This document is an unofficial translation of the Danish original. In the event
of any inconsistencies, the Danish version shall apply.
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| 13 August 2008 |
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| OMX Nordic Stock Exchange Copenhagen | |
| Nikolaj Plads 6 | |
| 1067 Copenhagen K | |
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Stock exchange announcement no 12/2008
Lokalbanken i Nordsjælland's interim report for H1 2008
The Supervisory Board of Lokalbanken has today approved the Bank's interim
report for H1 2008.
Pre-tax profit of DKK 41m
7% growth in net interest income
Expected pre-tax profit for the year of DKK 70-90m.
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| Key figures | H1 | H1 | FY | H1 | H1 | H1 |
| (DKK'm) | 2008 | 2007 | 2007 | 2006 | 2005 | 2004 |
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| Net interest and | 141.1 | 141.3 | 287.2 | 126.6 | 118.1 | 102.0 |
| fee income | | | | | | |
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| Translation/mark | 19.8 | 5.7 | -4.5 | 3.6 | 12.6 | 7.0 |
| et value | | | | | | |
| adjustments | | | | | | |
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| Staff costs and | 100.4 | 96.6 | 196.9 | 85.0 | 75.5 | 69.6 |
| administrative | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| Impairment | 18.1 | -12.6 | 3.1 | 2.0 | 4.7 | 10.3 |
| losses on loans, | | | | | | |
| advances and | | | | | | |
| receivables, etc | | | | | | |
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| Profit/loss from | -0.1 | 0.0 | 0.1 | 0.0 | 0.1 | 0.7 |
| investments in | | | | | | |
| associates and | | | | | | |
| group | | | | | | |
| enterprises | | | | | | |
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| Profit for the | 30.8 | 45.8 | 63.2 | 30.0 | 30.5 | 18.6 |
| period | | | | | | |
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| Loans and | 4,046 | 3,247 | 3,928 | 2,817 | 1,962 | 1,620 |
| advances | | | | | | |
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| Deposits | 3,474 | 3,587 | 3,415 | 3,040 | 2,691 | 2,149 |
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| Equity | 693 | 684 | 678 | 578 | 512 | 440 |
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| Total assets | 5,888 | 5,231 | 5,760 | 4,305 | 3,722 | 3,049 |
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| Guarantees, etc | 1,541 | 3,055 | 1,886 | 3,051 | 2,537 | 1,882 |
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The rules governing the preparation of financial statements were materially
changed in 2005. The financial highlights for 2004 to 2008 have been prepared in
accordance with the changed rules. Comparative figures for 2004 for financial
assets and liabilities have not been restated.
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| Ratios | H1 | H1 | FY | H1 | H1 | H1 |
| | 200 | 2007 | 2007 | 2006 | 2005 | 2004 |
| | 8 | | | | | |
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| Capital adequacy | | | | | | |
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| Capital adequacy | 13. | 14.2 | 12.8 | 11.9 | 14.2 | 14.4 |
| ratio in % | 7 | | | | | |
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| Core capital ratio in | 11. | 12.3 | 11.0 | 12.5 | 14.6 | 15.0 |
| % | 7 | | | | | |
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| Earnings | | | | | | |
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| Return on equity | 6.0 | 9.2 | 12.3 | 7.2 | 8.6 | 6.4 |
| before tax for the | | | | | | |
| period in % | | | | | | |
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| Return on equity | 4.5 | 6.9 | 9.5 | 5.3 | 6.1 | 4.3 |
| after tax for the | | | | | | |
| period in % | | | | | | |
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| Operating income over | 1.3 | 1.69 | 1.40 | 1.45 | 1.49 | 1.33 |
| operating expenses in | 4 | | | | | |
| DKK | | | | | | |
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| Market risks | | | | | | |
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| Interest rate risk in | 0.6 | 2.0 | 1.1 | 1.1 | 1.1 | 2.4 |
| % | | | | | | |
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| Currency position in | 1.8 | 6.2 | 68.4 | 0.2 | 0.1 | 18.4 |
| % | | | | | | |
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| Currency exposure in | 0.0 | 0.0 | 0.1 | 0.0 | 0.0 | 0.0 |
| % | | | | | | |
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| Credit risks | | | | | | |
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| Loans and advances | 120 | 94.5 | 119.4 | 98.4 | 80.0 | 84.4 |
| relative to deposits | .6 | | | | | |
| in % | | | | | | |
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| Loans and advances | 5.8 | 4.8 | 5.8 | 4.9 | 3.9 | 3.7 |
| relative to equity | | | | | | |
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| Loan growth for the | 3.0 | 6.5 | 28.8 | 18.9 | 10.9 | 6.0 |
| period in % | | | | | | |
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| The sum of large | 91. | 169.2 | 178.5 | 250.2 | 205.2 | 100.0 |
| commitments in % | 0 | | | | | |
