BankNordik P/F - Financial Statement Release

BankNordik maintains half-year result at DKK 49 million

The Bank continues to have a strong capital base, solid deposit sur-plus and
good liquidity 

At the half-year turn, BankNordik received 90,000 customers, 13 branches and
200 employees from Amagerbanken 

The Board of BankNordik has approved the financial statements for the first
half of 2011. It shows a profit of DKK 49 million before value adjustments and
tax against DKK 51 million in the same period last year (excl. extraordinary
profit from sale of stock in Bakkafrost) 

The demand for new loans remains relatively weak and previous loans are
redeemed. Thus, the Bank's lending and earnings from these activities have
receded a little. 

In August 2011, BankNordik has raised interest rates generally by 0.5
percentage point and has launched various initiatives regarding the internal
organization and reduction of costs. Thus, branches both in the Faroe Islands
and in Denmark have been merged. The interest costs and risk of revaluation are
reduced by further redemption of external funding in the second half of 2011. 

Strategic expansion

With the acquisition of the healthy parts of Amagerbanken from July this year
and a number of former Sparbank branches last year BankNordik increased its
activities in Denmark significantly. The activities are located in all the
major growth areas, including Copenhagen, Aarhus, Odense and Mid-Jutland. At
the same time, BankNordik achieved a better geographical and industrial risk
diversification and increased its deposit surplus significantly - an important
factor in times when other banks are experiencing difficulty obtaining
financing. 

“We are very pleased to welcome 90,000 new customers, who have gone through a
period of uncertainty. BankNordik is a strong bank with good solvency and
liquidity and low risk profile with the greatest emphasis on retail customers,
so we have both the ability and willingness to partner with new, good
customers," says Janus Petersen and continues: "Revenue from our insurance business has increased significantly. It stipulates
the importance of the increased focus on this front during recent years. It is
important for our competitiveness, that we can supply our customers with a full
range of financial services," says Janus Petersen. 

Impairments on the loan portfolio were DKK 30 million in the first half of the
year and are henceforth expected to return to a normal level. 

The Bank's costs in the first six months also include payments to the
Collective Depositary Fund of DKK 17 million. 

High solidity and good liquidity

BankNordik's solvency was above 20% at the turn of half-year. The acquisition
of large parts of Amagerbanken reduced the high solvency but following an
increase in the capital base of DKK 600 million in connection with the
acquisition the solvency is approximately 14.5%. This is significantly higher
than the individual solvency requirement of 8.8%. BankNordiks policy remains to
keep a high solvency - significantly exceeding the set requirement. 

The bank´s total deposits are DKK 1.3 billion higher than the loans and
advances which gives the bank a good liquidity. 

Expectations of growth

“We are in the middle of the important integration process with new business
opportunities and focus on control of the resources. But these are positive and
forward looking tasks and challenges and our employees provide a great effort,”
says Janus Petersen. 

The Bank's management is maintaining its previous expectations for 2011 as a
whole of a profit before tax and value adjustments of DKK 100-140 million in
relation to the previous activities. The integration of Amagerbanken is
expected to influence the accounts negatively with around DKK 30 million so
that the overall result is expected to be in the range of DKK 70-110 million. 

From 2012, the increased activities in Denmark are expected to contribute
significantly to the Bank's performance. 

BankNordik was founded over 100 years ago in the Faroe Islands. The Group has
banking activities in Denmark and Greenland and the Faroe Islands and insurance
activities on the Faroe Islands and Iceland. The Bank has a balance of DKK 20
billion and 630 employees. The Bank is subject to the Danish Financial Services
Authority and participating in the Danish deposit guarantee fund. BankNordik is
listed on NASDAQ OMX Copenhagen. 

BankNordik Group

Key figures



Million DKK                                             H1 2011  H1 2010    2010
--------------------------------------------------------------------------------
Interest and fee income and income from insurance           315      308     644
 activities, net                                                                
Staff cost and administrative expenses                      209      195     408
Impairment charges on loans                                  30       35     167
Profit before value adjustments, special items and tax       49       51      16
Profit before tax                                            27      458     416
Total assets                                             13,299   14,984  14,259
Loans and advances                                        8,446    8,793   8,675
Deposits and other debts                                  8,741    8,713   8,790
Due to credit institutions and central banks                146      624     245
Total shareholders' equity                                2,016    2,049   2,003
Solvency ratio                                            20.3%    17.7%   17.0%
Excess cover relative to statutory liquidity               211%     288%    293%
 requirements, %                                                                
--------------------------------------------------------------------------------



Further information may be found in the half- year report.




         Additional information:
         Janus Petersen, CEO, phone +298 330 340
         Árni Ellefsen, CFO, phone +298 330 348
         Investor Relations: ir@banknordik.fo
         A web cast from the CEO is available on the BankNordik website
www.banknordik.fo.

Attachments:

H1 2011 Interim Report.pdf

BankNordik H1 2011 - ENG - FINAL..pdf