Sale speculation as Danske makes North a standalone operation
Danske Bank's Northern Ireland operations will become a standalone business unit instead of part of the Danish giant's personal banking and business banking.
The move takes effect from January and Danske Bank Northern Ireland will be disclosed in financial statements as a separate business unit. Danske announced in late 2013 that it was shutting the bulk of its banking operations in the Republic. Danske's Northern Ireland wing recorded a pre-tax profit for the first six months of the year of £65m, a big improvement on last year.
"The first half of the year has been a particularly strong one for Business Banking. We have already provided more new lending to business customers in 2015 than we did in the whole of 2014," said Danske UK chief executive Gerry Mallon.
"This is down to an encouraging increase in demand for lending from our existing customers after a long spell of relatively subdued demand and the continued acquisition of new to bank customers." Danske said it would be introducing a new operating model for the North.
"Our activities in Northern Ireland will operate as a standalone business unit rather than as part of Personal Banking and Business Banking," Danske said. "We have made a business review that concluded that synergies between the Northern Irish market and the Nordic markets are limited, and we are confident that the change will better enable us to create value for our customers in Northern Ireland, to develop our market position and to improve profitability."
The move sparked speculation that the Northern Ireland operations were being primed for sale. "They are making the bank in Northern Ireland ready to be sold and it makes good sense," analyst Christian Hede from Nordea Markets said.
In response, A Danske spokesman said: "We are happy with our activities in Northern Ireland and have no plans to sell."