11th consecutive quarterly result
- with European banks beating analysts' consensus.
- 80% of banks delivered net results in line with or above consensus.
Earnings momentum still positive
- FY24e pre-provision profits upgraded by 2%-3% on an aggregate level post results
- 2023e net income growth of c. 40% vs. 2022
- Index aggregate ROE close to 12% for 2023e (vs. last decade peak of 8%
Contrasts are starting to emerge
- NII in the Euro area was up c. 5% Q/Q driven by peripheral banks. However, UK banks missed due to intensifying deposit migration and mortgage competition
- Capital generation remains strong (+5-10bp), with Commerzbank and Deutsche Bank increasing capital returns as soon as Q3 (normally an interim/full year event)
- Costs in line and provisions slightly below expectations