Danske Bank A/S

Claus Jensen - Head of Investor Relations Thomas Fredrick Borgen - Chief Executive Officer Henrik Ramlau-Hansen - Chief Financial Officer

Jan Wolter - Credit Suisse Securities Europe Anton Kryachok - UBS Christoffer Rosquist - Barclays Capital Securities Daniel Do-Thoi - J.P. Morgan Cazenove Jakob Brink - ABG Sundal Collier Norge Omar Keenan - Deutsche Bank Johan Ekblom - Bank of America Merrill Lynch International Matthew Clark - Nomura International Jacob Kruse - Autonomous Research Riccardo Rovere - Mediobanca Banca di Credito Finanziario Masih Yazdi - Skandinaviska Enskilda Banken Andreas Håkansson - Exane BNP Paribas

At this time, I would like to turn the conference over to Thomas Borgen, CEO. Please go ahead, sir.

Thank you, operator, and thank you all for taking time to listen to this call today. Together with me today I have our CFO, Henrik Ramlau-Hansen; and the Head of IR, Claus Ingar Jensen with me.

Since we have almost finished the deleveraging of our Irish exposure, I do not expect the financial results from non-core activities to have any effect on the P&L. I will make no specific comments about this in my presentation.

However, the non-core information is available in the appendix. Afterwards, feel free to contact our IR Department if you have any more questions.

Since we have almost finished the deleveraging of our Irish exposure, I do not expect the financial results from non-core activities to have any effect on the P&L. I will make no specific comments about this in my presentation.

However, the non-core information is available in the appendix. Afterwards, feel free to contact our IR Department if you have any more questions.

Our financial performance, which exceeded our expectations, was driven by gains in almost all income lines and substantially lower impairment charges. The improvement in earnings reflects strengthening relationship with our customers and a further inflow of new customers, as well as our innovative new business solutions.

Our return on equity came in at 12.5% for the first half. This is a large improvement from the year before when it was at 7.6% excluding the income from the sale of Nets.

Net profit for the period was DKK9.4 billion, and this is 36% higher than the same period last year. Total income rose 6% to more than DKK23 billion with a strong rise in fee income, in particular because of stronger customer activity.

NII was stable despite severe pressure from the negative interest rate environment. Expenses were down 2% as a result of our continued focus on cost efficiency and despite an increase in customer activity.

The cost income ratio now comes in at 46.4% and more than 4% better than the year before. Loan impairment charges in our core activities declined a full 78% from the level the year before.

The trend was owed to steady improvements in credit quality in Denmark in particular on the strength of low interest rates. Our capital base remained strong with a common equity Tier 1 ratio of 14.3%, and a total capital ratio of 18.7% at the end of June.

The share buyback program of DKK5 billion we initiated at the end of March is proceeding according to plan. By the end of the period, we have bought back more than 9.7 million shares with a gross value of DKK1.9 billion.

And, finally, we have revised our guidance for 2015. We now expect a net profit above DKK16 billion owing mainly to the positive development in income and impairments.

This is an increase from our earlier guidance of a net profit above DKK14 billion. Slide 4, please.

Let me now take you through our income statement item by item. NII came in at DKK10.8 billion, which was almost the same as in the year before.

We saw positive effects from higher lending volume, higher bond portfolio income, and lower funding costs. All of the item was adversely affected by pressure on deposit margins.

Net fee income rose 18% as we benefited from increased customer activity, mortgage refinancing and positive developments at Danske Capital. Net trading income was up 2% to DKK4.2 billion.

This is despite the fact that in the first half of 2014, the item including a one-off gain of DKK1 billion from the sale of Nets. Trading income in the first quarter was extra ordinary high and that declined somewhat in the second quarter.

And, finally, we have revised our guidance for 2015. We now expect a net profit above DKK16 billion owing mainly to the positive development in income and impairments.

This is an increase from our earlier guidance of a net profit above DKK14 billion. Slide 4, please.

Let me now take you through our income statement item by item. NII came in at DKK10.8 billion, which was almost the same as in the year before.

We saw positive effects from higher lending volume, higher bond portfolio income, and lower funding costs. All of the item was adversely affected by pressure on deposit margins.

Net fee income rose 18% as we benefited from increased customer activity, mortgage refinancing and positive developments at Danske Capital. Net trading income was up 2% to DKK4.2 billion.

This is despite the fact that in the first half of 2014, the item including a one-off gain of DKK1 billion from the sale of Nets. Trading income in the first quarter was extra ordinary high and that declined somewhat in the second quarter.

