Sydbank forecasts lower 2025 profit as interest rates fall

Danish lender Sydbank on Wednesday reported a solid first-half profit but forecast a lower full-year result for 2025 as falling interest rates begin to weigh on earnings.

The bank posted a profit of 1.21 billion Danish Kroner for the first six months of 2025, with a return on equity of 16.7% after tax.

Sydbank said its net interest income declined as anticipated due to lower rates, but the drop was partly offset by a 7% increase in other core income driven by higher customer activity.

"Despite the decline in net interest income, which was expected, the higher level of activity along with the increase in other core income has helped us to ensure that core income remains satisfactory and demonstrates that our core business is in a strong position," CEO Mark Luscombe said in a statement.

For the full year 2025, the company expects a profit after tax between 2.2 billion and 2.6 billion Danish Kroner.

This compares with its most recent forecast for 2024 of between 2.8 billion and 3.1 billion Danish Kroner.

The company also reported that costs rose in the first half, primarily due to the acquisition of Coop Bank and collectively agreed pay increases.

Sydbank is continuing a 1.35 billion Danish Kroner share buyback program, having repurchased 490 million Danish Kroner worth of shares in the first half of the year, the company said.