Lan og Spar Bank is a small Danish retail bank built on an affinity/membership model (deposits + personal/consumer lending, distributed via affiliated unions/pension funds). It is fortress-capitalised — total capital ratio 22.7% / CET1 22.1%, ~8pp above the requirement — with benign loan losses (~0.1%). ROE is ~12.0% (FY2025), residual income +DKK 68m over a 10% cost of equity — value-creative, but only a thin ~2pp spread.
It trades at 1.20x book, 1.24x tangible and 10.6x earnings, with a low ~1.6% dividend yield (~17% payout) after a +91% 2025 re-rating. On a normalized 12% ROE the Gordon fair value is ~DKK 1,343 (+7%), but the anchor is highly sensitive (a 10% normalized ROE implies ~17% downside), net interest income is fading (Q1 2026 ROE ~9.4% as rate tailwinds reverse), the cost/income ratio is rising (to ~67%), and the share is very illiquid (only 3.47m shares, >52% held by five affiliated unions/pension funds). A fortress-balance-sheet micro-cap, roughly fairly valued, with execution/liquidity the dominant practical caveat.
Gordon fair P/B = (ROE-g)/(COE-g) with COE 10%, g 3% and a normalized 12% ROE -> ~1.29x -> ~DKK 1,343 (+7%); but a 10% ROE assumption implies ~17% downside — highly sensitive. Current 1.20x book, 10.6x earnings.
Base DKK 1,340 (normalized-ROE fair value); bull DKK 1,500 if ROE holds ~12% as cost/income stabilizes; bear DKK 1,050 on NII fade + a de-rate.
The operating reverse-DCF (NOPAT / invested capital / WACC) does not apply to a balance-sheet business — leverage is the raw material and "net debt" is not meaningful. The equity is valued on residual income: book equity plus the present value of returns above the cost of equity, discounted at Ke; the single-stage lens is the Gordon fair price-to-book, (ROE−g)/(Ke−g). The market prices in a sustainable ROE of 11.5% vs 11.4% currently earned; at a sustained 11.4% ROE the warranted P/B is 1.20× (DKK 1,247/sh, -1%).
| Scenario | 24m target | Impl. ROE | Upside | Prob. | Driver |
|---|---|---|---|---|---|
| Bull | DKK 1,500 | 13% | +20% | 25% | ROE holds ~12%; cost/income stabilizes |
| Base | DKK 1,340 | 12% | +7% | 50% | Normalized-ROE fair value |
| Bear | DKK 1,050 | 10% | -16% | 25% | NII fade + a de-rate |
| Prob-weighted | DKK 1,308 | — | +4% | 100% | Scenario-weighted expected value |
| Ke \ ROE | 10% | 14% | 18% | 22% | 26% | 30% | 34% |
|---|---|---|---|---|---|---|---|
| 8.50% | 1323 | 2080 | 2836 | 3592 | 4348 | 5104 | 5861 |
| 9.25% | 1165 | 1830 | 2495 | 3161 | 3826 | 4492 | 5157 |
| 10.00% (base) | 1040 | 1634 | 2228 | 2822 | 3416 | 4011 | 4605 |
| 10.75% | 939 | 1476 | 2012 | 2549 | 3086 | 3622 | 4159 |
| 11.50% | 856 | 1346 | 1835 | 2324 | 2814 | 3303 | 3792 |
Green = fair value above the current price of DKK 1,255.00. For a financial the surface is dominated by cost of equity and sustainable ROE — not unit growth.
⤓ Download the full model (.xlsx) — formula-driven sheets; flex the blue input cells and the model cascades in Excel.
Total capital 22.7% / CET1 22.1% — ~8pp surplus, very safe.
Union/membership-based lending is a low-cost, sticky niche.
~0.1% loan losses — low-risk book.
Large surplus capital could fund higher distributions.
Lan og Spar is a fortress-capitalised small Danish retail bank (CET1 22.1%, ROE ~12%) trading ~7% below a highly assumption-sensitive Gordon fair value, with very thin liquidity. HOLD; base DKK 1,340.
Quality + capital are not in doubt; the practical caveats are illiquidity, fading NII and valuation sensitivity.
