Artea bankas (ROE1L) Q1 2025 earnings summary

Executive summary

• Q1 2025 net profit was EUR 17.7 million (down 21% YoY); adjusted net profit reached EUR 19.4–20 million, with ROE at 12.4% reported and 13.6% adjusted, in line with budget expectations.

• Loan portfolio grew 2% sequentially and 15% year-over-year, with strong asset quality and the lowest NPL ratio in five years at 2%.

• Net fee and commission income rose 17% year-over-year, now accounting for 16% of total revenues.

• Dividend of EUR 0.061 per share paid, the highest in history; buyback program ongoing and expected to resume pending ECB approval.

• Rebranding to Artea Bankas effective May 5, 2025, with major investments in technology and marketing; ticker changes to ROE1L.

Financial highlights

• Net interest income declined 13% YoY to EUR 34.4 million due to changing rate environment but is expected to stabilize in Q2.

• Operating profit before impairment and tax was EUR 24.5 million, down 18% YoY; cost-to-income ratio rose to 52.6%.

• Operating expenses increased, mainly from higher salaries (EUR 2.6 million), inflation, and one-off transformation costs (EUR 2.2 million in Q1, up to EUR 15 million planned for the year).

• Cost of risk stood at 0.2–0.22% in Q1, with guidance for 2025 at 0.2–0.3%.

• CET1 ratio at 18.0%; total assets EUR 5.3bn, up 7% YoY.

Outlook and guidance

• Full-year guidance reiterated; management remains committed to delivering on previously communicated targets.

• Loan origination expected to catch up with budgeted growth for 2025; loan book expected to reach EUR 4.1bn in 2025.

• Net interest margin expected to stabilize around 3% for the year.

• Net profit guidance for 2025 at EUR 65m, with minimum 50% dividend payout.

• Long-term ROE target above 17%; adjusted ROE expected to reach 13.7% in 2025.