Banorte's management expects ROE to increase to 17-18% by 2013, but interest rates will probably need to rise for the Mexican bank to reach 20% ROE, Deutsche Bank (NYSE: DB) said in a report.
The report also said that Banorte sees growth possibilities in the consumer sector, where it currently has a 10% market share.
Banorte is reportedly content with its government loan exposure of 20% after recent restructuring, as no single government represents more than 3% of total loans.
Last week, Deutsche Bank reduced Banorte's 2012 earnings estimate by 9%, after the bank's shares fell 28% year-to-date. DB maintains ROE estimates of 16% for 2013.
Banorte ROE for 3Q11 was at 12.6%, down from 15.8% from the same quarter of 2010.