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BankNordik

BankNordik

Faroe-based Northatlantic bank

BankNordik is headquartered in the Faroe Islands. It holds between 40% and 50% of the market. The bank also has a small (but fast growing) operation in Greenland. It operates its own non-life insurance company in the Faroe Islands. BankNordik’s dividend policy is to pay out 50% of net profits while it targets a CET1 ratio of 23%.

BankNordik is optimising its business and divesting non-core units. We expect it to continue the efficiency measures. The divestment of Danish branches in the start of 2021 could pave the way for massive buybacks and an improved dividend policy.

Regulatory risks as well as credit risk are the biggest risks in the BankNordik investment case. New regulations such as Basel IV, MREL and IFRS 9 will be implemented over the coming years. Margin pressure is a risk to profitability as well.

DKKm 2020 2021e 2022e
Total Income 387 401 415
Total operating costs -238 -240 -240
Operating profit 152 249 198
EPS Adj 16,81 17,06 25,44
EPS adj growth (%) -25,6 1,5 49,2
BVPS 237,94 301,12 333,94
NAVPS 237,69 300,75 333,51
DPS 5 10,77 12,27
ROE (%) 7,6 9,7 8,4
RONAV (%) 7,4 6,5 8,1
C/I (%) 63 59,6 57,5
Loan losses (%) -0,07 0 -0,18
CET1 ratio (%) 22,6 27,1 25
P/E Adj (x) 9 10 6,7
P/BV (x) 0,64 0,56 0,51
P/NAV (x) 0,64 0,57 0,51
Dividend yield (%) 3,3 6,3 7,2
N/A N/A N/A
DKKm 2020 2021e 2022e
Net interest income 258 262 269
Net commission income 60 63 67
Trading income 0 0 0
Insurance income 45 51 54
Other operating income 24 25 26
Total income 387 401 415
Personnel costs -238 -240 -240
Other operating costs -1 0 0
Total operating costs -238 -240 -240
Profit before loan losses 149 161 175
Loan losses 5,24 0 15
Investment portfolio -2 8 8
Other items 0 80 0
Operating profit 152 249 198
Tax -40 -48 -38
Other items after tax 54 5 0
Net profit 166 206 161
Tax rate (%) -26,4 -19,4 -19
EPS 17,44 25,56 26,43
Net Profit Adj 161 139 156
EPS Adj 16,81 17,06 25,44
Key balance sheet data 2020 0 0
Net lending 7608 7846 8139
Goodwill and intangibles 2 2 2
Total assets 17290 11812 12104
Shareholders equity 2271 1971 1872
Net asset value 2269 1968 1870
Capital adequacy 2020 0 0
Tier 1 Capital, excl.hybrids 2206 1842 1766
Tier 1 Capital, reported 2357 1993 1917
Capital base 2581 2218 2142
Risk exposure amount (BIS II) 9774 6792 7061
Asset quality 2020 0 0
Problem loans, gross 671 527 537
Provisions for problem loans -469 -344 -337
Problem loans, net 202 183 200
Key figures N/A N/A N/A
Profitability 2020 2021 2022
Net interest margin (%) 1,5 1,8 2,2
ROE (%) 7,6 9,7 8,4
RONAV (%) 7,4 6,5 8,1
ROREA (%) 1,6 2,5 2,3
Cost efficiency 2020 0 0
Cost / income Core (%) 63 59,6 57,5
Costs / assets Core (%) 1,34 1,65 2,01
Financial position 2020 0 0
Net lending / deposits (%) 98,4 101,5 105,2
REA / assets (%) 56,5 57,5 58,3
Common equity tier 1 ratio (%) 22,6 27,1 25
Tier 1 ratio, reported (%) 24,1 29,3 27,2
Capital adequacy (%) 26,4 32,7 30,3
Equity ratio Core (%) 12,8 15,6 14,6
Asset quality 2019 0 0
Problem loans, gross / lending (%) 7,9 6,2 6,1
Problem loans, net / lending (%) 2,7 2,3 2,5
Provision ratio (%) 69,9 65,3 62,7
Loan losses, net / lending (%) -0,1 0 -0,2
N/A N/A N/A

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Media

BankNordik - Company presentation with CFO Rune Nørregaard

Main shareholders - BankNordik

Main shareholders Share capital % Voting shares % Verified
Fíggingargrunnurin frá 1992 34.4 % 34.4 % 27 Feb 2020
Henrik Lind (Lind Invest) 12.0 % 12.0 % 27 Feb 2020
Protector Forsikring ASA 10.0 % 10.0 % 5 Jan 2021
Sp/F Framherji 5.0 % 5.0 % 27 Feb 2020
P/F Tjaldur 5.0 % 5.0 % 27 Feb 2020
Handelsbanken Fonder 3.2 % 3.2 % 31 Jan 2021
Eika Kapitalforvaltning 1.2 % 1.2 % 28 Feb 2021
P/F BankNordik 0.7 % 0.7 % 31 Dec 2019
BIL Danmark 0.4 % 0.4 % 31 Oct 2020
Dimensional Fund Advisors 0.4 % 0.4 % 31 Jan 2021
Source: Holdings by Modular Finance AB