The investors of Unicaja Banco have ignored the cascade of commissions from proprietary directors that the entity has suffered in the last two months. The entity’s titles were revalued last year by slightly more than 18%, especially due to their entry into the Ibex 35, while so far this year they have advanced above 14%. And everything indicates that the action, which has set maximums at 1.2 euros, still has a long way to go. Analyst recommendations are mostly positive and they are trading below their price target.
And, while market sources have shown that corporate governance and reputational risk may lead to increased capital requirements by the regulator, it does not appear that this will ultimately be the case. To begin with, because the entity has already found replacements for the four proprietary directors and, furthermore, because the bank continues to advance in the merger, which will lead to the presidency, which is in the hands of Manuel Azuaga, being non-executive and the work of the director delegate, occupied by Manuel Menéndez, will be evaluated by the council.
As for the resignations, these same sources explain that it is something more qualitative to appreciate and not so much quantitative, since in the end what investors look at is income, which can be calculated in the future. And it is that little by little the market has valued the figures for 2022, despite the strong correction that was affected after the publication of the accounts for last year, being penalized by provisions of 50 million euros for impairments in the last quarter.
Analysts highlight the guidelines given by the entity for this exercise. The interest margin will grow to a high double digit, 15%, thanks to the repricing of credit due to the rise in the Euribor. Something that was already noticed last year, when the interest margin grew by 3%. They also expect commissions to rise to 5%, with cards and bank commissions acting as the engine. In addition, another positive aspect is the strength of the capital, since the CET 1 full loaded ratio ended the year at 13%, but the estimates of the strategic plan managed by the entity is that it will stand at 14% in 2024.
“It is above the requirements, the excess of which will be used to improve profitability and shareholder remuneration,” say financial sources. For their part, JP Morgan analysts value the bank’s commercial activity in the first half of 2022, which allowed it to absorb an evolution in the weaker markets. The change in costs during 2022 was also encouraging, especially as the bank has made progress on construction. “Another decrease of 2-3% by 2023 is an encouraging sign”, they confirm from JP Morgan
And this is the basis for analysts to place Unicaja Banco among their bets: 66% of the expert consensus compiled by ‘Bloomberg’ bets on buying, compared to 11.1% on selling it. In addition, they place the target price at 1.44 euros, compared to the current 1.18 euros, which represents a potential return of 22%, although some large investors such as Jefferies believe that Unicaja Banco shares could reach up to 1 .75 euro.
Closing of the renewal of the council
The entity will hold the general meeting of shareholders on March 30 in Malaga where it will conclude this renewal of the board. In this way, the bank has already appointed the four proprietary directors who will replace those resigned. Thus, Juan Antonio Izaguirre Ventosa will replace Petra Mateos-Aparicio Morales. José Ramón Sánchez Serrano will also be appointed proprietary director, replacing Manuel Muela Martín-Buitrago; Natalia Sánchez Romero will replace Teresa Sáez Ponte, while Miguel González Moreno will replace Juan Fraile Cantón.
In all they will be proposed for a period of three years. Likewise, the appointments of Isidoro Unda Urzaiz and María Teresa Costa Campi as independent directors will be ratified. Both already have the approval of the European Central Bank (ECB). In this way, the bank’s board of directors will be aligned with the interests of the shareholders, who will be the ones to ratify these charges, which in theory would reduce discrepancies. It should not be forgotten that the main holders of Unicaja Banco are precisely the Unicaja Foundation, with 30.24% of the capital, and the Cajastu Foundation (although its participation is less).