Faaborg, Denmark, 2012-08-13 17:59 CEST (GLOBE NEWSWIRE) -- Overwiew
An expected group net profit for first half year 2012 amounting to a loss of approx. DKK 220m was published in company announcement number 10 on 15 June 2012. The group net profit is negative by DKK 223m and thus in harmony with the published expectations. The increased loan impairment charges, which are a consequence of the Danish FSA’s stricter rules for loan impairment charges and the economic difficulties, which the Foundation of Sparekassen Faaborg are suffering from, leave their mark on the results for first half year 2012.
The level for impairment charges amounting to DKK 342m is not at all acceptable, whereas the group core earnings before impairments can be considered acceptable.
The group core earnings before loan impairment charges etc., adjusted for interest income on the impaired loans and advances, have developed very well and show an increase of DKK 3,3m.
The core expenses have increased to DKK 119,8m corresponding to 3.4 percent. The increase comes from opening of new branches and a higher payroll tax.
The investment portfolio earnings amount to DKK 13,7m compared to DKK 6,2m in 2011.
The group pre-tax profit is negative by DKK 297,0m.
Since the end of 2011 loans and advances have fallen by DKK 279m to DKK 4,2b as a consequence of the impairment charges; otherwise loans and advances would have increased slightly.
Deposits inclusive of pool deposits have increased by DKK 708m to DKK 4,8b.
The objective of having balance between loans and advances and deposits has now been achieved, and therefore it is possible again to work on increasing the group loans and advances.
The group solvency ratio is 14 and the core capital ratio is 12. The surplus concerning the individual solvency need is 2 percentage points.
The liquidity is very satisfactory with a surplus of 204.4 percent.
Outlook financial year 2012
Due to the negative results for first half year 2012 the bank is expecting core earnings before loan impairment charges etc. at a lower level than in 2011. The main reason is that the interest income on the impaired loans and advances must not be recognised as interest income, but adjusted in the loan impairment charges.
The board of directors
On 19 July 2012 four board members decided to resign from the board as a consequence of the rules of article 64 of the Danish FBA. Further information can be found in company announcement number 12.
CEO Claus Sejling, phone no. +45 6361 1814
