Danish bank announces rights issue in bid to resist having to accept state aid

DENMARK&rsquo;S second biggest bank, Jyske Bank, intends to raise nearly 1.2bn Danish crowns (&pound;144m) by issuing new stock to its existing shareholders, it announced yesterday.<br /><br />The bank, which accounts for around seven per cent of the Danish banking market, hopes the rights issue will strengthen its capital base and fend off the need for government help.<br /><br />The move should mean the bank does not have to rely on government loans, after the state has recently been helping troubled banks by offering capital.<br /><br />It follows the example of the next largest bank Sydbank, which raised 877.5m crowns by offering new stock in September.<br /><br />If Jyske Bank avoids taking state aid then it could save 175m crowns per year, almost halving its interest expenses to 200m crowns.<br /><br />Chief executive Anders Dam said that the bank is already well positioned, but the share issue will give it the best access to future growth opportunities. <br /><br />The bank has appointed Handelsbanken Capital Markets and JP Morgan as joint global coordinators and bookrunners for the share issue.<br /><br />Handelsbanken will also be financial advisers for the bank.<br /><br />&ldquo;Jyske Bank expects to make a further announcement in relation to the share issue during the second week of November,&rdquo; the group said.<br />