Banco Popular Espanol SA Banking Wagging the dog

Banco Popular Espanol SA Banking Wagging the dog

Banco Popular Espanol SA
Banking
Wagging the dog
● Popular’s decision to raise capital and clean up its balance sheet is a step in
the right direction. But significant challenges remain. Management is too
optimistic about the revenue outlook, meaning efforts to cut cost and
dispose of assets are likely to remain reactive. Earnings downgrades are
thus likely to continue, driving further underperformance. We retain our
Sell rating and cut our price target to €1.00.
24 August 2016
Current price
Price target
● Revenue expectations are too ambitious: Popular’s net interest income is
likely to be weak in H2, with guidance once again being cut. Management
expects €2.1bn of NII in FY16 (consensus remains 5% too high). Despite
this, ambitious growth expectations are unchanged. NII is expected to be
3-4% above the H2 run rate in 2017, with further growth expected in 2018.
EUR 1.19
EUR 1.00
● We forecast further revenue declines: As demand for debt remains weak,
we expect loan volumes to be flat at best. Margins are likely to come under
further pressure as banks compete for growth (among SMEs in particular,
where Popular is focused). Meanwhile, the scope for liability re-pricing will
soon fade. As such, we expect Popular’s revenues to continue to fall.
● Cost restructuring is likely to continue: Popular has committed to €175m
of cost savings in 2017, with €375m of restructuring charges to be booked
this year. We see this as positive and credit Popular for cutting costs more
aggressively than its peers. However, until management recognises that
revenues are in structural decline and are unlikely to grow, its cost cutting
and disposal plans are likely to be insufficient.
● Among the biggest losers of Spain’s political stalemate: This stems from
Popular’s reliance on real estate disposals via wholesale markets. Demand
has collapsed as a result of the political uncertainty. Other banks have
expressed concern, with CaixaBank’s CEO recently commenting that “the
market is not there to provide a fair price for a very large transaction”.
● Despite its recent rights issue, capital may be a constraint: As a result of
additional restructuring charges, we model a 10.3% CET1 ratio at year-end.
The potential sale of Totalbank (Popular’s US business) may provide a
50bp benefit, but there remains little margin for error, in our view.
SELL
23/08/2016 Madrid Close
Market cap (EUR m)
Reuters
Bloomberg
5,108
POP.MC
POP SM
Changes made in this note
Rating:
Price target:
Sell (no change)
EUR 1.00 (1.15)
Estimates changes
2016E
2017E
2018E
old ∆ % old ∆ % old ∆ %
Income 3,070 1.9 3,072 -3.5 3,036 -3.7
PPOP
1,395 -22.9 1,431 -1.1 1,428 -2.8
EPS
-0.63 -47.5 0.09 -2.4
0.13 -14.4
Source: Berenberg estimates
Share data
Shares outstanding (m)
Daily trading volume
4,231
38,663,290
Key data
Price/book value
CAGR sales 2016-2018
CAGR EPS 2016-2018
0.4x
-3.3%
-
● Consideration of asset sales suggests caution on the outlook: The sale of
Totalbank makes strategic sense, in our view. We prefer banks to focus on
their core markets and see no benefit from sub-scale foreign investments.
Yet Popular’s consideration of asset sales to rebuild its capital may suggest
concern that its profitability (and capital generation) may remain weak.
● 15% cuts to estimates: Our outer year estimates fall c15%, driven by lower
NII and fee income. We had already embedded costs below consensus.
Y/E 31/12., EUR m
2014
2015
2016E
2017E
2018E
EPS
EPS (adj.)
BVPS
TBVPS
DPS
No. of Shares (m)
P/E (adj.)
