Danske's Irish loan losses

Danske have reported loan loss levels for Q3 in Ireland that equal 320bps when annualised.

Most of the charges taken relate to commercial property exposure.

320 bps. Didn’t AIB forecast 110 bps for 2009? I wonder if the residential/commercial split is significantly different between the two.

The biggest read accross is for Anglo, then AIB as far as I can see.

AIB’s loan book = 11% developer and with an additional 24% construction and property exposure (and 24% mortgages).

The auditors have been very busy in National Irish recently. The Danes came across to go through the accounts, and went through everything with, not a fine tooth comb, but a forensic tooth comb. They were absolute sticklers for detail, said my man on the ground. There were effectively 2 sets of auditors working in lockstep.

Carlsberg isn’t the only thing that the Danes hate to see leave. They are quite partial to holding onto their cash too.

The Property Pin doesn’t do cultural stereotyping, but if it did…


Not to be too pedantic but Danske/NIB have a better quality loan book in both residential and in commercial than most Irish banks.

If they reckoned that 320bp was prudent then all I can say is that the ‘native’ banks should operate at 320bp+ and that certain of them should assume MULTIPLES of 320bp . That would take one or two of them very close to the fraction in fractional reserve !

I take it that they mean that the 3.2% of their property loan book is now ‘impaired’ , in effect, or is that the complete loan book ??

That sort of impairment charge will effectively turn a profit of €130 million for the Irish division into a loss for twice that next year.

danskebank.com/en-uk/ir/Docu … f-2008.pdf

If NIB are writing down a charge on this scale then there can be no doubt but that our domestic 6 are collectively worthless!

I don’t see that they quantified the former either or am I missing something?

From Davys