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Erste Group Bank AG (EBKDY)
OTHER OTC:EBKDY
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Erste Group Bank AG
(OTC:EBKDY)
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Rating:74Outperform
Price Target:
$58.00
▲(7.73% Upside)
Erste Group Bank AG's stock score is driven by strong technical indicators and positive earnings call outcomes, including record revenues and upgraded guidance. While financial performance shows growth potential, challenges in operational efficiency and cash flow need addressing. Valuation remains attractive, supported by a reasonable P/E ratio and solid dividend yield. Economic uncertainties and cost challenges are notable risks.
Positive Factors
Strong Financial Performance
The record net interest income (NII) indicates robust financial health and effective interest rate management, particularly in Central and Eastern Europe, supporting long-term revenue stability.
Asset Management Growth
Growth in assets under management reflects strong client trust and effective investment strategies, enhancing long-term revenue through increased management fees.
Improved Financial Guidance
Improved financial guidance with a lower cost-income ratio suggests enhanced operational efficiency, supporting sustained profitability and competitive positioning.
Negative Factors
Austrian Real Estate Sector Concerns
Ongoing defaults in the Austrian real estate sector could lead to increased risk costs, impacting profitability and financial stability in the medium term.
Economic Challenges in Austria
A prolonged recession in Austria may suppress loan demand and economic performance, potentially hindering revenue growth and profitability.
Slower Loan Demand in Austria
Weaker loan demand in Austria due to economic conditions could limit revenue growth from lending activities, affecting overall financial performance.
Erste Group Bank AG (EBKDY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$42.17B
Dividend Yield3.21%
Average Volume (3M)1.61K
Price to Earnings (P/E)12.3
Beta (1Y)0.57
Revenue Growth-7.11%
EPS Growth2.78%
CountryUS
Employees45,856
SectorFinancial
Sector Strength70
IndustryBanks - Regional
Share Statistics
EPS (TTM)1.27
Shares Outstanding821,028,750
10 Day Avg. Volume0
30 Day Avg. Volume1,612
Financial Highlights & Ratios
PEG Ratio-0.38
Price to Book (P/B)2.01
Price to Sales (P/S)4.20
P/FCF Ratio-4.75
Enterprise Value/Market Cap2.83
Enterprise Value/Revenue8.53
Enterprise Value/Gross Profit10.67
Enterprise Value/Ebitda39.05
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Erste Group Bank AG Business Overview & Revenue Model
Company DescriptionErste Group Bank AG provides a range of banking and other financial services to retail, corporate, real estate, and public sector customers in Austria, Central and Eastern Europe, and internationally. The company operates through Retail, Corporates, Group Markets, Asset/Liability Management & Local Corporate Center, Savings Banks, and Group Corporate Center segments. It provides mortgage and consumer loans, investment products, current accounts, savings products, and credit cards, as well as cross selling products, such as leasing, insurance, and building society products. The company also offers factoring and accounts receivable purchasing; investment, acquisition and leveraged, project, and commercial real estate finance; interest rate and currency hedging, letters of credit, documentary collections, and guarantees; account management, payments, digital-banking, and cash logistics services; equity interests and investments, revolving export credits lines, customer financing, and export guarantee; and loan syndication, and debt and equity capital market services. In addition, it provides cash management, trade finance, customer referral, markets execution, and custody and brokerage services. Further, the company offers corporate finance; portfolio management; trading and market; trade execution, market making, and short-term liquidity management; and asset/liability management services, as well as working capital and bridge loans. As of December 31, 2021, it operated 2,091 branches. The company was founded in 1819 and is headquartered in Vienna, Austria.
How the Company Makes MoneyErste Group Bank AG generates revenue primarily through interest income from loans and advances to customers, which constitutes a significant portion of its earnings. The bank also earns money through fees and commissions associated with various banking services, such as account maintenance, transaction processing, and advisory services. Additionally, Erste Group benefits from its investment banking activities, including underwriting services and asset management. The bank has established strategic partnerships and collaborations that enhance its service offerings and market reach, contributing to its overall profitability. Key factors influencing its earnings include interest rate fluctuations, regulatory changes, and economic conditions in the regions where it operates.
