Barclays rearranged its recommendations for a group of high-profile European banks on Monday, lowering its view on Deutsche Bank and upgrading Commerzbank, UBS and Julius Baer. The bank cited slower-than-expected German growth, UniCredit’s approach to Commerzbank, and easing integration risks at UBS following Credit Suisse developments.
Deutsche Bank
Barclays reduced its rating on Deutsche Bank to "equal weight" from "overweight" and cut its price target to €32 from ;€39. Barclays trimmed its 2026-28 earnings per share (EPS) estimates for Deutsche Bank by 4-8%, leaving those forecasts 3-7% below the company-compiled consensus.
The research note calculates the bank is trading at roughly 9.5x 2026 estimated P/E and 0.88x 2026 estimated price-to-tangible book value, with an estimated 11% return on tangible equity in 2027. Barclays highlighted Deutsche Bank ;s private credit exposure, noting a portfolio of ;€25.9 billion that corresponds to 53% of CET1 and 43% of tangible book value at year-end 2025.
Barclays also noted capital return progress: Deutsche Bank had completed 59.8% of a ;€1 billion share buyback as of April 10, leaving about ;€0.4 billion still to be executed.
Commerzbank
Commerzbank was promoted to "overweight" from "equal weight," with Barclays raising its price target to ;€42 from ;€36. The research team increased its 2026-28 EPS estimates for the lender by 2-8%.
Valuation metrics referenced in the note show Commerzbank trading at 9.0x blended two-year forward P/E. Barclays expects an EPS compound annual growth rate of about 30% through 2025-28, the highest among its covered European banks.
Barclays observed that Commerzbank ;s shares were trading roughly 3% above UniCredit ;s offer price, which Barclays sees as a valuation floor tied to UniCredit ;s move.
The bank ;s ;€156 billion replicating portfolio, reported with about a 3.5-year duration at end-2025, is expected to see an estimated uplift of ;€30 million per quarter from higher EUR swap rates, Barclays said. New financial targets for Commerzbank are slated to be announced alongside first-quarter 2026 results on May 8.
UBS
Barclays upgraded UBS to "equal weight" from "underweight," nudging up the price target to CHF 34 from CHF 33. The brokerage was described as trading at 14x 2026 estimated P/E and 1.53x 2026 estimated price-to-tangible book value, with Barclays' model pointing to an estimated 13% return on tangible equity in 2027.
Barclays flagged a potential catalyst tied to a Swiss Federal Council update on capital requirements expected around April 22, writing that the ordinance portion is "more likely to be neutral-to-positive vs current market fears." Under the June 2025 proposal, Barclays estimated an approximate CET1 capital hit of $11 billion at the group level, while noting a separate potential $20 billion impact from proposed foreign subsidiary capital rules remains subject to parliamentary debate.
The research house left UBS's underlying EPS estimates broadly unchanged for 2026-28, within +/-1%.
Julius Baer
Julius Baer was upgraded to "overweight" from "equal weight," and Barclays raised its price target to CHF 71 from CHF 63.70. The firm modestly lifted 2026-28 EPS estimates for Julius Baer by 1-2%.
Barclays calculated Julius Baer had excess capital of around CHF 770 million above a 14% CET1 buyback threshold, equivalent to roughly 6% of market capitalization. The bank's two-year forward blended P/E of 10.1x sits slightly below its long-term median of 10.3x since 2015, according to Barclays.
Barclays also noted that a FINMA formal enforcement procedure, which intensified in February 2025 following the Signa group collapse, "could conclude over the coming months."
Collectively, the rating changes and forecast adjustments reflect Barclays' view that German GDP acceleration has been pushed out - the research note suggests faster growth is now more likely in 2027 rather than 2026 - and that evolving M&A and regulatory dynamics in Switzerland and Germany are recalibrating relative valuations and risk perceptions across the covered banks.