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| Impairment ratio for | 0.3 | -0.2 | 0.1 | 0.0 | 0.1 | 0.3 |
| the period in % | | | | | | |
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| Liquidity | | | | | | |
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| Excess liquidity in | 114 | 87.9 | 116.4 | 50.5 | 136.1 | 146.5 |
| relation to statutory | .1 | | | | | |
| requirements of | | | | | | |
| liquidity in % | | | | | | |
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| Shares | | | | | | |
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| Earnings per share | 57. | 84.8 | 123.2 | 55.5 | 56.5 | 37.7 |
| for the period (DKK | 0 | | | | | |
| 100 nominal) | | | | | | |
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| Book value per share | 1,3 | 1,289 | 1,320 | 1,071 | 945 | 814 |
| (DKK 100 nominal) | 60 | | | | | |
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| Dividends per share | - | - | 20 | - | - | - |
| (DKK 100 nominal) | | | | | | |
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| Price/earnings per | 19. | 26.6 | 16.8 | 36.4 | 18.8 | 17.3 |
| share for the period | 3 | | | | | |
| (DKK 100 nominal) | | | | | | |
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| Price (DKK 100 | 0.8 | 1.75 | 1.56 | 1.89 | 1.60 | 1.18 |
| nominal)/book value | 0 | | | | | |
| per share in DKK | | | | | | |
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| Share price, | 1,1 | 2,255 | 2,064 | 2,019 | 1,513 | 960 |
| period-end (DKK 100 | 00 | | | | | |
| nominal) | | | | | | |
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The rules governing the preparation of financial statements were materially
changed in 2005. The financial highlights for 2004-2008 have been prepared in
accordance with the changed rules. However, comparative figures for 2004 have
not been restated for financial assets and liabilities. Capital adequacy ratios
have been complied based on the accounting policies applicable for the relevant
year. The denomination of the Bank's shares was in 2005 changed from DKK 100
nominal to DKK 20 nominal.
Management's review for H1 2008
Development in activities and finances
Core business
The Bank's core business for H1 2008 has developed as expected, attaining a
level as for the same period last year. The expectations provided for in the
budget have been fulfilled because increasing interest income was able to
compensate for the cyclical decline in fee income from activities in the housing
and securities areas.
Expenses are up by 1.7% on H1 2007, which is better than expected.
The Bank's
portfolio of own securities resulted in a capital loss of DKK 11.5m for H1
against an estimated gain of DKK 6m.
Due to developments on the securities markets, the Bank has decided to generally
adjust its pre-tax earnings expectations for the year downwards by DKK 20m to
DKK 70-90m.
Net interest and fee income
Net interest and fee income of DKK 141.1m for H1 2008 is in line with that for
H1 2007. Net interest income went up by 6.7% to DKK 104.1m, which is a result of
the increasing interest rate level on total loans and advances which also made
it possible for the Bank to continue to adjust to the increased competition on
deposits.
Net fee income is down by 14.7% to DKK 36.4m. Less activity in the housing
market and a general trend of falling prices and turbulence in the financial
markets have caused the Bank's income from refinancing and house deals as well
as brokerage fees from securities trading to be lower than predicted at the
beginning of the year.
The Bank believes that the total net interest and fee income for the rest of
2008 will not be subjected to material changes compared to the present
situation. Consequently, the net interest and fee income expectations already
provided for in the budget are maintained, however, subject to some uncertainty
that is contingent on the current cyclical turn.
Translation/market value adjustments
The Bank has in H1 2008 generated positive translation/market value adjustments
of DKK 19.8m, which is inclusive of a capital gain of DKK 30m relating to the
subsequent adjustment from the sale of Totalkredit to Nykredit - see stock
exchange announcement no 5/2008 - "Totalkredit/Nykredit offers Lokalbanken i
Nordsjælland a/s a modified cooperation agreement". During the period, the
Bank's own portfolio generated a capital loss of DKK 11.5m, resulting primarily
from the turbulence on the financial markets that has affected the first half of
2008. However, the Bank has in the same period taken DKK 1.5m to income from
currency trading.
The Bank aims to have limited risk on its portfolio of shares and bonds, for
which reason it therefore reduced its own portfolio significantly early in the
year, which has minimised the Bank's risk of sustaining further capital losses.
At the beginning of the year, a positive market value adjustment of DKK 6m was
provided for in the budget. For all of 2008, the Bank's own portfolio is
expected to realise a capital loss at the present level of DKK 12-13m even if a
certain volatility in the market should continue. This results in a downward
adjustment of expected translation/market value adjustments by approx DKK 20m.
