4Q16 – higher provisions, core revenue lines in line, capital ratios below 2016E dividend requirements
ING has posted net profit of PLN 255m for 4Q16 (-23% qoq, +24% yoy), 9% below our estimate and 6% below the market consensus. The main reason for the miss was higher provision charges (PLN 139m vs. PLN 50m in 3Q16) than we had expected. Admin costs were also slightly above our expectations (+8% qoq, -14% yoy). Overall, we read the results as slightly disappointing. The core revenues were in line with expectations, but provision charges were high, even adjusted for one-offs. In our view, there is a risk that the bank will not pay out a dividend from its 2016E net profit as its Tier 1 ratio is below the regulator's requirements. On a positive note, we highlight the strong improvement in the F&C result.
WOOD & Company is the leading investment bank in Emerging Europe. Founded in 1991 and head-quartered in Prague, our footprint spans the region and touches investors around the globe.
A pioneer in Emerging Europe, WOOD executed many of the first CEE equity trades and landmark investment banking transactions. Our electronic trading platform was the first in the region, and remains the best. We are continually expanding our relevance and reach in these ever-evolving markets.
Our equity market share reflects our stature: 7% in Warsaw, 20% in Bucharest, 16% in Hungary, 40% in Prague and 5% in Vienna. Our distribution is unparalleled, with the largest salesforce in the region, servicing a uniquely diverse investor base.
We couple local expertise with a truly international perspective. With offices on the ground in the region, and in key financial hubs such as London and Milano, we are never far from our clients and we remain at the forefront of what’s afoot in the CEE emerging and frontier landscape.
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