BankNordik P/F - Company Announcement

BankNordik redeems hybrid core capital

In accordance with its capital plan BankNordik redeems the outstanding amount
of DKK 63m in hybrid core capital from the Danish State. 

In accordance with the requirements in the loan agreement dated 21 September
2009 between the Danish State and BankNordik the Bank today has decided to
redeem the outstanding amount of hybrid core capital of DKK 63.138.150 at par.
The issued loan amounting to DKK 204 mill in September 2009 carried an interest
of 10.295 % pro anno. In August and September 2013 the Bank redeemed hybrid
core capital amounting to DKK 141 mill. 

Optimization of the capital structure is one of the Bank's core strategic focus
areas. The Bank therefore continuously monitors the capital structure and the
options in the capital markets given the current and future solvency
requirements. In accordance with its capital plan the Bank now chooses to
redeem the outstanding hybrid core capital amounting to DKK 63 mill, financed
by the Banks profit. Given the development of the business activities in the
last couple of years the Bank has chosen to redeem subordinated debt for a
total amount of DKK 354 mill including this latest redemption. 

The redeeming will be carried out with transaction date on May 8th 2014 and
disposition date on May 9th 2014. The redeeming will be done with a view to
annulment of the corresponding notes. 

At year-end 2013 the Bank had a solvency ratio of 14.7% compared with a
solvency requirement of 8.9%. After redeeming the outstanding amount of hybrid
core capital from the Danish State the solvency ratio drops to 14.2% excluding
the net result in Q1 2014. The solvency ratio is expected to increase in the
period from 2014-19 fuelled by the Bank's profits. 

In accordance with the regulation the Danish FSA has to give its acceptance
prior to redemption of hybrid core capital. The Danish FSA has approved the
decision to redeem the outstanding amount on the background of information from
the Bank on the solvency and that the Bank expects to meet the sharper future
capital requirements in CRD IV and CRR respectively, as well as the expected
SIFI extra requirement, which are expected to be implemented in the period
until 2019. 

Further information:

Janus Petersen, CEO, tlf. (+298) 330 340

Árni Ellefsen, CFO, tlf. (+298) 330 348

Johnny í Grótinum, Investor Relations, tlf. (+298) 230 380, ir@banknordik.fo