4Q16 – small beat due to higher trading income; 2016-17E dividend recommendations
Komercni Banka has posted net profit of CZK 3,049m for 4Q16 (-23% qoq, +6% yoy), 1% above our expectations. The beat vs. our estimates was driven by higher trading income. On the other hand, the NII (flat qoq, -1% yoy) and F&C result (-5% qoq, -9% yoy) were below both our and the market’s expectations. Furthermore, provision charges (+36% qoq, -6% yoy) and admin costs (+6% qoq, -6% yoy) were higher than we had expected. Overall, we read the results as uninspiring due to the miss on the key revenue lines. However, we appreciate management’s declaration on dividends from both the 2016 and 2017E earnings. ÂKomercni banka is a universal banking group based in the Czech Republic. Co. is engaged in the provision of a range of financial services in retail, corporate and investment banking. Co.'s operating segments include: Retail Banking, the provision of products and services to individuals, such as among others building savings, pension insurance, overdrafts, credit card and personal loans and mortgages; Corporate Banking, the provision of products and services to corporate entities such as foreign currency and derivative products, syndicated and export financing, and guarantee transactions; and Investment Banking, which involves trading in financial instruments.
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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