The BANK of Greenland
CVR no. 80050410
Notification to Nasdaq OMX Copenhagen
08/2024
Interim
Report
First Half of 2024
Interim Report
First Half of 2024
1
Management’s Review 2
Interim Report in headlines 2
Financial Highlights for the first half of 2024 4
Management's Review, first half of 2024 5
Management Statement 10
Income Statement and Statement of Comprehensive
Income 12
Balance Sheet 13
Statement of Changes in Equity 14
Overview of Notes 16
Notes to the Quarterly Report 17
Contents
Interim Report
First Half of 2024
Management’s Review
2
Interim Report in headlines
Fine first half-year for the Bank
The BANK of Greenland's profit before tax amounts to DKK
120.1 million for the first half of 2024, compared to DKK 103.0
million for the first half of 2023. The profit before value adjust-
ments and write downs is satisfactory at DKK 127.5 million,
compared to DKK 98.3 million for the previous year.
Lending has increased by DKK 284 million since the end of
2023, amounting to DKK 5,097 million at the end of the first
half-year. It was expected that the continued favourable eco-
nomic development in Greenland would result in positive, but
more subdued growth in the Bank’s lending in 2024. Guaran-
tees decreased by DKK 41 million from DKK 1,774 million at
the end of 2023 to DKK 1,733 million at the end of the first
half of 2024.
Net interest and fee income increased by DKK 38.4 million to
DKK 242.4 million in the first half of 2024 compared to the
same period in 2023. The increase is primarily due to the
record-high lending volume and the development in the level of
interest rates in 2023 and 2024. Compared to the first half of
2023, total loans and guarantees increased by DKK 361 million
up to the end of the first half of 2024.
Total expenses including depreciation amounted to DKK 117.5
million at the end of the first half of 2024, compared to DKK
108.7 million for the same period in 2023.
The increase concerns staff expenses as a consequence of
collective agreement-based adjustments and continued invest-
ment in more employees, as well as other administration
expenses, where the increase can be attributed primarily to IT
expenses.
At the end of the first half of 2024, value adjustments showed a
capital gain of DKK 3.9 million, compared to a capital gain of
DKK 11.0 million for the same period in 2023. Interest rate
trends resulted in weak positive development in the Bank’s
bond holdings, while the currency area also performed posi-
tively. In terms of value adjustment alone, the Bank's holdings of
sector equities performed negatively, even though sector equi-
ties yielded extraordinarily high dividends in 2024.
Impairments of loans and guarantees amounted to DKK 11.3
million in the first half of 2024, compared to DKK 6.3 million in
the first half of 2023. The Bank sees continued satisfactory
creditworthiness in the loan portfolio. In addition to the Bank’s
individual impairment models, a management supplement of
DKK 44.8 million is allocated. In particular, the supplement
covers the risks associated with increasing inflation and interest
rates, and greater cyclical uncertainty.
In the stock exchange announcement of 24 July 2024, the fore-
cast profit before tax for 2024 was adjusted upwards to a
range of DKK 200-240 million, which remains unchanged.
Management’s Review
The profit before tax gives a return of 17.1 per cent p.a. on opening equity after disbursement of dividend.
An increase in loans totalling over DKK 5 billion.
Deposits increased to DKK 6.6 billion.
Core earnings per krone in costs of 1.93 in the first half of 2024, compared to 1.90 in the first half of 2023.
Write-downs and provisions of 0.2 per cent for the period.
Solvency ratio of 25.9 and a capital requirement of 11.0 per cent.
Interim Report
First Half of 2024
Management’s Review
3
Interim Report
First Half of 2024
Management’s Review
4
Financial Highlights for the first half of 2024
First half-
year
First half-
year
Full year
First half-
year
First half-
year
First half-
year
2024
2023
2023
2022
2021
2020
Net interest and fee income
242,363
203,990
435,012
167,808
168,148
161,110
Value adjustments
3,917
10,992
40,058
-25,195
5,115 -7,330
Other operating income
2,617
3,005
5,803
3,049
2,179
2,221
Staff and administration expenses
110,806
102,828
211,166
92,437
93,229
85,566
Depreciation and impairment of tangible assets
4,316
4,035
8,158
3,636
3,486 3,449
Other operating expenses
2,363
1,866
2,815
1,696
1,602
1,416
Write-downs on loans and receivables, etc.
11,272
6,279
14,160
2,112
2,331
9,845
Profit before tax
120,140
102,979
244,574
45,781
74,794
55,725
Tax
5,285
16,746
52,179
-5,893
7,882 14,754
Profit for the period
114,855
86,233
192,395
51,674
66,912
40,971
Selected balance sheet items:
Lending
5,097,302
4,638,998
4,812,975
4,009,541
3,824,443 3,736,894
Deposits
6,553,883
6,062,029
6,413,469
5,673,324
5,879,878 6,016,314
Equity
1,497,207
1,370,904
1,479,123
1,249,277
1,200,414 1,120,137
Total assets
9,056,827
8,222,783
8,840,981
7,544,633
7,537,865 7,507,427
Contingent liabilities
1,733,133
1,830,345
1,774,426
1,972,396
1,914,893 1,521,275
Key figures:
Capital ratio
25.9
24.0
26.0
22.8
22.7 23.3
Core capital ratio
24.7
22.9
24.9
22.8
22.7 23.3
Return on equity before tax for the period
8.1
7.7
17.5
3.6
6.3 5.1
Return on equity after tax for the period
7.7
6.4
13.8
4.1
5.6 3.7
Income per cost
krone 1.9
1.9
2.0
1.5
1.7 1.6
Rate of return
1.3
1.0
2.2
0.7
0.9 0.5
Interest risk rate
0.6
1.3
0.7
1.4
1.5 1.0
Foreign exchange position
0.4
0.3
0.4
0.3
0.9 0.7
Liquidity coverage ratio
234.4
217.2
259.0
207.9
259.6 183.7
Net stable funding
ratio 129.4
129.6
134.0
-
- -
Lending plus write
-downs as a ratio of deposits 74.6
74.4
72.3
68.9
65.1 63.2
Lending as a ratio of equity
3.4
3.4
3.3
3.2
3.2 3.3
Growth in lending for the period
5.9
6.6
10.6
6.0
-4.5 -0.6
Sum of large
exposures 151.7
166.5
150.0
164.0
163.1 167.6
Write
-down ratio for the period 0.2
0.0
0.2
0.0
0.0 0.2
Accumalated write
-down ratio 3.2
3.0
3.1
3.1
3.2 3.5
Profit per share after tax for the period
66.7
47.9
106.9
28.7
37.2 22.8
Net book value per
share 831.8
761.6
821.7
694.0
666.9 622.3
Stock exchange quotation/net book value per share
0.8
0.8
0.8
0.9
0.9 0.8
Interim Report
First Half of 2024
Management’s Review
5
Management’s Review, first half of 2024
Statement of income
At TDKK 184,019, compared to TDKK 150,522 in the first half
of 2024, net interest income increased by more than 22%. The
rising level of interest rates during 2023, and the high level of
lending, are driving the growth.
