BFF Bank (BFF) Q4 2024 earnings summary

Executive summary

• Reported net profit for FY24 reached €215.7m, up 26% year-over-year; adjusted net profit was €143.0m, reflecting a challenging environment but signs of recovery in Q4, especially in Italian factoring.

• Loan book grew by 5% year-over-year to €5.9bn, with Italy up 7% and record new volumes achieved in Q4.

• Off-balance sheet reserves, mainly LPI, rose to €529m, up €61m since June 2024.

• Over 50% of past due portfolio collected in 2H24; contagion invoices down €80m (-19%) from June 2024.

• Management revised 2026 targets due to a lost year from reclassification and past due focus, now expecting adjusted net profit of ~€240m and RoTE over 40%, with strategy and outlook unchanged.

Financial highlights

• Total revenues up 2% year-over-year excluding 1Q23 capital gain; stable including it.

• Loan-to-deposit ratio at 69%, up from 62% last year, with deposits at €8.5bn and ample liquidity.

• CET1 ratio at 12.2% and total capital ratio at 15.1%, both above regulatory requirements.

• Issued €600m senior bond to meet MREL requirements.

• Payments and securities services segments delivered strong results, with payments revenue up 7% year-over-year and deposits in securities services up 8%.

Outlook and guidance

• Revised 2026 targets: adjusted net profit ~€240m, RoTE >40%, cumulative dividends >€560m (subject to regulatory approval and removal of Bank of Italy restrictions).

• Expectation of continued loan book growth at 10%+ per annum, with potential acceleration depending on market conditions.

• Anticipate recovery in factoring and lending, especially in Italy, and improved collection performance due to return to injunction process.

• France branch expected to open by YE25, new Porto office in 1H25, and focus on international growth.

• No benefit from Late Payment Regulation included in guidance; potential upside from regulatory and legal developments.