Jyske Bank A/s · OMXCOP:JYSK
Jyske Bank A/s — Q4 2021 Earnings Presentation
32 slides from Jyske Bank A/s's earnings presentation, Feb 22, 2022
Slide 1: Investor presentation Q4 2021
Investor presentation Q4 2021 22 February 2022
Slide 2: Summary
Summary Q4 2021 Summary 02 Financials 11 Volumes 18 Sustainability 22 Jyske Bank in brief 25 Macroeconomics 27 Calendar and contacts 31
Slide 3: Financial results: Continued solid performance in Q4 2021
Financial results: Continued solid performance in Q4 2021 Net profit of DKK 785m and return on equity of 9% p.a. in Q4 2021 Income statement and key figures (DKKm) Net interest income +7% y/y from deposit repricing and higher interest Q4'21 Q4'20 Index Q3'21 Index 2021 2020 Index income from excess
Slide 4: Highlights: Strong momentum going into 2022
Highlights: Strong momentum going into 2022 All-time high earnings per share of DKK 42 in 2021 – DKK 40-46 expected for 2022. Bank lending momentum improving; continued growth in savings products, incl. pensions. Benefitting from material changes to fee structure as well as reduced deposit rates. St
Slide 5: Outlook: Highest EPS in history expected for 2022
Outlook: Highest EPS in history expected for 2022 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
Slide 6: Highest bank lending growth in more than a decade
Highest bank lending growth in more than a decade Corporate bank lending growth accelerated further in Q4 2021 Bank lending growth (excl. repo, mortgage-like lending) 10% 8% 6% 4% 2% 0% -2% -4% -6% -8% -10% -12% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Bank lending (excl. repo, mortgag
Slide 7: Material repricing initiatives to gain further momentum
Material repricing initiatives to gain further momentum Smaller customers to pay platform access fee from 1 April 2022 Interest income from deposits (DKKm) 180 160 140 120 100 80 60 40 20 0 -20 -40 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Interest income from deposits (excl.
Slide 8: Cost discipline successfully supplementing income growth
Cost discipline successfully supplementing income growth Improving cost/income ratio has reached level well below 60% Cost/income ratio 70% 65% 60% 55% 50% 45% 40% 2015 2016 2017 2018 2019 2020 2021 Cost/income ratio 8
Slide 9: Management’s estimate up DKK +1.2bn in two years
Management’s estimate up DKK +1.2bn in two years DKK +0.5bn in Q2-Q4 amid reversals; very low level of write-offs and NPL Loan impairment charges based on management’s estimates (DKKm) 1,800 1,600 Part of COVID-19 mgmt. est. 1,400 individualised in Q1’21 1,200 1,000 800 600 400 200 0 Q4'19 Q1'20 Q2'
Slide 10: Sustainability targets
Sustainability targets Targets for reduction of CO2 footprint introduced Sustainability targets We will finance 5 TWh of renewable energy by 2025. 3.2 TWh We will finance low-energy commercial property for DKK 50bn by 2025. DKK 39bn 40% of loans for vehicles (goods transport 20%) will be for low- em
Slide 11: Financials
Financials Q4 2021 Summary 02 Financials 11 Volumes 18 Sustainability 22 Jyske Bank in brief 25 Macroeconomics 27 Calendar and contacts 31
Slide 12: Net interest income up amid accelerating volume growth
Net interest income up amid accelerating volume growth Net interest income (NII) Net interest income Q4 2020 vs. Q4 2021 (DKKm) 1,300 NII +7% y/y, mainly caused by lowered deposit rates +7% y/y • Negative lending mix effects, primarily due to lower household lending, 1,280 and margin pressure more t
Slide 13: Asset management income showing strong momentum
Asset management income showing strong momentum Net fee and commission income (NFCI) Net fee and commission income Q4 2020 vs. Q4 2021 (DKKm) 750 NFCI +11% y/y, mainly due to higher AuM and fee changes +11% y/y • Assets under management increased 19% y/y and income was further 700 supported by a pos
Slide 14: Higher value adjustments supported by spread tightening
