“We delivered a strong financial result for 2017,” says Thomas F. Borgen, Chief Executive Officer. “The result reflects continued progress in the Nordic economies, a high level of customer activity throughout the year and our business initiatives aimed at creating a more simple, efficient and customer-centric bank. We experienced a positive development across our business units, which in many areas led to good increases in the number of customers and lending. We continuously strive to improve the customer experience and we have generally maintained the positive trend in customer satisfaction across our markets. Digitalisation increasingly creates new possibilities, and the result for 2017 gives us a good basis for continuing to invest in the development of new solutions for the benefit of our customers.”
2017 was a satisfactory year for Danske Bank, and we posted a net profit of DKK 20.9 billion, against DKK 19.9 billion in 2016. The return on shareholders’ equity after tax was 13.6%, against 13.1% in 2016. The result reflects a positive macroeconomic environment and higher customer activity. Improved customer solutions and a number of product launches supported the result.
The results show that our strategy of becoming an even more customer-focused, simple and efficient bank continued to yield results. Customer satisfaction is a key priority for us, and we are in a good position in most markets. We are working hard to constantly improve the customer experience.
In 2017, we continued to progress in terms of realising our Nordic potential. At Personal Banking, we saw further growth driven mainly by our partnership agreements in Sweden and Norway, and we had stable positions in Denmark and Finland. At Business Banking, we grew lending across markets and maintained our position as a leading bank for small and medium-sized businesses in the Nordic region. Corporates & Institutions and Wealth Management benefited from good customer activity and the positive development in the financial markets. Assets under management were 8% higher than in 2016.
In December 2017, Danica Pension announced the acquisition of SEB Pension in Denmark. Through economies
of scale, the transaction will make Danica Pension even more competitive and strengthen its innovation capacity to the benefit of our pension customers. The acquisition is subject to approval by relevant authorities, which is expected in the first half of 2018.
Total income was at the same level in 2017 as in 2016. Net interest income increased from the level in 2016, driven mainly by lending growth of 2% in 2017. Net fee income increased, driven by customer activity and positive market developments. Trading income and other income decreased from the 2016 level, which included several large one-off items.
Operating expenses were broadly flat in 2017. Expenses were affected by higher costs related to compliance, regulation and digitalisation. We invested significant resources in implementing regulatory requirements regarding, for example, financial instruments (MiFID II), data protection (GDPR), payment services (PSD2) and antimoney laundering. Higher activity-related costs were for a large part mitigated by efficiency measures.
Credit quality remained strong, and we saw net impairment reversals driven by improving macroeconomic conditions and higher collateral values in 2017. With a return on shareholders’ equity of 13.6% in 2017, we delivered ahead of plan on our ambition of at least 12.5% in 2018 at the latest.
Re-disseminated by The Asian Banker