Grønlandsbanken A/S
CVR no. 80050410
Notification to Nasdaq OMX Copenhagen
7/2023
Quarterly Report
Q1 2023
Quarterly Report
Q1 2023
1
Management’s review 2
Report for Q1 in headlines 2
Financial highlights for Q1 2023 4
Management’s review, Q1 2023 5
Management Statement 10
Income statement and statement of comprehensive income 12
Balance sheet 13
Statement of changes in equity 14
Overview of notes 16
Notes to the Quarterly Report 17
Contents
Quarterly Report
Q1 2023
Management’s review
2
Report for Q1 in headlines
Good start to 2023
The BANK of Greenland’s profit before tax for Q1 2023
amounts to DKK 49.4 million, compared to DKK 26.8 million
for Q1 2022. The profit before value adjustments and write-
downs is satisfactory at DKK 48.5 million, compared to DKK
38.2 million for the previous year.
Lending has increased by DKK 45 million since the end of 2022,
amounting to DKK 4,399 million at the end of Q1. It was ex-
pected that the continued favourable economic development in
Greenland would result in positive, but more subdued growth
in the Bank’s lending in 2023. Guarantees decreased by DKK 16
million from DKK 1,934 million at the end of 2022 to DKK
1,918 million at the end of Q1 2023.
Net interest and fee income increased by DKK 18.3 million to
DKK 104.1 million in Q1 2023 compared to the same period in
2022. The increase is primarily due to the record-high lending
volume and the development in the level of interest rates in
2022 and 2023. Compared to Q1 2022 loans and guarantees
increased by DKK 626 million up to the end of Q1 2023.
Total expenses including depreciation amounted to DKK 56.9
million at the end of Q1 2023, compared to DKK 49.2 million
for the same period in 2022.
The increase concerns personnel expenses as a consequence of
increases due to collective agreement-based adjustments and
an increase in the number of employees, as well as other ad-
ministrative expenses, where the increase can be attributed pri-
marily to IT costs and a few larger cost items of a one-off na-
ture.
At the end of Q1 2023, value adjustments show a capital gain
of DKK 7.9 million, compared to a capital loss of DKK 10.7 mil-
lion for the same period of 2022. The new interest rate trends
resulted in positive development in the Bank’s bond holdings.
Similarly, the Bank’s sector shareholdings also performed posi-
tively.
Impairments of loans and guarantees amounted to DKK 7.0
million in Q1 2023, compared to DKK 0.7 million in Q1 2022.
The Bank sees continued satisfactory creditworthiness in the
loan portfolio. In addition to the Bank’s individual impairment
models, a management supplement of DKK 39.1 million is allo-
cated. In particular, the supplement accommodates the risks as-
sociated with increasing inflation and interest rates, and greater
cyclical uncertainty.
In the announcement to the stock exchange of 24 April 2023,
the forecast for the year's profit before tax was changed from
a range of DKK 130-170 million to a range of DKK 145-185
million, which is still maintained.
Management’s review
The profit before tax gives a return of 15.3 per cent p.a. on opening equity after disbursement of dividend.
An increase in loans and guarantees totalling DKK 29 million to DKK 6.317 billion.
Deposits increased to DKK 6.0 billion.
Core earnings per krone in costs of 1.85 in Q1 2023, compared to 1.78 in Q1 2022.
Write-downs and provisions of 0.1 per cent for the period.
Quarterly Report
Q1 2023
Management’s review
3
Quarterly Report
Q1 2023
Management’s review
4
Financial highlights for Q1 2023
Q1
Q1
Full year
Q1
Q1
Q1
2023
2022
2022
2021
2020
2019
Net interest and fee income
104,056
85,747
351,485
86,095
82,880 80,554
Value adjustments
7,907
-10,667
-39,356
3,127
-11,636
3,214
Other operating income
1,392
1,635
6,588
1,139
1,087
1,495
Staff and administration expenses
54,390
47,063
195,056
47,123
44,592 43,220
Depreciation and impairment of tangible assets
2,060
1,829
7,320
1,740
1,707
1,722
Other operating expenses
464
305
2,706
406
212
627
Write
-downs on loans and receivables, etc. 6,992
718
4,523
922
9,190 1,820
Profit before tax
49,449
26,800
109,112
40,170
16,630
37,874
Tax
3,362
-10,900
10,361
-1,281
4,404 12,043
Profit for the period
46,087
37,700
98,751
41,451
12,226
25,831
Selected balance sheet items:
Lending
4,398,940
3,904,824
4,353,585
3,905,129
3,636,588 3,628,717
Deposits
6,012,091
5,542,272
5,942,479
5,571,272
5,742,351 5,238,496
Equity
1,329,742
1,236,483
1,318,592
1,174,147
1,090,630 988,813
Total assets
8,057,981
7,372,841
7,949,566
7,177,469
7,183,145 6,536,682
Contingent liabilities
1,917,778
1,786,028
1,934,125
1,804,673
1,514,627 1,270,841
Key figures:
Capital ratio
23.0
24.4
23.6
22.3
24.6 21.8
Core capital ratio
22.6
24.4
23.2
22.3
24.6 21.8
Return on equity before tax for the period
3.7
2.1
8.4
3.4
1.5 3.8
Return on equity after tax for the period
3.5
3.0
7.6
3.5
1.1 2.6
Income per cost krone
1.8
1.5
1.5
1.8
1.3 1.8
Rate of
return 0.6
0.5
1.2
0.6
0.2 0.4
Interest risk rate
1.3
1.2
1.2
1.6
1.0 2.3
Foreign exchange position
0.5
0.8
0.5
0.7
0.7 0.3
Liquidity coverage ratio
230.9
236.7
220.5
290.9
284.8 293.5
Lending plus write
-downs as a ratio of deposits 71.4
68.8
71.5
70.1
64.3 71.3
Lending as a ratio of equity
3.3
3.2
3.3
3.3
3.3 3.7
Growth in lending for the period
1.0
3.2
15.1
-2.5
-3.2 4.5
Sum of large exposures
165.5
164.0
167.3
163.6
159.8 162.6
Write
-down ratio for the period 0.1
0.0
0.1
0.0
0.2 0.0
Accumulated
write-down ratio 3.1
3.2
3.0
3.2
3.5 3.4
Profit per share after tax for the period
25.6
20.9
54.9
23.0
6.8 14.4
Net book value per share
738.7
686.0
732.6
652.0
606.0 549.0
Stock exchange quotation/net book value per share
0.8
0.9
0.8
1.0
0.8 1.0
Quarterly Report
Q1 2023
Management’s review
5
Management’s review, Q1 2023
Statement of income
At TDKK 73,969, compared to TDKK 56,624 in Q1 2022, net
interest income increased by more than 30 per cent. The rising
level of interest rates during the second half of 2022 and into
2023, and the increasing level of lending, are driving the growth.
