BPER Banca (BPE) Q2 2024 earnings summary

Executive summary

• Revenues grew 4% year-over-year to €2.8 billion in H1 2024, with core revenues up 7% half-on-half to €2.7 billion, reflecting business model resilience and strong commercial dynamics.

• Adjusted profit before tax rose 15.9% half-on-half to €1.1 billion, driven by core revenue growth and stable operational efficiency, with cost/income ratio at 50.6%.

• Net profit for 1H24 reached €724.2 million, up 2.8% year-over-year, with adjusted net profit at €697.7 million.

• Asset quality remains high, with NPE ratio at 1.3%, cost of risk at 41 bps, and coverage ratios among the highest in Italy.

• CET1 ratio improved to 15.3% due to organic capital generation of 199 bps in H1 2024; liquidity ratios (LCR 161.4%, NSFR 134.6%) remain strong.

Financial highlights

• Net interest income was €1.7 billion (+8.9% half-on-half); net commission income €1.0 billion (+4.0% half-on-half), with AUM fees up 13.4%.

• Operating costs rose 4.2% half-on-half to €1.4 billion, with cost/income ratio flat at 50.6%.

• Loan loss provisions fell 34.1% to €175 million, reducing cost of risk to 41 bps.

• Total financial assets grew €17.6 billion year-over-year to €298.7 billion, with AuM up 8.3% year-over-year.

• EPS for H1 2024 at €0.512.

Outlook and guidance

• 2024 guidance reaffirmed: net interest income revised to stable, net commission income unchanged, operating costs revised upwards, cost of risk improved, net profit and CET1 ratio unchanged.

• Asset quality expected to improve further, with cost of risk slightly better than 2023.

• New business plan and updated dividend guidance to be presented in October 2024.