Good morning, everyone. Welcome to the conference call for Danske Bank's financial results for the first nine months of 2026. My name is Claus Ingar Jensen, and I'm head of Danske Bank's investor relations. With me today, I have our CEO, Carsten Egeriis, and our CFO, Cecile Hillary. We aim to keep this presentation to around 25 minutes, and after the presentation, we will open up for a Q&A session as usual. Afterwards, feel free to contact the investor relations department if you have any more questions. I will now hand you over to Carsten. Slide two, please.

Thanks very much, Claus. Good morning and thank you for joining us for our Q3 conference call, where I'm pleased to share the highlights of Danske Bank's financial results for the first nine months. We delivered a solid third quarter supported by good customer activity and continued execution of our strategy. Core income grew 9% year-on-year alongside disciplined cost management and strong credit quality. Let me start with our customers. The Nordic operating environment remained supportive of commercial activity. Corporate lending grew by more than 5% year-on-year, supporting market share gains across the Nordics. Deposits also remained strong, and within asset management, customers added more than 5 billion of debt inflows during the quarter, with contributions both from private banking and from mass retail. Credit demand, as reflected in volumes, was slightly affected by seasonal effects, while fair value movements in Reikredit Danmark bonds also impacted lending volumes. But against that backdrop, the overall commercial performance remained resilient. This activity translated into solid financial results. Our return on equity for Q3 came in at a record high, 15.1%, and the cost-to-income ratio of 43.9 tracks well within our full-year guidance of below 45%. And credit quality remains strong with net reversals of impairments. We also maintained a strong capital position. Our CET1 capital ratio increased to 17.2%, reflecting strong capital generation after dividend accrual. The confirmed Pillar 2 release reduced regulatory requirements by 40 basis points, in line with previous communication. Given the solid financial performance in Q3, we have also narrowed our net profit guidance for the full year to a range between 24 and 25 billion, driven by an improved outlook for loan impairment charges, which we now expect to be no higher than 600 million. So overall, the quarter shows continued strategic execution supported by resilient customer activity. And despite a seasonally slower quarter, we're confident in our trajectory and the performance of our franchise going forward. Please turn to slide three. Let me turn to the performance of our business units. The key message here is that customer activity remains resilient across group. All three business units delivered income above the level a year ago, and each generated returns above its 2026 target. The broad-based performance gives us confidence in the strength of our franchise and in the progress we're making against our strategic priorities. In personal customers, good activity and deposit margin affects supported income, while continued strong credit quality also contributed to a ROAC of 40%. Total income was just under 5 billion, significantly above the level a year ago. and nominal lending was up 1% year-over-year and stable compared to Q2, while deposits remained strong, growing 4% from last year, which should also be seen in light of the positive net inflow to assets under management. Business customers continued to build momentum, higher customer activity, growing fee income, and progress in our corporate offerings supported both income and volume growth, with ROAC increasing to 23%. Total income reached $3.8 billion, with growth in both lending and deposits reflecting continued strength in business relationships. In large corporates and institutions, we saw continued strength across lending, asset management, financing, and also advisory activities. Our debt capital markets franchise also benefited from constructive bond issuance activity, and ROEC remained strong at 22%. Total income was $4.7 billion, above the level a year ago. Lending was stable quarter on quarter, reflecting seasonal effects, while deposits increased 3%. Relative to the same period last year, lending and deposits were up 5% and 13% respectively. So in summary, across the three businesses, this is a solid and a sustained performance. It reflects our strong customer franchise. It reflects our continued momentum and also our attractive profitability across the group. And then slide four, please, and I'll hand it over to Cecile.