Since July 2022, Danmarks Nationalbank has increased the in-
terest rate by 3.2 percentage points in total, which gives the
Bank higher income on the direct deposits at Danmarks Na-
tionalbank and also normalises the Bank’s earnings on deposits.
Fee and commission income decreased by TDKK 329 com-
pared to the same period of 2022. Lower investment activity
and insurance intermediation commission have a negative im-
pact on the item, while the increased guarantee volume and
pension area impact the item positively.
Share dividends increased by TDKK 1,289, which is due to tim-
ing differences in the disbursement date. Net interest and fee
income therefore also increased, and by TDKK 18,309 to
TDKK 104,056 for Q1 2023.
Other operating income amounts to TDKK 1,392, which is a
decrease of TDKK 243 from Q1 2022.
Staff and administration expenses amount to TDKK 54,390,
which is an increase of TDKK 7,327 compared to Q1 2022.
Staff expenses increased by TDKK 1,976 as a result of individual
staff increases and salary increases under collective agreements.
Administration expenses increased by TDKK 5,351. The in-
crease concerns IT costs, supplementary training of staff and
costs of a one-off nature that are not expected to continue in
the coming quarters.
Other operating expenses, which concern operation and
maintenance of the Bank’s office buildings, increased by TDKK
159 to TDKK 464 in Q1 2023, compared to the same period
of 2022. The increase is due to timing differences in the pay-
ment of costs.
Depreciation of property and fixtures and fittings amounts to
TDKK 2,060, compared to TDKK 1,829 for the same period in
2022. The difference is primarily related to the increasing de-
preciation of buildings.
The profit before value adjustments and write-downs is a satis-
factory TDKK 48,534, compared to TDKK 39,078 in Q1 2022.
Value adjustments represent a total capital gain of TDKK 7,907,
compared to a capital loss of TDKK 10,667 for the same pe-
riod of the previous year. The Bank’s holdings of sector equities
and the currency area developed favourably in Q1. At the same
time, based on the level of interest rates, the Bank’s bond hold-
ings also gave capital gains in Q1 2023.
Selected Highlights and Key Figures (not audited)
DKK 1,000
Q1
Q4
Q3
Q2
Q1
Q4
Q3
Q2
2023
2022
2022
2022
2022
2021
2021
2021
Net interest and fee income
104,056
96,307 87,370
82,061
85,747
89,871
80,914 82,053
Costs, depreciation and amorti-
sation
56,914
59,254 48,059
48,572
49,197
51,145
46,436 49,048
Other operating income
1,392
2,025
1,514
1,414
1,635
2,244
1,762
1,040
Profit before value adjustments
and write-downs
48,534
39,078
40,825
34,903
38,185
40,970
36,242
34,045
Value adjustments
7,907
6,316
-20,477
-14,528
-10,667
3,503
2,601
1,988
Write
-downs on loans, etc. 6,992
1,483 928
1,394
718
-33
-761 1,409
Profit before tax
49,449
43,911
19,420
18,981
26,800
44,506
39,604
34,624
Impairment of loans, etc. amounts to TDKK 6,992, compared
to TDKK 718 for the same period in 2022. The Bank does not
consider the increase to reflect a general shift in the credit risk,
and the creditworthiness of the loan portfolio is still considered
to be satisfactory. The impairment level is still modest and the
impairment ratio for the period is 0.1 per cent.
Despite uncertain macroeconomic prospects as a consequence
of rising inflation, a higher interest rate level and geopolitical in-
stability, Greenland and the BANK of Greenland’s customers
are not significantly challenged so far. However, the future eco-
nomic development is subject to uncertainty.
Quarterly Report
Q1 2023
Management’s review
6
In addition to the individual write-downs, on this basis the Bank
has maintained a significant management reserve of DKK 39.1
million to counter risks.
The profit before tax is TDKK 49,449, having increased by
TDKK 22,649 from the same period of 2022.
Balance sheet and equity
During Q1 the Bank’s lending saw a satisfactory increase of
TDKK 45,355 to TDKK 4,398,940, while the Bank’s guarantees
to customers decreased by TDKK 16,347 from the end of
2022 and amounted to TDKK 1,917,778 at the end of March
2023.
The Bank increased its bond holdings in Q1 2023, and at the
end of the quarter, bonds totalled TDKK 1,264,553.