P/TBV
RoE
RoTE
Dividend Yield
Payout Ratio
0.14
0.14
5.97
4.45
0.06
2,115
8.7x
0.27x
2.4%
3.1%
4.9%
42%
0.01
0.01
5.88
4.33
0.05
2,115
114.8x
0.27x
0.2%
0.2%
4.5%
522%
-0.92
-0.92
2.85
2.06
0.00
3,213
-1.3x
0.58x
-23.9%
-32.8%
0.0%
0%
0.08
0.08
2.89
2.11
0.00
4,262
14.1x
0.56x
2.9%
4.0%
0.0%
0%
0.11
0.11
2.97
2.19
0.03
4,294
11.1x
0.54x
3.7%
5.0%
2.7%
30%
Source: Company data, Berenberg
Andrew Lowe, CFA
Analyst
+44 20 3465 2743
[email protected]
Iro Papadopoulou
Specialist Sales
+44 20 3207 7924
[email protected]
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Banco Popular Espanol SA
Banking
SELL
Investment thesis
24 August 2016
Current price
Price target
EUR 1.19
EUR 1.00
Reuters
POP.MC
Bloomberg
POP SM
Market cap (EUR m)
Trading volume (m)
Free float
5,022
better pricing power, this is offset by higher credit risk (we expect
significant forbearance).
38.7
● We do not believe that shareholders benefit from Popular’s plans to
Share performance
Sindicatura de Accionistas de BPE: 10%
High 52 weeks
Low 52 weeks
Business description
Performance relative to
Popular is a Spanish retail/commercial bank
with a particular focus on SME lending.
EUR 3.91
EUR 1.12
SXXP
SX7P
1mth -7.8%
3mth -45.3%
12mth -64.8%
-9.5%
-36.6%
-40.8%
Profit and loss summary
accrue to
● Our price target is based on a P/TNAV derived from our 2018E
RoTE and a CAPM-derived cost of equity.
Balance sheet
EURm
2014
2015
2016E
2017E
2018E
Revenues
Costs
PPOP
Loan loss charge
PBT
Tax
Minorities
Net income
Net income adj.
EPS reported
EPS adjusted
Year end shares
Average shares
DPS
3,876
-1,871
2,005
-1,664
373
-43
1
290
290
0.14
0.14
2,141
2,115
0.06
3,431
-1,741
1,689
-1,391
114
-8
-1
22
22
0.01
0.01
2,165
2,115
0.05
3,127
-2,051
1,076
-3,772
-4,045
1,162
0
-2,966
-2,966
-0.92
-0.92
4,231
3,213
0.00
2,966
-1,550
1,416
-778
563
-121
0
358
358
0.08
0.08
4,294
4,262
0.00
2,923
-1,535
1,388
-607
707
-163
0
460
460
0.11
0.11
4,294
4,294
0.03
2014
2015
2016E
2017E
2018E
-11.5%
-8.8%
-6.9%
17.8%
-15.7%
-36.3%
-92.5% -9028.5%
-0.9%
1.4%
-1.7%
2.9%
-4.8%
-8.8%
-1.4%
-7.2%
2.1%
1.9%
-5.2%
-24.4%
31.6%
-109.1%
0.5%
0.5%
-3.0%
4.1%
1.8%
-1.4%
-1.0%
-1.9%
27.5%
0.5%
0.5%
0.5%
3.6%
1.8%
Growth and margins
EURm
Loans
Deposits
Assets
2014
2015 2016E 2017E 2018E
100,583 99,638 100,996 101,501 102,008
96,036 88,335
161,456 158,650 163,224 164,040 164,860
Equity
T. book value
TBV per share
12,783
9,518
4.45
12,720
9,381
4.33
12,066
8,709
2.06
12,424
9,067
2.11
12,747
9,389
2.19
Core equity tier 1
Risk-weighted assets
8,298
79,939
8,263
76,087
7,130
69,370
7,489
67,256
7,811
67,593
Key ratios
9.1%
8.6%
9.7%
5.1%
-0.5%
10.1%
-5.0%
6.1%
2.5%
Valuation metrics
Andrew Lowe, CFA
Analyst
+44 20 3465 2743
[email protected]
internationalise its business; instead, benefits
management/staff.
