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Original-Research: UmweltBank AG - from GBC AG
27.01.2025 / 14:30 CET/CEST
Dissemination of a Research, transmitted by EQS News - a service of EQS
Group.
The issuer is solely responsible for the content of this research. The
result of this research does not constitute investment advice or an
invitation to conclude certain stock exchange transactions.
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Classification of GBC AG to UmweltBank AG
Company Name: UmweltBank AG
ISIN: DE0005570808
Reason for the research: Research Comment
Recommendation: Buy
Target price: 10.00 EUR
Target price on sight of: 31.12.2025
Last rating change:
Analyst: Cosmin Filker, Marcel Goldmann
Management Board presents convincing growth scenario at the Capital Markets
Day
At the Capital Markets Day, which UmweltBank AG held for the first time on
15 January 2025, the company provided an update on its strategic direction
up to the 2028 financial year and a rudimentary review of the past 2024
financial year. The preliminary figures will be published on 31 March 2024.
In addition to a presentation by Dietmar von Blücher who, on that very day,
reached the one-year mark as a member of Umweltbank's Executive Board,
having begun on 15 January 2024, the heads of the various departments
(Private Clients, HR, Corporate Clients) gave keynote speeches, providing a
good insight into the inner workings of the bank.
The expansion of the liabilities side, i.e. the deposit business, is an
important cornerstone of their corporate strategy and should contribute
significantly to the growth of net interest and commission income in the
future. According to the company, an interest margin of around 100 basis
points can be achieved by investing customer funds at matching maturities
(ECB investment). Against this backdrop, the expansion of private customer
deposits to around EUR 3.5 billion in 2024 (2023: EUR 2.5 billion) should be
seen as a good basis for an expected increase in the financial result. The
'UmweltFlexkonto' call money (currently: 2.0% interest) in particular is
likely to have generated high demand.
While deposits from private customers are growing dynamically, growth in the
corporate customer business, which primarily comprises loan financing for
sustainable projects (property, wind, solar), is dependent on the
restrictive equity factor. With a total capital ratio of 16.9% (30 October
2024), there is a sufficient capital buffer to the regulatory value of
15.5%, but strong growth in credit volume cannot be achieved without
additional equity. On the one hand, additional equity is to be obtained by
reducing the higher capital surcharge for lending set by BaFin. On the other
hand, it is to come from the planned complete sale of equity investments by
2026.
At the Capital Markets Day, Dietmar von Blücher also presented a detailed
earnings and expenses scenario up to the financial year 2028. Net interest
income is expected to rise significantly again from the current financial
year 2025 onwards, having bottomed out in 2023 and 2024. The scenario
graphic presented at the Capital Markets Day indicates a range of EUR 60 - EUR
70 million for the current financial year 2025 and of around EUR 70 - EUR 80
million for the coming financial year 2026. The main driver for this growth
is expected to be a significant increase in the deposit business, which can
then be invested risk-free at the ECB at improved conditions.
At the same time, net interest income should benefit from an improvement in
the interest margin in the corporate customer business, i.e. in the lending
business. Expiring loans will be replaced by new loans with improved
conditions. By 2028, the annual new lending business is expected to increase
from around EUR 245 million in 2024 to over EUR 650 million. At the same time,
the ratio of lending to capital commitment is to be improved by, among other
things, taking out syndicated loans.
The company expects net commission and trading income to benefit from rising
income in the securities and lending business. In the middle of the past
financial year, the successful issue of the first UmweltBank ETF was added
to their own issues business. Further ETFs and the expansion of their fund
business should lead to an increase in commission and trading income.
The expected increase in net interest income and net commission and trading
income is likely to be offset by a disproportionately low increase in
administrative expenses. This is particularly true in light of the
transformation implemented in recent years, which should lead to a
significant reduction in administrative expenses from 2025 onwards. The
target of achieving a cost-income ratio of less than 60% by the 2028
financial year is therefore confirmed. Compared to the previous growth
scenario, the Management Board of UmweltBank expects a flatter increase in
earnings before taxes, particularly from the 2027 financial year onwards.
This is primarily due to lower momentum in the lending business.
Our previous estimates (see Research Comment dated 15 November 2024), which
cover the forecast period from 2024 to 2026, are largely in line with the
company's updated scenario. We therefore confirm these and at the same time
the price target of EUR10.00 determined within the framework of a residual
income model. The rating remains BUY.
You can download the research here: http://www.more-ir.de/d/31671.pdf
Contact for questions:
GBC AG
Halderstraße 27
86150 Augsburg
0821 / 241133 0
research@gbc-ag.de
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Beim oben analysierten Unternehmen ist folgender möglicher
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Interessenkonflikte finden Sie unter:
https://www.gbc-ag.de/de/Offenlegung
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Date (time) Completion: 27.01.2025 (8:56 am)
Date (time) first transmission: 27.01.25 (2:30 pm)
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2075417 27.01.2025 CET/CEST
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