Regional S.A.B (RA) Q4 2025 earnings summary

Executive summary

• Net income for 4Q25 was $1,816 million pesos, up 7% year-over-year, with ROAE at 19.1% despite a 223 bps decline year-over-year.

• Total assets increased 12% year-over-year to $277,416 million pesos, with total loans up 8% and core deposits up 13%.

• Commercial strategy focused on regional expansion, cost control, disciplined credit underwriting, and income diversification, especially non-financial revenue.

• Portfolio health remains strong, with no significant deterioration in credit quality and disciplined risk management.

• Hey Banco completed its spin-off, reporting $55 million pesos net income for the quarter and continued profitability improvement.

Financial highlights

• Financial margin for 4Q25 was $4,022 million pesos, up 7% year-over-year; adjusted financial margin also grew 7%.

• Core deposits grew 13% year-over-year to $190,547 million pesos; time deposits also up 13%.

• Non-financial income increased 10% quarter-on-quarter, with card merchant fees up 17% year-over-year and insurance fees up 25% quarter-on-quarter.

• Operating expenses rose 17% year-over-year due to technology, expansion, and inflation, raising the efficiency ratio to 42.2%.

• Net commissions and fees reached $629 million pesos, a 12% increase; insurance income was $223 million pesos (+1%).

Outlook and guidance

• Targets for 2026: total loan and deposit growth 5%-10%, NIM 6%-6.3%, efficiency ratio ~42%, net income growth 5%-10%, ROE 8%-19%, cost of risk 0.8%-1%, NPL ratio below 1.8%.

• Hey Banco guidance: loan growth 15%-20%, net income growth 65%-90%.

• Management maintains a strong capitalization ratio of 15.0% and expects continued growth in core deposits and commercial lending.

• Statements caution that future results are subject to risks including economic, political, and regulatory factors.

• No change in strategy for Hey Banco post-spin-off; focus remains on bancarized customers and cross-selling.