Stock market crashes, fear of the contagion effect and a banking reputation about to be blown up. This Tuesday marks six months since the Ides of March swept away Credit Suisse’s 167-year history. Negotiations against the clock in Zurich to close an express merger with UBS gave rise to a heart-stopping weekend, the effects of which are still being felt on the stock market. At least in Spain, where only BBVA is close to the levels prior to the stock market crash that caused SVB Financial’s intervention in the United States.
Of the six banks that are part of the Ibex 35, the entity chaired by Carlos Torres is the only one that comes close to this barrier, after consolidating seven euros per share. At the close of the markets this Monday, it was trading at 7.1 euros, so it is just less than 4% away from reaching the 7.4 euros at which it was trading at the beginning of last March, once the dividend has been discounted. of capitalization, which has a deflating effect on capitalization.
The improvement of the situation in Turkey after the earthquake in February and the return to interest rate increases by the Ottoman central bank to control inflation are the factors that, according to analysts, have acted as a catalyst for the recovery. In fact, the bank based in ‘La Vela’ has accumulated a revaluation of almost 27%, the highest increase in the last nine months. Nuria Álvarez, Renta 4 analyst, emphasizes the strategy followed by BBVA, with a “consistent” roadmap compared to other Spanish banks with an international vocation, whose business is more “diversified.”
This is, for example, the case of Santander, which faces regulatory risk due to its greater international presence. Poland stands out, where it is currently suffering from the surprise reduction in interest rates decreed in the country two weeks ago. The group chaired by Ana Botín is still 10% away from recovering the annual highs it reached before the onset of the financial crisis, when its shares moved at 3.8 euros, above the 3.4 euros at which it closed this moon
The Cantabrian bank has carried out two share buyback programs along the way that, although they may have contributed to boosting its value on the stock market, Álvarez highlights that the impact of this type of initiative has a “not very significant” effect on the price as it is Limited in volume by law. In recent months, the Spanish banking sector has used excess liquidity in this formula with the aim of reinforcing shareholder remuneration.
In addition to the two mentioned, Banco Sabadell is another of the entities that has opted for capital reduction and is now immersed in a buyback program, of which it has already carried out three quarters of the total. The firm chaired by César González-Bueno revalued more than 16% in the year, up to 1.02 euros, so it would still need 22.5% to end this downturn.
CaixaBank and Bankinter are not spared either, correcting almost 14% and 15%, respectively, since the March peak and appearing as banking ‘red lanterns’ with losses of 7.4% and 3.2% in the last nine months. It is accompanied by Unicaja Banco, which, since the coup last March, has not managed to raise its head and is trading slightly below the 1.04 euros with which it debuted on the Ibex 35 at the end of 2022. Overall, the Ibex bank It has lost almost 10% since the bankruptcy of several retail banks in the United States, a decline in line with the 8.8% recorded by European banks during the same period.
Although these six values show great potential in the face of the corrections experienced, they face a scenario of uncertainty with the pause in interest rates at the epicenter. The market has already begun to discount the end of the rises in reference rates in the eurozone, as well as a slowdown in credit volume with a view to the 2024 income statements, hence the stagnation in prices. “Investors have begun to discount a more negative scenario than the macroeconomic data suggests,” says Álvarez, while emphasizing that the risk-return ratio of Spanish banking is “attractive” at current prices.