Thank you, Carsten. Looking at the income statements, Q3 was another quarter of solid financial performance with good momentum in our core income lines, continued cost management and strong credit quality. For the first nine months, total income was supported by growth in net interest income and fee income, underpinned by customer activity and higher volumes. Trading income was affected by market volatility, while income from our insurance business has performed well in the context of changing interest rate expectations. Other income normalized after the 231 million one-off in Q2. Compared with Q2, NII grew 3%, primarily driven by deposit margin expansion, and fee income was stable. Both trading and insurance income were affected by volatile market conditions. Costs remain in line with our guidance and reflect our continued focus on efficiency driven by our tech and AI investments. Credit quality continues to be strong with a well-provisioned portfolio and net reversals of impairments in Q3. Overall, the quarter shows resilient earnings quality where NII further benefited from the rate hike. Fee income continues to be strong and costs are under control. I will now go through the key lines in more detail. Slide 5 please. Turning now to net interest income, we delivered a solid performance, with NII up 4% year-on-year, supported by improved volumes and the contribution from our structural hedge. The quarterly development was also positive, with higher rates supporting an improvement in deposit margins. Alongside the positive volume trend, this underpinned the resilience of our net interest income. The other category primarily reflects Treasury's internal fund transfer pricing allocations. Importantly, these allocations have no impact on net interest income at group level. Our structural hedge was impacted by higher short-term rates in Q3, but this was partly countered by higher income from our shareholder equity base, which remains unhedged and benefited from higher central bank rates. The notional of the structural hedge, including bonds and derivatives, was kept stable in Q3 at around 190 billion, and as such, the structural hedge remains a key stabilizing feature of our NII profile. Finally, we have updated our interest rate sensitivity. All else equal, a 25 basis point increase in rates would add approximately 400 million krona to NII in year 1, 350 million in year 2, and 100 million in year 3. A 25 basis points decrease will lead to an impact of around minus 550 million in year 1, minus 250 million in year 2, and minus 100 million in year 3. The revised sensitivity reflects the current balance sheet composition. For example, corporate lending facilities have pushed the NII benefits slightly further out in year 2. Note, however, that the combined upside is the same total of 850 million over 3 years as previously communicated. So in summary, we see the NII trajectory as solid. Customer volumes are contributing positively and with the recent rate hikes, this supports our income trajectory. And finally, to address questions about expectations for NII for the full year, we reaffirm our expectation of NII to be slightly above 38 billion for full year 2026, driven by continued volume growth and based on current market implied rates, which do not include another hike until late in the year. Turning to fee income. This was a solid quarter despite typical Q3 seasonality. For the first nine months, net fee income increased by 14%. Importantly, the growth was broad-based across all four fee categories. Investment fees were the largest contributor, driven by higher asset under management from consistently positive net inflows together with rising asset prices. Everyday banking fees were supported by continued demand for FX and cash management solutions. Lending and guarantee fees were driven by higher customer activity, particularly due to corporate credit demand. Capital markets fees were underpinned by a good performance from our DCM and advisory franchise. Compared with the second quarter, net fee income was broadly stable at 4.1 billion kroner. Lending and guarantee fees declined, mainly due to seasonality, including lower refinancing volumes for adjustable rate mortgages. This was mitigated by investment fee income, which remained a strong driver. Overall, the fee income development demonstrates the breadth of customer activity across our franchise and the benefit of a diversified fee base even in a seasonally slower quarter. Looking towards Q4, we expect the current trend to continue. However, given recent market volatility, we expect Q4 performance fees to be well below the historical average of around 400 million. This development relates to fixed income funds performance given current volatility in fixed income markets. Slide 7 please. Turning to trading income, the result was lower year-over-year and quarter-over-quarter, reflecting both softer customer activity and negative fair value effects in Group Treasury. Net trading income for the first nine months was 1.5 billion krona, down 37% from the same period last year. The main driver was a lower result in LC&I, where customer activity in secondary fixed income markets remained subdued. For the third quarter, net trading income was 397 million kroner. We saw better customer activity in FX trading, but this was more than offset by lower income from fixed income trading in what is also a