Erste Group Bank AG Earnings Call Summary
Earnings Call Date:Oct 31, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 26, 2026
Earnings Call Sentiment Positive
The earnings call reflected strong financial performance with record-breaking revenues and profitability. The integration of Santander Polska and upgraded financial guidance are positive signs. However, challenges such as elevated operating costs, increased banking taxes, and economic uncertainties in key markets pose risks.Q3-2025 Updates
Positive Updates
Record-Breaking Revenue and Profitability
Erste Group posted quarterly revenues exceeding EUR 2.9 billion for the first time, supported by a record net interest income of close to EUR 2 billion and fees of almost EUR 800 million. The return on tangible equity was 18% for the quarter.
Strong Loan and Deposit Growth
Customer loan volumes increased by almost EUR 10 billion year-to-date, with a growth rate exceeding 5%. Deposits grew by 2.5% year-to-date, with core retail and SME deposits increasing by 2.4%.
Upgraded Financial Guidance for 2025
The guidance for net interest income growth was upgraded to more than 2%, and the cost/income ratio target was improved to around 48%.
Integration of Santander Polska on Track
Erste Group is progressing well towards the consolidation of Santander Polska, expecting approval by year-end 2025, with all competition authority approvals received.
Negative Updates
Elevated Operating Costs
Operating costs increased by 8% year-on-year due to higher staff costs and IT expenses. Although efforts are underway to reduce cost inflation, it remains a challenge.
Higher Banking Taxes
Increased banking taxes in Austria and Romania have impacted the financials negatively.
Potential Impact of Polish Bank Tax
There is uncertainty regarding the impact of a proposed increase in the Polish bank tax, which could affect the profitability of the Santander Polska acquisition.
Risk of Economic Slowdown in Key Markets
The Austrian economy struggled to produce growth, and the German economy is expected to flatline, which could pose challenges for future growth.
Company Guidance
During the Erste Group's third quarter 2025 results conference call, the company provided several key financial metrics and guidance updates. Erste Group achieved a record quarterly revenue exceeding EUR 2.9 billion, driven by a net interest income of nearly EUR 2 billion and fees of almost EUR 800 million, both quarterly records. The company saw a strong loan growth, with customer loans increasing by over EUR 10 billion since the start of the year, supported by robust volume dynamics across Central and Eastern Europe. The cost/income ratio is expected to be around 48% for the full year, improved from the previous expectation of below 50%. The return on tangible equity for the third quarter was flat at 18%, and the company adjusted its net interest income growth guidance for 2025 to more than 2%. Erste Group expects to maintain its risk costs at about 20 basis points for the year. The CET1 ratio is projected to exceed 18.5% by year-end if the Santander Polska acquisition does not close before then, and over 14% if it does. Looking ahead, Erste Group anticipates continued positive operating leverage and growth momentum, projecting a return on tangible equity of about 19% for the combined entity in 2026.Erste Group Bank AG Financial Statement Overview
Summary
Erste Group Bank AG shows a robust financial profile with strong revenue growth and profitability metrics. The balance sheet is stable with prudent leverage, and cash flows are effectively managed, though some historical volatility is noted. Continued focus on operational efficiencies and cash flow stability is recommended.Income Statement
