As you know, the Danish Contingency Association and the government have already promised to cover all losses on lending to banks. A capital injection would reduce such losses and would thus serve as damage control. On top of the financial crisis, we were hit by severe currency unrest in October – the first such incident for more than 10 years.
The unrest was not due to factors in the real economy and shows that when a global financial crisis occurs, a price must be paid for not adopting the euro. The currency unrest led to a considerable outflow of capital in a very short time, resulting in falling foreign-exchange reserve and a significant widening of the yield spread to the euro area.