CaixaBank reports solid Q2 with 9% profit beat, upgrades guidance

Investing.com -- CaixaBank on Wednesday reported second-quarter attributable profit of €1,482 million, exceeding company-compiled consensus by 9%, driven mainly by lower impairments and a positive one-off in other income.

The Spanish bank’s pre-tax profit beat expectations by 6%, while pre-provision profit came in 3% above consensus.

Total (EPA:TTEF) revenue exceeded forecasts by 2%, primarily due to stronger other revenues, while costs were in line with expectations.

Net interest income was 1% above consensus, remaining flat quarter-over-quarter but down 6% year-over-year. Customer spreads decreased by 11 basis points in the quarter, with loan yield declining 28 basis points and client funds costs dropping 17 basis points.

The bank increased its ALCO portfolio by approximately €6 billion during the quarter.

Wealth management, protection insurance, and banking fees collectively beat consensus by 1%, showing strong performance in wealth management revenues and banking fees due to robust corporate and investment banking activity.

Other revenues reached €90 million compared to the expected €53 million, including a €22 million boost from the reversal of the solidarity levy in Portugal.

Impairments and other gains totaled -€264 million, better than the consensus estimate of -€321 million. The annualized second-quarter cost of risk was 18 basis points, prompting an upgrade to the full-year 2025 guidance.

Customer loans grew 4% quarter-over-quarter and 5% year-over-year, exceeding consensus by 3%. Similarly, customer deposits increased by 4% quarter-over-quarter and 8% year-over-year, also 3% above consensus.

The bank reported a CET1 capital ratio of 12.5%, 10 basis points above consensus, with CET1 2% above expectations, though risk-weighted assets were 2% higher than anticipated.

CaixaBank upgraded several aspects of its 2025 guidance. While net interest income guidance remains unchanged at a mid-single-digit decline year-over-year, the bank indicated that the second quarter of 2025 represents the cycle low, with improvement expected to accelerate from the second half of 2026.

Revenue from services is now projected to increase by mid-single digits year-over-year, up from the previous guidance of low to mid-single digit growth.

Cost guidance remains unchanged at approximately 5% growth year-over-year. The cost of risk forecast improved to approximately 25 basis points, down from the previous guidance of less than 30 basis points.

Return on tangible equity is now expected to exceed 16%, compared to the previous estimate of approximately 16%. The dividend payout range remains at 50-60%.

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