Satisfactory core earnings
The Sydbank Group recorded a pre-tax profit of DKK 960m for the first nine
months of 2008 against DKK 1,871m in Q1-Q3 2007. The result equals a return of
18% p.a. on average shareholders' equity (Tier 1).
Core earnings before impairment represent DKK 1,227m against DKK 1,357m for the
first nine months of 2007. The decline is caused by a reduction in trading
income and a rise in costs.
In Q1-Q3 2008 the Sydbank Group recorded impairment charges for loans and
advances of DKK 85m; in the same period in 2007 DKK 608m was recognised as
income.
Investment portfolio earnings represent a loss of DKK 362m and non-recurring
items of DKK 180m were recognised as net income.
Post-tax profit represents DKK 744m, equal to a return of 14% p.a. on average
shareholders' equity (Tier 1). Earnings per share for the period decreased from
DKK 21.1 to DKK 11.7.
As of 1 February 2008 bankTrelleborg was acquired by and merged with Sydbank,
which has favourably affected the Sydbank Group's loans and advances, deposits
and profit etc in Q1-Q3 2008.
Given the financial crisis and the macroeconomic slowdown, performance as well
as business developments are considered satisfactory.
Sydbank is a member of the Danish Contingency Committee and therefore covered
by the government guarantee scheme which has been set up. Sydbank is of the
opinion that the government guarantee scheme will restore a functioning money
market as well as revive international confidence in Danish banks.
The realised decline in trading income is larger than originally announced.
Consequently and due to the Bank's expenses this year for the government
guarantee scheme estimated at around DKK 70-80m, the Group projects core
earnings before impairment for the year in the lower end of DKK 1.6-1.9bn as
previously announced.
Moreover due to the non-functioning mortgage credit market the Bank's
investment portfolio earnings have deteriorated further by an unrealised
capital loss of around DKK 225m since end-September 2008.
Group Executive Management
As of 1 November 2008 Sydbank's Group Executive Management will include the
Bank's former head of Asset Management, Allan Nørholm.
Allan Nørholm, 43 and MSc (Economics), has worked at Sydbank since 1989,
including the past six years in charge of the Bank's asset management
activities.
Allan Nørholm's responsibilities in the Group Executive Management will
comprise Sydbank Markets, Asset Management and Operations.
As of 1 November 2008 Sydbank's Group Executive Management consists of Carsten
Andersen, Group Chief Executive; Karen Frøsig, Deputy Group Chief Executive;
Preben L. Hansen, Deputy Group Chief Executive and Allan Nørholm, Deputy Group
Chief Executive.
Yours faithfully
Kresten Philipsen Carsten Andersen
Chairman of Group Chief Executive
the Board of Directors
Enquiries concerning this Announcement to
Carsten Andersen, Group Chief Executive, tel +45 74 36 20 00
