Macquarie slashes earnings forecast for Australian banks

Bank of Queensland

30/06/2023 06:11

** Macquarie says Australian banks  .AXFJ  remain
underweight deposits relative to other developed markets
including the U.S., the UK, and Canada
    ** Brokerage expects ongoing shift from cheaper deposits to
more expensive categories, partly unwinding the funding benefits
that Aussie banks enjoyed in recent periods
    ** Says banks with smaller retail and business deposit bases
such as NAB  NAB.AX  & ANZ  ANZ.AX  had higher overall funding
costs, while CBA  CBA.AX  generated better returns
    ** Macquarie says it expect CBA to be the biggest
beneficiary of higher rates, but believe the extent of the
benefit is overestimated by the market
    ** Across the major banks, brokerage reduces EPS
expectations by ~1-4% in FY24 & by ~3-6% in FY25
    ** Says its order of preference is National Australia Bank,
Westpac Banking  WBC.AX , Australia and New Zealand Banking
Group, Commonwealth Bank of Australia
    ** Brokerage says it prefers Bendigo and Adelaide Bank
 BEN.AX  over Bank of Queensland  BOQ.AX  amongst regionals
    ** AXFJ down 2.3% YTD as of last close 
    


 (Reporting by Riya Sharma in Bengaluru)
 ((Riya.Sharma@thomsonreuters.com;))