Danske Bank Outlook Cut to ‘Negative’ at Fitch on Danish Economy

Danske Bank A/S, Denmark’s biggest lender, had its outlook lowered at Fitch Ratings, which cited weakness in the Irish and Danish economies.

Fitch cut the outlook on Danske’s long-term issuer default rating to “negative” from “stable” while keeping the Copenhagen- based bank at “A+," it said today in a statement.

“The negative outlook reflects some uncertainty in the development of the Danish and Irish economies,” Andrew Shenton, an associate director at Fitch in London, said in the statement. “The ratings are likely to be downgraded if Fitch anticipates the bank’s earnings capacity to materially suffer from continued asset quality erosion, particularly in Denmark and the Republic of Ireland.”

Denmark’s economy slipped into recession in the first quarter, joining bailout-reliant Portugal as the only other European nation to suffer more than a quarter of contraction. The decline was led by a drop in consumer spending as the property market stagnates and the government plans budget cuts.

For more: Danske Bank Outlook Cut to ‘Negative’ at Fitch on Danish Economy - Bloomberg