Impairment losses on loans, advances and receivables, etc
The Bank's impairment losses for H1 2008 amount to DKK 18.1m against an income
of DKK 12.6m for the same period last year. The level of impairment losses is as
expected according to the Bank's originally published budget for the financial
year 2008. Declining market trends and turbulence in the real estate market have
resulted in increased risk in specific commercial banking segments, and a
similar trend is expected to arise with certain groups of retail banking
customers. So, developments will also in the second half of the year result in
impairment losses, but these losses are not estimated to higher than originally
expected and have therefore already been included in the Bank's budget.
The Bank is involved in a small number of real estate projects and financing of
sites, primarily in North Zealand. In Q2 2008, the Bank took over a project with
36 completed owner-occupied flats in the Greater Copenhagen area. The necessary
write-downs for impairment of this account have been made in the Bank's annual
report for 2007, and the Bank is no longer involved in any real estate projects
in Greater Copenhagen.
Expenses
Compared to H1 2007, a 1.7% increase in expenses was less than expected, and the
reason is that the rise in payroll costs and administrative expenses is below
budget, and less money has been spent on property, plant and equipment than was
anticipated.
Liquidity
Lokalbanken's excess liquidity at 30 June 2008 is 114.1%, which is considerably
more than the minimum excess of 50% which the Bank wants to maintain.
The composition of this liquidity implies that the Bank is not heavily dependent
on the day-to-day money market.
None of the existing funding facilities used with other credit institutions
mature in 2008, for which refunding will not be necessary in this financial
year.
Capital adequacy
The capital adequacy ratio is 13.7% and thus represents a comfortable gap to the
ratio of 12.5% which is the Bank's political objective.
So the Bank still has a satisfactory excess in relation to the capital adequacy
ratio.
Events after 30 June 2008
No events or unusual circumstances have occurred after 30 June 2008 which
materially affect the Bank's financial position.
Accounting policies
The interim report has been presented in accordance with the Danish Financial
Business Act, including the Danish Financial Supervisory Authority's Executive
Order on Financial Reports for Credit Institutions and Investment Companies, etc
as well as additional Danish disclosure requirements for interim reports for
listed financial companies.
The accounting policies are consistent with those applied in the annual report
for 2007.
Statement by Management on the annual report
The Supervisory and Executive Boards have today presented the interim report of
Lokalbanken i Nordsjælland a/s for the period 1 January to 30 June 2008.
The interim report has been presented in accordance with the Danish Financial
Business Act and the Danish Financial Supervisory Authority's Executive Order on
Financial Reports for Credit Institutions and Investment Companies etc. Further,
the interim report has been prepared in accordance with additional Danish
disclosure requirements for listed financial companies.
We consider the accounting policies appropriate for the interim report to
provide a true and fair view of Lokalbanken's assets, equity and liabilities,
financial position and the results.
The interim report has not been audited or reviewed.
Yours sincerely
Lokalbanken i Nordsjælland a/s
Erik Uttenthal Bruno Riis-Nielsen
Chairman CEO
Appendices: Income statement
Balance sheet
Statement of changes in equity
Notes
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| Income statement | | H1 | | H1 | | FY |
| (DKK'000) | | 2008 | | 2007 | | 2007 |
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| Not | | | | | | | |
| e | | | | | | | |
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| 1 | Interest income | | 177,46 | | 142,72 | | 305,434 |
| | | | 2 | | 5 | | |
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| 2 | Interest expenses | | 73,341 | | 45,175 | | 105,178 |
--------------------------------------------------------------------------------
| | Net interest income | | 104,12 | | 97,550 | | 200,256 |
| | | | 1 | | | | |
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--------------------------------------------------------------------------------
| | Dividends on shares, etc | | 560 | | 1,021 | | 1,242 |
--------------------------------------------------------------------------------
| 3 | Fees and commission | | 41,123 | | 47,849 | | 95,704 |
| | income | | | | | | |
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| | Ceded fees and commission | | 4,682 | | 5,136 | | 10,040 |
| | expenses | | | | | | |
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| | Net interest and fee | | 141,12 | | 141,28 | | 287,162 |
| | income | | 2 | | 4 | | |
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--------------------------------------------------------------------------------
| 4 | Translation/market value | | 19,811 | | 5,697 | | -4,485 |
| | adjustments | | | | | | |
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| | Other operating income | | 1,340 | | 2,801 | | 5,140 |
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| 5 | Staff costs and | | 100,43 | | 96,602 | | 196,942 |
| | administrative expenses | | 4 | | | | |
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| | Depreciation, | | 1,215 | | 3,578 | | 3,654 |
