Jyske Bank A/s · OMXCOP:JYSK
Jyske Bank A/s — Q1 2022 Earnings Presentation
34 slides from Jyske Bank A/s's earnings presentation, May 3, 2022
Slide 1: Investor presentation Q1 2022
Investor presentation Q1 2022 3 May 2022
Slide 2: Summary
Summary Q1 2022 Summary 02 Financials 12 Volumes 19 Sustainability 23 Jyske Bank in brief 26 Macroeconomics 28 Calendar and contacts 32
Slide 3: Financial results: Strong start to the year
Financial results: Strong start to the year Net profit of DKK 851m and return on equity of 9.3% p.a. in Q1 2022 Income statement and key figures (DKKm) Net interest income +7% y/y from deposit repricing, higher interest income Q1'22 Q1'21 Index Q4'21 Index from excess liquidity and accelerating corp
Slide 4: Highlights: Strong start to the year and upgraded outlook
Highlights: Strong start to the year and upgraded outlook Bank lending growth accelerated further, growing 9% q/q and 17% y/y in Q1 2022 Net fee and commission income continues to show strong momentum, reaching record-high level Cost discipline successfully supplementing income growth; cost/income r
Slide 5: Outlook
Outlook Earnings per share (DKK) Bank lending and nominal mortgage lending Volumes to increase in 2022 2022E 2021 Lower in 2022 than 2021 due to value Core income adjustments 2020 2019 Core expenses Lower in 2022 than 2021 excl. one-off items 2018 2017 Loan impairment Reversals of loan impairment ch
Slide 6: Bank lending grew 9% q/q and 17% y/y in Q1 2022
Bank lending grew 9% q/q and 17% y/y in Q1 2022 Significantly improved momentum, gaining corporate lending market share Bank lending (excl. repo, mortgage-like lending, DKKbn) 110 105 100 95 90 85 80 2016 2017 2018 2019 2020 2021 Q1'22 Bank lending (excl. repo, mortgage-like lending) 6
Slide 7: Net fee and commission income showing strong momentum
Net fee and commission income showing strong momentum Historically high level of net fee and commission income in Q1 2022 Net fee and commission income (trailing four quarters, DKKm) 2,600 2,400 2,200 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 0 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'
Slide 8: Cost discipline successfully supplementing income growth
Cost discipline successfully supplementing income growth Improving cost/income ratio has reached level below 55% Cost/income ratio (excl. one-off items) 70% 65% 60% 55% 50% 45% 40% 2015 2016 2017 2018 2019 2020 Q2'21-Q1'22 Cost/income ratio (excl. one-off items) 8
Slide 9: Limited direct exposure to Russian invasion of Ukraine
Limited direct exposure to Russian invasion of Ukraine Jyske Bank is focused on helping clients mitigate implications from the war Jyske Bank’s direct credit, fund and treasury exposure is limited. Direct exposure Significant mgmt. est. related to war in Ukraine and elevated macroeconomic risk. Only
Slide 10: Upcoming regulation fully financed, leaving excess capital
Upcoming regulation fully financed, leaving excess capital Expected CET1 ratio effect from upcoming regulation reduced to 1.5pp Common equity tier 1 ratio and requirement 20% CET1 ratio target: 18% 15%-17% 16% 14% EBA guidelines Impact from fully implemented upcoming regulation 12% in Q3’21-Q1’22 re
Slide 11: Book value per share accretion of 9% p.a. since 2015
Book value per share accretion of 9% p.a. since 2015 Number of shares in circulation reduced by 6% in the last two quarters Book value per share (DKK) 600 500 400 300 200 100 0 2015 2016 2017 2018 2019 2020 Q1'22 Book value per share 11
Slide 12: Financials
Financials Q1 2022 Summary 02 Financials 12 Volumes 19 Sustainability 23 Jyske Bank in brief 26 Macroeconomics 28 Calendar and contacts 32
Slide 13: Continued positive trend in net interest income
Continued positive trend in net interest income Net interest income (NII) Net interest income Q1 2021 vs. Q1 2022 (DKKm) 1,340 NII +7% y/y, mainly caused by higher volumes and reduced deposit rates +7% y/y 1,320 • Significantly higher lending volumes offset by mix effects, primarily due to lower hou
Slide 14: Fee income remained strong and grew to a record high level
Fee income remained strong and grew to a record high level Net fee and commission income (NFCI) Net fee and commission income Q1 2021 vs. Q1 2022 (DKKm) 750 NFCI +19% y/y amid high activity levels and increasing business volumes +19% y/y • Securities trading and safe-custody underpinned by 12% highe
Slide 15: Challenging start to the year in financial markets
Challenging start to the year in financial markets Value adjustments and investment portfolio earnings Value adjustments (DKKm) Value adjustments of DKK 9m in Q1 2022 400 -353m y/y • Widening of option-adjusted spreads of Danish mortgage bonds as well 300 as negative equity performance. 200 • Higher
Slide 16: Costs slightly reduced amid stable underlying development
