Svenska Handelsbanken (Buy, TP: SEK95.00) - Signalling Covid-19 resilience
We have raised our earnings by 8% for 2020e (leaving 2021–2022e largely intact) driven by lower loan loss estimates, and lifted our target price to SEK95 (93). We reiterate our BUY as we believe the market is still pricing in an overly negative financial impact from a Covid-19-driven economic downturn. We view the modest loan-loss provisions in Q1 coupled with management’s comments about stable asset quality as supportive for our overall positive sector view on Swedish banks at this early phase of the downturn.
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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