In February, Commonwealth Bank’s stake in Swedish buy now pay later business Klarna was valued at A$2.4 billion, according to the bank’s half-year report.
This marked a drop of $300,000 within six months, a mighty tumble in value driven by the BNPL market becoming over-valued and crowded.
Now, according to Morgan Stanley, CBA’s 4 per cent stake is worth just A$400 million, marking a $2 billion loss in a six month period.
The analysts based this on Klarna’s devaluation to $US6.5 billion, from $US46 billion a year ago.
“CBA values Klarna ‘based on a methodology leveraging revenue multiples of market listed comparable companies’ and it used a multiple of 28x at 1H22,” says the Morgan Stanley note, written by equity analyst Richard Wiles.
“All else equal, an 85 per cent year on year reduction in the value of Klarna… would imply a write-down of $2bn in the value of CBA’s stake to $0.4bn.”
CBA shares are down 0.12 per cent today, to $91.34.
