MS expects banks' mid-term earnings to benefit from loan growth
XLF•Rating changes and top picks
** The broker ups ING and NatWest to "overweight" from "equal-weight", citing the former's potential to be "high-teens" ROTE bank and the latter's positioning in corporate loans
** It also ups to "equal-weight" Swedbank, on better new mortgage business market share, and DNB on sector-aligned risk-reward profile
** It cuts to "equal-weight" Barclays, on lower-than-expected operating leverage, and Nordea on valuation in line with peers
| COMPANY | RATING | OLD RATING | PT |
|---|---|---|---|
| ING INGA.AS | Overweight | Equal-weight | €37.00 |
| NatWest NWG.L | Overweight | Equal-weight | 850p |
| Barclays BARC.L | Equal-weight | Overweight | 580p |
| Swedbank SWEDa.ST | Equal-weight | Underweight | SEK 386 |
| DNB DNB.OL | Equal-weight | Underweight | NOK 330 |
| Nordea NDAFI.HE | Equal-weight | Overweight | €19.00 |
| UniCredit CRDI.MI (top pick) | Overweight | no change | €105.00 |
| Deutsche Bank DBKGn.DE (top pick) | Overweight | no change | €38.50 |
| Santander SAN.MC (top pick) | Overweight | no change | €14.70 |
| ABN Amro ABNd.AS (top pick) | Overweight | no change | €48.00 |
Morgan Stanley sees positive mid-term earnings picture for European banks
** Mid-term 'earnings picture' for European banks stays positive amid loan growth and resilient investments in manufacturing, Morgan Stanley says
** Corporate lending acceleration in Q2 shows investment broadens beyond AI, infrastructure to manufacturing, and even real estate among others, it says