90.0%
Non-institutional shareholders
P / earnings
P / book value
P / t. book value
Dividend yield
P / revenues
P / PPOP
Assets / market cap
Loans / market cap
Deposits / market cap
losses required to clean up Popular’s balance sheet.
● While Popular’s micro-SME focus and relationship model allows for
23/08/2016 Madrid Close
Revenue growth
Cost growth
PPOP growth
EPS adj growth
Loan growth
Asset growth
RWA growth
T. book value growth
Revenues / assets
● We believe that market participants underestimate the future loan
Costs / income
PPOP / assets
LLC / loans
Tax rate
RoA
RoE
RoTE
CET1
Leverage ratio
2014
2015 2016E 2017E 2018E
48.3%
1.3%
1.7%
11.6%
0.2%
2.4%
3.1%
10.4%
6.0%
50.8%
1.1%
1.4%
7.2%
0.0%
0.2%
0.2%
10.9%
6.0%
65.6%
0.7%
3.8%
28.7%
-1.8%
-23.9%
-32.8%
10.3%
5.4%
52.3%
0.9%
0.8%
21.5%
0.2%
2.9%
4.0%
11.1%
5.6%
52.5%
0.8%
0.6%
23.0%
0.3%
3.7%
5.0%
11.6%
5.8%
Key risks to our investment thesis
2014
2015
2016E
2017E
2018E
● Sustained economic recovery in Europe/Spain is the key risk to our
8.7x
0.2x
0.3x
4.9%
0.6x
1.3x
63.5x
39.6x
37.8x
114.8x
0.2x
0.3x
4.5%
0.7x
1.5x
61.7x
38.8x
34.4x
-1.3x
0.4x
0.6x
0.0%
1.2x
3.5x
32.5x
20.1x
-
14.1x
0.4x
0.6x
0.0%
1.7x
3.6x
32.2x
19.9x
-
11.1x
0.4x
0.5x
2.7%
1.7x
3.7x
32.3x
20.0x
-
view. This would lift pressure on interest rates, loan growth and asset
quality.
Iro Papadopoulou
Specialist Sales
+44 20 3207 7924
[email protected]
Banco Popular Espanol SA
Banking
Q2 2016 results versus expectations
Figure 1: Q2 results were disappointing
Popular – Q2 2016 results
Q1 15
Q2 15
Q3 15
Q4 15
Q1 16
Q2 16
Q2 16C
Q2 16A
YoY
QoQ
EURm
EURm
EURm
EURm
EURm
EURm
EURm
EURm
%
%
%
%
Income Statement
Net interest income
Fee income
Trading income
Other income
Total income
Total expenses
Pre-provision operating profit
Financial asset impairment losses
Impairment of other assets
Gains & losses on assets held for sale
Profit before tax
Income tax
Profit & loss from discontinued operations
Minorities
Net income
AT1 interest expense
Net attributable income
check
562
147
200
19
928
-422
506
-263
-99
-21
122
-31
0
0
91
-21
71
-
564
147
142
29
882
-423
459
-250
-122
41
127
-31
0
0
97
-21
76
-
560
153
121
29
863
-434
429
-234
-50
-22
124
-34
0
0
90
-21
69
-
565
149
100
-56
758
-463
296
-644
47
42
-259
88
0
-1
-173
-21
-193
-
551
141
107
31
831
-414
417
-203
-89
0
124
-31
0
0
94
-21
73
-
529
137
100
-6
760
-419
341
-346
-20
9
-15
18
0
0
3
-21
-18
-
533
139
92
4
768
-417
351
-294
529
136
105
-10
759
-421
338
-314
0%
-1%
5%
67%
0%
1%
-1%
-9%
-1%
-2%
14%
-330%
-1%
1%
-4%
7%
-6%
-7%
-26%
-135%
-14%
0%
-26%
26%
-4%
-4%
-1%
-132%
-9%
2%
-19%
55%
-57
-40
260%
-30%
2
1
0
0
3
-21
-18
-16
16
0
0
0
-21
-21
5%
-11%
