Vestjysk Bank A/S (VJBA), which last year fired its chief executive officer as loan losses surged, fell the most in five months in Copenhagen trading after Danske Markets said recent share gains were overdone.
Vestjysk fell as much as 12 percent, the most since March 1. The stock retreated 8.5 percent to 13 kroner at 10:06 a.m. in the Danish capital with trading volume at 356 percent of the three-month daily average.
The Lemvig, Denmark-based bank said May 1 that it returned to profit in the first quarter after posting its worst net losses in the previous two three-month periods. Danske today repeated a recommendation that investors sell the share after the stock gained 46 percent in the three days through yesterday, due to what the Copenhagen-based bank described as “unknown reasons.”
Vestjysk trades above the valuation of Spar Nord Bank A/S and on a level with Sydbank A/S, “banks with much less risk and much stronger capitalisation,” Danske said, referring to Denmark’s fourth- and third-largest listed lenders.
Vestjysk is due to report second-quarter earnings on Aug. 29. The Danish government owns about 52 percent of the shares after the lender converted state hybrid loans into equity.
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