Jyske Bank H1 2024 Financial Overview
Net interest income rose 5% to DKK 4,877m
Core income rose 4% to DKK 6,828m
Core expenses rose 6% to DKK 3,160m
Loan impairment charges amounted to an expense of DKK 95m
Net profit was up by 5% to DKK 2,623m
Capital ratio at 21.9%, with common equity tier 1 capital ratio at 16.6%
Net profit is expected to be in the upper half of the previously announced range of DKK 4.3bn-5.1bn in 2024
Organisational change and appointment to the Group Executive Board
Successful IT migration of PFA Bank from BEC to Bankdata
Share buy-back programme of up to DKK 1.5bn
Summary
In the first half of 2024, net profit was up 5% due to solid operations and higher interest rates. This increase defied low housing market activity and significant inflationary headwinds. We anticipate net profit in the upper half of earnings expectations for 2024 despite adjustments to monetary policy rates. The period also included initiatives to enhance client offerings and a successful IT migration of PFA Bank to Jyske Bank’s platform, as well as an organizational change aimed at improving client orientation and operational efficiency.”, says Lars Mørch, CEO and Managing Director.
Jyske Bank’s net profit rose by 5% to DKK 2,623m in the first half of 2024, fueled by increased net interest income benefiting from a favorable interest-rate environment. This progress more than offset rises in core expenses resulting from salary adjustments and the acquisition of PFA Bank. The robust Danish economy has continued to show strength against rising interest rates.
In May 2024, Jyske Bank restructured its organization to enhance client focus and efficiency. The revised Group Executive Board now includes key roles designed to oversee corporate clients, personal clients, and risk management.
Erik Gadeberg has been appointed as the new Managing Director of Corporate Clients and Capital Markets, bringing over three decades of experience to the role. Additionally, Jacob Gyntelberg will join the team as Chief Risk Officer after a notable career in risk analysis and management.
The successful integration of PFA Bank was finalized in the first half of 2024, including an IT migration aimed at improving client service. This move emphasizes Jyske Bank's commitment to meeting client needs and securing high satisfaction levels, as reflected in independent surveys.
New savings products and competitive offers for home loans were introduced, further demonstrating Jyske Bank's dedication to enhancing customer value. A partnership with MyHomes will also provide existing clients with better access to holiday properties abroad.
Jyske Bank is committed to the green transition, targeting net zero CO2 emissions in its lending and investment activities by 2045 and 2050, respectively. The bank has implemented policies aimed at substantial reductions in its CO2 emissions by 2030.
Earnings per share
Earnings per share increased to DKK 38.8 compared to DKK 37.5 the previous year. This reflects strong financial performance with a return on equity of 11.5%.
The overall business volume remained stable, although a slight decline in bank loans was recorded due to lower mortgage-related lending. Conversely, mortgage loans for corporate clients increased by 1% as did assets under management, boosted by favorable market conditions.
Core income saw a 4% rise driven primarily by net interest income. Improvements in the bond market led to higher profitability, despite challenges in the housing market. Core expenses increased by 6%, largely due to sector-wide salary hikes and the increased workforce aimed at combating financial crime.
Loan impairment charges were reduced to DKK 95m from DKK 109m in the previous year, reflecting ongoing strong credit quality.
By the end of the first half of 2024, Jyske Bank's common equity tier 1 capital ratio stood at 16.6%, supporting a stable capital base that allows the resumption of dividend payments and a new share buy-back program.
2024 outlook
The bank projects a net profit in the upper range of DKK 4.3bn-5.1bn for 2024, estimating earnings per share similarly. While core income may decline slightly due to reduced market activity, expenses are expected to remain steady with ongoing integration costs from previous acquisitions.
Webcast and conference call
Jyske Bank will host a conference call targeting investors and analysts at a forthcoming date, details to be provided via the bank's investor relations page.
Yours faithfully,
Jyske Bank
Contact:
Lars Mørch, CEO and Managing Director, tel. +45 89 89 20 01
Birger Krøgh Nielsen, CFO, tel. +45 89 89 64 44
Frequently Asked Questions
What were Jyske Bank's net profit results for H1 2024?
Jyske Bank reported a net profit of DKK 2,623m, which is a 5% increase compared to H1 2023.
How did Jyske Bank's core income perform in H1 2024?
Core income rose by 4%, reaching DKK 6,828m against DKK 6,573m in H1 2023.
What was the capital ratio of Jyske Bank at the end of H1 2024?
The capital ratio was reported at 21.9%, with a common equity tier 1 capital ratio of 16.6%.
What significant changes occurred in Jyske Bank's organization?
There was an organizational restructuring to enhance client orientation and efficiency, alongside key appointments to the Group Executive Board.
What are Jyske Bank's goals for CO2 emissions?
The bank aims for net zero emissions in its lending and investment activities by 2045 and 2050, respectively.
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