Komercni Banka: Komercni Banka decided to buy back shares in a coming period

According to Bloomberg Komercni Banka has announced that it will buy back shares following the recent drop in price. The bank’s AGM approved buying back up to 3.8m (or 10%) of shares with the price limit of CZK 4,500 but this is the first time the bank appears prepared to implement a buyback policy. We see this move as positive giving that the bank’s tier 1 ratio of 13.3% at the end of 1Q06. This also follows the payment of a dividend of CZK 250 per share (equating to a payout of 104% of the 2005 unconsolidated net profit). That demonstrates more active capital management that we have seen in the past. We reiterate our Buy rating with fair value of CZK 4,321.