BankNordik P/F - Fyrirtækjafréttir

BankNordik achieved an interim result of DKK 71m

Earnings are improving, the integration of Amagerbanken is progressing as
planned, and a high solvency ratio is maintained. 

The Board of Directors of BankNordik has approved the enclosed financial
statements for the third quarter of 2011. It shows a profit for the first three
quarters of DKK 71m before value adjustments and tax compared to a loss of DKK
40m (excluding the divestment of Bakkafrost) for the same period last year.
Before one-off expenses in connection with the integration of Amagerbanken of
DKK 35m the result was DKK 106m. 

The improvement in the third quarter is primarily due to the expansion of the
Danish banking activities through the addition of the healthy parts of
Amagerbanken. In addition, an improved interest margin and a reduction of the
external financing contributed to the performance. 



Earnings are improving - including in Denmark

During 2011, the core earnings have increased from DKK 28m in the first quarter
to DKK 62m in the third quarter, including impairment charges. 

With the acquisition of the healthy parts of Amagerbanken in July this year the
Bank increased its activities in Denmark significantly. This has caused an
improvement of DKK 22m of the result from the banking operations in Denmark in
the third quarter compared to the previous quarter, when excluding one-off
items related to the integration of Amagerbanken. 

Additionally, the acquisition of Amagerbanken has contributed positively to
BankNordik's deposit surplus, just as the acquisition provided access to a wide
range of new customers, offering a basis for an increased business volume. "We are pleased with the result and with the fact that the increased activities
in Denmark influenced the accounts positively. This is achieved despite the
generally lower economic activity and the costs for the integration of
Amagerbanken," says Janus Petersen, CEO of BankNordik, a well capitalised
Nordic bank. 

The acquisition of Amagerbanken has increased BankNordik's deposit surplus,
which stood at DKK 2 billion at the turn of the quarter. It gives the bank a
favourable cash position in credit markets characterized by uncertainty and
turbulence. It has also facilitated a premature DKK 500m reduction of the
bank's funding. 

BankNordik's solvency ratio was calculated at 15% and the solvency requirement
at 9.0% at the end of the third quarter of 2011. The Bank's policy is to
maintain a high solvency - significantly exceeding the requirement. 



The integration of Amagerbanken is on schedule

Since the takeover of the healthy parts of Amagerbanken from 1 July 2011
BankNordik has merged some of the branches to larger and more profitable units
and streamlined the organization in Denmark. As part of the ongoing integration
the name of the branches will change to BankNordik later in November in order
for the Bank to appear as one integrated bank. "The name change will give us better opportunities to position BankNordik on
the Danish market as a strong nationwide local bank with a solid financial
foundation and close relationships with the customers," says Janus Petersen. 

BankNordik's acquisition of the healthy parts of Amagerbanken in the early
summer was part of the bank's strategy of controlled growth and strong local
presence in the market. It has guided BankNordik's significant development
during recent years. The strategy is based on a close relationship with
customers, tight credit control and focus on profitability in all activities. 



Expects continued growth

BankNordik's management maintains its previously announced expectations for
2011, i.e. a profit of DKK 50m-80m after one-off costs of DKK 95m in connection
with the acquisition and integration of Amagerbanken, and before tax, value
adjustments and any additional sector costs for the remaining part of the year. 

Going forward, the increased activities in Denmark are expected to contribute
significantly to the Bank's results. The consolidation of the bank's Danish
operations on a common IT platform is scheduled for early 2012. Thus, the full
advantage of the synergies can be achieved in the second half of the year, and
the full-year impact will occur in 2013. One-time expenses in connection with
the integration of Amagerbanken are expected to amount to DKK 30m-50m in 2012. 



Additional information

Janus Petersen, CEO, phone +298 230 340

John Rajani, Deputy CEO, phone +298 230 352

Árni Ellefsen, CFO, phone +298 230 348

Investor Relations: ir@banknordik.fo



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 19
billion and 630 employees. The Bank is subject to the Danish Financial Services
Authority and is participating in the Danish deposit guarantee fund. BankNordik
is listed on NASDAQ OMX Copenhagen. 



BankNordik-Group

Key figures

Million DKK                                         Q1-3 2011  Q1-3 2010    2010
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Net income                                                543        479     644
Staff and administrative expenses                         393        297     408
Impairment charges on loans                                58        191     208
Profit before value adjustments, and tax                   71       -40*      16
Total assets                                           18,908     15,717  14,259
Loans and advances                                     11,949      8,549   8,675
Deposits and other debts                               13,955      9,254   8,844
Due to credit institutions and central banks              884      3,487   2,445
Total shareholders' equity                              2,037      1,979   2,043
Solvency ratio                                          15.0%      17.1%   17.0%
Excess cover relative to statutory liquidity             149%       338%    293%
 requirements                                                                   
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*Excluding the divestment of Bakkafrost.

Further information may be found in the Interim Report.

Attachments:

Interim Report Q3 2011.pdf