As discussed in our report, A worse-than-expected slowdown (21 Jan), CBG’s pre-close trading update disappointed, guiding to a sharply lower Winterflood contribution, weak loan growth and slightly elevated impairments. As such, we are not unduly surprised that CBG has been (by far) the worse performing UK-headquartered bank in 2022 year-to-date (Fig 1, page 2), and the shares have now de-rated from 2.5x tNAV in FY15 to 1.3x FY22e (Fig 2, page 2). Sharply lower trading volumes at WInterflood are now guided to trigger a c.70% YoY decline in the Securities division contribution in H1 FY22 (Fig 3, page 3). The performance and outlook of the Asset Management division remains positive (Fig 4, page 3) but this is too small to “move the dial”. The Banking division is a “mixed bag”. Encouragingly, NIM “remained strong” (FY21: 7.7%). Also, perhaps unsurprisingly, the “underlying credit performance of the loan book was strong”, but guidance to an annualised bad debt ratio of c.1.1% in H1 FY22 reflects a further (hopefully non-recurring) charge in relation to the Novatis loan book which is already in run-off. We expect Banking PBT to reach a new high by FY24e (Fig 5, page 4) despite a slowing pace of loan growth; we model 6%/3%/3% through FY22/FY23/FY24e (Fig 6, page 4). In aggregate, although we forecast a small decline in profits in FY22e (Fig 7, page 5) due to a sharp “normalisation” of the Securities division contribution, we see reasonable underlying momentum. Our EPS forecasts of 125.5p/135.9p/140.3p imply strong coverage for DPS of 66p/72p/78p through FY22/FY23/FY24e (Fig 8, page 5), a prospective FY24e dividend yield of 6.2%. CBG boasts a strong capital position; a CET1 capital ratio at 31 Dec 2021 of 15.7% vs a minimum regulatory requirement of 7.6% (Fig 9, page 6). On 1.3x FY22e for ROTEs of 13.6%/13.9%/13.5% in FY22/23/24e (Fig 10, page 6), we upgrade to Buy (from Hold). TP cut to 1430p (from 1510p).