At the end of March 2023, the Bank’s deposits, which predomi-
nantly comprise on-demand deposits, amounted to TDKK
6,012,091, which is an increase of TDKK 69,612 from the end
of 2022. The Bank continues to have a stable deposit/lending
ratio of approximately 136 per cent.
After payment of the dividend of TDKK 36,000 for 2022
adopted by the Annual General Meeting, the Bank's equity in-
creased from TDKK 1,318,592 to TDKK 1,329,742.
Total assets thereby increased by TDKK 108,415 to TDKK
8,057,981.
Uncertainty of recognition and measurement
The principal uncertainties concerning recognition and meas-
urement are related to write-downs on lending, provisions on
guarantees and non-utilised credit facilities, together with the
valuation of properties, unlisted securities and financial instru-
ments. The management assesses that the presentation of the
accounts is subject to an appropriate level of uncertainty.
Financial risks
The BANK of Greenland is exposed to various financial risks,
which are managed at different levels of the organisation. The
Bank’s financial risks consist of:
Credit risk: Risk of loss as a consequence of debtors’ or coun-
terparties’ default on actual payment obligations.
Market risk: Risk of loss as a consequence of fluctuation in the
fair value of financial instruments and derivative financial instru-
ments due to changes in market prices. The BANK of Green-
land classifies three types of risk within the market risk area: in-
terest rate risk, foreign exchange risk and share risk.
Liquidity risk: Risk of loss as a consequence of the financing
costs increasing disproportionately, the risk that the Bank is
prevented from maintaining the adopted business model due to
a lack of financing/funding, or ultimately, the risk that the Bank
cannot fulfil agreed payment commitments when they fall due,
as a consequence of the lack of financing/funding.
Operational risk: The risk that the Bank in full or in part incurs
financial losses as a consequence of inadequate or inappropri-
ate internal procedures, human errors, IT systems, etc.
Capital requirement
The BANK of Greenland must by law have a capital base that
supports the risk profile. The BANK of Greenland compiles the
credit and market risk according to the standard method and
the operational risk according to the basic indicator method.
MREL requirement
The requirement concerning own funds and eligible liabilities
must be viewed as an element of the recovery and resolution
of banks. This entails that banks which are subject to this re-
quirement must maintain a ratio of capital instruments and debt
obligations that, in a resolution situation, can be written down
or converted before simple claims.
On 6 December 2022, a revised MREL requirement was deter-
mined for the BANK of Greenland, at 29.4 per cent of the
Bank’s risk-weighted assets at the end of 2021. The MREL re-
quirement is being phased in during the period from 2022 to
2027. The linear phasing-in means that by 2023, the Bank must
fulfil an MREL requirement of 4.9 per cent. This means that in
the course of the coming years, the Bank must fulfil the phased-
in requirement by issuing capital instruments and consolidation
of equity capital.
In continuation of the established MREL requirement, the Bank
made issues in both 2021 and 2022. A total of DKK 75 million
was issued in Senior Non-Preferred and DKK 25 million in sub-
ordinated debt.
In 2023, the Bank also expects to issue securities.
Quarterly Report
Q1 2023
Management’s review
7
Capital requirement
Q1 2023
Year 2022
Pillar I
8.00%
8.00%
Pillar II
3.10%
3.10%
Solvency
requirement 11.10%
11.1%
SIFI buffer requirement
1.50%
1.50%
Capital reserve buffer requirement
2.50%
2.50%
Capital requirement
15.10%
15.1%
MREL requirement (phased in linearly as
from 1 January 2022)
4.90%
2.53%
Total capital requirement
20.00%
17.6%
Capital base, cf. Note 19
1,297,195
1,300,270
SNP issue
74,598
74,563
MREL capital base
1,371,793
1,374,833
MREL capital ratio
24.30%
25.00%
Surplus capital cover
4.30%
7.37%
Solid capital base
In accordance with the Danish Financial Business Act, the Board
of Directors and the Executive Management must ensure that
the BANK of Greenland has an adequate capital base. The capi-
tal requirement is the capital which, according to the manage-
ment’s assessment, as a minimum is needed to cover all risks.
The BANK of Greenland was designated as an SIFI institution in
April 2017.
Based on the requirements concerning own funds and eligible
liabilities, the Board of Directors expects that the total capital
reserves must be increased during the coming years. The aim of
the Board of Directors is that there must be sufficient capital
for growth in the Bank’s business activities, just as there must
be sufficient capital to cover ongoing fluctuations in the risks as-
sumed by the Bank.
In 2021, the Bank’s Board of Directors therefore adopted a
capital objective with a set target for CET1 of 24%. The BANK
of Greenland’s core capital ratio was 22.6 at the end of Q1
2023, and the capital ratio was 23.0.
For 2023, the Bank expects more subdued growth in risk-
weighted assets and higher earnings than in 2022, whereby the
capital ratio will be closer to the target at the end of the year.
The result for Q1 2023 has not been verified by the Bank’s au-
ditor and is therefore not included in the capital ratio. Including
the result for Q1 2023, the core capital ratio is calculated at
23.2 per cent and the capital ratio at 23.7 per cent.
As at the end of March 2023, the Bank's individual solvency re-
quirement was compiled at an unchanged 11.1 per cent. The
BANK of Greenland thereby has surplus capital cover before
the buffer requirement of 11.9 per cent, or TDKK 669,651. Af-
ter deductions for the capital reserve buffer requirement of 2.5
per cent and the SIFI buffer requirement of 1.5 per cent, the
surplus cover is 7.9 per cent.
