The latest Market Talks covering Financial Services. Exclusively on Dow Jones Newswires at 4:20 ET, 12:20 ET and 16:50 ET.
0811 ET – The headline figures for Assicurazioni Generali seem in line with expectations, which is a good thing, Keefe, Bruyette & Woods says in a note after the Italian insurer’s first-half print. “We cannot see any drama on the non-operating items or book values that have hurt peers recently,” analyst William Hawkins writes. The results don’t seem to have overly affected the share price in any direction, he says, adding that it may be reassuring that there is no financial or strategic drama. The insurer separately said it had received and responded to a letter from Mediobanca on its offer to buy Banca Generali, but the statement didn’t offer any material update on Generali’s views, he adds. Shares rise 3.1% to 51.25 euros. (elena.vardon@wsj.com)
0557 ET – UBS raises its earnings per share (EPS) estimates for most European asset managers for 2025 to 2027. The move follows lower-than-expected costs during the second quarter earnings period, and stronger inflows into European funds, UBS analysts say in a note. “On the back of the results, we raise our EPS estimates for Jupiter, DWS, Schroders, and Aberdeen and lower our EPS estimates for Amundi,” they say. (miriam.mukuru@wsj.com)
0526 ET – ABN Amro is the worst performer of Amsterdam’s blue chip index after the Dutch bank’s second-quarter results dragged shares 7% lower. While the lender beat profit expectations, lighter revenue and a smaller buyback disappointed. Still, the inclusion of a buyback points to rising confidence, UBS analyst Johan Ekblom says in a note to clients. “We have previously argued that the important point is that there is a buyback, more than the size. To us this clearly signals a new era for ABN, one in which they are confident in the [risk-weighted assets] trajectory and future capital consumption,” he says. The stock is down to 23.12 euros, its lowest price in more than a month, though its year to date gains still stand at 55%. (elena.vardon@wsj.com)
0507 ET – Shares in Banca Monte dei Paschi di Siena rise 4% to 7.78 euros after the Italian bank’s second-quarter results beat expectations. The main surprises came from higher income from interest and trading as well as lower cost of risk, Equita analyst Andrea Lisi says in a note. The group’s capital measure—its CET 1 ratio—was stable on quarter at 19.6% and is one of the highest in the industry, giving it room to improve its takeover offer for Mediobanca. In a presentation to analysts, the bank revised its standalone guidance for pretax profit to more than 1.5 billion euros for the year, up from 2024’s result of 1.45 billion euros. (elena.vardon@wsj.com)
0456 ET – Hiscox delivered a strong set of results, JP Morgan Cazenove analysts write in a note. The specialist insurer increased its current share buyback program to $275 million, mainly driven by growth in its retail business. The results provide sufficient evidence to support the early stages of the company’s plan set in May at its capital markets day, the analysts say. While there might be concerns about reserve releases and the overall quality of the results, large reserve releases is a sign of a well-managed business, they add. Shares are up 7.8% at 1,358 pence. (najat.kantouar@wsj.com)
0451 ET – Metro Bank’s confirmation that it won’t have to comply with MREL regulations anymore represents a material upside to its strategic plan and targets, RBC Capital Markets says in a research note. Alongside the U.K. challenger bank’s first-half results, in which it reiterated all its guidance, the group confirmed that from early 2026 it will become a transfer firm—from a bail-in firm previously under Bank of England rules—and won’t need to hold MREL debt anymore. “We estimate that this softening of regulation represents [around 55 million pounds per year] potential upside to the bank’s existing strategic plan,” analysts write. They add that this represents around 20% of the pretax profit estimates for 2027. Shares fall 1.8% to 122 pence, reversing earlier gains of up to 5.4%. (elena.vardon@wsj.com)
0326 ET – Quilter has shown considerable operational momentum over the last 18 months, reflected in enhanced net inflows and improving profit margins, RBC Capital Markets analysts say in a note. The wealth management company delivered a first-half adjusted pretax profit 6% ahead of market expectations on lower-than-expected costs, though it is guiding for higher second-half costs, leaving full-year expectations around 1.5% ahead of market consensus, RBC says. The business looks well positioned to deliver strong earnings-per-share growth and attractive capital returns, RBC says. Quilter’s substantial adviser network would be appealing to any large-scale financial institution looking to expand into the U.K. market, leaving it looking like a potential takeover target, analysts add. RBC retains its outperform rating and 170 pence price target. Shares are down 2.8% at 158.8 pence. (joseph.hoppe@wsj.com)
0256 ET – Legal & General’s half-year print showed some weakness in its balance sheet, which might set up shares for some downside, Keefe, Bruyette & Woods says in a research note. “Net earnings are a big miss and this leads to a steep decline to a miss in IFRS equity and [contractual service margin],” analyst William Hawkins writes. He adds that the slightly weaker solvency ratio—at 217% against consensus’s 220%—masks a bigger miss in own funds and should weigh on the stock. However, L&G posted a beat in operating profits and reassuring premium and flow figures in pension risk transfer and asset management, he adds. (elena.vardon@wsj.com)
0248 ET – ABN Amro’s second-quarter revenue trends are disappointing and the size of the share buyback is below expectations, RBC Capital Markets says in a note. Consensus penciled in a 517 million euro buyback this year, though RBC’s forecast aligned with the 250 million euro program that was announced. The lender’s top line was softer than expectations on lower net interest income and fees. “We expect some weakness in the shares on the back of this,” analyst Anke Reingen and associate Matthew Russell write. They also highlight the Dutch bank’s cost control and capital ratio, which were better than expected and are long-term drivers, underpinning the investment case. (elena.vardon@wsj.com)
0244 ET – UBS Group’s earnings matter, given that the bank needs to generate capital to comply with Switzerland’s proposal to toughen its banking rules, RBC Capital Markets’ Anke Reingen and Matthew Russell say in a research note. “The best defense against upcoming regulatory changes is capital generation,” the analysts say. In that regard, the Swiss bank’s second-quarter results showed encouraging trends thanks to an improvement in profitability, RBC says. “There is room for the proposed regulation to soften but we are not banking on this,” RBC says. Some regulatory relief and upgrades to consensus expectations could drive the shares higher, the analysts say. RBC lifts its target price on UBS to 31.50 Swiss francs from 29 francs. Shares closed at 30.17 francs Tuesday. (adria.calatayud@wsj.com)
0139 ET – Banco BPM’s posted earnings ahead of expectations and stuck with its guidance though consensus is already there, Keefe, Bruyette & Woods says in a research note. The Italian lender’s second-quarter print was messier than usual due to restatements—which weren’t reflected in consensus—as well as one-offs and the consolidation of Anima, the asset manager it recently purchased. The guidance implies a lower run-rate in the second half than in the first but management said the latter part of the year is usually worse in terms of fees, they pencil in another interest rate cut and they want to be conservative on cost of risk due to the macroeconomic uncertainty. “We think these results do not change the equity story materially,” analysts Hugo Cruz and Ben Maher write. (elena.vardon@wsj.com)
