Citi ups Avanza to 'buy' as it expects rate cuts to boost NII

Avanza Bank Holding AB

21/05/2024 09:56

** Citigroup upgrades Avanza Bank  AVANZ.ST  to "buy" from
"neutral", expecting the Swedish c.bank's lower interest rates
to increase the financial group's net interest income
    ** Shares rise as much as 5.3% to SEK 279.7, their highest
price since March 2023
    ** Citi says it expects the bank's NII to grow by 15% in the
three years to 2026, vs consensus expectations for a 15% fall
    ** From 2025 onwards, customers will likely be more willing
to hold more meaningful cash balances in investment accounts,
resulting in higher levels of cash for the bank, it says
    **  Citi also sees high growth potential for Avanza as its
young customer base matures
    ** Out of 11 analysts covering the stock, only Citi rates it
"buy", while five analysts have "hold" and five "sell", as per
LSEG data

 (Reporting by Anna Chaberska)
 ((Anna.chaberska@thomsonreuters.com))