Danske Bank (DANSKE) Pre-Close Call summary

Executive summary

• Q1 2025 pre-close call focused on macroeconomic trends, P&L lines, and capital updates.

• Nordic economies saw declining inflation, improved GDP growth, and robust labor markets, especially in Denmark.

• Geopolitical uncertainty and global trade tensions have increased, impacting consumer sentiment and credit demand.

Trading performance and revenue trends

• Lending volumes showed modest improvement, but credit demand remains cautious in housing and corporate sectors.

• Deposit rates and lending rates were adjusted in line with central bank policy rate cuts in Denmark and Sweden.

• Net interest income (NII) is expected to be lower this year due to lower rates, with positive impact from hedges.

• Fee income is influenced by seasonality in performance fees and ongoing customer activity; Q1 performance fees were DKK 10 million.

• Trading income affected by elevated market volatility and defensive investor behavior.

Profitability and margins

• NII sensitivity remains at DKK 500 million per 25bps parallel move, with additional effects in years two and three.

• Performance fees are highly seasonal, with significant Q4 impact but minimal in Q1.

• Insurance net income in Q1 will see a DKK 0.2 billion one-off provision for a legacy pension product.

• Other income is expected to decline due to lower asset values in the leasing business, especially for electric vehicles.