Costs slightly reduced amid stable underlying development Core expenses Core expenses Q1 2021 vs. Q1 2022 (DKKm) 1,200 Core expenses -1% y/y due lower number of FTEs and decreased IT costs -1% y/y 1,190 • Lower IT expenses related to a capital markets programme, which ended in 2021. 1,180 • Number o
Slide 17: Reversals despite Russian invasion of Ukraine
Reversals despite Russian invasion of Ukraine Credit quality Cost of risk (bp) Loan impairment charges of DKK -55m, -1bp cost of risk, in Q1 2022 8 -1bp y/y Part of COVID-19 mgmt. • Continued reversals in Q1 2022, primarily caused by a lower 6 est. individualised in Q1’21 management’s estimate follo
Slide 18: REA inflation partly offset by reduced capital requirement
REA inflation partly offset by reduced capital requirement Capital position and capital distribution Capital ratios and capital requirements Capital ratio of 21.6% and CET1 ratio of 17.2% at the end of Q1 2022 26% Target capital ratio: 20%-22% -2pp y/y 24% Target CET1 ratio: 15%-17% • CET1 ratio dec
Slide 19: Volumes
Volumes Q1 2022 Summary 02 Financials 12 Volumes 19 Sustainability 23 Jyske Bank in brief 26 Macroeconomics 28 Calendar and contacts 32
Slide 20: Very strong corporate bank lending momentum
Very strong corporate bank lending momentum Business volumes Lending volumes (excl. repo) Leasing Bank loans +9% q/q (+17% y/y) due to strong corporate lending growth 5% Corporate • Significantly higher lending to particularly large corporate clients more bank loans than offset the effect from lower
Slide 21: Lending portfolio
Lending portfolio Loans, advances and guarantees by sector (DKKbn) Significant de-risking of mortgage portfolio LTV in recent years Personal clients 40% 100% 61% 90% 59% 59% Real property 32% Finance and insurance 9% 80% 57% 57% Other sectors 4% 70% 55% Public authorities 2% Personal clients 40%, 60
Slide 22: 75% mortgage lending share improves resilience and growth
75% mortgage lending share improves resilience and growth Mortgage lending is low risk, high growth, more stable margins The Danish mortgage model The Danish mortgage model Provides highly attractive, transparent lending terms at a very low cost of risk by issuing covered bonds with 1:1 matching ter
Slide 23: Sustainability
Sustainability Sustainable business and responsible banking operations Summary 02 Financials 12 Volumes 19 Sustainability 23 Jyske Bank in brief 26 Macroeconomics 28 Calendar and contacts 32
Slide 24: Sustainable business
Sustainable business Supporting sustainable transition • Identifying five sustainable lending areas with the largest potential of reducing carbon emissions. • Developing sustainability-linked products (e.g. green mortgages, energy retrofitting loans, CO2 calculator). • Providing advice that challeng
Slide 25: Responsible banking operations
Responsible banking operations Sustainable banking operations Target for offsetting CO2 emissions from electricity consumption, district heating and company cars by own renewable energy production virtually met. Roof solar panels to be installed at headquarter in 2022. Replacement of company cars by
Slide 26: Jyske Bank in brief
Jyske Bank in brief Summary 02 Financials 12 Volumes 19 Sustainability 23 Jyske Bank in brief 26 Macroeconomics 28 Calendar and contacts 32
Slide 27: One of the largest financial institutions in Denmark
One of the largest financial institutions in Denmark Nationwide presence Nationwide operations Founded in 1967 and now holds approx. 11% market share in AAA-rated economy in sound AAA economy with strong nationwide presence following organic growth and succesful M&A. Complementary, full- Offering a
Slide 28: Macroeconomics
Macroeconomics Summary 02 Financials 12 Volumes 19 Sustainability 23 Jyske Bank in brief 26 Macroeconomics 28 Calendar and contacts 32
Slide 29: Macroeconomics
Macroeconomics Real gross domestic product (2010=100) Inflation rate (HICP, y/y) 130 8% 125 7% 6% 120 5% 115 4% 110 3% 105 2% 1% 100 0% 95 -1% 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
Slide 30: 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 2004 2005 2006 2007 2008 2009 2010 2011 2012
Slide 31: Danish economy forecast
Forecast Financial results and key figures DKKbn Real growth (%) Danish economy 2021 2019 2020 2021 2022 2023 Consumer spending 1,131 1.2 -1.3 3.5 1.7 1.6 Public spending 612 1.5 -1.7 4.3 -1.2 -0.6 Fixed gross investment 553 0.1 5.1 4.1 2.5 3.2 Inventory investment* 23 -0.2 -0.1 0.2 0.0 0.0 Exports
Slide 32: Financial calendar and contacts
Financial calendar and contacts Financial calendar 2022 22 Feb. 2022 Announcement of the 2021 results 22 Feb. 2022 Annual report 22 Feb. 2022 Risk Management Report 2021 22 Mar. 2022 Annual General Meeting 03 May. 2022 Interim report for the first quarter of 2022 16 Aug. 2022 Interim report for the
Slide 33: 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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