The BANK of Greenland’s reported individual solvency requirement according to the 8+ model
Q1 2023
Year 2022
Capital require-
ment
Solvency re-
quirement
Capital require-
ment
Solvency re-
quirement
Pillar I requirement
451,501
8.0
440,087
8.0
Credit risk
126,886
2.2
119,785
2.2
Market risk
22,581
0.4
21,077
0.4
Operational risk
16,588
0.3
16,302
0.3
Other risk
10,018
0.2
15,323
0.2
Capital and solvency requirement
627,574
11.1
612,574
11.1
The BANK of Greenland has published further details of the
calculated solvency requirement in a report on its website
http://www.banken.gl/report/
Quarterly Report
Q1 2023
Mana
gement’s review
8
Liquidity
The liquidity coverage ratio (LCR) is a minimum requirement of
the ratio between current assets and liabilities, to ensure a satis-
factory liquidity ratio.
At the end of Q1, the Bank had an LCR of 230.9 per cent and
thereby fulfils the LCR requirement of at least 100 per cent.
The Bank’s funding is based solely on deposits.
The Supervisory Diamond for banks
The BANK of Greenland has considered the benchmarks set
out in the Danish FSA’s Supervisory Diamond for banks. The
Supervisory Diamond states five benchmarks for banking activi-
ties which the Bank aims to fulfil. It must be noted that publicly-
owned enterprises account for 43% points of the sum of large
exposures.
The exposure to property amounts to 22.1 per cent. This ex-
posure is subject to considerable subordinate public financing.
In addition, some of the exposure is based on lease contracts
with the state, the Government of Greenland or municipalities.
The Bank assesses that both of these factors contribute to sta-
bilising the overall sector exposure.
Investor relations
The BANK of Greenland’s overall financial objective is to
achieve a competitive return for the shareholders. At a price of
610 at the end of Q1 2023, the price of the BANK of Green-
land’s shares has increased from the end of 2022, when the
price was 590.
At the Bank’s Annual General Meeting on 28 March 2023, a
dividend payment of DKK 20 per share, or a total of DKK 36
million, to the Bank’s shareholders was adopted, and this was
paid out on 31 March 2023.
In accordance with Section 28a of the Danish Companies Act,
six shareholders have notified shareholdings in excess of 5%.
The Bank has no holdings of own shares.
The BANK of Greenland’s mission, values and cor-
porate governance
The BANK of Greenland conducts banking activities in Green-
land in open competition with domestic and foreign banks and
provides advice and services in the financial area to all citizens
and businesses in Greenland.
The Bank's mission should be viewed in a broader perspective
whereby the BANK of Greenland can be seen as the BANK for
all of Greenland. This entails an enhanced responsibility to par-
ticipate positively and actively in society’s development and to
help to create opportunities for the benefit of Greenland, while
also ensuring sound financial activities. The BANK of Greenland
is highly aware of this vital role.
The BANK of Greenland’s values are firmly anchored in the
Bank and its employees. The values are Commitment, Decency,
Customer-oriented and Development-oriented. These values
serve as a guide for how we act and wish to be seen within
and outside the Bank.
The BANK of Greenland considers all of the Corporate Gov-
ernance recommendations and the Danish Executive Order on
Management and Control of Banks, etc. and it is the Bank’s ob-
jective to observe these recommendations at all times and to
the greatest possible extent. The Bank’s Corporate Governance
Statement can be found on the Bank’s website www.banken.gl
.
Sum of large exposures
(maximum of 175% of actual core capital)
The Bank of Greenland 165.5 %
Growth in lending
(less than 20% per year)
The Bank of Greenland 12.7 %
Liquidity benchmark
(greater than 100 %)
The Bank of Greenland 232.8 %
Property exposure
(less than 25% of total loans and guarantees)
The Bank of Greenland 22.1 %
Stable funding
(Loans/working capital less bonds with a remaining maturity of less than 1 year) Limit value: Less than 1
The Bank of Greenland 0.6
Quarterly Report
Q1 2023
Management’s review
9
Outlook for the remainder of 2023
In spite of inflation and interest rate increases, the BANK of
Greenland expects economic growth in Greenland in 2023.
On this basis, lending is expected to develop positively towards
the end of the year, but with significantly lower growth than in
2022. Deposits are expected to be at the end-2022 level.
The Bank will be affected negatively if inflation and cyclical
trends are exacerbated or amplified to any significant degree.
Total core income is expected to increase in 2023, for which
the primary reasons are the expected increased lending volume
and the development in interest rates.
Total expenses including depreciation and amortisation are ex-
pected to be higher than in 2022. Increases are expected in the
personnel area. Administration expenses are also expected to
increase, primarily in the IT area and for supplementary staff
training and consultants.
The Bank assesses that the quality of the loan portfolio is satis-
factory. Write-downs for impairment of lending are therefore
expected to continue to be at a low level.
On the basis of the level of interest rates, gains must be ex-
pected on the Bank’s listed securities. However, the value ad-
justment of the fund portfolio is subject to uncertainty. Capital
gains are expected from the currency area and sector equities.
In the announcement to the stock exchange of 24 April 2023,
the forecast for the year's profit before tax was changed from
a range of DKK 130-170 million to a range of DKK 145-185
million, which is still maintained.
Quarterly Report
Q1 2023
Management Statement
10
The Board of Directors and Executive Management have today
considered and approved the quarterly report for the period 1
January – 31 March 2023, for the public limited liability com-
pany, GrønlandsBANKEN A/S.
The quarterly report is presented in accordance with the Dan-
ish Financial Business Act, and the Management’s Review is pre-
pared in accordance with the Danish Financial Business Act.
The quarterly report is furthermore prepared in accordance
with additional Danish disclosure requirements for listed finan-
cial companies.
