Banco BPM (BAMI) H2 2025 earnings summary

Executive summary

• Net profit for 2025 reached €2.08 billion, surpassing guidance by €130 million and nearing the 2027 strategic plan target, with a 50/50 split between interest income and commissions.

• CET1 ratio pro-forma at 13.76%, well above the 13% plan minimum and regulatory requirements, reflecting robust capital generation.

• Dividend per share set at €1.00, with a payout ratio of 80% and total shareholder remuneration for 2024/25 at €3 billion, achieving 50% of the strategic plan's cumulative target.

• Non-interest income rose to 51% of total revenues, indicating a more diversified and resilient business model.

• Strong new lending generation, up 33% year-over-year, with customer financial assets at €396 billion.

Financial highlights

• Total revenues for 2025 were €5.96 billion, up 4.4% year-over-year, with non-NII revenues now representing 51% of total.

• Net interest income declined by 9.1% year-over-year to €3.13 billion, offset by a 21.4% increase in net fees and commissions to €2.5 billion.

• Operating costs decreased 1.7% year-over-year on a like-for-like basis, with cost/income ratio improved to 46%.

• Cost of risk improved to 40 bps, with total provisions down 26% year-over-year.

• Asset quality at record levels, with gross NPE ratio at 2.2% and net NPE at 1.2%.

Outlook and guidance

• Confident in delivering €1.00 cash dividend per share in FY 2026, maintaining a lead on the >€6bn 2024-27 cumulative distribution target.

• 2026/27 net income targets above €2.1 billion, with ROTE above 21% and ROE above 16%, and non-NII revenues expected to remain above 50% of total.

• Revenue and profit targets for 2026/27 considered achievable, though headwinds from higher taxes and systemic charges are expected.