OTP Bank Nyrt: Luminor: a sensible acquisition with some heavy-lifting to do

研报英文原文证据摘录

OTP Bank Nyrt: Luminor: a sensible acquisition with some heavy-lifting to do

els

12/26E 4,956 4,650

comparable to Central and Western-European markets. Luminor generated 9% RoE in

12/27E 5,585 5,145

2025 (12% in 2023-24) on 20% CET1, whereas key regional competitors SEB and

12/28E 6,232 5,766

Swedbank produce 20-30% RoEs in their Baltic operations. This gap is explained by a

30ppt weaker cost/income and 1ppt higher cost / average loans than the Baltic Mate Nemes, CFA

operations of their Swedish peers. With potentially sizeable badwilll available, OTP can Analyst

accelerate Luminor's efficiency improvement and support the bank with liquidity in mate.nemes@ubs.com

+41-44-234 23 18order to gain further scale and reach Cost to Loan ratios comparable to domestic peers.

Based on our scenario analysis, we estimate 5-8% EPS accretion in 2027-28E. In light of Nicolas O'Sullivan

our analysis in this note, we look at the transaction positively but note that OTP will have Analyst

to communicate plans to improve Luminor's profitability and scale. nicolas.o-sullivan@ubs.com

+44-20-7568 5364

Strong M&A track record but initial ownership period not without risks

OTP built up a strong M&A track record post GFC, mostly with in-market deals within

the existing operating platform. We see the risks around the Baltics significantly lower

compared to the previous acquisition in Uzbekistan but note that a certain adaptation

period for OTP will be necessary in a new market.

Valuation: based on GGM

OTP is trading at 9.1x PE 2027E ex. Russia before the aforementioned EPS accretion. P/

TNAV is 2.1x for 21% RoTE 2027E. Our rating and PT on OTP is Under Review

Highlights (HUFm) 12/23 12/24 12/25 12/26E 12/27E 12/28E 12/29E 12/30E