The fallout from Denmark's banking crisis is not yet over, according to Standard & Poor's Ratings Services. In fact, we believe that more Danish banks will fail due to commercial property and agricultural finance loan losses made during a short boom in 2005-2007. (Listen to the related podcast, "Why More Danish Banks Are Likely To Fail," published August 2, 2011). In our view, as many as 15 Danish banks could default, although we consider the likely cost to the country's remaining banks through direct exposure and a system-wide deposit insurance scheme to be manageable within our current rating expectations. In our base-case assumption, we estimate the gross loss due to additional bank failures to be Danish krona (DKK) 6 billion-DKK12...
Companies mentioned in this report are:
- Danske Bank A/S
- Skandinaviska Enskilda Banken AB (publ)
- Swedbank AB
- Svenska Handelsbanken AB
- Nykredit Realkredit A/S
- Nordea Bank Danmark A/S
- Nordea Bank AB
- Jyske Bank A/S
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Research Type: Commentary
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