Unicaja Banco reported a net profit of 285 million euros for the first nine months of the year, marking a 4.9% rise versus the same period last year. Profit before tax grew 11.2% to 413 million euros as of September. The Malaga-based lender noted that, excluding the impact of a banking tax of 63.8 million euros fully recognized in the first quarter, net profit would have reached 349 million euros, up 28.4% year over year to September 2022.
In particular, net profit for the third quarter rose to 137 million euros, reflecting a quarterly increase close to 20.4% compared with the previous quarter of the year.
The group’s results were supported by higher ordinary income, a 25.4% year-on-year expansion in interest income, and a 1.6% rise in net commissions, alongside reduced personnel costs and lower provisions. Loan losses also declined by 12.8%.
“These outcomes come with an improvement in balance sheet quality and a stable, solid solvency and liquidity position,” stated Unicaja Banco, chaired by Manuel Azuaga with Isidro Rubiales serving as CEO.
All margins showed year-on-year gains. Net interest income climbed 25.4%, supported by the retail segment. Even before accounting for the full Euribor-driven uplift, customer margins rose by 121 basis points on an annual basis to 2.61%, aided by a tightly managed financing cost. Gross margin expanded by 5.9%, operating margin before provisions advanced by 14.4%, and earnings from ordinary activities grew by 25.4%.
Excluding the banking tax, the efficiency ratio improved by six percentage points over the year to 45.9%.
Credit investment and customer resources
The realized loan investment balance reached 49,533 million euros amid a backdrop of softened financing demand, earlier repayments of variable-rate loans, and a rise in maturities for ICO-supported loans.
“In this environment, mortgage lending to individuals fell by 1.4% in the quarter to 30,641 million, while consumer lending rose 2.1% year over year. In the first nine months, 5,179 million euros were approved as new loans, including 1,866 million for individual mortgages, with mortgage formalizations maintaining a market share of 7.4% of the national total, above Unicaja Banco’s natural share,” the bank noted.
Retail customer resources totaled 87,536 million euros. Unicaja Banco highlighted that its deposit base is highly granular and stable, with individuals contributing 75% of the total.
Term deposits rose 64.9% year over year and 9.5% in the quarter. Off-balance-sheet and insurance resources increased by 3.2% versus the prior year, reaching 20,759 million; savings and insurance products grew by 9.7%, while mutual funds, portfolio management subscriptions, and pension funds contributed smaller gains. The total managed resources stood at 98,411 million euros.
Reducing non-productive assets
The stock of non-performing assets continued to decline. The annual reduction reached 13.1%, driven by a 15.3% drop in seized asset levels and an 11% drop in doubtful assets.
The improvement in NPAs was accompanied by higher coverage, underscoring the bank’s typically prudent approach. The coverage rate for non-productive assets rose by 2.1 percentage points year over year to 66.2%. The ratio of doubtful assets increased by one point to 65.8%, and the share of seized assets rose by 3.2 points to 66.6%. The default rate fell by 23 basis points to 3.39%, while the cost of risk remained modest at 30 basis points.
Unicaja Banco reiterated its strong solvency position. Fully loaded CET1 reached 14.2%, up 1.2 percentage points from September 2022, comfortably above regulatory requirements by about 6.2 points. Liquidity remained ample, with the LCR at 259% and the NSFR at 147%.
Digital business and commercial performance
The Digital Plan outlined in the 2022-2024 Strategic Plan continued through the third quarter of 2023. Initiatives implemented under this plan contributed to growing the base of digitally active customers, including the development of a Remote Sales platform tailored to product groups.
By the end of the third quarter, 64% of customers were digital. About 31% of new customers joined through digital channels. Digital channels accounted for 49.4% of new consumer loan contracts, 20.5% of new accounts, and 26% of mutual funds or managed portfolios.
The bank also launched a new, complimentary service featuring 150 digitization managers who assist users. These professionals are assigned to key offices across different business areas to support and train customers in using digital banking and ATMs.