caixabank leaves behind the effects of the merger with Bankia and provides 214 million in provisions for the war in Ukraine. The Catalan entity has announced a net profit in the first quarter of 707 million euros, which represents a drop of 85% compared to the result of 4,786 million obtained in the same period of 2021, when the figures were distorted by extraordinary items associated with the absorption of Bankia. Without taking these effects into account, the bank’s quarterly profit grows 22% and is also above the 588 million expected by Bloomberg analysts.
And it is that, the result of last year included a net positive contribution for accounting purposes of 4,300 million for the negative goodwill after the merger. In comparable terms, the result for the first quarter of 2022 grows by 21.9% in relation to the comparable pro forma result of 580 million euros for the same period of 2021, explains the entity. In the first bars of the session on the Stock Exchange, the shares fell around 1% but later turned around to rise close to 3%.
In addition, CaixaBank has provided a “collective fund” amounting to 214 million to reflect the estimated impact derived from the “change of macroeconomic scenario due to the conflict in Ukraine”. The fund set up by to mitigate the financial effects of Covid stood at 1,196 million euros at the end of the quarter, compared to 1,395 million at the end of 2021. The entity detects “greater visibility” on the situation of customers who had measures of support during the pandemic, “before the next expiration of the same”. Along these lines, provisions for bad debts fell by 23.2% and other provisions for provisions fell by 37.7%.
With regard to commercial activity, the interest margin it amounted to 1,550 million euros, with a fall of 5.4%, which is explained by a decrease in credit income due to a decrease in the type and the lower contribution of the fixed-income portfolio. The gross margin amounts to 2,775 million, practically unchanged compared to the first quarter of last year.
The net commissions amount to 969 million, 2.9% more, although the entity points out that recurring bank commissions decreased by 3.3%, due to the unification of customer loyalty programs. In this sense, this indicator was favored by insurance sales commissions (+2.3%) and those associated with the management of long-term savings products (+10.3%). CaixaBank points out that the growth comes from “the entity’s solid business in loans and long-term savings products.”
The entity’s CEO, Gonzalo Gortazar, highlighted the result in a complex environment, since in the markets in which Spain and Portugal mainly operate, the rates have remained negative. However, he pointed out that CaixaBank’s sensitivity to a rise of 100 basis points would be between 20% and 25% over 12 months.
new credit production
The activity indicators“they remain stable in the quarter.” Gross customer credit reaches 353,404 million euros (compared to 352,951 million in the 2021 quarter) and customer funds that stand at 619,892 million euros “despite the volatility of the markets,” says the entity. The new production of mortgages and consumer credit in Spain improved by 14% and 18% year-on-year, respectively.
The CEO pointed out that after having completed “practically 90% of the planned integration of offices and departures of employees”, the group can focus “increasingly on business growth. Gortázar has announced that the entity will present its plan strategy on May 17 and that “will define the direction and speed of the entity for the next three years”.
Refering to solvency, the Common Equity Tier 1 (CET1) ratio stands at 13.4%. The coverage rate rises to 65% from 63%, after the fall of 272 million euros in doubtful assets. The NPL ratio falls 0.1 percentage points to 3.5%.
On April 20, CaixaBank paid its shareholders 0.1463 euros per share as an ordinary dividend charged to the profits for financial year 202. This dividend distribution amounts to 1,179 million euros, an amount equivalent to 50% of net profit 2021 consolidated statement, adjusted for extraordinary impacts related to the merger.
The CEO of CaixaBank, Gonzalo Gortázar, highlighted the bank’s service to older groups and reaffirmed its commitment to maintain offices in the municipalities where the bank is the only one with a branch. In this sense, he highlighted that CaixaBank is present in 2,200 municipalities in Spain, and that the entity will invest 50 million euros this year to reinforce attention to vulnerable groups. Likewise, he announced that the bank plans to extend its ofimóvil service to reach rural populations that do not have a bank office. “We fulfill a very important social function. We cover 490 municipalities through ofimóviles and the idea of growing to reach points in Spain that do not have banking services,” he explained.