Operating expenses were down 2% to DKK10.8 billion and as said, the cost/income ratio improved more than 4 percentage points, now standing just above 46 percentage points. Slide 5, please.

All three banking units made good progress in comparison with the performance in the same period last year. We saw increased customer activity at all units with good gains in most income lines, while we will also aim to reduce expenses while maintaining our focus on cost efficiency measures.

The pressure on NII is especially important issue for Personal Banking, where the floor risk is the most severe. All three business units benefited from the mitigating actions we introduced in the first quarter and from better credit quality as impairment charges fell sharply.

Personal Banking delivered a strong result on the basis of increased customer activity with pre-tax ROE rising 6.1 percentage points, now at 20.6%. There were improvements in most areas.

The NII was 12% lower owing to heavy pressure on deposit margins and that was in Denmark in particular. Fee income and trade income was up 25% and 31% respectively as the very low interest rate led to increased demand for investment solutions and high mortgage refinancing activity.

Expenses were down slightly, and impairments continue to decline, falling 32% below the level the year before. We saw in Personal Banking strong inflow of new business from the beginning of the year and lending rose 24% over the level the year before.

In Sweden, the new management team is now in place and working to strengthen our business position. At Business Banking, we saw strong momentum across all markets.

There was a good increase in activity in Sweden and Norway, where lending volumes grew 12% and 21% respectively. In Denmark, Business Banking more than compensated for the effect of negative interest rates with lending growth and a reversal of impairments and the mitigating actions we took in the first quarter.

Pre-tax ROE rose 8 percentage points now at 21.1%. So, the NII improved as increased business volumes compensated.

Fee income was up 12% and basically due to high customer activity. And impairments declined significantly, and we saw net reversal of around DKK100 million as a result of our ongoing efforts to improve credit quality.

At C&I, profit rose 58%, while ROE was up 6 percentage points, now at 16.7%. We saw significantly high client activity during volatile financial markets.

FICC had a very busy half year, owing to developments in the fixed income and FX market and its income rose 44%. Our Capital Markets business also benefited from strong client activity with income up 13%.

Within General Banking, income rose as a result of increased lending volume, where deposit margins were affected by the low interest rates. So in sum, C&I total income benefited from good underlying growth in all income lines.

Expenses were down slightly despite significantly high activity. And impairments, which normally fluctuates between quarters, had almost no effect on the result as we saw net reversals in the second quarter.

At Danica, net income rose 20%, owing to high investment returns, as conditions in the financial markets improved. The investment results in turn enabled us to book the risk allowance to income for all four interest groups.

The underlying result from insurance business was 1% with premiums up 8%. Slide 7, please.

If you look at expenses in the first half of the year, operating expenses fell 2% now at DKK10.8 billion. We achieved this lower cost level even though higher activity at the business units during the period entailed higher costs.

We are committed to maintaining a strong focus on expenses and we expect to continue our cost initiatives during the rest of the year, with the aim of reducing nominal expenses to less than DKK22 billion for the full year. Slide 8, please.

As we continue to see an improvement in credit quality, loan impairment charges continue to fall, making a significant contribution to the first half results. The charges for core activities came in at DKK300 million, dropping as much as 78% from the level the year before.

Impairment in the first half of the year were lower in all business units, most sharply at Business Banking. We had net reversals of DKK100 million.

In the non-core activities, we had net reversals of the same amount. Total charges for the group amounted to around DKK150 million.

The loan loss ratio, including non-core activities, declined down from 17 basis points to 2 basis points and from 14 basis points to 3 basis points on our core activities. Slide 9, please.

The trend towards lower impairment charges is not new. In the last four quarters, we have seen a drop in both new and increased targets.

Since the last quarter of 2014, we have also seen net reversals of individual charges. The notable development in Business Banking are primarily related to Denmark and commercial property in particular.

Within Personal Banking, we see higher collective values as house prices have increased in Copenhagen and other major cities in Denmark and underpinned by the very low interest rate environments. As we consider the improving trend in our customer financial positions as sustainable over the coming quarters, we have revised our impairment charges for 2015 to be significantly lower than in 2014.

Slide 10, please. Our capital position improved in the second quarter.

At the end of the quarter, we had a common equity Tier 1 capital ratio of 14.3% and a total capital ratio of 18.7%. The increase in the capital ratio was due to our earnings during the quarter, whereas there was no material effect from the risk exposure amount in the period.

