BankNordik: Q4 2020 first impression, DKK 73 per share in dividends from the sale of DK - Nordea

Q4 2020 net profit came in at DKK 43m, which was DKK 8m (24%) ahead of our estimate. The main positive deviation was loan loss reversals of DKK 10m, which was 20m better than our estimate. On the negative side, profits from discontinued operation (the Danish activities) ended DKK 23m below our estimate. BankNordik guides for 2021 net profit of DKK 150-200m. We estimate DKK 207m. BankNordik proses a 2020 DPS of DKK 5. We had estimated DKK 4.8. Furthermore, the bank intends to distribute additionally DKK 450m during 2021 related to the sale of the Danish activities (DKK 50m above our estimate), as well as additionally DKK 250m during 2022 and 2023. We had expected additionally DKK 375m in 2022. The total distribution solely from the sale of the Danish activities hence corresponds to DKK 73 per share (~45% of closing share price yesterday). BankNordik also revises its financial targets: 1) CET-1 ratio of 23%. We estimate a 2022 CET 1 ratio of 23.3%. 2) Return on equity of 8%. We estimate a 2022 ROE of 6.4%. 3) Payout ratio of 50% (previously 20-40%). We estimate a 2022 pay-out ratio of ~75%.