Jyske Bank H1 2024 Financial Overview
Net interest income increased by 5% to DKK 4,877m
Core income rose by 4% to DKK 6,828m
Core expenses increased by 6% to DKK 3,160m
Loan impairment charges amounted to an expense of DKK 95m
Net profit grew by 5% to DKK 2,623m
Capital ratio stands at 21.9%, with a common equity tier 1 capital ratio of 16.6%
Net profit is projected to fall within the upper half of the previously announced range of DKK 4.3bn-5.1bn for 2024
Organizational changes and new appointments to the Group Executive Board
Successful IT migration of PFA Bank from BEC to Bankdata
Share buy-back program of up to DKK 1.5bn
Summary
In the first half of 2024, Jyske Bank's net profit increased by 5% due to strong operational performance and rising interest rates. This growth occurred despite challenges such as a sluggish housing market and significant inflation. We expect net profit to land in the upper half of our earnings forecast for 2024, even with adjustments in monetary policy rates. During this period, we also implemented initiatives to enhance our client offerings and successfully migrated PFA Bank to Jyske Bank’s platform, alongside an organizational change aimed at improving client focus and operational efficiency.” says Lars Mørch, CEO and Managing Director.
Jyske Bank's net profit for the first half of 2024 reached DKK 2,623m, reflecting a 5% increase driven by higher net interest income, which benefited from a favorable interest-rate environment. This growth effectively offset the rise in core expenses linked to salary adjustments and the acquisition of PFA Bank. The robust performance of the Danish economy has continued to withstand the pressures of rising interest rates.
In May 2024, Jyske Bank undertook a restructuring to enhance efficiency and client focus. The newly revised Group Executive Board now includes key positions dedicated to overseeing 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 30 years of experience to the position. Additionally, Jacob Gyntelberg will join as Chief Risk Officer after a distinguished career in risk analysis and management.
The successful integration of PFA Bank was completed in the first half of 2024, which included an IT migration designed to improve client service. This initiative underscores Jyske Bank's commitment to addressing client needs and ensuring high satisfaction levels, as indicated by independent surveys.
To further enhance customer value, Jyske Bank introduced new savings products and competitive home loan offers. A partnership with MyHomes will also provide existing clients with better access to holiday properties abroad.
Jyske Bank is dedicated to the green transition, aiming for net zero CO2 emissions in its lending and investment activities by 2045 and 2050, respectively. The bank has enacted policies targeting significant reductions in CO2 emissions by 2030.
Earnings per share
Earnings per share rose to DKK 38.8, up from DKK 37.5 the previous year, reflecting strong financial performance with a return on equity of 11.5%.
The overall business volume remained stable, although there was a slight decline in bank loans due to reduced mortgage-related lending. Conversely, mortgage loans for corporate clients increased by 1%, as did assets under management, which benefited from favorable market conditions.
Core income saw a 4% increase, primarily driven by net interest income. Improvements in the bond market contributed to higher profitability, despite challenges in the housing sector. Core expenses rose by 6%, largely due to sector-wide salary increases and an expanded workforce aimed at combating financial crime.
Loan impairment charges decreased to DKK 95m from DKK 109m in the previous year, reflecting continued strong credit quality.
By the end of the first half of 2024, Jyske Bank's common equity tier 1 capital ratio was reported at 16.6%, supporting a stable capital base that enables the resumption of dividend payments and a new share buy-back program.
2024 outlook
The bank anticipates a net profit in the upper range of DKK 4.3bn-5.1bn for 2024, with earnings per share expected to reflect a similar trend. Although core income may experience a slight decline due to reduced market activity, expenses are projected to remain steady, factoring in ongoing integration costs from previous acquisitions.
Webcast and conference call
Jyske Bank will conduct a conference call aimed at investors and analysts on a future date, with details to be shared 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, marking 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, compared to 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 a restructuring aimed at enhancing client orientation and efficiency, along with 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.