At the beginning of the period, however, the capital ratio declined by 0.1% as a result of an accounting change at Danica. The risk exposure amount was affected by a decline in credit risk at the sale of the SME portfolio and non-core more than offset to rise in new lending.

During the quarter, we implemented new models for market risk and counterparty credit risk and this led to a small decline. Although, the very higher volatility of loan yields has a larger contrary effect in the second quarter.

In the remainder of the year, we expect to see further decline from continuing capital optimization, whereas the combined effect of outstanding regulatory issues will obtain a modest rise. We expect REA to grow in the second half of the year.

However, in total, we estimate that the total REA will be around Q1 level at year-end. Slide 11, please.

Danske Bank has a good franchise in Northern Ireland. The financial results have improved in the past couple of years and we expect their performance to continue on a positive track.

As part of our ongoing business review, we are considerate how we can further strengthen our operations in this market. One important conclusion from review is that with the limited operational synergies and customer interactions between the activities in Northern Ireland and those in the Nordic markets.

We have, therefore, decided beginning in January that Danske Bank Northern Ireland will function as a separate business unit and its financial results will be presented separately. Operating Northern Ireland on a stand-alone basis will strengthen our organization as a Nordic universal bank, and we are confident that it will enable local management in Northern Ireland to better execute their strategy and launch local initiatives that will benefit their customers.

At the same time, the operation will continue to benefit from cost efficiencies within the group. Slide 12, please.

And finally, before taking your questions, let me turn to our guidance for the full year. We are revising our guidance for the net profit for 2015 from about DKK14 billion to about DKK16 billion.

The stronger outlook is owed mainly to the positive development in income and impairments. We have seen solid customer activity across our business units and macroeconomic conditions continue to improve.

We expect total income to increase from the level in 2014, benefiting from high net trading income in the first quarter and lower funding cost. Negative Central Bank interest rates are putting pressure on the NII, however - and development in the financial markets posts risks for trading and insurance income.

We expect expenses to be below DKK22 billion. Impairment charges for our core activities are expected to decline to a level significantly lower than in 2014.

At our non-core activities, we expect a pre-tax result at around DKK0 million.

At Danica, net income rose 20%, owing to high investment returns, as conditions in the financial markets improved. The investment results in turn enabled us to book the risk allowance to income for all four interest groups.

The underlying result from insurance business was 1% with premiums up 8%. Slide 7, please.

If you look at expenses in the first half of the year, operating expenses fell 2% now at DKK10.8 billion. We achieved this lower cost level even though higher activity at the business units during the period entailed higher costs.

We are committed to maintaining a strong focus on expenses and we expect to continue our cost initiatives during the rest of the year, with the aim of reducing nominal expenses to less than DKK22 billion for the full year. Slide 8, please.

As we continue to see an improvement in credit quality, loan impairment charges continue to fall, making a significant contribution to the first half results. The charges for core activities came in at DKK300 million, dropping as much as 78% from the level the year before.

Impairment in the first half of the year were lower in all business units, most sharply at Business Banking. We had net reversals of DKK100 million.

In the non-core activities, we had net reversals of the same amount. Total charges for the group amounted to around DKK150 million.

The loan loss ratio, including non-core activities, declined down from 17 basis points to 2 basis points and from 14 basis points to 3 basis points on our core activities. Slide 9, please.

The trend towards lower impairment charges is not new. In the last four quarters, we have seen a drop in both new and increased targets.

Since the last quarter of 2014, we have also seen net reversals of individual charges. The notable development in Business Banking are primarily related to Denmark and commercial property in particular.

Within Personal Banking, we see higher collective values as house prices have increased in Copenhagen and other major cities in Denmark and underpinned by the very low interest rate environments. As we consider the improving trend in our customer financial positions as sustainable over the coming quarters, we have revised our impairment charges for 2015 to be significantly lower than in 2014.

Slide 10, please. Our capital position improved in the second quarter.

At the end of the quarter, we had a common equity Tier 1 capital ratio of 14.3% and a total capital ratio of 18.7%. The increase in the capital ratio was due to our earnings during the quarter, whereas there was no material effect from the risk exposure amount in the period.

At the beginning of the period, however, the capital ratio declined by 0.1% as a result of an accounting change at Danica. The risk exposure amount was affected by a decline in credit risk at the sale of the SME portfolio and non-core more than offset to rise in new lending.