-95%
-897%
1489%
-96%
-113%
-151%
-568%
-100%
-113%
-152%
-12%
-100%
Number of shares
EPS (c)
2,143
4.3
2,147
4.5
2,149
4.2
2,152
-8.0
2,157
4.3
4,161
0.1
4,161
0.1
4,205
0.0
1.37%
45.5%
25.6%
0.97%
0.22%
2.9%
3.5%
10.5%
47.7%
1.37%
48.0%
24.2%
0.92%
0.23%
3.0%
3.7%
10.6%
49.2%
1.39%
50.3%
27.4%
0.86%
0.22%
2.8%
3.5%
10.6%
48.6%
1.42%
61.0%
33.8%
2.40%
-0.43%
-5.4%
-6.7%
10.9%
48.0%
1.38%
49.8%
24.7%
0.76%
0.23%
2.9%
3.7%
11.1%
46.2%
1.31%
55.1%
116.8%
1.30%
0.01%
0.1%
0.1%
14.8%
45.0%
54.3%
-50.0%
14.8%
-
1.30%
55.5%
99.8%
1.16%
0.00%
0.0%
0.0%
13.6%
45.0%
3%
1%
0%
0%
-10%
-18%
-
0%
-1%
0%
-9%
7%
0%
2%
1%
0%
-2%
8%
2%
Key Ratios
Net interest margin (NII / avg. assets)
Cost income ratio
Tax rate
Cost of risk
RoA
RoE
RoTE
CET1 capital ratio (CRD IV - fully loaded)
RWA/Assets
Balance Sheet
Gross loans
Net loans
Total assets
Risk-weighted assets (CRD IV - phased in)
Shareholders' equity
Shareholders' equity ex intangibles
108,833 109,057 107,822 107,085 106,874 105,830
100,847 101,293 100,462 99,638 99,983 99,883
166,799 162,648 160,374 158,650 161,995 161,833
79,554 79,969 77,986 76,087 74,887 72,825
12,871
12,892
12,925
12,720
12,755
15,236
10,355 10,363 10,380
10,148
10,184 12,666
109,151
100,493
162,412
73,085
13,748
10,390
vs Est vs Cons
Source: Berenberg research, company data, Inquiry Estimates
3
Banco Popular Espanol SA
Banking
Consensus earnings revisions
Figure 2: Consensus estimates remain under extreme pressure – we see little to change this
Popular – Consensus revisions
a) Consensus EPS by fiscal year, €
b) Consensus BVPS by fiscal year, €
1.20
2014
2015
2016
2017
2018
1.00
0.80
0.60
10.00
8.00
7.00
0.40
6.00
0.20
5.00
Jan-16
May-16
Sep-15
May-15
Jan-15
Sep-14
Jan-14
May-14
Sep-13
May-13
Jan-13
Sep-12
Jan-12
-0.40
May-12
0.00
4.00
3.00
c) Consensus RoE by fiscal year
Jan-16
May-16
Sep-15
May-15
Jan-15
Sep-14
Jan-14
May-14
Sep-13
May-13
Jan-13
-0.80
Sep-12
Jan-12
2.00
-0.60
May-12
-0.20
2014
2015
2016
2017
2018
9.00
d) Implied CoE
10%
5%
16%
g=0%
14%
g=3%
12%
10%
Jan-16
May-16
Sep-15
May-15
Jan-15
Sep-14
Jan-14
May-14
Sep-13
May-13
2%
Jan-15
May-15
Sep-15
Jan-16
May-16
May-15
Sep-15
Jan-16
May-16
Sep-14
May-14
Jan-14
Sep-13
May-13
Jan-15
e) Consensus DPS by fiscal year, €
Jan-13
-20%
Sep-12
0%
Jan-12
-15%
6%
4%
2014
2015
2016
2017
2018
-10%
8%
May-12
Jan-13
Sep-12
May-12
f) Consensus payout ratio by fiscal year
0.60
65%
2014
2015
2016
2017
2018
55%
50%
45%
40%
2014
2015
2016
2017
2018
35%
30%
25%
Sep-12
Jan-12
20%
May-12
Jan-16
May-16
Sep-15
May-15
Jan-15
Sep-14
May-14
Jan-14
Sep-13
May-13
Jan-13
Sep-12
May-12
Jan-12
0.00
Sep-14
0.10
May-14
0.20
Jan-14
0.30
Sep-13
0.40
May-13
0.50
60%
Jan-13
-5%
Jan-12
0%
