Banca Transilvania, Bank Pekao, First Investment Bank (Fibank) and Turkey’s VakıfBank offer four different ways to invest in regional banking. Transilvania combines fee growth with positive operating leverage, Pekao offers a substantial dividend, and Fibank trades at a discount to tangible book. VakıfBank adds a much larger lending franchise with declining capital ratios and a deteriorating credit trend.
The differences go well beyond size. Fibank’s discount comes with questions about asset quality. Pekao’s dividend appeal sits alongside pressure on interest margins. Transilvania’s first-half growth supports its valuation, which already asks for continued delivery. VakıfBank shows how sharply higher net interest income can coexist with weaker capital ratios and little improvement in operating earnings.
The comparison uses information available as of 22 October 2026, with reporting dates shown alongside the figures. Share-price observations for the original three banks remain those of 20–21 October.
Size: VakıfBank leads in euros, Transilvania in domestic economic weight
State-controlled VakıfBank ranks second by assets in Turkey, while Pekao is Poland’s second-largest universal bank. Transilvania is Romania’s largest bank, and Fibank ranks fifth in Bulgaria. VakıfBank’s consolidated balance sheet is about 30% larger than Pekao’s and roughly eleven times Fibank’s in euro terms.
Relative to their home economies, the gap is much smaller. Transilvania has the largest balance sheet relative to domestic GDP, while the other three fall in a relatively narrow 8.4%–9.0% range. A €9.8bn Bulgarian bank and a €108.8bn Turkish group can therefore carry similar weight relative to their own economies.
The GDP comparison gives a sense of scale. It compares year-end group assets with annual economic output, including foreign subsidiaries in the asset total. Domestic rankings refer to the local banks; the asset figures are consolidated. Euro amounts use year-end 2025 exchange rates, and the GDP denominators incorporate the latest available revisions, with Romania’s figure still provisional.
Capital: VakıfBank’s CET1 has fallen
The disclosed ratios for Transilvania, Pekao and Fibank imply substantial calculated headroom above their disclosed capital requirements. VakıfBank’s capital ratios moved lower: its CET1 ratio fell from 11.75% at December 2025 to 9.856% at June 2026.
Once the requirements are taken into account, Pekao and Fibank have broadly similar CET1 cushions in percentage points. Transilvania has somewhat more headroom. The Transilvania and Fibank requirement figures are calculated from the disclosed components.
VakıfBank disclosed additional CET1 buffers of 4.035%. Adding a 4.5% base CET1 minimum gives an illustrative 8.535% threshold and approximately 1.32 percentage points of headroom, before any other institution-specific requirements. This is a partial benchmark, not verified full supervisory headroom; it cannot support a ranking against the other banks’ cushions. Changes to regulatory FX treatment at the start of 2026 contributed to the risk-weighted-asset comparison, so the decline in ratios cannot be attributed entirely to new lending.
The calculated buffers at Transilvania, Pekao and Fibank support the capacity to lend and absorb losses. Growth still uses capital, however: Transilvania’s risk-weighted exposures grew faster than CET1 capital in H1, while Pekao’s capital requirements increased faster than own funds. Sustained balance-sheet expansion will need continued earnings retention.
Tangible equity provides another perspective. Transilvania’s tangible common equity/assets ratio was approximately 8.34% at June 2026, excluding AT1 instruments. Fibank’s corresponding ratio was around 9.94% at September 2026. VakıfBank’s June ratio was approximately 6.08%, leaving a thinner tangible-equity layer. Its reported regulatory leverage ratio of 5.43% was above the stated 3% minimum. The accounting and regulatory measures have different definitions, but both underline the need to judge growth alongside capital capacity.
Credit quality: Fibank’s mixed recovery meets VakıfBank’s rising NPLs
The loan books help explain why the banks should carry different risk assessments.
Transilvania has a broad enterprise and retail mix. At June 2026, corporate and public-institution exposures were 38.8% of gross loans and finance leases, with SMEs another 12.6%. Mortgages accounted for 21.2%, consumer/card lending 17.1%, and non-bank financial-institution/lease exposures 10.2%. The latter category grew about 40% year on year, while consumer/card lending increased roughly 18%. Those are the areas where underwriting deserves particular attention as the portfolio expands.
Mortgage products are a large part of Pekao’s loan book. Mortgages represented 44.5% of its PLN 203.5bn gross customer-loan product table at June 2026. Cash and card balances were 10.3%, and finance leases 6.7%. On a separate customer breakdown, corporate borrowers represented about 54.8% of loans and finance leases, excluding non-treasury debt securities. Product and customer classifications overlap, so the mortgage category should not be read as entirely residential household lending.
Fibank remains more weighted toward enterprise lending. Large companies, SMEs and micro-enterprises together accounted for 57.9% of gross loans at September 2026. Residential mortgages were 22.8%, consumer loans 17.9%, and cards 1.4%. Mortgages grew 14.9% over the first nine months, adding a growing household component to the portfolio.
