Three-month progress summarized 2023 record AbancaIt followed the country’s major financial operators following a very strong increase in interest rates. It was. The leader of the sector in Galicia earned 711 million euros in revenue at the end of the year, 227% more, “the year we made the most profit”As the President emphasized in his account presentation yesterday. Business targets originally planned for 2024 have already been achieved; Juan Carlos Escotet hopes to “definitely exceed” a historical maximum on this target. In addition to “indisputable good governance”, the organization’s leader attributed the result to “the resilience of the Spanish economy, the strength of employment and the containment of inflation”. Profitability increases to 16%, “which clearly allows us to comfortably cover them despite the increase in capital costs of the entire bank due to the state of new rates in the market.”
The difference between what Abanca earned from loans a year ago The amount I paid as deposit did not even reach 2%. The so-called trade spread amounted to 3.2% in the fourth quarter of 2023; new loan concessions averaged 5.10% (compared to 4.05% for previous loans in the portfolio), and fees on term accounts fell slightly: For operations formalized between October and December, it decreased from the previous 1.90% to 1.84%. Herein lies the key to the increase in interest margin: almost 1 billion 232 million euros, after an annual increase of 61%.
With the acquisition of Targobank, the normal loan volume increased by 0.4 percent to 45 billion 190 million euros. As detailed by CEO Francisco Botas, the increase will be 11.2%, thanks to the contribution of Abanca’s recently acquired Portuguese bank EuroBic. Loans increased by 15.3% in the Portuguese market and 14% in Spain. The group approved 10,000 new mortgages and 23,000 funding injections for SMEs and the self-employed.
Despite the slowdown in the economy, default is not a concern. Default rate increased Slightly higher than 2.1% in December 2022 (943 million) 2.4% (1,130 million) at the end of 2023. The system average was 2.9%. “These are small numbers that do not change the profile of the organisation. We continue to have one of the lowest rates in the industry“And if GDP continues to grow as it has so far, this will not change,” Botas said. he emphasized.
Escotet also brings into the equation record employment levels and the “expectation of interest rate cuts” that even the European Central Bank (ECB) has hinted at. Of course, the Abanca president warns: “Growth of new production will be more challenging and portfolio stocks will likely show negative growth at the end of the year.” That is, more loans will be amortized than are issued. The coverage of doubtful assets is around 74% and 63% in seized assets..
Deposits increased by 9.5%, exceeding 53.5 billion euros. Abanca earns 17 basis points in the national market and 15 basis points in Portugal. 93 percent come from families and companies, and 71 percent have a balance of less than 100,000 euros. A “very detailed” savings basket, according to its top executives. The insurance business grew by 12.9% (close to 14,000 million), with intense advances in all branches: 17% in health premiums, 13% in automobiles, 13% in corporate and 11% in life risks.
Abanca boasts a growth strategy that includes organic and acquisitions, resulting in 130,000 new customers in 2023. There are seven corporate operations. Targobank’s technological integration will be completed in mid-June, and regulatory authorities’ permission to adopt EuroBic will come around the same time, and Abanca will become the seventh bank in Spain and Portugal with a business volume of 124,000 million. The excess capital in excess of regulatory targets is €1,499 million. Escotet insists Attention to “complementary” opportunities is a “brand”but he sees the margin for new purchases gradually shrinking because, with the improvement in other people’s profitability, “the appetite for selling is clearly diminishing.”
Entity insists: “There is no rush” regarding Nueva Pescanova
Nueva Pescanova made it official last October that she had broken off her relationship with Canadian Cooke. Already at that time, its largest shareholder argued that it was confident in the change of direction with the new management team headed by Jorge Escudero as CEO and that it would remain that way. “Although our aim is to find the best financial and industrial partner, we are in no rush. Confirming that the roadmap is “protected” and “there is no regulatory imposition”, Juan Carlos Escotet said: “I think the work done by the new team is really good, despite the difficulties experienced by the whole industry.” disinvestment.” “We will do so when deemed appropriate,” he added. He also praised the management of Deportivo, which “will definitely emerge from bankruptcy by mid-year”.
“We believe that the bank tax will disappear”
“Frankly, this is not a very good assessment,” admitted Juan Carlos Escotet when asked about the Government’s decision to extend the special tax on banks for at least another year due to high profits made in an environment of high interest rates. The Abanca president did not explain how much the additional fee meant in the institution’s accounts in 2023. It provides all tax invoice information. approximately 400 million euros and regulatory costs at 138.3 million. “The impact on credit and competitiveness is clearly detrimental,” he says, blaming this on the fact that listed Spanish banks have a worse valuation than other European institutions. Escotet believes there is “room for negotiation” and is confident that negotiations will not be extended again.