Source: Berenberg research, Datastream
4
Banco Popular Espanol SA
Banking
Summary forecasts
Figure 3: Berenberg estimates
Popular – summary forecasts
Net interest income
Fee income
Trading income
Other income
Total income
Personnel expenses
General expenses & amortisation
Total expenses
Financial asset impairment losses
Impairment of other assets
Gains & losses on assets held for sale
Pre-tax profits
Gains / losses on discontinued items
Income tax
Net income
Minorities & AT1 interest
Net attributable income
2008 A
2009 A
2010 A
2011 A
2012 A
2013 A
2014 A
2015 A
2016 E
2017 E
2018 E
EURm
EURm
EURm
EURm
EURm
EURm
EURm
EURm
EURm
EURm
EURm
2,535
865
129
128
3,657
-818
-498
-1,317
-935
-178
233
1,461
40
-390
1,111
-59
1,052
2,823
763
405
64
4,054
-792
-500
-1,293
-1,739
-408
458
1,073
0
-293
780
-14
766
2,432
675
199
92
3,398
-778
-525
-1,303
-1,232
-602
518
779
20
-206
593
-3
590
2,087
686
129
95
2,997
-779
-590
-1,369
-952
-738
507
444
0
40
484
-4
480
2,719
794
360
-95
3,778
-950
-812
-1,761
-4,348
-1,311
150
-3,492
0
1,031
-2,461
0
-2,461
2,411
759
514
-133
3,551
-929
-794
-1,723
-1,254
-1,182
962
354
0
-100
254
-3
252
2,331
655
868
22
3,876
-946
-925
-1,871
-1,664
-414
446
373
0
-43
330
-40
290
2,251
595
563
22
3,431
-936
-806
-1,741
-1,391
-224
39
114
0
-8
106
-84
22
2,106
564
432
26
3,127
-2,051
-3,772
2,033
578
275
80
2,966
-1,550
-778
2,008
595
240
80
2,923
-1,535
-607
-1,349
-75
-75
-4,045
0
1,162
-2,883
-83
-2,966
563
0
-121
442
-84
358
707
0
-163
544
-84
460
1,928
0.13
0.04
31%
6.11
4.65
2,115
0.14
0.06
42%
6.04
4.50
2,115
0.01
0.05
522%
6.01
4.43
3,213
-0.92
0.00
0%
3.76
2.71
4,262
0.08
0.00
0%
2.92
2.13
4,294
0.11
0.03
30%
2.97
2.19
Number of shares (m)
EPS (€)
DPS (€)
Payout ratio
NAV per share (€)
TNAV per share (€)
Main balance sheet items
Gross loans
Net loans
Total assets
Risk-weighted assets
Customer deposits
Shareholders' equity
Tangible shareholders' equity
Efficiency
NII / avg. assets
Income / avg. assets
Cost / avg. assets
Cost / income
Cost / income (ex trading income)
Profitability
RoRWA
RoA
RoE
RoTE
Asset Quality
Financial asset impairment / loans
NPL / total risk bearing assets
NPA / total risk bearing assets
NPL coverage
RE asset coverage
NPA coverage
NPL write-offs / previous year's NPLs
Texas ratio
Capital
CET1 ratio (CRD IV - phased in)
CET1 ratio (CRD IV FL; excl. AFS gains)
Leverage ratio (CRD IV - fully loaded)
93,453
91,702
110,376
51,665
6,734
6,188
97,363
94,956
129,290
59,558
8,416
7,929
98,213
96,032
130,140
79,384
8,776
8,119
98,873
96,771
130,926
88,438
68,743
9,124
8,475
117,299
108,809
157,618
88,757
79,830
10,798
7,796
109,017
101,124
146,709
84,109
89,262
11,774
8,970
108,379
100,583