seasonally slower quarter. The quarter was also affected by unrealized market value adjustments, together with other balance sheet movements in Group Treasury, which created negative accounting effects. These items fluctuate from quarter to quarter and do not reflect a corresponding change in business activity. Finally, as far as Q4 trading income is concerned, if the current market conditions persist, we expect trading income to be in line with Q3, all things equal. In addition, there are typically seasonal effects leading to lower customer activity in trading at the end of the fourth quarter. I will now move on to the expense line. Slide 8 please. Turning to expenses, our cost trajectory remains in line with our full year guidance, with a Q3 cost to income ratio of 43.9%. Year on year, expenses were slightly higher, mainly due to staff costs, including severance and performance-based compensation. This was more than offset by lower FCRP and radiation costs, showing continued progress in reducing legacy cost items and allowing for increased investments in tech and AI in line with our plans. Quarter on quarter, this trend was confirmed and despite higher investment spend, the underlying cost development remains well controlled. We continue to make targeted forward 2018 investments in our digital and technology platform. These investments support AI-enabled growth and overall enhance our efficiency and resilience. Overall, we reaffirm our full-year 2026 cost outlook of 26 to 26.5 billion, with a cost-to-income ratio expected to be below 45%. The message remains centered around increased efficiency and continued investments in strategic priorities. I will now move on to asset quality. Slide 9, please. Turning to asset quality, the picture remains strong. Our diversified and stable credit portfolio continues to perform well whilst we remain prudently provisioned given the macro and geopolitical environments. In Q3, further improvement in credit quality led to a net reversal of 200 million. With a year-to-date level of impairment charges at CZK 65 million, we have revised our full-year impairment guidance from around CZK 1 billion to no more than CZK 600 million, corresponding to approximately three basis points cost of risk. Macroeconomic charges remained modest in the quarter. Our scenarios continue to reflect elevated uncertainty, including geopolitical risks, trade tensions and market volatility, so that we capture the potential impact of a more severe and prolonged adverse environment. Post-model adjustments stood at 5.2 billion with a reallocation of provisions towards agriculture given additional political tail risks. We continue to take a prudent approach in light of potential disruptions and uncertainty. The total overlay of around 30 basis points is equivalent to almost four years of normalized cost of risk. Overall, asset quality continues to support the earnings profile and capital generation of the bank. I will now move on to capital. Slide 10 please. Turning to capital, our position remained strong. Our CET1 ratio increased by 20 basis points during the quarter to 17.2%, driven by retained earnings after the accrual of dividend. Capital generation continued to be strong at 302 basis points annualised. Our total capital ratio increased to 21.3%, further supported by the issuance of a 5 billion krona equivalent AT1 transaction to a broad Nordic investor base in Q3. Risk exposure amounts were broadly stable at 847 billion. Lower credit risk exposure was countered by higher market risk REA that mainly reflected interest rate volatility. Following the formal SHREP review of the resolved legacy cases, our CET1 capital requirement has been reduced by around 40 basis points to 14.3% as previously guided. This means that our management buffer to the regulatory requirements has improved to around 300 basis points. We continue to manage capital prudently. Our capital framework already includes an REA buffer of more than 110 billion kroner to absorb the transition and implementation of our IRB models. That buffer has been recently reviewed in close alignment with our regulator, the Danish FSA. Looking ahead, our CET1 trajectory remains consistent with the glide path to move gradually towards our stated CET1 target of around 16% in 2028. This allows us to finance our growth plan and deliver on our capital distribution agenda. So in summary, the third quarter demonstrated strong capital generation, stable balance sheet management, and continued ability to deliver on both growth and distribution. Slide 11, please. Finally, turning to the financial outlook for 2026, we have narrowed our net profit guidance to a range of 24 to 25 billion, corresponding to a return on equity above 14%. The revised guidance is a result of impairment charges now expected to be no higher than 600 million to reflect the quality of our credit portfolio. We continue to expect total income to be somewhat above 59 billion, supported by higher co-banking income from strong customer activity, growing volumes and the effects of recent policy rate hikes. We continue to see good commercial momentum across our businesses. We expect operating expenses to be in the range of 26 to 26.5 billion. This reflects our focus on growth, tech and AI investment and cost management. We expect our cost to income ratio to be below 45% for full year 2026. Slide 12 please and back to Claus.

