Press conference Peter Straarup CEO 10 February 2011 y - - PowerPoint PPT Presentation

ANNUAL REPORT 2010

Press conference

Peter Straarup

CEO

10 February 2011 y

Disclaimer

Important Notice This presentation does not constitute or form part of and should not be construed as an offer to sell or issue or the solicitation of an This presentation does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation of an

• ffer to buy or acquire securities of Danske Bank A/S in any jurisdiction, including the United States, or an inducement to enter into

investment activity. No part of this presentation, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. The securities referred to herein have not been, and will not be, registered under the Securities Act of 1933, as amended, and may not be offered, exercised or sold in the United States absent registration or an applicable exemption from registration requirements. References to a potential share offering by Danske Bank are g pp p g q p g y included herein pursuant to Rule 135c of the Securities Act of 1933, as amended. This presentation contains forward-looking statements that reflect management’s current views with respect to certain future events and potential financial performance. Although Danske Bank believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, results g p p g y could differ materially from those set out in the forward-looking statements as a result of various factors many of which are beyond Danske Bank’s control. This presentation does not imply that Danske Bank has undertaken to revise these forward-looking statements, beyond what is required by applicable law or applicable stock exchange regulations if and when circumstances arise that will lead to changes compared to the date when these statements were provided.

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Net profit reflects improved economic environment; f h b id i l d i h i prepayment of hybrid capital and right issue

N fi DKK 3 7 b

• Net profit was DKK 3.7 bn
• The expiry of Bank Package I gives better earnings capacity
• New lending to Danish customers remains high
• IT initiatives with new mobile banking solutions a big success
• Asked for permission to prepay hybrid capital
• Rights issue planned for first half of 2011
• Rights issue planned for first half of 2011
• No dividend paid for Q4 2010
• Improvement in earnings expected to continue in 2011

3

Profit of DKK 3.7 bn DKK in 2010 after expected d li i i

DKK m 2009 2010 Index

decline in income

Net interest income 27,524 23,843 87 Net fee income 7,678 8,510 111 Net trading income 18 244 7 921 43 Net trading income 18,244 7,921 43 Other income 3,083 3,857 125 Income from insurance 2,810 2,146 76 Total income 59,339 46,277 78 Operating expenses 24,949 24,135 97 Goodwill imp & Bk Package I 3 958 1 875 47 Goodwill imp & Bk Package I 3,958 1,875 47 Profit bef. loan imp. charges 30,432 20,267 67 Loan impairment charges 25,677 13,817 54 Profit before tax 4,755 6,450 136 Tax 3,042 2,786 92 N fi 1 713 3 664 214 Net profit 1,713 3,664 214

4

Net trading income back at more normal level; i k d f uncertain markets at end of year

DKK m 2009 2010 Index Net interest income 27,524 23,843 87 Net fee income 7,678 8,510 111

50 55

bp Danish 30-year mortgage bond spread Net trading income 18,244 7,921 43 Other income 3,083 3,857 125 Income from insurance 2,810 2,146 76

35 40 45

Total income 59,339 46,277 78 Operating expenses 24,949 24,135 97 Goodwill imp & Bk Package I 3,958 1,875 47 P fi b f l i h 30 432 20 267 67

25 30 35

Profit bef. loan imp. charges 30,432 20,267 67 Loan impairment charges 25,677 13,817 54 Profit before tax 4,755 6,450 136 Tax 3 042 2 786 92

15 20 0-12 0-03 0-06 0-09 1-12

Tax 3,042 2,786 92 Net profit 1,713 3,664 214

30 30 30 30 31 5

Net interest income declines because of lower i d i i f di interest rates and rising funding costs

