IFRS Financial
Statements
Notes to the Financial
Statements
Proposal of
Distribution of Profits
Content
Board of Directors’ report
The Auditors’ note
Accounting material
Other Notes
with 36.4 million euros. Customers were paying back their
housing loans with EUR 933.0 million. Considering the loan port-
folio in Danske Bank A/S, Finland Branch, the Bank has access
to enough loans for a new issuance. Hedging and short-term
funding were executed normally throughDanske Bank A/S. The
amount of cover pool eligible loans in the Danske Bank Group’s
Finnish operations has been stable withpositive momentum due
to positive market share and balance development.
housing companies continued to decline, falling by 2% year-on-
year in October 2025.
The Bank’s other investment securities portfolio consists of li-
quidity coverage ratio (LCR) eligible bonds. Other investment se-
curities amounted to EUR 68,6 million at the end of 2025 (46.0
million).
Board of Directors’
Report 2025
Financial review
The comparison figures in parentheses refer to 2024 figures.
The funding and liquidity situation was good. All short-term fund-
ing was received from the Group. The Bank’s liquidity buffer was
EUR 167.0 million at the end of 2025 (93.6 million) and it con-
sisted of deposits in the central bank and central bank eligible
high quality liquid bonds.
The Bank’s profit before taxes was EUR 28.3 million (37.0 million).
The result was EUR 22.7 million (29.6 million).
Danske Mortgage Bank Plc in brief
Danske Mortgage Bank Plc is a wholly-owned subsidiary of
Danske Bank A/S, the parent company of Danske Bank Group.
The Group is headquartered in Copenhagen and Danske Bank’s
share is quoted on the Nasdaq OMX Copenhagen.
Throughout this Annual Report the term “Bank” refers to Danske
Mortgage Bank Plc. The Danske Bank Group is referred to as
“Group”.
Return on equity amounted to 6.5 per cent for 2025 (8.0 per
cent). Return on equity has decreased mainly due to lower inter-
est rate level driving down the net interest income. The Bank dis-
tributed profits by EUR 59.6 million in 2025 in total including EUR
30 million extraordinary dividends. The extraordinary dividends re-
lated to accumulated net profit during covid-19 pandemic, which
have not been previously paid out.
With a liquidity coverage ratio (LCR) of 1,129 per cent end of
2025 (433 per cent), the Bank was compliant with the regulatory
minimum requirement of 100 per cent at the end of reporting
period. According to the Capital Requirements Regulation (EU)
No 575/2013 banks must have a LCR of at least 100 per cent.
Danske Mortgage Bank Plc is domiciled in Helsinki and its busi-
ness identity code is 2825892-7.
Danske Mortgage Bank Plc is operating as an issuer of covered
bonds. Bonds issued by the Bank are covered by a pool of loans
consisting of Finnish household mortgages. The Bank does
not act as the originator of housing loans as it purchases loans
from Danske Bank A/S, Finland Branch. The purchased loans are
long term loans for Finnish households having a residential real
estate or shares of a housing company as collateral. Loan ser-
vicing process as many other processes are outsourced to
Danske Bank A/S. This way loan purchases are not having an ef-
fect on the service received by the customers.
Operating environment
Net Stable Funding Ratio (NSFR) presents the ratio of available
stable funding to required stable funding. The Bank’s NSFR was
116 per cent end of December 2025 (118 per cent) which com-
plies with the 100 per cent requirement. Available stable funding
totalled to EUR 5,284.8 million end of December 2025 (5,106.0
million), which is EUR 737.9 million (795.3 million) above the re-
quired stable funding. Intra group funding totalled to EUR 600.0
million, having average residual maturity of 12 months (18
months).
Finland's economic growth remained sluggish in 2025, similar to
previous years. The unemployment rate reached its highest level
since 2009, although a significant part of the increase was ex-
plained by the labour force participation rate of the working-age
population rising to its highest level in over 30 years. Weak la-
bour market kept consumer confidence low, which was reflected
in an increase in the savings rate and a decline in domestic con-
sumer demand. New orders in the industrial sector and the vol-
ume of exports grew slightly compared to the previous year, de-
spite trade policy uncertainties and the United States' increased
import tariffs. Total investments increased, although invest-
ments in residential construction continued to decline. Finland's
public sector debt level rose more thanexpected, despite spend-
ing cuts.
Total operating income for 2025 amounted to EUR 40.8 million
(50.4 million). The net interest income for the financial year was
EUR 36.3 million (45.9 million) reduced by lower interest rates.
The Bank’s net fee income totalled EUR 2.5 million (2.5 million).
Net trading income was EUR 1.8 million (1.8 million),.
The Bank’s cost to income ratio was 26.0 per cent (22.2 per cent)
and the Bank’s operating expenses totalled EUR 10.6 million
(11.2 million).
Act on Mortgage Credit Banks and Covered Bonds (151/2022)
became effective on 8 July, 2022 repealing the earlier act on
mortgage banking activities. Using transitional rule in the
new act, we have converted the bonds originally issued under
the previous act to fully conform to new act, and our activities
are solely under the new act 151/2022.
In the end of 2025 the Bank’s equity totalled EUR 331.9 million
(368.8 million). During 2025 the Bank paid EUR 59.6 million in
dividends to Danske Bank A/S. The result for 2025 was EUR
22.7 million.
Impairment charges and final write-offs totalled to EUR 1.9 mil-
lion (2.2 million) of which final write-offs were 2.7 million euros
(1.6 million). Despite uncertain economic outlooks, impairment
charges on receivables remain moderate.
Danske Mortgage Bank Plc’s operations continued stable during
2025 in all aspects. The quality of the loan portfolio has re-
mained at good level. The Bank’s profit has decreased com-
pared to previous year as expected driven by lower interest rate
level.
The European Central Bank continued easing monetary policy
and reduced its key interest rates four times from January to
June, from three to two percent. Household mortgage and cor-
porate interest expenses decreased by approximately one per-
centage point during the year, further alleviating the debt servic-
ing burden of mortgage holders and businesses.
Rating categories and corresponding probability of default
ranges can be found in the Risk Management Disclosure, from
page 10. Non-performing loans are sold regularly to Danske
Bank A/S, Finland Branch and final write offs realize from these
loan sales.
In 2025 the Bank issued in total three new covered bonds. In
June a EUR 500 million covered bond was issued with long 4 year
maturity. In November two covered bonds were issued; a short
three-year EUR 500 million and a seven-year EUR 750 million
covered bond. One EUR 1.25 billion bond matured in September.
The Bank bought housing loans with 932.2 million euros and
sold housing loans back to Danske Bank A/S, Finland Branch
Balance sheet and funding
In the housing market, the number of transactions of old apart-
ments and the volume of mortgage drawdowns increased ap-
proaching the average levels preceding the peak years in hous-
ing transactions. On the other hand, the prices of old dwellings in
The Bank´s total balance sheet for 2025 was EUR 5,937.5 million
(5,918.1 million). Loans and receivables from customers
amounted to EUR 5,657.2 million (5,694.8 million).
3
Danske Mortgage Bank Plc / Annual Report 2025
