WOOD Flash – Greek banks: EBA parameters provide more clarity
Yesterday (31 January), the European Banking Authority (EBA) published the key macroeconomic assumptions that will be used in the stress test for the Greek banks over the next three months (we expect the results to be out in early-May). In our view, the GDP and unemployment assumptions in the adverse scenario are milder than the 2015 exercise; however, on the negative side, the fall in real estate prices in the adverse scenario appear quite steep, even when compared to the 2015 exercise (with commercial real estate prices falling even more than the 2015 stress test).Our opinion remains that all Greek banks should manage to survive the stress test exercise without a capital action. However, the test may not be a walk in the park, and we therefore continue to prefer the banks with stronger capital positions (Alpha and NBG). Our best pick is Alpha Bank (BUY, PT EUR 2.5/share) due to its best-in-class CET1 ratio (17.7% in September 2017, with further upside from GGB tightening), low valuation (trades in line with Eurobank, but at a good discount to NBG) and good prospects, in 2018E, of reversing the soft NPL trends seen last year.
Eurobank Ergasias and its subsidiaries are organized in the following reportable segments: Retail. which incorporates customer current accounts, savings, deposits and investment savings products, credit and debit cards, consumer loans, small business banking and mortgages; Corporate, which incorporates direct debit facilities, current accounts, deposits, overdrafts, loan and other credit facilities, foreign currency and derivative products; Wealth Management, which incorporates private banking services; Global and Capital Markets, which incorporates investment banking services; and International, which incorporates operations in Romania, Bulgaria, Serbia, Cyprus, Ukraine and Luxembourg.
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.