BPER Banca (BPE) Q1 2025 earnings summary

Executive summary

• Achieved record adjusted net profit of €443 million in Q1 2025, up 43.2% year-on-year, driven by strong commission growth, cost efficiency, and high-quality revenues despite lower NII from rate cuts.

• Strategic plan (B-dynamic full value 2027) is fully on track, with 100% of initiatives launched and significant progress in digitalization and ESG lending.

• Announced business combination with Banca Popolare di Sondrio (BIPSO/BPSO) to create a leading Italian banking group, targeting €7 billion revenues and 15% ROT by 2027.

• Asset quality remains robust, with cost of risk at 31bps and NPE coverage ratio stable at 54.2%.

• Capital ratios strengthened, with CET1 at 15.8% and organic capital generation of €540 million in Q1 2025.

Financial highlights

• Core/total revenues reached €1.43 billion, up 5.0% year-on-year; commission income grew 8.5% to €541.1 million, with AUM fees up 18.7%.

• Loan origination totaled €4.4 billion (+22.3% year-on-year), with 60% to entrepreneurs and corporates.

• Cost-to-income ratio improved to 46.7%, with total costs down 3.2% year-on-year; headcount reduced by 1,000 since June 2024.

• Loan loss provisions fell over 25% year-on-year to €71 million; cost of risk dropped to 31 bps.

• LCR at 166% and NSFR at 134% at March 2025.

Outlook and guidance

• FY25 guidance: total revenues expected at ~€5.4 billion (down mid-single digit vs FY24), net commission income up mid-single digit, cost/income ratio ~51%, cost of risk <40bps, CET1 ratio >15%.

• 75% average dividend payout planned for 2025–2027, with potential for higher payout if capital allows.

• All combined financial targets for the BPER-BPSO group remain unchanged post-offer, with >€7bn total revenues and >€2bn net income targeted for 2027.

• Macroeconomic outlook remains cautious, with global GDP growth moderating to 3.1% and Italy's GDP expected to grow by 0.6% in 2025.