VakıfBank reports a high commercial share on its broad customer classification. Commercial loans accounted for 81.4% of performing loans at June 2026, with individuals at 18.6%. Its retail book included TRY 222.6bn consumer loans, TRY 269.1bn individual cards and TRY 135.3bn overdrafts. These balances describe a different risk mix from a mortgage-heavy book, and the commercial share is not a measure of commercial-property exposure.
Stage 3 identifies credit-impaired exposures. Transilvania’s measure covers loans and leases, Pekao’s also includes non-treasury debt securities and excludes reverse repos, and Fibank’s uses gross customer loans. VakıfBank reports an NPL ratio and the corresponding loan allowances, rather than an identically defined Stage 3 measure. Its commercial/individual split above uses performing loans. The table gives a useful comparison of credit stress and provisioning, with those differences in scope.
Transilvania’s Stage 3 share fell from 3.38% a year earlier as lending grew faster than impaired exposures. Pekao’s Stage 3 balances also grew more slowly than their exposure base.
Fibank’s picture is more mixed. Its Stage 3 share improved from 7.96% at year-end 2025 to 6.39%, but loans more than 90 days overdue rose from 3.85% to 4.65% of gross loans. The decline in impaired balances is encouraging; the increase in arrears makes the next few quarters particularly important.
VakıfBank’s direction is more clearly adverse. NPLs rose from TRY 89.43bn at December 2025 to TRY 115.97bn at June 2026, with the reported NPL ratio increasing from 2.89% to 3.31%. Total allowance coverage fell from 113.6% to 107.8%. The rising NPL stock and declining reserve cushion warrant attention.
Provision coverage reinforces that distinction. Fibank’s allowance coverage remains an important consideration. Recoveries and collateral matter, so coverage below 100% alone does not establish insufficient provisioning. It does mean the discounted valuation needs to be assessed alongside the quality and recoverability of the loan book.
Earnings: revenue growth is only part of the comparison
Transilvania delivered positive operating leverage in H1 2026. H1 2026 operating income rose 17.2%, while expenses increased 8.9%. Calculated operating earnings before provisions grew approximately 28.4%, and net fee income rose 18.0%. Estimated annualised ROE was around 20.9%.
The fee growth matters because it gives the bank a recurring source of income alongside lending. Trading and valuation gains also supported the result, making the composition of future growth worth watching. Estimated net interest margin eased to about 3.75%, but the bank still grew net interest income.
Pekao is feeling the effect of lower rates. Its H1 2026 net interest margin fell to 3.8% from 4.3% a year earlier. Operating income barely increased while costs rose 7.3%, reducing the simple operating-income-less-costs measure before provisions by approximately 2.7%.
Reported ROE remained 15.7%, and cost/income including Bank Guarantee Fund contributions was 38.9%. Net fees grew 11%, providing some support as the interest margin narrowed. The challenge is to keep that fee and volume growth ahead of costs. CHF mortgage litigation also remains relevant, with accumulated legal-risk costs of PLN 2.05bn at June 2026.
Fibank’s rebound needs a closer look at the components. Its nine-month net interest margin improved to 3.14% from 3.06%, and reported ROE reached 12.63%. Banking operating income rose 32.8%, helped by an unusually weak bond-related comparison period.
Excluding other net operating income, net interest income, net fees and trading income together grew around 10.3%, close to administrative-cost growth of 10.6%. Net fees fell 9.4%. The headline recovery therefore looks stronger than the improvement in recurring operating performance.
VakıfBank’s net interest income more than doubled, but operating earnings barely moved. H1 2026 net interest income rose about 104% to TRY 109.4bn, while net fees increased roughly 27% to TRY 41.1bn. Yet operating expenses grew about 56%, faster than gross operating income at around 20%. Calculated pre-provision operating earnings declined approximately 0.5%.
A swing from a TRY 10.7bn trading gain to a TRY 12.7bn loss absorbed part of the improvement. Reported annualised ROAE was 18.55% and ROAA 1.18%, below their December 2025 readings. These are nominal lira returns: inflation and exchange-rate changes matter to an investor’s real or euro-denominated outcome. A common NIM was not established for VakıfBank, so the jump in interest income should not be read as proof of margin expansion.
Transilvania’s NIM is estimated, while Pekao and Fibank report their own ratios. Differences in tax and guarantee-fund treatment also affect cost/income comparisons. The clearest signal is the direction of revenues and costs within each bank: Transilvania is improving that relationship, Pekao is under pressure, Fibank’s recovery still relies partly on a favourable comparison, and VakıfBank’s interest-income rebound has yet to overcome costs and trading volatility.
Funding: VakıfBank uses more of its deposit base
Transilvania, Pekao and Fibank retain sizeable deposit buffers relative to lending. Transilvania’s standalone loan/deposit ratio was 65.9% at June 2026, compared with approximately 71.5% for Pekao’s group at June and 68.0% for Fibank’s group at September. Pekao’s numerator includes reverse repos, so these figures are indicators of funding structure rather than a strictly uniform ranking.
