Danske Bank has reported a smaller than expected pre-tax loss, reflecting higher income from its insurance business and fee income from increased customer activity.
The Danish bank said it expected net profit of more than 14 billion crowns in 2015.
Its fourth-quarter pre-tax loss of 5.3 billion Danish crowns came after a 9 billion crown writedown announced in December. Analysts had on average expected a pretax loss of 5.07 billion crowns.
The combination of an improved top line, lower costs and lower loan impairments resulted in a net profit before goodwill impairments of 12.9 billion crowns, its best result since 2007.
Danske Bank said its Irish losses before tax fell to €201m last year, down from €241m the previous year, as loan impairments fell by 29%.
The bank continued its retrenchment in the Irish market in 2014, making what it called "considerable headway" with the winding-up of its non-core Irish operations.
The bank said that after the first half of this year only the personal mortgage portfolio will remain on its books in Ireland.
Terry Browne, Country Manager and Head of Corporate & Institutional Banking at Danske Bank Ireland, said that in the past 18 months, the bank has successfully refocused its business here.
He said it is now concentrating its efforts on leveraging its technology and advisory expertise to deliver a superior service to corporate and institutional clients.
"Our continued focus on our corporate and institutions business reflects the wider Danske Bank Group's proven ability to deliver differentiated solutions for clients in this segment," Mr Browne stated.
"We have delivered a strong performance in corporates & institutional banking in Ireland in 2014 and are well positioned to support our clients in the growth of their business both at home and abroad, " he added.
Meanwhile, Denmark's largest bank by stock market value said it would pay a dividend of 5.5 crowns per share, higher than the 5.33 crowns per share expected by analysts. It also said it would launch a 5 billion crown share buy-back programme.
Danske said the macroeconomic environment did not offer much support, as the year was affected by a continuation of low interest rate levels and slow growth.
"Despite this, we managed to increase the top line across our business," the bank's chief executive Thomas Borgen said.
The bank revised long-term targets for return on equity to above 12.5% by 2018 from 12%. The target for 2015 was lifted to 9.5% from 9%.
It also revised its longer-term ambition to make dividend payments of about 40% of net profit. It said it would strive to pay ordinary dividends of between 40-50% of net profit.