The rising level of interest rates in 2023 fell back a little in June
2024, but the level of interest rates in the first half of 2024 was
higher than in the first half of 2023. Lending also increased by
TDKK 458,304 or 9.9% in the period from 30 June 2023 until
30 June 2024.
As expected, the Bank also saw shifts in deposits in favour of
savings and high-interest accounts, thereby reducing the deposit
margin.
Share dividends increased by TDKK 6,704 to TDKK 8,859 as of
30 June 2024. This significant increase is due in particular to
DLR Kredit's payment of dividend for the first time.
Fee and commission income decreased by TDKK 1,889 com-
pared to the same period of 2024. Lower investment activity, a
lower level of guarantees and insurance brokerage commission
affected this item negatively.
Net interest and fee income increased overall by TDKK 38,373
to TDKK 242,363 for the first half of 2024.
Other operating income amounted to TDKK 2,617, which is a
decrease of TDKK 388 from the first half of 2023. The differ-
ence primarily concerns the lower external rental value of the
Bank’s staff home properties.
Staff and administration expenses amounted to TDKK 110,806,
which is an increase of TDKK 7,978 compared to the first half
of 2023. Staff expenses increased by TDKK 5,915 as a result of
staff increases and salary increases under collective agreements.
Administration expenses increased by TDKK 2,063. The in-
crease primarily reflects IT expenses.
Other operating expenses, which concern operation and
maintenance of the Bank’s office buildings, increased by TDKK
497 to TDKK 2,363 in the first half of 2024, compared to the
same period of 2023. The increase is due to timing differences
in the payment of costs.
Depreciation of properties and fixtures and fittings amounted
to TDKK 4,316, compared to TDKK 4,035 for the same period
in 2023.
The profit before value adjustments and write-downs is a satis-
factory TDKK 127,495, compared to TDKK 98,266 in the first
half of 2023.
Value adjustments present a total capital gain of TDKK 3,917,
compared to a capital gain of TDKK 10,992 for the same pe-
riod in 2023. In terms of value adjustments alone, the Bank’s
holdings of sector equities performed negatively, although this
should be viewed against share dividends, as described above.
The currency area performed favourably in the first half-year.
Based on the level of interest rates, the Bank's bond holdings
also gave capital gains in the first half of 2024, although lower
than for the same period in 2023.
Selected Highlights and Key Figures (not audited)
DKK 1,000
Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3
2024
2024
2023
2023
2023
2023
2022
2022
Net interest and fee income
122,734
119,629
119,981
111,043
99,933
104,056
96,307
87,370
Costs, depreciation and amorti-
sation
58,299
59,186
61,918
51,492
51,814
56,914
59,254
48,059
Other operating income
1,316
1,301 1,346
1,451
1,613
1,392
2,025 1,514
Profit before value adjustments
and write-downs
65,751
61,744 59,409
61,002
49,732
48,534
39,078 40,825
Value adjustments
-1,450
5,367
20,248
8,817
3,085
7,907
6,316
-20,477
Write-downs on loans, etc.
5,946
5,326
5,907
1,974
-713
6,992
1,483
928
Profit before tax
58,355
61,785 73,750
67,845
53,530
49,449
43,911 19,420
Interim Report
First Half of 2024
Management’s Review
6
Impairment of loans, etc. amounted to TDKK 11,272, com-
pared to TDKK 6,279 for the same period in 2023. The Bank
sees continued satisfactory creditworthiness in the loan port-
folio. The impairment level is still modest and the impairment
ratio for the period is 0.2%.
Despite uncertain macroeconomic prospects as a consequence
of rising inflation, a higher interest rate level and geopolitical in-
stability, Greenland and the BANK of Greenland’s customers
are not significantly challenged so far. However, the future eco-
nomic development is subject to uncertainty.
In addition to the individual write-downs, on this basis the Bank
has maintained a significant management reserve of DKK 44.8
million to counter risks.
The profit before tax is TDKK 120,140, having increased by
TDKK 17,161 from the same period of 2023.
Development during the quarter
Net interest and fee income amounted to TDKK 119,629 in
Q1, and TDKK 122,734 in Q2. This can primarily be related to
the continued positive development in the Bank's lending.
Total costs in Q1 amounted to TDKK 59,186 and in Q2 to
TDKK 58,299. Staff expenses decreased in Q2, since in Q1
there is payment of holiday allowance, etc., which is not paid in
the subsequent quarters. Other administration costs were by
and large unchanged between the quarters.
The profit before value adjustments and write-downs thereby
increased to TDKK 65,751 in Q2, which is TDKK 4,007 higher
than in Q1 2024. The profit before tax declined to DKK 58.4
million in Q2 2024, from DKK 61.8 million in Q1 2024.
Lending increased by TDKK 78,749 in Q1, and by TDKK
205,578 in Q2, which overall corresponds to an increase of
5.9% from the end of 2023. At the start of the year, it was ex-
pected that the favourable economic development in Green-
land would increase the Bank's lending.
