Banca IFIS (IF) H2 2024 earnings summary

Executive summary

• Net income for 2024 ranged from €152 million to €162 million, with three-year cumulative profits of €463 million, exceeding Business Plan targets.

• The three-year business plan (2022-2024) was successfully completed, with net profits above target each year and a strong capital and liquidity position maintained.

• Digital transformation initiatives were fully implemented, enhancing customer service and operational efficiency.

• Strong focus on sustainability, with improved ESG ratings and impactful social initiatives.

• Strategic actions included extending government bond portfolio duration and increasing fixed-rate business, especially in leasing.

Financial highlights

• Net banking income for 2024 was €699 million, stable year-over-year; Q4 2024 net revenues were €167 million, down 13% YoY.

• CET1 ratio at year-end 2024 was 16.1%, up from 14.87% in 2023 and 100 basis points above plan target.

• Total dividends distributed for 2024 were €111.5 million, about 40% above Business Plan targets, with a payout ratio near 70%.

• Operating costs rose in 2024, mainly due to IT, digitalization, ESG projects, and NPL recovery expenses.

• Proprietary portfolio contributed €109.1 million in revenues YTD24, up 16% YoY.

Outlook and guidance

• 2025 net income is expected to be broadly in line with 2024, assuming no significant macroeconomic or geopolitical shocks.

• Focus remains on profitability, maintaining spreads, and selective NPL acquisitions.

• RWAs projected to grow 2% year-over-year, outpacing market growth.

• Sensitivity to rate decreases has been significantly reduced through portfolio adjustments.

• Capital levels support further short-term growth opportunities and potential acquisitions.