Piraeus announced it targets 10% RoTE by 2024: Based on -10% NII, +40% fees, +70% other income, -12% cost cutting and -50% impairments vs. 2020 – or a normalized CoR of 70bps. The bank seems comfortable operating at 8%-9% fully loaded CET1 in 2021-2022 in order to get rid of E21bn of NPEs in the next 12 months. Achieved via Hercules securitizations (E18bn, o/w E7bn completed), outright sales (E1.4bn) and organic actions (E3.5bn) – slightly offset by inflows of E1.7bn including pandemic related ones. Management confirmed it will be raising E1.0bn of equity within April via a book-building process; new shares (issue price unknown) to commence trading in May. Combined with bond gains of E400m, merchant card sale gains of E300m and organic earnings of E1.4bn (2021-2024) to absorb P&L/equity losses of E4.0bn from NPE reduction.
Reconciling RoTE targets with P&L earnings we infer net income is guided at c. E600m in 2024 on TBV of c.E6.0bn. The above imply shares currently trade…

Weak benchmark refining margins QTD imply Q1 will be another bad quarter; gasoline/diesel/jet cracks are significantly down yoy while USD has weakened further; and pandemic recovery remains fragile. We cut our 2021 EBITDA estimate by…

Eurobank is guiding for 2022 RoTE of c.10% implying net income of E550m (against a market cap of E2.4bn) on normalized NPE% and CoR at 6% and 60bps respectively. So far this is the most optimistic/bullish business plan in the GR banking sector and one of the most bullish ones in EUR. It implies the fair P/TBV 2022 is close to 1.0x (on 10%-11% CoE) compared to 0.43x TBV 2022E (current price, Eurobank’s guidance) or EUR banks 0.70x-0.75x. The implied upside means that if you buy these targets you should also go ahead and buy the stock.
In our analysis, we attempt to deconstruct the RoTE and other KPIs guidance provided into P&L, Balance Sheet and Asset quality items. Our conclusion…

In conclusion OWN IT before Jumbo proves again its successful business model in all countries of operation. We expect the shares to move closer to our target price of…

Piraeus Bank announced the completion of Vega NPE E4.9bn securitization. As was the case with Phoenix, Intrum AB will buy 30% of mezzanine notes, 5% will be retained by the bank (along with 100% of senior notes) and 65% will be distributed to shareholders (we assume via a listing similar to Cairo Mezz). Based on disclosed numbers and metrics we present our calculations and thoughts…