Realkredit Danmark reports net profit of DKK 3,056 million
Realkredit Danmark today published its annual report for 2014. Highlights are shown below:
- In 2014, Realkredit Danmark recorded a net profit of DKK 3,056 million, against DKK 2,612 million the year before. The profit was 17% higher than in 2013 and in line with expectations. The profit benefited from lower impairments and a higher administration margin. The administration margin rose primarily because of an increase in the loan portfolio.
- Total income rose from DKK 5,800 million in 2013 to DKK 6,016 million, an increase of 4%.
- Expenses were down DKK 37 million and amounted to DKK 815 million.
- Impairments fell and amounted to DKK 1,171 million, against DKK 1,471 million in 2013. A general improvement of macroeconomic conditions in Denmark helped reduce impairments.
- In the second half of the year, Realkredit Danmark was able to offer customers fixed-rate loans with historically low interest rates, for example a 30-year mortgage loan funded by bonds with a coupon of 2.5%. Customer interest in the 2.5% fixed-rate loan was strong, and loans for DKK 15 billion were disbursed in 2014. In the last week of 2014, Realkredit Danmark also opened a 30-year loan funded by bonds with a coupon of only 2%.
- Customer interest in the FlexKort® loan was very strong, and loans for DKK 14 billion were disbursed in 2014.
- The proportion of customers with 1-year FlexLån® loans declined again in 2014. At the end of 2014, the portfolio of 1-year FlexLån® loans accounted for 13% of the total loan portfolio, which was 4 percentage points less than at end-2013. Customers continue to show strong interest in reducing interest rate sensitivity by setting their mortgage rates for longer periods.
- Overall, Realkredit Danmark expects a higher profit in 2015 than in 2014.
Annual Report 2014
Carsten Nøddebo, CEO, says: “The results for 2014 are satisfactory. An increase in activity in the housing and property markets and a strengthening of our market position contributed to the improvement of our results. It is also positive that we achieved a significant decline in impairments. The lower interest rates on mortgage loans and moderate economic growth combined to have a positive effect on the financial situation of our customers.”
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.