Jyske Bank (JYSK) ABG banking trip 2022 presentation summary

2022 outlook

• GDP growth of 3.2% expected amid continued high consumer spending; unemployment expected to fall, inflation to rise and house prices to increase at a slower pace.

• Potential for higher short-term rates from changing policy rates, with Denmark potentially an exception; postponed tax and VAT repayments expected to have limited effect.

• COVID-19 buffer and favorable used-car sales conditions could normalize in 2022; savings products, including pensions, expected to keep growing significantly.

• Growth priorities include repricing, capital markets, sustainability, financial solutions for large corporate clients and stronger sustainability advisory and product offerings.

Repricing and fee growth

• Private and corporate deposit rates were lowered further in Q4; fully implemented initiatives are expected to lift ROE by >2pp p.a. vs. Q2 2019.

• 2021 fee changes lifted the sustainable fee-income run rate by >DKK 0.1bn p.a.; net fee and commission income was shown at DKK 2,244m, with +4% YoY noted.

• New customer pricing from 1 April 2022 adds a DKK 480 p.a. platform access fee for Jyske Hverdag; Jyske Plus and Jyske Premium have no platform fee.

• The pricing program also sets annual VISA/Dankort fees at DKK 350 for Jyske Hverdag and Jyske Plus, and DKK 0 for Jyske Premium.

Efficiency and credit quality

• Full-time employee count was reduced by 27% since the BRFkredit merger.

• Loan impairment estimates remained intact and were DKK 1bn higher than at end-2019; write-offs and NPL levels were described as very low.