WOOD Flash – Sberbank: 4M20 RAS results – our read-across for IFRS 2Q20E
Sberbank has announced RUB 11bn in net income in its April 2020 RAS results. The NIM in April was stable compared to the 1Q20 average. Fees seem to have started to losing significant momentum, which was expected. Opex growth is very subdued in the RAS results, but there is no read-across for the IFRS numbers here. We believe that the C/I outlook could worsen this year, with around 7% cost growth in IFRS. 2Q20E does not seem to have started with a significantly different COR trend compared to our 2.7% all-in COR estimate for 2020E. As the bank indicated previously, the CET1 got around 60bps in April on the back of the Basel 3.5 implementation. We are sticking to our HOLD rating for Sber, as we believe the stock does not offer compelling upside from the current levels. Sber’s commons trade at 1x P/TBV and 9.1x P/E, on our 2020E estimates. We published a downgrade report on Sberbank yesterday (12 May).Sberbank Russia is an open joint stock commercial bank. Co.'s principal business activity is corporate and retail banking. This includes, but is not limited to, deposit taking and commercial lending in freely convertible currencies, local currencies of countries where the subsidiary banks operate and in Russian Roubles, support of clients' export/import transactions, foreign exchange, securities trading, and trading in derivative financial instruments. Co.'s operations are conducted in both Russian and international markets. As of Dec 31 2014, Co. had total assets of RUB25.20 trillion.
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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