Danske Bank in NI makes £80m pre-tax profit in nine months

The bank said that a surge in customer deposits experienced since the pandemic is now flattening off

Danske Bank in Northern Ireland made a pre-tax profit of almost £80m in the first nine months of 2022, up 60% on the same period last year.

The bank said the surge in deposits since the pandemic was flattening off.

In 2019, before the pandemic, the bank was holding deposits of £7.6bn which had swelled to £10.7bn this year.

The bank expects some customers will use the deposits they built up during the pandemic to help with the increased cost of living over the winter months.

Chief Executive Vicky Davies said the bank was "very conscious of the impact rising inflation and interest rates is having on our customers".

She added that so far this year it has contacted more than 10,000 customers "offering guidance and support directly relating to their financial circumstances".

However, there is so far little sign that lots of customers are unable to repay borrowings.

In the first nine months of the year the banks recorded loan loss provisions of £4.2m.

These provisions are money the bank must put aside to cover loans, which they assess are unlikely to be repaid in full.

There has been speculation that UK banks could face a windfall tax as part of the government's tax and spending plans.

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Currently banks pay an effective UK tax rate on their profits of 27%, made up of 19% corporation tax and an 8% bank surcharge.

Corporation tax is due to rise to 25% in April 2023, but it is not yet clear what will happen with the banks surcharge.