Cembra Money Bank (CMBN) H2 2024 earnings summary

Executive summary

• Net income rose 8% to CHF 170.4 million in 2024, with net revenues up 7% to CHF 550.5 million, driven by improved net interest margin, digital transformation, and robust payments performance.

• Cost-to-income ratio improved to 48.1% (down from 50.9%), reflecting efficiency gains from transformation initiatives.

• Dividend proposed at CHF 4.25 per share, up 6%, reflecting confidence in sustainable earnings and a strong capital position.

• Payments segment net revenues grew 9%, lending up 5%, with strong card and BNPL fee growth.

• Strategic initiatives included digitalisation, new IT platform for leasing, and expanded product offerings.

Financial highlights

• Net interest income rose 10% to CHF 380.5 million, with net interest margin rebounding to 5.6% (from 5.2%).

• Operating expenses increased 1% to CHF 264.5 million, including CHF 5 million in one-off restructuring costs.

• Loss provisions at CHF 74.2 million, with a loss rate of 1.1%, in line with long-term trends.

• ROE stood at 13.4%, and the Tier 1 capital ratio was 17.9%.

• Net financing receivables slightly decreased by 1% to CHF 6.6 billion, reflecting selective underwriting.

Outlook and guidance

• Net interest margin expected to stabilize at 5.6% in 2025, with net revenues projected to grow at least in line with Swiss GDP.

• Cost-to-income ratio targeted at or below 45% in 2025, with a path to below 39% by 2026.

• ROE guidance of 14%-15% for 2025, with continued solid loss performance around 1%.

• Dividend per share expected to continue increasing, based on sustainable earnings growth.

• Buy now, pay later business expected to contribute CHF 10-20 million net income by 2026.