Every adjustment traces to the cited note/page in the source filing — click to open it there. Source reports archived locally.
| Adjustment / figure | Value | Source | Why mttssn treats it this way |
|---|---|---|---|
| Net profit for the year (arets resultat) FY2025 | 411 | Hoved- og noegletal (5-year key figures) p.12 | Bank bottom line attributable to shareholders. FY2025 411.3 vs 462.6 in 2024 (-11%), pressured by lower net interest income as Danish rates fell. |
| Net interest income (netto renteindtaegter) FY2025 | 881 | Regnskabsberetning p.27 | Core bank revenue. Interest income 1,200.3 - interest expense 319.0 = 881.3m, down 103.4m YoY on the falling rate level outpacing loan/deposit growth. |
| Net fee and commission income FY2025 | 613 | Regnskabsberetning p.27 | Gross fees and commissions 688.8 (up 84.3m on customer growth, investment products, payments, mortgage broking) minus fees paid 75.5 = net 613.3m. Combined with NII gives the headline net-interest-and-fee income of 1,495.1m. |
| Net interest and fee income (netto rente- og gebyrindtaegter) FY2025 | 1,495 | Hoved- og noegletal p.12 | The bank's headline top-line metric. 1,495.1m, down 1.9% YoY (-29.4m): fee growth nearly offset the NII decline. |
| Profit before tax (resultat for skat) FY2025 | 537 | Hoved- og noegletal p.12 | Pre-tax profitability proxy for a bank (after costs, impairments and including the 58.8m portfolio/holdings result). Forrenter egenkapitalen 15.7% pre-tax. |
| Total equity (egenkapital) 31 Dec 2025 | 3,610 | Hoved- og noegletal / Balance p.12 | Bank invested-capital base. Up from 3,250.9m at end-2024 (retained earnings net of the 20.00/share dividend). Q1 2026: 3,621.8m. |
| Capital ratio (kapitalprocent) FY2025 | 0.227 | Hoved- og noegletal p.12 | Regulatory capital strength. Total capital ratio 22.7% vs a total capital requirement of 14.7% — a very strong ~8pp surplus. CET1 (kernekapitalprocent) 22.1%. |
| CET1 / core capital ratio (kernekapitalprocent) FY2025 | 0.221 | Hoved- og noegletal p.12 | Common equity tier 1 strength; 22.1% (Q1 2026 21.7%). Confirms a fortress, equity-heavy capital stack with minimal AT1/Tier 2. |
| Cost/income ratio (O/I-noegle) FY2025 | 0.671 | Hoved- og noegletal p.12 | 67.1% (67 ore of cost per krone earned), up from 58.8% in 2024 — elevated by a 9.6% rise in personnel/admin costs (more staff, IT, AML) against a falling top line. High vs efficient Nordic peers and a key earnings-quality watch item. |
| Loan impairments (nedskrivninger pa udlan) FY2025 | 35.2 | Regnskabsberetning p.27 | Cost of risk just 35.2m = 0.1% of loans and guarantees (down from 74.4m). Low-risk personal-lending book; Q1 2026 was a net reversal (+10.1m income, -0.04%). |
| Shares outstanding | 3,472,187 | Note 36 Aktiekapital p.137 | Share capital is 3,472,187 shares of nominal DKK 100 (nominal DKK 347,218,700), unchanged YoY. Very small absolute share count -> high nominal price and thin trading. Used for BVPS, P/B and market cap. |
| Book value per share (indre vaerdi pr. aktie) FY2025 | 1,044 | Hoved- og noegletal p.12 | Reported BVPS DKK 1,044.3 (up from 938.2). Drives P/B 1.20x at the DKK 1,255 price. Q1 2026 BVPS 1,047.8. |
| Dividend per share FY2025 | 20 | Hoved- og noegletal p.12 | Proposed DKK 20.00/share, unchanged from 2024; ~17% payout of EPS 118.8. Yield only 1.59% on DKK 1,255 after the +91% 2025 re-rating; surplus capital largely retained. |
| EPS (arets resultat pr. aktie) FY2025 | 119 | Hoved- og noegletal p.12 | Reported EPS DKK 118.8 on average 3,461k shares; gives P/E 10.6x at DKK 1,255. P/E (Borskurs/resultat) history 11.3 / 5.2 / 4.9 / 11.0 / 10.7 (2025-2021). |
| Total assets / loans / deposits FY2025 | 40,977 | Balance p.12 | Total assets 40,977.3m; loans (amortised cost) 19,534.6m; deposits 35,125.4m. Loan/deposit ratio 56.4% -> heavily deposit-funded, surplus liquidity (LCR 621.7%). Deposits +13%, loans +6.6% in 2025. |
| Five-year after-tax ROE history | 0.12 | Hoved- og noegletal p.12 | Egenkapitalforrentning efter skat: 12.0 / 15.1 / 17.9 / 8.7 / 9.4% (2025-2021). Volatile and rate-sensitive; supports a normalized ~12% (not the 2022-23 rate-driven highs) for the Gordon fair-P/B. |
| Q1 2026 net profit and capital | 85 | Kvartalsrapport 1. kvartal 2026 p.2-3 | Q1 2026 net profit DKK 85.0m (24.6/share), PBT 111.4m, after-tax RoE 9.4% p.a. — below the FY2025 12.0%, confirming ongoing margin compression. Capital ratio 22.3%, CET1 21.7%, requirement 14.6%. FY2026 guidance: net profit DKK 300-400m. |
How the mttssn view has evolved — each prior dated note is preserved.