It is our opinion that the quarterly report gives a true and fair
view of the Bank's assets, liabilities and financial position at 31
March 2023, and of the results of the Bank's operations for Q1
2023.
It is our opinion that the Management’s Review gives a true and
fair review of the development in the Bank’s activities and finan-
cial affairs, as well as a description of the significant risks and un-
certainties to which the BANK of Greenland is subject.
Management Statement
Nuuk, 9 May 2023
Executive Management
Martin Birkmose Kviesgaard
Board of Directors
Gunnar í Liða
Kristian Frederik Lennert
Maliina Bitsch Abelsen
Chair
Vice Chair
Lars Holst
Pilunnguaq Frederikke Johansen Kristiansen
Vitta Henriethe Møller Motzfeldt
Niels Peter Fleischer Rex
Peter Angutinguaq Wistoft
Ellen Dalsgaard Zdravkovic
Quarterly Report
Q1 2023
Management Statement
11
Quarterly Report Q1 2023
Income statement and statement of comprehensive income
12
Income statement and statement of comprehensive in-
come
DKK 1,000
Notes
Q1 2023
Full year 2022
Q1 2022
3
Interest income
86,831
227,093
52,402
4
Negative interest income
0
-1,824
-2,793
5
Interest expenses
12,862
3,040
260
6
Positive interest expenses
0
-20,995
-7,275
Net interest income
73,969
243,224
56,624
Share dividend, etc.
1,460
1,822
171
7
Fees and commission income
28,752
106,796
29,081
Fees paid and commission expenses
125
357
129
Net interest and fee income
104,056
351,485
85,747
8
Value adjustments
7,907
-39,356
-10,667
Other operating income
1,392
6,588
1,635
9
Staff and administration expenses
54,390
195,056
47,063
Depreciation and impairment of tangible assets
2,060
7,320
1,829
Other operating expenses
464
2,706
305
18
Write
-downs on loans and receivables, etc. 6,992
4,523
718
Profit before tax
49,449
109,112
26,800
10
Tax
3,362
10,361
-10,900
Profit for the period
46,087
98,751
37,700
COMPREHENSIVE INCOME
Profit for the period
46,087
98,751
37,700
Other comprehensive income:
Value adjustment of properties
1,417
32,030
1,124
Value adjustment of defined-benefit severance/pension scheme
0
-93
0
Tax on value adjustment of properties
-354
-8,007
-281
Other comprehensive income
1,063
23,930
843
Comprehensive income for the period
47,150
122,681
38,543
Quarterly Report Q1 2023
Balance sheet
13
Balance sheet
DKK 1,000
Notes
Assets
31 March 2023
31 December
2022
31 March 2022
Cash balance and demand deposits with central banks
1,322,534
1,396,401
1,405,167
11
Receivables from credit institutions and central banks
129,642
118,619
122,300
18
Loans and other receivables at amortised cost
4,398,940
4,353,585
3,904,824
12
Bonds at fair value
1,264,553
1,156,821
1,088,019
Shares, etc.
127,396
120,063
117,475
13
Assets connected to pool schemes
406,401
394,576
381,028
Land and
buildings in total 284,038
284,370
247,261
-
Domicile properties 284,038
284,370
247,261
Other tangible assets
6,202
6,007
6,714
Other assets
113,622
115,145
95,227
Accruals and deferred income
4,653
3,979
4,826
Total assets
8,057,981
7,949,566
7,372,841
Liabilities
Liabilities to credit institutions and central banks
21,678
22,598
9,128
14
Deposits and other liabilities
6,012,091
5,942,479
5,542,272
Deposits in pool schemes
406,401
394,576
381,028
15
Issued bonds at amortised cost
74,598
74,563
49,665
Current tax liabilities
30,829
18,861
29,677
Other liabilities
72,183
58,527
50,453
Prepayments and deferred expenses
3,411
7,535
3,526
Total debt
6,621,191
6,519,139
6,065,749
Provisions for pensions and similar obligations
2,172
2,097
1,771
Provisions for deferred tax
58,480
67,126
50,607
Provisions for losses on guarantees
12,041
8,036
10,362
Other provisions
4,841
5,047
5,144
Provisions for
losses on non-utilised credit facilities 4,791
4,821
4,754
Total provisions
82,325
87,127
72,638
16
Subordinated debt
24,723
24,708
0
Total subordinated debt
24,723
24,708
0
Equity
17
Share capital
180,000
180,000
180,000
Revaluation reserves
62,714
61,651
38,471
Retained earnings
1,087,028
1,040,941
1,015,983
Proposed dividend
0
36,000
0
Total equity
1,329,742
1,318,592
1,234,454
Total liabilities
8,057,981
7,949,566
7,372,841
1
Accounting policies applied
2
Accounting estimates
19
Contingent liabilities
20
Capital conditions and solvency
Quarterly Report Q1 2023
Statement of changes in equity
14
Statement of changes in equity
DKK 1,000
Share capital
Revaluation
reserves
Retained
earnings
Proposed divi-
dend
Total equity
capital
Equity, 01 January 2022
180,000
37,628 978,283
72,000
1,267,911
Dividend paid
0
0
0
-72,000
-72,000
Other comprehensive income
0
843
0
0
843
Profit for the period
0
0 37,700
0
37,700
Equity, 31 March 2022
180,000
38,471
1,015,983
0
1,234,454
Other comprehensive income
0
23,180 -93
0
23,087
Profit for the period
0
0 25,051
36,000
61,051
Equity, 31 December 2022
180,000
61,651 1,040,941
36,000
1,318,592
Equity, 01 January 2023
180,000
61,651 1,040,941
36,000
1,318,592
Dividend paid
0
0 0
-36,000
-36,000
Other comprehensive income
0
1,063 0
0
1,063
Profit for the period
0
46,087
0
46,087
Equity, 31 March 2023
180,000
62,714 1,087,028
0
1,329,742
Quarterly Report Q1 2023
Statement of changes in equity
15
Quarterly Report Q1 2023
16
1. Accounting policies applied etc. 17
2. Significant accounting estimates 17
3. Interest income 18
4. Negative interest income 18
5. Interest expenses 18
6. Positive interest expenses 18
7. Fee and commission income 18
8. Value adjustments 18
9. Staff and administration expenses 19
10. Tax 19
11. Amounts receivable from credit institutions and central banks 19
12. Bonds 19
13. Assets connected to pool schemes 20
14. Deposits 20
15. Issued bonds at amortised cost 20
16. Subordinated debt 20
17. Share capital 20
18. Loans 21
19. Contingent liabilities 24
20. Capital conditions and solvency 25
Overview of notes
Quarterly Report Q1 2023
Notes to the Quarterly Report
17
The Interim Report has been prepared in accordance with the
Danish Financial Business Act, the statutory order on financial
reports for credit institutions and investment service compa-
nies, etc. and the Danish disclosure requirements for the in-
terim reports of listed financial companies.
