Please find attached our banking sector update for 2023, in which we present: Sector Outlook, Hopes, Fears, and Picks * Sector Outlook, Hopes, Fears, and Picks * Valuation and Multiples Interbank Comparison * Market Share and Utilization * Balance Sheet * Income Statement * Capital Adequacy * Tax Law Calculation Individual Banks Fundamental Review * Commercial International Bank (COMI) * Qatar National Bank (QNBA) * Credit Agricole Egypt (CIEB)...
ROBUST MARGINS FAIL TO BOOST EARNINGS AS OPEX, PROVISIONS, AND EFFECTIVE TAX RATE SURGE SEQUENTIALLY; LENDING GROWS QNBA 3Q22 bottom line came in at EGP2,577 million (+1% q/q, +35% y/y), bringing 9M22 bottom line to EGP 7,332 million (+22% y/y). Annual growth was supported by robust margins that trickled down to the bottom line supported by non-interest income and lower OPEX despite a surge in provisions and effective tax rate. Sequential limited growth was caused by: 1) lower investment inc...
Higher RRR is negative, at face value, … On 22 September, the CBE hiked the reserve requirement ratio (RRR) on short-term LCY deposits by 4pp to 18.0% in effort to tighten liquidity and combat inflationary pressures. We calculate this should result in the absorption of cEGP150bn in excess liquidity from the system, which would be deposited at the CBE with no return. The RRR on FCY deposits was maintained at 10%. We expect banks will satisfy the higher liquidity requirement mainly through reducin...
Robust earnings and lower OPEX compensate for higher booked provisions; Strong balance sheet growth QNBA 1Q22 net profit pre-minority interest and appropriations recorded EGP2,208 billion (+28% q/q, +12% y/y), which is 3% lower than our estimates of EGP2,267 billion. 1Q22 bottom line strong growth came on the back of 1) a jump in 'other income' which is driven by translation gains of financials assets held in foreign currency, 2) healthy growth in net interest income and fees and commissions,...
HIGHEST SINGLE QUARTER PROVISIONS WIPE OUT HEALTHY OPERATIONAL PERFORMANCE; LDR DECLINES QNBA 4Q21 net profit pre-minority interest and appropriations recorded EGP1.62 billion (-15% q/q, -12% y/y), bringing FY21 bottom line to EGP7.63 billion (+1.8% y/y). The 4Q21 bottom-line annual and sequential decline was driven by record provisions ( more than tripling q/q to bring 2021 total provisions balance 6% higher than 2020 levels) and high effective tax rate, despite 1) solid maintained NIMs of 5...
QATAR NATIONAL BANK (EG), a company active in the Money Center Banks industry, reduced its market risk and raised its general evaluation. The independent financial analyst theScreener awarded an improved star rating to the company, which now shows 2 out of 4 possible stars; its market behaviour has improved and can be considered as defensive. theScreener believes that this new assessment merits an overall rating upgrade to Slightly Positive. As of the analysis date December 21, 2021, the closing...
Please find attached our banking sector update for 2022, in which we present: Sector Outlook, Hopes, Fears, and Picks * Sector Outlook, Hopes, Fears, and Picks * Valuation and Multiples Interbank Comparison * Market Share and Utilization * Balance Sheet * Income Statement * Capital Adequacy * Tax Issue Individual Banks Fundamental Review * Commercial International Bank (COMI) * Qatar National Bank (QNBA) * Credit Agricole Egypt (CIEB) * Hou...
HIGHER EXPENSES WEIGH DOWN ON PROFITS AMID STABLE MARGINS AND LOWER PROVISIONS; LDR DECLINES QNBA 3Q21 net profit pre-minority interest and appropriations recorded EGP1.91 billion (-10% q/q, +6% y/y), bringing 9M21 bottom line to EGP6.07 billion (+6% y/y). 3Q21 bottom line sequential decline and limited annual growth came on the back of 1) lack of growth of non-interest income, coupled with 2) higher other operating expenses (driven by insurance and software costs), and 3) higher effective ta...
Full Article at IIR has reaffirmed its Recommended rating for PIA after undertaking a review post the appointment of a new Portfolio Manager, Harding Loevner. The full report can be found on the IIR website. On 26 July 2021, Pengana International Equities Limited (PIA) announced a fully franked dividend of 1.35 cents per share for the June quarter. This represents an 8% increase on the March quarter dividend and takes the total dividends declared for FY21 of 5.1 cents per share, fully franked....