DKK m 2009 2010 Index Net interest income 27,524 23,843 87 Net fee income 7,678 8,510 111 % Danish central bank’s deposit rate 1,0 Net trading income 18,244 7,921 43 Other income 3,083 3,857 125 Income from insurance 2,810 2,146 76 Total income 59,339 46,277 78 Operating expenses 24,949 24,135 97 Goodwill imp & Bk Package I 3,958 1,875 47 f f 0,5 Profit bef. loan imp. charges 30,432 20,267 67 Loan impairment charges 25,677 13,817 54 Profit before tax 4,755 6,450 136 T 3 042 2 786 92 0,0 2 2 4 6 8 2 Tax 3,042 2,786 92 Net profit 1,713 3,664 214 31-12 28-02 30-04 30-06 31-08 31-10 31-12

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Insurance: Strong premium growth; results remain d sound

DKK m 2009 2010 Index Net interest income 27,524 23,843 87 Net fee income 7,678 8,510 111 DKK bn Premium income

• market products

20 Net trading income 18,244 7,921 43 Other income 3,083 3,857 125 Income from insurance 2,810 2,146 76 15 Total income 59,339 46,277 78 Operating expenses 24,949 24,135 97 Goodwill imp & Bk Package I 3,958 1,875 47 P fi b f l i h 30 432 20 267 67 5 10 Profit bef. loan imp. charges 30,432 20,267 67 Loan impairment charges 25,677 13,817 54 Profit before tax 4,755 6,450 136 Tax 3 042 2 786 92 5 06 07 08 09 Tax 3,042 2,786 92 Net profit 1,713 3,664 214 200 200 200 200 201

7

Large decline in expenses that more than offsets d i i fl i wage and price inflation

DKK m 2009 2010 Index Net interest income 27,524 23,843 87 Net fee income 7,678 8,510 111 30 Expenses DKK bn Net trading income 18,244 7,921 43 Other income 3,083 3,857 125 Income from insurance 2,810 2,146 76 26 28

Goodwill write-offs + Bank Package I

Total income 59,339 46,277 78 Operating expenses 24,949 24,135 97 Goodwill imp & Bk Package I 3,958 1,875 47 P fi b f l i h 30 432 20 267 67 24 26

• 3%

g fee Bank Package I fee

• 10%

Profit bef. loan imp. charges 30,432 20,267 67 Loan impairment charges 25,677 13,817 54 Profit before tax 4,755 6,450 136 T 3 042 2 786 92 22 Tax 3,042 2,786 92 Net profit 1,713 3,664 214 20 2009 2010

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Loan impairment charges: Dominated by business t hil l t b tt customers, while personal customers manage better

DKK m 2009 2010 Index Net interest income 27,524 23,843 87 Net fee income 7,678 8,510 111 16 DKK bn Impairment charges by customer type Net trading income 18,244 7,921 43 Other income 3,083 3,857 125 Income from insurance 2,810 2,146 76 10 12 14 Personal

Distressed banks

Total income 59,339 46,277 78 Operating expenses 24,949 24,135 97 Goodwill imp & Bk Package I 3,958 1,875 47 P fi b f l i h 30 432 20 267 67 6 8 10 Profit bef. loan imp. charges 30,432 20,267 67 Loan impairment charges 25,677 13,817 54 Profit before tax 4,755 6,450 136 T 3 042 2 786 92 9 2 4 6 Business & financial Tax 3,042 2,786 92 Net profit 1,713 3,664 214 2

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Impairment charges highest in Ireland, but fall dil steadily every quarter

10 bp DKK bn

Impairment charges/ lending 2010 Impairment charges by quarter

800 8 400 600 6 200 400 2 4

• 200

Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10

• 400

reland reland altics nmark nland Other weden

• rway

arkets 10 Ir

• N. Ir

B Den Fi Sw No Ma

Results in our main markets show a profit at five f i

• ut of seven units

Profit before tax 2010 2 500 4.000 Ex fees for Bank Package I DKK m 500 1.000 2.500

• 2.000
• 500
• 5.000
• 3.500

Denmark Norway Sweden Finland Baltics Northern Ireland y Ireland

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Lending stable, while deposits continue positive d trend

1,000 1.800 DKK bn Lending DKK bn Deposits 600 800 1.600 200 400 1.200 1.400 200 9 9 1.000 9 9 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Banking Activities Danske Markets Q3 0 Q4 0 Q1 1 Q2 1 Q3 1 Q4 1

Note: Decline in Q1 2010 because of release of large deposit custody account with Danske Markets.

