European Banks Consensus Tracker: Great(er) Expectations: Rising price and EPS forecasts into the 2Q print

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European Banks Consensus Tracker: Great(er) Expectations: Rising price and EPS forecasts into the 2Q print

Global Research

8 July 2026ab

European Banks Consensus Tracker Equities

Europe including UKGreat(er) Expectations: Rising price and

EPS forecasts into the 2Q print Banks

Jason Napier, CFA

Analyst

jason.napier@ubs.com

Banks have done well, benefitting from an assumed improved outlook +44-20-7568 5037

European banks are up 17% YTD, outperforming the market by 10%. All of that Alvaro Fernandez-Garayzabal

outperformance is since a 10 June inflection on news of the potential US-Iran MoU with Analyst

banks and market up 15% and 5% respectively since then. We have the sector at 10.0x alvaro.fernandez-garayzabal@ubs.com

/ 9.1x FY27 / 28E EPS, 1.8x TNAV for a 17-18% forecast ROTE and a 6-7% distributed +34-91-436 9622

yield supported by an assumed improvement in macro outlook as energy prices Ignacio Cerezo

normalise and modestly higher EPS forecasts into 2Q on a slightly more bullish revenue Analyst

outlook. While banks still arguably look good relative value at a 30% P/E discount to the ignacio.cerezo@ubs.com

market, we're increasingly mostly keen on the attractions of broad-based double-digit +44-20-7568 4409

EPS growth, as emphasised in a recent Chart of the Week, underpinned by price Sanjena Dadawala

discipline and volume growth as Europeans re-lever. Analyst

sanjena.dadawala@ubs.com

Tactics will become more important +44-20-7567 0753

We expect near-term market conversations to focus on i) European bank M&A, ii) Johan Ekblom, CFA

whether (and where) loan and deposit spreads are under pressure on increased Analyst

competition (or new competitors), iii) likely upgraded FY26 management guidance at johan.ekblom@ubs.com