UBS expects Marfin Popular Bank profit at EUR 450 mln

UBS analysts are forecasting the fourth quarter profit of Marfin Popular Bank (MPB) at EUR 127 mln, while for the full year 2008, the forecast is EUR 450 mln. Marfin Popular publishes its results on Thursday, 26 February.
“We expect Marfin to deliver sensible profits of EUR 127 mln for the quarter and EUR 450 mln for the full year, including EUR 55 mln from the sale of its insurance operations to CNP. Adjusting for this and other one-offs, we expect earnings of EUR 72 mln for Q4 (-30% q/q) and EUR 395 mln for the year (+11% y/y).”
“We would expect balance sheet expansion to have subsided given the environment. Focus will be on Marfin’s impairment levels which we expect at c.100 bps for the quarter (up from 41 bps in Q3), including small pre-emptive provisions. We believe that management will guide towards substantially higher levels for 2009. Marfin is well capitalised but sequential capital dynamics will be important given swift erosion in recent quarters,” note UBS analysts.
Unlike most of its peers, Marfin has limited exposure to emerging markets as recent acquisitions have been small. We would therefore pay attention to the development of the Greek and Cypriot businesses. Marfin could potentially payout a small dividend given that it remains unrestricted by the Greek support plan.
UBS maintains its 12-month rating neutral on the MPB stock and its 12-month price target at EUR 2/share. MPB shares have recently been hovering around EUR 1.50/share.