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Currency in EUR
Last close As at 09/06/2023
EUR7.04
▲ 0.02 (0.28%)
Market capitalisation
EUR415m
ProCredit Holding (PCB) is a Germany-based group operating regional banks across South Eastern and Eastern Europe and Ecuador. The banks focus on SMEs and private middle-income and high earners.
According to its most recent World Economic Outlook released in April 2023, the International Monetary Fund expects c 3–5% GDP growth pa in 2024–28 for PCB’s countries of operations (except for Ukraine). PCB’s in-depth, impact-oriented relationships with SME borrowers (c 90% of the loan book at end-March 2023), prudent credit risk management and solid capital base (CET-1 ratio of 14.1% at end-March 2023) should help it weather the near-term macroeconomic slowdown. Longer term, PCB’s business should be assisted by the low banking sector penetration in the region, scaling potential of its regional banks, an improving deposits to loans ratio and sustained good credit quality of its portfolio, among others.
Director, Financials
Christian Dagrosa
Management Board Member
Dr Gian Marco Felice
Management Board Member
Hubert Spechtenhauser
Chairman
Sandrine Massiani
Management Board Member
| % | 1M | 3M | 12M |
|---|---|---|---|
| Actual | 14.3 | 34.9 | 76.0 |
| Relative | 14.0 | 31.8 | 59.0 |
| 52 week high/low | €7.4/€2.6 |
ProCredit Holding’s (PCB’s) strong Q123 net profit of €29.5m implies an annualised return on equity (ROE) of 13.3%. This is a result of a healthy annualised net interest margin (NIM) of 3.4% (vs 2.9% in Q122), a c 11% year on-year growth in net fee and commission income and limited cost of risk at 12bp. Importantly, ProCredit Ukraine returned to profitability with an annualised ROE of 21.7% in Q123. PCB’s ROE may be more moderate in the coming quarters as customer deposit rates are repriced, loss allowances pick up and further cost inflation is reflected in the company’s bottom line. That said, PCB’s shares now trade at an undemanding 5.2x our FY23e earnings per share, based on an ROE of 9.3% in FY23e (vs the company’s recently raised guidance of 8–10%).
| Y/E Dec | Revenue (€m) | EBITDA (€m) | PBT (€m) | EPS (c) | P/E (x) | P/CF (x) |
|---|---|---|---|---|---|---|
| 2021A | 222.0 | N/A | 94.5 | 135.0 | 5.2 | N/A |
| 2022A | 264.6 | N/A | 17.8 | 28.0 | 25.1 | N/A |
| 2023E | 296.5 | N/A | 102.8 | 143.9 | 4.9 | N/A |
| 2024E | 305.6 | N/A | 109.8 | 157.1 | 4.5 | N/A |
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