Highlights
- Good performance in lending activity.
- Positive trend of operating expenses.
- Net attributable profit affected by the decline in income in an environment of negative interest rates.
- Improvement in risk indicators.
Financial statements and relevant business indicators (Millions of euros and percentage)
| Income statement |
1Q19 |
∆% |
1Q18 |
| Net interest income |
39 |
(8.0) |
43 |
| Net fees and commissions |
36 |
(7.6) |
39 |
| Net trading income |
27 |
(39.0) |
44 |
| Other operating income and expenses |
2 |
141.5 |
1 |
| Gross income |
103 |
(17.8) |
126 |
| Operating expenses |
(70) |
(2.6) |
(71) |
| Personnel expenses |
(34) |
(3.8) |
(35) |
| Other administrative expenses |
(31) |
(9.6) |
(35) |
| Depreciation |
(4) |
185.3 |
(2) |
| Operating income |
34 |
(37.8) |
54 |
| Impaiment on financial assets not measured at fair value through profit or loss |
(10) |
n.s. |
17 |
| Provisions or reversal of provisions and other results |
(1) |
1.2 |
(1) |
| Profit/(loss) before tax |
23 |
(67.6) |
71 |
| Income tax |
(7) |
(69.3) |
(22) |
| Profit/(loss) for the year |
16 |
(67.9) |
48 |
| Non-controlling interests |
- |
- |
- |
| Net attributable profit |
16 |
(66.9) |
48 |
| Balance sheets |
31-03-19 |
∆% |
31-12-18 |
| Cash, cash balances at central banks and other demand deposits |
212 |
(11.1) |
238 |
| Financial assets designated at fair value |
503 |
(0.1) |
504 |
| of which loans and advances |
- |
- |
- |
| Financial assets at amortized cost |
19,520 |
9.7 |
17,799 |
| of which loans and advances to customers |
18,257 |
10.0 |
16,598 |
| Inter-area positions |
- |
- |
- |
| Tangible assets |
99 |
150.5 |
39 |
| Other assets |
247 |
(2.8) |
254 |
| Total assets/liabilities and equity |
20,582 |
9.3 |
18,834 |
| Financial liabilities held for trading and designated at fair value through profit or loss |
42 |
0.9 |
42 |
| Deposits from central banks and credit institutions |
929 |
(26.9) |
1,271 |
| Deposits from customers |
5,065 |
3.9 |
4,876 |
| Debt certificates |
197 |
(7.7) |
213 |
| Inter-area positions |
13,220 |
15.9 |
11,406 |
| Other liabilities |
343 |
26.9 |
270 |
| Economic capital allocated |
786 |
3.9 |
757 |
| Relevant business indicators |
31-03-19 |
∆% |
31-12-18 |
| Performing loans and advances to customers under management (1) |
18,218 |
10.1 |
16,553 |
| Non-performing loans |
430 |
(0.1) |
430 |
| Customer deposits under management (1) |
5,065 |
3.9 |
4,876 |
| Off-balance sheet funds (2) |
407 |
5.0 |
388 |
| Risk-weighted assets |
16,004 |
3.5 |
15,464 |
| Efficiency ratio (%) |
67.3 |
|
69.3 |
| NPL ratio (%) |
1.6 |
|
1.7 |
| NPL coverage ratio (%) |
84 |
|
83 |
| Cost of risk (%) |
0.24 |
|
(0.11) |
- (1) Excluding repos.
- (2) Includes mutual funds, pension funds and other off-balance sheet funds.
Activity and results
The most relevant aspects of the activity and results of the area during the first quarter of 2019 were:
- Lending activity (performing loans under management) registered an increase of 10.0% in the first quarter of the year, and a growth of 20.3% year-on-year.
- Credit risk indicators improved slightly in the first three months of the year: the NPL ratio closed at 1.6% (1.7% at the close of December 2018) and the NPL coverage ratio closed at 84% (83% as of December 31, 2019).
- Compared to the previous quarter, customer deposits under management increased by 3.9%, although they remained strongly influenced by the region's negative interest rate environment and showed a year-on-year decrease of 6.5%.
- Regarding results, gross income declined 17.8% year-on-year (down 19.3% Rest of Europe and down 7.1% in Asia), concentrated in Global Markets as a result of lower commercial activity. Operating expenses continued to fall due to the tight control of personnel and other administrative expenses. The Impairment on financial assets registered an increase with respect to the same quarter of the previous year. The comparison is affected by the reversal of provisions in the first quarter of 2018 due to lower loan-loss provisions in Europe. As a result, the cumulative net attributable profit for the first three months of 2019 stood at €16m (down 66.9% year-on-year).