Higher value adjustments supported by spread tightening Value adjustments and investment portfolio earnings Value adjustments (DKKm) Value adjustments of DKK 207m in Q4 2021 400 -71m y/y • Continued high activity levels amid volatile financial markets. 300 • Tightening of option-adjusted spreads of
Slide 15: Costs impacted by one-off amid continued FTE reduction
Costs impacted by one-off amid continued FTE reduction Core expenses Core expenses Q4 2020 vs. Q4 2021 (DKKm) 1,450 Core expenses +18% y/y due to one-off item and higher IT costs +18% y/y • Negative one-off of DKK 165m in Q4 2021 from recognising activated IT 1,400 costs related to a finalized capit
Slide 16: Reversals despite significantly increased mgmt. estimate
Reversals despite significantly increased mgmt. estimate Credit quality Cost of risk (bp) Loan impairment charges of DKK -145m, -3bp cost of risk, in Q4 2021 25 -3bp y/y • DKK 228m of reversals in Q2-Q4, despite increasing management’s 20 20 estimate by DKK 498m. Write-offs remained at low level in
Slide 17: Strong capital position amid reduced funding costs
Strong capital position amid reduced funding costs Capital position and capital distribution Capital ratios and capital requirements Capital ratio of 22.8% and CET1 ratio of 18.2% 26% Target capital ratio: 20%-22% 0pp y/y 24% • CET1 ratio increased +0.2pp q/q. Targeting 15%-17%. Target CET1 ratio: 1
Slide 18: Volumes
Volumes Q4 2021 Summary 02 Financials 11 Volumes 18 Sustainability 22 Jyske Bank in brief 25 Macroeconomics 27 Calendar and contacts 31
Slide 19: Improving corporate bank lending momentum
Improving corporate bank lending momentum Business volumes Lending volumes (excl. repo) Leasing Bank loans +7% y/y and +7% q/q amid accelerating corporate lending Corporate 5% • Significantly higher and accelerating lending to corporate clients more bank loans 14% than offset the effect from lower l
Slide 20: Lending portfolio
Lending portfolio Loans, advances and guarantees by sector (DKKbn) Significant de-risking of mortgage portfolio LTV in recent years Personal clients 41% 100% 64% Real property 33% 90% 62% Finance and insurance 9% 80% 60% 60% Other sectors 4% 70% 58% Public authorities 3% 57% Personal clients 41%, 60
Slide 21: 77% mortgage lending share improves resilience and growth
77% 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 22: Sustainability
Sustainability Sustainable business and responsible banking operations Summary 02 Financials 11 Volumes 18 Sustainability 22 Jyske Bank in brief 25 Macroeconomics 27 Calendar and contacts 31
Slide 23: 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 24: 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 25: Jyske Bank in brief
Jyske Bank in brief Summary 02 Financials 11 Volumes 18 Sustainability 22 Jyske Bank in brief 25 Macroeconomics 27 Calendar and contacts 31
Slide 26: 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 27: Macroeconomics
Macroeconomics Summary 02 Financials 11 Volumes 18 Sustainability 22 Jyske Bank in brief 25 Macroeconomics 27 Calendar and contacts 31
Slide 28: Macroeconomics
Macroeconomics Real gross domestic product (2010=100) Inflation rate (HICP, y/y) 125 6% 120 5% 115 4% 110 3% 105 2% 100 1% 95 0% 90 -1% 2006 2006 2015 2004 2005 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2004 2005 2007 2008 2009 2010 2011 2012 2013 2014 2016 2017 2018
Slide 29: Macroeconomics
Macroeconomics Real estate prices, Denmark (y/y) House prices to disposable income (2015=100) 20% 140 15% 130 10% 5% 120 0% -5% 110 -10% 100 -15% -20% 90 -25% 80 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2017 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 201
Slide 30: Forecast
Forecast Financial results and key figures DKKbn Real growth (%) Danish economy 2020 2019 2020 2021 2022 2023 Consumer spending 1,071 1.2 -1.3 4.3 5.0 2.1 Public spending 574 1.5 -1.7 3.4 -1.3 -0.2 Fixed gross investment 521 0.1 5.1 6.1 3.3 1.4 Inventory investment* 13 -0.2 -0.1 0.1 0.0 0.0 Exports
Slide 31: 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 32: 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