Danske could absorb $3.3B money-laundering fine and still hit own CET1 target
Sanne WassRehan Ahmad, 29 March 2021
Danske Bank A/S’ capital levels and projected first-quarter earnings imply that it could withstand a money-laundering fine of 20.9 billion kroner, or $3.3 billion, today and still achieve its management common equity Tier 1 ratio target of 16%, according to S&P Global Market Intelligence estimates.
Even a penalty of more than double that size would still leave Denmark’s largest lender above its current regulatory requirement, the analysis found. “There is a long way to go before the fine becomes an issue for the bank’s capital ratio,” said Jyske Bank equity analyst Anders Vollesen in an interview.
Danske’s material capital buffer is driving down risk associated with the outcome of its Baltic dirty money scandal, according to analysts, with some even seeing scope for distribution of excess capital to shareholders through generous dividends or share buybacks once the case is settled. Continue reading “Article: Danske could absorb $3.3B money-laundering fine and still hit own CET1 target”
