Regional S.A.B (RA) Q2 2025 earnings summary

Executive summary

• Net income for 2Q25 reached $1,639 million pesos, up 2% year-over-year, with ROE/ROAE at 20.1% and total assets up 13% to $263,167 million pesos.

• Total loan portfolio grew 10% year-over-year to $183,722 million pesos, with commercial loans up 11% and personal loans up 9%.

• Core deposits increased 7% year-over-year to $174,521 million pesos; time deposits up 7%, though sequential declines noted.

• Efficiency ratio deteriorated to 40.8%, up 188 bps year-over-year.

• NPL ratio rose to 1.5%, up 21 bps year-over-year, indicating a slight increase in credit risk.

Financial highlights

• Financial margin expanded 8% year-over-year to $3,815 million pesos; non-interest income reached $1,027 million pesos, with insurance fees up 25%.

• Operating income for 2Q25 was $2,248 million pesos, up 3% year-over-year.

• Loans grew 10% year-over-year, with strong performance in Jalisco and commercial segments.

• Total expenses increased 11% year-over-year, outpacing income growth; efficiency ratio at 40.8%.

• Shareholders' equity rose 13% year-over-year to $34,275 million.

Outlook and guidance

• Loan and deposit growth guidance revised to 7%-10% due to economic uncertainty; net income growth guidance lowered to 5%-10%.

• ROE target now 19%-20%; NIM guidance maintained at 6%-6.5%.

• Cost of risk guidance increased to 0.8%-1%.

• Capitalization ratio at 14.1% as of May 2025, supporting future growth.

• Forward-looking statements highlight exposure to macroeconomic, political, and regulatory risks.