CaixaBank earns 40% less due to the merger with Bankia

The accounting effects of the absorption of Bankia take their toll this year on CaixaBank, which saw it close with a net profit of 3,145 million euros, 39.8% less, in the 2022 financial year, a year in which the rest of the Spanish banks have achieved record profits. The reduction is explained because in 2021 its profit skyrocketed due to accounting notes from the merger that this year have not been repeated.

The bank reported this Friday its intention to increase the distribution of dividends up to 55% of consolidated net profit, for which reason it plans to pay its shareholders gross 0.2306 euros per share in April. It is 58% more than last year and it is the highest distribution paid among the large Spanish banks if the percentage of the result is taken into account. In absolute figures it will be 1,700 million euros. This year it plans to remain in the same range, between 50% and 60% of the result, as reported to the CNMV, with the aim of reaching a volume of 9,000 million in the 2022-2024 period.

The entity’s banking business grew by 5.8%, to 11,997 million, basically driven by a rebound in interest income, of 15.7%, influenced by the rise in interest rates starting in the second half of the year . Only in the last quarter that margin stood at 22.8%. Net commissions grew by 8.2%.

Bank commissions grew by 1.7%, although the bank chaired by José Ignacio Goirigolzarri points out that recurring commissions fell by 0.3% by eliminating custody fees for deposits and by unifying the loyalty programs of CaixaBank and Bankia. Commissions for wholesale banking, on the other hand, shot up 20.5%.

Credit grew last year, with a healthy portfolio amounting to 351,225 million euros, 3.3% more. The granting of mortgages doubled (+108%), reaching 14,299 million euros. 90% of the contracts signed were at a fixed interest rate. Consumer credit has grown by 16% (10,235 million) and financing to companies rose by 23%.

Despite the risks of the economic situation, CaixaBank has reduced non-performing loans to record lows with a rate of 2.7%, almost one point less than a year ago. This evolution is explained by the policy of managing doubtful balances, which have reduced them to 2,943 million.

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Dividends from investments fell 15%, to 163 million euros, while the results attributed by companies valued by the equity method fell 39%, to 264 million. This is due to the sale of Erste Group Bank and the consolidation of Bankia Vida. The result was benefited by an 8.1% drop in personnel expenses after the 6,452 worker departures agreed in 2021, of which 5,137 were closed last year. Likewise, 913 offices were closed.

The bank claims to have maintained the commercial rhythm during the past year, in which the integration process of Bankia was concluded, becoming the entity with the highest volume of business in Spain. Without the effects of the extraordinary profits linked to the merger, CaixaBank considers that its profit would have grown by 29.7%.

The bank’s capitalization is comfortable if the requirements demanded by the European Central Bank are taken into account. CET1 closed 12.5%, influenced by the repurchase of 1,800 million euros in shares.

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