Model update after Q4 earnings
- We updated our model due to better 2023 results, better NII and risk cost outlook.
- While the Romanian reference rate is set to decline to below 6% this year, but NII could be higher compared to 2023 on stellar volumes and repricing could be slower on the asset side.
- Asset quality should stay benign but positive contribution to earnings is unlikely to be sustainable thus we project it to be 32bps and 47bps for 2024 and 2025, respectively.
- We also included the turnover tax for the 2024-2026 period which is likely to be around RON 120 mln in 2024 and 2025 while it will decline to RON 70 mln in 2026.
- While the Bank still leaves ca. 9% upside from the current share price including dividends, we deem that other banks in our coverage offer better risk-return potential in our view.
Concorde Securities Ltd. is Hungary’s leading independent company engaged in investment banking activities. It provides its clients with integrated financial services, including securities trading, research, corporate financing advisory, capital market transactions, wealth management and investment advisory. The operational management of the company is the responsibility of the CEO, while the owners/managers (who control one-third of the company through their shares and options) are in charge of its strategic governance. Concorde Securities Ltd. is a member of the Budapest, Frankfurt, Warsaw and Bucharest stock exchanges, as well as of the Hungarian Association of Investment Service Providers.
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