BBVA has now published its Q4 results. According to Morgan Stanley “net profit of €1.58bn in the last quarter of 2022 beat consensus by 2.5%, with NII (Net Interest Income) 1.4% higher than expected, fees and commissions 2% lower and overall total revenues in line with expectations.
Operating profit before provisions and costs were also in line. Good capital data, with CET1 16 bps quarter-on-quarter up (+30 bps vs. consensus) and standing at 12.6%.
In addition, the company announced a DPS (Dividend per Share) of €0.31 for the full year, and a buyback of €442mn, accumulating a total yield of 6%.
By regions, NII was better in Spain and Mexico (+17% quarter-on-quarter and +8.5% quarter-on-quarter respectively), partially offset by currency effects in Turkey and Argentina.
In terms of guidance, the company expects NII in Spain to grow >20% year-on-year (up 20% year-on-year) (MSestima +25% year-on-year), costs +5% (in line) and a CoR of 35bps (40bps MSe).
Overall, our experts believe the results are in line, but highlight the strong momentum in NII and guidance, so they believe the consensus will revise their estimates upwards for NII and downwards for provisions in 2023.
At 0.9x P/NVA (0.9x Net Value Assets) for a ROTE (return on equity) 2023 of 12%, OW reiterates”.