Singular Bank | The ECB revises and determines minimum capital requirements for each lender annually so that, in function of its own funds, it has an established guarantee of solvency. In this respect, for 2023, BBVA will have to have a CET1 ratio of 8.72% (vs 8.60% in 2022) and a total capital level of 12.97% (vs 12.76%). In the case of Sabadell, the CET1 will have to be 8.65%, compared…
Morgan Stanley | The Spanish Banking Association (AEB) has reached an agreement with trade unions to raise salaries by 4.5% in 2023. This figure compares with the 5% increase in costs which analysts had in their models for 2023-2024. It also compares with the estimates for a 25% growth in NII in Spain in 2023. Although this agreement only applies to Santander, BBVA, Sabadell and Bankinter, Álvaro Serrano believes that a…
Morgan Stanley | Spanish banks have underperformed 8% since their results, despite having beat NII estimates by 4%. The market is pricing in a slowdown in NII due to the increase in the costs of deposits with the end of the TLTRO and the start of competition anticipating what we are seeing in the US. Alvaro Serrano considers this to be an inaccurate analysis, given that the situation in the…
The Corner | Caixabank posted an 18.8% rise in third quarter net attributable profit, beating consensus forecasts, and driven by a strong rise in revenues, including commissions. Net interest income was up 5% quarter-on-quarter at 1.687 billion euros. Morgan Stanley analysts noted that despite a slight uptick in costs, operating profit before provisions (Ppop) beat estimates by 8%, underpinned by a 25% drop in provisions, which was below expectations. “Overall, Álvaro…
Morgan Stanley |We have carried out a survey amongst our sectorial analysts to find out their estimates with regard to consensus expectations for each sector. Also to identify where they are most confident in terms of results. The survey flags a solid Q3, with 50% of sectors beating forecasts vs 13% seen as falling behind. That said, looking ahead at FY’23, my analysts predict a clear downside risk to consensus…
Morgan Stanley | We are expecting a positive surprise in NII (+3.6% QoQ), which will allow for upgrades in consensus estimates for 2023. Meanwhile, in terms of provisions we are expecting stable figures. We see the best momentum in terms of profits for BBVA and Caixabank (both Overweight) and there could be a catch up in Banco Santander, as the political uncertainty lessens. Santander – Good numbers in Spain. The…
Alphavalue/DIVACONS | The chairman of Caixabank, José Ignacio Goirigolzarri, flagged on Thursday that the financial sector must obtain a level of profitability which is higher than the cost of capital, a challenge with which the normalisation of interest rates will help. That said, he believes this hike “will not be sufficient” to achieve this. So the banking sector will have to redouble the transformation efforts made during the last few…
Morgan Stanley | Overview of Q2: 80% of the banks have exceeded in terms of PBT, clocking up the 6th consecutive quarter with a positive surprise. And the main driver of the outperformance in revenues has been the NII, whose strength has arrived ahead of schedule (growing 11%/5% YoY/QoQ). The NII should remain strong in 2023, as we are factoring in a further 50bp rise in interest rates, and with…
Morgan Stanley | Global financial institutions. We revise our order of preference. This list represents the stocks where there is greater conviction at a global level with a time frame of 3-6 months. We periodically revise this list to make it more dynamic and reflect the changes in vision and market conditions. Today we are incorporating Caixabank to that list (we are 10% above consensus and there is a risk…
The growth was underpinned by the bank’s business in loans and long-term savings products and lower expenses due to synergies from the merger with Bankia. This led to a rise in operating profit (+5.4%), and a reduction in loan-loss provisions (-23.2%) and other provisions (-37.7%). The NPL ratio declined to 3.5% in the fourth quarter and the coverage ratio rose to 65%, following the fall of EUR 272 million in…