Ibercaja obtained a net profit of 54.5 million euros during the first quarter of the year, which represents an increase of 61% year-on-year after having reduced the load on provisions made in the face of possible deterioration by Covid and improving business volumes despite to the context still marked by the pandemic.
The entity obtained a net profit of 54.5 million euros
The entity, which recently presented a new strategic plan where it rules out getting involved in mergers, provisioned 33.9 million and that implies 32.6% less compared to the first quarter of 2020 where it scored extra endowments for 34 million by the Covid, as reported this Thursday the entity to the National Securities Market Commission (CNMV).
Its improved result is supported by increased commercial activity. Specifically, customer funds increased by 1.5% compared to the end of last year and by 16.4% in a year-on-year comparison, to 66,391 million euros, while the new credit concession increased almost 30%.
The expansion in customer funds was supported especially by a 16.4% year-on-year increase in assets under management and life insurance, with advances of 24.4% in mutual funds and 23.4% in individual pension plans and 10.7% in groups, and 41.1% in the insurance business.
The granting of new credit increased by 29.9% compared to the same quarter of the year, particularly driven by the signing of operations with companies alone or together with ICO guarantees and whose balance increased by 6.9% only in the stagnant quarter or against the end of the year 2020.
Despite the evolution of the business, the interest margin decreased by 8.2% year-on-year, conditioned by the impact of negative interest rates on the performance of the loan portfolio.
An evolution that led recurring income, which includes net interest and commissions, to fall by 3.4% to 220.4 million, despite the fact that total commissions increased their contribution by 3.3%.
The bank specified that it hopes to achieve a “flat behavior of annual income in 2021 thanks to the recovery of the expected activity.”
In the lower part of the account, total expenses also increased by 5.6% in the quarter, but it also foresees an improvement or reduction of the heading since as of the second quarter, the 750 departures of personnel foreseen in its Employment Regulation File (ERE).
Regarding the quality and strength of the balance sheet, Ibercaja closed March with a capital ratio CET1 ‘fully loaded’ or maximum requirement of 12.6%, and its delinquency fell by 21 basis points, reaching 3%, with a coverage ratio of problem assets of 64.1%.