ProCredit (PCZ) Q1 2025 earnings summary

Executive summary

• Achieved strong Q1 2025 performance with 2.5% loan growth, net result of EUR 25.2m, and annualized ROE of 9.5%, driven by micro, small, and private individual loan segments and strategic investments leveling out.

• CET1 ratio stood at 13.1%, with cost-income ratio elevated at 70.8% due to prior investments, but expected to improve as scaling effects materialize.

• Customer deposits slightly declined by 0.7% to EUR 8.2bn, while private client deposits increased in share.

• Promoted to the SDAX index, enhancing capital market visibility and marking a strategic milestone.

• All geographic segments except South America contributed positively; Ecuador continued to negatively impact results due to macroeconomic and security challenges.

Financial highlights

• Net result for Q1 2025 was EUR 25.2m, with CET1 ratio at 13.1% and cost-income ratio at 70.8%.

• Net interest income declined 5.7% year-over-year to EUR 85.0m, mainly due to lower policy rates and negative repricing.

• Net fee and commission income increased 7.2% year-over-year to EUR 22.6m, driven by payment and FX services.

• Loss allowances remained low, with a net release of EUR 0.8m and strong recoveries of written-off loans.

• Earnings per share were EUR 0.43, down from EUR 0.57 in Q1 2024.

Outlook and guidance

• 2025 outlook unchanged: loan portfolio growth target of ~12%, ROE around 10%, cost-income ratio near 68.1%, and CET1 ratio around 13%.

• Medium-term ambitions: loan portfolio >EUR 10bn, ROE of 13-14%, cost-income ratio ~57%, and 33% dividend payout.

• Dividend policy unchanged, with a proposed payout of EUR 0.59 per share for FY 2024.

• Risks include economic disruptions, supply chain and energy sector issues, funding market changes, interest rate margin pressures, inflation, and exchange rate volatility.