We have not become structurally positive but we are meeting the Greek government halfway in its U-turn towards implementing the adjustment program; we assign an OWN IT rating on Eurobank (0.39x TBV 2016E)– the only Greek bank with upside (+30%) from current levels based on RoTE/CoE implied P/TBV valuation without accounting for future capital returns. It…
ECB CA 2015 results (AQR + 2.5YRS stress tests) revealed a capital shortfall of E4.4bn (baseline) and E14.4bn (adverse); hardly a surprise given latest speculation in the press and overall expectations; Alpha and Eurobank scored better and theoretically enjoy an easier task accessing private investors; their equity proposition at baseline (2017) 0.39x TBV/2.5x PPP and…
In this RG F4T we focus on the recapitalization of the Greek banks. Our aim is to outline the most important aspects of this process which authorities aim to complete by year-end and before the bail-in directive kicks in. As per most recent press stories the recap amount will not exceed E15bn – i.e. much…
Stress test assumptions have not been disclosed yet therefore we are assessing banks’ capital needs using our own AQR (NPE & Collaterals), PPP (mitigating) and DTC (cap % TBV) scenario. Alpha and National screen best (expected). We believe banks should exploit the full E25bn recap money as the second best thing to a bad bank…
With ELA maintained at Friday’s level the Greek government had to impose capital controls and keep banks closed until after the referendum takes place. The Greek economy has entered unchartered territory but we are certain economic activity will freeze. In this context we are withdrawing our ratings (previous DOI) and target prices on Greek banks….