The following is a summary of the CaixaBank, S.A. (CAIXY) Q4 2023 Earnings Call Transcript:
Financial Performance:
CaixaBank reported a 54% increase in net income in Q4 2023 and proposed an interim dividend payment to be made in November.
A significant increase in business lending, consumer lending, and mortgages was observed, boosting their financial performance.
They maintained a strong balance sheet throughout the year, with an efficiency ratio of 40.9% and a return on tangible equity of 15.6%.
The company's CET1 stood strong at 12.4%, showing a notable capital distribution capacity rise to approximately €12 billion.
The bank's net income for the quarter was €115 billion, with a NII surge of 40% year-on-year and 54% for the year.
CaixaBank ended the year with an increase in customer funds by 1.8% quarter-on-quarter and loan book reduction by 2%.
The cost of risk remained around 30 basis points, with an expectation to partially use their €800 million in unassigned provisions in 2024.
The bank reported a trading value of 0.9 times tangible book and less than 0.8 times to 0.7 times book value, with a tangible book at 4.2%.
Business Progress:
CaixaBank further reinforced its focus on sustainable finance, with mobilization rising to €50.8 billion, surpassing the target for the three-year plan.
The bank showed progress in its market share of savings insurance, now standing at 36.5%.
An emphasis was laid on the recovery and sustainability of profitability along with robust capital distribution capacity.
With strategic efforts on growth in all areas, the bank noted a market share in new lending production above 20% expected to increase in 2024.
For 2024, the bank aims to achieve organic growth of their business with no intention of mergers and acquisitions outside core markets.
The bank announced that there'll be more updates on their capital distribution plans during the second half of the year.
Focusing on key business engines, they expect to maintain an NII in line with 2023 at €10.1 billion.
The bank aimed to focus on synergies with former Bankia clients and reducing OREO exposure in 2024.
They also disclosed plans around managing the rate sensitivity and the associated risk management strategies.
Looking towards 2025, the rate sensitivity is expected to maintain around 5% with plans of implementing more hedges in place.
More details: CAIXABANK SA UNSP ADR EA REPR 1/3 ORD EUR0.00 IR
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