Danish Business News Round-Up: Smaller banks gaining ground on scandal-ridden major operators - The Post

Danish Business News Round-Up: Smaller banks gaining ground on scandal-ridden major operators

Telia, Bang & Olufsen, PostNord and Volvo are also facing testing times, but no such worries at Ørsted

Besides, many claim the smaller banks provide a better service (photo: pxhere.com)
July 24th, 2019 1:12 pm| by Ben Hamilton

Small banks are gaining market share in Denmark in light of the scandals that have hit Danske Bank and Nordic-wide operator Nordea in recent years.

From money laundering (both banks) to general dissatisfaction (both banks) to making inaccurate profit promises (DB), many private customers are looking elsewhere.

Losing customers
In 2019 so far, Danske Bank has lost 13,600 private customers – 1 percent of its total – following on from an exodus of 11,000 in 2018. And Nordea is also losing customers.

While the country’s five largest banks saw lending growth rise by just 1.1 percent in 2018, it increased by between 5.5 and 6.7 percent at the small and medium-sized banks.

Profit decline
Danske Bank recently confirmed that its interim 2019 profit fell from 9.2 to 7.0 billion kroner.

Meanwhile, Nordea’s second quarter profit fell from 8.3 to 5.0 billion kroner.

Getting harder to change foreign currency at the banks
An increasing number of Danish banks have decided it is no longer worth their time changing your unspent holiday money back into Danish kroner. For example, Jyske Bank will still take euros, but will no longer bother with any other currencies. Several banks will continue to change currency but only at selected branches:  Danske Bank (48 nationwide), Sydbank (ten), Nordea (nine) and Alm Brand Brank (one).

Ørsted shares flying following stateside success
The Danish state is sitting on a tidy profit thanks to the dramatic increase in the value of Ørsted, which is today worth 265.7 billion kroner – nearly 160 billion more than its value at its IPO three years ago. The state retains a 50 percent stake in the company, which last week confirmed it has won a tender to build a 880 MW windfarm in the waters off Long Island in New York State. It follows fast on a similar project that it secured in New Jersey in June.

Ombudsman reports e-cigarette company to police
The Consumer Ombudsman has reported the e-cigarette company Smoke-IT to the police for breaking online advertising laws. Smoke-IT is accused of offering discounts and other promotions. According to Section 16 of the Electronic Cigarettes Act it is illegal to advertise e-cigarettes and refill containers to the public through any medium.

FC Roskilde offloads its mascot
The new owner of FC Roskilde has made his first significant cut since rescuing the Danish First Division club from bankruptcy: he has sold its mascot. The sea eagle Sigr lived in faraway north Jutland, and every time he made the journey to ‘The Eagle’s Nest’ it cost the club 8,500 kroner. “It was one of the first things I did,” Carsten Salomonsson told sn.dk. “It was simply the stupidest situation.” But it took him a while to find a buyer, eventually offloading the bird for 5,000 kroner – 60,000 less that what the club paid.

Danish unit of PostNord posts an improved result
The Danish unit of the Scandinavian postal service PostNord has posted a loss of 64 million Swedish krona for the first six months of 2019 – a vast improvement on the same period in 2018. Peter Kjær Jensen, the head of the Danish unit, is confident the company, which has made delivering parcels its core business, is on course to come out of the red in 2020. PostNord no longer delivers weekly newspapers or unaddressed advertisements, while letters (250-300 million a year) continue to be an unprofitable business.

Bang & Olufsen struggling, admits CEO
Bang & Olufsen chief executive Henrik Clausen admits the company is struggling following a financial result for the 2018-19 fiscal year that reveals a 14 percent fall in sales to 2.8 billion kroner along with a 77 percent slide in profits to 19 million kroner. Clausen attributed the downturn to “challenges with the conversion of our sales and distribution networks, as well as fewer product launches than the year before”.

Telia losing customers but still thriving
Nordic telecommunications company Telia lost 5,000 customers over the second quarter of 2019, leaving it with 18,000 fewer accounts than this time last year. However, its 2019 interim results reveal that its EBITA rose from 220 to 335 million kroner. Its rival 3 is meanwhile gaining customers and now has 1.387 million – not far off Telia’s 1.441 million. TDC and Telenor continue to be the market leaders.

Volvo recalls 6,500 cars as part of bid to fix over half a million
Volvo has recalled 6,500 cars in Denmark as a preventative measure over fears that a flaw could cause the engine compartment to catch fire. The affected cars are those with two-cylinder and four-cylinder diesel engines produced between 2014 and 2019. Volvo is confident the vehicles will be good to go following an adjustment to the structure and a software update. Worldwide, 503,000 cars have been recalled.

Mileage readings often fiddled 
One out of every 15 second-hand cars will have an altered mileage reading on its speedometer according to a DR analysis of data found by tjekbil.dk at the central registry, where the mileages of all cars are entered every two years.