Danske Drops Individual Analyst Calls After Confusion Last Year

(Bloomberg) --

Danske Bank A/S will no longer offer pre-earnings calls to individual analysts after such one-on-one talks last year left some investors confused and triggered a sudden sell-off of its stock.

Instead, Danske will hold a joint call on Jan. 10, marking a first for Denmark’s biggest bank. The event, which appears on Danske’s calendar, will be open to all analysts, giving them a chance to ask questions before a silent period kicks in. Danske is due to report full-year results on Feb. 5.

Robin Lofgren, a senior investor-relations officer at the Copenhagen-based bank, confirmed the decision to replace individual analyst conversations with a group call, when contacted by phone on Monday.

“It’s mostly to make sure that all analysts receive the information at the same time,” Lofgren said. “It’s not stock-sensitive information, but we wanted to get around the issue of having a long period of time between the first and the last analyst on the list.”

One-on-one calls are routinely done by listed companies keen to prevent market expectations from straying too far from reality. Investor-relations departments use such conversations to remind analysts of seasonal factors, one-offs, market trends and indexes in order to help steer estimates.

But such calls don’t always bring about the desired result. In June, Danske suffered a sudden market sell-off after analysts interpreted its guidance differently, and investors started to wonder what to believe. Analysts subsequently cut their forecasts for Danske’s profit lines. In early July, Danske issued a profit warning.

Shares in Danske Bank fell 47% in 2018, and 16% last year. The bank is being investigated across Europe and in the U.S. after admitting that a large part of about 200 billion euros ($224 billion) in non-resident flows through its Estonian unit were suspicious.

To contact the reporter on this story: Christian Wienberg in Copenhagen at cwienberg@bloomberg.net

To contact the editor responsible for this story: Tasneem Hanfi Brögger at tbrogger@bloomberg.net

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