Press conference Peter Straarup, CEO & Chairman of the - PowerPoint PPT Presentation

INTERIM REPORT – FIRST HALF 2010 Press conference Peter Straarup, CEO & Chairman of the Executive Board Tonny Thierry Andersen, CFO & member of the Executive Board August 10, 2010

Financial results for H1 2010: Earnings growth continues DKK m H1 2009 H1 2010 Index Net interest income 14,134 11,934 84 Net fee income 3,683 4,116 112 Net trading income 12,397 5,196 42 Other income 1,508 2,141 142 Income from insurance 561 756 135 Total income 32,283 24,143 75 Operating expenses 13,968 13,259 95 Goodwill impairment 1,417 0 - Profit bef. loan imp. charges 16,898 10,884 64 Loan impairment charges 14,531 7,752 53 Profit before tax 2,367 3,132 132 Tax 1,642 1,426 87 Net profit 725 1,706 235 2

Macroeconomic indicators improve, but growth is still fragile % GDP growth 8 4 0 Norway Euroland -4 Denmark Sweden Ireland -8 Finland -12 Baltics -16 2009 2010E 2011E Source: Danske Research (July 2010). 3

Danske Bank did well in EU stress test, with capital far above the requirement Tier 1 ratio 14.1% Full CRD 13.1% implementation 12.1% Transitional 11.7% DKK 55 bn 10.8% CRD rules under full 10.0% DKK 40 bn Basel II in excess capital 6% Minimum requirement Actual result Adverse scenario Adverse scenario End-2009 End-2011 + additional sovereign shock End-2011 4

Revised Basel III proposal is a step in the right direction, but there are still some issues • Revised proposal from the Basel committee has addressed criticism from banks • The proposal is favourable for Danske Bank, but • Key concerns around the treatment of the unique Danish mortgage market have not been resolved 5

Danske Bank’s payments for Bank Package I Bank Package I E x p e n s e s t h u s f a r Guarantee fees 4.4 Provisions made to Financial Stability 2.9 Total DKK 7.2 bn 6

Stronger customer focus and a more efficient bank 7

Customers like the digital signature and adopt it very quickly Agreements with digital signature in eBanking (Denmark) 14,000 12,000 10,000 8,000 40% of digitalised agreements 6,000 are signed online 4,000 2,000 0 1.4.09 1.5.09 1.6.09 1.7.09 1.8.09 1.9.09 1.1.10 1.2.10 1.3.10 1.4.10 1.5.10 1.6.10 1.10.09 1.11.09 1.12.09 8

Business Direct: A new advisory programme for smaller enterprises What is your opinion of Business Direct? Advisory services on 70 13 30 00 Mon-Wed 7.30-18.00 Thur 7.30-21.00 Fri 7.30-16.00 8% 25% 67% Positive Neutral Negative 9

Customer satisfaction on the rise and now above 2008 level Customer satisfaction in Denmark Index 76 74.4 73.0 74.1 72.9 73.0 72 72.1 72.0 70.7 71.1 70.6 68 64 Q1 08 Q2 08 Q3 08 Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 10

Income declines 25%, as expected DKK m H1 2009 H1 2010 Index Net interest income 14,134 11,934 84 Net fee income 3,683 4,116 112 Net trading income 12,397 5,196 42 Other income 1,508 2,141 142 Income from insurance 561 756 135 Total income 32,283 24,143 75 Operating expenses 13,968 13,259 95 Goodwill impairment 1,417 0 - Profit bef. loan imp. charges 16,898 10,884 64 Loan impairment charges 14,531 7,752 53 Profit before tax 2,367 3,132 132 Tax 1,642 1,426 87 Net profit 725 1,706 235 11

Trading income falls to a more normal level, although markets were volatile in Q2 bp Spreads, Danske 30- DKK m H1 2009 H1 2010 Index year mortgage bond Net interest income 14,134 11,934 84 45 Net fee income 3,683 4,116 112 Net trading income 12,397 5,196 42 40 Other income 1,508 2,141 142 35 Income from insurance 561 756 135 Total income 32,283 24,143 75 30 Operating expenses 13,968 13,259 95 25 Goodwill impairment 1,417 0 - Profit bef. loan imp. charges 16,898 10,884 64 20 Loan impairment charges 14,531 7,752 53 15 Profit before tax 2,367 3,132 132 30-12 30-01 28-02 31-03 30-04 31-05 30-06 Tax 1,642 1,426 87 Net profit 725 1,706 235 12

