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Den Jyske Sparekasse

Den Jyske Sparekasse

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Danish savings bank

DJS has a market share of well below 1% in Denmark with lending exposure concentrated in the middle part of Jutland. The bank has 19 branches, ~350 employees and 97,000 customers. Exposure is tilted towards agriculture (~17%) but DJS is seeking to reduce its exposure to agriculture as well as to real estate (below 10%). DJS has introduced an intention of a 25% dividend pay-out at some point in the future depending on its capital accumulation.

Den Jyske Sparekasse (DJS) was recapitalised by a group of investors in 2018 ahead of the November IPO, giving the bank better capacity to handle its challenged agri exposure. A high earnings shield implies upside if conditions in the agri sector should improve, while a high interest-rate sensitivity implies upside if interest rates should at some point begin to rise.

Credit risk is the biggest risk for DJS, which has an exposure to cattle farming and pig farming of ~12% of loans and guarantees. The bank is sensitive to a drop in milk and pork prices. New regulations such as MREL and Basel IV remain a risk for DJS. Furthermore, the bank's capital plans do not allow for high lending growth in the short term.

Financials

DKKm 2019 2020e 2021e
Total Income 772 628 634
Total operating costs -463 -451 -456
Operating profit 148 60 98
EPS Adj 5,97 5,12 8,96
EPS adj growth (%) -47,1 -14,2 74,9
BVPS 166,7 171,94 181,73
NAVPS 166,1 171,41 181,2
DPS 0 0 0
ROE (%) 9,3 3,5 5,5
RONAV (%) 3,8 3 5,1
C/I (%) 69,1 72,8 72,8
Loan losses (%) 2,05 1,53 1,12
CET1 ratio (%) 15,8 18 18,6
P/E Adj (x) 12,2 13,1 7,5
P/BV (x) 0,44 0,39 0,37
P/NAV (x) 0,44 0,39 0,37
Dividend yield (%) 0 0 0
N/A N/A N/A
DKKm 2019 2020e 2021e
Net interest income 374 358 350
Net commission income 246 245 258
Trading income 131 17 18
Insurance income 0 0 0
Other operating income 20 9 8
Total income 772 628 634
Personnel costs -260 -260 -263
Other operating costs -203 -191 -193
Total operating costs -463 -451 -456
Profit before loan losses 309 177 178
Loan losses -160,57 -117,28 -80
Investment portfolio 0 0 0
Other items 0 0 0
Operating profit 148 60 98
Tax -1 -1 -1
Other items after tax 0 0 0
Net profit 148 59 97
Tax rate (%) -0,6 -1 -1
EPS 14,89 5,95 9,79
Net Profit Adj 59 51 89
EPS Adj 5,97 5,12 8,96
Key balance sheet data 2019 0 0
Net lending 7675 7173 7317
Goodwill and intangibles 6 5 5
Total assets 15956 15963 16106
Shareholders equity 1655 1707 1804
Net asset value 1649 1702 1799
Capital adequacy 2019 0 0
Tier 1 Capital, excl.hybrids 1739 1779 1868
Tier 1 Capital, reported 1839 1879 1968
Capital base 2086 2126 2215
Risk exposure amount (BIS II) 11011 9865 10062
Asset quality 2019 0 0
Problem loans, gross 2361 2466 2565
Provisions for problem loans -1108 -1094 -1174
Problem loans, net 1253 1372 1391
Key figures N/A N/A N/A
Profitability 2019 2020 2021
Net interest margin (%) 2,4 2,2 2,2
ROE (%) 9,3 3,5 5,5
RONAV (%) 3,8 3 5,1
ROREA (%) 1,3 0,6 1
Cost efficiency 2019 0 0
Cost / income Core (%) 69,1 72,8 72,8
Costs / assets Core (%) 2,96 2,83 2,84
Financial position 2019 0 0
Net lending / deposits (%) 71,6 65,7 67
REA / assets (%) 69 61,8 62,5
Common equity tier 1 ratio (%) 15,8 18 18,6
Tier 1 ratio, reported (%) 16,7 19 19,6
Capital adequacy (%) 18,9 21,6 22
Equity ratio Core (%) 10,9 11,1 11,6
Asset quality 2019 0 0
Problem loans, gross / lending (%) 20,9 22,4 22,8
Problem loans, net / lending (%) 16,3 19,1 19
Provision ratio (%) 46,9 44,4 45,8
Loan losses, net / lending (%) 2,1 1,5 1,1
N/A N/A N/A

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Main shareholders - Den Jyske Sparekasse

Main shareholders Share capital % Voting shares % Verified
AP Pension 15.7 % 15.7 % 31 Mar 2020
Finansiel Stabilitet 12.5 % 12.5 % 31 Dec 2019
Nykredit Realkredit A/S 8.8 % 8.8 % 31 Dec 2019
A/S Arbejdernes Landsbank 5.2 % 5.2 % 31 Dec 2019
Danske Invest (DK) 0.1 % 0.1 % 31 Jul 2020
Claus E. Petersen 0.1 % 0.1 % 31 Dec 2019
Ib Kristensen 0.0 % 0.0 % 31 Dec 2019
Jan Nordstrøm 0.0 % 0.0 % 13 Aug 2019
Bjarne L. Petersen 0.0 % 0.0 % 31 Dec 2019
Torben Sørensen 0.0 % 0.0 % 31 Dec 2019
Source: Holdings by Modular Finance AB