Banco Montepio Q1 profit more than triples YoY to €35.3M

  • Lusa
  • 28 April 2023

The institution notes that loans and advances to customers (gross) were €11.97 billion on 31 March 2023, down 2.3% year-on-year.

Portugal’s Banco Montepio made profits of €35.3 million in the first quarter of 2023, more than triple the €11.4 million it made in the same period of 2022, it announced on Friday.

“This favourable evolution was determined by the increase in banking product, with emphasis on net interest income and commissions, and the greater reversal of the cost of impairments and provisions, in particular those related to credit risk,” Montepio said in a statement sent to the Securities Market Commission (CMVM), where it highlighted that, on the other hand, regulatory contributions to the banking sector “amounted to €11.3 million”.

Operating costs totalled €65.9 million in the first three months of 2023, up 13.7%.

Staff costs rose 17.6% to €41.8 million, the bank said in a statement. Excluding the costs of the employee reduction programme, staff expenses would have increased by 6.6%.

At the end of March, the Banco Montepio group had 3,409 employees, three more than last December. Montepio’s network in Portugal remained at 239 branches.

Net interest income (difference between interest paid on deposits and interest charged on credit) grew 70.4% to €90.2 million, benefiting from the increase in interest rates, while commissions rose 8.7% to €32.7 million.

The institution notes that loans and advances to customers (gross) were €11.97 billion on 31 March 2023, down 2.3% year-on-year.

Customer deposits were, on the same date, €12.678 billion – a year-on-year decline of 0.6% – with individuals representing 73% of the total.

In terms of asset quality, non-performing exposures (NPE) were down by €74 million (down 11% quarter-on-quarter), with the NPE ratio falling to 4.8%, which compares “favourably with the 7.8% on 31 March 2022, representing a drop of 0.5 percentage points in the quarter”.

Net of impairment, the NPE ratio for credit risk was 2.0%.

Exposure to property risk also fell (8.8%) in the year ended 31 March 2023, with a reduction to €363 million and now representing “less than 2.0% of net assets” of the bank – one of the targets of the strategic plan.

Banco Montepio also improved its solvency, with its CET1 ratio increasing 0.9 percentage points year-on-year to 13.6% – despite the 0.1 p.p. reduction.

Banco Montepio is owned by Associação Mutualista Montepio Geral.