Artea bankas (ROE1L) Q2 2025 earnings summary

Executive summary

• Completed rebranding to Artea Bank, transitioning from a regional to a national bank, with all subsidiaries, branches, website, and app updates delivered on time and within budget.

• Strategic initiatives, including a cloud-based core banking system upgrade and new product launches, are progressing on schedule and within budget, with full launch expected mid-2026.

• Loan book growth rebounded in Q2, with the mortgage portfolio surpassing €1 billion and strong performance in corporate and private client segments.

• Share buyback program's second phase completed, with plans to resume buybacks in Q3, reinforcing commitment to shareholder returns.

• Net profit for H1 2025 was €31.9 million, a 26% decrease year-over-year, with operating profit before impairment and tax at €42.9 million.

Financial highlights

• Net profit for H1 2025 was €31.9 million (adjusted: €36.9 million), down 26% year-over-year; Q2 profit was €17 million.

• Net interest income for H1 2025 was €68.4 million, down 15% year-over-year, but flat sequentially.

• Net fee and commission income grew 10% year-over-year to €15.1 million, driven by asset management and renovation financing.

• Loan book grew 15% year-over-year to €3.7 billion; deposits up 11% to €3.53 billion.

• Book value per share rose to €0.87, up 4% year-over-year.

Outlook and guidance

• Expecting double-digit loan book growth for 2025.

• Net interest margin projected to remain stable despite anticipated Euribor rate cuts and a declining rate environment.

• Fee income expected to maintain current run rate, with further growth potential in asset management and capital markets.

• Cost discipline and proactive cost management prioritized amid revenue headwinds.

• Minimum dividend payout policy of 50% of prior year profit, with no cap on maximum payout and >20% total shareholder return targeted.