Deposits increased by TDKK 268,070 in Q1 2024, but de-
creased by TDKK 127,656 in Q2. In overall terms, the increase
in deposits from the end of 2023 thus amounts to TDKK
140,414.
Balance sheet and equity
During the first half-year, the Bank’s lending showed a satisfac-
tory increase of TDKK 284,327 to TDKK 5,097,302, while the
Bank’s guarantees to customers decreased by TDKK 41,293
from the end of 2023 and amounted to TDKK 1,796,756 at
the end of June 2024. The Bank has entered into a new guaran-
tee agreement with DLR Kredit, which entails lower guarantee
provision than before. The agreement has a partial effect in Q2
2024 and the rest of the effect in Q3 2024.
In the first half of 2024 the Bank acquired five new staff homes,
increasing the value of domicile properties to TDKK 310,998.
At the end of June 2024, the Bank’s deposits, which predomi-
nantly comprise on-demand deposits, amounted to TDKK
6,553, which is an increase of TDKK 268,070 from the end of
2023. The Bank continues to have a stable deposit/lending ratio
of approximately 137%.
After payment of the dividend of TDKK 99,000 for 2023
adopted by the Annual General Meeting, the Bank’s equity in-
creased from TDKK 1,479,123 to TDKK 1,497,207.
Total assets thereby increased by TDKK 215,846 to TDKK
9,056,827.
Uncertainty of recognition and measurement
The principal uncertainties concerning recognition and meas-
urement are related to write-downs on lending, provisions on
guarantees and non-utilised credit facilities, together with the
valuation of properties, unlisted securities and financial instru-
ments. The management assesses that the presentation of the
accounts is subject to an appropriate level of uncertainty.
On 29 November 2023, the Danish Financial Supervisory
Authority published the memorandum “Loss levels on expo-
sures secured by mortgages in real estate”, in which the
Authority assesses whether there is a well-developed and well-
1.000.000
1.500.000
2.000.000
2.500.000
3.000.000
3.500.000
4.000.000
4.500.000
5.000.000
5.500.000
6.000.000
6.500.000
7.000.000
7.500.000
Q2 2021 Q2 2022 Q2 2023 Year 2023 Q2 2024
Deposits Lending Guarantees
Interim Report
First Half of 2024
Management’s Review
7
established real estate market in Denmark, the Faroe Islands
and Greenland.
Particularly with regard to the Faroe Islands and Greenland, ac-
cording to the memorandum it was not possible for the Danish
FSA, on the basis of the established criteria, to assess whether
there is a well-developed and well-established market for resi-
dential and commercial properties on the Faroe Islands and in
Greenland. The assessment has an impact on the capital burden
of exposures secured by mortgages on real estate.
The Danish FSA therefore subsequently sent the memorandum
for consultation and contacted the North Atlantic banks, includ-
ing the BANK of Greenland, as well as mortgage credit insti-
tutes with North Atlantic property exposures, for further in-
vestigation of the real estate market in Greenland.
On this basis, the BANK of Greenland provided the Danish
FSA with a supplementary basis of experience based on local
knowledge of Greenland's real estate market, in order to sup-
port an assessment of whether a well-developed and well-es-
tablished real estate market exists in Greenland.
Clarification of the property market's status in Greenland is not
expected until Q3 2024.
Financial risks
The BANK of Greenland is exposed to various financial risks,
which are managed at different levels of the organisation. The
Bank’s financial risks consist of:
Credit risk: Risk of loss as a consequence of debtors’ or coun-
terparties’ default on actual payment obligations.
Market risk: Risk of loss as a consequence of fluctuation in the
fair value of financial instruments and derivative financial instru-
ments due to changes in market prices. The BANK of Green-
land classifies three types of risk within the market risk area: in-
terest rate risk, foreign exchange risk and share risk.
Liquidity risk: Risk of loss as a consequence of the financing
costs increasing disproportionately, the risk that the Bank is
prevented from maintaining the adopted business model due to
a lack of financing/funding, or ultimately, the risk that the Bank
cannot fulfil agreed payment commitments when they fall due,
as a consequence of the lack of financing/funding.
Operational risk: The risk that the Bank in full or in part incurs
financial losses as a consequence of inadequate or inappropri-
ate internal procedures, human errors, IT systems, etc.
Capital requirement
The BANK of Greenland must by law have a capital base that
supports the risk profile. The BANK of Greenland compiles the
credit and market risk according to the standard method and
the operational risk according to the basic indicator method.
MREL requirement
The requirement concerning own funds and eligible liabilities
must be viewed as an element of the recovery and resolution
of banks. This entails that banks which are subject to this re-
quirement must maintain a ratio of capital instruments and debt
obligations that, in a resolution situation, can be written down
or converted before simple claims.
On 30 November 2023, a revised MREL requirement was de-
termined for the BANK of Greenland, at 30.2% of the Bank’s
risk-weighted assets at the end of 2022. The MREL require-
ment is being phased in during the period from 2022 to 2027.
The linear phasing-in means that by 2024, the Bank must fulfil
an MREL requirement of 7.55%. This means that in the course
of the coming years, the Bank must fulfil the phased-in require-
ment by issuing capital instruments and consolidation of equity
capital.
In continuation of the established MREL requirement, the Bank
made issues in 2021, 2022 and 2023. A total of DKK 175
million was issued in Senior Non-Preferred and DKK 65 million
in subordinated debt.
In 2024, the Bank also expects to issue securities.