Thank you, Cecile. Those were our initial comments and messages. We are now ready for your questions. Please limit yourselves to two questions. And if you are listening to the conference call from our website, you are welcome to ask questions by email. The transcript of this conference call will be added to our website within the next few days. Operator, we are ready for the Q&A session.

Thank you. If you would like to ask a question over the phone lines, you will need to press star 1 and 1 on your telephone and wait for your name to be announced. And to withdraw your question, you can press star 1 and 1 again. Please stand by while we compile the Q&A queue. Thank you. We will now begin with our first question. This is from Gulnara Setkulova from Morgan Stanley. Please go ahead.

Hi, good morning. Thank you for taking my questions. So the first question on capital headwinds and tailwinds. So you recently published a press release reaffirming your capital framework including the 110 billion plus REIA buffer for IRB model implementation. And clearly we've seen some sizeable capital headwinds emerging from model reviews for the Nordic peers. So I wanted to understand how much comfort we should take from your announcement that the existing buffer fully captured the potential impact of all outstanding model reviews, including those that have not yet received the final regulatory approval. And could you provide some more color on which material reviews are still outstanding, the expected timing, and whether there are any additional capital headwinds and tailwinds that investors should consider as we look towards 2028?

Yeah, good morning. Thank you very much. No, I think on the RIA and modeling side, we're very comfortable with our position. We have the buffer that was mentioned, and that buffer, in fact, has been updated regularly over the last few years as we have been updating our model frameworks and applications and in line with regular reviews from the Danish FSA. We continue to work on the various different model applications. Some have been approved and some are still in pipeline, but all of them have been sort of regularly discussed with the regulator. So again, we feel very comfortable with the rear buffer that we have in place today.

thank you and another question on deposit mix shift you've previously highlighted the gradual shift towards high yielding savings products could you elaborate on what's driving that mix shift is it primarily customers optimizing their balances within Danske Bank or are you seeing increasing competitive pressure on deposit pricing and looking ahead in Q4 and beginning of 2027 How should we think about the pace of that migration and the implications for deposit bidders, particularly across the personal customers, business customers and LC&I? Thank you.

Thank you for your question, Gunnara. Actually, let me clarify things on the deposit side. I mean, the first thing to say is that we continue to see good growth on our deposit stock. Obviously, we guided in April towards a growth of 1 to 2% on the deposit side. We've seen deposits actually stronger, right? I mean, year on year, actually, we've seen more around the sort of 7%. So the first thing to mention is obviously the strength that we see in our deposit development. The second thing to say is that clearly we have benefited from the rate hike. Clearly in Q3 the June hike is fully embedded and obviously in Q4 the September hike will also play a part in NII development. The deposit beta that we have seen so far has been lower than our expectations. Now, of course, over time, especially if we've got more rate hikes, December, et cetera, things might obviously evolve. But so far, it's been lower. But that is captured in our NII sensitivity. Then to address the deposit mix shift, We actually don't see currently evidence of mix shift appearing in any material way. As a matter of fact, and you'll see that in our fact book, the time deposits that we have as a proportion to our deposits remains fairly low, including in our personal customer So of course it could change, of course it could evolve, but right now we're not seeing any evidence of any material shift and certainly we're not seeing any impact in our numbers either.

Thank you.

Thank you. We'll now take our next question. This is from Shrey Srivastava from Citi. Please go ahead.

Hi, and thank you very much for taking my questions. Two please from me. The first is on the fee prints. I know that despite the substantially stronger fee print today, you have not upgraded your guidance on core banking income, and I assume that means you haven't upgraded your guidance on fees. Can you explain why that is? Can you break down the components of the fee, which you expect to occur, which you expect not to? The second question is on the negative in this quarter from short-term rates in the structural hedge. In connection with the move from bonds to swaps, have you altered the sort of duration characteristics of the replicating portfolio at all? When can we expect to see sort of positive quarter-on-quarter development here with the interest rate assumptions from your economists?

Thank you. Thanks very much. Let me take the fee question, and then I'll let Cecile talk around the bonds to swaps and the associated duration dynamics. On the fee print, as you say, we printed a solid Q3 fee print, both quarter and quarter, given typical seasonality in Q3, but also certainly year on year. and we see good momentum in all fee lines. The Q4 specific question when we talk about how we think about the fee line in Q4 is that in general, you should see it as we continue to see momentum in all the core fee lines, general banking, investment fees, financing fees. However, what we also note is that there is a fee component that we have, which is related to our fixed income hedge funds. Thank you very much. The average is somewhere between 400 to 500 if we look at the last many years. And given how fixed income has moved in the last few months, we expect the current fees associated with that particular asset class to be well below the average. So that is the dynamic. But you should think about that all other fee lines and the core trajectory and momentum we feel very comfortable with.

