BCP increases profits by 5.9% to 906 million

BCP reported a net profit of 906.4 million euros for the whole of 2024, a figure that represents an increase of 5.9% compared to the profit of 856 million that had been recorded in the previous year . The growth is explained by the positive evolution of activity in Portugal and Poland, with increases in both credit and deposits, and by the reduction of impairments and provisions to cover potential credit defaults.

The results were reported this Wednesday in a statement sent to the Securities Market Commission (CMVM). "The growth in the group's net profit compared to the previous year was determined by the favourable performance of both the activity in Portugal and the Polish subsidiary, with the results presented by Millennium Bim in Mozambique being lower than those achieved in 2023, conditioned by the impacts arising from the economic and financial situation that the country is going through, namely the downgrade of the [financial] rating of the sovereign debt", the statement reads.

The growth recorded in 2024 is still far below that achieved in 2023, when BCP more than quadrupled its profits. These results were influenced by the extraordinary gain associated with the sale, by BCP's Polish subsidiary, of part of Millennium Financial Services, a factor that was no longer present in 2024.

Miguel Maya therefore believes that BCP achieved "good" results last year. "They were neither exceptional nor special, but good, reflecting the changes made by the bank over several years in terms of the quality of its credit portfolios and the digital transition", said BCP's CEO at a press conference.

This result is mainly explained by the bank's commercial activity, in a year in which both credit and deposits registered growth and contributed to the increase in revenues obtained through commissions.

The total credit portfolio increased by 0.7% and totaled 57,203 million euros at the end of 2024, a variation that is exclusively due to the individual segment, which increased by 3.9%. Considering only housing loans, the portfolio increased by 2.7% and totaled 28,734 million euros. The corporate credit portfolio decreased by 4.5%.

Still with regard to credit, the bank saw the quality of its portfolio improve, with the non-performing loan ratio (which, in the case of BCP, is measured through the non- performing exposures indicator) falling from 2.2% at the end of 2023 to 1.9% in 2024. Considering only activity in Portugal, this ratio fell from 2% to 1.7%.

As for customer resources, the bank saw deposits increase by 7.8%, amounting to 84,042 million euros. Assets under management also registered significant growth, of 9.8%, totaling 6,108 million euros. Considering all indicators, total customer resources amounted to 102,938 million euros in 2024, an increase of 8% compared to the previous year.

Net commissions thus totalled 808.5 million euros, an annual growth of 4.8% that BCP justifies with the "favourable performance" of the activity in Portugal and internationally. "In consolidated terms, the favourable performance of net commissions was due to the growth in both banking commissions, which amounted to 684.1 million euros (...), and commissions related to the financial markets, which totalled 124.5 million euros", explains the bank in a statement.

Financial margin falls in Portugal

On the operational side, BCP recorded several falls, including in the financial margin (an indicator that measures the difference between the interest charged on credit and the interest paid on deposits), which, in 2023, had been the main reason for the sharp growth in this bank's profits.

In 2024, BCP's net interest income amounted to approximately 2.83 billion euros, remaining in line with the previous year (there was an increase of only 0.2%). This performance was achieved despite the "reduction recorded in activity in Portugal", which was "offset by the increase observed in international activity".

Considering only domestic activity, the financial margin fell by 9% and stood at 1,335 million euros, a result that "reflects, above all, the increase in [financing] costs, partially offset by the higher income generated by both the customer loan portfolio and the securities portfolio", explains the bank, highlighting that there was an "increase in costs associated with the remuneration of the deposit portfolio, resulting mainly from the evolution of interest rates in the last year".

Still on the operational side, results from financial operations fell sharply, from 146.4 million to five million, a development explained by the gains that had been obtained by the Polish subsidiary in 2023 with the sale of Millenniu Financial Services and which were not repeated in 2024. Operating costs increased by 12.4% and totaled 1,307 million euros, which "mainly reflects the performance of international activity, namely of the Polish subsidiary".

The banking product thus ended up falling by 5.2% and settling at 3,574 million euros in 2024.

Regarding liquidity and solvency, BCP closed 2024 with a common equity tier 1 ratio of 16.3%, above the ratio of 15.4% that had been recorded in the previous year and the regulatory requirement of 9.7% that had been defined for that year.