News:
- 2014/07/31. Coverage from reuters and bloomberg
- 2014/07/30. Reminder for tomorrow (Communicate)
- 2014/07/30. BBVA results (ES) (ES) (bloomberg). -53% YoY (with capital gains). +11.7% (w/o). NPL at 6.4% from 6.8% last quarter.
- 2014/07/28. BFA-Bankia. Good (ES)
- 2014/07/25. CaixaBank results. Good: shares +3.5% (ES) and (reuters)
- 2014/07/25. Prevision for SAN: €1.46bi (ES) (EPS of €0.124). Also coverage of other banks.
- 2014/07/24. Bankinter and Sabadell reported good Q2 results (reuters)
Report date is July 31th.
Q2 was so quite.
EPS between €0.12 (bad) and €0.14 (good)
A few points to check:
- UK continuing to shine
- SCUSA still torrid? Effects of the commercial push for ex-Sovereign?
- Brazil improving? Anyway exchange rate is quite favorable this quarter.
- Blips in Spain?
M&A also quite for the quarter: Acquisition: Getnet in Brazil and GE money in Scandinavia. Sell: 50% of custody business.
I don't consider the offer to purchase 25% of Santander Brasil as an acquisition. Simply an opportunistic operation financed with new shares.
But Q3 and following quarters will not be quite. The effects of Espirito Santo's Portuguese bank is only an initial event of a long series.
In the next 2 quarters we will have the ECB stress tests results, EZ banking union, BIS III first loading year and recapitalization of companies in Spain.
The first 3 events will cause significant MA activity. Santander will pass the tests without problems. The company has amassed significant capital surplus to be on the acquisition side.
Not only the capital surplus (including a solid 5 year capital plan whatever the Federal Reserve says) is ready: during Q1, SAN parket €1.1bi of exceptional gains in the balance sheet. The quarter before, a smaller amount was also parked. These funds will be used to cover the restructuring costs after acquisitions. Anyway that is how they utilized capital gains in 2013 (cover the merges in Spain and Poland), and this is in contrast of 2012 where utilization of exceptional gains covered the real estate situation in Spain.
And the best is that in case Santander depletes capital surplus through acquisitions, they will continue to pay the dividend as scrips, the current shareholder most friendly way to raise capital, allowing to spare the 21% Spanish dividend tax for a longer period.
Time goes too slowly.