The accounting policies applied are unchanged from the Annual
Report for 2022.
Tax, which consists of current tax and changes in deferred tax,
is recognised in the income statement when it relates to the
profit for the period, and directly in equity when it can be at-
tributed to items carried directly to equity.
On calculating the taxable income, Greenland allows tax deduc-
tion of dividends for the dividend-paying company. The taxation
value of this is therefore added to equity at the time of the An-
nual General Meeting’s approval of the dividend.
Deferred tax assets are recognised in the balance sheet at the
value at which the asset is expected to be realised. The interim
report has not been audited or reviewed.
The calculation of the accounting value of certain assets and lia-
bilities is subject to a degree of uncertainty and an estimate of
how future events will affect the value of these assets and liabil-
ities. The most significant estimates relate to:
• measurement of loans, guarantees and non-utilised credit
facilities;
• financial instruments;
• fair value of domicile properties; and
• provisions.
Non-listed financial instruments that primarily concern sector
equities and that are measured at estimated fair values.
The measurement of the fair value of the Bank’s head office
properties is subject to significant accounting estimates and as-
sessments, including expectations of the properties’ future re-
turns and the fixed yield ratios.
For provisions, there are significant estimates related to the de-
termination of the future employee turnover rate, as well as
determining the interest obligation for tax-free savings accounts.
Notes to the Quarterly Report
1.
Accounting policies applied etc.
2.
Significant accounting estimates
Quarterly Report Q1 2023
Notes to the Quarterly Report
18
DKK 1,000
Q1
2023
Full year
2022
Q1
2022
3. Interest income
Lending and other receivables
71,724
218,531
51,176
Bonds
6,474
7,412
1,226
Foreign exchange, interest rate, equity, commodity and other contracts, as
well as derivative financial instruments
246
0
0
Total interest income
86,831
227,093
52,402
4. Negative interest income
Receivables from credit institutions and central banks
0
-1,074
-2,476
Foreign exchange, interest rate, equity, commodity and other contracts, as
well as derivative
financial instruments
0
-750
-317
Total negative interest
0
-1,824
-2,793
5. Interest expenses
Credit institutions and central banks
47
0
6
Deposits and other liabilities
12,815
3,040
254
Total interest expenses
12,862
3,040
260
6. Positive interest expenses
Deposits and other liabilities
0
-11
0
Deposits and other liabilities
0
-20,984
-7,275
Total positive interest expenses
0
-20,995
-7,275
7. Fee and commission income
Securities and securities accounts
680
8,629
1,090
Payment settlement
8,961
38,042
8,951
Loan transaction fees
1,311
5,589
1,173
Guarantee commission
8,181
32,228
7,571
Other fees and commission
9,619
22,308
10,296
Total fee and commission income
28,752
106,796
29,081
8. Value adjustments
Lending at fair value
414
-7,577
-2,904
Bonds
4,949
-49,488
-13,266
Shares
1,603
4,486
1,445
Currency
1,365
5,473
1,253
Foreign exchange, interest rate, equity, commodities and other contracts, as
well as derivative financial instruments
-424
7,750
2,805
Total value adjustments
7,907
-39,356
-10,667
Quarterly Report Q1 2023
Notes to the Quarterly Report
19
DKK 1,000
Q1
2023
Full year
2022
Q1
2022
9. Staff and administration expenses
Staff expenses
Salaries 23,016
91,485
21,620
Other staff expenses 1,069
2,271
618
Pensions 2,802
10,979
2,691
Social security expenses 133
484
115
In total 27,020
105,219
25,044
Other
administration expenses 27,370
89,837
22,019
Average number of FTEs
139.3
137.4
137.7
Of which salaries and remuneration to the Board of Directors and the Exec-
utive Management
1,711
5,788
1,522
Five other employees (Q1 2021: four employees) whose activities have a sig-
nificant influence on the Bank’s risk profile:
Salaries and pensions, including free car and other benefits
1,753
6,124
1,621
10. Tax
25
-% of the profit before tax 12,362
27,278
6,659
Discount for dividend tax paid
-394
-430
-38
6
-%-supplement 0
1,637
441
Total tax on ordinary
profit 11,968
28,485
7,062
Paid dividend tax
394
430
38
Change in deferred tax as a consequence of a change in the corporate tax
supplement
0
-528
0
Adjustment to deferred tax prior year
0
1,080
1,080
Other changes
0
-26
0
Taxation value of dividend paid
-9,000
-19,080
-19,080
Tax in total
3,362
10,361
-10,900
Deferred tax
354
-8,779
1,361
Taxation value of dividend paid
-9,000
0
-19,080
Tax to be paid
12,008
19,140
6,819
No
company tax was paid in the period.
