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Research Tree provides access to ongoing research coverage, media content and regulatory news on BANCO POPULAR ESPANOL. We currently have 4 research reports from 1 professional analysts.
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BANCO POPULAR ESPANOL
BANCO POPULAR ESPANOL
Quarters follow one another and look alike
28 Oct 16
Like in the previous quarter, the group posted no profit in Q3, in line with its objective to devote all its pre-provision earnings to increasing the NPA coverage this year. The bulk of the effort will be made in Q4 with consensus (and AV) expecting around €2.5bn of losses. Management changed its earnings presentation, separating core and non-core assets. Unfortunately, this resulted in an unwelcomed reduction in data disclosure.
The capital increase does not solve everything
30 May 16
The group has launched an unexpected €2.5bn rights issue with pre-emption rights at a €1.25 issue price. The operation will enable the group to align its NPA coverage with its peers and thus to enjoy a similar trajectory in terms of asset quality, cost of risk and profitability normalisation. Above all, the group will comply with the Bank of Spain’s new circular. However, we see the capital increase as under-calibrated leaving some equity shortfall and above all, the group’s structural profitability issue remains un-addressed.
EPS cuts on lower trading income generation
17 May 16
The first quarter results showed top-line pressure driven by the strong competition on SMEs loans and the market’s turmoil. The rapid normalisation of trading income generation expected over the coming quarters will not help. Although the reduction in operating costs is on track with the balance sheet downsizing, the cost of risk normalisation continues to be seen as only very progressive in spite of a confirmed reversal in asset quality trends. As a positive, the ongoing capital generation should enable the group to rapidly meet its equity requirements.
Top line pressure, limited visibility on cost of risk lever
03 Feb 16
Quarterly results suffered strong competitive pressure and elevated cost of risk. The cost of risk normalisation is a major profitability lever but visibility on the pace of reduction remains low, especially if the current global turmoil and the domestic political instability turn into economic slowdown.
Mobilising the strategy
08 Dec 16
PCF has reported a good set of FY16 figures this morning. Pro forma 12 month adjusted pre-tax profit increased 38% YoY to £4.0m (FY15: £2.9m), 5% ahead of our estimate of £3.8m. Fully diluted return on equity remained broadly stable YoY at 13% but beat our forecast of 12.6%, driven by good loan book growth, up 14% YoY to £122m. Given the strength of the results the board has reinstated a dividend of 0.1p per share. Following Tuesday’s announcement of the approval of a banking licence, we believe that the group now has the capacity to accelerate its growth prospects. While the shares trade at 12.0x earnings and 2.0x reported book value, we do not believe this valuation captures the growth potential of the business.
VPC Speciality Lending Investments PLC – sticking to your knitting pays dividends
05 Dec 16
A 25% discount on a dividend paying vehicle suggests either (a) lack of belief in the NAV, (b) lack of belief in the dividend, (c) concerns over future delivery, (d) a shareholder’s base not normally exposure to “closed end structures” or (e) some combination of (a) to (d). We had a first meeting with the management team and London representative of VPC Speciality Lending to try to better understand why the share price had fallen quite so much.
Small Cap Breakfast
07 Dec 16
Creo Medical group—Schedule 1 update.. £20m raise. Expected market cap £61.2m, admission expected 9 December. ECSC—Schedule 1 from provider of cyber security services. Raising £5m. Vendor sale £0.8m. Target date 14 Dec. Expected market cap £15m. RM Secured Direct Lending - The secured direct lending fund intends to float on the Main Market on 15 December raising up to £100m
Better Capital – A tale of two funds
05 Dec 16
Our gut feel on the results is that BCAP’s Gardner disposal feels viable (albeit as a late Q1 transaction). Post Gardner, the exit profile for BCAP’s portfolio is slanted towards the years 2018/19 and not earlier; we view the market’s current pricing as cautious (14% disc to our estimate of FV). In contrast, BC12’s more consumer facing portfolio remains a work in progress and may well offer further disappointment before turning a corner; the market valuation (51% discount to NAV) is cautious but probably fair given the difficulties.
Panmure Morning Note 07-12-2016
07 Dec 16
PCF today announces that it has succeeded in achieving once its major strategic goals by being granted a UK banking licence. In line with prior guidance, the company aims to begin taking deposits in summer 2017 and will initially focus on lending to its core markets in consumer motor finance and SME asset finance. As well as supporting growth in the loan book, the banking licence will both diversify and reduce the cost of its funding base. More details are expected as part of the FY16 results tomorrow.
Meeting near-term headwinds
06 Dec 16
In its trading update IFG reported that performance has been in line with management expectations. The cooling effect of market uncertainty on growth in James Hay and financial advice client numbers, together with the impact of low interest rates, remain a near-term head wind for revenues. Even so, with Saunderson House continuing to increase profits, IFG expects to match 2015 earnings. The long-term growth opportunity presented by an ageing population and pension freedoms remains in place and to address this IFG is continuing investment to enhance its service and increase operational gearing.