During the quarter, we implemented new models for market risk and counterparty credit risk and this led to a small decline. Although, the very higher volatility of loan yields has a larger contrary effect in the second quarter.

In the remainder of the year, we expect to see further decline from continuing capital optimization, whereas the combined effect of outstanding regulatory issues will obtain a modest rise. We expect REA to grow in the second half of the year.

However, in total, we estimate that the total REA will be around Q1 level at year-end. Slide 11, please.

Danske Bank has a good franchise in Northern Ireland. The financial results have improved in the past couple of years and we expect their performance to continue on a positive track.

As part of our ongoing business review, we are considerate how we can further strengthen our operations in this market. One important conclusion from review is that with the limited operational synergies and customer interactions between the activities in Northern Ireland and those in the Nordic markets.

We have, therefore, decided beginning in January that Danske Bank Northern Ireland will function as a separate business unit and its financial results will be presented separately. Operating Northern Ireland on a stand-alone basis will strengthen our organization as a Nordic universal bank, and we are confident that it will enable local management in Northern Ireland to better execute their strategy and launch local initiatives that will benefit their customers.

At the same time, the operation will continue to benefit from cost efficiencies within the group. Slide 12, please.

And finally, before taking your questions, let me turn to our guidance for the full year. We are revising our guidance for the net profit for 2015 from about DKK14 billion to about DKK16 billion.

The stronger outlook is owed mainly to the positive development in income and impairments. We have seen solid customer activity across our business units and macroeconomic conditions continue to improve.

We expect total income to increase from the level in 2014, benefiting from high net trading income in the first quarter and lower funding cost. Negative Central Bank interest rates are putting pressure on the NII, however - and development in the financial markets posts risks for trading and insurance income.

We expect expenses to be below DKK22 billion. Impairment charges for our core activities are expected to decline to a level significantly lower than in 2014.

At our non-core activities, we expect a pre-tax result at around DKK0 million.

The second one is, if we look at the risk weights in the Finnish corporate book, where Danske Bank got an approval now for Foundation-IRB, what are the risk weights post the approval? And is the approval a joint decision between the Danish and Finnish FSA?

Or what does that process look like? Thank you.

The second one is, if we look at the risk weights in the Finnish corporate book, where Danske Bank got an approval now for Foundation-IRB, what are the risk weights post the approval? And is the approval a joint decision between the Danish and Finnish FSA?

Or what does that process look like? Thank you.

Okay. I will take the first question and Henrik will take the two last questions.

From the 1st of January in 2016, we will split out all the activities from Personal and Business into the Northern Ireland operation. So from that point of view, you will have a separate accounting line.

But more importantly, operationally, it will also be separated, even though they will benefit from, of course, being on our technological platform and benefiting from our back-office operations.

Thank you. And that includes both the Personal and the Business Banking activities then?

All is separated out from Danske?

All would be separated out on the 1st of Jan next year.

In terms of the approval of the FIRB in Finland, that has been come through together between the Danish FSA and the Finnish FSA. And a rough estimate that will be implemented by the end of Q3 is DKK10 billion to DKK15 billion lower risk weights.

Okay. Many thanks for the clarifications.

Hi. Good afternoon and thank you for taking my questions.

Just two questions, please. Firstly, on NII.

In the past, you have outlined a number of measures which you have undertaken to offset the pressure from negative Central Bank rates in Denmark. I just wanted to confirm what proportion of those measures have come through in Q2, and whether we should expect any more tailwinds to come from your management action on NII in Q3 and Q4?

And secondly, just to follow up on the REA point, please. I think previously, when you were outlining your targets for 2018, you might have talked about broadly flat REAs in the forecast period at sort of Q4 2014 level.

So given your new guidance on REAs for this year, shall we expect that REAs can come down from 2015 level in 2016 and 2017 so that you end up broadly flat in terms of REA by the end of 2018 versus 2014 start? Thank you.

Okay. Claus will take your NII question and Henrik will try to expand on the risk-weighted assets question.

Thank you.

Okay. And then you had a question regarding the development of our risk-weighted assets towards 2018.

Yes, please.

Okay. Understood.

Thank you very much.

Claus will like then to answer your question on NII.

At the same time, as we also have alluded to over a number of quarters, the recent uptick in the economy in Denmark have not yet affected appetite for personal lending to any larger extent. And then, we also - on top of that, we do have to admit that there is still some pressure on lending margins across all our business.

And that goes also for Personal Banking. And then, there is the third explanation, which is rather technical explanation.

