WOOD Flash – Bank Pekao: 2025-27E strategic targets
Yesterday (14 April), after the market closed, Bank Pekao published its 2025-27E strategic targets. The bank is targeting a minimum 18% ROE, with a maximum 35% C/I ratio and the COR falling into a range of 65-75bps. The dividend policy has been kept unchanged with regards to the targeted payout ratio, in a range of 50-75%, conditional on significant changes in RWA growth, pending meeting the regulatory requirements and receiving the watchdog’s consent. The strategy is based on three pillars: (i) growth; (ii) accessibility; and (iii) efficiency. We see the published strategic ROE target as implying a potential positive consensus revision cycle, as current consensus 2027E ROE lands at 15% currently. It is also ahead of our forecast of a 17% ROE and we see some upside for our current forecasts. Our current 2027E net profit forecast is at PLN 6.4bn and, if our 2025-27E earnings trajectory is right, and the dividend payouts land at the midpoint of the declared dividend range, we see a 2027E net profit ambition of a minimum of PLN 6.7bn, implying a P/E ratio of just 6.6x. However, at the lower end of the dividend payout ratio, Bank Pekao may be eyeing PLN 7bn+ of 2027E net profit.Bank Polska Kasa Opieki (the Bank) is a commercial bank providing a range of banking services, mainly in Poland. The segments of the Bank are as follows: Retail banking, which comprises all banking activities related to retail customers and small and micro companies; Private banking, which comprises all banking activities related to the affluent individual customers; Corporate and Investment banking, which comprises all banking activities related to the companies, interbank market, debt securities and other instruments; and Assets and Liabilities Management and other, which is engaged in the supervision and monitoring of fund transfers, and other activities centrally managed.
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