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Bank of America: "Santander is unattractive due to weak balance sheet in Spain"


"Santander is unattractive due to its weak balance sheet in Spain"and for his"tight capital position". It is the valuation made by the analysts of Bank of America after the annual results published by the entity.

These analysts have reiterated their advice from underweight in the portfolios the shares of Santander, with a valuation of 2 euros per share, well below the current market price.

In his opinion, 6% rise in doubtful assets (NPLs) in Spain Compared to the previous quarter, up to 611 million euros is a negative figure for the entity's balance sheet, which makes its valuation less attractive.

As positive factors, the "positive quarterly trajectory"of the interest margin, except in Poland and USA and with him United Kingdom and Chile as the main contributors to growth. "

Bank of America's valuation contrasts with that made by Bankinter, which has raised its target price to 2.95 euros per share from 2.35 euros.

"The key for 2021/2022 is in the guidance (Cost of Risk, Capital and dividends). On these three fronts we estimate a change for the better thanks to the macro recovery, the efficiency improvements in Europe and the evolution of exchange rates (Libra and Emerging) ", their analysts have indicated.

In addition, they highlight that "the management team launches positive guidance for 2021 (Ordinary RoTE ~ 9.0% / 10% vs 7.4% current), Efficiency

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