It is that we saw a positive - rather positive impact in Q1 on lending margins. So that there is a sort of lagging effect from the interest rate movements we saw in the first quarter and then into the second quarter on our accounts.

At the same time, as we also have alluded to over a number of quarters, the recent uptick in the economy in Denmark have not yet affected appetite for personal lending to any larger extent. And then, we also - on top of that, we do have to admit that there is still some pressure on lending margins across all our business.

And that goes also for Personal Banking. And then, there is the third explanation, which is rather technical explanation.

It is that we saw a positive - rather positive impact in Q1 on lending margins. So that there is a sort of lagging effect from the interest rate movements we saw in the first quarter and then into the second quarter on our accounts.

Thank you. Can I just ask, with regards to the mix shift that you mentioned initially, where do we stand today in terms of the split of the Personal Banking book between what you call traditional banking loans versus mortgages?

And where have we come from, at sort of a peak where lending margins were higher, or your blended margins were higher?

Okay. Thank you very much.

And then secondly, and more specifically, on C&I, I appreciate that market activity and revenue at C&I have been considerably higher than what you were expecting when you set your targets at the end of last year. But the H1 run rate on costs still, at least from what I can tell, gets you to above the - at the upper end, or even above the upper end, of the DKK4 billion to DKK4.5 billion target range that you set in Q3.

Are the cost savings here more backend loaded in nature? Or should we expect those savings not to come through as - given that market activity is higher than you were expecting?

Thank you.

And secondly, some of the costs are back-ended and some of the downsizing on the costs will not be seen before the third and fourth quarter. So the run rate into 2016 will be lower and within the range we have guided.

Again, due to that very high activity, which we have said several times or at least the last two quarters you alluded to, has done some of these adjustments by selection have been postponed somewhat. Henrik would like to answer your question when it comes to the overall costs.

Okay. Great.

Thanks very much.

Yeah. Thank you.

Sorry for getting back to the cost line, but, Thomas, did you just say that the run rate at the end of the year would be lower; and also that, due to activity, you have more staff now than you probably need going forward? Because then, I guess, you will actually see somewhat lower underlying cost in the fourth quarter.

And then the previous question, I guess, is quite right, that you do end up quite a lot below DKK22 billion. Or maybe I misunderstood it.

Okay.

I think Henrik would like to take you through both RWA and the NII question.

I think Henrik would like to take you through both RWA and the NII question.

I think Henrik would like to take you through both RWA and the NII question.

There has also been a shift in the volume, especially in the Personal Banking in Denmark during the quarter.

Okay. Okay.

Thanks a lot.

And then, my second question was just on asset quality. Do you have kind of a rough sensitivity to have a 5% increase in house prices and rents in Denmark and what that means in terms of provision releases?

Just so that we have a rough idea going forward, if the sort of macro picture continued to be positive in Denmark and then what that could potentially mean for releases next year? Thank you.

And then, my second question was just on asset quality. Do you have kind of a rough sensitivity to have a 5% increase in house prices and rents in Denmark and what that means in terms of provision releases?

Just so that we have a rough idea going forward, if the sort of macro picture continued to be positive in Denmark and then what that could potentially mean for releases next year? Thank you.

Thank you. I think most things have been covered, but if we can just focus for a minute on the fee income which has been phenomenally strong really across all business units.

Last quarter, you spoke about some DKK200 million of incremental fees from the very high remortgaging activity. Can you give us an update on where we were in the second quarter?

And if we now have less favorable 30 year rate, what kind of headwind do you see in the second half on the fee income line?

And given the current level of interest rates, we expect the activity in the second half to be much lower in the mortgage area.

Understood. Thank you.

And then finally, just on loan loss charge, what would you say was the underlying loan loss charge with the - for the second quarter if you strip out the kind of discretionary reserve release that you chose to make? Thank you.

And then finally, just on loan loss charge, what would you say was the underlying loan loss charge with the - for the second quarter if you strip out the kind of discretionary reserve release that you chose to make? Thank you.

And then finally, just on loan loss charge, what would you say was the underlying loan loss charge with the - for the second quarter if you strip out the kind of discretionary reserve release that you chose to make? Thank you.

Thanks.

Okay. And then, you asked about the NII.

There is no question that we have been pressured on the deposit side. That pressure has been abating and we see no particular pressure taking place for the rest of the year on deposit by itself as most of that has been priced through.

