Banc Sabadell earns 29% less, up to 347 million
The entity attributes the results to the impact of the early retirement plan and the reduction in the interest margin, which it expects to improve for the rest of the year
BarcelonaBanco Sabadell begins the year with a net profit of 347 million in the first quarter, a 29% decrease compared to a year ago due to the impact of measures such as the early retirement plan involving about 300 people; or the already anticipated reduction in net interest margin (resulting from the difference between what it charges for loans and what it pays for deposits) due to falling interest rates.
The entity, which celebrates its shareholders' meeting this Wednesday and will leave the BBVA takeover bid completely buried once the sale of its British subsidiary, TSB, to Banco Santander is closed once the sale of its British subsidiary, TSB, to Banco Santander is closed, highlights the increase in credit volume across all business segments. It emphasizes, for example, consumer credit, with a 14.8% increase, to 5.5 billion; mortgages, 4.1%, to 39.8 billion; or credit directed at SMEs and large companies, with a 2.1% increase, to 44.8 billion. The bank anticipates that in the second quarter, capital gains from the sale of TSB will have a positive effect on its accounts.
César González-Bueno, CEO of the group, who will leave the position after more than five years and will be succeeded in this new post-takeover bid phase by Marc Armengol, former head of TSB and a company veteran; states that the entity maintains its forecasts of reaching a profitability of 16% next year by the end of the 2025-2027 strategic plan. It also continues with the commitment to shareholder remuneration of approximately 6.45 billion until 2027, which includes the 50 cents extraordinary dividend per share to be paid on the 29th of this month for the sale of the British subsidiary for 3.3 billion euros.
Less commissions
Net interest income, 872 million, fell 3.5% year-on-year, a decrease already foreseen by the trend in interest rates. The bank expects the trend to gradually improve until the end of the year, reaching growth above 1% due to higher and more volatile interest rates and an increase in business volumes. Net fees, 315 million, fell 2.2% due to lower contributions from service fees. Customer resources, excluding TSB, amount to 184,768 million, 5.9% more than a year ago.
The other variable that has affected profits, 55 million for the new early retirement plan in Spain, will have a total cost of 90 million this year. This measure, the bank adds, will allow for annualized savings of 40 million gross from 2027 onwards, but one-third of this amount will already be achieved this year, according to the entity.
The CET1 ratio fully loaded, the main metric of financial strength, which essentially includes core capital --mainly ordinary shares and reserves-- stood at 13.2% at the close of March. The non-performing loan ratio excluding TSB decreased to 2.55%, compared to 2.65% a year ago.