Credito Emiliano (CE) Q3 2024 earnings summary

Executive summary

• Consolidated net profit reached €485.9 million, up 10.7% year-over-year for 9M24, driven by core revenue growth, effective cost management, and after €33 million in contributions to distressed banks and over €4 million in insurance guarantee provisions.

• Revenue growth of 7.2% YoY was supported by both net interest income (+7.5%) and non-interest margin (+6.8%).

• Asset quality remained robust, with a gross NPL ratio of 1.9%–1.91% and cost of risk at 6 bps, among the lowest in the sector.

• CET1 ratio at 17.2% (banking group) and 15.8% (holding), providing a significant buffer over regulatory requirements.

• Over 134,000 new clients were acquired, with accelerated customer growth strategies across business units.

Financial highlights

• Operating income was €1,509.6 million (+7.2% YoY); net interest income €847.6 million (+7.5% YoY); non-interest margin €662.0 million (+6.8% YoY).

• Operating costs increased 7.4% YoY, mainly due to IT investments, new labor agreements, and inflationary pressures.

• Gross operating profit rose 7.0% YoY to €863.5 million; net operating profit was €783.4 million (+7.5% YoY).

• Profit before taxes was €720.4 million (+11.3% YoY); taxes for the period were €234.5 million (+12.7% YoY).

• Cost/income ratio was 42.8% (42.7% in 2023); annualized ROE 17.1%–17.4%, ROTE 19.5%.

Outlook and guidance

• Financial margin is expected to stabilize as interest rates decline, but profitability should remain resilient, supported by strong fee income and low cost of risk.

• The group will continue investing in digital transformation, climate/environmental risk management, and product innovation.

• The business model is expected to mitigate negative impacts from potential market downturns and maintain an adequate risk profile.