On Tuesday, Deutsche Bank (ETR:DBKGn) updated its outlook on National Bank of Greece SA (ETE:GA) (OTC: OTC:NBGIF), increasing the price target to EUR10.15 from the previous EUR9.85, while reaffirming a Buy rating on the stock. The adjustment follows the bank's third quarter results for the year 2024, which showcased a strong performance, beating expectations in several areas except for costs.
The bank's robust core revenues were highlighted as the primary driver for its impressive results. This outcome not only meets but also potentially exceeds the full-year targets set by the bank, suggesting a positive outlook and instilling confidence in its ability to maintain strong performance. This is significant, especially considering the challenges posed by lower interest rates in the market.
Furthermore, the successful placement of a 10% stake previously held by the Hellenic Financial Stability Fund (HFSF) has seemingly reduced the overhang risk for the bank's shares. The analyst noted this development as a positive step toward stabilizing the bank's stock value.
Another contributing factor to the positive assessment is the acceleration of Deferred Tax Credit (DTC) amortisation, along with a Common Equity Tier 1 (CET1) ratio that is expected to be close to 20% on a pro forma basis. These elements are indicative of a strong capital position and pave the way for a more favorable view on the potential for capital return to shareholders.
The analyst concluded that given the combination of these factors, including the positive trends and the significant upside potential, the Buy rating for National Bank of Greece remains warranted. The bank's performance supports the analyst's outlook and suggests continued strong delivery from the financial institution.
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