Critical Contrast: Danske Bank (OTCMKTS:DNKEY) versus ICICI Bank (NYSE:IBN)

ICICI Bank (NYSE:IBN) and Danske Bank (OTCMKTS:DNKEY) are both large-cap finance companies, but which is the superior business? We will contrast the two businesses based on the strength of their institutional ownership, earnings, analyst recommendations, valuation, dividends, risk and profitability.

Profitability

This table compares ICICI Bank and Danske Bank’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
ICICI Bank	24.91%	14.91%	1.89%
Danske Bank	40.42%	13.01%	0.61%

Insider & Institutional Ownership

18.2% of ICICI Bank shares are owned by institutional investors. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.

Analyst Ratings

This is a summary of recent ratings and recommmendations for ICICI Bank and Danske Bank, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
ICICI Bank	0	1	0	0	2.00
Danske Bank	0	1	4	0	2.80

Dividends

ICICI Bank pays an annual dividend of $0.21 per share and has a dividend yield of 0.7%. Danske Bank pays an annual dividend of $0.75 per share and has a dividend yield of 3.0%. ICICI Bank pays out 13.0% of its earnings in the form of a dividend. Danske Bank pays out 37.1% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Earnings and Valuation

This table compares ICICI Bank and Danske Bank”s gross revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
ICICI Bank	$22.68 billion	4.76	$6.02 billion	$1.62	18.65
Danske Bank	$8.18 billion	5.12	$3.43 billion	$2.02	12.43

ICICI Bank has higher revenue and earnings than Danske Bank. Danske Bank is trading at a lower price-to-earnings ratio than ICICI Bank, indicating that it is currently the more affordable of the two stocks.

Risk and Volatility

ICICI Bank has a beta of 0.42, indicating that its share price is 58% less volatile than the S&P 500. Comparatively, Danske Bank has a beta of 0.61, indicating that its share price is 39% less volatile than the S&P 500.

About ICICI Bank

ICICI Bank Limited provides various banking products and services in India and internationally. It operates through Retail Banking, Wholesale Banking, Treasury, Other Banking, Life Insurance, and Others segments. The company offers savings, salary, pension, current, and other accounts; and time, fixed, recurring, and security deposits services. It also provides home, car, two-wheeler, personal, gold, and commercial business loans, as well as loans against securities and other loans; business loans, including working capital finance, term loans, collateral free loans, loans without financials, finance for importers and exporters, and overdraft facilities, as well as loans for new entities and card swipes; and credit, debit, prepaid, travel, forex, and corporate cards. In addition, the company offers pockets wallet; fixed income products; investment products, such as mutual funds, gold monetization schemes, initial public offerings, and other online investment services; and agri and rural business, farmer finance, tractor loans, and micro banking services, as well as other services to agri corporates. Further, it provides portfolio management, trade, foreign exchange, locker, private and NRI banking, and cash management services; family wealth and demat accounts; commercial and investment banking, capital market, custodial, and institutional banking services; health, personal accident, fire, and motor insurance, as well as distributes general and life insurance products; and Internet, mobile, and phone banking services. Additionally, the company offers securities investment, broking, trading, and underwriting services; and merchant banking, trusteeship, housing finance, pension fund management, asset management, investment advisory, points of presence, and private equity/venture capital fund management services. ICICI Bank Limited was founded in 1955 and is headquartered in Mumbai, India.

About Danske Bank

Danske Bank A/S provides various banking products and services to corporate, institutional, and international clients. The company offers insurance and pension products, mortgage finance and real-estate brokerage services, asset management and trading services in fixed income products, foreign exchange services, and equities. It also provides advisory services to personal and private banking customers; and business advisory services, including acquisition, change of ownership, strategic development, or international expansion. In addition, the company offers financing, risk management, investment, and financial advisory services for large corporates and institutions; healthcare solutions; and online and mobile banking services. It has operations in Denmark, Finland, Sweden, Norway, the United Kingdom, and internationally. The company was founded in 1871 and is headquartered in Copenhagen, Denmark.