Capital requirement
First half-
year 2024
Year 2023
Pillar I
8.00% 8.00%
Pillar II
3.00% 3.06%
Solvency requirement
11.00%
11.06%
SIFI buffer requirement
1.50% 1.50%
Capital reserve buffer requirement
2.50% 2.50%
Capital requirement
15.00%
15.06%
MREL requirement (phased in linearly as
from 1 January 2022)
7.55% 4.90%
Total capital requirement
22.55%
19.96%
Capital base, cf. Note 18
1,450,360 1,450,158
SNP issue
174,133 173,969
MREL capital base
1,624,493
1,624,127
MREL capital ratio
29.00% 29.10%
Surplus capital cover
6.45%
9.14%
Interim Report
First Half of 2024
Management’s Review
8
Solid capital base
In accordance with the Danish Financial Business Act, the Board
of Directors and the Executive Management must ensure that
the BANK of Greenland has an adequate capital base. The capi-
tal requirement is the capital which, according to the manage-
ment’s assessment, as a minimum is needed to cover all risks.
The BANK of Greenland was designated as an SIFI institution in
April 2017.
Based on the requirements concerning own funds and eligible
liabilities, the Board of Directors expects that the total capital
reserves must be increased during the coming years. The aim of
the Board of Directors is that there must be sufficient capital
for growth in the Bank’s business activities, just as there must
be sufficient capital to cover ongoing fluctuations in the risks as-
sumed by the Bank.
In 2021, the Bank’s Board of Directors therefore adopted a
capital objective with a set target for CET1 of 24%. The BANK
of Greenland’s core capital ratio was 24.7 at the end of the first
half of 2024, and the capital ratio was 25.9. Taking account of
the uncertainties described above concerning exposures se-
cured by mortgages on real estate, the Bank considers it essen-
tial that the core capital ratio is at a higher level than the target
set
The result for the first half of 2024 has not been verified by the
Bank’s auditor and is therefore not included in the capital ratio.
Including the result for the first half of 2024, the core capital ra-
tio is calculated at 26.4% and the capital ratio at 27.6%.
As at the end of June 2024, the Bank's individual solvency re-
quirement was compiled at 11.0%. The BANK of Greenland
thereby has surplus capital cover before the buffer require-
ments of 14.9%, or TDKK 832,434. After deductions for the
capital reserve buffer requirement of 2.5% and the SIFI buffer
requirement of 1.5%, the surplus cover is 10.9%
The BANK of Greenland’s reported individual solvency requirement according to the 8+ model
First half-year 2024
Full year 2023
Capital
requirement
Solvency
requirement
Capital
requirement
Solvency
requirement
Pillar I requirement
448,812
8.0
445,843
8.0
Credit risk
117,936
2.1
120,061
2.2
Market risk
23,777
0.4
22,404
0.4
Operational risk
15,820
0.3
15,646
0.3
Other risk
11,581
0.2
12,256
0.2
Capital and solvency requirement
617,926
11.0
616,210
11.1
The BANK of Greenland has published further details of the
calculated solvency requirement in a report on its website
http://www.banken.gl/report/
Liquidity
The liquidity coverage ratio (LCR) is a minimum requirement of
the ratio between current assets and liabilities, to ensure a satis-
factory liquidity ratio.
At the end of Q2, the Bank had an LCR of 234.4% and thereby
fulfils the LCR requirement of at least 100%.
The Bank’s required funding is based solely on deposits.
The Supervisory Diamond for banks
The BANK of Greenland has considered the benchmarks set
out in the Danish FSA’s Supervisory Diamond for banks. The
The Supervisory Diamond
First half-
year 2024
Limit
Sum of large exposures
151.7% < 175%
Property exposure
19.2% < 25%
Growth in lending
9.90% < 20%
Liquidity
-benchmark 237.0% > 100%
Interim Report
First Half of 2024
Management’s Review
9
Supervisory Diamond states five benchmarks for banking activi-
ties which the Bank aims to fulfil. It should be noted that total
large exposures comprise publicly owned companies at a ratio
of 44% points.
The property exposure amounts to 19.2%. This exposure is
subject to considerable subordinate public financing. In addition,
some of the exposure is based on lease contracts with the
state, the Government of Greenland or municipalities. The
Bank assesses that both of these factors contribute to stabilising
the overall sector exposure.
Investor Relations
The BANK of Greenland’s overall financial objective is to
achieve a competitive return for the shareholders. At a price of
660 at the end of the first half of 2024, the price of the BANK
of Greenland’s shares has increased from the end of 2023,
when the price was 625.
At the Bank’s Annual General Meeting on 20 March 2024, a
dividend payment of DKK 55 per share, or a total of DKK 99
million, to the Bank’s shareholders was adopted, and this was
paid out on 25 March 2024.
In accordance with Section 28a of the Danish Companies Act,
six shareholders have notified shareholdings in excess of 5%.
The Bank has no holdings of own shares.
The BANK of Greenland’s mission, values and cor-
porate governance
The BANK of Greenland conducts banking activities in Green-
land in open competition with domestic and foreign banks and
provides advice and services in the financial area to all citizens
and businesses in Greenland.
The Bank's mission should be viewed in a broader perspective
whereby the BANK of Greenland can be seen as the BANK for
all of Greenland. This entails an enhanced responsibility to par-
ticipate positively and actively in society’s development and to
help to create opportunities for the benefit of Greenland, while
also ensuring sound financial activities. The BANK of Greenland
is highly aware of this vital role.
The BANK of Greenland’s values are firmly anchored in the
Bank and its employees. The values are Commitment, Decency,
Customer-oriented and Development-oriented. These values
serve as a guide for how we act and wish to be seen within
and outside the Bank.
The BANK of Greenland considers all of the Corporate
Governance recommendations and the Danish Executive
Order on Management and Control of Banks, etc. and it is the
Bank’s objective to observe these recommendations at all times
and to the greatest possible extent. The Bank’s Corporate
Governance Statement can be found on the Bank’s website
www.banken.gl
.
Outlook for the remainder of 2024
Despite inflation and interest rate increases, the BANK of
Greenland expects moderate economic growth in Greenland in
2024, as described in the 2023 Annual Report.
On this basis lending is expected to develop positively in 2024,
but with lower growth than in the preceding two years. It is
not unlikely that up to the end of 2024 lending may decline
slightly from the level at the end of the first half of 2024.
