Romanian Banks: building resilience (Banca Transilvania downgraded to HOLD, BRD-GSG stays HOLD)
The Romanian banks should remain resilient in 2023E, in our view, despite the challenging global macro. Higher rates and solid loan growth could largely offset cost pressures and a higher cost of risk, leading to strong ROTEs of c.20%, on our estimates. The healthy fundamentals are, however, in our view, reflected already in the current valuation levels, with both banks trading at c.1.3x P/TBVs on our 2022E. Banca Transilvania (downgraded to HOLD (from Buy), new price target (PT) RON 20.2/share) remains our best pick among the two Romanian banks, as it is cheaper than BRD-GSG (stays HOLD, new PT RON 12.8/share), with a better growth story and a stronger ROTE profile.
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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