- Return on Tangible Equity (ROTE): Erste has raised its full-year guidance and now expects a ROTE above 15%, compared to the previous estimate of around 15%.
- Cost of Risk: The bank anticipates a cost of risk around 0.2%, which is an improvement from the previous estimate of approximately 0.25%.
- Net Interest Income (NII) Growth: Erste foresees net interest income growth to be above 0%.
- Fee and Commission Income Growth: The bank expects an increase in fee and commission income of over 5%.
- Operating Expense Growth: Anticipated at about 5%.
- Net Loans Growth: Erste projects growth in net loans to be above 5%.
- Second Quarter Results:
- Net Income: €921 million, an increase of 8.9% year-over-year, surpassing the estimate of €818.3 million.
- Net Interest Income: €1.91 billion, reflecting a year-over-year growth of 4.3%, above the estimated €1.86 billion.
- Fee and Commission Income: €762 million, slightly below the estimate of €768 million.
- Total Revenue: €2.87 billion, a year-over-year rise of 4.8%, exceeding the estimated €2.81 billion.
- Pre-Provision Operating Profit: €1.51 billion, growing 2.5% year-over-year, above the estimate of €1.46 billion.
- Cost to Income Ratio: 47.7%, slightly better than the estimated 48%.
- Net Interest Margin: Increased to 2.41% from 2.33% quarter-over-quarter.
- Provision for Loan Losses: €97 million, compared to €31 million year-over-year, lower than the estimated €104.7 million.
- Analyst Recommendations: 17 buys, 5 holds, and 1 sell recommendation.
A look at Erste Group Bank Ag Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 3 | |
| Dividend | 4 | |
| Growth | 4 | |
| Resilience | 3 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.6 |
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
In analyzing the long-term outlook for Erste Group Bank AG, the Smartkarma Smart Scores reveal a promising future for the company. With above-average scores across key factors, Erste Group Bank AG is positioned well for growth and stability in the banking sector. Notably, the company received a strong score for dividends, indicating a solid potential for consistent returns to investors. Alongside this, high scores in growth and momentum suggest a positive trajectory for the company’s expansion and market performance. Despite facing some challenges as indicated by a lower score in resilience, the overall outlook remains optimistic for Erste Group Bank AG.
Erste Group Bank AG, a global bank with a strong presence in Europe, demonstrates a balanced performance across various financial metrics. This is evident in its Smartkarma Smart Scores, where the company shows strength in areas such as dividends, growth, and momentum. Operating in retail, corporate, and investment banking sectors, Erste Group Bank AG is well-positioned to capitalize on opportunities for future development and profitability. With its headquarters in Wien, Austria, the company’s strategic location and diverse operations contribute to its overall resilience in the market, despite some areas for improvement.
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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