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Erste Group is a financial services provider based in Austria. As of Dec 31 2015, Co.'s total assets amounted to Euro199,743 million and the number of customers was approximately 16.5 million. Co.'s key business is the retail business, covering the entire spectrum from lending, deposit and investment products to current accounts and credit cards. In addition to providing financial services to private individuals, Co.'s core activities also include advisory services and support for corporate clients in financing, investment and access to international capital markets, public sector funding and interbank market operations.
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The independent financial analyst theScreener just awarded an improved star rating to ERSTE GROUP BANK AG (AT), active in the Money Center Banks industry. As regards its fundamental valuation, the title receives an improved star rating and now shows 3 out of 4 possible stars. With regard to its market behaviour, it remains unchanged and can be qualified as risky. theScreener considers that these elements allow slightly upgrading its rating to Neutral. As of the analysis date July 9, 2019, the closing price was EUR 33.39 and its expected value was estimated at EUR 33.09.
HEADLINES: • Erste Bank: Keeping promise on ROTE (stays BUY) • Europe macro: reflections on the new EU leadership nominations • Greece macro: elections on Sunday - all you need to know • Turkey macro: inflation down, the case for modest rate cuts is on • Polish banks: Parliament excludes conversion scheme from president's draft bill on mortgagors • Famur: wins PLN 67m contract from PGG for delivery of roof supporters POSITIVE • Warsaw Stock Exchange: launches project aimed at developing proprietary trading system NEUTRAL • Polish telecoms: mobile number portability in 2Q19 NEUTRAL • Sh...
In this report, we revise our financial forecasts for Erste Bank, discuss the risk of introduction of special charges for the banking sector in the Czech Republic, and reflect a EUR 230m negative one-off (in gross profit) in our 2019E expectations due to the unfavourable ruling of the Romanian court regarding building societies. We note that the discussion on sector charges in the Czech Republic restarted in late-April during the EU elections campaign, followed by some political turmoil in Austria in May, and then finally the recent news on a significant one-off loss in Romania. All of the abo...
Item 2: Approve the Remuneration ReportThe remuneration structure is unsatisfactory. The main concern at the Company is that the potential maximum incentive pay including the bonus, matching shares on the deferred portion of the bonus and the LTI amounts to 1000% of base salary, which is considered grossly excessive. Actual incentive pay during the year was1.6 times the ECGS limit. Furthermore, variable remuneration is overly reliant on a single performance metric, benchmark profit before tax. A second performance criteria will be used in the coming year. We note that the Company has adjusted ...
Leadership changes Vittorio Colao was succeeded by Nick Read who was appointed Chief Executive Designate on 27 July 2018 and became Chief Executive on 1 October 2018. Margherita Della Valle joined the Board as Chief Financial Officer on 27 July 2018. Item 15: Advisory vote on the Remuneration ReportThe structure is unsatisfactory. The maximum bonus and total incentive pay exceed guidelines. The quantum for the year was excessive. Pay weighted more towards rewarding long-term performance, but there are overlapping performance conditions as free cash flow was used for both the STI and LTI. A b...
Item 2: Approve the Remuneration ReportThe structure is unsatisfactory as the use of qualitative criteria exceeds guidelines and the pension is excessive. Qualitative criteria slightly exceeds ECGS guidelines. There is no disclosure of targets of the metrics for the STI and a bonus was paid though the Company made a loss for the year. A recruitment award was paid during the year. We recommend shareholders oppose. Item 3: Approve the Remuneration PolicyGiven that the pension contribution will be reduced to within ECGS guidelines, the main concern at the Company is the use of qualitative criter...
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