WOOD Flash – Komercijalna Banka: 3Q20 – possible upside for our 2020E ROE estimate
Komercijalna Banka ad Skopje reported its stand-alone 3Q20 financials yesterday (29 October). We note that the bank reports its consolidated numbers only on a semi-annual basis; however, since the group is relatively small, we believe we can track the bank’s performance on a quarterly basis, and translate the trends and developments into the group level. The bank reported relatively strong numbers for the quarter. While the NII remained flat, the fees and commissions (F&C) improved vs. the previous quarter, good cost control resulted in a C/I ratio of 37% and, due to the high provisioning earlier in the year, the COR numbers improved as well. As the loan growth came to a standstill on a qoq basis, the loan book is still growing at mid-teen levels yoy. The continued strong deposit inflow resulted in a L/D ratio below 50% and, while we would like to see this ratio increasing going forward, we appreciate the bank’s conservative stance and its ability to keep TTM ROEs above 14%, despite such a low L/D ratio.
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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