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 reached EUR 25.3 million, down 11.5% year-over-year, mainly due to lower interest rates and absence of positive one-offs seen in 2024.

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

• Fully digital lending launched in Croatia, Slovenia, and Romania, with Romania entry marking a strategic expansion.

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

Financial highlights

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

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

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

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

• CET1 capital ratio at 21.7% under preliminary Basel IV, excluding 2025 interim profit.

Outlook and guidance

• 2025 outlook unchanged: loan book growth >7% CAGR 2024-2026, NIM >3.6%, OPEX <EUR 196 million, total capital ratio >18.35%.

• Dividend payout target remains ~50% of net profit, subject to ECB and AGM decisions; 2024 dividend cancelled per ECB recommendation.

• 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 in all operating countries above eurozone average.