Northern Ireland’s biggest bank makes pre-tax profit of £186million

Danske Bank’s business saw its profit before tax from £103.3million last year to £186million - more than three times the figure from 2021.

The full year results for the lender showed revenues rose 22.4% to £332.3m in 2023, in a year where the Bank of England raised interest rates from 3.5% to 5.25%.

Danske Bank also revealed that lending increased by 6% year on year to £6.06 billion, with deposits rising by just 1% to £10.7bn.

The Bank, which marks 200 years of business in 2024, also generated an extra £13.1m in loan impairments, which it said reflected the strength of its loan portfolio.

Costs also increased last year by 7.5% to £159.4m, which Danske put down to inflationary pressures and continued investment .

Vicky Davies, CEO of Danske Bank UK, explained: “I am pleased to announce a strong set of financial results for 2023, with a profit before tax of £186 million.

“A strong financial performance means we are well positioned to continue to support customers, alongside being able to invest in new products and services that improve customer experience.

“In response to inflationary pressures, the Bank of England raised interest rates throughout 2023, from 3.5% at the start of the year, to 5.25% at year-end.

“Despite the ever-changing interest rate environment, we provided over £550million of mortgage lending approvals in 2023 in Northern Ireland - helping thousands of customers realise their home owning ambitions.

“Transaction levels in the mortgage market were slow in quarter one but remained at healthy levels across the rest of the year, with new mortgage lending approvals in the second half of the year 25% higher than in the first half.

“While in 2022 only 27% of our local mortgage customers opted for a two-year fixed mortgage product, in 2023 this rose to 47%, which we believe was an indication that more customers were anticipating rates may come down.

“Currently around 80% of all our mortgage customers hold fixed rate mortgage products, with many having not been immediately impacted by rising central bank rates in 2023. For customers looking ahead to the end of their fixed deals we will contact them throughout the final six months to help ensure they are considering their options.

“We also supported the local business community with over £575 million in business lending approvals. Lending approvals for small businesses were up 23% year-on-year, and sustainable finance lending in Corporate and Business Banking was a notable growth area, with lending approvals up 46% year-on-year.

“At Danske Bank we are very aware that many customers continue to face cost of living challenges. We are staying close to our customers, providing support for those who need it, whilst continuing to help businesses pursue growth opportunities and people buy or move home.

“We have over 500 colleagues across our local branches, mortgages teams and contact centres dedicated to looking after the needs of our personal customers. In Corporate and Business Banking, we have a team of around 80 skilled and experienced relationship managers, by far the largest of any local bank.

“In 2023 we proactively outreached to over 45,000 customers offering guidance and support directly relating to their financial circumstances. Arrears levels across both our personal and business customer base remain very low.

“We are also very proud that in 2023 many colleagues across the bank volunteered to deliver our Money Smart financial education programme in schools, helping improve the knowledge of around 7,000 young people throughout Northern Ireland.

“We remain conscious of our important role in financing the transition to a more sustainable future and it will be through supporting the sustainability approach of our customers that we will make the greatest impact. In 2023 we approved £380 million in sustainable finance lending to businesses and personal customers across the UK, and it was also a year when we received the Northern Ireland ‘climate action’ award presented by Business in the Community.

“We have also seen increased demand from local business customers who want to take part in a Climate Action programme that we co-developed with Business in the Community. Part- funded by Danske Bank, we expect over 215 of our business customers to have completed it by the end of 2024.

“This year we are marking 200 years as a leading local bank. It’s been 200 years of supporting businesses, communities and people. We look forward to our third century in business with renewed optimism and a continued determination to support our customers, wider society and the economy.”