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Jan. 23 (Bloomberg) -- Vestjysk Bank A/S, the regional bank that may ask the Danish government to take a stake, jumped the most in more than two decades in Copenhagen trading after a local investment newsletter said it was a good buy.
Vestjysk Bank advanced as much as 54 percent, the most since at least October 1989, making it today’s biggest mover on Copenhagen’s stock exchange. The shares gained 5.50 kroner, or 38 percent, to 19.80 kroner at 11:36 a.m., giving the Lemvig, Denmark-based lender a market value of 248 million kroner ($43.2 million).
The bank is a “super attractive lottery ticket,” AktieUgebrevet, a weekly newsletter for private investors, wrote in this week’s edition published today. The low share price reflects a “bankruptcy-like scenario,” which the newsletter said was “unlikely.”
Vestjysk Bank said Jan. 19 it may convert some state-held hybrid capital to shares. The lender needs to refinance about $1.38 billion kroner in state-backed bonds by 2014 and was told by financial regulators in December to write down 550 million kroner more in loans. The bank’s shares hit a two-decade low on Jan. 10 after local media reported it failed to get support from Denmark’s biggest banks for a 500 million-krone share issue.
The bank is “not in a deep crisis,” Vestjysk Bank Chief Executive Officer Frank Kristensen said earlier this month. “We are not even close to going bankrupt or anything like that.”
--Editors: Christian Wienberg, Tasneem Brogger.
To contact the reporter on this story: Frances Schwartzkopff in Copenhagen at firstname.lastname@example.org
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