illimity Bank (ILTY) Q2 2025 earnings summary

Executive summary

• The first half of 2025 was marked by significant macroeconomic and geopolitical uncertainty, with a challenging environment for global and European markets.

• The group recorded a net loss of EUR 117.8 million (or €118 million), reversing a EUR 23 million profit in the same period last year, mainly due to substantial credit risk adjustments and non-recurring items.

• Strategic repositioning continued, focusing on core Corporate & Investment Banking and separating non-core assets for run-off and derisking.

• The period saw the successful public tender and exchange offer by Banca IFIS, resulting in illimity becoming part of the Banca IFIS Group as of July 2025, with integration and Board resignations to facilitate delisting.

Financial highlights

• Total net operating income fell 21% year-over-year to EUR 123.9 million, driven by lower net interest and fee income.

• Net interest margin dropped 26% to EUR 58.3 million, mainly due to asset transformation, lower market rates, and strategic repositioning.

• Net fee and commission income declined 33% year-over-year to EUR 30.9 million.

• Operating expenses increased to EUR 110.5 million, impacted by EUR 8.4 million in one-off advisory costs and EUR 1.6 million in software write-offs.

• Net value adjustments for credit risk surged to EUR 121.8 million, reflecting significant write-downs on securitisation notes and distressed assets.

Outlook and guidance

• Following the acquisition by Banca IFIS, future activities will align with the new group's strategic direction and management guidelines.

• The board of directors has resigned to facilitate the merger and delisting, with changes effective after the September 2025 shareholders' meeting.