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Nov 5 2019, 07:35 GMT
AIB Group
Q3 update: NPEs lower but excess liquidity hits margin
DAVY VIEW
Non-performing exposure (NPE) momentum, evidence of cost action and mortgage market share gains are the standout positives, with the former driving a modest improvement in the 2020 SREP capital requirement. Looking through the TRIM impact, a weaker CET1 outlook reflects lower profitability due to an excess liquidity drag on the margin, IFRS 9-related impairment volatility and continuing high H2 exceptional costs. Overall, we expect to reduce our FY19 pre-exceptional PBT forecast by a low- to-mid-single-digit percentage and CET1 by 50bps (30bps of which is a timing issue).
