Addiko Bank (ADKO) Q1 2025 earnings summary

Executive summary

• Net profit for Q1 2025 was EUR 14.5 million, down 7% year-over-year from EUR 15.6 million, with a return on average tangible equity of 7.1% and EPS of EUR 0.75.

• Operating result decreased 11.5% year-over-year to EUR 25.3 million, mainly due to lower interest rates and absence of prior year one-offs.

• Consumer lending showed strong double-digit growth, while SME lending demand remained subdued.

• NPE volume stable at EUR 147 million, NPE ratio at 3.0%, and NPE coverage at 80.9%.

• No dividend paid for 2024 following ECB recommendation; dividend policy of ~50% payout remains, subject to ECB guidance.

Financial highlights

• Net interest income declined 1.8% year-over-year to EUR 58.7 million, partially offset by consumer business growth and sovereign bond investments.

• Net commission income increased 8% year-over-year to EUR 18.2 million, driven by strong sales and product enhancements.

• Cost/income ratio rose to 63%, with OPEX up 4.1% year-over-year due to wage increases.

• Loan-to-deposit ratio stable at 66.3%; customer deposits increased to EUR 5.3 billion (+5.4% YoY).

• CET1 capital ratio at 21.7% under preliminary Basel IV, with RWA growth contained at 2.6%.

Outlook and guidance

• 2025 guidance: loan growth >7% CAGR (2024-2026), NIM >3.6%, NPE ratio <3%, ROATE ~6%, OPEX <EUR 196 million, LDR <80%.

• Dividend payout target remains ~50% of net profit, subject to ECB and AGM decisions.

• Global uncertainties and regulatory changes may impact income generation and mid-term loan growth targets.

• Consumer demand expected to remain strong; SME lending demand remains a risk to growth targets.

• Macroeconomic outlook for CSEE region remains positive, with GDP growth above eurozone average.