BankNordik: Q1 2022 first impression - A solid start to the year - Nordea

Q1 2022 PBLL came in at a solid DKK 49m, DKK 4m (9%) above our estimate, led by strong numbers across all income lines. Net interest income was stable q/q, but 3% above our estimate, as negative interest on deposits and a steady increase in lending offset margin pressure. Net fee income came in at DKK 22m, 6% ahead of our estimate. Also, insurance income was solid following last year’s repricing efforts. On the negative side, BankNordik reported a miss on costs due to higher IT expenses. CET1 ratio came in at 23.8% in Q1 2022. We estimated 24%. Comments on asset quality is in focus amid the war in Ukraine. Although long-term implications of the war remain uncertain, loan loss reversals of DKK 10m contributed positively to the Q1 2022 result. Following solid profitability in Q1 2022, BankNordik now aims at the upper range of the previously communicated full-year guidance range (net profit DKK 130-160m), according to management. We estimate DKK ~144m and hence positive revisions are warranted. All in all, a strong start to the year, which lays a solid foundation for the ongoing capital repatriation efforts. The share should trade in-line or above peers following today’s report.