I'll take the second question on the structural hedge. So the shift from bond to swaps is gradual. So we still hold a majority of bonds in our structural hedge portfolio in any case. But it doesn't change the duration of the structural hedge, which remains around three years. We also have a loan hedge which also remains around two years. The notional doesn't change either for the bond and derivative hedge which is at 190 billion. And again, what I would say is that it's a significant lift I will remind you as well that clearly the structural hedge impact is fully baked into the NIH sensitivity that we give you.

Thank you. And so the negative on the structural hedge quarter to do with the swap component?

Well, this year, no, I wouldn't focus on it. I mean, you know, on a quarterly basis, given the various maturities and when they roll off, it can be slightly positive or slightly negative. But you shouldn't focus on that. I mean, overall, for the year, it remains a strong positive.

Thank you very much.

Thank you. We will now take the next question. This is from Namita Samtani from Barclays. Please go ahead.

Morning and thank you for taking my questions. My first one, just to follow up on the structural hedge, can I just confirm it's going to be a neutral impact in 2027 and 2028? and then secondly it looks like on personal lending dance was growing below the market and it looks like total personal lending was flattish quarter on quarter so I just wondered whether it's an active decision to not engage in competition which could impact margins or any color here would be great thank you

Thanks, Navida. On the lending question, you know, if you adjust for the fair value impacts related to the Real Kredit Denmark bonds, we see a slight growth quarter on quarter in RD lending and also slight growth on the on the bank lending side. And so we're fully focused on competing in the mortgage space and see relative good momentum. If we also look at it over the last couple of years, relative good momentum in that space, but clearly we're also very cognizant of where we want to play and where we want to compete. and to your point, and you also see that in margins, we're maintaining margins in that space despite the very heavy competition. So it's an important product for our customers. We continue to focus on delivering a strong value proposition, including on the mortgage side. And again, we do see growth in both the mortgage lending products.

Do you want to comment on the structural hedge? Yes, I'll take the structural hedge. So the way we look at structural hedge, and not all banks present it in the same way, but the way we look at the structural hedge income is as a net impact. And in terms of the net impact, It was positive this year. It still is positive this year in the current rate environment. But given market implied rates, it will be negative next year and the year after. But again, this is fully baked into NII sensitivity. Clearly, we are geared to higher rates. And obviously, we see positive impact net-net from deposit margins impacts as well as structural hedge combined. and equity, shareholder equity investments as well. On a combined basis, clearly, we remain positively geared to rates. But to answer specifically your question on the structural hedge, Namita, this is indeed going to be a negative contribution next year and the year after.

That's helpful. Thanks very much.

Thank you. We'll now take the next question. This is from Sophie Pettersson from Goldman Sachs. Please go ahead.

Yeah, hi, here is Sophie from Goldman. Thanks a lot for taking my question. So my first question would be around your costs. So you had already a 44% cost to income ratio in the first nine months of this year. You upgraded the cost to income ratio target for 2026. How should we think about the upside risk to your 2028 cost income target of below 43%? And yeah, if you could just talk about that. And then my second question would be like, how should we think about excess capital deployment, given that we saw 40 basis points decline in your requirements, you have more excess capital like What's the priority for you after growth? Is it share buybacks or special dividends or M&A? And if it's M&A, what could potentially be of interest? Thank you.

Thank you. Let me start with the capital question and then I'll let Cecile comment on the upside risk to cost versus 28 plan. On the capital side, as part of our strategy refresh in Q1, we gave Thank you very much. The priority for us is to grow organically. We have a plan with a 3-4% growth rate on the lending side of things. We continue to execute on that plan. We also, as part of the plans earlier this year, updated our dividend policy to 60-70%. Thank you very much.

And let me take, Sophie, your question on the cost-to-income ratio and trajectory towards 2028. And in summary, this trajectory is exactly as planned. So we are confident with delivering the cost-to-income ratio in 2028 of up to and no greater than 43%. So that still very much holds. We continue to see a good trajectory when it comes to general cost management but also the AI investments that we are doing right now and the benefits that we are seeing already in 2026. The one that we're expecting in 2027 and therefore the linear trajectory to the 2 billion run rates in terms of benefits from these AI investments by 2028. We see them progressing and materializing in time. So in summary, we are confident about our cost to income ratio trajectory towards 2028 and the guidance we gave.