161,456
79,939
96,036
12,783
9,518
107,085
99,638
158,650
76,087
88,335
12,720
9,381
111,742
100,996
163,224
69,370
12,066
8,709
110,417
101,501
164,040
67,256
12,424
9,067
110,199
102,008
164,860
67,593
12,747
9,389
2.33%
3.36%
1.21%
36%
37%
2.36%
3.38%
1.08%
32%
35%
1.87%
2.62%
1.00%
38%
41%
1.60%
2.30%
1.05%
46%
48%
1.88%
2.62%
1.22%
47%
52%
1.55%
2.29%
1.11%
49%
57%
1.50%
2.49%
1.20%
48%
62%
1.39%
2.12%
1.08%
51%
61%
1.30%
1.93%
1.27%
66%
76%
1.25%
1.82%
0.95%
52%
58%
1.22%
1.78%
0.94%
53%
57%
0.97%
16.2%
17.7%
0.64%
10.1%
10.9%
0.45%
6.9%
7.4%
0.37%
5.4%
5.8%
-2.78%
-1.71%
-24.7%
-30.3%
0.29%
0.16%
2.3%
3.1%
0.35%
0.19%
2.3%
3.0%
0.03%
0.01%
0.2%
0.2%
-4.08%
-1.83%
-22.3%
-29.9%
0.52%
0.22%
3.0%
4.1%
0.68%
0.28%
3.7%
5.1%
1.00%
-
1.82%
-
1.26%
-
0.97%
6.0%
13.3%
34.5%
32.1%
33.2%
-
4.02%
9.0%
15.8%
65.4%
49.0%
58.3%
16.5%
82.5%
1.11%
14.4%
23.0%
40.2%
47.0%
42.7%
13.0%
121.3%
1.52%
13.8%
23.5%
41.4%
40.6%
41.1%
6.4%
112.8%
1.28%
12.9%
23.1%
42.5%
37.9%
40.5%
6.5%
106.8%
3.48%
10.4%
18.1%
70.4%
19.9%
78.2%
0.70%
8.0%
14.0%
76.5%
15.0%
64.6%
0.55%
6.6%
11.5%
85.6%
15.0%
54.2%
-
-
-
-
-
11.2%
6.1%
11.5%
10.4%
5.5%
13.1%
10.9%
6.1%
12.2%
10.3%
5.2%
13.1%
11.1%
5.4%
13.5%
11.6%
5.5%
Source: Berenberg research, company data
5
Banco Popular Espanol SA
Banking
Please note that the use of this research report is subject to the conditions and restrictions set forth in the “General investment
investmentstment -related
disclosures” and the “Legal
“Legal disclaimer” at the end of this document.
country--specific disclosures, please refer to the respective
For analyst certification and remarks regarding foreign investors and country
paragraph at the end of this document.
Disclosures in respect of Article 20 of
of Regulation (EU) No. 596/2014 of the European Parliament and of the
Council of 16 April 2014 on market abuse (market abuse regulation - MAR)
Company
Banco Popular Espanol SA
(1)
(2)
(3)
(4)
(5)
(6)
Disclosures
no disclosures
Joh. Berenberg, Gossler & Co. KG (hereinafter referred to as “the Bank”) and/or its affiliate(s) was Lead Manager or CoLead Manager over the previous 12 months of a public offering of this company.
The Bank acts as Designated Sponsor/Market Maker for this company.
Over the previous 12 months, the Bank and/or its affiliate(s) has effected an agreement with this company for investment
banking services or received compensation or a promise to pay from this company for investment banking services.
The Bank and/or its affiliate(s) holds 5% or more of the share capital of this company.
The Bank holds a long position in shares of this company.
The Bank holds a short position in shares of this company.
