COST-SAVINGS PLANNED AT DANSKE BANK AS INSURANCE EARNINGS DISAPPOINT

Denmark-based financial services group Danske Bank said this morning that it would be launching a three-year cost-savings programme that would reduce its costs by about 10%, equal to DKK2bn($369m). This would include a reduction of 2,000 staff. The news came as Danske Bank Group posted a pre-tax gain of DKK3.6bn for the first nine months of 2011, generating a net gain of DKK1.5bn. Total income was DKK31.5bn, down 11% year on year. The insurance division was required to post a loss of DKK400m, down from a gain of DKK1.5bn in the same period last year, because it had to postpone booking the risk allowance to income, and had to strengthen technical provisions because of adverse developments in the credit bond and equity markets". Danske Bank observed that it will be able to reverse the booking of the risk allowances "if it realizes results for each of the interest rate groups that are sufficiently positive".