Net profit of DKK 1,290 million for the first nine months of 2011
Realkredit Danmark today published its interim report for the first nine months of 2011. Highlights are shown below:
- The Realkredit Danmark Group recorded a net profit of DKK 1,290 million in the first nine months of 2011, against DKK 1,395 million in the same period of 2010. The overall profit was in line with expectations and reflected higher funding costs and lower income from the investment portfolio.
- Higher income from the investment portfolio contributed to a healthy increase in profits in the third quarter.
- Total income fell 5% relative to the first nine months of 2010 and amounted to DKK 3,165 million.
- Loan impairment charges totalled DKK 739 million in the first nine months of 2011. In the same period of 2010, charges totalled DKK 808 million. Also at 30 September 2011, the charges corresponded to 0.14% p.a. of total mortgage lending.
- Expenses climbed DKK 45 million to DKK 705 million. The increase was caused, among other things, by higher IT expenses resulting from the implementation of measures aimed at facilitating customer service and making it more efficient.
- The 3-month delinquency rate stood at 0.48% after the third quarter, down from 0.57% after the second quarter.
- At 35.8%, Realkredit Danmark's total capital ratio calculated according to the Capital Requirements Directive remained very high. At the end of 2010, the ratio was 39.4%.
- Because of the rise in funding costs, Realkredit Danmark has announced that it will raise administration margins for personal customers with effect from 1 January 2012. In the business customer segment, administration margins will be adjusted according to market developments.
- Profit expectations for the full year 2011 are unchanged.
Report for the first nine months of 2011 (pdf)
Carsten Nøddebo, CEO, says:
“The housing market is still sluggish, and funding costs are rising. Despite the low level of activity, we have been able to strengthen our market position in both the personal customer and the business customer segments. The coming period will see continued economic uncertainty, but at the same time, home owners have a unique opportunity to fix the interest rate on loans at a low level for a long period of time, or, alternatively, exploit the low interest rates to reduce the outstanding debt.”
Contact: Carsten Nøddebo, CEO, tel. +45 45 13 20 82.
This is a translation of a press release in the Danish language. In case of discrepancies, the Danish version prevails.