Deposits are expected to be at the end-2023 level, or moder-
ately increasing.
The Bank will be affected negatively if inflation and cyclical
trends are exacerbated to any significant degree.
Total core income is expected to increase in 2024, for which
the primary reasons are the increased lending volume and the
development in interest rates.
Total expenses including depreciation and amortisation are ex-
pected to be higher than in 2023. A few staff increases and the
full effect of staff increases are expected in 2023. Administra-
tion expenses are also expected to increase, primarily in the IT
area and for supplementary staff training.
The Bank assesses that the quality of the loan portfolio is satis-
factory. Write-downs on loans are therefore still expected to
be at a low, but normalised, level.
On the basis of the level of interest rates, gains must be ex-
pected on the Bank’s listed securities. Capital gains are ex-
pected from the currency area and sector equities.
In the stock exchange announcement of 24 July 2024, the fore-
cast profit before tax for the year was adjusted upwards to a
range of DKK 200-240 million, which remains unchanged.
Interim Report
First Half of 2024
Management Statement
10
The Board of Directors and Executive Management have today
considered and approved the Interim Report for the period
from 1 January to 30 June 2024, for the public limited liability
company, GrønlandsBANKEN A/S..
The interim report was prepared in accordance with the Dan-
ish Financial Business Act, and the Management’s Review was
drawn up in accordance with the Danish Financial Business Act.
The interim report is furthermore prepared in accordance with
additional Danish disclosure requirements for listed financial
companies.
It is our opinion that the Interim Report gives a true and fair
view of the Bank’s assets, liabilities and financial position at 30
June 2024, and of the result of the Bank’s activities for the first
half of 2024.
It is our opinion that the Management’s Review gives a true and
fair review of the development in the Bank’s activities and finan-
cial affairs, as well as a description of the significant risks and un-
certainties to which the BANK of Greenland is subject.
Management Statement
Nuuk, 21 August 2024
Executive Management
Martin Birkmose Kviesgaard
Board of Directors
Gunnar í Liða
Kristian
Frederik Lennert
Maliina Bitsch Abelsen
Chair
Vice Chair
Lars Holst
Pilunnguaq Frederikke Johansen Kristiansen
Tulliaq Angutimmarik Olsen
Niels Peter Fleischer Rex
Peter Angutinguaq Wistoft
Ellen Dalsgaard Zdravkovic
Interim Report
First Half of 2024
Management Statement
11
Interim Report First Half of 2024
Income Statement and Statement of Comprehensive Income
12
Income Statement and Statement of Comprehensive
Income
DKK 1,000
Notes
First half-
year
2024
Full year 2023
First half-
year
2023
3
Interest income
244,737
417,162
186,541
4
Interest expenses
60,718
87,468
36,019
Net interest income
184,019
329,694
150,522
Share dividend, etc.
8,859
2,155
2,155
5
Fees and commission income
49,588
103,932
51,477
Fees paid and commission expenses
103
769
164
Net interest and fee income
242,363
435,012
203,990
6
Value adjustments
3,917
40,058
10,992
Other operating income
2,617
5,803
3,005
7
Staff and administration expenses
110,806
211,166
102,828
Depreciation and impairment of tangible assets
4,316
8,158
4,035
Other operating expenses
2,363
2,815
1,866
16
Write
-downs on loans and receivables, etc. 11,272
14,160
6,279
Profit before tax
120,140
244,574
102,979
8
Tax
5,285
52,179
16,746
Profit for the period
114,855
192,395
86,233
COMPREHENSIVE INCOME
Profit for the period
114,855
192,395
86,233
Other comprehensive income:
Value adjustment of properties
2,972
5,643
2,772
Value adjustment of defined-benefit severance/pension scheme
0
-96
0
Tax on value adjustment of properties
-743
-1,411
-693
Other comprehensive income
2,229
4,136
2,079
Comprehensive income for the period
117,084
196,531
88,312
Interim Report First Half of 2024
Balance Sheet
13
Balance Sheet
DKK 1,000
Notes
Assets
30 June 2024
31 December
2023
30 June 2023
Cash balance and demand deposits with central banks
1,452,389
1,552,747
1,253,559
9
Receivables from credit institutions and central banks
92,494
120,150
122,634
16
Loans and other receivables at amortised cost
5,097,302
4,812,975
4,638,998
10
Bonds at fair value
1,295,749
1,303,120
1,270,572
Shares, etc.
