BAWAG Group (BG) Q3 2024 earnings summary

Executive summary

• Q3 2024 net profit was €178 million, EPS €2.25, and ROTCE 24.0%; YTD net profit reached €520 million, up 3% year-over-year, with ROTCE at 23.9%.

• ECB approved the Knab acquisition in the Netherlands in October 2024, with integration plans underway and expected positive impact on results for the last two months of the year.

• Tangible book value per share rose 16% year-over-year and 3% quarter-over-quarter to €38.48.

• Two strategic acquisitions (Knab and Barclays Consumer Bank Europe) will increase the balance sheet by 35% and retail/SME business by over 70%.

• Core revenues declined by 1% year-over-year, while operational expenses increased by 4% due to inflation.

Financial highlights

• Pre-provision profit for Q3 was €265 million, down 1% year-over-year; cost-income ratio at 32.3%.

• Net interest income for Q3 was €305.3 million, down 3% year-over-year; net commission income up 8% to €82.6 million.

• Risk costs for Q3 were €25 million (25bps risk cost ratio), with a management overlay for ECL at €70 million.

• CET1 ratio at quarter-end was 17.2%, up 70bps from prior quarter, after €286 million dividend accrual.

• Cash position increased to €15.6 billion, representing 28% of the balance sheet, with LCR at 260%.

Outlook and guidance

• Full-year 2024 profit before tax target raised to over €950 million, reflecting Knab's contribution.

• Targeting full-year ROTCE above 20% and cost-income ratio under 34%.

• Year-end pro forma CET1 ratio expected to be above 14% after acquisitions and Basel IV impacts.

• CET1 ratio target increased to 12.5% to support business growth and integration.

• Investor Day scheduled for March 4, 2025, to provide further details on acquisitions and capital plans.