Danske Bank, Denmark's largest financial institution, said impairments at its Irish bank would remain high next year as Government austerity measures hurt demand.
Danske, which bought National Irish Bank in 2004, also said in a presentation on its website today that austerity in Ireland would intensify cash-flow pressure in the commercial property market, although it was unlikely the economy would tip back into recession.
Austerity measures and difficulties in the Irish banking sector were also likely to dampen supply and credit demand in the residential property market, it said.
Restructuring at NIB was now complete, but the full impact of cost reductions would not be visible until 2011, the bank said.
In a recent interview Danske's chief executive Peter Straarup said the bank was changing its strategy in Ireland, pulling back from high street banking to focus on wealthy and corporate clients.
Reuters