SOLID MARGINS, HIGHER NON-INTEREST INCOME AND STABLE PROVISIONS DRIVE BOTTOM-LINE GROWTH; LDR DECLINES QNBA 2Q21net profit pre-minority interest and appropriations recorded EGP2.13 billion (+8% q/q, +8% y/y), which is 3% higher than our estimates of EGP2.07 billion. 2Q21 bottom line growth came on the back of: 1) solid margins, 2) higher ‘other income’, and 3) sequentially stable provisions, despite higher opex and high but stable effective tax rate. Lending grew in 2Q21 by 2.0% while deposit...
WEAK MARGINS AND STABLE FEES RESULT IN MUTED OPERATING INCOME GROWTH; PROVISIONS SLIGHTLY LOWER QNBA 1Q21 net profit pre-minority interest and appropriations recorded EGP1.97 billion (+6% q/q, +5% y/y), which is in line with our estimates of EGP1.99 billion (our estimates were 1% higher). 1Q21 bottom line growth came on the back of a jump in 'other income', and lower provisions while margins and net fees and commissions declined. Lending grew marginally in 1Q21 inching up by 0.8% while deposi...
Hefty 4Q20 provisions wipe out annual growth and limits sequential growth; balance sheet shows no signs of growth in 4Q20 QNBA 4Q20 net profit pre-minority interest and appropriations recorded EGP1.85 billion (+3% q/q, -10% y/y) bringing FY20 bottom line to EGP7.5 billion, which is perfectly in line with our estimates and 12% lower than FY19 net profit of EGP8.5 billion. 4Q20 bottom line slight sequential growth came on the back of a strong non-interest income, and controlled opex. Hefty pro...
In our 72-page banking sector update for 2021, we present: SECTOR OUTLOOK, HOPES, FEARS, AND PICKS * Sector Outlook, Hopes, Fears, and Picks * Valuation and Multiples INTERBANK COMPARISON * Market Share and Utilization * Balance Sheet * Income Statement * Capital Adequacy * Tax Issue INDIVIDUAL BANKS FUNDAMENTAL REVIEW * Commercial International Bank (COMI) * Qatar National Bank (QNBA) * Credit Agricole Egypt (CIEB) * Housing and Developme...
Earnings decline on weak non-interest income and higher OPEX amid stable NIM and lower provisions QNBA 3Q20 net profit pre-minority interest and appropriations recorded EGP1.80 billion (-9% q/q, -20% y/y) bringing 9M20 bottom line to EGP5.64 billion, which is 13% lower than last year's 9M19 net profit of EGP6.46 billion. 3Q20 bottom line sequential weakness came on the back of a surge in other expenses despite stable operating income. Balance sheet expansion continued through 3Q20 with ROAE (...
Earnings wane on lower NIM and continued surge in provisions; Healthy balance sheet growth QNBA 2Q20 net profit pre-minority interest and appropriations recorded EGP1.98 billion (+6% q/q, -12% y/y) bringing 1H20 bottom line to EGP3.75 billion which is 9% lower than last year 1H19 earnings of EGP4.22 billion. 2Q20 bottom line sequential increase came on the back of a very weak first quarter dampened by precautionary credit impairment provisions coupled with high OPEX. However, 2Q20 still is co...
QNBA 1Q20 net profit pre-minority interest and appropriations came in at EGP1.87 billion (-9% q/q, -8% y/y). The annual and sequential decline were mainly caused by unusually high booked provisions in the first quarter of the year. We expect to see banks booking excess provisions in anticipation of lower asset quality as a result of the repercussions of the covid19 outbreak. ROAE (pre-minority and appropriations) recorded 22%. 1Q2020 results key takeaways were: * NIM strengthened to stand at...
We made a round of calls with the banks under coverage to get some color on their operations amid rising concerns of the current lockdown. Here are the main takeaways. · At the beginning of the year, banks had a strong growth outlook for the year with many soft approvals for CAPEX lending, up until the escalation of covid-19 in March. CAPEX lending has come to a complete stop, even with the surprise cut in rates by 300bps on March 16th. Working capital financing also weakened due to the inter.....
Update TPs; Among top sectors in 2020. As 2020 unfolds, we look for a pick-up in private credit activity, in line with further monetary easing by the CBE (excess liquidity release of up to EGP220-250bn and another 2-3% cut in policy rates). We roll over our valuations to 2020, raising our average TPs for our coverage by c5%. Additionally, we account for a 1% net profit deduction, in accordance with the Banking Act amendments (pending Parliament approval). Our numbers account for the income tax a...
No more Buys: US charges on Halkbank raise the prospect of a sustained period of negative headlines impacting one of Turkey’s largest lenders. There is a risk that this may continue long after Turkey’s current operation in northern Syria – Operation Peace Spring – comes to an end. We acknowledge that there have been concerns about potential charges on Halkbank for some time – we have discussed this ourselves in previous reports. However, the bank’s former deputy general manager was r...
Unfortunately, this report is not available for the investor type or country you selected.
Report is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.