- Erste Group forecasts no growth in net interest income for the financial year.
- Return on tangible equity is expected to exceed 15%, a target that has remained stable.
- Cost of risk is projected to be below 0.2%, down from the previous target of below 0.25%.
- Fee and commission income is anticipated to grow by about 10%.
- Operating expenses are expected to rise by approximately 5%.
- Net loans are projected to increase by about 5%.
- The dividend per share is expected to be EUR 3, higher than the previous estimate of EUR 2.92.
- The Cost to Income Ratio is forecasted to stay below 50%.
Second Quarter Results
- Net income: EUR 846 million, beating the estimate of EUR 767.3 million.
- Net interest income: EUR 1.84 billion, slightly above the estimate of EUR 1.83 billion.
- Fee and commission income: EUR 711 million, surpassing the estimate of EUR 694.1 million.
- Revenue: EUR 2.73 billion, exceeding the estimate of EUR 2.69 billion.
- Pre-provision operating profit: EUR 1.44 billion, ahead of the estimate of EUR 1.38 billion.
- Cost to Income Ratio: 46.3%, better than the estimate of 48.5%.
- Net interest margin: 2.43%.
Comments
- CET1 ratio will enable enhanced capital return and provide flexibility for mergers and acquisitions.
Analyst Recommendations
- 16 buys, 5 holds, 2 sells.
A look at Erste Group Bank Ag Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 4 | |
| Dividend | 4 | |
| Growth | 5 | |
| Resilience | 2 | |
| Momentum | 5 | |
| OVERALL SMART SCORE | 4.0 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Erste Group Bank AG, a global bank based in Wien, Austria, shows a mixed outlook based on Smartkarma’s Smart Scores analysis. The company scores high in Growth and Momentum, indicating positive potential for expansion and an upward trajectory in the market. With a strong emphasis on value and dividend factors, Erste Group Bank AG also demonstrates stability and attractiveness for investors seeking long-term returns. However, the Resilience score of 2 suggests some vulnerability to market fluctuations or external challenges.
Overall, Erste Group Bank AG presents a promising long-term outlook, particularly in terms of growth and momentum, which could position the company favorably in the competitive banking sector. By focusing on maximizing value and dividends while addressing areas of resilience, Erste Group Bank AG aims to solidify its position as a reputable player in retail, corporate, and investment banking across Europe and beyond.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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