Erste Group 1Q 20 - 1Q in line, but what does the management say?
1Q earnings fared better than our estimates, but were in line with consensus. Solid core earnings and lower COR were offset by a negative trading/FV result with deteriorating capital ratios as the weak spot. Loan growth was still up 6.4% yoy (+0.7% qoq, higher in local currency terms) and deposit build-up remained very strong at 9.3% yoy/4.5% qoq. NII was flat qoq (ahead of our expectations) with NIM flat yoy at 2.18% and RO&SK NII offsetting decline in CZ and AT. F&C also came in stronger than expected (mainly in AT and CZ, weaker in RO), but trading/FV result was significantly negative (EUR -120 mn) on valuation effects of debt securities.Erste Group is a financial services provider based in Austria. As of Dec 31 2015, Co.'s total assets amounted to Euro199,743 million and the number of customers was approximately 16.5 million. Co.'s key business is the retail business, covering the entire spectrum from lending, deposit and investment products to current accounts and credit cards. In addition to providing financial services to private individuals, Co.'s core activities also include advisory services and support for corporate clients in financing, investment and access to international capital markets, public sector funding and interbank market operations.
The Institutional Equity Research team of Raiffeisen Bank International AG covers 85 stocks from Austria, Central & Eastern Europe with sell-side research and thus levers our local broker status with excellent company relationships. For corporates in Austria, CEE and Western Europe, we offer co-sponsored research, which includes research coverage and marketing activities to investors. Additionally, through our Spotlight Research product we also shed light on leading European small and micro-caps, seeking greater visibility with investors.
The Institutional Equity Research team consists of roughly 15 analysts, both in Vienna and the CEE countries. Our analysts provide long-standing sector expertise in tandem with profound local market know how and a sectoral approach across the entire region.
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