143,436
135,614
129,587
11
Assets connected to pool schemes
564,213
513,822
423,716
Land and
buildings in total, domicile properties 310,998
298,142
290,842
-
Domicile properties 310,998
298,142
290,842
Other tangible assets
8,085
6,781
6,425
Other assets
87,018
93,202
81,303
Accruals and deferred income
5,143
4,428
5,147
Total assets
9,056,827
8,840,981
8,222,783
Liabilities
Liabilities to credit institutions and central banks
15,427
22,105
20,063
12
Deposits and other liabilities
6,553,883
6,413,469
6,062,029
Deposits in pool schemes
564,213
513,822
423,716
13
Issued bonds at amortised cost
174,133
173,969
74,633
Current tax liabilities
28,272
11
44,108
Other liabilities
76,068
63,274
75,495
Prepayments and deferred expenses
6,441
5,451
6,266
Total debt
7,418,437
7,192,101
6,706,310
Provisions for pensions and similar obligations
2,662
2,506
2,246
Provisions for deferred tax
60,755
84,762
58,819
Provisions for losses on guarantees
6,604
9,733
11,331
Other provisions
6,752
8,427
8,926
Total provisions
76,773
105,428
81,322
14
Subordinated debt
64,410
64,329
64,247
Total subordinated debt
64,410
64,329
64,247
Equity
15
Share capital
180,000
180,000
180,000
Revaluation reserves 68,112
65,883
63,730
Retained earnings
1,249,095
1,134,240
1,127,174
Proposed dividend
0
99,000
0
Total equity
1,497,207
1,479,123
1,370,904
Total liabilities
9,056,827
8,840,981
8,222,783
1
Accounting policies applied
2
Accounting estimates
17
Contingent liabilities
18
Capital conditions and solvency
Interim Report First Half of 2024
Statement of Changes in Equity
14
Statement of Changes in Equity
DKK 1,000
Share capital
Revaluation
reserves
Retained ear-
nings
Proposed divi-
dend
Total equity
capital
Equity, 01 January 2023
180,000
61,651 1,040,941
36,000
1,318,592
Dividend paid
0
0
0
-36,000
-36,000
Other comprehensive income
0
2,079
0
0
2,079
Profit for the period
0
0 86,233
0
86,233
Equity, 30 June 2023
180,000
63,730
1,127,174
0
1,370,904
Other
comprehensive income 0
2,153 -96
0
2,057
Profit for the period
0
0 7,162
99,000
106,162
Equity, 31 December 2023
180,000
65,883 1,134,240
99,000
1,479,123
Equity, 01 January 2024
180,000
65,883 1,134,240
99,000
1,479,123
Dividend paid
0
0 0
-99,000
-99,000
Other comprehensive income
0
2,229 0
0
2,229
Profit for the period
0
0 114,855
0
114,855
Equity, 30 June 2024
180,000
68,112 1,249,095
0
1,497,207
Interim Report First Half of 2024
Statement of Changes in Equity
15
Interim Report First Half of 2024
16
1. Accounting policies applied etc. 17
2. Significant accounting estimates 17
3. Interest income 18
4. Interest expenses 18
5. Fee and commission income 18
6. Value adjustments 18
7. Staff and administration expenses 19
8. Tax 19
9. Amounts receivable from credit institutions and central banks 19
10. Bonds 19
11. Assets connected to pool schemes 20
12. Deposits 20
13. Issued bonds at amortised cost 20
14. Subordinated debt 21
15. Share capital 21
16. Loans 21
17. Contingent liabilities 25
18. Capital conditions and solvency 25
Overview of Notes
Interim Report First Half of 2024
Notes to the Interim Report
17
The Interim Report has been prepared in accordance with the
Danish Financial Business Act, the statutory order on financial
reports for credit institutions and investment service compa-
nies, etc. and the Danish disclosure requirements for the in-
terim reports of listed financial companies.
The accounting policies applied are unchanged from the Annual
Report for 2023.
Tax, which consists of current tax and changes in deferred tax,
is recognised in the income statement when it relates to the
profit for the period, and directly in equity when it can be at-
tributed to items carried directly to equity.
On calculating the taxable income, Greenland allows tax deduc-
tion of dividends for the dividend-paying company. The taxation
value of this is therefore added to equity at the time of the
Annual General Meeting’s approval of the dividend.
Deferred tax assets are recognised in the balance sheet at the
value at which the asset is expected to be realised. The interim
report has not been audited or reviewed.
The calculation of the accounting value of certain assets and lia-
bilities is subject to a degree of uncertainty and an estimate of
how future events will affect the value of these assets and liabil-
ities. The most significant estimates relate to:
• measurement of loans, guarantees and non-utilised credit
facilities;
• financial instruments;
• fair value of domicile properties; and
• provisions.
Non-listed financial instruments that primarily concern sector
equities and that are measured at estimated fair values.
The measurement of the fair value of the Bank’s head office
properties is subject to significant accounting estimates and as-
sessments, including expectations of the properties’ future re-
turns and the fixed yield ratios.
For provisions, there are significant estimates related to the de-
termination of the future employee turnover rate, as well as
determining the interest obligation for tax-free savings accounts.
Notes to the Interim Report
1.
Accounting policies applied etc.
2.
Significant accounting estimates
Interim Report First Half of 2024
Notes to the Interim Report
18
DKK 1,000
First half-
year
2024
Full year
2023
First half-year
2023
3. Interest income
Lending and other receivables
193,213
336,767
153,490
Bonds
18,229
29,770
12,912
Foreign exchange, interest rate, equity, commodity and other contracts, as
well as derivative financial instruments
571
1,177
576
Total interest income
244,737
417,162
186,541
4. Interest expenses
Credit institutions and central banks
37
151
81
Deposits and other liabilities
60,681
87,256
35,938
Issued Bonds
0
61
0
Total interest expenses
60,718
87,468
36,019
5. Fee and commission income
Securities and securities accounts
1,234
7,780
1,404
Payment settlement
18,079
37,456
18,301
Loan transaction fees
1,914
4,968
2,604
Guarantee commission
15,360
31,134
15,999
Other fees and commission
13,001
22,594
13,169
Total fee and commission income
49,588
103,932
51,477
6. Value adjustments
Lending at fair value
1
1,983
480
Bonds
2,097
23,654
4,134
Shares
-1,192
10,178
3,967
Currency
3,008
6,253
2,966
Foreign exchange, interest rate, equity, commodities and other contracts, as
well as derivative financial instruments
3
-2,010
-555
Assets connected to pool schemes
37,221
42,371
23,901
Deposits in pool schemes
-37,221
-42,371
-23,901
Total value adjustments
3,917
40,058
10,992
Interim Report First Half of 2024
Notes to the Interim Report
19
7. Staff and administration expenses
Staff expenses
Salaries 49,824
93,862
44,909
Other staff expenses 2,110
3,068
1,654
Pensions 6,224
11,613
5,591
Social security expenses 195
569
284
In total 58,353
109,112
52,438
Other administration expenses
52,453
102,054
50,390
Average number of FTEs
153.7
143.5
140.2
Of which salaries and remuneration to the Board of Directors and the Exec-
utive Management
3,332
6,345
3,176
Six other employees (Q2 2023: 5 employees) whose activities have a signifi-
cant influence on the Bank’s risk profile:
Salaries including free car and other benefits
3,988
7,373
3,210
8. Tax
25
-% of the profit before tax 30,035
61,144
25,746
Discount for dividend tax paid
-1,982
-498
-498
6
-%-supplement 0
0
0
Total tax on ordinary profit
28,053
60,646
25,248
Paid dividend tax
1,982
498
498
Other changes
0
35
0
Taxation value of dividend paid
-24,750
-9,000
-9,000
Tax in total
5,285
52,179
16,746
Deferred tax
743
16,225
693
Taxation value of dividend paid
-24,750
0
-9,000
Tax to be paid
29,292
35,954
25,053
No company tax was paid in the period.
