Our guidance for 2014 is based on expectations of slow and still fragile macroeconomic growth and a continuation of low interest rate levels in our core markets.
Furthermore, the guidance is based on accounting figures adjusted for the transfer of Personal Banking and Business Banking activities in Ireland to the Non-core unit effective from 1 January 2014 *see note.
We expect total income above the 2013 level of DKK 39.7 billion, driven by increases in most income items. This figure is adjusted for the discontinuing operations in Ireland. We expect low demand for loans and thus a slight decrease in lending volumes, with the effect being offset by lower funding costs.
Expenses are expected to be around DKK 23 billion after the transfer of discontinuing operations in Ireland to the Non-core unit.
Impairment charges on our core activities are expected to be broadly in line with the 2013 level of DKK 4.1 billion.
We reaffirm our previously announced expectation for Non-core Ireland impairments and thus estimate impairment charges of up to DKK 2 billion in 2014.
We expect net profit for 2014 in the range of DKK 9-12 billion.
In preparation for the repayment of the state hybrid capital in the first half of 2014, we expect to issue further capital in the form of debt instruments in the
This guidance is generally subject to uncertainty and depends on economic conditions. Our trading income and insurance business income are particularly uncertain. The 2014 results for trading and insurance will depend greatly on developments in the financial markets and the possibility that Danica Pension can book the risk allowance and part of the balance on the shadow account to income.
*Note: Note 38 provides additional information.
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