Q2 2024 Banco Comercial Portugues SA Earnings Call Transcript
Key Points
- Banco Comercial Portugues SA (BPCGF) reported a net income of EUR485 million for the first six months of 2024, a 15% increase year-on-year.
- The bank's core operating profit remained stable at almost EUR1.2 billion, despite a challenging interest rate environment.
- Customer funds grew by 8.9% year-on-year, surpassing the EUR100 billion mark for the first time in the bank's history.
- The bank's digital transformation efforts have been successful, with mobile customers growing by more than 11% and accounting for 70% of the customer base.
- Banco Comercial Portugues SA (BPCGF) maintained a strong capital position with common equity Tier 1 at 16.2% and total capital at 20.6%, comfortably above regulatory requirements.
- Bank Millennium in Poland faced significant costs related to legal risks for FX loans, amounting to EUR276 million in the first six months.
- Operating costs in Portugal increased by 3.1%, driven by higher staff and administrative costs.
- The net interest margin in Portugal decreased from 2.52% to 2.29% year-on-year, reflecting higher costs associated with deposit remuneration.
- Loans to companies in Portugal decreased due to higher interest rates and delays in investment projects, particularly those co-financed with European funds.
- The bank's cost of risk remains relatively high, with an adjusted cost of risk around 50 basis points, reflecting a cautious approach compared to competitors.
Welcome to BCP's Earnings Conference Call. I will go through the highlights of our performance, followed by Miguel Braganca and Bernardo Collaco, who will provide additional detail. On the first six months net income stood at EUR485 million, an increase of 15% year on year, supported on a strong operational performance with special emphasis to Banco where net income went up 16%, reaching EUR411 million, supported by the strong competitive advantage of our business model and leveraging on BCP's leading position in multiple lines of business.
Still include an environment of soft decreasing interest rates since late 2023, we rigorously manage core income and operational costs, being able to maintain a sound and stable core operating profit of almost EUR1.2 billion for the half year activity at a consolidated level.
In Mozambique, Millennium bim keeps showing a sustained and adequate profit level contributing with stable results for the group's profitability. Net income stood at EUR47
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