Posted on Thursday 31 October 2013 by Ulster Business
The Danish owned bank posted a pre-tax profit of £1.4m for the first nine months of 2013 after recording a second consecutive quarter back in profit. That compared to a £35.5m loss over same period in 2012.
The bank, like most of the other local institutions, has been operating at a loss through the recession and the upturn is likely to be seen as a positive indication that the number of impaired loans - debts which are unlikely to be paid back to their full value - is falling.
Danske said impairment charges to the end of September had reduced by 66% to £41m from over £120m in the same period a year earlier.
The lender said overall loan balances fell by 4% year on year and deposit balances are 12% higher, with the bank’s overall deposit to loans ratio remaining above 100%.
Head of Danske Bank UK & Ireland Gerry Mallon said: “I am pleased to report a significantly improved financial performance for the second consecutive quarter, resulting in a pre-tax profit of £1.4m for the year to date. We are firmly on the right track for future growth of Danske Bank inNorthern Ireland.
“As a leading retail bank our financial performance is a bellwether of the wider economy and our latest results certainly indicate that consumer and business confidence is beginning to return.
“The underlying performance of the business has continued to improve over the quarter. Income is holding steady and costs, while under constant review, are well under control. Whilst it is encouraging to see impairment charges tracking downwards, we continue to make a cautious assessment of the valuation of impaired assets in the current property market.”
Mr Mallon said Danske’s business banking division had performed well and it was starting to see increase investment activity within its customer base.
“Looking to the broader picture, all the economic indicators both nationally and locally are pointing in the right direction. Recovery is still fragile and impairments tend not to happen in a linear way; however given our own steady road to recovery I remain very confident about the development of our business performance and that of the local economy,” he said.
Danske Bank Group also said it is to refocus its business in the Republic of Ireland on Corporates & Institutions customers, and will stop offering personal and business banking services to new customers.
Existing personal and business banking customers will be transferred to the bank's Non-core unit for servicing and winding down.
The closure of those operations could result in as many as 150 redundancies, the bank confirmed.
"We will take the steps necessary to support our customers in this process. Our activities in Northern Ireland are not affected by this decision and will remain part of our core business," the company said in a statement.