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THE BIZNOB – Global Business & Financial News – A Business Journal – Focus On Business Leaders, Technology – Enterpeneurship – Finance – Economy – Politics & LifestyleTHE BIZNOB – Global Business & Financial News – A Business Journal – Focus On Business Leaders, Technology – Enterpeneurship – Finance – Economy – Politics & Lifestyle

Finance

Finance

Danske Bank sets profit target, sells Norway retail unit

A person rides a bicycle past a Danske Bank branch in Copenhagen, Denmark, July 29, 2022. REUTERS/An... A person rides a bicycle past a Danske Bank branch in Copenhagen, Denmark, July 29, 2022. REUTERS/Andrew Kelly/File Photo
A person rides a bicycle past a Danske Bank branch in Copenhagen, Denmark, July 29, 2022. REUTERS/An... A person rides a bicycle past a Danske Bank branch in Copenhagen, Denmark, July 29, 2022. REUTERS/Andrew Kelly/File Photo

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Danske Bank sets profit targets and sells Norway retail units. On Wednesday, Danske Bank (DANSKE.CO) upped its long-term earnings target and announced intentions to sell its Norwegian retail division to catch up with more successful Nordic rivals.

Denmark’s largest lender targets a 13% return on equity (ROE) by 2026, up from 8.5% to 9%, and a cost-income ratio of 45%, down from the mid-50s.

“Danske Bank has during recent years made fundamental changes to refocus the bank, reduce our risk exposure, develop our organization and accelerate our commercial momentum,” stated CEO Carsten Egeriis.

In recent years, Danske has invested heavily in anti-money laundering and digital technologies, lagging behind its Nordic competitors in earnings.

Swedbank (SWEDa.ST) and rival Nordic banks Nordea (NDAFI.HE) and DNB (DNB.OL) have long-term ROE targets of at least 15%.

Danske indicated it would focus on large Nordic corporations instead of Norwegian retail customers. The owner search was “well-progressed,” it claimed.

According to regulatory data, Danske Bank is Norway’s third-largest bank after DNB and Nordea.

Danske has pledged to quadruple its strategic development efforts in digital platforms, expert consulting services, and sustainability.

Danske said its revised financial targets assume 3% loan growth and less than 1% deposit growth.

Danske paid no dividend for 2022 due to a $2 billion settlement in the US and Denmark over a large money-laundering scam and said it would resume dividend payments when it releases first-half 2023 results in July.


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