Top broker Macquarie has released a note on ASX 200 bank shares, revealing each stock's latest rating and share price target.
A share price target represents a broker's best guess regarding where the stock will be trading in 12 months.
Seven of the eight ASX 200 bank shares are covered in the note (Macquarie has not rated itself).
The note reveals one glaringly common thread among the ASX 200 bank shares.
Not a single bank has a buy rating.
Let's take a look.
Macquarie re-rates ASX 200 bank shares
Westpac Banking Corp (ASX: WBC)
The broker has placed an underperform rating on Westpac shares with a price target of $28.
Westpac shares are trading for $31.73 on Tuesday, up 0.51%.
Macquarie says:
WBC remains expensive, trading at approximately 17x FY26E P/E (in line with NAB and at a 26% premium to ANZ).
With execution risks around the transformation programme, we continue to see risk to WBC's earnings and multiple.
Commonwealth Bank of Australia (ASX: CBA)
Macquarie has an underperform rating on Australia's largest ASX 200 bank share.
It has a 12-month price target of $105 for CBA shares.
CBA shares are trading for $151.76 on Tuesday, up 0.55%.
In its note, the broker commented on trends in non-performing loans and the differing management styles between the banks.
Trends appear stable or improving for CBA and WBC. ANZ is broadly stable, while NAB has experienced slow deterioration across both portfolios.
Although the root cause of this divergence remains unclear (hence investor concern), it may potentially be explained by the differences in the management of loans in arrears — for example, peers such as CBA appear to be more proactive and pre-empt customers entering the non-performing stage and restructure the loan before it becomes non-performing.
NAB's approach appears more passive, resulting in larger or stickier arrears.
National Australia Bank Ltd (ASX: NAB)
The broker has given NAB a neutral rating with a share price target of $35.
NAB shares are changing hands for $34.35 apiece, up 0.98%.
Macquarie says:
NAB's relatively worse credit metrics are a concern for investors: The market is increasingly concerned with divergent credit quality trends for NAB.
While it is difficult to identify a specific reason … we suspect this may be due to differences in banks' approaches to managing arrears and troublesome customers rather than fundamental credit quality differences.
ANZ Group Holdings Ltd (ASX: ANZ)
Macquarie has a neutral rating on ANZ shares with a price target of $28.
The ANZ share price is currently $29.39, up 1.03%.
In terms of lending across key sectors of the economy, Macquarie notes that ANZ has the lowest exposure to commercial real estate and the highest exposure to manufacturing of the Big Four Banks.
Bendigo and Adelaide Bank Ltd (ASX: BEN)
The rating for Bendigo and Adelaide Bank shares is underperform.
Macquarie expects the Bendigo share price to be trading at about $10 in 12 months.
Bendigo shares are $10.73 apiece at the time of writing, up 0.94%.
Bank of Queensland Ltd (ASX: BOQ)
Bank of Queensland shares are also expected to underperform.
Macquarie predicts this ASX 200 bank share will fall over the year to land at about $5.75 apiece.
The Bank of Queensland share price is $6.78, up 0.59% today.
Judo Capital Holdings Ltd (ASX: JDO)
The broker has applied a neutral rating to Judo Capital shares with a 12-month price target of $1.85.
The Judo share price is currently $1.82, down 0.71%.
