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Lloyds misses out as European banks see 15th quarterly consensus beat

Published 22/05/2024, 11:16
© Reuters.  Lloyds misses out as European banks see 15th quarterly consensus beat

Proactive Investors - European banks outperformed consensus expectations for the 15th consecutive quarter over the first three months of the year, Jefferies analysts have pointed out.

Aggregate pre-tax profits came in 9% above consensus, driven by higher revenues and lower credit costs, analysts said in a note.

This was as 34 banks across the sector outdid expectations, with Lloyds Banking Group PLC (LON:LLOY), Svenska Handelsbanken (LON:0R7R) and Piraeus Bank (AT:BOPr) marking the three to miss out.

Lloyds’ profit, of £1.63 billion, was 2% below consensus, as net interest income and revenues fell short of expectations.

“Once again, this earnings season was characterised by a wide dispersion in net interest income performance,” Jefferies said.

“We continue to see pressure on margins and muted lending growth [and] activity continues to impact,” it added, as central bank rate cuts begin to be priced in.

Standard Chartered (LON:STAN), Societe Generale (EPA:SOGN) and BNP Paribas (EPA:BNPP) were among those to lead the way in terms of profit beats in the meantime.

Though positive profit-beats were “decelerating” against highs in 2022-23, according to Jefferies, “revenue and pre-provision profit continue to surprise”.

“[This confirmed] once again the strong earnings momentum for the sector.”

Read more on Proactive Investors UK


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