Jyske Bank (JYSK) ABG mortgage seminar 2021 presentation summary

Financial performance and lending

• 9M 2021 pretax profit DKK 905m, net profit DKK 711m and annualized return on equity 4.7%; no Covid-related deterioration in credit quality.

• 9M contribution income remained stable YoY; costs rose 12% due to higher intra-group settlement costs, while loan impairment charges were low in Q2 and Q3 2021.

• FY 2021 profit expected at DKK 1.2bn–1.4bn.

• Nominal mortgage lending increased DKK 4.0bn in 9M 2021; total lending had grown more than 65% since the 2014 merger, mainly driven by residential property lending.

Danish mortgage market and credit conditions

• Danish mortgage market described as healthy, supported by a strong economy, high savings, low borrower indebtedness, low credit risk, low LTVs and well-capitalized lenders.

• Jan–Oct 2021 property prices rose 9.8% for houses, 8.4% for apartments and 13.8% for holiday homes; market activity was easing toward more normal levels.

• Covid-19 had not negatively affected the Danish property market; arrears remained low, unemployment had not risen, and exposure to heavily affected sectors was limited.

• Current S&P AAA overcollateralization requirement was at its lowest level; applying the 2012 requirement would imply DKK 26bn of additional overcollateralization.

• Solid buffers covered current capital and liquidity requirements; the final EU Basel IV proposal implied temporarily lower risk weights than earlier proposals, though implementation remained uncertain.

Sustainable finance and transparency

• Sustainable lending targets through 2025 include financing an additional 2.5 TWh of renewable generation and increasing lending to green buildings by DKK 10bn.

• Sustainable Transparency Template reports energy efficiency, CO2 emissions and lending aligned with UN Sustainable Development Goals; 26.8% of Capital Centre E lending supported listed SDGs.

• Q3 2021 ECBC template showed sustainable mortgage loans at 26.7% of the mortgage program by nominal amount.

• Joined the Energy Efficient Mortgage Label to advance transparent reporting and sustainable property finance; became the first institution to publish its EEML template.