Vestjysk Bank’s Q1-Q3 2020 Quarterly Report

Nasdaq Copenhagen A/S

18 November 2020

Q1-Q3 2020 Highlights

Vestjysk Bank reported a profit after tax of DKK 250 million for Q1-Q3 2020. The performance was adversely affected by economic uncertainty caused by the Coronavirus crisis, African swine fever in Germany and the Brexit situation. These factors impacted the Bank’s impairment provisions based on a management estimate. In Q3 2020, the Bank made an additional DKK 50 million loss provision for the risks related to Britain’s exit from the European Union (Brexit) and the current uncertainty regarding African swine fever. With this, the Bank has made total impairment provisions of DKK 250 million in response to the economic uncertainty, corresponding to 2.6% of the Bank’s net loans and advances.

The figures below were for 2019 affected by a transaction in Sparinvest, where the Bank realized an earning at DKK 142 million.

• Profit after tax was DKK 250 million, Q1-Q3 2019: DKK 397 million, for an annualised return on equity after tax of 10.9%.
• Core income of DKK 653 million, Q1-Q3 2019: DKK 827 million (Excl. Sparinvest DKK 685 million).
• Market value adjustments amounted to DKK 42 million, Q1-Q3 2019: DKK 173 million (Excl. Sparinvest DKK 46 million).
• Cost ratio of 58.1, Q1-Q3 2019: 44.5 Excl. Sparinvest DKK 127 million).
• Core earnings before impairment allowances amounted to DKK 274 million, (Q1-Q3 2019: DKK 460 million (Excl. Sparinvest DKK 318 million).
• Impairment of loans and receivables, etc. of DKK 4 million (Q1-Q3 2019: DKK 44 million). Impairment allowances on agriculture amounted to a net reversal.
• The Bank’s capital requirements totalled 13.0%, consisting of an individual solvency need of 10.5% and a general capital conservation buffer of 2.5%. The MREL was phased in at 1.875%, which was added to the capital requirement. The individual solvency need included a management estimate concerning the economic situation of DKK 50 million, or 0.38 of a percentage point.
• The Bank’s capital ratio was 23.8. The excess cover was 10.8 percentage points, or DKK 1,420 million.
• The Bank’s MREL ratio was 23.8. The excess cover was 8.9 percentage points, or DKK 1,172 million.