Jyske Bank A/s · OMXCOP:JYSK
Jyske Bank A/s — Q1 2023 Earnings Presentation
35 slides from Jyske Bank A/s's earnings presentation, May 2, 2023
Slide 1: Investor presentation Q1 2023
Investor presentation Q1 2023 2 May 2023
Slide 2: Summary
Summary Q1 2023 Summary 02 Financials 13 Volumes 20 Sustainability 24 Jyske Bank in brief 27 Macroeconomics 29 Calendar and contacts 33
Slide 3: Upgrading the outlook for a record-setting 2023
Highlights Upgrading the outlook for a record-setting 2023 Upgraded outlook for 2023 Handelsbanken DK acquisition Strong income momentum DKK 65-75 Progressing according to plan +70% y/y Earnings per share in 2023E Handelsbanken Denmark integration Net interest income Increase of 17-35% vs. all-time
Slide 4: Continued strong financial performance in Q1 2023
Financial highlights Continued strong financial performance in Q1 2023 Q1 2023 in brief 170 Business volumes (index) Earnings per share (DKK) 23.6 160 Assets under management Mortgage loans (nominal) 150 19.5 Leasing 140 Bank loans (excl. repo, mortgage-like) Deposits (excl. repo) 130 12.1 12.4 11.6
Slide 5: A second upgrade of earnings expectations for 2023
Financial highlights A second upgrade of earnings expectations for 2023 Earnings per share (DKK) 65-75 55.4 42.4 35.1 34.7 33.5 28.2 29.0 25.4 26.1 19.8 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023E 5
Slide 6: Net interest income up 70% y/y from higher rates and SHB DK
Financial highlights Net interest income up 70% y/y from higher rates and SHB DK Net interest income (DKKm) 2,224 1,773 1,412 1,359 1,277 1,312 1,224 1,230 1,242 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Note: Handelsbanken Denmark (SHB DK) contributed from 1 Dec. 2022. 6
Slide 7: Manageable underlying cost inflation amid inflationary trends
Financial highlights Manageable underlying cost inflation amid inflationary trends Core expenses (DKKm) 1,518 1,388 1,395 1,273 1,171 1,171 1,174 1,160 1,195 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Underlying core expenses SHB DK One-off items Note: Core expenses include one-off expens
Slide 8: Macroeconomic risks reflected in post-model adjustments
Financial highlights Macroeconomic risks reflected in post-model adjustments Post-model adjustments excl. adjustments related to Handelsbanken Denmark (DKKm) 2,000 1,770 1,800 1,656 1,630 1,655 1,640 1,609 1,569 1,607 1,602 1,600 1,417 1,425 1,425 1,400 1,272 1,200 1,000 800 589 600 400 200 0 Q4'19
Slide 9: Liquidity position remains very solid
Financial highlights Liquidity position remains very solid Deposits (excl. repo/triparty, DKKbn) and liquidity metrics 220 Demand deposits, etc. Time/term deposits +7% q/q 200 Deposits 180 160 +8pp q/q Time/term deposit share 140 120 174% 100 Liquidity coverage ratio 80 60 137% 40 Net stable funding
Slide 10: Rebuilding capital position following acquisition
Financial highlights Rebuilding capital position following acquisition Common equity tier 1 ratio (target range: 15%-17%) 18.3% 18.2% 18.6% 18.0% 18.0% 17.9% 17.2% 15.2% 15.4% Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Note: The acquisition of Handelsbanken Denmark caused a CET1 ratio dec
Slide 11: Integration progressing according to plan
Acquisition of Handelsbanken Denmark Integration progressing according to plan Transition to be finalised in 2023 Overview of financial impact Branch number to be reduced by c. 25% c. DKK 1bn p.a. 115 Normalised pre-tax profit by 2025E Locations June -5% in Q1’23 Public announcement Run-rate of c. D
Slide 12: Targeting another EPS record for 2023
Outlook Targeting another EPS record for 2023 Earnings per share (DKK) Significantly higher in 2023 than in 2022 Core income Mainly due to Handelsbanken Denmark 0 10 20 30 40 50 60 70 80 acquisition and a higher level of interest rates 2023E 2022 Significantly higher in 2023 than in 2022 Core expens
Slide 13: Financials
Financials Q1 2023 Summary 02 Financials 13 Volumes 20 Sustainability 24 Jyske Bank in brief 27 Macroeconomics 29 Calendar and contacts 33
Slide 14: Net interest income up 70% y/y
Financials Net interest income up 70% y/y Net interest income (DKKm) Q1 2023 net interest income (NII) benefitted from the acquisition of 2,224 Handelsbanken Denmark and a higher level of interest rates. 1,773 +70% y/y • Handelsbanken Denmark (SHB DK) 1,412 Net interest income 1,277 1,312 1,359 cont
Slide 15: Activity-driven fee income decreased from high level
Financials Activity-driven fee income decreased from high level Net fee and commission income (DKKm) Net fee and commission income decreased from an all-time high level that was supported by high activity levels as 683 681 645 658 well as a one-off. 598 576 578 567 509 • Securities trading and safe-
Slide 16: Continued strong trading performance in Q1 2023
Financials Continued strong trading performance in Q1 2023 Value adjustments and investment portfolio earnings (DKKm) 523 362 9 243 207 240 128 DKK +240m Value adjustments Positive effect from -93 OAS tightening • Value adjustments of DKK 240m: Continued strong client-driven trading -300 performance
Slide 17: Manageable underlying cost inflation following acquisition
Financials Manageable underlying cost inflation following acquisition Core expenses (DKKm) DKK 165m DKKone-off 165m 1,518 1,388 one-off 1,395 1,273 1,171 1,171 1,174 1,195 Core expenses rose 3% y/y adjusted for 1,160 one-off items and the inclusion of SHB DK. The underlying increase was mainly cause
Slide 18: Credit quality remains solid
Financials Credit quality remains solid Cost of risk and net exposure by IFRS 9 stages (bp/DKKbn) Increased overall provisioning for macreconomic risks in Q1. The stage 3 share continued to decline and the level of 2 write-offs remained at a very low level. 0 DKK 96m (2bp) • Higher bankruptcies in D
Slide 19: Rebuilding capital position following acquisition
Capital and liquidity Rebuilding capital position following acquisition Common equity tier 1 ratio and risk exposure amount (%/DKKbn) • 15.4% CET1 ratio is within 15%-17% target range following the acquisition of Handelsbanken Denmark in Q4 2022. 15.2% 15.4% • Targeting recommencement of capital 15.