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New era for the Danske Bank Group

• Easiest, quickest service • Best-qualified solutions

Personal customers

Best qualified solutions • Competitive prices

Personal customers

• Fast service • Direct access to specialists

SMEs

• Best choice for Nordic customers

Medium-sized companies & private banking & private banking

L d i t t d • Leader in asset management and capital markets services

Large corporates

13

Denmark’s first mobile banking for smartphones

14

Danske mobile banking

15

More and more customers choose digital delivery of d t documents

66% 67% 74% 70% 72%

Dec 2009 Percentage of personal customers who receive documents in digital form

45% 46%

Dec 2010

45% 42% 26% 17% 15% 18%

Sweden

16

No cases lost at Danish Complaints Board in 2010

415 450 350 400 100% 250 300 150 200 42 50 100 50 Total judgements Judgements involving D k B k Judgements against Danske B k 10% Danske Bank Bank

17

Strong product range achieves recognition

Best private banking in Denmark One of Denmark’s least Best private banking in Denmark Best private banking in Norway expensive banks over a lifetime No 1 unit trust group for equities Best stockbroker in Denmark

• No. 1 unit trust group for equities
• third consecutive year

Best stockbroker in Denmark

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Customer satisfaction on the rise

Customer satisfaction in Denmark Customer satisfaction in Denmark Index

75 275.3 76 74.1 74.4 75.275.3 74 73.0 73.0 72.9 72 1 72 0 72 70.7 70.6 71.1 72.1 72.0 70 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10

19

Q Q Q Q Q Q Q Q Q Q Q Q

Capital ratios improved; Rights issue planned and ibili f f h b id i l

20

possibility of prepayment of hybrid capital

% Capital ratios

14 1 17,8 14,8 17,7

15 20

• Core tier 1 and solvency

improved in 2010

9,5 14,1 10,1

10 15

• Asked for permission to prepay

hybrid capital in 2012

• Planning a rights issue of DKK 20

5

bn *

• AP Møller Mærsk and Realdania

support the rights issue

Core tier 1 % Tier 1 % Total capital %

• Become one of the best

capitalised banks in the EU

Core tier 1 % Tier 1 % Total capital % 2009 2010

*This presentation does not constitute an offer to sell, or a solicitation of offers to purchase or subscribe for,

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securities in the United States. The securities referred to herein have not been, and will not be, registered under the Securities Act of 1933, as amended, and may not be offered, exercised or sold in the United States absent registration or an applicable exemption from registration requirements. This notice is issued pursuant to Rule 135c of the Securities Act of 1933, as amended

Improving macroeconomic situation, but growth is still modest and uncertain still modest and uncertain

4 8 %

GDP growth

4

• 8
• 4

Ireland Sweden Denmark Euroland Norway

• 12

8

Baltics Ireland Finland

• 16

2009 2010 2011E 2012E

Baltics Source: Danske Research (December 2010). 21

Outlook: Recovery of Danske Bank’s earnings i i i 2011 capacity to continue in 2011

Moderate economic growth Moderate economic growth Robust income from banking activities g Lower income from Danica, while Danske Markets’ and Danske Capital’s i d d k d l earnings depend on market developments Expenses are expected to decline in 2011 Increased attention on customer service and continuing focus on costs Increased attention on customer service and continuing focus on costs Loan impairment charges lower than in 2010 A gradual improvement in overall results

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wwwdanskebank com/ir

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www.danskebank.com/ir