Thank you.

Thank you. Next question today is from Andreas Haakonsson from Nordea. Please go ahead.

Thank you and good morning, everyone. Cecile, I heard you said that the trading in Q4 is going to be more similar to Q3, and I was just looking at consensus that's looking for probably over 900 million for the fourth quarter. So if you have that lower trading and Your NI sensitivity is a little bit lower, what is it, 50 million lower per 25 bps, and we're at two hikes. And on Shrey's question, it didn't sound like you wanted committed to higher fees in the fourth quarter. So what's really driving the upgraded guidance apart from loan loss? Is it anything else or actually being a bit softer on revenues?

No, look, we continue to see very good development in core banking income. Just to be a bit more precise on the fee income line, Carsten mentioned, I will reiterate, that we actually see very good momentum across all four categories of the fee income lines, right? Investment fees, obviously daily banking activities, As well as financing fees and capital markets. And we expect these in Q4, all things being equal, we expect that fee income coming from these four categories should be higher than Q3. This is our expectation. This is what we are seeing in terms of the commercial momentum. The performance fees is a separate topic. The performance fees is obviously linked to the fixed income funds and the fixed income funds performance and there currently we expect an amount which is again well below the average which is around 400 million compared to last year. However, we still see again that the co-banking lines together, so NII and and Fi Income will drive total income. Insurance income is developing well, well in line with our expectations. And trading income, of course, I need to reiterate, will depend on the development in markets in Q4. If it stays the same, it will be as we've guided. If it improves, clearly it could be better.

Okay, then a second question. Looking at Swedish retail, and maybe it's for Carsten, and when we track the monthly data in Sweden and you haven't really seen any loan growth in Swedish retail for a long time, it's normally shrinking, but a couple of years ago you said that you want to steer the Swedish retail bank more towards mass affluent and so on. So is that shrinkage in Is it planned or how successful are you to move over to more wealthier clients?

No, thanks very much for that. Of course, we would always like to see more growth, but it is absolutely right. You've understood it right that our strategy has been and continues to be to reposition the Swedish business towards a more mass affluent private banking focus. Thank you for joining us. Today, what we're seeing is that we are increasing the inflow in number of customers in our chosen and focus segments. We also see growth in, for instance, the investment and managed funds side of things. And that is exactly what we're trying to do is to increase the share wallet and the profitability. Okay, thank you. Thank you.

We'll now take the next question. This is from Martin Gregersberg from SEB. Please go ahead.

Thank you so much. Two questions. The first one on NII. If I strip out the 92 million one-off base effect from last quarter, strip out the FX effect and also the day effect, I guess, underlying NII, it's only up by 80 million Q1, Q2, and Q3. So could you please help me walk through sort of your own NII assumptions for the coming two, three quarters? Since, I don't know, I sit back with the feeling that it's perhaps a little bit slower out of the starting blocks than I had expected. And then last question also on NII or loan growth, I guess. And I guess this is just a follow up to one of the past questions. If you take your Danish personal customers' loan growth, And if you adjust for the fair value adjustments, your current growth rate is close to a third of what the market is currently growing. What are sort of the priorities here? I guess you're 90, sorry, you're 39% return on allocated capital. You can't grow new lending on that return ratio. So is this going to be, are you happy with it and then happy with a A pure margin business if I can put it on a needle.

Yeah, thanks a lot, Martin, for the questions. Look, first of all, on NII, we feel very good about the NII momentum and the trajectory. And if I look at the last couple of years, I think actually we've been in our own internal views and guidance that we've been given. Thank you for joining us today. You know, underlying NII. So, you know, rather than maybe, you know, small one offs quarter to quarter here and there. Again, I look back at the several many last quarters and we felt very comfortable and good about both the guidance and the actual delivery and NII and, you know, we're guiding to NII. A slightly above 38, we continue to feel good about that given the trajectory. You see the bridge in the presentation. I think the NII continues to be robust when you look quarter on quarter, driven both by volumes and margins. And there again, I think important to look at it, not just quarter on quarter, but also year on year. On the loan growth question, this is, of course, specific again to PC Denmark. It is true that we're not growing as fast as the market in the mortgage space. But it is also true that we're really focused on building a strong value proposition, particularly focused on the mass affluent and private banking space. There, of course, Some of the key metrics to look at is the fact that we're taking market share on the investment side and we're number one in Denmark on the investment side and also see really good momentum there. That we've seen strong growth on the deposit side at the same time. Thank you for joining us today. Lending is of course an important product and as I mentioned earlier in the call we of course compete on that and we price selectively in our chosen market segments but it is just one product as a part of a much broader franchise where as you will know the large income and profitability drivers are All right, thanks. And then maybe just a last question. I guess the lesson for 2026 has been that loan growth on group level, it doesn't really cost you anything in terms of the risk exposure amount.

