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Beginning with CBA earnings results in August, Australia's major banks are poised to launch $15 to $28 billion worth of share buybacks during the 2022 financial year according to Morgan Stanley analysts. MS expects a $3.5 billion buyback from Westpac, $4 billion buyback from NAB, and $2.5 billion from ANZ Bank.

Australian Money

Morgan Stanley analysts led by Richard Wiles say that even though they think bank boards will be conservative, the industry still has a large amount of surplus capital. Morgan Stanley believes if banks decide to maintain CET1 ratios of 10.75 per cent to 11.25 per cent, that implies the big four have between $19.5 billion to $28 billion in excess capital.

Banks’ common equity tier 1 (CET1) capital was above 12 per cent of their risk-weighted assets, well above the 10.5 per cent ratio required by regulators. Some of this cash will inevitably be given back the shareholders, but the question is how much.

Morgan Stanley expect the CBA will announce a $5 billion buyback in August which will signal the buybacks will begin fi=or the other major banks. They’re expect  a $3.5 billion buyback from Westpac, a $4 billion buyback from NAB, and a $2.5 billion from ANZ Bank when the bank report their full-year results later in the year.

Source: Morgan Stanley

From The TradersCommunity Research Desk

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