Grupo Financiero Banorte (GFNORTEO) Q2 2025 earnings summary

Executive summary

• Net income for 2Q25 increased 4% year-over-year to Ps 14.62 billion, but declined 4% sequentially, mainly due to insurance normalization, expense allocation, and FX effects; H1 net income rose 6% year-over-year to Ps 29.91 billion.

• ROE reached 23.6% in 2Q25, up 29bps year-over-year and 17bps quarter-over-quarter; Bank ROE was 30.2%, up 225bps sequentially.

• Business diversification supported profitability: bank net income up 2% year-over-year, insurance up 14%, broker dealer & mutual funds up 439%, and Afore up 8%.

• Core business performance remained strong despite a challenging macroeconomic environment, with resilient internal demand and prudent fiscal policy in Mexico.

• The group reaffirmed its 2025 guidance, citing better-than-expected expense and risk indicators, but noted FX and potential dividend distribution as variables to monitor.

Financial highlights

• Net income for H1 2025 reached Ps 29.91 billion, up 6% year-over-year, driven by strong core banking revenues.

• Net interest income from loans and deposits grew 14% year-over-year; total NII up 12% year-over-year, with a negative FX impact of Ps 887 million.

• Non-interest income rose 26% year-over-year, driven by higher trading income, but declined 26% sequentially due to insurance seasonality.

• Lending activity (excluding government) showed double-digit growth, led by consumer loans (+12%), corporate (+17%), and commercial (+11%) year-over-year.

• Consumer lending grew 12% year-over-year, with auto loans up 30% and credit cards up 18%.

Outlook and guidance

• 2025 guidance reaffirmed: loan growth 8–11%, NIM 6.1–6.4%, cost of risk 1.8–2.0%, net income Ps 59.6–62.1 billion, ROE 21.5–23.0%, bank ROE 28.0–30.0%, ROA 2.2–2.4%.

• GDP growth forecast for Mexico is 0.5% in 2025, with private consumption as the main driver.

• Anticipates Mexican Central Bank rate at 7% by year-end 2025 and MXN/USD at 19.50.

• Special dividend announcement expected in Q3, pending financial review.

• Management expects continued earnings growth, supported by diversified income streams, strong capital, and liquidity positions.