Aabenraa, Denmark, 2014-02-19 08:27 CET (GLOBE NEWSWIRE) --
The Sydbank Group posted a profit after tax of DKK 187m in 2013. The result is unsatisfactory due to the previously announced extraordinary impairment charges for loans and advances in Q4 2013, resulting in a loss of DKK 282m for the quarter. The year’s core income and costs are on a par with expectations.
As a consequence of the extraordinary impairment charges in Q4 2013, the Group has implemented measures to improve governance in credit granting. The risk management function has been separated as an independent central unit with higher staffing, the central and decentralised credit organisation has been strengthened and a number of procedures and systems are being tightened.
During the year the Group saw a substantial influx of new retail and corporate clients, the majority of whom concern DiBa Bank. Growth in the client portfolio is satisfactory in an otherwise competitive market and the portfolio of retail and corporate clients provides scope for growth in business volume.
Based on the Group’s good liquidity and high solvency, a capital policy has been adopted that better supports the Group’s growth strategy and at the same time takes into account Sydbank’s status as a SIFI as well as forthcoming regulations. The targets for the years ahead are a common equity Tier 1 capital ratio of 12% compared with 13.4% now as well as a solvency ratio of around 15% compared with 15.7% now.
As from 2014 a new dividend policy will contribute to creating long-term shareholder value. The objective is to distribute 30-50% of the year’s profit after tax while taking into account growth plans and capital policy. Distribution will be effected via dividends and/or via share buybacks.
For 2014 the Group expects higher earnings as a result of lower impairment charges for loans and advances, a rise in core income, an increase in trading income and synergies from DiBa Bank.