| | amortisation and | | | | | | |
| | impairment losses on | | | | | | |
| | intangible assets and | | | | | | |
| | property, plant and | | | | | | |
| | equipment | | | | | | |
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| | Other operating expenses | | 1,402 | | 1,138 | | 2,510 |
--------------------------------------------------------------------------------
| | Impairment losses on | | 18,118 | | -12,63 | | 3,090 |
| | loans, advances and | | | | 7 | | |
| | receivables, etc | | | | | | |
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| 6 | Profit/loss from | | -67 | | -27 | | 92 |
| | investments in associates | | | | | | |
| | and group enterprises | | | | | | |
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| | Profit before tax | | 41,037 | | 61,074 | | 81,713 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Tax on profit for the | | 10,259 | | 15,269 | | 18,487 |
| | period | | | | | | |
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| | Profit for the period | | 30,778 | | 45,805 | | 63,226 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Balance sheet | | H1 | | H1 | | FY |
| (DKK'000) | | 2008 | | 2007 | | 2007 |
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| Not | ASSETS | | | | | | |
| e | | | | | | | |
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--------------------------------------------------------------------------------
| | Cash and demand deposits | | 490,20 | | 53,757 | | 55,003 |
| | with central banks | | 7 | | | | |
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| | Receivables from credit | | 790,89 | | 1,155,0 | | 1,098,8 |
| | institutions and central | | 0 | | 66 | | 02 |
| | banks | | | | | | |
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| 7 | Loans, advances and other | | 4,046, | | 3,247,2 | | 3,928,3 |
| | receivables at amortised | | 334 | | 24 | | 20 |
| | cost | | | | | | |
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| | Bonds at fair value | | 147,20 | | 435,391 | | 334,078 |
| | | | 1 | | | | |
--------------------------------------------------------------------------------
| | Shares, etc | | 149,31 | | 201,534 | | 182,183 |
| | | | 1 | | | | |
--------------------------------------------------------------------------------
| | Investments in associates | | 2,194 | | 0 | | 0 |
--------------------------------------------------------------------------------
| | Investments in group | | 1,078 | | 619 | | 738 |
| | enterprises | | | | | | |
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| | Investment property | | 93,265 | | 0 | | 0 |
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| | Owner-occupied property, | | 113,62 | | 98,823 | | 105,697 |
| | land and buildings | | 7 | | | | |
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| | Total land and buildings | | 206,89 | | 98,823 | | 105,697 |
| | | | 2 | | | | |
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| | Other property, plant and | | 3,829 | | 3,848 | | 3,726 |
| | equipment | | | | | | |
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| | Current tax assets | | 6,593 | | 0 | | 4,710 |
--------------------------------------------------------------------------------
| | Deferred tax assets | | 15,553 | | 2,500 | | 15,553 |
--------------------------------------------------------------------------------
| | Other assets | | 22,689 | | 26,353 | | 27,117 |
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| | Prepayments | | 5,573 | | 5,507 | | 4,253 |
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| | Total assets | | 5,888, | | 5,230,6 | | 5,760,1 |
| | | | 344 | | 22 | | 80 |
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--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Balance sheet | | H1 | | H1 | | FY |
| (DKK'000) | | 2008 | | 2007 | | 2007 |
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| | EQUITY AND LIABILITIES | | | | | | |
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--------------------------------------------------------------------------------
| | Payables | | | | | | |
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| | Payables to credit | | 1,342, | | 586,688 | | 1,300,9 |
| | institutions and central | | 709 | | | | 90 |
| | banks | | | | | | |
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| | Deposits and other | | 3,474, | | 3,586,9 | | 3,414,5 |
| | payables | | 129 | | 52 | | 12 |
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| | Issued bonds at amortised | | 188,29 | | 188,699 | | 189,034 |
| | cost | | 3 | | | | |
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| | Current tax liabilities | | 0 | | 13,155 | | 0 |
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| | Other liabilities | | 73,954 | | 58,834 | | 61,961 |
--------------------------------------------------------------------------------
| | Deferred income | | 1,211 | | 1,568 | | 912 |
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| | Total payables | | 5,080, | | 4,435,8 | | 4,967,4 |
| | | | 296 | | 96 | | 09 |
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--------------------------------------------------------------------------------
| | Provisions | | | | | | |
--------------------------------------------------------------------------------
| | Provisions for pensions | | 325 | | 275 | | 325 |
| | and similar commitments | | | | | | |
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| 8 | Provisions for losses on | | 14,933 | | 10,927 | | 14,710 |
