Edison Investment Research - Banca Sistema (BST) Banca Sistema - Strong lending growth and capital position

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Edison Investment Research

Andrew Mitchell

Banca Sistema - Strong lending growth and capital position

Lending has grown by more than 40% year-on-year but mix changes and some lumpiness associated with late payment interest (LPI) have constrained earnings growth in 9M18. This effect should unwind as the business continues to grow. It would not require full delivery of the bankâ€™s three-year plan targets, including ROE of over 18%, to warrant a higher valuation. The capital position remains strong with a CET1 ratio of 11.1%.

07/11/2018 8 EN

Underlying

Banca Sistema

Banca Sistema SpA is an Italy-based commercial bank. The Bank primarily operates within the corporate segment. It specializes in providing factoring services to companies, including factoring with and without recourse, reverse factoring, credit management, value-added tax (VAT) receivables, maturity factoring, as well as receivables certification. Furthermore, its product portfolio comprises: current accounts, time deposits, medium-term loans and a range of guarantees for public bodies, urbanization costs, real estate exchanges, as well as for alternative energy businesses, among others. The Bank offers an online platform to facilitate customers the products management. It also provides a number of services within the retail area, such as savings and current accounts. The Bank operates branches in Italy and the United Kingdom. It operates through Beta Stepstone.

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IT0003173629 Italy

Provider

Edison Investment Research

Edison is an investment research and advisory company, with offices in North America, Europe, the Middle East and AsiaPac. The heart of Edison is our world renowned equity research platform and deep multi-sector expertise. At Edison Investment Research, our research is widely read by international investors, advisors and stakeholders. Edison Advisors leverages our core research platform to provide differentiated services including investor relations and strategic consulting.

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Analysts

Andrew Mitchell

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Banca Sistema - Strong lending growth and capital position

Banca Sistema S.p.A.: 1 director

Banca Sistema - A specialist lender growing in niche segments

Banca Sistema - A specialist lender growing in niche segments

Games Workshop Group - A notable acceleration in Q225

Altron - Further margin expansion in H125

Sayona Mining - Catching up with majors

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