Danske Bank has opted to reduce its shipping portfolio even further in the first half of the year, according to the bank's second quarter interim report, published Thursday.
This means that the bank's shipping exposure has gone down from USD 6.55 billion on December 31 2013 to USD 6.23 billion on June 30 of this year. Last year Danske Bank informed that the bank, unlike in the past, no longer needed to put aside large sums for shipping impairments as the segment had improved, though the bank was still looking to reduce its portfolio.
Danske Bank has also stated this year that the bank is ready to invest in new, good shipping projects, though it plans to focus primarily on existing customers. The bank will continue this strategy, confirms Danske Bank's Head of Shipping Øivind Haraldsen in relation to the interim report on Thursday. The bank declines to comment further on its shipping portfolio.
Even though the bank is ready for new investments the market has been disappointing, Øivind Haraldsen told ShippingWatch after the first quarter.
"We also expected things to look better, but I think there were too many orders, and this has ruined some of the improvements we expected. We're still positive toward dry bulk and LPG, while we're slightly less positive about major tank. The first quarter was disappointing and the second quarter probably won't be too good either. But we're optimistic about the long-term. There's been a high ordering activity, which has taken some of the breath away from the market," said Øivind Haraldsen.
Danske Bank's second quarter interim report shows a result before taxes of USD 903.2 million, compared to USD 483.5 million in the second quarter 2013. The bank's net result also improved, to USD 731 million, compared to USD 394.5 million in the same period last year. Danske Bank's impairments came to USD 113 million.
"We saw good progress in the first half of 2014. We increased net profit 88 percent from the level in the first half of 2013, and we are moving steadily in the right direction. Expenses are declining as expected, the positive trend in impairments is continuing, and we saw growing customer activity in the second quarter of 2014," says CEO Thomas F. Borgen in a statement on the interim report.
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