Slide 20: Volumes
Volumes Q1 2023 Summary 02 Financials 13 Volumes 20 Sustainability 24 Jyske Bank in brief 27 Macroeconomics 29 Calendar and contacts 33
Slide 21: Continued deposit market share gain in Q1 2023
Business volumes Continued deposit market share gain in Q1 2023 Business volumes (index / DKKbn) 170 Business volumes (index) DKK 202bn 160 0% q/q • Mortgage loans (nominal): Close to 150 DKK 110bn Mortgage loans (nom.) unchanged q/q, as higher corporate 140 +8% y/y lending was offset by lower priva
Slide 22: Lending characterised by high mortgage share with low LTV
Lending volumes Lending characterised by high mortgage share with low LTV Split of lending volumes (excl. repo) Mortgage lending with low loan-to-value Leasing 100% 5% 90% Corporate bank loans 80% Private 21% mortgages 70% 35% 60% 57% 50% 52% 50% 44% 46% Private 40% bank loans Mortgage-like 2% 73% 3
Slide 23: High mortgage lending share underpins stability and growth
Main exposure: The Danish mortgage market High mortgage lending share underpins stability and growth The Danish mortgage model Balance principle limits funding risks High and resilient growth of mortgages Balance sheet of Jyske Bank 3,500 Based on a balance principle with no +4.5% p.a. 3,000 default
Slide 24: Sustainability
Sustainability Sustainable business and responsible banking operations Summary 02 Financials 13 Volumes 20 Sustainability 24 Jyske Bank in brief 27 Macroeconomics 29 Calendar and contacts 33
Slide 25: Approach and ambitions
Sustainability Approach and ambitions Ingrained in identity Focus on financed emissions Share of CO2 emissions 0.03% Scope 1 Company cars, local heating 0.08% Scope 2 “We run a sustainable and responsible business” Electricity, district heating First statement in Jyske Bank’s Identity Supporting a w
Slide 26: Targeting net zero emissions by 2050
Sustainability Targeting net zero emissions by 2050 Lending Investments Own operations 1.3 million tonnes CO2 0.6 million tonnes CO2 0.02 million tonnes CO2 Emissions in 2022 Emissions in 2022 Emissions in 2022 -22% vs. 2019 -42% vs. 2019 -19% vs. 2020 Targets for emission intensity reduction Target
Slide 27: Jyske Bank in brief
Jyske Bank In brief Summary 02 Financials 13 Volumes 20 Sustainability 24 Jyske Bank in brief 27 Macroeconomics 29 Calendar and contacts 33
Slide 28: One of the largest financial institutions in Denmark
Jyske Bank in brief One of the largest financial institutions in Denmark Founded in 1967, now a Danish SIFI Focused on structural, low-risk growth Leading presence in AAA economy DKKbn 344 115 1967 Founded by merger of four banks in Silkeborg Locations c. 12% 3,878 FTEs 1989 Seven acquisitions in 19
Slide 29: Macroeconomics
Macroeconomics Summary 02 Financials 13 Volumes 20 Sustainability 24 Jyske Bank in brief 27 Macroeconomics 29 Calendar and contacts 33
Slide 30: Macroeconomics
Macroeconomics Real gross domestic product (2010=100) Inflation rate (HICP, y/y) 130 12% 125 10% 120 8% 115 6% 110 4% 105 2% 100 95 0% 90 -2% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 201
Slide 31: Macroeconomics
Macroeconomics Real estate prices, Denmark (y/y) House prices to disposable income (2015=100) 30% 140 25% 20% 130 15% 120 10% 5% 110 0% -5% 100 -10% -15% 90 -20% 80 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2004 2005 2006 2007 2008 2009 2010 2011
Slide 32: Forecast
Macroeconomics Forecast DKKbn Real growth (%) Danish economy 2022 2020 2021 2022 2023E 2024E Consumer spending 1,195 -1.4 4.1 -2.5 -1.2 0.3 Public spending 620 -1.4 4.2 -2.8 1.0 1.0 Fixed gross investment 651 5.1 6.2 8.4 -4.6 -1.3 Inventory investment* 37 -0.2 0.0 0.9 -0.4 0.0 Exports 1,923 -6.3 8.0
Slide 33: Financial calendar 2023
Financial calendar 2023 28 Feb. Announcement of the 2022 results 28 Feb. Annual report 2022 28 Feb. Risk Management Report 2022 30 Mar. Annual General Meeting 02 May. Interim report for the first quarter of 2023 15 Aug. Interim report for the first half of 2023 31 Oct. Interim report for the first n
Slide 34: Disclaimer
Disclaimer This presentation and the information contained therein is furnished and has been prepared solely for information purposes by Jyske Bank A/S. It is furnished for your private information with the express understanding, which recipient acknowledges, that it is not an offer, recommendation
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