF),
Chinese imports and the RU/UA war
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Average LTVs have been decreasing over the past
year supported by increasing house prices and call
feature of DK mortgages
Affordability measures in our approval process
has been tightened, and debt-to-income (DTI) levels
remain stable overall
Portfolio uncertainty risks are being mitigated by
continuous monitoring and review of underwriting
standards covering interest rate-related stress of
affordability and other measures
Low near-term refinancing risk on RD flex loans.
Post-model adjustments related to personal
customers total DKK 1.4 bn
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