European Banks: Citi European Banks Weekly

Research evidence excerpt

European Banks: Citi European Banks Weekly

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European Banks

Citi European Banks Weekly 20 Jul 2026 07:35:36 ET

ACWestern Europe Andrew Coombs, CFA

Focus +44-20-7986-4053

Last week, we published our Investment Banks quarterly piece European Banks - Simon Nellis

Banking On Markets – Summer 2026: Blow Out Equities Revenues. 2Q26 saw a +44-20-7986-4012

blow-out quarter for Equities & ECM, especially in US and Asia helped by some

high profile IPOs, as well as record prime balances. We do not expect quarterly Borja Ramirez Segura

revenues to prove sustainable at these record levels, but the backdrop is likely to +44-20-7508-0206

remain supportive throughout 2H26 and into 2027. The downside for European Shrey Srivastava

banks is that the Equities strength was mainly driven by Asia and US, as opposed

+44-20-7986-2608to Europe, and US peers are electing to take this opportunity to reinvest into the

business, so competitive pressures look set to intensify. UBS (and to a lesser

extent Barclays) look best placed to benefit - we increase our UBS EPS by 7-9% on

Equities, plus Wealth AuM appreciation - but valuation already appears full in our

view. Our top-pick among the wholesale banks is SocGen and least preferred

Deutsche Bank.

We also published a detailed report on UK Banks Big Picture - Summer 2026:

Seeking A Path Through The Noise. We remain constructive on UK bank

fundamentals, with NIM expansion and high volume growth. Yet a combination of

UK politics and China regulation has muddied the picture in recent weeks. We

believe concerns around both should now begin to ease, enabling investors to

focus on the impressive return trajectories which should again be visible with

2Q26 reporting. We continue to be most constructive on the medium-term