German Deutsche Bank maintained a “buy” recommendation on Greek banks while raising its target price from €9.85 to €10.15, noting the sector posted solid results in the third quarter of 2024.
The German multinational investment bank highlights Greek banks are in the position to manage a possible cut in interest rates by the European Central Bank (ECB) even if this occurs at a sooner-than-expected date.
The higher starting point for capital is expected to be offset later by stronger dividends and share buybacks, which are factored in alongside the accelerated amortization of Deferred Tax Credits (DTCs).
Deutsche Bank notes that the National Bank of Greece (NBG) delivered another robust performance in the third quarter of 2024, exceeding expectations overall due to strong core revenue growth.
NBG’s strong showing reinforces the bank’s full-year targets, offering further confidence in its continued solid delivery despite pressures from lower interest rates, Deutsche Bank underlines.
Deutsche Bank maintains its “buy” recommendation in light of these factors, citing positive trends and significant upside potential.
For Piraeus Bank, Deutsche Bank also increased its price target to €5.40 from €5.00, reflecting higher net earnings projections of +6% for 2024 and +2%/+1% for 2025 and 2026, respectively, as it adjusts its estimates for net interest income (NII).
According to the German bank, Piraeus Bank continues to deliver solid quarterly results, prompting upward revisions to its overall outlook. The bank has already surpassed its upgraded 2024 guidance for NII and provisions, driving further forecast adjustments.
Core revenues continue to surpass expectations, supported by resilient net interest income (NII) and strong growth in fees. NII posted a marginal increase quarter-on-quarter, driven by higher average volumes and securities income. This resilience was further bolstered by lower deposit costs, attributed to an improved mix and reduced hedging costs in Greece.