9. Amounts receivable from credit institutions and central banks
Receivables from credit institutions 92,494
120,150
122,634
Total amounts receivable
92,494
120,150
122,634
10. Bonds
Of the bond portfolio, a nominal amount of TDKK 50,000 is pledged as collateral for accounts with Danmarks Nationalbank.
DKK 1,000
First half-
year
2024
Full year
2023
First half-year
2023
Interim Report First Half of 2024
Notes to the Interim Report
20
11. Assets connected to pool schemes
Investment associations
564,149
513,734
423,623
Non
-invested funds 64
88
93
Total
564,213
513,822
423,716
12. Deposits
On demand
5,389,805
5,265,508
5,409,658
On terms of notice
872,785
858,360
378,619
Special deposit conditions
291,293
289,601
273,752
Total deposits
6,553,883
6,413,469
6,062,029
13. Issued bonds at amortised cost
Bond issue
174,133
173,969
74,633
Total
174,133
173,969
74,633
Loan raised as
Senior Non-Preferred, nominally 50,000
50,000
50,000
The loan was raised as Senior Non
-Preferred on 27 October 2021 and falls
due for full redemption on 27 October 2026. The Bank has the option of
early redemption as from 27 October 2025.
Loan raised as Senior Non
-Preferred, nominally 25,000
25,000
25,000
The loan was raised as Senior Non
-Preferred on 2 September 2022 and falls
due for full redemption on 2 September 2027. The Bank has the option of
early redemption as from 2 September 2026.
Loan raised as Senior Non
-Preferred, nominally 100,000
100,000
0
The loan was raised as Senior Non
-Preferred on 1 December 2023 and falls
due for full redemption on 1 December 2030. The Bank has the option of
early redemption as from 1 December 2027.
DKK 1,000
First half-
year
2024
Full year
2023
First half-year
2023
Interim Report First Half of 2024
Notes to the Interim Report
21
14. Subordinated debt
Capital certificate as below
64,410
64,329
64,247
In total
64,410
64,329
64,247
Subordinated debt included in the capital base according to CRR
64,410
64,329
64,247
Loan raised as
subordinated debt, nominally 25,000
25,000
25,000
Interest rate, fixed rate
6.197%
6.197%
6.197%
The loan was raised on 2 September 2022 and falls due for full redemption
on 2 september 2032. The Bank has the option of early redemption as from
2 September 2027.
Loan raised as subordinated debt, nominally
40,000
40,000
40,000
Interest rate, floading rate (CIBOR 6 with an addition of 400bp.)
7.827%
8.113%
7.800%
The loan was raised on 1 June 2023 and falls due for full redemption on 1
June 2033. The Bank has the option of early redemption as from 1 June
2028.
15. Share capital
Share capital consits of 1,800,000 shares of DKK 100.
Own shares
Number of own shares
0
0
0
16. Loans
Write
-downs on loans, guarantees and non-utilised credit facilities:
New write
-downs concerning new facilities during the period 5,602
16,292
9,410
Reversal of write
-downs concerning redeemed facilities -5,763
-16,688
-7,267
Net write
-downs during the period as a consequence of changes in the
credit risk
11,739
14,998
4,568
Losses without preceding write
-downs 95
158
94
Received for claims previously written off
-401
-600
-526
Recognised in the statement of income
11,272
14,160
6,279
DKK 1,000
First half-
year
2024
Full year
2023
First half-year
2023
Interim Report First Half of 2024
Notes to the Interim Report
22
DKK 1,000
Stage 1 Stage 2
Stage 3
Total
Write-downs on loans
30.06.2024
Start of the period
27,301 78,003
90,562
195,866
New write
-downs concerning new facilities during the
year
1,014 4,021
351
5,386
Reversal of write
-downs concerning redeemed facilities -986 -826
-1,843
-3,655
Change in write
-downs at the beginning of the year –
transfer to stage 1
6,501 -4,995
-1,506
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-1,011 3,184
-2,173
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-8 -221
229
0
Net write
-downs as a consequence of changes in the
credit risk
-7,705 21,342
304
13,941
Previously written down, now finally lost
-287
-287
Interest on written
-down facilities
2,872
2,872
Write
-downs in total 25,106 100,508
88,509
214,123
Write-downs on guarantees
30.06.2024
Start of the period
1,096 2,695
5,942
9,733
New write
-downs concerning new facilities during the
year
78 116
0
194
Reversal of write
-downs concerning redeemed facilities -1 -3
-13
-17
Change in write
-downs at the beginning of the year –
transfer to stage 1
1,897 -347
-1,550
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-4 78
-74
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-2 0
2
0
Net
write-downs as a consequence of changes in the
credit risk
-2,095 -748
-463
-3,306
Write-downs in total
969
1,791
3,844
6,604
Write-downs on non-utilised drawing rights
30.06.2024
Start of the period
345 517
1,847
2,709
New write
-downs concerning new facilities during the
year
20 2
0
22
Reversal of write
-downs concerning redeemed facilities -112 -372
-1,607
-2,091
Change in write
-downs at the beginning of the year –
transfer to stage 1
204 -87
-117
0
Change in
write-downs at the beginning of the year –
transfer to stage 2
-15 15
0
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
0 0
0
0
Net write
-downs as a consequence of changes in the
credit risk
8 471
626
1,104
Write
-downs in total 450 546
749
1,744
Interim Report First Half of 2024
Notes to the Interim Report
23
Write-downs on loans
31.12.2023
Start of the period
28,826 64,706
86,477
180,009
New write
-downs concerning new facilities during the
year
5,007 9,510
1,016
15,533
Reversal of write
-downs concerning redeemed facilities -3,019 -2,942
-7,625
-13,586
Change in write
