UmweltBank AG: Strategic Growth and Investment Outlook

UmweltBank AG recently held its first Capital Markets Day on January 15, 2025, outlining a strategic roadmap through 2028. The focus was on the expansion of their deposit business to boost net interest and commission income. The bank projects an increase in private customer deposits to €3.5 billion in 2024, up from €2.5 billion in 2023, thanks in part to their 'UmweltFlexkonto' offering.

The company's Corporate segment growth, particularly in sustainable loan financing, hinges on enhancing their capital base. With a capital ratio of 16.9%, UmweltBank plans to acquire additional equity by reducing capital surcharge and selling equity investments by 2026. Projections suggest significant net interest income growth from 2025, driven by enhanced deposit conditions at the ECB.

Additionally, UmweltBank anticipates a rise in net commission from expanding their fund business, including new ETFs. Administrative expenses are expected to increase marginally, with a target cost-income ratio below 60% by 2028. Despite a predicted flattening in earnings growth from 2027, the current "Buy" recommendation for UmweltBank remains affirmed, with a price target set at €10.00.