Banca IFIS (IF) H1 2024 earnings summary

Executive summary

• Net income for Q2 2024 reached €46 million, up 3% year-on-year; H1 net profit attributable to the Parent company was €93.6 million, up 2.8% year-over-year, reflecting resilient revenues across all divisions.

• Revenues remained resilient across Commercial Banking, NPL, and Proprietary Finance, offsetting increased funding costs.

• Asset quality remains strong with no signs of widespread deterioration; overlays on performing loans remain unused and above peers.

• 2024 net income guidance of €160 million is confirmed, factoring in typical Q3 seasonality and assuming no macroeconomic shocks.

• Solid liquidity position with €1.7 billion available cash and CET1 ratio at 15.32% as of June 30, 2024.

Financial highlights

• Revenues in Q2 2024 were €189 million, up 9.6% year-on-year; H1 net banking income rose to €374.5 million (+7.5%).

• Commercial banking contributed €87 million (up 13% year-on-year); NPL revenues €86 million, driven by judicial activity.

• Quarterly cash collection from NPLs (excluding Revalea) was €94 million, showing healthy portfolio performance.

• Operating costs rose 7.5% to €206.1 million, mainly due to higher personnel, IT, and marketing expenses.

• CET1 ratio increased to 15.32% after deducting accrued dividends; LCR above 1,250%.

Outlook and guidance

• 2024 net income guidance of €160 million is reiterated, with interim dividend payment planned for November 2024.

• Dividend policy remains unchanged, targeting €110 million payout if guidance is met.

• New three-year business plan to be presented in H1 2025.

• Sensitivity to a 50bps rate cut reduced to €9–11 million, with further actions planned to lower it to €5–8 million.

• Tax incentives approved in Q2 2024 expected to accelerate leasing market in H2 2024.