BPER Banca (BPE) Q1 2025 earnings summary

Executive summary

• Achieved record adjusted quarterly net profit of €443 million in Q1 2025, up 43.2% year-on-year, driven by strong commission growth, improved cost efficiency, and robust asset quality, with CET1 at 15.8%.

• Strategic plan "B: Dynamic | Full Value 2027" is fully on track, with 100% of initiatives launched, significant progress in digitalization and ESG lending, and a major public exchange offer for Banca Popolare di Sondrio (BPSO) underway.

• Asset quality remains strong, with cost of risk at 31bps, net NPE ratio at 1.2%, and NPE coverage ratio stable at 54.2%.

• Capital ratios strengthened, with CET1 at 15.8% and organic capital generation of €540 million in Q1 2025.

• S&P upgraded BPER's long-term rating to BBB/A-2, Fitch revised outlook to positive, and shareholders approved a €0.60 per share dividend and capital increase to support the Sondrio acquisition.

Financial highlights

• Core revenues reached €1.4 billion, up 0.8% year-on-year; net commission income grew 8.5% to €541.1 million, with AUM fees up 18.7% and bancassurance fees up 26.9%.

• Net interest income declined 3.8% year-on-year to €811.9 million, mainly due to lower rates.

• Operating costs decreased 3.2% year-on-year to €667.4 million; cost/income ratio improved to 46.7%.

• Loan origination totaled €4.4 billion (+22.3% year-on-year), with 60% to entrepreneurs and corporates.

• LCR at 166% and NSFR at 134.4% at March 2025; loan-to-deposit ratio stable at 76.3%.

Outlook and guidance

• FY25 guidance: total revenues expected at ~€5.4 billion (down mid-single digit vs FY24), net commission income up mid-single digit, cost/income ratio ~51%, cost of risk below 40bps, CET1 ratio above 15%.

• 75% average dividend payout planned for 2025–2027, with potential for higher payout if capital allows.

• Combined BPER-BPSO group targets >€7 billion revenues and >€2 billion net income by 2027.

• Macroeconomic outlook remains cautious, with global GDP growth moderating and Italy's GDP expected to grow by 0.6% in 2025.