Komercní banka (KOMB) Q1 2025 earnings summary

Executive summary

• Achieved record Q1 net income of CZK 4.2 billion, up 49.3% year-over-year, marking the best Q1 in group history, with EPS at CZK 22.17.

• Client base grew by 60,000 to 1.7 million for KB Bank, with total group clients at 2,177,000 and strong migration to new technology platforms.

• Lending to customers increased 2.9% year-over-year, driven by a 54.5% surge in housing loans.

• Deposits declined 1.0% year-over-year, but current account volumes rose nearly 5%.

• Maintained a 100% dividend payout policy, with CZK 91.30–93.10 per share declared for 2024 profits.

Financial highlights

• Net banking income rose 3.5% year-over-year to CZK 9.1 billion; net interest income up 2.0% and fee income up 11.2–11.3%.

• Operating expenses declined by 4.4%, mainly due to cost control and lower regulatory charges.

• Cost of risk saw a net release of CZK 496 million, mainly from non-retail exposures.

• Return on equity improved to 13.0% (13.7% IFRIC 21 linearised); cost/income ratio at 50.3% (47.2% adjusted).

• Earnings per share increased 49.3% year-over-year to CZK 88.7.

Outlook and guidance

• Lending and deposit growth for 2025 guided at mid-single-digit rates, with revenue growth revised down to mid-single digit.

• Cost guidance improved to a low- to mid-single-digit decline, reflecting ongoing optimization and staff reduction plans.

• Cost of risk for 2025 guided at 0–10 basis points, closer to zero, due to planned reserve reversals and stable default rates.

• Fee income guidance revised to stable due to lower expected sales of equity mutual funds.

• Management aims to further grow customer base, accelerate digital migration, and maintain a 100% dividend payout policy.