Interim financial report, Q1-Q3 2022

  • Earnings per share, excluding exceptional costs related to the acquisition of Handelsbanken Denmark: 33.1 DKK (31.5 DKK).
  • Core earnings before impairment charges and value adjustments increased by 31% to DKK 2,859 million (DKK 2,176 million).
  • Capital ratio: 23.6% (22.6%), of which Common Equity Tier 1 capital ratio of 18.6% (18.0%).
  • The purchase of the Danish activities of Svenska Handelsbanken has been approved by the Danish Competition and Consumer Authority and is progressing as planned. The transaction should be finalized before the end of the year.
  • Under the agreement, Jyske Bank will make on the acquisition date a cash payment for the assets and liabilities of Handelsbanken Denmark as well as a payment for goodwill in the amount of DKK 3.0 billion.
  • The synergies are expected to amount to at least DKK 0.3 billion per year before tax and to be fully realized within 2024. Restructuring and integration costs are expected to be c. DKK 0.5 billion before tax, of which approx. DKK 0.1 billion in 2022 and c. DKK 0.3 in 2023.
  • Due to the capital position, it is expected that the transaction will not require any issuance of AT1 shares or capital.


“Jyske Bank’s earnings per share increased in the first nine months of 2022 and thus defied a significant negative turn from DKK 0.8 billion to -0.5 billion in valuation adjustments and portfolio income from investment Basic profit before write-downs and value adjustments increased by 31% The significant fluctuations in the financial markets reflect growing uncertainty about macroeconomic developments due to the acceleration of inflation, to which the war in Ukraine added oil.

Inflationary pressure has led to historically rapid increases in interest rates and thus the end of the period of negative interest rates. A period of stagflation in the form of negative growth and continued inflation is likely imminent, although the depth and duration of the economic downturn is still unknown. We strive to help our customers through times of uncertainty. In addition, Jyske Bank will help reduce dependence on energy supplies from Russia by reducing its own energy consumption by 15%.

Denmark’s economic situation is good and Jyske Bank’s activity continues to grow, supported by an increase in business volume and a good level of activity. Added to this is the impact of tight cost control and continued strong credit quality. The acquisition of Svenska Handelsbanken’s activities in Denmark has been approved by the competition authorities, and we look forward to welcoming customers and collaborators in the months to come.says Anders Dam, CEO and Managing Director.

The Danish economy was still characterized by an increase in employment in the first nine months of 2022, but the strong economic growth after the end of the restrictions imposed due to the COVID-19 pandemic in 2021 has however weakened . Capacity pressures in global supply chains have contributed to an imbalance between supply and demand, leading to accelerating inflation. Inflation reached a 40-year high and resulted in historically high increases in interest rates to the detriment of household purchasing power and a new low in consumer confidence. This increased the likelihood of an economic slowdown and lower house prices. However, the Danish economy is well positioned to handle a period of weaker growth, and Jyske Bank is focused on helping its customers manage their financial problems.

On June 20, 2022, Jyske Bank entered into an agreement to acquire the activities of Svenska Handelsbanken in Denmark, comprising approximately 600 employees and 43 branches and headquartered in Copenhagen. The Danish operations were established in 1992 and have since experienced organic growth complemented by the acquisitions of Midtbank and Lokalbanken. Based on the level at the end of 2021, the transaction includes more than 130,000 customers, bank loans and advances of DKK 66 billion and deposits of DKK 36 billion. Under the agreement, Jyske Bank will make on the acquisition date a cash payment for assets and liabilities in addition to a payment for goodwill in the amount of DKK 3.0 billion. The acquisition will strengthen Jyske Bank’s position in the market and its business volume will increase by approximately one-fifth. The larger scale will also support opportunities to develop and offer attractive products and services to current and future Jyske Bank customers. The acquisition will also provide the opportunity to achieve economies of scale based on a common IT platform. The transaction is expected to be completed before the end of 2022 following approval by the Danish Competition and Consumer Authority in October.

Jyske Bank is well positioned for organic growth and the integration of Svenska Handelsbanken’s activities in Denmark. Over the past decade, Jyske Bank has optimized its business through significant revenue and cost initiatives, new strategic cooperation agreements, as well as organizational adjustments. Several acquisitions have been integrated, of which the merger with BRFkredit in 2014 being the most important.

