UBS stays positive on Nordic banks, keeps Swedbank as its top pick

SEB SA

07/10/2022 12:35

** UBS remains upbeat on the prospects for Nordic banks
ahead of Q3 results and sees scope for consensus EPS upgrades
    ** It has "buy" rating on top Nordic banks: Swedbank
 SWEDa.ST , Svenska Handelsbanken  SHBa.ST , Nordea  NDAFI.HE ,
SEB  SEBa.ST  and Danske Bank  DANSKE.CO , while staying
"neutral" on DNB  DNB.OL 
    ** It says Nordic banks have defensive loan books compared
to European peers, adding that it believes they should continue
to post below average credit losses
    ** Swedbank remains its top pick, given above average rate
gearing 
    ** UBS' key themes for Q3 include among others an upside
risk to consensus on net interest income (NII) as rate gearing
is not reflected, and some normalisation in asset quality from
updated macro scenarios
    ** "Our NII forecasts (are) close to 9% above consensus for
2023," the brokerage says and adds that relative to consensus
forecasts, it is most positive on Danske Bank, Handelsbanken and
Swedbank    
    ** "Despite above average property exposure we think
Handelsbanken will likely post the lowest bps cost of risk in
2023," UBS adds
 (Reporting by Jagoda Darlak)
 ((jagoda.darlak@tr.com))