NOBA Bank Group (NOBA.ST): Model Update

Citi updates its NOBA Bank Group model for the latest rates and market developments and makes minor changes (c.2%) to its 2026-28 EPS estimates. The target price is lowered to SKr86 from SKr89 while the Neutral rating is reiterated. At the current share price of SKr88.70, the expected total return is 1.9%, comprising a 5.0% dividend yield and a 3.0% expected share price decline. Valuation combines a dividend discount model with warranted equity value, assuming a cost of equity of about 14% and long-term growth of about 7%. Key risks include slower growth as core markets mature, removal of interest tax deductibility on Swedish consumer credit, and higher funding costs if deposit retention weakens.