11. Amounts receivable from credit institutions and central banks
Receivables from credit institutions 129,642
118,619
122,300
Total amounts receivable
129,642
118,619
122,300
12. Bonds
Of the bond portfolio, a nominal amount of TDKK 50,000 is pledged as collateral for accounts
with Danmarks Nationalbank.
Quarterly Report Q1 2023
Notes to the Quarterly Report
20
DKK 1,000
Q1
2023
Full year
2022
Q1
2022
13. Assets connected to pool schemes
Investment associations
406,100
394,308
381,005
Non
-invested funds 301
268
23
Total
406,401
394,576
381,028
14. Deposits
On demand
5,382,245
5,241,972
5,014,523
On terms of notice
362,598
442,216
285,564
Special deposit conditions
267,248
258,291
242,185
Total deposits
6,012,091
5,942,479
5,542,272
15. Issued bonds at amortised cost
Bond issue
74,598
74,563
49,665
Total
74,598
74,563
49,665
Loan raised as Senior Non
-Preferred, nominally 50,000
50,000
50,000
The loan was raised as Senior Non
-Preferred on 27 October 2021 and falls
due for full redemption on 27 October 2026. The Bank has the option of
early redemption as from 27 October 2025.
Loan raised as Senior
Non-Preferred, nominally 25,000
25,000
The loan was raised as Senior Non
-Preferred on 2 September 2022 and falls
due for full redemption on 2 September 2027. The Bank has the option of
early redemption as from 2 September 2026.
16. Subordinated debt
Capital
certificate as below 24,723
24,708
0
In total
24,723
24,708
0
Subordinated debt included in the capital base according to CRR
24,723
24,708
0
Loan raised as subordinated debt, nominally
25,000
25,000
Interest rate,
fixed rate 6.197%
6.197%
The loan was raised on 2 September 2022 and falls due for full redemption
on 2
September 2032. The Bank has the option of early redemption as from
2 September 2027.
17. Share capital
Share capital consists of 1,800,000 shares of DKK 1,000
Own shares
Number of own shares
0
0
0
Quarterly Report Q1 2023
Notes to the Quarterly Report
21
DKK 1,000
Q1
2023
Full year
2022
Q1
2022
18. Loans
Write
-downs on loans, guarantees and non-utilised credit facilities:
New write
-downs concerning new facilities during the period 1,733
20,471
4,325
Reversal of write
-downs concerning redeemed facilities -3,651
-17,415
-5,301
Net
write-downs during the period as a consequence of changes in the
credit risk
9,163
3,146
1,688
Losses without preceding write
-downs 40
593
342
Received for claims previously written off
-293
-2,272
-336
Recognised in the statement of income
6,992
4,523
718
DKK 1,000
Stage 1 Stage 2
Stage 3
Total
Write-downs on loans
31.03.2023
Start of the period
28,826 64,706
86,477
180,009
New write
-downs concerning new facilities during the
year
967 325
283
1,575
Reversal of
write-downs concerning redeemed facilities -1,609 -841
-671
-3,121
Change in write
-downs at the beginning of the year –
transfer to stage 1
2,811 -2,301
-510
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-405 2,144
-1,739
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-104 -259
363
0
Net write
-downs as a consequence of changes in the
credit risk
-4,183 757
8,242
4,816
Previously written down, now finally lost
-379
-379
Interest on written
-down facilities
1,188
1,188
Write-downs in total
26,303
64,531
93,254
184,088
Write-downs on guarantees
31.03.2023
Start of the period
1,239 1,025
5,772
8,036
New write
-downs concerning new facilities during the
year
140 3
0
143
Reversal of write
-downs concerning redeemed facilities -1 -2
-43
-46
Change in write
-downs at the beginning of the year –
transfer to stage 1
604 -41
-563
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-56 81
-25
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-10 -48
58
0
Net write
-downs as a consequence of changes in the
credit risk
-700 311
4,297
3,908
Write
-downs in total 1,216 1,329
9,496
12,041
Quarterly Report Q1 2023
Notes to the Quarterly Report
22
DKK
1,000
Stage 1 Stage 2
Stage 3
Total
Write-downs on non-utilised drawing rights
31.03.2023
Start of the period
498 547
3,776
4,821
New write
-downs concerning new facilities during the
year
4 0
11
15
Reversal of write
-downs concerning redeemed facilities -39 -15
-430
-484
Change in write
-downs at the beginning of the year –
transfer to stage 1
220 -217
-3
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-1 8
-7
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
0 0
0
0
Net write
-downs as a consequence of changes in the
credit risk
141 153
145
439
Write
-downs in total 823 476
3,492
4,791
Write-downs on loans
31.12.2022
Start of the period
21,314 67,951
85,104
174,369
New write
-downs concerning new facilities during the
year
4,545 9,913
4,518
18,976
Reversal of write
-downs concerning redeemed facilities -1,757 -3,774
-11,039
-16,570
Change in write
-downs at the beginning of the year –
transfer to stage 1
17,776 -14,283
-3,493
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-1,072 6,416
-5,344
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-54 -4,530
4,584
0
Net
write-downs as a consequence of changes in the
credit risk
-11,926 3,013
12,326
3,413
Previously written down, now finally lost
-3,445
-3,445
Interest on written
-down facilities