You are now cruising into a headroom of close to 300 pips and even with a 100% payout ratio over the coming year. How do you see that trajectory heading down to 16%?

You should see it as we previously guided on 3-4% lending growth. We continue to feel good about that forecast. You should see the real dynamics moving up. Of course, it's always depending on mix and on asset quality and so forth. But you should see that as moving in a way that it sort of supports that we'll get to the 16% CET1 in 2028. I think it's very difficult to comment because RIA is a mix of, again, customer dynamics, asset quality, customer mix. As you'll know, a lot of the growth has been driven the last couple of years by LCNI. We spoke about that in the speech, 13% year-on-year growth. typically investment grade, lower RIA, relative consuming business, just to give one example. So it really depends on the dynamics, but you should see the RIA growth moving somewhat in line with lending growth. Do you want to comment, Cecile, on any one of these?

I'll just comment briefly indeed on the capital trajectory. I mean, it is true, obviously, that we have a large buffer of 300 basis points, larger than the management buffer of 150 to 200 basis points that we've guided towards, whilst I would say that the regulatory Capital risk or headwinds, et cetera, is reducing. We've actually seen the batterization of reduction of PLO2, et cetera. If anything, we've got what I feel is a very good level of clarity towards 2028 when it comes to capital. Just to let you know that the 300 basis points management buffer in part is covering for some of our 81 deficit which is of course deliberate. We don't want to have outstanding extra capital if we can avoid it. So some of this 300 basis points covers 81 and the glide path remains the same towards the 16% 2028 target. Whilst we expect, as Carsten was mentioning, it will allow us to maintain our capital distribution policy alongside our growth objectives.

All right, thanks. Thank you. And the next question today comes from Ricardo Rovere from Mediobanca. Please go ahead.

Thanks. Thanks a lot for taking my question. Just one. When I look at your financial statements, your balance sheet, and I sum up all the various assets that should generate credit risk, so loans to banks, loans to customers, loans As for value and investment securities held to maturity or through other comprehensive income, the balance sheet, if the numbers are in front of me are kind of correct, is up almost 70 billion Danish kroner. And the credit risk RWA under IRB standardized and counterparty risk is down 4 billion and a quarter. Can you elaborate how this can be possible? Is there a rate in migration? PMAs are unchanged, so it looks like the risk profile you see in general hasn't changed. How can it be? Thanks.

Yes, absolutely. Ricardo, thank you for the question. I would say a good observation, particularly in a short timeframe since we released our results this morning. So our data and system, the main sort of evolution, because obviously we have indeed increased the credit exposure whilst you see in fact a stabilization of REA, which includes in fact a reduction of credit risk REA with a slight increase of market risk REA which is obviously due to the current market. So why do we see this credit risk REA reduction? This is because our data and systems become better over time with investments that we're doing in our digital capabilities that allows us to be more precise and more accurate in calculating these REAs. and that explains, you know, the last few months in particular explains why we've seen this reduction. Clearly, I mean, taking a step back, the quality of our portfolio obviously supports that.

Sorry, Cecile, is it a matter of better allocating the collaterals?

Better calculations, more accurate data, allowing us to effectively remove some buffers linked to uncertainty in calculations. That's how I would call it. Yeah.

Okay. All right. Okay. Thanks.

Thank you. We'll now take our next question. And this is from Alexander Vilstrup-Jorgensen from DMB Carnegie. Please go ahead.

