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Investing.com -- Unicaja Banco SA (BME:UNI) on Friday reported third-quarter net income of €165 million, exceeding consensus expectations of €150 million by 10%, driven by better cost of risk and solid net interest income.
The Spanish bank’s profit before tax was 9% above consensus, while pre-provision profit beat estimates by 1%. Total revenue exceeded expectations by 1%, and costs were in line with analyst projections.
Net interest income slightly beat consensus by 1%, remaining flat quarter-on-quarter but declining 2% year-on-year. Customer spreads narrowed by 8 basis points in the quarter as loan yields decreased by 14 basis points, partially offset by a 6 basis point reduction in deposit costs. The bank’s ALCO portfolio decreased by €1 billion to €29 billion during the quarter.
Net fee income met consensus estimates, showing strong performance in asset management and insurance fees, though banking fees continued to lag. Equity method income exceeded expectations by €4 million.
Unicaja recorded total impairments of €44 million, below the consensus estimate of €59 million. The cost of risk for the quarter stood at 26 basis points, similar to the first quarter and better than the full-year 2025 guidance of approximately 30 basis points.
Loan growth remained sluggish compared to peers, with customer loans 1% below consensus, down 3% quarter-on-quarter and flat year-on-year. Customer deposits including repos were 2% above consensus, increasing 2% quarter-on-quarter and 1% year-on-year, though deposits excluding repos fell 2% quarter-on-quarter and were flat year-on-year.
The bank’s capital position remained strong, with a fully loaded CET1 ratio of 16.1%, beating consensus by 10 basis points. CET1 was 2% better than expected, while risk-weighted assets were 1% higher than anticipated.
For the first nine months of 2025, Unicaja achieved an adjusted return on tangible equity (RoTE) of 12.3%, exceeding its new guidance of approximately 12%.
The bank upgraded its 2025 guidance, now expecting net interest income to exceed €1,470 million (up from previous guidance of over €1,450 million), cost of risk below 30 basis points (improved from approximately 30 basis points), and adjusted RoTE of around 12% (up from approximately 11% previously).