05/02/2008 11:15
Bank of Cyprus and Marfin Popular Bank are among the top pick of Citigroup. According to a report dated February 4 on the Greek and Cypriot banks’ foreign exposure, MPB and BoC have strong capital positions, can easily cope with a New Europe earnings slowdown relative to their published budgets, and their emerging European exposure is primarily Russia driven.
Citigroup focuses on the question how exposed are Greek banks to New Europe risks? According to the report, they make limited profits in New Europe today, but expect it to be a future growth driver.
“Most Greek banks are targeting around 30% of their 2010 earnings to be derived from New Europe, with NBG above this median and Bank of Cyprus below”, the report said. “A 25% haircut to budgeted New Europe earnings would reduce 2010 group targeted earnings by about 10% for NBG, EFG, Alpha Bank; Bank of Cyprus, and Marfin Popular Bank would hardly be affected”, it concluded.
Citigroup focuses on the question how exposed are Greek banks to New Europe risks? According to the report, they make limited profits in New Europe today, but expect it to be a future growth driver.
“Most Greek banks are targeting around 30% of their 2010 earnings to be derived from New Europe, with NBG above this median and Bank of Cyprus below”, the report said. “A 25% haircut to budgeted New Europe earnings would reduce 2010 group targeted earnings by about 10% for NBG, EFG, Alpha Bank; Bank of Cyprus, and Marfin Popular Bank would hardly be affected”, it concluded.
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