Raiffeisen Bank International (RBI) H2 2023 earnings summary

Executive summary

• FY profit after tax was EUR 2,578 mn; consolidated profit was EUR 2,386 mn, down 34%, while adjusted profit excluding Russia, Belarus and Bulgaria was EUR 997 mn, up 1% YoY.

• Core revenues excluding Russia and Belarus rose 12% to EUR 6,224 mn, while reported Group operating income declined 6.6% to EUR 9,065 mn.

• Asset quality remained strong despite higher Q4 Stage 3 provisions; year-end NPE ratio was 1.9% and coverage was 51.7%.

Financial highlights

• FY net interest income was EUR 5,683 mn, up 12.5% YoY; net fee and commission income was EUR 3,042 mn, down 21.6%.

• Excluding Russia and Belarus, core Group net interest income rose 26% to EUR 4,282 mn; net fee and commission income was EUR 1,724 mn, down 1%.

• General administrative expenses increased 10% to EUR 3,908 mn; cost/income ratio rose 6.5 pp to 43.1%.

• Operating result was EUR 5,158 mn; impairment losses on financial assets were EUR 393 mn and profit after tax was EUR 2,578 mn.

• EPS was EUR 6.93 versus EUR 10.76 in FY 2022; book value per share was EUR 51.71 versus EUR 48.72 a year earlier.

Outlook and guidance

• FY 2024 Group CET1 ratio is expected at ~17.8%, including ~200 bps retained earnings net of expected dividend accrual and ~160 bps RWA increase.

• 2024 Group guidance: net interest income ~EUR 5.1 bn, fee income ~EUR 2.7 bn, opex ~EUR 4.0 bn, CIR ~47%, risk costs ~60 bps, RoE ~12% and loan growth ~5%.

• Excluding Russia and Belarus, 2024 guidance includes fee income ~EUR 1.8 bn, risk costs ~50 bps, RoE ~11% and loan growth ~6%.

• In the P/B zero Russia deconsolidation scenario, CET1 is expected at ~14.6% before the STRABAG dividend-in-kind benefit; medium-term RoE and payout targets are suspended.

• Dividend decisions will be based on capital excluding Russia; capital generated in Russia is not invested in RWAs elsewhere in the Group.