Danish Local Banks Gain as Writedowns Dip: Copenhagen Mover
Denmark’s small and medium-sized banks rose to their highest in Copenhagen trading in more than two months amid speculation that writedowns will ease.
A Bloomberg index of Denmark’s 23 listed commercial banks with market capitalization of 1 billion kroner ($175 million) or less rose 1.4 percent to its highest since Feb. 4. Skjern Bank A/S, which today repaid the last of its government-backed debt, rose as much as 12 percent.
Smaller lenders’ writedowns of business loans fell in the first quarter and were unchanged for personal loans, according to the most recent central bank data. Last year, impairments climbed as lenders implemented new, tougher regulations by the Financial Supervisory Authority.
“It could point to a slightly improved situation for the smaller banks,” Mads Thinggaard, a bank analyst at Nykredit A/S, said. “Perhaps the market figures the implementation of the new writedown rules is over, and since the banks are still up and running, it may see some kind of upside.”
Skjern Bank (SKJE), based in the Danish town of the same name, gained as much as 2.9 kroner to 28 kroner, its highest level since Dec. 21, after saying it had repaid the last 98 million kroner of 152 million kroner it held in state-backed debt. The share rose 1.56% to 25.50 kroner at 1:21 p.m. local time.
To contact the reporter on this story: Frances Schwartzkopff in Copenhagen at firstname.lastname@example.org