RPT-MNI INTERVIEW2: Trump Stagflationary For EZ-ECB's Wunsch

MNI BRIEF: PBOC Launches Outright Reverse Repo For Liquidity

MNI: PBOC Net Injects CNY32.7 Bln via OMO Monday

MNI: PBOC Sets Yuan Parity Higher At 7.1307 Mon; +2.71% Y/Y

CHINA PBOC CONDUCTS CNY241.6 BLN VIA 7-DAY REVERSE REPOS MON

CHINA SETS YUAN CENTRAL PARITY AT 7.1307 MON VS 7.1090

EZ/UK Bond Supply Calendar: UK, Germany Auction on Tuesday

MNI: UNIV OF MICHIGAN CONSUMER SENTIMENT FINAL OCT INDEX 70.5

MNI: BELGIUM OCT BNB BUSINESS SURVEY -12.8

EUROPEAN FISCAL: DE 2025 Budget Gap Grows; Political Risk Is Rising

CANADA: Politics Week: Trudeau Facing More Internal Dissent And Departures

CANADA: Politics Week: Trudeau Faces More Pressure To Resign

© 1982-2024 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

FINANCIALS: CMZB: Small Miss On Weaker Asset Quality. Spread Negative.

FINANCIALS
BulletCredit Bullets

Commerzbank (CMZB: Baa2 pos/BBB- pos) results are rather mixed with some evidence of weakening asset quality, a pre-tax miss being driven by this. The corporate bank is the risk driver here. Guidance is confirmed but consensus is already ahead of this, and spreads have performed well into these results. We fear this may push them wider.

  • Credit stats: loan losses are up to 20bp (from 11bp in 1Q24) which is still a relatively low level but still 3-4bp weaker than consensus, driven by the corporate bank. Non-performers are stated as stable on Mar-24 (at 0.8%). But the “default portfolio” is up 9% in the quarter, to 128bp (from 121bp). CET1 is down 10bp in the period (to 14.8%, in line with consensus). So, credit stats are rather mixed – at best, in our view.
  • Revenues are 2% ahead of consensus (but mostly on trading income), costs are in line, but that loan loss miss, in an operationally geared business, means pre-tax has missed by c.2%.
  • Mgmt indicate that outlook is “confirmed” with NII guidance at c.EUR8.1bn “with upside potential” but consensus is already at EUR8.13bn. Loan loss guidance is confirmed (at <EUR800m), consensus is at EUR728m but this period alone is EUR199m. Another EUR600m buyback is being applied for.

Conf call is 0800 (London time) at: https://www.webcast-eqs.com/commerzbank-2024-q2

213 words

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.

Commerzbank (CMZB: Baa2 pos/BBB- pos) results are rather mixed with some evidence of weakening asset quality, a pre-tax miss being driven by this. The corporate bank is the risk driver here. Guidance is confirmed but consensus is already ahead of this, and spreads have performed well into these results. We fear this may push them wider.

  • Credit stats: loan losses are up to 20bp (from 11bp in 1Q24) which is still a relatively low level but still 3-4bp weaker than consensus, driven by the corporate bank. Non-performers are stated as stable on Mar-24 (at 0.8%). But the “default portfolio” is up 9% in the quarter, to 128bp (from 121bp). CET1 is down 10bp in the period (to 14.8%, in line with consensus). So, credit stats are rather mixed – at best, in our view.
  • Revenues are 2% ahead of consensus (but mostly on trading income), costs are in line, but that loan loss miss, in an operationally geared business, means pre-tax has missed by c.2%.
  • Mgmt indicate that outlook is “confirmed” with NII guidance at c.EUR8.1bn “with upside potential” but consensus is already at EUR8.13bn. Loan loss guidance is confirmed (at <EUR800m), consensus is at EUR728m but this period alone is EUR199m. Another EUR600m buyback is being applied for.

Conf call is 0800 (London time) at: https://www.webcast-eqs.com/commerzbank-2024-q2