| | guarantees | | | | | | |
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| | Total provisions | | 15,258 | | 11,202 | | 15,035 |
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--------------------------------------------------------------------------------
| | Subordinate debt | | 100,00 | | 100,000 | | 100,000 |
| | | | 0 | | | | |
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--------------------------------------------------------------------------------
| | Equity | | | | | | |
--------------------------------------------------------------------------------
| | Share capital | | 54,000 | | 54,000 | | 54,000 |
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| | Revaluation reserve | | 12,398 | | 8,662 | | 12,398 |
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| | Statutory reserves | | 151 | | 85 | | 151 |
--------------------------------------------------------------------------------
| | Retained earnings | | 626,24 | | 620,777 | | 600,387 |
| | | | 1 | | | | |
--------------------------------------------------------------------------------
| | Proposed dividends | | 0 | | 0 | | 10,800 |
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--------------------------------------------------------------------------------
| | Total equity | | 692,79 | | 683,524 | | 677,736 |
| | | | 0 | | | | |
--------------------------------------------------------------------------------
| | Total equity and | | 5,888, | | 5,230,6 | | 5,760,1 |
| | liabilities | | 344 | | 22 | | 80 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 9 | Contingent liabilities | | | | | | |
--------------------------------------------------------------------------------
| | Guarantees, etc | | 1,536, | | 3,050,2 | | 1,881,7 |
| | | | 969 | | 39 | | 32 |
--------------------------------------------------------------------------------
| | Other contingent | | 3,966 | | 4,569 | | 4,569 |
| | liabilities | | | | | | |
--------------------------------------------------------------------------------
| | Total contingent | | 1,540, | | 3,054,8 | | 1,886,3 |
| | liabilities | | 935 | | 08 | | 01 |
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Statement of changes in equity
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| All figures in | Share | Revalua | Statuto | Retained | Propose | Total |
| DKK'000 | capital | tion | ry | earnings | d | |
| | | reserve | reserve | | dividen | |
| | | | s | | ds | |
| | | | subsidi | | | |
| | | | aries | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity at 1 | 54,000 | 8,662 | 85 | 572,985 | 10,800 | 646,532 |
| January 2007 | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Dividends paid | | | | | -10,800 | -10,800 |
--------------------------------------------------------------------------------
| Dividends on | | | | 240 | | 240 |
| own shares | | | | | | |
--------------------------------------------------------------------------------
| Acquisition | | | | 1,747 | | 1,747 |
| and sale of | | | | | | |
| own shares, | | | | | | |
| net | | | | | | |
--------------------------------------------------------------------------------
| Profit for the | | | | 45,805 | | 45,805 |
| period | | | | | | |
| transferred to | | | | | | |
| equity | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Equity at 30 | 54,000 | 8,662 | 85 | 620,777 | 0 | 683,524 |
| June 2007 | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Acquisition | | | | -36,121 | | -36,121 |
| and sale of | | | | | | |
| own shares, | | | | | | |
| net | | | | | | |
--------------------------------------------------------------------------------
| Fair value | | 3,736 | | | | 3,736 |
| adjustment of | | | | | | |
| owner-occupied | | | | | | |
| property | | | | | | |
--------------------------------------------------------------------------------
| Profit for the | | | | 6,622 | 10,800 | 17,422 |
| period | | | | | | |
| transferred to | | | | | | |
| equity | | | | | | |
--------------------------------------------------------------------------------
| Share-based | | | | 1,064 | | 1,064 |
| incentive | | | | | | |
| programme | | | | | | |
--------------------------------------------------------------------------------
| Tax on equity | | | | 8,111 | | 8,111 |
| items | | | | | | |
--------------------------------------------------------------------------------
| Subsidiaries | | | 66 | -66 | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity at 31 | 54,000 | 12,398 | 151 | 600,387 | 10,800 | 677,736 |
| December 2007 | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Dividends paid | | | | | -10,800 | -10,800 |
--------------------------------------------------------------------------------
| Dividends on | | | | 537 | | 537 |
| own shares | | | | | | |
--------------------------------------------------------------------------------
| Acquisition | | | | -5,461 | | -5,461 |
| and sale of | | | | | | |
| own shares, | | | | | | |
| net | | | | | | |
--------------------------------------------------------------------------------
| Profit for the | | | | 30,778 | | 30,778 |
| period | | | | | | |
| transferred to | | | | | | |
| equity | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity at 30 | 54,000 | 12,398 | 151 | 626,241 | 0 | 692,790 |
| June 2008 | | | | | | |
--------------------------------------------------------------------------------
The Bank has a portfolio of own shares corresponding to 5.6% of its share
capital that has been deducted from retained earnings in equity.
