2023-10-26 12:12:15
Like the rest of the financial sector, the monetary policy of the European Central Bank (ECB) is helping Kutxabank a lot, which in the first nine months of this year has posted a profit of 385.2 million euros, which It is 54% more than last year and, above all, more than in 2022 as a whole, when it earned 330 million. We are therefore talking about a record result, supported by an interest margin (the game between loans, which are collected, and deposits, which are paid) that has gone up to 836.2 million euros, almost double that in the January-September period of last year. That, after paying taxes worth 250 million, including the extraordinary tax to the banks, which has meant a disbursement of 47 million this year.
The so-called off-balance sheet resources, especially investment funds (a segment in which Kutxabank enjoys a leading position in the Spanish market) and insurance, are also driving the entity chaired by Anton Arriola, which although it has not suffered a worsening of its default ratios (at 1.4% it is the lowest rate in Spain) it has opted for prudence and increased its provisions for possible insolvencies in its credit portfolio by almost 60% to 275 million.
In a communication sent to the National Securities Market Commission (CNMV), Kutxabank does not hide that high interest rates (the medicine with which the ECB tries, with relative success for now, to contain inflation) are fuel for your accounts. Thus, he explains that “the banking business has grown by 44% due to the evolution of the interest margin and the contribution of the insurance business, which has contributed 125 million to the income statement.” In the letter, as is logical, the entity also takes the opportunity to remember that it has once again been the most solvent bank in the Spanish system in the stress tests of the European banking authority.
And he adds that this rate pressure is indeed cooling the demand for credit and investment in the sector: “The rising cost of financing is having a negative impact on the volume of new credit requested from financial entities.”
“The result has been obtained in a macroeconomic scenario marked by high inflation and the consequent growth in interest rates, which are causing a significant decrease in savings and a slowdown in the demand for credit and investment,” explained the pilot entity. by Eduardo Ruiz de Gordejuela.
“The dynamism of the economy has experienced a certain moderation and the growth forecasts for the next two years have been revised slightly downwards, mainly due to the worse performance expected for activity and the rise in energy prices,” added Kutxabank.
Forecasts
According to the kutxas bank, the new production of mortgages, consumer loans and financing for companies in these first nine months of the year “is above the sector averages, and even exceeds internal forecasts.”
The Group has continued to improve its digital banking model and customer outreach. Digital sales have grown in the main products during the first nine months, with a notable increase compared to the same period of the previous year, due to the greater availability of digital solutions. The contracting of products and services through digital channels has reached 46% of total operations, and the percentage of clients who are digital users is now 62%.
A quick look at the income statement shows that all the main margins are growing significantly, highlighting the so-called ‘core’ income or the typical banking business, with an increase of 44% to exceed 1.3 billion.
The contribution of the portfolio of investees (which includes, among others, CAF, Iberdrola, Petronor or Inteam), mainly through the collection of dividends and the contribution of associates, has stood at 83 million, slightly lower (1 %) to that of 2022. Consequently, the gross margin has been 1,295.8 million, 47% better than in 2022.
The good business has been accompanied, as Kutxabank highlights, by an increase in operating expenses, which have grown by almost 7%, “mainly due to the increase in personnel costs and the acceleration of the digitalization process.”
Investment funds
Customer resources managed by Kutxabank have continued to grow to 77,935 million euros, 7.8% more, driven by the aforementioned off-balance sheet resources and the “strong acquisition of wholesale banking”, that of companies and institutions. As explained by the entity, growth of 25% has been generated in investment funds, 12% in term savings and savings plans, and 7% in pension products.
Throughout the year Kutxabank has remained in the top positions in attracting investment funds. Until the third quarter, it has been the fourth entity with the highest net subscriptions, since it has captured a total of 2,546 million, 13% of the total new entries in the market. At this time the bank has almost 25,000 million managed in investment funds and delegated portfolios, and maintains a market share of 7.43%, 39 basis points more than at the end of last year.
Credit to companies
As explained by the bank, the rise in interest rates is affecting the evolution of credit, “which has contracted.” Despite this, he added, “Kutxabank’s credit investment has remained stable at over 47,000 million”, supported not so much by mortgages but by the aforementioned wholesale banking, on which the entity wants to focus on everything. Spain.
In this sense, Kutxabank has detailed that “the improvement that the financing activity for the needs of companies has been registering in recent quarters has been confirmed by subscribing 3,518 million euros in new formalizations in the first nine months, with a notable growth in 17% in the balance of financing destined for larger companies and corporations.
Kutxabank has allocated a total of 2,524 million euros to new mortgage loans until September, above its forecasts. It should be noted that the balance of new formalizations in the third quarter (July to September) is well above – 59% – the financing formalized in 2022 in the same period.
Consumer loans, for their part, have grown by 10%, and by 60% in commercial credit, “which reflects the strength of the turnover of the commercial sector,” the entity concluded.
#Interest #rates #give #wings #Kutxabank #earns #September