We lower our 2020/2021 estimates by ~25% on higher loan loss provisions and a weaker growth outlook. Though a weaker NOK will help lending volumes in Q1 we think lower consumption (travel in particular) and a Finnish rate cap will lower growth medium term. Uncertainty remains high, but NOFI has a significant earnings buffer and a solid capital situation which should see them weather the storm. We reiterate Buy, but lower our 12-month TP to NOK 80 (113).
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Tough times ahead, but NOFI should manage
- Published:
08 Apr 2020 -
Author:
Roy Tilley -
Pages:
15
We lower our 2020/2021 estimates by ~25% on higher loan loss provisions and a weaker growth outlook. Though a weaker NOK will help lending volumes in Q1 we think lower consumption (travel in particular) and a Finnish rate cap will lower growth medium term. Uncertainty remains high, but NOFI has a significant earnings buffer and a solid capital situation which should see them weather the storm. We reiterate Buy, but lower our 12-month TP to NOK 80 (113).