The Q4’21 operating profit came in at DKK 82m (58m), 38% below ABGSC. Adjusting for loan losses, the profit before loan losses (PBLL) came in at DKK 112m, which were 12% below ABGSC. The net profit in Q4 on the other hand, came bang in line with ABGSC forecast. The main deviation compared our estimates was a stronger income side, mainly driven by net commission income and trading, however, higher cost surprised negatively compared to our estimates. The company highlights in their Q4-report that the merger with Den Jyske Sparekasse is proceeded according to plan and that the synergies are being realized and non-recurring costs in connection with the merger are lower than estimated, which we view as positive.
Q4 details: Solid NII growth, up 5% q-o-q
Looking at the Q4 details, the net interest income came in at DKK 211m (123m), which was 2% above ABGSC estimate and up 5% q-o-q. The loan book came in line with ABGSC forecast and grew with 1% q-o-q. The net commission income grew 6% q-o-q and came in at DKK 158m (87m), 5% higher than ABGSC expected. Total income as a whole was 4% above ABGSC, mainly driven by net commission income and trading, but also helped by NII. Total cost surprised negatively and came 12% above ABGSC at DKK 289m. The cost/income ratio saw a yearly increase in the fourth quarter, up 8 percentage points, coming in at 72.1% in Q4’21.
Except a rather neutral market reaction
The FY reported profit for 2021 was in accordance with the bank’s own forecast. The bank also guides for a profit before tax in 2022 of around DKK 600-650 million. This is in line with ABGSC estimate of DKK 628m for 2022, hence we do not expect any major estimate changes for 2022 on the back of the Q4 results. Given that we do not expect to see any major estimate changes on the back of the Q4 report,
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