BANK of Greenland’s Investment Portfolio and Risk Exposure Revealed in 2022 Report

Introduction

The BANK of Greenland has published its 2022 Risk Report, offering a glimpse into the institution’s investment portfolio and risk exposure.

Investment Portfolio

According to the report, the bank holds shares in several sector companies, totaling TDKK 117,783. These shares are not included in the bank’s trading portfolio and are held outside of it, as participation in these sector companies is deemed necessary for operating a local bank.

• The shares are essential for the bank’s business operations.
• In some cases, the bank’s shares in sector companies are redistributed based on the credit institution’s volume of business with each company.
• The carrying value of these assets is adjusted quarterly, semi-annually, or annually, depending on new information from each sector company.

Interest Rate Risk Exposure

The report also reveals that the bank has an interest rate risk exposure in positions outside its trading portfolio totaling TDKK 1,842. This exposure includes fixed-rate assets such as loans and deposits.

Gearing Risk

In terms of gearing risk, the bank’s leverage ratio is calculated daily and must not be lower than 10%. The bank assesses excessive leverage occurs when the leverage ratio falls below this threshold.

• The bank’s total assets stood at TDKK 7,949,566 as of December 31, 2022.
• After adjusting for various items, the bank’s total leverage ratio exposure was calculated at TDKK 9,883,691.

Conclusion

The report provides a comprehensive overview of the bank’s investment portfolio and risk exposure, providing stakeholders with valuable insights into its financial health.