Danske Bank A/S Q3 2024 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Gulnara Saitkulova - Morgan Stanley - Analyst : This is Gulnara from Morgan Stanley. My first question is on capital. So you had a very solid print this quarter. Can you remind us what are the priorities when it comes to the excess capital? And what is your thinking when deciding between the buybacks, ordinary and special dividends and M&A, given the consolidation that we saw in the region with the DB acquisition of (inaudible)? And where -- and in which business areas now do you have the most appetite for organic and inorganic growth for potentially for further bolt-on acquisitions? And another question on the buyback, maybe calibrate how should we think about the pace and the size of the buybacks going forward?

Question: Sofie Peterzens - JPMorgan - Analyst : You flagged that there is a partnership payment fee in the fee line. Could you just disclose how much that partnership payment was also related to fees, how we should think about the new ruling on credit, what benefit that could potentially have for Danske Bank? And then my second question would be on the net interest income. I understand that -- or what you said is that 2025 net interest income is still uncertain. But could you kind of talk about the moving parts when you think about net interesting covering '25 and '26? Some of your Nordic peers have said that there are some signing issues when it comes to net interest income. Is that something we should expect for Danske Bank as well? And also, related to that, if you could just give details what the average yield on your hedge is and that if it is still DKK150 billion?

Question: Namita Samtani - Barclays - Analyst : I had questions on Danica pension. So I read in the report that you've developed a new commercial strategy, and it's going to replace the current strategy. I just wondered why you're changing the strategy. And secondly, I read an article -- that Danica has given an DKK800 million loan to [Northvolt]. I just wondered if the group is adequately provisioned on this loan given Northvolt looks like it's a bit of trouble?

Question: Johannes Thormann - HSBC - Analyst : Two questions from my side. First of all, regarding the risk cost. We'll be constantly now see for, I don't know, 10 quarters an either small releases or a very small charges. What needs to happen to get back to the 8 bps of risk costs? How much changes do you have to see in your portfolio quality or asset quality? And then do we really need to see one big guy falling off the cliff? Or just help me to understand forward-looking outlook. And the second thing is on your fee income. I understand that the Capital Markets business is probably -- and even investment is a bit volatile. But money transfers has been very volatile this year. So can you elaborate more what's driving this volatility?

Question: Patrick Nelson - Goldman Sachs - Analyst : I just had one question on your revenue trajectory outlook that you outlined with your Investor Day. And I remember you also outlining your interest rate assumptions there and the rates sort of past has moved a lot during this year. So I was just wondering, is there anything in that, that has affected your sort of long-term total income outlook? Or would you say that rate assumptions from your Investor Day was conservative enough so that everything that you said there still stands?

Question: Jan Erik Gjerland - ABG Sundal Collier - Analyst : Jan Gjerland from ABG in Oslo. I just wanted to continue on the lending part you mentioned here and ask the first question on the lending growth outlook, both in Denmark for your SMEs, LSC as well as mortgage risk. And also some sheds some light into your ambitions in the Nordic countries when it comes to the lending growth outlook for this -- for the remaining of the year and into 2025. As it looks like, as you said, it's turning a little bit positively on the lower rate expectations. So could you shed some light into your -- how you're working these days and how this is coming through on your trajectory? That would be very helpful. And secondly, also on the NII, the bridge on the second to the third quarter, where you have a treasury gain of DKK179 million. Is all of that the hedge? Or it's just part of that the hedge?

Question: Shrey Srivastava - Citi - Analyst : I want to focus on the OpEx line, where obviously, you beat today. How do you see the phasing of the reduction in financial crime and remediation costs in 2025 and 2026, respectively? Is it that we're going to see a notable step up post your probation period ending? Or do you see this going down fairly [nearly] throughout the two years?

Question: Shrey Srivastava - Citi - Analyst : Cool. And just one additional one for me. How do you see the progress of your transformational strategic initiatives in Personal Customers, Sweden? Obviously, there's been relatively flattish relevance there, but that's been the case for the industry to an extent. So I'm just interested in how you see progress towards your strategic objectives and what we can look forward to in the future? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 31, 2024 / 7:30AM, DANSKE.CO - Q3 2024 Danske Bank A/S Earnings Call

Question: Martin Ekstedt - Handelsbanken Capital Markets - Analyst : I just wanted to follow up on an earlier question on capital repatriation. So at Q2, you mentioned a dividend potential from 2023 to '26 of above DKK50 billion. I just wanted to check if that still stands -- confirmed that this includes buybacks -- and that this statement also took high for the probation period stretching to the end of 2025 that you mentioned before? Also, does this [rate hikes] for any inorganic growth that you also mentioned before?