VakıfBank operates closer to the limit of its deposit base. Its gross loan/deposit ratio was approximately 97.4% at June 2026, including interbank deposits in the denominator. Using performing loans, the bank reports 94.13%. Both measures show that lending uses much of the deposit base. Financial-institution borrowing, money-market funding and issued securities accounted for approximately 27.1% of liabilities; including interbank deposits and subordinated funding raises that to about 31.3%. That adds refinancing exposure alongside customer deposits.
Regulatory liquidity also looks substantial where matching figures are available. Pekao reported 227% LCR and 167% NSFR at June 2026; Fibank reported 423.47% and 157.47% respectively. VakıfBank’s three-month average total LCR (lira plus foreign currency) was 149.68%, with reported NSFR of 125.71%. The averaging basis differs from a point-in-time liquidity snapshot. All three reported liquidity measures above their applicable minimums, without providing a uniform basis for ranking their buffers. Comparable June ratios for Transilvania were not established for this comparison.
The remaining question is how deposits behave under stress. VakıfBank discloses balances exceeding deposit-insurance limits equivalent to 28.7% of total deposits. That is more specific information than is available here for the original three, but it does not establish the full uninsured share or a currency-matched stress outcome. Aggregate balances also leave questions about large-account concentration and liquidity after pledges and stress haircuts. Strong ratios are reassuring, while depositor concentration and the availability of liquid assets remain important to the assessment.
Valuation: two discounts, with different risks behind them
The October prices divide the comparison into two premium-rated banks and two trading below tangible book. Fibank has the deeper discount, while VakıfBank’s lower entry multiple comes with a different mix of capital, credit and currency risk.
The multiples use approximately 1,090.3m shares for Transilvania, 262.47m for Pekao, 149.085m for Fibank and 9.916bn for VakıfBank. Transilvania’s common book excludes AT1 instruments. Fibank’s multiple retains its year-end book basis, so the table is a dated valuation snapshot rather than a comparison using identical balance-sheet dates.
Transilvania and Pekao need sustained high returns to justify their premiums. Transilvania’s operating momentum supports that case, but leaves continued growth central to the investment argument. Pekao combines a higher tangible-book multiple with a more difficult near-term margin environment.
Pekao’s dividend is a substantial part of its appeal. The PLN 19.77 per share paid in June 2026 equates to approximately 7.4% of the October price, with about 75% of 2025 bank profit allocated to dividends. Transilvania paid RON 1.4bn in ordinary dividends and acquired RON 157.8m of treasury shares during H1 2026.
Fibank offers a different proposition. At approximately 0.69x tangible book, investors are paying a discount for a bank that remains profitable, but has higher impaired exposures and weaker provision coverage. The potential upside depends on protecting book value and turning the earnings recovery into a more durable trend. Permission to repurchase up to 5.61m shares across 2026–27 adds a potential capital-return channel; actual purchases will determine its effect.
VakıfBank also trades below tangible book, at approximately 0.89x. Estimated tangible common book was TRY 36.45 per share at June 2026, against the TRY 32.30 close on 21 October. Annualising H1 parent-attributable earnings gives approximately 4.8x P/E; annualising operating earnings before provisions gives around 1.7x P/PPNR. These are run-rate calculations, not forward estimates.
The multiples are low, but their interpretation depends on the lira. Historical book growth and earnings are nominal: they do not establish a real or euro return. The question is whether returns can compensate for inflation, currency exposure and declining capital ratios.
VakıfBank’s 2025 report records 83.2m shares repurchased for TRY 2.132bn. That spending represents about 0.67% of market capitalisation at the October price, a historical comparison rather than a current buyback yield. No ordinary cash dividend was recorded for 2025. Pekao remains the clearer cash-income proposition, while VakıfBank’s case rests more heavily on earnings resilience and preservation of book value.
What matters next
For Transilvania, the question is whether fee growth and positive operating leverage can continue as credit expansion consumes capital. Its reported first-half revenue growth outpaced expense growth, and the valuation expects that positive operating leverage to persist.
For Pekao, dividend income is attractive, but the bank needs fees and business volumes to compensate for lower interest margins. Cost control and the durability of returns will determine how comfortably it earns its premium to book value.
For Fibank, the discount is clear. The investment case depends on the next stage of the credit clean-up: whether falling Stage 3 exposure is followed by improving arrears, stronger coverage and more consistent fee income.
For VakıfBank, watch whether capital stabilises as NPLs rise and whether the sharp improvement in interest income can finally translate into operating earnings. Its larger scale adds reach, while falling CET1 and rising NPLs put earnings retention and funding discipline in focus. At roughly 0.89x tangible book, the price offers a discount, but the investment case needs returns that remain attractive after currency and inflation effects.
The comparison now spans four distinct investment questions: growth at Transilvania, income at Pekao, credit recovery at Fibank, and capital and earnings resilience at VakıfBank. Size alone does little to settle the choice; the combination of asset quality, funding and the price paid matters much more.
This analysis was created with the help of the CEEWire AI agent, working from the banks’ regulatory filings and financial data. For more information about the product or to request a product demo, reach out to [email protected].