MBK.WA WACC - Weighted Average Cost of Capital
The WACC of mBank SA (MBK.WA) is 9.7%.
| Range | Selected | |
| Cost of equity | 10.6% - 15.0% | 12.8% |
| Tax rate | 19.0% - 19.0% | 19% |
| Cost of debt | 5.0% - 5.0% | 5% |
| WACC | 8.2% - 11.1% | 9.7% |
| Category | Low | High |
| Long-term bond rate | 5.5% | 6.0% |
| Equity market risk premium | 6.3% | 7.3% |
| Adjusted beta | 0.8 | 1.15 |
| Additional risk adjustments | 0.0% | 0.5% |
| Cost of equity | 10.6% | 15.0% |
| Tax rate | 19.0% | 19.0% |
| Debt/Equity ratio | 0.56 | 0.56 |
| Cost of debt | 5.0% | 5.0% |
| After-tax WACC | 8.2% | 11.1% |
| Selected WACC | 9.7% | |
| Debt/Equity | Unlevered | |||
| Peers | Company Name | ratio | Beta | beta |
| MBK.WA | mBank SA | 0.56 | 1.41 | 0.97 |
| ALR.WA | Alior Bank SA | 0.19 | 1.41 | 1.22 |
| BEKN.SW | Berner Kantonalbank AG | 4.5 | 0.13 | 0.03 |
| BMPS.MI | Banca Monte dei Paschi di Siena SpA | 1 | 1.46 | 0.81 |
| BPE.MI | Bper Banca SpA | 2.3 | 1.37 | 0.48 |
| ETE.AT | National Bank of Greece SA | 0.42 | 1.63 | 1.22 |
| JYSK.CO | Jyske Bank A/S | 10.74 | 0.35 | 0.04 |
| NOFI.OL | Norwegian Finans Holding ASA | 0.35 | 1.76 | 1.37 |
| TCS.L | TCS Group Holding PLC | 0.17 | -0.42 | -0.37 |
| UNI.MC | Unicaja Banco SA | 0.79 | 1.25 | 0.76 |
| Low | High | |
| Unlevered beta | 0.65 | 0.87 |
| Relevered beta | 0.7 | 1.22 |
| Adjusted relevered beta | 0.8 | 1.15 |
MBK.WA's CAPM model and how its cost of Equity is calculated
The Cost of Equity reflects the return a company needs to deliver to shareholders to justify the risk of investing in its shares. It’s computed using the Capital Asset Pricing Model (CAPM), which blends the risk-free rate, the stock’s beta, and the market risk premium.
This method evaluates the stock’s risk compared to a safe investment and the market’s overall volatility.
Here’s how we figure out the cost of equity for MBK.WA:
cost_of_equity (12.80%) = risk_free_rate (5.75%) + equity_risk_premium (6.80%) * adjusted_beta (0.8) + risk_adjustments (0.25%)
We include the risk adjustments, which range from 0% to 1%, to keep our WACC conservatives, especially for companies traded in developing markets.