Macquarie downgrades Aussie banks as high costs clouds earnings

Bendigo and Adelaide Bank

22/09/2023 06:45

** Macquarie downgrades Australian banks  .AXFJ  to
"underweight," flagging cost pressures due to higher expenses
    ** Brokerage projects cost growth 1-5% above the consensus
estimate of 2-3% increase in FY24-25, tracking rising wages 
    ** Adds, staff costs represent ~55% of banks' expenses
    ** Cuts earnings estimates for ANZ Group Holdings  ANZ.AX ,
CBA  CBA.AX  and NAB  NAB.AX  by around 1% each from through
FY25
    ** Westpac Banking Corp  WBC.AX  is the only outlier with
lower expense forecast - Macquarie
    ** Downgrades recommendations on regional lenders Bendigo
and Adelaide Bank  BEN.AX  and Bank of Queensland  BOQ.AX  to
"underperform" from "neutral"
    ** Among "big four" banks, ANZ is up 5.9%, while CBA, NAB
and WBC are down 2.5%, 4.4% and 10.1%, respectively, this year,
as of last close

 (Reporting by Poonam Behura in Bengaluru)
 ((Poonam.Behura@thomsonreuters.com;))