Banco BPM (BAMI) H2 2025 earnings summary

Executive summary

• Net profit for 2025 reached €2.08 billion, surpassing guidance by €130 million and nearing the 2027 strategic plan target, with a 20% year-over-year increase excluding one-offs and Anima consolidation.

• Business model now delivers a 50/50 split between net interest income and commissions, with non-NII revenues at 51% of total, enhancing sustainability and diversification.

• CET1 ratio pro-forma at 13.76%, well above the 13% plan threshold and regulatory requirements, reflecting robust capital generation.

• Dividend per share set at €1.00, with a payout ratio of 80% and total shareholder remuneration for 2024/25 reaching €3 billion, representing 50% of the 2024-2027 target.

• Strong new lending generation, up 33% year-over-year, with customer financial assets at €396 billion.

Financial highlights

• Total revenues for 2025 were €5.96 billion, up 4.4% year-over-year, with core revenues up 2.5%.

• Net fees and commissions rose 21.4% to €2.5 billion; net interest income was €3.13 billion, down 9.1% year-over-year.

• Cost/income ratio improved to 46% from 47% in 2024; operating costs decreased 1.7% year-over-year on a like-for-like basis.

• Gross NPE ratio reduced to 2.2%, net NPE at 1.22%, with coverage at 56% (excluding state guarantees) and NPE stock at a record low.

• Cost of risk improved to 40 bps, with total provisions down 26.3% year-over-year.

Outlook and guidance

• Confident in reaching €2,150 million net income target for 2027, with sustainable profitability and dividend capacity.

• 2026 guidance remains conservative, with expectations to offset €100 million headwinds from new taxation and systemic charges.

• NII expected to remain stable or slightly above €3 billion in 2026, with replicating portfolio providing a tailwind.

• Cost of risk guidance for 2026 at 43 bps, with potential for improvement if default rates remain low.

• Tax rate expected to rise to 33% in 2026 due to budget law changes.