Net interest income declines because of lower interest rates and higher funding costs % Danish central bank’s DKK m H1 2009 H1 2010 Index policy rate Net interest income 14,134 11,934 84 2.0 Net fee income 3,683 4,116 112 Net trading income 12,397 5,196 42 1.5 Other income 1,508 2,141 142 Income from insurance 561 756 135 1.0 Total income 32,283 24,143 75 Operating expenses 13,968 13,259 95 0.5 Goodwill impairment 1,417 0 - Profit bef. loan imp. charges 16,898 10,884 64 Loan impairment charges 14,531 7,752 53 0.0 30-06 31-08 31-10 31-12 28-02 30-04 30-06 Profit before tax 2,367 3,132 132 Tax 1,642 1,426 87 Net profit 725 1,706 235 13

Insurance: High premium growth and rising earnings despite difficult investment markets DKK m H1 2009 H1 2010 Index Net interest income 14,134 11,934 84 Income growth of DKK 200m Net fee income 3,683 4,116 112 Net trading income 12,397 5,196 42 Other income 1,508 2,141 142 Income from insurance 561 756 135 Total income 32,283 24,143 75 Premium growth of 25% Operating expenses 13,968 13,259 95 Goodwill impairment 1,417 0 - Profit bef. loan imp. charges 16,898 10,884 64 Loan impairment charges 14,531 7,752 53 Investment return of Profit before tax 2,367 3,132 132 5.4% (Traditionel) and Tax 1,642 1,426 87 3.7% (Balance & Link ) Net profit 725 1,706 235 14

Large reduction of expenses more than offsets salary and price inflation Expenses DKK bn DKK m H1 2009 H1 2010 Index 16 Net interest income 14,134 11,934 84 Net fee income 3,683 4,116 112 Net trading income 12,397 5,196 42 Goodwill impairment Other income 1,508 2,141 142 charges 14 Income from insurance 561 756 135 -5% Total income 32,283 24,143 75 Operating expenses 13,968 13,259 95 Goodwill impairment 1,417 0 - Profit bef. loan imp. charges 16,898 10,884 64 12 Loan impairment charges 14,531 7,752 53 Profit before tax 2,367 3,132 132 Tax 1,642 1,426 87 Net profit 725 1,706 235 10 H1 2009 H1 2010 15

Loan impairment charges: Dominated by business customers, while personal customers manage fairly well DKK bn Impairment DKK m H1 2009 H1 2010 Index charges broken 9 Net interest income 14,134 11,934 84 down by customer Net fee income 3,683 4,116 112 type 8 Net trading income 12,397 5,196 42 Distressed banks 7 Other income 1,508 2,141 142 Personal 6 Income from insurance 561 756 135 Total income 32,283 24,143 75 5 Operating expenses 13,968 13,259 95 4 Goodwill impairment 1,417 0 - Profit bef. loan imp. charges 16,898 10,884 64 3 5.1 Business & Loan impairment charges 14,531 7,752 53 2 financial Profit before tax 2,367 3,132 132 1 Tax 1,642 1,426 87 Net profit 725 1,706 235 0 16

Impairment charges are highest in Ireland, but are declining steadily from quarter to quarter bp Impairmentcharges/ lending DKK bn Impairmentcharges by H1 2010 quarter 10 800 600 8 400 6 200 4 0 2 -200 -400 0 Norway Ireland Baltics N. Ireland Denmark Other Finland Sweden Markets Q4 08 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 17

Results for our primary markets show a profit in five of seven countries DKK m Profit before tax, H1 2010 Ex expenses for Bank Package I 1,000 0 -1,000 -2,000 -3,000 Norway Denmark Sweden Finland Baltics N. Ireland Ireland 18

Lending is increasing again, mainly in the Nordic region; deposits continue underlying positive trend Lending Deposits DKK bn DKK bn 1,800 1,000 800 1,600 Private 600 Finansielle 1,400 400 1,200 200 Erhverv 1,000 0 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q1 09 Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Banking Activities Danske Markets Note: Drop in deposits in Q110 owing to release of 19 large deposit account at Danske Markets.

Liquidity has improved further in 2010, and funding need for 2010 has already been met DKK bn 450 300 End of June 2010 150 Positive 36 mos. End-2008 End-2009 0 -150 1 week 2 weeks 3 weeks 1 month 2 months 3 months 4 months 5 months 6 months 9 months 12 months 20

Capital and solvency ratios improved significantly DKK 62 bn buffer % Capital ratios above ICAAP result 20 H1 09 H1 10 15 10 5 0 Tier 1 ratio Solvency ratio 21

Outlook: Moderate economic growth, but 2010 will remain a challenging year Moderate economic growth Expiry of Danish state guarantee on October 1 reduces expenses by about DKK 1 bn per quarter Robust income from Banking Activities Lower income from Danske Markets and Danica Expenses expected to be lower than in 2009 Increased focus on customer service and continuing focus on costs Impairment charges lower than in 2009, but still high 22

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