--------------------------------------------------------------------------------
| Notes | | H1 | | H1 | | FY |
| (DKK'000) | | 2008 | | 2007 | | 2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 1. Interest income | | | | | | |
--------------------------------------------------------------------------------
| | Receivables from credit | | 16,800 | | 15,511 | | 30,427 |
| | institutions and central | | | | | | |
| | banks | | | | | | |
--------------------------------------------------------------------------------
| | Loans, advances and other | | 160,31 | | 123,611 | | 264,981 |
| | receivables | | 3 | | | | |
--------------------------------------------------------------------------------
| | Calculated interest of | | -2,940 | | -2,403 | | -2,356 |
| | impaired value of loans and | | | | | | |
| | advances transferred to | | | | | | |
| | impairment losses | | | | | | |
--------------------------------------------------------------------------------
| | Bonds | | 3,126 | | 5,820 | | 11,892 |
--------------------------------------------------------------------------------
| | Currency, interest-rate, | | 163 | | 116 | | 420 |
| | share, commodity and other | | | | | | |
| | contracts and derivative | | | | | | |
| | financial instruments | | | | | | |
--------------------------------------------------------------------------------
| | Other interest income | | 0 | | 70 | | 70 |
--------------------------------------------------------------------------------
| | Total interest income | | 177,46 | | 142,725 | | 305,434 |
| | | | 2 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | The Bank has no interest | | | | | | |
| | income from sale and | | | | | | |
| | repurchase transactions. | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 2. Interest expenses | | | | | | |
--------------------------------------------------------------------------------
| | Credit institutions and | | 16,936 | | 3,883 | | 15,813 |
| | central banks | | | | | | |
--------------------------------------------------------------------------------
| | Deposits and other payables | | 48,376 | | 34,770 | | 75,287 |
--------------------------------------------------------------------------------
| | Issued bonds | | 4,818 | | 3,928 | | 8,594 |
--------------------------------------------------------------------------------
| | Subordinate debt | | 2,987 | | 2,574 | | 5,464 |
--------------------------------------------------------------------------------
| | Other interest expenses | | 224 | | 20 | | 20 |
--------------------------------------------------------------------------------
| | Total interest expenses | | 73,341 | | 45,175 | | 105,178 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | The Bank has no interest | | | | | | |
| | expenses from sale and | | | | | | |
| | repurchase transactions. | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 3. Fees and commission | | | | | | |
| | income | | | | | | |
--------------------------------------------------------------------------------
| | Securities trading and | | 13,210 | | 18,440 | | 35,910 |
| | custody accounts | | | | | | |
--------------------------------------------------------------------------------
| | Payment services | | 3,759 | | 3,840 | | 7,646 |
--------------------------------------------------------------------------------
| | Loan application fees | | 5,683 | | 6,884 | | 15,860 |
--------------------------------------------------------------------------------
| | Guarantee commission | | 12,138 | | 11,810 | | 23,892 |
--------------------------------------------------------------------------------
| | Other fees and commissions | | 6,333 | | 6,875 | | 12,396 |
--------------------------------------------------------------------------------
| | Total fees and commission | | 41,123 | | 47,849 | | 95,704 |
| | income | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 4. Translation/market value | | | | | | |
| | adjustments | | | | | | |
--------------------------------------------------------------------------------
| | Other loans, advances and | | 26 | | 52 | | 0 |
| | receivables at fair value | | | | | | |
--------------------------------------------------------------------------------
| | Bonds | | -2,875 | | 111 | | -2,896 |
--------------------------------------------------------------------------------
| | Shares, etc | | 21,116 | | 4,582 | | -2,061 |
--------------------------------------------------------------------------------
| | Currencies | | 1,495 | | 826 | | 957 |
--------------------------------------------------------------------------------
| | Currency, interest-rate, | | 49 | | 126 | | -485 |
| | share, commodity and other | | | | | | |
| | contracts as well as | | | | | | |
| | derivative financial | | | | | | |
| | instruments | | | | | | |
--------------------------------------------------------------------------------
| | Total translation/market | | 19,811 | | 5,697 | | -4,485 |
| | value adjustments | | | | | | |
--------------------------------------------------------------------------------
| | Of this, profit from sale | | 29,760 | | 0 | | 0 |
| | of Totalkredit shares | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 5. Staff costs and | | | | | | |
| | administrative expenses | | | | | | |
--------------------------------------------------------------------------------
| | Salaries and remuneration | | | | | | |
| | to the Supervisory and | | | | | | |
| | Executive Boards as well as | | | | | | |
| | the Committee of | | | | | | |
| | Shareholders | | | | | | |
--------------------------------------------------------------------------------
| | Executive Board | | 1,260 | | 1,136 | | 2,253 |
--------------------------------------------------------------------------------
