2012-05-15 07:38:01 CEST

2012-05-15 07:39:01 CEST


REGULATED INFORMATION

BankNordik P/F - Financial Statement Release

Interim Q1-2012 Report 


Good Q1 performance for BankNordik as expected

Improved income and slightly lower costs doubled operating profit, compared to
previous quarter, to DKK 70m before impairment charges and non-recurring costs. 

BankNordik maintains positive guidance for 2012 overall.

BankNordik generated net operating income of DKK 223m in Q1 2012, up from DKK
192m in the previous quarter, which was affected by powerful windstorms in the
Faroes in November and December. 

As planned, costs were reduced slightly, ending at DKK 153m relative to DKK
157m in the preceding quarter. 

Operating profit before impairment charges doubled to DKK 70m in Q1 2012 from
DKK 35m in Q4 2011 (adjusted for non-recurring items). 

Net loan impairment charges amounted to DKK 22m, a substantial improvement from
Q4 2011 and in line with expectations. This brought the operating profit to DKK
48m before non-recurring items, compared to a DKK 2m loss in the preceding
quarter. 

“We are very pleased to report improvements in both income and profit,
especially given the current economic environment as well as the extensive
in-house integration of the activities acquired from Amagerbanken. That bodes
well for 2012 and especially onwards,” says BankNordik CEO Janus Petersen. 

The Q1 financial statements carried non-recurring costs for integration and
restructuring of DKK 48m. 

Backed by equity of DKK 2.0bn and subordinated debt of DKK 0.8bn, BankNordic
had a solvency ratio of 14.9% at 31 March 2012, as compared with the solvency
requirement of 9.2%. BankNordik's policy is to retain a high solvency ratio at
significantly above the required level. The same applies to the liquidity
coverage, which was more than twice the required level. 

Consolidation after strong growth

BankNordik acquired considerable operations from Sparbank in 2010 as well as
the healthy parts of Amagerbanken in 2011. This meant that in terms of
deposits, the Bank's operations more than doubled in the two years. 

The last major steps to consolidate the IT systems were taken in February and
March after a period of thorough planning in the preceding months. The
preparations and conversion have strained the organisation, but the changes are
of strategic importance in respect of the continual development of customer
service and the ongoing efforts to enhance efficiency. Both are important
objectives for BankNordik. In addition, branches in Denmark and in Greenland
were merged, while also reducing the headcount. 

“We've invested a lot of effort in getting things in order. In particular, it
was very important to us that our customers felt the effect as little as
possible,” says Janus Petersen, CEO of BankNordik. 

“Looking ahead, these big and very important steps have enabled us to offer
better customer service and to continue the Bank's healthy development based on
our strategy of proximity to our customers, tight risk management and
profitability in all operations”, says Janus Petersen. 

Forecasting an improved performance

BankNordik continues to expect a profit of DKK 100-170m in 2012 before sector
costs and adjustments (2011: DKK 50m). 

“Our biggest assignment this year will be to streamline activities, so we can
lift our efficiency. At the same time, we must maintain the close contact to
our customers that we're known for, and we must grow our business from the new,
broader platform we've built over the past couple of years,” said Janus
Petersen. 

BankNordik's consolidated financial highlights





DKKm                                  Q1      Q2      Q3      Q4      Q1    2011
                                      11      11      11      11    2012        
--------------------------------------------------------------------------------
Operating income*                    157     173     232     192     223     735
Profit before impairment              54      66      80      35      70     235
 charges*                                                                       
Impairment charges                   -24      -8     -17     -37     -22     101
Operating profit*                     31      58      63      -2      48     134
Non-recurring items                  -20     -35     -33     -31     -37    -103
Profit before tax                     10      23      30     -33      11      31
Deposits, etc.                     8,943   8,740  13,955  13,032  13,088  13,032
Loans and advances, etc.           8,376   8,446  11,949  11,769  11,376  11,769
Deposit surplus                      567     294   2,006   1,263   1,712   1,263
Total assets                      13,502  13,289  18,902  17,096  17,897  17,086
Equity                             1,977   1,993   2,017   1,958   1,963   1,958
Solvency ratio                     17.1%   20.3%   15.0%   15.6%   14.9%   15.6%
Excess cover relative to            163%    111%    149%    115%    169%    115%
 statutory liquidity                                                            
 requirements                                                                   
--------------------------------------------------------------------------------

* Adjusted for non-recurring items

Further details are available in the Q1 interim report.

Conference call and webcast today at 11.00 AM (CET)

BankNordik will review the financial results today at 11.00 (CET) at its
customary conference call for analysts and investors. The conference call will
be webcast on BankNordik's website, www.banknordik.fo. 

The dial-in number for the conference call is (+45) 32 71 47 67.  Participants
are kindly asked to call in a few minutes before the conference begins. 

For further information, please contact:

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

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

Chief Investor Relations Officer



BankNordik was founded more than 100 years ago in the Faroe Islands. The Group
has banking activities in Denmark, Greenland and the Faroe Islands and
insurance activities in the Faroe Islands and Iceland. The Group has 180,000
customers, total assets of DKK 18bn and 580 employees. The Bank is subject to
the supervision of the Danish Financial Supervisory Authority and is listed on
NASDAQ OMX.