-downs at the beginning of the year –
transfer to stage 1
6,524 -5,889
-635
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-1,354 7,445
-6,091
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-136 -1,229
1,365
0
Net write
-downs as a consequence of changes in the
credit risk
-8,547 6,402
15,215
13,070
Previously
written down, now finally lost
-3,593
-3,593
Interest on written
-down facilities
4,433
4,433
Write
-downs in total 27,301 78,003
90,562
195,866
Write-downs on guarantees
31.12.2023
Start of the period
1,239 1,025
5,772
8,036
New
write-downs concerning new facilities during the
year
201 414
16
631
Reversal of write
-downs concerning redeemed facilities -2 -3
-68
-73
Change in write
-downs at the beginning of the year –
transfer to stage 1
2,070 -154
-1,916
0
Change in
write-downs at the beginning of the year –
transfer to stage 2
-117 179
-62
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-7 -48
55
0
Net write
-downs as a consequence of changes in the
credit risk
-2,288 1,282
2,145
1,139
Write
-downs in total 1,096 2,695
5,942
9,733
Write-downs on non-utilised drawing rights
31.12.2023
Start of the period
498 547
3,776
4,821
New write
-downs concerning new facilities during the
year
21 107
0
128
Reversal of
write-downs concerning redeemed facilities -159 -34
-2,836
-3,029
Change in write
-downs at the beginning of the year –
transfer to stage 1
28 -3
-25
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-6 497
-491
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
0 -1
1
0
Net write
-downs as a consequence of changes in the
credit risk
-37 -596
1,422
789
Write
-downs in total 345 517
1,847
2,709
DKK 1,000
Stage 1 Stage 2
Stage 3
Total
Interim Report First Half of 2024
Notes to the Interim Report
24
Write-downs on loans
30.06.2023
Start of the period
28,826 64,706
86,477
180,009
New write
-downs concerning new facilities during the
year
2,795 5,068
884
8,747
Reversal of write
-downs concerning redeemed facilities -2,229 -1,680
-2,582
-6,491
Change in write
-downs at the beginning of the year –
transfer to stage 1
4,701 -3,134
-1,567
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-954 6,004
-5,050
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-130 -420
550
0
Net write
-downs as a consequence of changes in the
credit risk
-6,862 2,145
6,565
1,848
Previously written down, now finally lost
0 0
-655
-655
Interest on written
-down facilities 0 0
2,350
2,350
Write
-downs in total 26,147 72,689
86,972
185,808
Write-downs on guarantees
30.06.2023
Start of the period
1,239 1,025
5,772
8,036
New write
-downs concerning new facilities during the
year
178 133
0
311
Reversal of write
-downs concerning redeemed facilities -1 -5
-43
-49
Change in write
-downs at the beginning of the year –
transfer to stage 1
454 -38
-416
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-91 173
-82
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
-10 -48
58
0
Net write
-downs as a consequence of changes in the
credit risk
-689 224
3,498
3,033
Write
-downs in total 1,080 1,464
8,787
11,331
Write-downs on non-utilised drawing rights
30.06.2023
Start of the period
498 547
3,776
4,821
New write
-downs concerning new facilities during the
year
13 318
21
352
Reversal of write
-downs concerning redeemed facilities -51 -25
-651
-727
Change in
write-downs at the beginning of the year –
transfer to stage 1
10 -1
-9
0
Change in write
-downs at the beginning of the year –
transfer to stage 2
-5 12
-7
0
Change in write
-downs at the beginning of the year –
transfer to stage 3
0 -1
1
0
Net write
-downs as a consequence of changes in the
credit risk
282 -79
-516
-313
Write
-downs in total 747 771
2,615
4,133
DKK 1,000
Stage 1 Stage 2
Stage 3
Total
Interim Report First Half of 2024
Notes to the Interim Report
25
17. Contingent liabilities
Mortgage finance
guarantees 930,587
1,042,320
1,013,262
Registration and remortgaging guarantees
278,852
182,870
220,673
Other guarantees
523,694
549,236
596,410
Guarantees, etc. in total
1,733,133
1,774,426
1,830,345
Provision balance for guarantees
6,604
9,733
11,331
Provision balance for non
-utilised credit facilities 1,744
2,709
4,133
The Bank is a member of BEC (BEC Financial Technologies a.m.b.a.). On any withdrawal the Bank will be obliged to
pay a withdrawal
fee to BEC equivalent to the preceding three years’ IT costs.
Like the rest of the Danish banking sector, the Bank has an obligation to make payments to the Guarantee Fund and the Resolut
ion
Fund.
18. Capital conditions and solvency
Credit risk
4,673,441
4,607,677
4,619,682
CVA risk
10,146
10,267
13,915
Market risk
204,957
233,494
266,011
Operational risk
721,601
721,601
628,793
Total risk exposure
5,610,145
5,573,039
5,528,401
Equity at the
beginning of the period 1,479,123
1,318,592
1,318,592
Comprehensive income for the period
0
196,531
0
Proposed dividend, accounting effect
24,750
-74,250
9,000
Paid dividend
-99,000
-36,000
-36,000
Framework for ratio of own shares
-5,985
-11,250
-11,250
Deduction for capital shares in the financial sector
-2,848
0
-570
Deductions for prudent valuation
-1,443
-1,443
-1,406
Deductions for Non
-Performing Exposures -8,647
-6,351
-13,548
Actual core capital
1,385,950
1,385,829
1,264,818
Supplementary capital
64,410
64,329
64,247
Capital base
1,450,360
1,450,158
1,297,225
Actual core capital ratio
25.9
26.0
24.0
Capital ratio
24.7
24.9
22.9
Statutory capital ratio
requirements 8.0
8.0
8.0
DKK 1,000
First half-
year
2024
Full year
2023
First half-year
2023
Interim Report First Half of 2024
Notes to the Interim Report
26