The company has demonstrated strong revenue growth with a TTM revenue increase from the previous year. Gross profit margin and net profit margin are healthy, indicating efficient cost management and profitability. However, the EBITDA margin is relatively low, suggesting limited operational efficiency improvements.75
Positive
Balance Sheet
Erste Group Bank AG exhibits a strong balance sheet with a healthy equity ratio, suggesting stability and financial resilience. The debt-to-equity ratio is manageable, highlighting prudent leverage levels. Return on equity is robust, indicating effective use of shareholder equity to generate profits.65
Positive
Cash Flow
The cash flow statement reflects a solid operating cash flow to net income ratio, showcasing effective cash generation. Free cash flow growth is positive, but historical fluctuations in cash flow suggest potential volatility. The free cash flow to net income ratio is strong, indicating good cash conversion from profits.60
Neutral
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 14.00B | 22.48B | 22.58B | 13.69B | 9.21B | 8.96B |
| Gross Profit | 11.19B | 10.89B | 10.32B | 8.40B | 7.60B | 7.17B |
| EBITDA | 3.06B | 5.55B | 5.43B | 3.82B | 3.54B | 1.98B |
| Net Income | 3.16B | 3.13B | 3.00B | 2.17B | 1.92B | 783.10M |
Balance Sheet | ||||||
| Total Assets | 361.07B | 353.74B | 337.15B | 323.87B | 307.43B | 277.39B |
| Cash, Cash Equivalents and Short-Term Investments | 41.68B | 42.75B | 51.43B | 35.68B | 61.92B | 52.60B |
| Total Debt | 55.52B | 52.58B | 44.43B | 36.57B | 32.72B | 31.24B |
| Total Liabilities | 328.47B | 322.97B | 308.65B | 298.56B | 283.91B | 254.98B |
| Stockholders Equity | 24.65B | 23.14B | 21.65B | 19.35B | 18.00B | 17.34B |
Cash Flow | ||||||
| Free Cash Flow | 2.62B | -9.78B | 2.06B | -9.29B | 10.86B | 23.94B |
| Operating Cash Flow | 3.40B | -9.03B | 2.59B | -8.81B | 11.40B | 24.49B |
| Investing Cash Flow | -981.00M | -850.00M | -599.00M | -233.00M | -483.40M | -351.60M |
| Financing Cash Flow | -938.00M | -1.55B | -1.02B | -756.00M | -1.31B | 1.13B |
Erste Group Bank AG Technical Analysis
Positive
53.84
Price Trends
50.16
Positive
48.67
Positive
42.59
Positive
Market Momentum
0.64
Positive
55.83
Neutral
23.10
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EBKDY, the sentiment is Positive. The current price of 53.84 is above the 20-day moving average (MA) of 51.75, above the 50-day MA of 50.16, and above the 200-day MA of 42.59, indicating a bullish trend. The MACD of 0.64 indicates Positive momentum. The RSI at 55.83 is Neutral, neither overbought nor oversold. The STOCH value of 23.10 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for EBKDY.
Erste Group Bank AG Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $76.03B | 11.20 | 11.69% | 4.13% | 2.91% | 33.77% | |
74 Outperform | $42.17B | 12.30 | 14.12% | 3.21% | -7.11% | 2.78% | |
74 Outperform | $74.83B | 10.18 | 19.90% | 5.91% | 11.82% | 3.41% | |
74 Outperform | $29.24B | 11.72 | 9.60% | 3.05% | -0.81% | 20.34% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
65 Neutral | $59.25B | 12.42 | 7.98% | 4.50% | 22.02% | ― | |
64 Neutral | $70.30B | 16.03 | 7.85% | 3.40% | -20.94% | -18.71% |
* Financial Sector Average
EBKDY
Erste Group Bank AG
53.84
27.23
102.33%
TFC
Truist Financial
46.24
0.81
1.78%
ITUB
Itau Unibanco
7.66
3.15
69.84%
LYG
Lloyds Banking
4.98
2.40
93.02%
MTB
M&T Bank
190.24
-23.65
-11.06%
USB
US Bancorp
48.95
-2.05
-4.02%
Erste Group Bank AG Corporate Events
Erste Group’s Earnings Call: Record Revenues Amid Challenges
Nov 4, 2025
Erste Group Bank AG’s recent earnings call conveyed a strong financial performance, highlighted by record-breaking revenues and profitability. The integration of Santander Polska and upgraded financial guidance are positive developments. However, challenges such as elevated operating costs, increased banking taxes, and economic uncertainties in key markets present potential risks.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.