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The National Bank Of Kuwait: 1 director
A director at The National Bank Of Kuwait sold 3,005,000 shares at 0.877KWD and the significance rating of the trade was 69/100. Is that information sufficient for you to make an investment decision? This report gives details of those trades and adds context and analysis to them such that you can judge whether these trading decisions are ones worth following. Included in the report is a detailed share price chart which plots discretionary trades by all the company's directors over the last two...
- Sara Boutros
- Sherif Eletr
Kuwait banks | Selectivity mode on; NBK – sole OW
Medium-term optimism holds. Pickup in GDP growth, policy rate hikes, and moderating CBK provisioning requirements are among the main factors shaping the outlook for Kuwait banks through end-2023e – together these translate into favourable growth and profitability prospects for banks. That said, Kuwait banks trade at, or close to, their all-time-high levels, implying these upside risks are already largely captured, rendering selectivity as the preferred approach.Single out NBK. We flag NBK as the...
- Rahul Shah
National Bank of Kuwait: Q3 20 results — Downgrade to Sell on challeng...
With NBK’s 9M 20 profit falling 44%, and further NPL formation likely following the end of the 6-month consumer loan moratorium, we take a more cautious view on the shares, which we now rate as Sell. At our new target price of KWD0.75, we see around 10% downside to the shares. Our new forecasts are presented at the end of this report. VALUATION We price the shares off a mid-cycle ROTE of 13.5%, a cost of equity of 11.0% and terminal growth rate of 5.0%. At our target price of KWD0.75, the sha...
- Rahul Shah
- Rohit Kumar
EM Banks: Funding fresh credit looks most challenging in these markets
Across the world, banks are being asked to take on much of the burden of easing the pain of Covid-19 lockdowns, by offering loan maturity extensions, interest holidays and cheaper credit. Borrowers with access to undrawn credit facilities may also exercise their rights, particularly if alternative sources of finance dry up. At the same time, given an uplift in unemployment and with selected companies struggling to meet their working capital requirements, some savers may withdraw deposits to m...
- Rahul Shah
Kuwait: Bank dividends – still everything to play for
NBK and a host of other Kuwaiti banks have today published clarifying statements on the Boursa Kuwait website following news reports yesterday that implied that the Kuwaiti Banking Association had asked their members not to pay cash dividends for FY2020. The banks’ stock exchange statements indicate the following: 1. The Central Bank of Kuwait has previously announced a raft of Covid-19-combatting measures as part of its Regulatory Stimulus Package, including the reduction of the Capital Ade....
- Aya Abdellah
- Monsef Morsy
- Sara Boutros
Solid franchise, further rerating ahead; Maintain Overweight
Favourite name among Kuwaiti banks. NBK is a clean, well-funded, efficient bank, with strong corporate brand and government ties. The bank has exposure to the fast growing, highly profitable Egyptian market, as well as Islamic operations in Kuwait. We expect NBK to continue delivering healthy growth rates (2020-23e CAGR: +12.7% in net income, +8.3% in net loan), as CoR levels ease (80-85bp-s vs. 100bps+ historically), creating a buffer against NIM compression and upward pressure on operating cos...
- Rahul Shah CFA
- Rohit Kumar
GCC Banks: Q2 19 results round-up – UAE banks preferred
Time to rotate into UAE banks. Monetary policy will likely shift from a support to a drag for GCC banks, with the US Fed widely expected to cut rates this week. This could limit appetite for the most highly-rated markets such as Saudi and Kuwait banks (Figure 5). Potential easing of foreign ownership limits in the UAE could drive passive inflows that have been the principal price drivers in the region in recent years. UAE banks are also typically less aggressively priced than their neighbours (T...
- Rahul Shah CFA
National Bank of Kuwait: Q1 19 results in line. A welcome fall in cred...
NBK reported Q1 19 net profit to shareholders of KWD107.7mn, in line with our forecast of KWD107.9mn but above Bloomberg consensus of KWD103.5mn. Pre-provision profit was weaker than expected (lower core revenues and higher operating costs) but this was offset by a 33% yoy decline in credit risk costs. We maintain our Hold rating and KWD0.95 target price.
- Aya Abdellah
- Monsef Morsy
- Sara Boutros
Kuwait banks | Interesting value proposition; Favour KFH, NBK
Well-positioned in current macroeconomic backdrop. We view Kuwait positively, given its: i) eyed consumption recovery in 2019 (+3.5%) and continued growth in non-oil GDP (+3% in 2019-20e, double its 5-year historical average), ii) relatively low fiscal breakeven oil price (USD50/bbl, c30% discount to GCC average), iii) healthy financial buffers through KIA, safeguarding spending, and iv) prospect MSCI inflows, on the potential upgrade to EM in May-19 (likely to represent 0.3% of EM index, bringi...
- Rahul Shah CFA
National Bank of Kuwait: Likely performance improvements already price...
FY 18 results in line, but dividend was better. National Bank of Kuwait reported net profit attributable to shareholders of KWD370.7mn, up 15% yoy and in line with our estimate (KWD370.3mn). A recommended dividend of KWD0.035 was slightly above our KWD0.033 estimate. Although revenues were slightly weaker than expected, this was offset by better cost control and credit risk costs. We roll forward our estimates to 2023, and accordingly raise our TP to KWD0.95 from KWD0.86.
- Rahul Shah CFA
National Bank of Kuwait: Q3 profit falls short, but underlying data in...
Net profit below our forecast on investment loss. Headline profit attributable to shareholders was KWD86.5mn (+17% yoy), below our KWD96.1m estimate and the Bloomberg consensus of KWD90.5mn. The key driver of the shortfall was a KWD5.0mn loss on the reclassification of an associate investment.
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