Yeah, good morning and thank you for taking my questions as well. I have two. So first, on competition within your various segments, how do you see the competition in the sector, both within PC, BC and LC&I? Should we expect pressure on lending margins from here or do you see pricing discipline improving? That would be my first question.

Thanks for that. Look, I think I would describe competition as being strong and intense competition. In fact, as has been the case, I think, from the last many years. My observation is not that there is anything specific to call out that's changed. In Q3 or even the last few quarters, I think the pricing discipline is relatively robust in the sense that there is a focus also from our competition and in general in the market Thank you very much. Nothing particularly new to report, continues to be intense, but also I think continues to be relatively disciplined.

Okay, thank you. Moving over to my second question, it relates to your Northern Irish business. Would you ever consider divesting your Northern Irish business over time? I can see that in your 2028 strategy, you outline ambitions for PC, BC and LC&I across the Nordic markets, but you provide little detail on the Northern Irish business. So given that the business appears somewhat outside your broader Nordic strategic focus, how do you see its role in the group going forward?

Yeah, look, I mean, we really like our Northern Irish business. It's a very strong business, strong profitability, very well diversified, very long deposits and a strong team there. It is a business that sits on our one platform and has all the benefits of sitting on our one platform. And that's an important consideration. Look, I've also said before that it is, of course, not part of our core Nordic strategy. And therefore, we'll ongoing, of course, look at whether there is or could be a better owner of that business, but we like the business and we continue to invest in it. Very clear. Thank you.

Thank you. We will now take the next question. This is from Isabel Hetrick from Bernstein Autonomous. Please go ahead.

Hi there, it's Isabel from Autonomous Research. Thanks for taking my questions. So my questions actually focus on your announcement last week that you're enabling your business customers to connect their AI agents to your platform and access their banking data. So my first question is, what drove this development? Was it client interest? And do you have plans to roll it out to the retail customers? And then my second question is, more broadly, what risks do you see from customers using AI agents regarding deposit stickiness, brand loyalty? And do you have any plans to mitigate potential impacts here? Thank you.

Yeah, no, thanks for that. And obviously, this is a hot topic to say the least. And developments are just going so fast on the MCP side. Yes, it is something that our customers demand. And, you know, again, Thank you very much. Make their own user interfaces and tools using that data for treasury management, cash management purposes and so forth. And we of course want to enable that for our customers. We don't immediately have plans on the personal customer side, but I could easily see that that is where the market is going as well. Obviously there are premium APIs, APIs available, but in terms of consumer customers building their own user interfaces, having access to their data, to some extent they could do that already, but doing it with agentic tools you could also imagine could be something that will happen. And certainly we're very much looking at at both risks and opportunities in terms of how sort of intermediation and disintermediation from agented capabilities will play out. And we're investing very heavily in the space and we'll continue to look at both how we can support our customers and continue, of course, to build competitive advantage and strengthen our value proposition to our customers.

Thank you. Thank you. And we have one more question. The last question today is from Harry Sivakumaran from KBW. Please go ahead.

Hi there. Can I ask a question on Danica? We've had a couple of good quarters. I'm just wondering how much of that is kind of operational improvement and how much that may be kind of volatility driven? and then also on 4Q costs. Just the four year guidance implies a bit of a range. So just maybe some colour on where it may end up in 4Q. Thanks.

Yeah, on Dainica, it is very much driven by ongoing improvements in the health and accident area, which has previously been a significant challenge for the whole sector and also for us. We've significantly improved our operational capabilities around the management, both proactively and reactively on the Thank you very much. and then maybe on the cost guidance.

Yes, on the cost guidance. So indeed, we've given a guidance of between 26, 26 and a half billion for the year with a cost to income ratio below 45 percent. I'm not going to refine the guidance further, but I'll say two things. One, our cost management This plan is going exactly as we anticipated at the beginning of the year. So there is nothing that we feel is out of our forecast. That's the first thing I would say. And secondly, of course, we have in mind our trajectory towards the cost to income ratio of up to and no greater than 43% in 2028. And we intend to be firmly Going in that direction. But beyond that, I'm not going to make any other comments.

All right. Thank you very much, everyone, for your interest in Danske Bank. We really appreciate it. Thanks for your questions. As always, please do reach out to Investor Relations if any other questions. Thanks a lot. Take care.