| | Supervisory Board | | 419 | | 411 | | 830 |
--------------------------------------------------------------------------------
| | Committee of Shareholders | | 63 | | 64 | | 127 |
--------------------------------------------------------------------------------
| | Staff costs | | | | | | |
--------------------------------------------------------------------------------
| | Salaries including | | 46,299 | | 42,670 | | 88,171 |
| | share-based remuneration | | | | | | |
--------------------------------------------------------------------------------
| | Pensions | | 4,675 | | 4,307 | | 9,001 |
--------------------------------------------------------------------------------
| | Social security costs and | | 5,612 | | 4,966 | | 10,058 |
| | payroll tax | | | | | | |
--------------------------------------------------------------------------------
| | Other administrative | | 42,106 | | 43,048 | | 86,502 |
| | expenses | | | | | | |
--------------------------------------------------------------------------------
| | Total staff costs and | | 100,43 | | 96,602 | | 196,942 |
| | administrative expenses | | 4 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Average number of full-time | | 213 | | 207 | | 210 |
| | employees | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | The Executive Board is subject to an option programme that includes |
| | allotment of a total of 12,000 shares. The options may be exercised |
| | from 1 January 2012, and the maximum value of the option programme is |
| | DKK 6m. |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 6. Profit/loss from | | | | | | |
| | investments in associates | | | | | | |
| | and group enterprises | | | | | | |
--------------------------------------------------------------------------------
| | Profit/loss from | | 0 | | 0 | | 0 |
| | investments in associates | | | | | | |
--------------------------------------------------------------------------------
| | Profit/loss from | | -67 | | -27 | | 92 |
| | investments in group | | | | | | |
| | enterprises | | | | | | |
--------------------------------------------------------------------------------
| | Total profit/loss from | | -67 | | -27 | | 92 |
| | investments in associates | | | | | | |
| | and group enterprises | | | | | | |
--------------------------------------------------------------------------------
Subsidiaries and associates comprise:
--------------------------------------------------------------------------------
| Name | Register | Activity | Owner | Equity at | Profit/- |
| | -ed in | | ship | 31 Dec | loss |
| | | | | 2007 | 2007 |
--------------------------------------------------------------------------------
| LokalBolig | Hillerød | Management | 78 % | 574 | 150 |
| a/s | | company for | | | |
| | | joint marketing | | | |
| | | activities | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Lokal-Invest | Hillerød | Finance company | 100 % | 368 | -7 |
| ApS | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| MatchPoint | Græsted | Consulting | 23 % | 10,000 | * |
| Virksomhedsmæ | | company | | | |
| g-lerne A/S | | | | | |
--------------------------------------------------------------------------------
* The first financial year of MatchPoint Virksomhedsmæglerne A/S ends 31
December 2008. So there is no income statement for the year ended 31 December
2007. The company is an associate.
--------------------------------------------------------------------------------
| | Notes | | Individ | | Group-b | | Total |
| | (DKK'000) | | ual | | ased | | |
| | | | impair | | impair | | |
| | | | ment | | ment | | |
| | | | losses | | losses | | |
| | | | DKK'000 | | DKK'000 | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 7. Loans, advances and | | | | | | |
| | other receivables at | | | | | | |
| | amortised cost | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Impairment losses on | | | | | | |
| | loans, advances and other | | | | | | |
| | receivables | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | H1 2008 | | | | | | |
--------------------------------------------------------------------------------
| | Impairment losses at 1 | | 113,665 | | 27,513 | | 141,17 |
| | January 2008 | | | | | | 8 |
--------------------------------------------------------------------------------
| | Impairment losses for the | | 47,945 | | 0 | | 47,945 |
| | period | | | | | | |
--------------------------------------------------------------------------------
| | Reversal of impairment | | 23,585 | | 3,069 | | 26,654 |
| | losses in prior financial | | | | | | |
| | years | | | | | | |
--------------------------------------------------------------------------------
| | Finally lost, previously | | 20,577 | | 0 | | 20,577 |
| | written down for | | | | | | |
| | impairment | | | | | | |
--------------------------------------------------------------------------------
| | Impairment losses at 30 | | 117,447 | | 24,444 | | 141,89 |
| | June 2008 | | | | | | 1 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | H1 2007 | | | | | | |
--------------------------------------------------------------------------------
| | Impairment losses at 1 | | 121,986 | | 21,594 | | 143,58 |
| | January 2007 | | | | | | 0 |
--------------------------------------------------------------------------------
| | Impairment losses for the | | 28,215 | | 0 | | 28,215 |
| | period | | | | | | |
--------------------------------------------------------------------------------
| | Reversal of impairment | | 39,754 | | 21 | | 39,775 |
| | losses in prior financial | | | | | | |
| | year | | | | | | |
--------------------------------------------------------------------------------
| | Finally lost, previously | | 164 | | 0 | | 164 |
| | written down for | | | | | | |