We are still looking at continued mitigating actions, but that will be of minor effect as we will continue to try to protect our private customers of not introducing negative rates. On the lending side, we can see that there is some pressure building up more from that our customers, as Claus alluded to, going from traditional banking products into mortgage products.

We expect that to continue for another period, but maybe at the lower pace.

Within C&I, there has been a reprising taking place during 2013 and 2014 and there we expect pretty much flattish margins going forward. And then you base back to the lending growth.

And we expect the lending growth to be healthy going forward, particularly in [ph] some of our foreign (51:30) units, which the number will turn out depending on the lending growth and the average volume, which we put on the box. The lending in Norway will come through as very profitable.

And you should be cautious, again, to look at quarter-by-quarter. But, of course, the underlying growth is profitable for us and then, of course, profitable for the shareholders.

Within C&I, there has been a reprising taking place during 2013 and 2014 and there we expect pretty much flattish margins going forward. And then you base back to the lending growth.

And we expect the lending growth to be healthy going forward, particularly in [ph] some of our foreign (51:30) units, which the number will turn out depending on the lending growth and the average volume, which we put on the box. The lending in Norway will come through as very profitable.

And you should be cautious, again, to look at quarter-by-quarter. But, of course, the underlying growth is profitable for us and then, of course, profitable for the shareholders.

Hi. Thank you.

Two questions. Firstly, just on net interest income and the mitigation, I just wanted to ask is all the mitigation that you have done, the DKK700 million you talked about in Q1, is that going through the NII line?

Or does some of that also end up in your commission line as higher fees on products, etcetera?

Yeah. When it comes to the DKK700 million and the calculations we did when we discussed that in one of our prior conference calls that is especially an NII issue.

But then, we have said that we will - that part of our mitigating actions will also involve other types of income as a good example of our diversified business model. So there is effects coming in also on the fee line from what we had been initiated.

Okay. Thank you.

And just how much of the mitigation effects have we seen in the fee revenues now? How much has that added incrementally in Q2?

Okay. Thank you.

Yeah. When it comes to the impairment development, Riccardo, I can only say that if you have a look at some of the main slides in our presentation, you will see that this is not something that just happened in the second quarter.

We have had a long process of lower, new and increased impairments, and we have had reversals during quite many quarters. Secondly, you should also be aware that a decent part of the reversals we have made in the second quarter are coming from C&I and in C&I, the nature behind reversals will always be quite volatile.

Okay.

And then [indiscernible]

Thanks.

Henrik?

Okay. Thanks.

Very clear. Thanks.

The other question is how will we potentially use that excess capital between distributing back to shareholders or growth? We feel it is very right to do profitable growth in those markets we are concentrating on.

How much that growth will portray into risk-weighted assets, we will need to see at the year end. But it is highly likely and you can just use 2014 and 2015 as example for that, that there will be probably excess capital which need to be distributed back to the shareholders in one way or another in addition to the dividend.

And that we will need to return to you when we see how it looks like at the end of the year.

Okay. Thank you very much.

Okay. The last question, please?

Of course, I think your last question was out of the line in the sense that we have said that we have a capital target of 30% minimum and we have said that the capital target for 2015 will be at 40% and we will constantly review that target as we move along. And of course, we will always adjust and move towards the [ph] fullest extent which will be taken in as we move towards 2018.

If or when the rules changes, we will also adjust. But as you probably know more, I hope you know more, is that the Swedes use Pillar 2 to much larger extent than we do.

So, we are very comfortable with the present capital position of the bank and we run it very diligently. Your first question, Claus would like to answer.

Yeah. When it comes to the allocation of different loans in Realkredit Denmark, we have, over the last couple of quarters seen a strong trend towards fixed rate loans with installments.

I think this is an answer or a natural choice from our customers since interest rate loans in Denmark had been historically low during that period. And then the other explanation is also that we have done a lot to intensify our customers to move away from interest-only loans and into installment loans.

Yeah. There is a difference in the margins and if you look at fixed rate loans, then you will pay around 68 basis points in margins.

And if you look at interest-only loans fixed rate, you would pay around 101 basis points in margin. Yeah.

Margins in Sweden have been marginally up during the quarter and then we have seen a small increase in volume.

Okay. Thank you.

That is a very small increase.

Yeah.

Okay. And that was the last question.

So, thank you all for your interest at Danske and for your questions. As always, you are all welcome to contact our IR departments if you have any more questions when you have time to look into the financial results in detail.

A transcript of this conference call will be added to our website within the next few days.