Jyske Bank (JYSK) Q2 2024 earnings summary

Executive summary

• Net profit for Q2 2024 reached DKK 1.3 billion, up 12% year-over-year, marking the strongest Q2 performance to date, with continued inflow of customer funds and high private banking satisfaction.

• The bank is targeting the upper half of its DKK 4.3–5.1 billion net profit guidance for 2024, with new organizational structure implemented to enhance efficiency, digitization, and risk management.

• Strong operating performance was driven by higher assets under management (AUM), client fund inflows, and positive financial markets, offsetting low housing market activity and lower central bank rates.

• Cost inflation remains controlled, with a slightly higher cost base expected for 2024, partly due to sector-wide salary increases and integration costs.

• Successful IT migration and integration of PFA Bank, with organizational changes to enhance customer orientation and control functions.

Financial highlights

• Net profit reached DKK 1,337m in Q2 2024, up 12% year-over-year; earnings per share rose from DKK 19 in Q1 to DKK 19.8 in Q2, up over 10% year-over-year.

• Return on equity stable at 11.6% year-over-year; CET1 ratio at 16.6%, within the 15%–17% target range.

• Cost/income ratio at 48% in Q2 2024; loan losses at zero basis points in Q2 and two basis points for H1.

• Net interest income (NII) up 5% year-over-year for H1, but down 2% from Q1 due to lower deposit margins after policy rate cuts.

• Fee income up 9% year-over-year in Q2, driven by positive markets, net inflows, and PFA Bank acquisition; AUM up 22% year-over-year and 4% quarter-over-quarter.

Outlook and guidance

• Net profit guidance narrowed to the upper half of DKK 4.3–5.1 billion; EPS expected in the upper half of DKK 64–76.

• Core income expected to be lower in 2024 than 2023, mainly due to lower value adjustments; core expenses slightly higher, partly offset by synergies and lower one-off costs.

• Loan impairment charges now expected to be only slightly higher than 2023.

• CET1 ratio target range maintained at 15%–17%, with a 30% dividend payout ratio and ongoing share repurchases.

• Anticipates further central bank rate cuts in autumn, which will pressure deposit margins and expects gradual recovery in activity-based fees.