Credicorp (BAP) Q1 2025 earnings summary

Executive summary

• ROE reached 20.3% (18.4% excluding extraordinary gains), driven by strong operating performance, risk management, resilient margins, and diversified income streams.

• Peru's economy rebounded with 3.9% GDP growth in Q1 2025, supporting business momentum and portfolio growth.

• Innovation portfolio contributed 5.4% of risk-adjusted revenues, advancing financial inclusion and value creation.

• Loan growth resumed, especially in wholesale banking and individuals, with asset quality improving due to tightened origination standards and risk management.

• Sustainability initiatives advanced with a new 2025-2030 framework, focusing on inclusive finance and green loans.

Financial highlights

• Net interest income rose 4.3% YoY, supported by lower interest expenses and a 59% share of low-cost deposits.

• Fee income increased 16% YoY, while insurance underwriting results rose 17.9% YoY.

• Efficiency ratio stood at 45.7%, as operating expenses grew 15.6% YoY due to business growth and innovation investments.

• Extraordinary gain of S/236 million from the Banmedica JV acquisition; non-cash equity adjustment of S/257 million from Bolivian asset devaluation.

• Net income for 1Q25 reached S/1,778 million, up 57.8% QoQ and 17.6% YoY.

Outlook and guidance

• 2025 guidance maintained: loan portfolio growth around 3.5%, NIM between 6.2%-6.5%, cost of risk 2.0%-2.4%, efficiency ratio 45%-47%, and ROE around 17.5%.

• Loan book growth forecasted at 3.45% (average daily balances) or 6% (quarter-end), with acceleration expected in retail and microfinance.

• Innovation portfolio on track to reach 10% of risk-adjusted revenues by 2026.

• Peru GDP expected to grow around 3% in 2025, assuming global recession risks remain contained.