| | impairment | | | | | | |
--------------------------------------------------------------------------------
| | Impairment losses at 30 | | 110,283 | | 21,573 | | 131,85 |
| | June 2007 | | | | | | 6 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | FY 2007 | | | | | | |
--------------------------------------------------------------------------------
| | Impairment losses at 1 | | 121,986 | | 21,594 | | 143,58 |
| | January 2007 | | | | | | 0 |
--------------------------------------------------------------------------------
| | Impairment losses for the | | 78,087 | | 5,919 | | 84,006 |
| | period | | | | | | |
--------------------------------------------------------------------------------
| | Reversal of impairment | | 84,347 | | 0 | | 84,347 |
| | losses in prior financial | | | | | | |
| | years | | | | | | |
--------------------------------------------------------------------------------
| | Finally lost, previously | | 2,062 | | 0 | | 2,062 |
| | written down for | | | | | | |
| | impairment | | | | | | |
--------------------------------------------------------------------------------
| | Impairment losses at 31 | | 113,665 | | 27,513 | | 141,17 |
| | December 2007 | | | | | | 8 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Impairment losses at period-end have been | | | | |
| | deducted from the loans and advances | | | | |
| | balance. | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Notes | | Indivi | | Group- | | Total |
| | (DKK'000) | | dual | | based | | |
| | | | provi- | | provi- | | |
| | | | sions | | sions | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 8. Provisions for loss | | | | | | |
| | on guarantees | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | H1 2008 | | | | | | |
--------------------------------------------------------------------------------
| | Provisions at 1 January | | 8,887 | | 5,823 | | 14,71 |
| | 2008 | | | | | | 0 |
--------------------------------------------------------------------------------
| | Provisions for the | | 7,038 | | 65 | | 7,103 |
| | period | | | | | | |
--------------------------------------------------------------------------------
| | Reversal of provisions | | 6,880 | | 0 | | 6,880 |
| | for prior financial | | | | | | |
| | years | | | | | | |
--------------------------------------------------------------------------------
| | Finally lost, previously | | 0 | | 0 | | 0 |
| | provided for | | | | | | |
--------------------------------------------------------------------------------
| | Provisions at 30 June | | 9,045 | | 5,888 | | 14,93 |
| | 2008 | | | | | | 3 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | H1 2007 | | | | | | |
--------------------------------------------------------------------------------
| | Provisions at 1 January | | 0 | | 10,510 | | 10,51 |
| | 2007 | | | | | | 0 |
--------------------------------------------------------------------------------
| | Provisions for the | | 0 | | 417 | | 417 |
| | period | | | | | | |
--------------------------------------------------------------------------------
| | Reversal of provisions | | 0 | | 0 | | 0 |
| | for prior financial | | | | | | |
| | years | | | | | | |
--------------------------------------------------------------------------------
| | Finally lost, previously | | 0 | | 0 | | 0 |
| | provided for | | | | | | |
--------------------------------------------------------------------------------
| | Provisions at 30 June | | 0 | | 10,927 | | 10,92 |
| | 2007 | | | | | | 7 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | FY 2007 | | | | | | |
--------------------------------------------------------------------------------
| | Provisions at 1 January | | 0 | | 10,510 | | 10,51 |
| | 2007 | | | | | | 0 |
--------------------------------------------------------------------------------
| | Provisions for the | | 8,887 | | 0 | | 8,887 |
| | period | | | | | | |
--------------------------------------------------------------------------------
| | Reversal of provisions | | 0 | | 4,687 | | 4,687 |
| | for prior financial | | | | | | |
| | years | | | | | | |
--------------------------------------------------------------------------------
| | Finally lost, previously | | 0 | | 0 | | 0 |
| | provided for | | | | | | |
--------------------------------------------------------------------------------
| | Provisions at 31 | | 8,887 | | 5,823 | | 14,71 |
| | December 2007 | | | | | | 0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | | H1 | | H1 | | FY |
| | | 2008 | | 2007 | | 2007 |
--------------------------------------------------------------------------------
| | 9. Contingent | | | | | | |
| | liabilities | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Financial guarantees | | 744,10 | | 2,357, | | 1,380,551 |
| | | | 4 | | 000 | | |
--------------------------------------------------------------------------------
| | Loss guarantees for | | 320,04 | | 0 | | 0 |
| | mortgage loans | | 0 | | | | |
--------------------------------------------------------------------------------
| | Other guarantees | | 472,82 | | 693,23 | | 501,181 |
| | | | 5 | | 9 | | |
--------------------------------------------------------------------------------
| | Total guarantees, etc | | 1,536, | | 3,050, | | 1,881,732 |
| | | | 969 | | 239 | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Other contingent | | | | | | |
| | liabilities | | | | | | |
--------------------------------------------------------------------------------
| | Other liabilities | | 3,966 | | 4,569 | | 4,569 |
--------------------------------------------------------------------------------
| | Total other contingent | | 3,966 | | 4,569 | | 4,569 |
| | liabilities | | | | | | |
--------------------------------------------------------------------------------
