Nordic Credit Rating (NCR) said today that it had revised its outlook on the Danish banking sector to stable from negative, while affirming its 'bbb+' assessment of the industry.
In our last review of the sector earlier this year, we revised our assessment score down by one notch to its current level (see National banking market assessment Denmark, published 17 Jun. 2020), mainly to reflect the initial impact of COVID-19 on the sector.
The stable outlook reflects our expectations of a flatter U-shaped recovery rather than the sharp V- or, in the worst case, W-shaped rebound that we anticipated previously. In our view, countries and markets are better prepared for any renewed upsurge in COVID-19, while localised outbreaks should prove easier to manage than national shutdowns. In August, the Danish government revised GDP projections for 2020 and 2021 upwards and announced a budget that includes DKK 9bn in COVID-19 related stimulus in 2021, allowing for continued support for the most vulnerable sectors and individuals.
If you have any questions, please contact:
Geir Kristiansen, credit rating analyst, +4790784593, geir.kristiansen@nordiccreditrating.com
Sean Cotten, chief rating officer, +46735600337, sean.cotten@nordiccreditrating.com