We have completed 99 % of the process of setting debt to zero for relevant customers, which was announced in August 2022.

Moreover, we have paid (or have attempted to pay in case of lacking payment details) compensation to more than 85% of the customers in whose cases we estimate that overcollection may have taken place, excluding the remaining customer groups with particularly complex cases, including estate cases.

The impartial reviewers’ report

The impartial reviewers tasked by the Danish Financial Supervisory Authority (the Danish FSA) with monitoring Danske Bank’s work on solving its debt collection problems have completed their latest report.

We are pleased to see that, among other things, the impartial reviewers conclude in their report no. 5 that “…the bank has identified, with a high degree of probability, the customers who are entitled to compensation due to overcollection” and that “…the compensation model, in by far most cases, will lead to payment of compensation equal to or exceeding the loss incurred by the customers.”

In the coming period, we will begin the next phase of compensation payouts. This phase includes customers who may have been subject to overcollection in respect of home loans following a forced sale, complex cases involving consumer loan debt and amounts owed by small businesses.

When this phase has been completed, almost all customer groups that may have been subject to overcollection will have received compensation, with the exception of estate cases and special cases. The complexity of some smaller customer groups means that this work will continue into 2025.

In this connection, we note that the impartial reviewers acknowledge in their report that, also in relation to the group of customers with particularly complex cases, including estate cases, we can, with a high degree of certainty, identify those customers who may potentially have been subject to overcollection and pay compensation that, with a high or sufficient degree of probability, is equal to or exceeds the potential loss suffered by the customers - and that the bank’s calculation of compensation is made with the best interest of the customers in mind.

Estate cases and particularly complex cases

The work to close particularly complex cases, including estate cases continues. Moreover, the work to remediate the estate cases continues in cooperation with relevant external parties within the authorities and in the sector. This work along with remediation relating to small groups of particularly complex customer segments is expected to continue into 2025.

During the work to solve the issues relating to our debt collection, a number of additional issues have been identified. The majority of these issues are covered by the compensation model. Most of the remaining issues are either of no financial consequence to the customers or are issues for which the customers have already received compensation. In the event that additional issues are identified that do have consequences for affected customers, the bank will initiate remediation.

The remediation of additional issues and the total compensation expected to be paid out do not give rise to additional impairment charges or provisions other than those already announced.

The work to restart debt collection continues

As previously announced, we have entered into a cooperation with the Lowell debt collection agency on debt collection in Denmark. Since the most recent status in July 2023, we have restarted our debt collection to be gradually expanded to handle more and more types of cases, and we expect the system to be fully phased in by 2025.