Artea bankas (ROE1L) Q4 2025 earnings summary

Executive summary

• Net profit for 2025 was €60.7 million, with adjusted net profit at €73 million, reflecting strong underlying performance despite one-off costs from core banking upgrades and rebranding.

• Loan portfolio grew 8% year-over-year to €3.71 billion, and deposits increased 17% to €3.96–4.0 billion, intentionally strengthening the funding base and reducing the loan-to-deposit ratio to 93.8–95%.

• Maintained robust capital position with CET1 ratio at 16.6% and total capital ratio at 21.2%, well above regulatory requirements.

• Strategic initiatives included a completed rebranding, ongoing Core Banking modernization, and leadership in energy efficiency financing, including a €625 million EIB fund mandate.

• Lithuania remains one of the fastest-growing EU economies, supporting sector growth and consumer optimism.

Financial highlights

• Net fee and commission income grew 6% year-over-year to €30.9–31.0 million, driven by asset management and renovation businesses.

• Net interest income declined 14% year-over-year to €138.3 million due to a low base rate environment.

• Operating expenses increased due to one-offs from Core Banking and rebranding, with cost/income ratio rising to 58.8% and adjusted cost-to-income at 56.5%.

• Return on equity was 10.4%, or 12.4% on an adjusted basis.

• Total assets grew 23% year-over-year to over €6 billion.

Outlook and guidance

• 2026 guidance: loan book growth of 11%, deposit growth of 5%, total revenue up 10%, and net profit of €61 million (adjusted €73 million).

• Net interest margin projected to remain at 2.5–2.6% in the near term, with potential to rise to 3% as funding costs improve.

• Cost-to-income ratio targeted to fall below 45% after the investment phase ends in 2026–2027.

• Long-term return on equity goal remains above 17%, with a minimum 50% payout commitment and 2025 distribution proposal at a record 70% (50% dividends, up to 20% buybacks).

• Strategic ambition to become Lithuania’s national champion and best bank by 2029, focusing on customer satisfaction and 20% investor return.