Banco BBVA Argentina (BBAR) Q4 2024 earnings summary

Executive summary

• Fiscal and monetary consolidation, along with exchange rate stability, led to inflation moderation in Argentina during 2024, with economic recovery expected in 2025 and country risk dropping significantly.

• Net income for 4Q24 was AR$64.7bn, down 39.6% QoQ and 38.9% YoY; full-year 2024 net income was AR$357.7bn, nearly flat YoY.

• Digital transformation advanced, with 88% of new customers acquired through digital channels and retail digital sales reaching 91%-93% of units in Q4 2024.

• Macroeconomic backdrop included 118% annual inflation and a 121.7% YoY FX depreciation.

Financial highlights

• Q4 2024 inflation-adjusted net income was ARS 64.7 billion, down 39.6% quarter-over-quarter; quarterly ROE was 9.5% and ROA 1.7%.

• FY 2024 net income was ARS 357.7 billion, 0.4% lower year-over-year; annualized ROE was 12.5% and ROA 2.5%.

• Operating income fell 25.8% in real terms year-over-year, mainly due to lower net interest income and reduced income from foreign exchange and gold gains.

• Net interest income for 2024 was ARS 2.93 trillion, down 17.3% year-over-year; 4Q24 net interest income was ARS 482.5 billion, down 3% QoQ and 55.3% YoY.

• Total operating expenses in 2024 were ARS 1.7 trillion, down 3.9% in real terms; efficiency ratio rose to 61.8% in 2024 and 68.6% in Q4 2024.

Outlook and guidance

• Expecting private loan growth of 60%-65% in real terms for 2025, outpacing the system's 40%-45% growth.

• Inflation forecast for 2025 is 30%, with GDP growth of 5.5%, monetary policy rate ending at 24%, and official FX rate at ARS 1,300.

• Profitability (ROE) expected in the 12%-13% range for 2025, with mid-teens sustainable in the medium term.

• Forward-looking statements highlight risks from macroeconomic volatility, inflation, interest rates, regulatory changes, and FX fluctuations.