Banca Sistema (BST) H1 2025 earnings summary

Executive summary

• Net profit attributable to owners reached €14.6 million in H1 2025, up 145% year-on-year, driven by strong income growth and improved profitability across core business lines.

• Revenues increased 27% year-on-year, with the Factoring Division as the main contributor, supported by Superbonus trading.

• Capital ratios improved significantly, with CET1 at 13.8% and total capital ratio at 16.6%, up 140 and 170 basis points in Q2, supported by SRT completion and better asset quality.

• Retail funding represents 72% of total funding, with cost of funding down to 3.07%, a 50 basis point decrease year-to-date.

• A public offer for 100% of shares has been announced by Banca CF+, with the board's opinion pending.

Financial highlights

• Total income rose 27% year-on-year to €69.8 million; net profit reached €14.6 million (+145% y/y); pre-tax profit was €24.1 million (+128% y/y).

• Net interest income increased 41% year-on-year; adjusted NII (including Superbonus trading) up 43% year-on-year.

• Cost increase was limited to 2% due to DGS cancellation and controlled operating expenses.

• Cost of risk increased to 35 basis points, stable year-on-year but up from 24bps in 1H24.

• Total assets decreased 6.7% quarter-on-quarter to €4.39 billion due to lower customer loans and financial portfolio.

Outlook and guidance

• Turnover is expected to remain stable over the three-year plan, with a focus on profitable CQ loans and third-party product distribution.

• Funding cost is projected to average around 3% for 2025, continuing the downward trend.

• Securitization in the entertainment sector and capital reserves will boost activity and RORAC with low capital consumption.

• Further reduction in past due loans is targeted, primarily through collections and agreements with public administration.

• A non-recurring charge of €9.3 million is anticipated if a change of control occurs due to a public tender offer.