Banco del Bajío ScA Institución de Banca Múltiple (BBAJIO O) Q4 2024 earnings summary

Executive summary

• Net income for 2024 was MXN 10.7 billion, down 2.9% year-over-year; Q4 net income was MXN 2.54 billion, 8.8% lower than Q4 2023 but up 0.6% sequentially.

• Revenues for 2024 reached MXN 26 billion, up 4.5% year-over-year; Q4 revenues were MXN 6.4 billion.

• ROE for 2024 was 24.5%; Q4 ROE was 22.9%.

• Most 2024 guidance targets were met, reinforcing management's credibility.

• Net interest margin (NIM) for 2024 was 6.8%; Q4 NIM was 6.7%, down 69 bps year-over-year.

Financial highlights

• Operating income for 2024 was MXN 14.57 billion, down 3.2% year-over-year; Q4 operating income was MXN 3.33 billion.

• Net interest income for 2024 was MXN 22.81 billion, up 2.9% year-over-year.

• Loan portfolio grew 10.9% year-over-year to MXN 266 billion; total deposits increased 6.6% to MXN 247 billion.

• Efficiency ratio was 39.2% in Q4 and 35.3% for the year.

• Consumer loan portfolio grew 21.8% year-over-year to MXN 7.1 billion.

Outlook and guidance

• 2025 guidance: loan growth 8%-11%, deposit growth 9%-11%, NIM 6.2%-6.3%.

• Net income guidance: MXN 9.3-9.8 billion; ROE 19.5%-21%; capitalization ratio above 14%.

• Fees and trading income expected to grow 3%-5% (15%-18% excluding one-timers).

• Expense growth guided at 10%-12%, efficiency ratio 39%-41%.

• Cost of risk expected at 80-100 bps, NPLs below 1.6%, coverage ratio above 1.2x.