Spanish banking begins this Thursday with the first round of results for the year 2024. Bankinter, as usual, kicks things off and between January and March it has earned 200.8 million euros, 8.7% more, according to communicated to the National Securities Market Commission. These are the first accounts of the group’s new CEO, Gloria Ortiz, in which the entity has achieved the best first quarter in its history thanks to the improvement in all business lines and markets. Investors have received these numbers with a rise in the price of more than 2% at mid-morning on the stock market.
In this way, Bankinter marks what is probably the trend in the sector: profits continue to increase due to an improvement in the volumes of the credit portfolio, although with more timid progress than last year. It is worth remembering that last year Bankinter obtained profits of 844.8 million, 50.8% more.
This difference is explained by the boost provided to Spanish banks by the abrupt increase in interest rates set by the European Central Bank (ECB) since mid-2022. For this year there were more doubts, but the entities are confident of consolidating the level of record reached and even surpass those historical levels. Of course, with a small difference.
On the interest margin side, the bank achieved 577.7 million euros, 10.6% more than in the same period last year. And in net commissions the advance was 8.5%, up to 165.8 million. These two figures are used to calculate the payment of the extraordinary tax to the sector, for which Bankinter will pay in 2024 (based on its figures from last year) between 90 and 100 million euros. A rate, furthermore, that the Government has announced that it will make permanent, despite having the rejection of the sector from its origin.
“The increase in volumes, thanks to the consistency of its commercial strategy, the good management of spreads and the promotion of the highest value customer segments, has generated growth in all margins and has consolidated the bank in positions of sector leadership. both in efficiency and profitability. And all this while preserving the good risk profile, with controlled delinquency,” the group explains in a statement.
On the expense side, the group’s operating costs have increased by 5.8%, to 232.2 million, due to inflation pressure. Thus, they have grown significantly, but somewhat below income, which allows them to widen the difference between the two. The gross margin amounted to 658.7 million, 7% more than a year ago.
This positively impacts several metrics. For example, the efficiency ratio improved to 35.26% (better the lower), 0.39 percentage points less. And the bank’s profitability on equity (ROE) advanced to 17.36%, while the return on tangible capital (ROTE) did the same to 18.42%.
On the other hand, delinquency remains contained at historically low levels and the defaults that were expected after the rate increase have not arrived. In the case of Bankinter, it closed March with a default of 2.2%, just 5 basis points above last year. Proof of this good news is that the beneficiaries of the Code of Good Practices, both the permanent one since 2012 and the temporary one approved at the end of 2022, do not reach 8,000 families, according to data published this week by the Bank of Spain.
This figure contrasts with the Government’s initial forecast, which expected that this safety net could reach up to one million families in debt, vulnerable or at risk of being so, although even then the supervisor reduced the beneficiary effects to around 200,000 households. Given what we have seen, it seems that both of them went too far.
In terms of capital, Bankinter’s solvency is well above what the ECB requires and ended the first quarter with a CET1 capital ratio fully loadedthe highest quality, 12.46%, 36 basis points above what it had in March 2023.
Growth in Portugal
Bankinter has also managed to grow in the Portuguese market, with an increase in the loan portfolio of 20%, reaching 10,000 million euros in this territory. This has allowed him to earn 47 million euros in the country, 9% more.
Back in business in Spain, the digital brand EVO Banco continues to improve its figures and contributed 20.2 million euros to the gross margin, almost 15% more than in March 2023. On the other hand, regarding Bankinter’s payroll accounts , the entity’s star product for attracting customers, closed March with 547,000 open accounts, 5% above what it had 12 months ago.
Where the business shows a deterioration is in new mortgage production, which in the first quarter was 1,300 million euros, 20% lower than the same period last year. This drop also occurred only in the Spanish business, although with less intensity (-9%). Despite this, the group’s residential mortgage portfolio grew by 2.5% as the pace of early repayments slowed. That is to say, although new production has decreased, it has been enough to compensate for the outflows from the mortgage portfolio.
More active
The group’s assets stood at 112,938.3 million euros on March 31, 6.6% more than in the same period in 2023. The customer loan portfolio reached 77,041 million euros, 5.4% more than a year ago. If we look only at the data from Spain, the credit portfolio has grown by 2.2%, an increase less than that of the group but which occurs in a few months in which the sector has seen a setback in the country due to a poor real estate market. still somewhat weak.
As for retail customer resources, these reach 78,750 million euros, which means a growth of 6%, “with strong growth in time deposits and a drop, although smaller, in the account balance,” the report states. bank note. Furthermore, resources managed off-balance sheet have grown by 18.2% to 47,125.3 million euros.