Production of the recommendation completed: 24.08.2016, 17:48
Historical price
price target and rating changes for Banco Popular Espanol SA in the last 12 months
Date
14 September 15
03 November 15
18 February 16
27 May 16
31 May 16
24 August 16
Price target - EUR
3.10
2.85
1.70
1.35
1.15
1.00
Rating
Sell
Sell
Sell
Sell
Sell
Sell
First dissemination GMT Initiation of coverage
2015-09-15 07:52
14 September 15
2015-11-04 07:01
2016-02-19 06:50
2016-05-27 07:37
2016-05-31 07:49
-
Click here for a list of all recommendations on any financial instrument or issuer that were disseminated during the preceding 12month period.
Berenberg
Berenberg Equity Research ratings distribution and in proportion to investment banking services on a quarterly basis, as
of 1 July 2016
Buy
Sell
Hold
51.19 %
13.39 %
35.41 %
78.38 %
2.70 %
18.92 %
Valuation basis/rating key
The recommendations for companies analysed by Berenberg’s Equity Research department are made on an absolute basis for
which the following three-step rating key is applicable:
Buy:
Sustainable upside potential of more than 15% to the current share price within 12 months;
Sell: Sustainable downside potential of more than 15% to the current share price within 12 months;
Hold:
Upside/downside potential regarding the current share price limited; no immediate catalyst visible.
NB: During periods of high market, sector, or stock volatility, or in special situations, the recommendation system criteria may be
breached temporarily.
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Bundesanstalt für Finanzdienstleistungsaufsicht -BaFin- (Federal Financial Supervisory Authority),
Graurheindorfer Straße 108, 53117 Bonn and Marie-Curie-Str. 24-28, 60439 Frankfurt am Main, Germany.
6
Banco Popular Espanol SA
Banking
General investmentinvestment - related disclosures
Joh. Berenberg, Gossler & Co. KG (hereinafter referred to as “the Bank”) has made every effort to carefully research all information
contained in this financial analysis. The information on which the financial analysis is based has been obtained from sources which
we believe to be reliable such as, for example, Thomson Reuters, Bloomberg and the relevant specialised press as well as the
company which is the subject of this financial analysis.
Only that part of the research note is made available to the issuer (who is the subject of this analysis) which is necessary to properly
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not claim completeness regarding all the information on the stocks, stock markets or developments referred to in it.
On no account should the document be regarded as a substitute for the recipient procuring information for himself/herself or
exercising his/her own judgements.
The document has been produced for information purposes for institutional clients or market professionals.
Private customers, into whose possession this document comes, should discuss possible investment decisions with their customer
service officer as differing views and opinions may exist with regard to the stocks referred to in this document.
This document is not a solicitation or an offer to buy or sell the mentioned stock.
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Analyst certification
I, Andrew Lowe, hereby certify that all of the views expressed in this report accurately reflect my personal views about any and all
of the subject securities or issuers discussed herein.
In addition, I hereby certify that no part of my compensation was, is, or will be, directly or indirectly related to the specific
recommendations or views expressed in this research report, nor is it tied to any specific investment banking transaction
performed by the Bank or its affiliates.
Remarks regarding foreign investors
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7
Banco Popular Espanol SA
Banking
ThirdThird-party research disclosures
Company
Banco Popular Espanol SA
(1)
(2)
(3)
(4)
(5)
Disclosures
no disclosures
Berenberg Capital Markets LLC owned 1% or more of the outstanding shares of any class of the subject company by the end
of the prior month.*
Over the previous 12 months, Berenberg Capital Markets LLC has managed or co-managed any public offering for the subject
company.*
Berenberg Capital Markets LLC is making a market in the subject securities at the time of the report.
Berenberg Capital Markets LLC received compensation for investment banking services in the past 12 months, or expects to
receive such compensation in the next 3 months.*
There is another potential conflict of interest of the analyst or Berenberg Capital Markets LLC, of which the analyst knows
or has reason to know at the time of publication of this research report.
* For disclosures regarding affiliates of Berenberg Capital Markets LLC please refer to the ‘Disclosures in respect of section 34b of the
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