Danske Bank posts £35m pre-tax profit for start of 2016

Results reflect a huge rise in mortgages and increased lending to business
Results reflect a huge rise in mortgages and increased lending to business

Danske Bank has revealed pre-tax profits of £35 million for the first three months of 2016 as the bank reported improved revenues, cost savings and the ‘return’ of funds set aside for bad debt.

The figures mark an 11% jump over the £31.4m for the same period in 2015, as the bank’s total quarterly income rose 5% year-on-year from £53.8m to £56.3m.

Inside that amount is the sum of £8.6m in impairment charges or money set aside to cover bad debt which is not required and can be returned as a ‘write back’.

In revenue terms it said new mortgage approvals rose 170% year-on-year.

New lending to small and medium sized business customers was up by 52% - evidence said Danske Bank UK chief executive Kevin Kingston that many existing customers were “starting to once again invest in growing their businesses”.

“Our underlying financial performance has continued its upward trajectory and we are maintaining a prudent approach to cost management,” he said.

“We started the year with an ambition to significantly grow our presence in the mortgage market, alongside maintaining our market leading position in business banking and among higher net worth customers through our Private Banking and Wealth units,” he added.

“On the corporate banking side, we have seen continued movement in the wider property sector, and deals we have helped to fund in Quarter One have included the sale of Bloomfield shopping centre in Bangor and the planned build of several hundred houses by Lagan Homes (NI) Ltd.

“As consumer and business confidence continues to improve we expect demand for finance to increase further. We look forward to continuing to support customers and the wider economy in the year ahead.

“As well as attracting new customers, it has been particularly pleasing to see many existing customers starting to once again invest in growing their businesses,” he said.