In the first nine months of 2022, the business area achieved a strong increase in business volume. The personal client area has implemented new branch mergers and, with effect from 1 April 2022, a new client programme. The objective of this program is to ensure that, in a cost-effective manner, Jyske Bank will always be able to offer its retail clients accessible, personalized and competent advice as well as quality and prompt service. These characteristics also apply to Jyske Bank’s private banking activities, and for the seventh consecutive year, Jyske Bank has been voted the best bank for private banking customers in Denmark according to Voxmeter.

In the first nine months of 2022, the expansion of easy and digital access to Jyske Bank services continued in the form of, among other things, self-service ordering of additional loans and an overview Jyske Forsikring (insurance) in Jyske Mobilbank. The period also saw the launch of extensive training activities for sustainability advisors as well as the integration of ESG preferences into the investment advice offered. Additionally, Jyske Bank has joined the Green Building Council Denmark, which strives to promote sustainability in construction among all stakeholders. Jyske Bank had Net Zero Asset Managers Initiative approved milestones as part of the requirement to have net CO clients’ investment portfolios2 neutral by 2050. In addition, Jyske Bank has installed solar panels at its head office, which will help reduce net electricity consumption in the future.

Earnings per share of DKK 31.9 in Q1-Q3 2022
Earnings per share increased from DKK 31.5 to DKK 31.9, which includes an amount of DKK 78 million incurred for one-time expenses related to the acquisition of Handelsbanken Denmark. Net profit for the period at DKK 2,194 million corresponded to a return on equity of 7.9% pa compared to DKK 2,391 million and 8.8% pa, respectively, for the first nine months of 2021. The still strong profit defied a DKK 1.3 billion turn on valuation adjustments and income from the investment portfolio. The result therefore reflects a good underlying development with an increase in business volume, a high level of activity and good credit quality.

Overall, Jyske Bank’s business volume grew in the first nine months of 2022. Banking business loans and advances experienced one of the highest growth rates to date of 22% compared to the first nine months of 2021. The increase can be attributed to corporate clients. Automotive leasing and financing achieved an 8% increase despite difficult supply chains in the automotive industry. Nominal mortgages increased 1% on higher business lending while retail mortgages declined, in part as customers with fixed rate loans took the opportunity to reduce their outstanding amounts . Bank deposits increased by 22% thanks to business customers.

Adjusted for a negative evolution of value adjustments, basic income recorded a general increase of 13%. Net interest income was supported by higher bank loans and advances to businesses as well as higher interest rates. Net fee and commission income increased, among other things, due to a high level of lending and remortgage activity as well as a new client program for individuals. Other income was favorably affected by, among other things, higher dividends, and continued favorable selling conditions in the used car market led to an increase in operating rental income (net).

Base expenses increased by 1% compared to Q1-Q3 2021. In addition, exceptional expenses of DKK 78 million related to the acquisition of Svenska Handelsbanken’s activities in Denmark were recognized. Underlying cost inflation was reduced by lower spending at Bankdata.

Loan impairment charges amounted to income of DKK 447 million compared to income of DKK 73 million in the first nine months of 2021. Credit quality is still strong with a low level of non-performing loans. Due to macroeconomic uncertainty, Jyske Bank maintains significant management estimates for impairment charges totaling DKK 1,640 million. This level is roughly unchanged from previous quarters.

At the end of the first nine months of 2022, Jyske Bank’s Common Equity Tier 1 capital ratio was calculated at a historically high level of 18.6%, corresponding to an excess capital adequacy of 13.8 billion of DKK in relation to regulatory requirements.

Outlook 2022
For 2022, Jyske Bank expects earnings per share in the high range of DKK 44-50 and net profit in the high range of DKK 3.0-3.4 billion. Ranges exclude expected one-time expenses of DKK 0.1 billion, corresponding to earnings per share of just over DKK 1.

For 2022, business volume is expected to be impacted by increased bank lending as well as increased nominal corporate mortgages.

Basic income could fall in 2022 due to much lower value adjustments than in 2021.

Core spending excluding one-time spending is expected to be roughly unchanged in 2022 compared to 2021.

Loan impairment charges and warranty provisions are expected to be income in 2022.

Yours faithfully,
Bank Jyske

Anders Dam, Managing Director and CEO, tel. +45 89 89 20 01
Birger Krøgh Nielsen, Chief Financial Officer, tel. +45 89 89 64 44


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