31st January, 2007
The Bank reported a profit of £73 million before one-offs and the costs associated with the £100 million migration to Danske Bank’s banking platform. This profit is in line with expectations.
Key statistics
- Income of £209m driven by solid performances in both lending and deposits
- Total lending increased by 20%
- Deposit growth increased by 19%
- Operating expenses increased to £132m partly as a result of higher integration and marketing expenses
- Credit losses of £4m reflect the high credit quality of the loan portfolio
- An overall net profit before tax of (-) £9 million is due to the writedown of Good-will associated with the purchase of Northern and also profits being invested back into the business in order to introduce Danske’s leading edge technology platform.
2006 was a year of significant change and development for Northern Bank. The migration programme was completed on schedule over the Easter weekend in April, involving the transference of data from 250 legacy systems operated by the bank’s previous owners National Australia Bank to Danske’s single platform.
Customers have access to Danske Bank’s internet banking proposition which is widely acknowledged to be one of the most advanced in the world. One feature which has proved popular has been the bank’s ability to email or text customers to alert them to significant deposits or withdrawals.
The introduction of new product packages for both business and personal customers after migration generated solid sales, which exceeded expectations. New customers accounted for around 30% of sales.
The new management structure aligned to the Danske model is beginning to have a significant impact, with most decision making devolved to local level. This ensures that the bank does what is right for its local markets, customers and staff.
Commenting on the results, Northern Bank’s Chief Executive Don Price said, “This has been a landmark year for Northern. We now have a comprehensive product range, improved facilities and modern systems, and we are well equipped to meet the needs of our customers."
“Going forward in 2007 Northern’s plans are ambitious, with a clear growth strategy based on securing the benefits of the transformation of Northern since the acquisition by Danske Bank.”
Ends