By Ole Mikkelsen
COPENHAGEN (Reuters) - Danske Bank (CO:DANSKE), said it expects to write down around 9 billion Danish crowns (£957.7 million) of the value of its businesses in Finland, Northern Ireland and Estonia.
Denmark's largest bank by market capitalisation has had to cut staff and branches to recover from the financial crisis, when it was hit hard by its exposure to Ireland and weakness in Finland, which has been weighed down by Europe's standoff with Russia.
"It is a recognition of they have purchased something too expensive and my assessment is that it must primarily be the acquisition in Finland," said analyst Ricky Steen Rasmussen from Nykredit Markets referring to Danske Bank's takeover of Sampo Bank for 30.1 billion Danish crowns.
The writedown follows a stress-test by the Danish Financial Services Authority conducted alongside the European-wide checks.
Shareholders' equity will be reduced by the same amount. At Sep 30 shareholders' equity and total goodwill was 158.7 billion and 18.6 billion crowns respectively.
"The goodwill impairments are of a purely technical nature and do not affect our strategy or business. The impairments also will not affect our regulatory capital or liquidity," Danske Chief Financial Officer Henrik Ramlau-Hansen said in a statement.
Danske's 2014 annual report will be published on Feb 3.
The bank confirmed its guidance for a 2014 full-year net profit of between 11.5 billion and 13.5 billion crowns excluding the write down.
The goodwill impairment will not affect Danske Bank's plan to pay a dividend of 40 percent of net profit for the year, it said.
By 0840 GMT shares in Danske Bank were down 1.9 percent while the STOXX Europe banking index <.SX7P> were up 0,05 percent.
(Additional reporting by Teis Jensen; editing by Jason Neely and Louise Heavens)