BankNordik upgraded its guidance for ‘21 net profit on 19 July to DKK 190-220m (DKK 150-200m) linked to low loan losses; we estimate a ‘21 net profit of DKK 227m from good business momentum. The bank announced new profitability initiatives with Q2, pointing to an effect of DKK 20-25m per year, of which DKK 19m was not already part of our estimates (8.5% on 2023e EPS). BankNordik will charge Faroe retail clients 75bp (60bp) for deposits above DKK 100,000 (250,000) from mid-August (DKK 10m NII gain per year) while fee initiatives are to bring DKK 5m per year. An EGM notice is to be issued in Sep. (EGM in Oct.) regarding the DKK 450m EO distribution for 2021; with no government decision taken to exit its 35% stake, we still expect this to be paid as an EO DPS of DKK 47.
‘23e adj. EPS is up 10% (see page 3). We now estimate a RONAV in ‘23 of 10.1% while we see a ‘22 adj. P/E of 8.5x; adjusted for the DKK 59 DPS in 2021e, the ‘22e adj. P/E is just 5.5x.
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