Danske Bank A/S

Danske Bank delivered a strong financial result with net profit of DKK 20.9bn (DKK 19.9bn) and a return on shareholder’s equity of 13.6%, well ahead of management’s own target of return on shareholder’s equity of at least 12.5%

ABOUT Danske Bank is a Nordic universal bank with four core Nordic markets (Denmark, Norway, Sweden and Finland) and four business segments (personal, business, corporate and institutions and wealth). The universal banking model provides a strong diversified platform delivering synergies across core markets.

A.P. Moller has been involved in Danske Bank since 1928 and in 2015, A.P. Moller Holding acquired a 20% direct ownership stake in Danske Bank. During 2017, Moody’s upgraded Danske Bank’s credit baseline to a3 from baa1. S&P and Fitch maintained their rating.

STRATEGY REVIEW Danske Bank’s vision is to become the most trusted financial partner by creating long-term value for all their stakeholders.

Danske Bank is focused on reacting to the rapid changes which the financial industry is currently undertaking, due to low interest rate environment, digitalization, changed customer expectations and demands, increased competition and increased regulation.

Danske Bank continues to focus on four strategic themes:

• Nordic potential

Realising full Nordic potential to diversify business and strengthen footprint supported by growth strategy in Sweden and Norway. • Digitalisation

Digitalisation offers opportunities to deliver on the strategy of becoming a more customer-driven, simple and efficient bank. • Customer experience

The customer promise and ambitions frame the experiences Danske Bank wants to deliver in creating a leading customer experience. • People and culture

Ensuring a high performing, agile organisation to match the increasing customer expectations remains a key priority.

THE YEAR IN BRIEF Danske Bank continued to successfully develop the partnership strategy in Norway and Sweden which has boosted its presence in the personal and business banking segments utilizing the potential as a challenger to the leading banks in the local markets. REVENUE (DKKm)

39,740 45,330 45,611 47,959 48,149

2013 2014 2015 2016 2017

NET PROFIT (DKKm)

7,115 3.948 13,123 19,858 20,900

2013 2014 2015 2016 2017

CET1 CAPITAL RATIO (%)

14.7% 15.1% 16.1% 16.3% 17.6%

2013 2014 2015 2016 2017

DIVIDEND YIELD (%)

1.6% 3.3% 4.3% 4.2% 4.1%

2013 2014 2015 2016 2017

As a result of driving a customer-centric agenda Danske Bank maintained its strong position in terms of customer satisfaction during 2017. Another critical focus area for Danske Bank is compliance. Danske Bank continues to strengthen their compliance functions across the bank and will continue to make substantial investments to prevent criminals from abusing their platforms to commit financial crimes. During 2017, serious questions were raised regarding Danske Bank’s compliance functions especially regarding events that took place in Danske Bank’s Estonia branch which indicates that the branch has been used for money laundering. We note that both the management and Board of Directors take this very seriously and have initiated a thorough investigation. We support Danske Bank’s continued focus on improving the compliance function and to participate in the fight against financial crime.

FINANCIALS Danske bank delivered a strong financial result in 2017 with net profit of DKK 20.9bn and a return on shareholder’s equity of 13.6%, well ahead of management’s own target of return on shareholder’s equity of at least 12.5% at latest in 2018.

Danske Bank’s CET1 capital ratio is end of 2017 17.6% well above the management target of 14—15% and the regulatory requirement of 12%. Based on the strong balance sheet Danske Bank proposed a DKK 10 per share dividend and a share buy-back programme to the tune of DKK 10bn (approx. USD 1.6bn). EXECUTIVE LEADERSHIP • Thomas Borgen • Jakob Aarup-Andersen • Tonny Thierry Andersen • James Ditmore • Carsten Egeriis • Lars Mørch • Jesper Nielsen • Glenn Soderstrom

BOARD OF DIRECTORS • Ole Andersen (Chairman) • Ingrid Bonde • Lars-Erik Brenøe • Jørn P. Jensen • Jens Due Olsen • Rolv Erik Ryssdal • Carol Sergeant • Hilde Merete Tonne • Kirsten Ebbe Brich • Charlotte Hoffmann • Bente Bang • Thorbjørn Lundholm Dahl

HIGHLIGHTS

Danske Bank has successfully launched a partnership strategy in Norway and Sweden which has boosted its presence in the personal and business banking segments utilizing the potential as a challenger to the leading banks in the local markets. Close to 50% of Danske Bank’ s lending book today is outside Denmark.

Digitalisation continues to transform the financial sector driven by customer expectations and new regulation. Across the Nordic region Danske focuses on being a front-runner in digitalisation, as Danske Bank sees digitalisation of end-toend processes as an opportunity to become a customer-driven, simple and efficient bank. Often these new digital solutions are created in partnerships like MobilePay and GateTu (a partnership with A.P. Moller – Maersk) established to develop new business-to-business solutions and services.