Danske Bank announced second quarter pre-tax profits 17% ahead of consensus expectations on Wednesday, with commissions, costs and loan loss provisioning driving the results while net interest income (NII) held up.
Standard & Poor’s upgraded Iceland’s main banks into investment grade territory on Tuesday, saying it expectations operating conditions for Icelandic banks to improve on the back of measures proposed by the government to enable the eventual lifting of the country’s capital controls.
A German-heavy wave of euro covered bond supply continued this week as nine benchmarks hit the market, with deals from across jurisdictions finding demand even at low yields and longer tenors, but syndicate officials expect activity to slow next week as summer kicks in.
Systemic risks in Sweden’s mortgage market are increasing, Fitch said on Wednesday, adding that any disruptions could hit the wider banking sector, although it noted that banks are mitigating the risks while households have good debt servicing capabilities and rated banks are strongly capitalised.
A move by the Finnish FSA (Finanssivalvonta) to designate Nordea Bank Finland, OP Financial Group, Danske Bank and Municipality Finance as systemically important credit institutions, and therefore impose upon them additional capital requirements, is credit positive for the affected banks, according to Moody’s.
Nykredit Realkredit has confirmed it is targeting some Eu3bn (Dkr22bn) of bond issuance eligible for bail-in buffers over the next two years to bolster its capital after Standard & Poor’s downgraded it from A+ to A on Monday and left the rating on negative outlook.
Skandinaviska Enskilda Banken (SEB) kicked off Swedish banks’ Q2 results announcements on Tuesday with pre-tax profits of Skr5.3bn (Eu570m) that were 14% ahead of consensus expectations, with strong commission revenues offsetting a fall in net interest income.
The euro covered bond market comfortably absorbed seven new euro benchmarks this week, with senior unsecured issuance following, as the market reopened after a positive outcome finally emerged from Greek negotiations on Monday morning.