Euro Banking News

Three reasons to consider banking at Jyske Bank to protect your wealth.

The first reason? Recent European banking stress test shows that most European banks are in fair enough shape.

The second reason is the fact that European shares are selling at a much better price than US shares. The Morgan Stanley US Share Index shows US shares trading at 2.72 times book value while European shares are trading at 1.8 times book value. This means that good value is more likely to be found in European bank shares than in the USA.

One of my core portfolio holdings for over a decade has been shares in Jyske Bank.

jyske Bank

Jyske Bank Share chart. (Click on image to enlarge.)

In 2002 I was conducting a seminar at Jyske’s headquarters in Silkeborg, Denmark. We had always been impressed by Jyske’s staff. The company had permeated the attitude amongst its people so they are super committed to giving good and unique customer service. I have been a client and have worked with the bank for over a decade and my experience has been that of great efficiency.

We were so impressed on the tour that in the middle of the presentation I borrowed Thomas Fischer’s cell phone and immediately bought Jyske shares at DKK 96.50 on 2nd September 2002.

The performance was so stellar that I sold a portion in April 2006 at DKK 352.50. Our profit was 265.28% in Danish kroner terms. But at the date of purchase the USD-DKK rate was 754 and dropped to 612 meaning that we gained another 18.8% in US dollars on the currency appreciation.

I held the remaining shares through the 2007 global equity market crash.

Jyske Bank

Jyske Bank share price 2006 to 2014. (Click on image to enlarge).

Though the shares have not returned to their 352 kroner per share level, I expect they will.

The third reason I like banking at Jyske and holding Jyske Bank shares. A Reuters’ announcement after the recent European bank stress test says: “Jyske Bank doubles nine-month profit, passes stress test”.

The article says: Jyske Bank said it had doubled pre-tax profit in the first nine months of this year to 3.4 billion Danish crowns ($579 million) from 1.7 billion crowns in the same period a year ago.

In addition the article pointed out that Jyske passed the stress test with a Capital Equity Tier 1 ratio of 13.6 percent, almost three times the minimum 5.5 percent threshold.


(1) Reuters article on Jyske Bank’s 2014 results

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