3,266
3,266
Write
-downs in total 28,826 64,706
86,477
180,009
Write-downs on guarantees
31.12.2022
Start of the period
744 2,071
4,858
7,673
New write
-downs concerning new facilities during the
year
507 547
252
1,306
Reversal of write
-downs concerning redeemed facilities -2 -36
-179
-217
Change in write
-downs at the beginning of the year –
transfer to stage 1
1,505 -1,370
-135
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-68 1,036
-968
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-3 -86
89
0
Net write
-downs as a consequence of changes in the
credit risk
-1,444 -1,137
1,855
-726
Write
-downs in total 1,239 1,025
5,772
8,036
Quarterly Report Q1 2023
Notes to the Quarterly Report
23
DKK 1,000
Stage 1 Stage 2
Stage 3
Total
Write-downs on non-utilised drawing rights
31.12.2022
Start of the period
1,203 1,037
2,561
4,801
New write
-downs concerning new facilities during the
year
25 80
84
189
Reversal of write
-downs concerning redeemed facilities -231 -166
-231
-628
Change in
write-downs at the beginning of the year –
transfer to stage 1
557 -555
-2
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-41 724
-683
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-1 0
1
0
Net write
-downs as a consequence of changes in the
credit risk
-1,014 -573
2,046
459
Write
-downs in total 498 547
3,776
4,821
Write-downs on loans
31.03.2022
Start of the period
21,314 67,951
85,104
174,369
New write
-downs concerning new facilities during the
year
1,125 1,975
753
3,853
Reversal of write
-downs concerning redeemed facilities -772 -407
-3,839
-5,018
Change in write
-downs at the beginning of the year –
transfer to stage 1
14,974 -12,593
-2,381
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-390 1,232
-842
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-12 -1,314
1,326
0
Net write
-downs as a consequence of changes in the
credit
risk
-21,468 10,685
10,018
-765
Previously written down, now finally lost
-2,852
-2,852
Interest on written
-down facilities
1,280
1,280
Write
-downs in total 14,771 67,529
88,567
170,867
Write-downs on guarantees
31.03.2022
Start of
the period 744 2,071
4,858
7,673
New write
-downs concerning new facilities during the
year
135 224
38
397
Reversal of write
-downs concerning redeemed facilities 0 -23
-35
-58
Change in write
-downs at the beginning of the year –
transfer to
stage 1
1,559 -1,524
-35
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-10 49
-39
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-3 -44
47
0
Net write
-downs as a consequence of changes in the
credit risk
-1,401 290
3,461
2,350
Write
-downs in total 1,024 1,043
8,295
10,362
Quarterly Report Q1 2023
Notes to the Quarterly Report
24
DKK 1,000
Stage 1 Stage 2
Stage 3
Total
Write-downs on non-utilised drawing rights
31.03.2022
Start of the period
1,203 1,037
2,561
4,801
New
write-downs concerning new facilities during the
year
74 0
1
75
Reversal of write
-downs concerning redeemed facilities -88 -104
-33
-225
Change in write
-downs at the beginning of the year –
transfer to stage 1
296 -290
-6
0
Change in
write-downs at the beginning of the year –
transfer to stage 2
-8 8
0
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
0 0
0
0
Net write
-downs as a consequence of changes in the
credit risk
-330 -223
656
103
Write
-downs in total 1,147 428
3,179
4,754
DKK 1,000
Q1
2023
Full year
2022
Q1
2022
19. Contingent liabilities
Mortgage finance guarantees
1,000,642
989,198
1,004,580
Registration and remortgaging guarantees
266,290
300,180
182,416
Other
guarantees 650,846
644,747
599,032
Guarantees, etc. in total
1,917,778
1,934,125
1,786,028
Provision balance for guarantees
12,041
8,036
10,362
Provision balance for non
-utilised credit facilities 4,791
4,821
4,754
The Bank is a member of BEC (BEC Financial Technologies a.m.b.a.). On any
withdrawal the Bank will be obliged to pay a withdrawal fee to BEC equiva-
lent to the preceding three years’ IT costs.
Like the rest of the Danish banking sector, the Bank has an obli
gation to
make payments to the Guarantee Fund and the Resolution Fund.
Quarterly Report Q1 2023
Notes to the Quarterly Report
25
DKK 1,000
Q1
2023
Full year
2022
Q1
2022
20. Capital conditions and solvency
Credit risk
4,735,268
4,619,420
4,067,384
CVA risk
12,049
13,892
6,154
Market risk
267,648
238,978
212,905
Operational risk
628,793
628,793
639,644
Total risk exposure
5,643,758
5,501,083
4,926,087
Equity at the beginning of the period
1,318,592
1,267,911
1,267,911
Comprehensive income for the period
0
122,681
0
Adjustment to deferred tax prior year
0
0
-1,080
Proposed dividend, accounting effect
9,000
-27,000
19,080
Paid dividend
-36,000
-72,000
-72,000
Framework for ratio of own shares
-10,980
-10,620
-11,124
Deductions for
prudent valuation -1,684
-1,568
-1,456
Deductions for Non
-Performing Exposures -6,456
-3,842
-1,484
Actual core capital
1,272,472
1,275,562
1,199,847
Supplementary capital
24,753
24,708
0
Capital base
1,272,472
1,275,562
1,199,847
Actual core capital ratio
23.0
23.6
24.4
Capital ratio
22.6
23.2
24.4
Statutory capital ratio requirements
8.0
8.0
8.0
Quarterly Report Q1 2023
Notes to the Quarterly Report
26