BPER Banca (BPE) Q4 2024 earnings summary

Executive summary

• Adjusted net profit for 2024 rose 4.1% year-over-year to €1.41 billion, driven by core revenue growth, lower cost of risk, and robust asset quality.

• Core revenues increased 4.1% year-over-year, with cost/income ratio stable at 50.3%.

• CET1 ratio improved to 15.8% due to €1.7 billion in organic capital generation.

• Proposed dividend of €0.60 per share, doubling year-over-year, with a 61% payout ratio.

• Announced a proposed business combination with Banca Popolare di Sondrio to create Italy's third-largest banking group by TFAs, deposits, and loans.

Financial highlights

• Total revenues reached €5.6 billion, up 1.8% year-over-year, with core revenues at €5,435.3 million (+4.1%).

• Net interest income grew 3.9% to €3.4 billion; net commission income up 4.5% to €2.1 billion.

• Operating costs rose 3.6% year-over-year to €3,034.2 million; cost/income ratio at 50.3%.

• Loan loss provisions fell over 20% to €333.3 million, reducing cost of risk to 36 basis points.

• Dividend per share proposed at €0.60, payout ratio 61%, more than double last year.

Outlook and guidance

• 2025 net profit is expected to be slightly above 2024, with NII in line with 2023, continued positive commission income, lower operating costs (excl. D&A), and slightly higher cost of risk.

• Business plan targets and payout ratio of 75% remain unchanged; all guidance based on standalone perimeter, excluding the impact of the proposed merger.

• 80% of initiatives for the 2027 plan have been launched, with 100% to be running by 1H25.