EU FINANCIALS: {GR}{3H} National Bank of Greece (ETEGA) - Q4 Results
Credit neutral. Slightly behind expectations but still reasonably solid. ETEGA still 18bps wide than average Eur banks in Sr pref space and 45bps wider in tier 2. Continued solid results can help convert the positive outlooks at Moodys and Fitch and narrow this gap.
- *NATIONAL BANK OF GREECE FY NET INTEREST INCOME EU2.36B
- *NATIONAL BANK OF GREECE FY NET INCOME EU1.16B, EST. EU1.26B
Q4 NII of 575m is -2% QoQ. Fee income of €115m is 6% higher.
- 2024 OpEx is 6% higher at €884m
- Impairments of €64m is slightly above the 2024 run rate, and up €13m QoQ. NPLs continue to decline, now at 2.6%.
- CET1 up 0.5% in 2024. 3.2% capital generation, -1.4% RWA increase and -1.5% payouts.
- QoQ Performance - Greek sr prefs performed in line with the broader market c-17bps. ETEGA's tier 2s outperformed the broader market but didn’t do as well as those of EUROB or ALPHA.
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RIKSBANK: Cuts Rates 25bp Unanimously, No Clear Forward Guidance
The Riksbank cut rates by 25bp to 2.25% as widely expected, in a unanimous decision amongst the Executive Board. There was some speculation that Deputy Governor Seim and Governor Thedeen may have opted to keep rates on hold, following cautious tones in the minutes and subsequent comments. The policy statement did not contain any clear forward guidance for the rest of this year, as we had expected in our preview.
Highilghts from the policy statement:
- “The forecast for the policy rate made in December essentially holds, but the Executive Board is prepared to act if the outlook for inflation and economic activity changes”.
- No clear forward guidance: “Monetary policy is forward-looking and guided by a tentative approach. The Riksbank will carefully evaluate the need for future interest rate adjustments, in light of the effects of earlier cuts and other information relevant to the outlook for inflation and economic activity”.
- “There is particular uncertainty regarding developments abroad, for instance with regard to economic policy in the United States and Europe and the geopolitical tensions.”
MNI: RIKSBANK CUTS KEY POLICY RATE 25BP TO 2.25%
- MNI: RIKSBANK CUTS KEY POLICY RATE 25BP TO 2.25%
EQUITIES: Luxury counters Tech, some focus on the Bank Index.
- Not quite a new record high for the Cash Estoxx as it would need a test up 5260.00, now at 5239.00, the luxury sector is countering the spike in Tech, and no surprises in seeing the Tech sector up 4.28% in early trade following ASML Earning beat.
- The Bank index (SX7E) one of the more interesting chart in early 2025 is testing Yesterday's high at 161.70.
- Main upside initial target resides at 163.34, the 2014 high, and the highest printed level since July 2011.
(Chart source: MNI/Bloomberg).
