reports
- Elisabeth Rudman
- Maria Rivas Escrigas
- Vitaline Yeterian
UK Banks Resilient in the BoE Stress Test: Manageable Losses Supported...
DBRS Morningstar has released a commentary discussing the results of the latest stress test on the large UK banks published by the Bank of England (BoE). • This is the first cyclical scenario carried out by the BoE since 2019. We note that overall the 2022/23 stress test assumptions are broadly similar to the 2019 exercise and the Global Financial Crisis although generally tougher than current macroeconomic conditions. • The large UK banks demonstrated resilient results with all banks report...
- Elisabeth Rudman
- Maria Rivas Escrigas
- Vitaline Yeterian
UK Banks’ Q1 2023 Results Boosted by NII Growth, But Pressure on NIM E...
DBRS Morningstar has released a commentary discussing large UK banks’ Q1 2023 earnings, covering HSBC Holdings plc, Barclays PLC, Lloyds Banking Group plc and NatWest Group plc. Key highlights: • The four large UK banks showed significant improvement in profitability in Q1 2023 boosted by strong growth in net interest income reflecting the rising interest rates. • Higher revenues continued to offset the higher, albeit lower than during the pandemic, levels of loan loss provisions and high...
- Elisabeth Rudman
- Maria Rivas Escrigas
- Vitaline Yeterian
Manageable Impact From Debt Unrealised Losses for Large UK Banks; Robu...
DBRS Morningstar released a commentary on the potential impact of unrealised losses for large UK banks. Key highlights include: • UK banks have securities portfolios at amortised cost that represent a lower proportion of assets than for European Banks and SVB. • Under an extreme theoretical scenario that the large UK banks are required to sell their amortised cost bond portfolios, we view the negative impact on the banks’ CET1 would be modest and fully manageable, even when we assume a 10...
- Elisabeth Rudman
- Maria Rivas Escrigas
- Vitaline Yeterian
UK Banks: Solid Results in FY22 in Spite of Higher Loan Loss Provision...
DBRS Morningstar has released a commentary discussing large UK banks’ 2022 earnings, covering HSBC Holdings plc, Barclays PLC, Lloyds Banking Group plc and NatWest Group plc. Key highlights: • Overall, the large UK banks reported solid results in FY22 largely driven by a significant increase in net interest income (NII) reflecting the impact of higher rates, temporary pricing lags, as well as growth in the mortgage and commercial lending books. • At the same time, the uncertain economic envir...
- Elisabeth Rudman
- Maria Rivas Escrigas
- Vitaline Yeterian
UK Banks’ CRE: Some Deterioration But Contained; Impact of Higher Rate...
This commentary looks at the commercial real estate (CRE) sector for banks domiciled in the UK, and is based on publicly available data reported by the large UK banks rated by DBRS Morningstar (HSBC, Lloyds, Barclays, and NatWest or “the banks”) for their CRE portfolios. Key highlights: • The large UK banks have reduced their Commercial Real Estate (CRE) exposures in the UK both in absolute terms and as a proportion of UK lending over the past three years, while the overall CRE exposure in the...
- Charlotte Cervin
- Elisabeth Rudman
- Maria Rivas Escrigas
- Vitaline Yeterian
UK Banks 9M: Solid Results Reflect Strong NII Growth; But Negative Out...
DBRS Morningstar has released a commentary discussing large UK banks’ 9M 2022 earnings, covering HSBC Holdings plc, Barclays PLC, Lloyds Banking Group plc and NatWest Group plc. Key highlights: • Overall, the large UK banks reported solid results in 9M 2022 with higher interest rates supporting earnings. The return on average tangible equity was above 10% in 9M 2022 although not as strong as in 9M 2021 (13%). • Loan loss provisions were higher than expected reflecting the weakening macroecono...
- Elisabeth Rudman
- Vitaline Yeterian
- Charlotte Cervin
- Elisabeth Rudman
- Maria Rivas Escrigas
UK Mortgage Market: Banks and Borrowers Face Greater Uncertainty
DBRS Morningstar has released a commentary focusing on the increased uncertainty faced by UK banks and borrowers in terms of mortgage lending. Key points include: • The UK mortgage market suffered some disruption after the UK government’s mini budget on September 23, which is expected to lead to higher policy interest rates, led to a number of lenders temporarily withdrawing some mortgage rate products. • A significant part of the UK mortgage market is set to refinance within the comi...
- Elisabeth Rudman
- Vitaline Yeterian
- Elisabeth Rudman
- Maria Rivas Escrigas
- Vitaline Yeterian
UK Banks H122: Solid Returns, No Deterioration Yet in Asset Quality
DBRS Morningstar has released a commentary discussing large UK banks’ H1 2022 earnings, covering HSBC Holdings plc, Barclays PLC, Lloyds Banking Group plc and NatWest Group plc (the banks). Key highlights: • The banks reported solid results in H1 2022 reflective of higher revenues with all banks showing net interest income (NII) increases year-over-year (YoY), while the UK mortgage market has not showed signs of being significantly affected by higher rates. • The cost of living pressure cr...
- Elisabeth Rudman
- Maria Rivas Escrigas
- Vitaline Yeterian
UK Banks Q1: Solid Thanks to Higher Revenues; But Inflation and Cost o...
DBRS Morningstar has released a commentary discussing large UK banks’ Q1 2022 earnings, covering HSBC Holdings plc, Barclays PLC, Lloyds Banking Group plc and NatWest Group plc. Key highlights: • The banks generally reported solid net results in Q1 2022 thanks to higher core revenues which include higher net interest income driven by higher interest rates and sustained mortgage activity in the UK. • At the same time, the Russian invasion of Ukraine, lockdowns in Asia, and concerns over the...
- Elisabeth Rudman
- Maria Rivas Escrigas
- Vitaline Yeterian
UK Banks’ FY21 Results: Solid Returns Largely Driven by Loan Loss Reve...
DBRS Morningstar has released a commentary discussing large UK banks’ FY21 earnings, covering HSBC Holdings plc, Barclays PLC, Lloyds Banking Group plc and NatWest Group plc. Key highlights: • Large UK banks reported solid returns in FY21 mainly thanks to provision reversals. Income before provisions and taxes remained below FY19 levels on an aggregate basis. • Bank of England’s interest rate increase is supportive of UK banks’ net interest income which is the largest contributor to revenues....
- Elisabeth Rudman
- Vitaline Yeterian
Large UK Banks’ CRE in the UK Contained, But Weak Prospects For Retail...
This commentary looks at the commercial real estate (CRE) sector for banks domiciled in the UK, and is based on publicly available data reported by the large UK banks rated by DBRS Morningstar (HSBC, Lloyds, Barclays, and NatWest) for their CRE portfolios. • The large UK banks’ exposure to UK CRE has decreased over recent years on an aggregate basis, reflective of targeted reductions, while their average share of total CRE lending to total lending is in line with European peers’ average CRE le...
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