Seven Danish banks at risk of bankruptcy, according to report
Seven Danish financial institutions are at risk of going under, according to the results of the latest annual report on Danish financial institutions by the banking consultancy BankResearch, Berlingske Business reports.
The report is intended to give bank customers and shareholders a measure of the risk the country’s institutions are exposed to. Each institution is assigned a rating, where 700 is the absolute highest risk and anything over 500 gives cause for concern.
This was the case for Danske Andelskassers Bank, Vestjysk Bank, Skjern Bank, Salling Bank, Den Jyske Sparekasse, Østjydsk Bank, and Andelskassen JAK Slagelse.
The failed banks Spar Lolland, Fjordbank Mors and Max Bank all had ratings of over 500 in previous reports. Nicholas Rhode, the head of BankResearch, explained that it was cause for concern.
“It would be wrong to say that because you’ve got a risk index of over 500 you’ve got one foot in the grave,” he said.
“But you can say there is an increased risk associated with these institutions compared to others.”
He advises customers to keep deposits in these banks under the limit the deposit guarantee fund covers.
“I think that people should be aware that as private customers they don’t exceed 750,000 kroner in net deposits,” he said.
“There’s no point in taking that risk.”