BAWAG Group (BG) Q4 2025 earnings summary

Executive summary

• Achieved record net profit of €860 million for 2025, up 13% year-over-year, with EPS of €10.87 and ROTCE of 26.9%, surpassing all 2025 targets and initiating new multi-year goals.

• Fourth quarter net profit was €230 million, ROTCE 28%, and all 2025 targets were exceeded.

• Integration of recent acquisitions, including Barclays Consumer Bank Europe and Knab, progressed ahead of plan, expanding into a pan-European and U.S. banking group with a digital-first approach.

• Distributed €607 million to shareholders via dividends and share buybacks, reducing shares outstanding by 23% since IPO.

• Achieved 3% organic customer loan growth, or 12% including acquisitions.

Financial highlights

• Core revenues rose 36% year-over-year to €2.2 billion, with net interest income up 40% to €1.8 billion and net commission income up 20% to €371 million.

• Pre-provision profits reached €1.42 billion, up 31% from prior year; cost income ratio at 36.1%.

• Net interest margin stood at 3.29% for the year, with a Q4 value of 3.32%.

• Operating expenses down 3% in Q4, cost income ratio improved to 33.8% in Q4 2025.

• Risk cost ratio for FY 2025 was 0.41%, with a Q4 spike to 0.45% due to a single name default; NPL ratio stable at 0.8%.

Outlook and guidance

• Net profit targets: over €960 million in 2026, over €1.1 billion in 2027, and over €1.2 billion in 2028, with 12% CAGR from 2025-2028.

• Through-the-cycle ROTCE target above 20%, cost income ratio under 33%, CET1 target at 12.5%.

• Expecting 3%-4% annual loan growth, 6% NII/core revenue growth in 2026, and risk cost ratio of 45 bps.

• Over €1.5 billion in excess capital projected by 2028, available for M&A, distributions, or growth.

• Operational expenses to decrease by over 5% in 2026.