WOOD Flash – Polish banks: powering through to higher ROE outlooks
The Polish MPC has raised the reference rate in Poland, to 50bps, up from 10bps previously. We see this as an outright positive for our current 2021-23E financial forecasts and potential price targets for the Polish banks, with our other model assumptions remaining unchanged. Therefore, we keep our positive view on the Polish banking sector, in light of market interest rates increases now looking to be more frontloaded and, on top of this, we believe it gives us some scope to also accommodate a higher average benchmark market interest rate in our 2023E financial forecasts, which affects the medium-term ROE outlook directly. In this quick flash note, we present our potential net profit forecasts, ROEs and valuations, which take into account a more bullish market interest rates outlook. The grounds of this were laid out in detail in our most recent report on the Polish banks.
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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